Electronic Arts (EA) has unveiled “FC 24,” its inaugural soccer video game without the FIFA branding, in a strategic move to sustain the momentum of its highly successful franchise and fortify against an industry slowdown.
The termination of the near three-decade-long partnership between EA and FIFA, marked last year, was prompted by reports of FIFA demanding a doubling of the annual $150 million payment from the video game giant.
Consequently, “FC 24” lacks the visibility and marketing advantages associated with the FIFA brand. The success of “FC 24” holds immense significance for EA, with analysts estimating the franchise contributing significantly to the company’s sales and $32 billion market value, Reuters news report said.
Joost Van Dreunen, a lecturer at NYU’s Stern School of Business, stated, “The end of such a high-profile partnership…creates an uncertain future for the publisher,” highlighting concerns among both gamers and investors regarding the impact on EA’s revenue generation.
To enhance the appeal of “FC 24,” EA has integrated new features, including cross-platform play and HyperMotion V technology, utilizing real footage data to program in-game movements. The standard edition of the game is priced at $69.99 in the United States, while the ultimate edition is available for $99.99.
Industry analysts anticipate that the split from FIFA will free up a larger marketing budget for “FC 24,” benefiting from retained licenses for various soccer leagues, teams, and players. Michael Pachter, an analyst at Wedbush Securities, believes that this shift will enable EA to increase marketing expenditure from under 10 percent to about 16 percent.
Despite concerns, Pachter expresses confidence that sales for “FC 24” will not suffer significantly, projecting a minor decline of approximately 5 percent. He attributes this optimism to the resilience of the franchise’s Ultimate Team game mode, generating over a billion dollars in annual sales.
The mode allows gamers to purchase card packs to construct their virtual teams, proving to be a substantial revenue stream for EA, especially as the company grapples with a post-pandemic slowdown across its other game offerings, including Apex Legends. EA missed net bookings expectations in the last quarter and proceeded to implement a 6 percent workforce reduction in March.
