Whose to blame....

[GMBreaker007]

Quote: Originally Posted by LBzrule

My intial reaction was that is is solely the NFL that's to blame here. But after reading a few reports, this isn't the first time EA has lobbied for exclusivity. They've lobbied for it several times before so as much as I have been trying to keep them out of it, they are not innocent here by any means. In the end Power and Control are at the center of this issue. There is no one innocent here.

Don't you think that the other gaming companies were also aware that EA was lobbying for exclusivity? Of course they did and they did nothing to prepare for a bidding war against this giant. From my understanding Microsoft was one of the companies in the bidding process. Give me a break! Bill Gates couldn't match EA's bid, Yeah Right. Microsoft chose not to beat out EA for the bid. I wouldn't doubt it's because they have so much money sunk into Halo.

I blame these other gaming companies for stretching their resources too far and not being able to compete with EA when the bidding process started.

Why do these companies all decide they need to develop games in every genre. Had VC solely focused on pro football and not produced college games for football and basketball and pro games for all the major sports, they may have saved enough money to beat out EA's bid.

What each of these smaller companies should be doing is developing games for a specific niche market to really compete with the giant. They don't do this because they are greedy capitalists and know that they can at least make some profit by putting out a game for every sport. Why does everyone out there forget that EA started out as a small gaming company and continued to grow and grow. Maybe it's time for these smaller companies to alter their business model so that they can compete with an established giant while growing at the same time.

Just my 50 cents on the matter.

[LBzrule]

Quote: Originally Posted by GMBreaker007

Don't you think that the other gaming companies were also aware that EA was lobbying for exclusivity? Of course they did and they did nothing to prepare for a bidding war against this giant. From my understanding Microsoft was one of the companies in the bidding process. Give me a break! Bill Gates couldn't match EA's bid, Yeah Right. Microsoft chose not to beat out EA for the bid. I wouldn't doubt it's because they have so much money sunk into Halo. I blame these other gaming companies for stretching their resources too far and not being able to compete with EA when the bidding process started. Why do these companies all decide they need to develop games in every genre. Had VC solely focused on pro football and not produced college games for football and basketball and pro games for all the major sports, they may have saved enough money to beat out EA's bid. What each of these smaller companies should be doing is developing games for a specific niche market to really compete with the giant. They don't do this because they are greedy capitalists and know that they can at least make some profit by putting out a game for every sport. Why does everyone out there forget that EA started out as a small gaming company and continued to grow and grow. Maybe it's time for these smaller companies to alter their business model so that they can compete with an established giant while growing at the same time. Just my 50 cents on the matter.

Dude even if they knew, no one could bid with EA man. Only hardware companies could have, MS and Sony. Nobody could bid with EA and EA and the NFL knew that.

[GMBreaker007]

Quote: Originally Posted by LBzrule

Dude even if they knew, no one could bid with EA man. Only hardware companies could have, MS and Sony. Nobody could bid with EA and EA and the NFL knew that.

I think you missed the whole point of my post. I know they couldn't compete with EA. But they did nothing to put themselves in a position to have the funds necessary to compete in the bidding process. They stretched themselves way too thin.

Knowing that EA was pushing for an exclusive licensing agreement, these companies should have streamlined in order to compete. Granted this presupposes that they in fact actually want the NFL and NFLPA exclusive license.

For argument sake, let's just say that what they really want is an exclusive licensing agreement with the NBA and NBAPA. Why would VC/Sega now produce college games and games for other pro sports? Streamline, focus on your NBA game and use the savings to win the exclusive agreement with the NBA and NBAPA.

Once again knowing that EA was pushing for exclusivity, why would they ever price all their games at the lowest price point possible? Sure it meant they sold a few more copies but their total profit was lower.

Example:

So ESPN say sold 10 million copies at $20 a shot = $200 million dollars but if they had priced it at $50 and sold 6 million = $300 million.

That's a $100 million more they would have pocketed even though they sold basically half as many copies. Their rationale for the lower price point was to cut into EA's market share. I think this was a big mistake. It didn't really happen because quite a few gamers out there bought both since ESPN cost so little. Had the price been higher consumers would have been forced to choose one or the other. They would have sold less copies but still made more money.

Couple that with the savings they would have made had they not produced a title in every sport, my opinion is that they would have had the money to compete in the bidding process. EA won the bid at around $300 million.

