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EA buys ESPN License
EA Sports Interview
Senior VP talks ESPN, NFL, X-Games, and MLB.
January 18, 2005 - There is so much going on in the world of sports video games, it seems not a week goes by without a mind-blowing announcement. From the NFL exclusive to EA buying the ESPN license for the next 15 years, our collective heads are still spinning.
IGN Sports caught up with Frank Gibeau, Senior Vice President of Marketing, to get his take on the latest rumblings, including the big ESPN deal that just went down.
IGN Sports: Why does EA need the ESPN license?
Frank Gibeau: We need ESPN because they are a very innovative company, they're very creative, and as you know being a long-term follower of the company, we were at one time EASN, so it goes way back. We've always admired their company, admired what they have done. And frankly what we want to try to do with ESPN is continue to try and build and grow the category even more. Sports gaming is about 20% of the interactive business and we'd like to grow that. We'd like to grow it internationally, we'd like to bring in more sports that ESPN covers or broadcasts around like the X-Games and the World Series of Poker and things like that. Going into the next generation of technology, the collaboration between our two companies in things like high definition, live sporting events with linkage into the game coming through online with tickers and such, there's no better partner. Talking to our fans, and I am one of them, I watch Sporscenter and I play video games. And capturing that sports lifestyle is very interesting. ESPN approached us a few weeks ago and we thought about it, and most importantly, it really worked on a customer level. When you talk to people about who makes the best sports games, EA Sports is right there, and when you talk to people about who has the best sports network, it's ESPN. We knew that was a sports fan's dream, and it fits together nicely. The rest of the deal unfolded from there.
IGN Sports: Was the Visual Concepts/ESPN deal contingent on them keeping the NFL license or did the deal simply expire?
Frank Gibeau: The conversations were prior to that. ESPN's deal was up with Sega and they needed to figure out who they were going to partner with next, much like the NFL was an open bid. If we had lost that bid, you'd be writing a story about how it's the death of EA Sports and Madden is gone after 15 years. I read the boards and see the posts people make about how aggressive we are, but this is competition. They could've won, and if we would've lost, we would be on the other side going 'It was great being in the football business'. This is all competition, it's a game, and when ESPN approached us, we looked at it like our brands fit together nicely and came to an agreement. We did not approach them, but it all happened really fast, just over the course of the Christmas break.
IGN Sports: But don't you see the games dropping in quality without the competition? It seems only natural.
Frank Gibeau: We're not going to become the next phone company or cable company, that's just not the case. We have a move toward all new technology right now, and we're forced to innovate by virtue that we have to transition to new hardware. And when you look at what is happening in the market place, sports gamers buy everything. They buy Grand Theft Auto, they buy Halo, they but Need for Speed, these games are our competition. You can sell a certain amount of products to just sports fans, but when you get into the really big numbers, you really need to appeal to a broader market, and to appeal to this broader market, you really need a kick *** game that is a good competitive choice for a consumer shopping for other titles. It's an appropriate thing to write, because without competition, you would think we would slack off, but knowing EA and knowing the culture and what we're doing internally, that's not what we're doing at all.
IGN Sports: Can we expect to see the ESPN content integrated in Madden similar to what we saw in NFL 2K5 last year?
Frank Gibeau: We want to go even bigger than that. John Madden is an ESPN broadcaster, so if you think about the announcing talent, that was already a given. We want to go to the next level of ESPN. When you're building a video game in high definition, just like when you're shooting a broadcast in high definition, there are so many new things that you need to be able to do and learn and execute against. We're really looking forward to things like a ticker that's live that's linked to ESPN. And when you think about it out over 15 years, there are all types of things related to fantasy, wireless, and stuff like being able to update your rosters that night based on the rosters from the real game that's about to take place. We've just been sitting around the last few weeks brainstorming about what is possible, and the results are amazing. If you start to think about online fantasy and integrating fantasy games into game content, these are just some of the areas that we are going to have to push to help grow this business.
IGN Sports: You mentioned earlier about new games based around ESPN content like the X-Games and poker. Are you more apt to do a game around a show like Tilt or around an event like the World Series of Poker?
Frank Gibeau: It could be either. That's what is so great about this relationship, we could do either one. We could put together some game designs, test them, get some feedback, figure out what's the best idea and go build it. In terms of the X-Games, that's a great property for them in the winter and the summer. And the fact that there hasn't been an interactive version for a very long time, points to us as an opportunity. Traditionally, the extreme game category was overbuilt with a lot of bad product, but that's all been cleaned out, and there's an opportunity there to innovate and try to build some new ideas.
IGN Sports: In terms of EA Sports online, last year, Madden was free because it had a sponsor. Do you see now, that there's no competition, that people will have to pay extra to play Madden online?
Frank Gibeau: We have nothing to announce on that front, but my expectation is that we will continue to look at sponsorship. I don't personally believe that you can charge for matchmaking. As a gamer, that's insulting. I'm a hardcore gamer, so it's useful in my role for me to say, no, nobody is going to pay for that. At the end of the day, it costs a lot of money to build online features and then to support it with servers and updating it, and somehow, a company needs to be able to make a return on that investment. That's the trick. You want to make a return on that investment, but you also don't want to piss off your customers. That's a balancing act that frankly, a lot of companies still haven't figured out. We'll continue to experiment with it and see how it works out. Xbox Live works pretty good, World of Warcraft works pretty good, and really, the EA Sports Nation works pretty good in it's current sponsorship model where you get all of the stuff, but we're still able to build a business model around it.
IGN Sports: In terms of naming the games, will it be ESPN NBA Live or ESPN Madden, or will it be more along the lines of NBA Live 2007 powered by ESPN?
Frank Gibeau: EA Sports will be the title brand. It will be EA Sports Madden NFL 2007. We didn't get this deal for name recognition. The ESPN name will not supersede the names of our games. It's kind of like Intel inside. You buy the computer from Dell, but it has the Intel processor.
IGN Sports: One thing we're just finding about is Take Two's potential deal to get the exclusive MLB license. Does that mean the end to EA making baseball games?
Frank Gibeau: We're going to have an announcement about this shortly. This is the way business works. It's a pretty exciting time in the sports category. It's interesting because it has flown under the radar for so long from the leagues and the partners, and the business has just gotten so big, games are bigger than box office now, that people are paying attention to it. The business is changing. That's just a simple fact and you have to adjust to it. The days of when this was a fun, cottage industry are pretty much gone, unfortunately.
IGN Sports: I also hear that deals are on the table for genre exclusives with the NBA. Do you have any comments about that situation?
Frank Gibeau: No, we don't have any comments on this right now. We're always talking to the NBA and we're great partners with them. In regards to baseball, we're going to launch MVP 2005 shortly, and it's a great game. You're really going to see a quality product.
IGN Sports: Anything else you want to add about all the crazy deals going down?
Frank Gibeau: I think we have a lot of work to do as a company to try and get us positioned with gamers and the hardcore fans so that they understand that all of these financial moves and strategies are not so we can slack off when it comes to making great games. One thing that's lost in all of these stories is just how good all of our EA Sports products are. I think we still have room to improve in hockey and other places, but Madden has been quality since the inception of the PS2. We look at ourselves as competition, because we know we have to innovate in order to get sales. If we don't, sales aren't going to grow, and that's not why we're doing these deals. We're doing this for our fans. We're doing this for our consumer. At the end of the day, it's about the games, and we know that. We just want everyone to know that we're not going to become the next phone company and start slacking off. We want to make the best games possible, bottom line, and these deals are going to help enable us to do that.
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