Breaking up with EA for thirty years, FIFA found NFT
Written by: 0xLaughing, Rhythm BlockBeats
On November 20, the 2022 World Cup in Qatar will officially open. The fire is heating up:
In March, FIFA announced that Crypto.com will be the
In May, FIFA announced that it has reached a sponsorship agreement with the public chain project Alogorand and Strategic cooperation agreement, the latter will become the official blockchain sponsor of the World Cup;
Since July, sports fan tokens such as $CHZ, Sorare and other football-related NFTs and chain games have performed very well in the market, with transaction volume and market prices rising to varying degrees;
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In September, FIFA officially launched the NFT platform FIFA+ Collect based on the Algorand network. FIFA+ Collect allows fans to own and collect FIFA World Cup As well as the digital collection of the FIFA Women's World Cup "Highlight Moment", and its "Genesis NFT Series" is currently on sale.
"What rolls on the green field is not football, but gold." Such as this sentence It is said that football is recognized as the "world's number one sport". As the world's top event of this sport, the World Cup contains huge traffic and commercial value behind it. With the strength of Haofeng, FIFA has carried out a number of important cooperations in the field of encryption for this World Cup. Major institutions and projects are facing the explosive tens of billions of NFT markets in various fields. The World Cup is their best way to enter the NFT market. Dongfeng".
So, how big is this opportunity for the crypto market and the NFT space? What kind of impact will it have?
Table of Contents
The World Cup has always been FIFA's "money printing machine"
The World Cup has passed More than 90 years
The full name of "World Cup" is FIFA World Cup, Held every four years, it is participated by national teams from all over the world, symbolizes the highest honor in the football world, and has the greatest popularity and influence. From the full name, it is not difficult to see the close relationship between FIFA and the World Cup. As the organizer of the World Cup, FIFA has been "making money" in this sport.
According to FIFA's 2018 financial report, the first three years of the "four-year plan" were in a state of loss, but in the year of the World Cup it went smoothly "Turn over"
Top attention brings top returns, according to Fifa Financial Report 2018, as current FIFA With the power of the World Cup year, FIFA’s income from game broadcast copyright, marketing, ticket sales and other business revenues has increased significantly more than expected. "Plan" turned losses into profits, with a net profit of US$1.814 billion.
FIFA 2015-2018 revenue status
From the data Looking at it, compared with the situation where the host country may lose money and make money, "Four years without opening, four years after opening" is the best way to describe FIFA.
FIFA operates on a four-year cycle and the vast majority (about 95%) of the organization Revenue is derived from the sale of television, marketing, hospitality and licensing rights related to the FIFA World Cup. Meanwhile, most of FIFA's spending goes to the development of football around the world.
FIFA Global Licensing Revenue 2003-2021 (Source: statista< /a>)
During the 2015-2018 cycle, the item "Permission" is FIFA generated $600 million, or 9 percent of total revenue, from FIFA brand licensing sales, royalty payments and other similar sources. In the "new four years", this revenue will be 159 million in 2019, 158 million in 2020 and 180 million in 2021.
What I have to mention here is that most of FIFA’s licensing income ( An average of about $150 million per year) comes from EA Sports, but they are about to end their 30-year partnership, which also paved the way for FIFA to enter the encrypted world and get involved in NFT.
The capitalists and the big bureaucrats share the spoils unevenly, and the partners who have achieved each other for 30 years part ways
The screen of the first generation of "FIFA" in 1993
At that time, 1993 The first generation of "FIFA" (then named "FIFA International Soccer") landed on Sega MD in 1999, which made all competitors dim. FIFA has been publishing games under the FIFA name since then, kicking off a 30-year partnership. EA and FIFA have achieved each other. EA has made "FIFA" the most famous and best-selling football game series in the world. Its influence has already surpassed the game, bringing football itself to a new level, and FIFA has also benefited from it .
At this time, FIFA will no longer have FIFA. On May 10 this year, Electronic Arts (EA) confirmed in an official press release that they will completely abandon the title of the "FIFA" football game series and launch a new "EA SPORTS FC" series from 2023. This announced the official breakup of EA and FIFA.
The reason is that the word "money" cannot be avoided.
FIFA: Affected by the epidemic, income has declined, thirsty "FIFA 》High income
Licensing has always been one of the valuable sources of income for major football governing bodies around the world , as mentioned above, FIFA earns a lot of money from selling licensing rights every year, especially in "non-World Cup years". Take FIFA’s 2020 revenue as an example. Of the total revenue of USD 266.5 million, USD 158.9 million comes from licensing rights, accounting for as much as 60%, and most of it is paid by EA Sports. This is actually FIFA’s passive income.