Using my example above, selling 6 million copies (I think this isn't that far off what they were selling prior to the price drop) would net them $300 million. I don't know what the costs are to produce the game, but let's say $100 million. That's $200 million profit. Now save another $100 million each if ESPN Hockey and Basketball and the college games are not produced. Total profit = $800 million. What they did with the ESPN games is go for the immediate dollar by producing all these titles and selling them at a reduced price. They weren't looking at the big picture considering they must have known about EA's discussions with the NFL regarding exclusive licensing.

Do you know understand where I'm going with the argument? Diversity can be the kiss of death in business unless you have the resources to offset losses in various sectors.

Again this is just my opinion.

[Nutzzz414]

If this was ALL about money, then Microsoft or sony would have the rights to the NFL. Microsoft's and sony's did not come out with a game this year. Their official statement was that they were going to take a year off and come out with a better game. That's a load of crap. Fever has sucked since birth and gameday has sucked since PS2' birth. Are you really going to tell me that they decided to take a year off at the sme time?. They knew that this going to happen. THe y knew that ESPN was coming at $20. They knew that they couldn't bring their games down that low no matter how muched they sucked.They knew that the NFL was shopping for a exclusive deal. They knew that the NFL was not going to alienate their core fans who is (sorry to tell you this ESPN fans) the madden players. You cannot blame EA for this because they are just doing what the other companies wish they could of did. The NFL could of said "we don't want to alienate some of our fans". But the did. But what's the difference between this and WWE/THQ. Notre Dame/NBC or BCS/ABC?. They NFL knew that the balme wasn't going to effect them. People are not going to stop supporting the NFL. Your first instinct is to stop buying Madden. Or stop buying EA games. Everybody who who supports EA, does it by buying and playing their video games. People who supports the NFL, does so by not just playing the games. but by buying jerseys, buying tickets to the games, watching the games on TV, etc. SO if you are feeling really froggy, and ACT like you want to leap to be this public activist. Do all of these things, buy Terell Owens' Power pro football 2K6, get a sharkport and download players and have yourself a ball. But if not, then just deal with it and wait until the game come out before passing judgement.

[mercalnd]

Quote: Originally Posted by LBzrule

My intial reaction was that is is solely the NFL that's to blame here. But after reading a few reports, this isn't the first time EA has lobbied for exclusivity. They've lobbied for it several times before so as much as I have been trying to keep them out of it, they are not innocent here by any means. In the end Power and Control are at the center of this issue. There is no one innocent here.

No matter how much EA lobbies, they cannot FORCE the NFL to make the license exclusive. The NFL has control over its license, no matter what companies say or do. That's why the NFL is to "blame" although as many pointed out they have the right to do as they please with their license. Hell, they could legally decide to prohibit ANY producer from using NFL logos/likenesses if it suited their fancy. This won't happen because there is no business basis for it but you get my point...

The guy that mentionned VC hurting themselves by producing games for every sport is not seeing the big picture. The only way that his point holds is if the games were actually LOSING MONEY. Even if a game generated only a total profit of $10, that still leaves you with $10 dollars more than you had before and whatever you have spent on that game has already been taken into account into arriving at the profit number. So it's not accurate to say that developing NBA, NHL and MLB games caused SEGA/VC not to have enough money to outbid EA unless those games produced losses, which I seriously doubt.

[spankdatazz22]

It's EA's fault for bringing exclusivity up in the first place, and it's the NFL's fault for not being knowledgeable enough about the billion dollar videogame industry to know what kind of harm they did to it on Monday. I'm both suprised and not suprised by so many in the Madden forum justifying the move from a business sense, instead of looking at how they benefit. If you look at the wishlists that were generated before this horrible news Monday, you'll see that Madden fans tend to be much more complacent and accepting of what's set before them.

I don't think Madden will suck because of this move, because it was already a good game. But EA is notorious for not pushing themselves. Given the length of time both companies have been in business and the advantage EA has, there's no way NFL2k should've gotten to the point where they're considered equals on the field. NFL2k's feature list last year completely blew away Madden's. Tiburon and their "we can't do this because of hardware limitations" line is old and sickening. EA is essentially trying to buy a girlfriend instead of trying to win her heart. They're buying a championship, instead of winning it on the field.