By Sarah E. Needleman and Laine Higgins 

Electronic Arts Inc. plans to bring back college football videogames after it stopped making them years ago amid a legal battle over the use of student-athletes' names and images. Yet the return comes with a twist, the company says: the new games, for now, will feature real teams, but not specific players, in a bet that gamers will care more about the name on the front of the jersey than those on the back.

EA's intention to re-enter the college-sports arena comes in the middle of a complex debate involving Congress, state legislatures and the National Collegiate Athletic Association over how and whether to compensate student-athletes.

Under a deal announced Tuesday with collegiate-trademark company CLC, EA is gaining exclusive rights to make games that simulate U.S. college football. Game development work is just getting started, the company said, so it could take a few years before any new title comes to market.

EA has secured the rights to team logos, uniforms and other college game-day traditions, a company spokesman said. EA, for now, isn't planning to include player names or likenesses in new games due to uncertainty around rules from the NCAA, the largest nonprofit body supervising U.S. college sports, the spokesman said. The NCAA currently restricts third parties from using those attributes but that could soon change as the organization has committed to rewriting its bylaws amid pressure from high-profile litigation and state legislation.

The announcement comes as EA is slated to release its quarterly financial report after markets close today. Analysts expect the company to show strong growth in its business as the pandemic continues to fuel demand for at-home entertainment, after markets close today.

EA previously made college-football games but the NCAA Football franchise, which started in 1997, was squashed in 2013 after former UCLA basketball player Ed O'Bannon sued the NCAA, the videogame publisher and the collegiate licensing company over the use of his image for commercial purposes while denying him a cut of profits. Mr. O'Bannon later won a landmark antitrust case that challenged the NCAA's long-held definition of amateurism as unpaid service.

Though a settlement was reached, EA said at the time it was canceling the series due to lingering legal acrimony. It has since focused on its professional football series, Madden NFL, one of its most-lucrative titles.

EA Chief Executive Andrew Wilson told The Wall Street Journal in 2019 that the company was looking to bring back college-football games but that doing so would be challenging because of the NCAA's rules. "We would love to build a game if there is a world where, you know, the folks who govern these things are able to solve for how to pay players for the use of the name and likeness and stats and data," he said at the time. "We would jump at the opportunity, build a game in a heartbeat."

The NCAA spent the better part of 2020 drawing up new rules that would allow athletes to profit from their name, image and likeness -- a major concession that came in the aftermath of California passing a law that would allow college athletes to enter sponsorship deals and broad bipartisan interest in reform from Congress. At the same time, public support for paying college athletes has steadily grown in the wake of stories like University of Connecticut basketball player Shabazz Napier not having enough money for food while the school generated revenue from selling his jersey in the campus bookstore.

The NCAA hasn't signaled that its new bylaws will permit group licensing -- where athletes pool their name, image and likeness rights to maximize profit -- a key to EA bringing back the kind of avatars that closely resembled top college football players and big-name universities. Few of the state laws already passed or the congressional bills allow for group licensing. As the NCAA's rules are currently written, any player who appears in his team uniform in a videogame would immediately forgo his collegiate eligibility.

The organization initially targeted last month as a deadline to draw up new bylaws, but that timeline was scrapped after the Justice Department warned the NCAA that its proposals may represent an antitrust violation. The situation was further complicated when the U.S. Supreme Court agreed to hear a case against the NCAA that would permit universities to give athletes unlimited financial awards related to academics, such as paid internships or musical instruments. Arguments in NCAA v. Alston are expected to begin March 31.

The NCAA hasn't said when it plans to unveil its revised bylaws. The NCAA didn't immediately respond to a request for comment.

EA Sports' announcement Tuesday that the revamped game will feature randomized players is essentially a bet that the value of its college football game is derived from the name on the front of the jersey rather than the back. Ricky Volante, an attorney specializing in sports and entertainment, sees relaunching the game before NCAA regulations around name, image and likeness are settled as "playing the longer game."

"The timing is really interesting with the federal legislation proposals that are out there and Alston before the Supreme Court," said Mr. Volante, who runs the Volante Law Firm and is CEO of the upstart Professional Collegiate League, a paid alternative to NCAA men's basketball. EA's plan is about making money with a new title that can be updated once it has the ability to use players' names, he said.

"From a market standpoint, they must have the data that shows this game will be a commercial success with or without... the right to include specific athletes and their name, image and likenesses legally," added Mr. Volante.

EA's plan to return to the category will expand a sports portfolio that includes NFL, FIFA, NHL and UFC videogames. MKM Partners analyst Eric Handler said he was surprised by the move because the company's original college football series wasn't a big seller. "It had lost a good amount of its popularity and sales were declining," he said. "A lot of people would buy the game, play it for a month or so and then sell it back to GameStop and trade it in for the new Madden NFL game."

Analysts say EA may be able to save time and resources, though, by borrowing features and technology from Madden NFL, its decades-old professional football series.

Write to Sarah E. Needleman at sarah.needleman@wsj.com and Laine Higgins at laine.higgins@wsj.com

 

(END) Dow Jones Newswires

February 02, 2021 15:55 ET (20:55 GMT)

Copyright (c) 2021 Dow Jones & Company, Inc.
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