However, even FIFA is not satisfied even if it is "laying and earning". The time goes back to October last year, according to The New York Times reports that FIFA's 10-year contract with EA Sports, which began in 2013, is coming to an end and that in new negotiations In 2018, FIFA hoped to increase the revenue from EA Sports' license sales from $150 million per year to $1 billion every four years, and this became a huge point of disagreement between FIFA and EA Sports.
FIFA's revenue in 2019-2021
FIFA starting price , it happens for a reason. Affected by the epidemic, FIFA's revenue has dropped significantly, according to FIFA 2021 Annual Report, FIFA's total revenue in 2020 is only 266.5 million US dollars, which is almost halved compared with 2015, the lowest annual revenue in the last "four years".
FY2005-2022 EA's net revenue (Source: statista)
FY2018-2021 EA net revenue generated from additional content sales in Ultimate Team mode (Source: statista)
In contrast, "FIFA" in the hands of its 30-year old friend EA Sports:
Over the past two decades, according to the New York Times report , the game generated more than $20 billion in sales;
according to EA 2021 Annual Report, FY 2021 net income is US$5.629 billion, Ultimate Team business income is US$1.623 billion, accounting for total 29% of the revenue, and most of the US$1.623 billion came from "FIFA";
according to EA Annual Report 2021, Game Sales Revenue of 1.6 Billion from April 2020 to March 2021 USD, the annual report does not give exact figures for each game, but it states that "FIFA 21 has more than 25 million console/PC players", "FIFA Ultimate Team players are up 16% year-on-year, and FUT games are up 180% . "
According to statista, in the 2018-2021 fiscal year, EA's net income generated from the additional content sales of the Ultimate Team model rose steadily, followed by 1.18 billion, 1.369 billion, 1.491 billion, and 1.623 billion, with a total of 5.663 billion in four years One hundred million U.S. dollars.
Although there is no precise data, it is not difficult to see that EA’s The revenue generated from sales and the corresponding additional content sales of the Ultimate Team mode is very rich. Perhaps FIFA is thirsty for this high profit, so after the expiration of the 10-year contract, FIFA asked EA for a license fee as high as 1 billion US dollars in 4 years is also the largest income of FIFA except the World Cup, but this makes it difficult for EA to accept.
EA Sports: FIFA wants more and more width, World Cup IP exclusive authorization is important but also It’s not that important anymore
From the perspective of EA Sports, it’s not that the $250 million in spending, but are the four letters "F-I-F-A" really worth that much?
FIFA's demand for official FIFA licenses drops
According to VGC reports, EA CEO Andrew Wilson "In non-World Cup years, all we get from FIFA is the four letters on the front of the game box," he said at an internal company meeting last November.
The physical game cassette with "FIFA" printed on it will become the memory of a generation
His statement is not unfounded. According to EA's financial report, the digital version of the game has accounted for about 65% of the overall sales, and most of the "FIFA" trademarks did not even have the opportunity to print on the game box.
In fact, FIFA does not govern the Champions League, Premier League and other competitions, nor does it own stars In fact, only the World Cup is the license purchased by EA that has actual commercial value. In addition, the relationship between the institutions and organizations involved in the team and the game is intricate, and EA also needs to sign licensing fees with FIFPRO (International Federation of Professional Football Players) and special stars, which is also a large expense.
In addition, "FIFA" was originally the biggest competitor "Pro Evolution Football" (renamed "efootball") was far behind by "FIFA" in terms of influence, sales, market share, etc. EA Sports and "FIFA" almost monopolized this track.
The World Cup is important, but it only happens once every 4 years, so from the above On the one hand, FIFA's demand for FIFA has dropped. More generally speaking, EA can afford the money, but "FIFA" is not worth the price.
FIFA's conservative authorization limits the development and operation of EA Sports
< p>According to VGC report, Wilson also stated bluntly that "FIFA authorization is EA football game Obstacles to the long-term development of the series", claiming that FIFA prevents EA from expanding the "FIFA" game into other innovative areas, which is also a point of great disagreement between the two sides.
FIFA is actively promoting football e-sports
FIFA hopes that the authorization of EA will only involve the naming rights of the team and various player parameters Authorizations such as numerical values, and FIFA set to widen gaming and esports portfolio” stated that FIFA is willing to contact developers, investors and analysts from different industries to establish a long-term strategy for games and e-sports products, and finally stated that it may launch the “ FIFA World Cup" and "FIFA Women's World Cup" are two major game e-sports products.
And EA hopes to expand the gameplay mode in the game more, and the football game The form of expression, and through the integration of the highlight moments of the game, and the expansion of NFT digital products, etc., to create a complete football game industry ecosystem. FIFA's own game products are quite "forced", and FIFA wants to cancel EA's exclusive right to use the word "FIFA" in video games, and consider selling FIFA licenses to other games such as "Fortnite" to increase revenue. receive.
The scarcity of the "FIFA" IP that has been built for many years will be diluted, and FIFA's "Small profits but quick turnover" has aroused dissatisfaction among EA executives.
FIFA Lions opened their mouths, asking for a price of 1 billion in 4 years, but EA only bought a four-character OEM, and its own development and operation have always been Restricted by FIFA's conservative authorization, the exclusive IP will also be abolished. The accumulation of the above reasons, the major differences such as "no agreement on money" and "mutual constraints" made them go further and further apart.
In the end, EA chose to cut seats with FIFA to restore "freedom" and lost "FIFA also urgently needs to find the next exit.
When the sports NFT staking is in progress
In December last year, Deloitte, one of the four major accounting firms in the world, released 2022 Technology, Media and Telecommunications Industry Predictions" report It shows that sports memorabilia has entered a new era of NFT digital, and the NFT transaction volume related to sports media content will exceed US$2 billion this year, doubling from last year. By the end of this year, it is expected that 4-5 million sports fans around the world will buy or receive NFT sports collectibles.
In April this year, the encryption analysis organization Messari released The Next Great Crypto Onboarding Event: Sports NFTs, the report states that there is a $30 billion market opportunity for existing fantasy/sports card players, While sports NFT is the intersection of trading cards and fantasy sports, this sports NFT market has brought hundreds of millions of participating users, and these users spend tens of billions of dollars every year. At the same time, sports NFTs bring an exciting value proposition to fans and teams compared to traditional systems.
In September this year, Market Decipher, a market research and consulting firm, released a report, sports NFT market revenue is expected to double in 2022, reaching $2.6 billion. The sports NFT market size will grow at a CAGR of 36.6% between 2022 and 2032, reaching $41.6 billion by 2032.
Various analyzes show that sports NFT is a billion-level market, and in the face of the World Cup This year's most eye-catching sporting event, many giants ran into the arena one after another, and the staking was in progress.
FIFA and Algorand "hand in hand" to create a self-operated NFT platform
FIFA President Gianni Infantino and Algorand founder Silvio Micali announced their cooperation in Los Angeles, USA
In May of this year, on the one hand, FIFA and EA "broke up", and on the other hand, they "succeeded hand in hand" with the public chain project Alogorand. The two parties reached a sponsorship agreement and a technical cooperation agreement. the next growth point.
At FIFA Official Announcement shows that Algorand will become FIFA's official blockchain platform and provide official blocks Algorand will be a regional supporter of the 2022 Qatar World Cup in North America and Europe, and an official sponsor of the 2023 Women's World Cup in Australia and New Zealand. As part of the agreement, Algorand will also assist FIFA in further developing its digital asset strategy.
FIFA+ Collet is a digital collection platform officially launched by FIFA< p>The two parties were silent for 4 months after the official announcement of cooperation, and finally in September FIFA announcement announces the launch of the "FIFA+ Collect" platform powered by Algorand. "Fifa's platform built on a truly decentralized and scalable public blockchain is the first tangible representation of FIFA and Algorand's technology partnership," said W. Sean Ford, interim CEO of Algorand. "FIFA's connection to Web3 via Algorand is a testament to their innovative spirit and desire to engage directly with fans around the world."
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How to play
FIFA and FIFA+ Collet football card The image of the package follows the traditional physical football card package Appearance
The Ultimate Team mode of EA Sports introduced earlier has developed to the present and has become the " FIFA" and even EA's most profitable weapon, generating a profit of up to 1.623 billion US dollars, accounting for nearly 30% of EA's annual net income-this is a shocking report card of the UT model. The business model of the UT model is very simple, and the easy-to-understand explanation is "krypton gold card draw", but EA Sports has derived more gameplay on the basis of card draw.
Aside from the above FIFA official announcement, in fact this time FIFA is aiming at The UT model of EA "FIFA" that attracts money crazily has been applied to the NFT market.
Each NFT card pack contains 3 NFTs
9 At the end of the month, FIFA+ Collet launched "GENESIS" NFT card packs at the same time as the platform was launched, with a total of 532,980 packs. The bundle costs $4.99 and contains 3 NFTs featuring highlights from the FIFA World Cup and FIFA Women's World Cup. And on October 20, a new set of "ARCHIVES" card packs will be launched again.
Its gameplay is to spend $4.99 each time to buy these card packs from the official market, open Card packs earn NFTs, and these NFTs come in four rarities, from lowest to highest: Common, Rare, Epic, and Iconic. Here FIFA+ Collet has made a "little move". It takes 2 weeks for a newly registered account to put its NFT on the shelves for trading. Each NFT is listed on the The minimum price of the pending order on the secondary market cannot be lower than $5, "to prevent breakage from the root", no matter what rarity, as long as it can be sold, each pack can earn a minimum of $10 (actually the rarity Ordinary liquidity is very low).
Currently the most expensive "Ronaldo Goal NFT" on the secondary market
Currently the most expensive NFT on the secondary market is the Ronaldo goal screen when the German team played against Brazil in the 2002 World Cup NFT, the floor price is $4700.
"Collations" achievement system
In addition, on October 21 On the 1st, FIFA+ Collet officially announced the roadmap and opened the "Collations" function and curated competition function similar to the achievement system.
"Collations" achievement system function:
According to the road map According to the description of "Collations", by collecting NFTs and reaching the number required for the corresponding rarity level, players will receive "interesting rewards". The more levels you complete, the more you earn; the higher the rarity, the greater the reward. Reach the target as much as possible before the start of the first match of the 2022 World Cup in Qatar (November 20), and you will be rewarded later, and the accumulated rewards will be delivered at the final.
Curatorial competition function:
Officials will set specific theme challenges Competitions, where users compete against other fans and climb up the leaderboards to win. Each challenge will have specific completion requirements based on a given theme. Place the most valuable digital collectibles corresponding to the theme, and players will earn points based on quality and rarity. There are plans to launch Prestige Challenges in December, where the most competitive fans can take part and FIFA will offer even bigger rewards.
Pay
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Payment by credit card requires a certain fee, and the fee for cryptocurrency payment is almost negligible< p>FIFA+ Collect provides two recharge methods. Users can use VISA/Mastercard or USDC-A to recharge their FIFA+ Collect account and purchase card packs. Algorand wallet is required to choose USDC-A for payment. In addition, the use of credit card payment requires a certain handling fee in proportion to the recharge amount. Taking the recharge of 1,000 US dollars as an example, an additional handling fee of 40.84 US dollars is required, while the use of cryptocurrency only needs to pay 0.001 Algo, which is almost negligible.
Before, EA Sports and FIFA had a bad relationship, FIFA President Gianni Infantino Zeng said very strongly: "I can assure everyone that only authentic and real games with FIFA titles are the best works for gamers and fans."
FIFA, which now advertises as "famous and decent", has brought FIFA+ Collect. Judging from the current functions and creativity, it can be described in one sentence It's "somewhat interesting but not much". As of the publication, the two sets of NFT card packs on FIFA+ Collet have sold a total of 176,000 sets, with a cumulative revenue of 880,000 US dollars. Although the current income is very thin compared to the US$150 million annual licensing fee paid by EA, there is still one month to go before the World Cup in Qatar. At that time, it may be the main battlefield of FIFA+ Collet. FIFA has a history of "begging for a golden job" Whether it can be gone forever, we will wait and see.
Sorare, the pioneer of sports NFT, has maintained steady growth after huge financing
Sorare performed very well in terms of market value, transaction volume, and number of transactions
Sorare was founded in 2018. It is an NFT chain game built on the Ethereum Layer 2 StarkEx network, focusing on the three major sports of football, baseball and basketball. From a numerical point of view, the achievements of Sorare cannot be underestimated: the total market value of NFT has exceeded 61 million US dollars, and the cumulative transaction volume has reached 456 million US dollars, ranking 13th among all NFT projects. Excellent market performance makes it worth a good price, according to reported that Sorare raised 6.3 billion dollars in Series B financing at a valuation of $4.3 billion in September last year. 800 million The U.S. dollar is already a giant in the sports NFT track.
How to play
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The overall structure and gameplay of the game are similar to "Football Manager" and FIFA's FUT. Players collect NFT star cards and play the role of football manager to form clubs and operate players to participate in the game. Rank up and earn money. The difference is that Sorare is not a completely virtual game. The real game data of the players in reality will directly affect the game process: the performance data of the players corresponding to the NFT on the real field will be converted into points in the game. The lineup participates in the competition. There are usually two competition cycles every week. During the cycle, the rewards are obtained according to the score ranking. The score is the sum of the scores of the 5 participating player cards placed by yourself.
The game will be linked to real game data - the players on the cards that make up the team Performance data (such as goals, assists) on the real field will be converted into points in the game, so NFT holders need to pay attention to the players' real games. For example, if the corresponding player is sent off by a red card or scores a goal in a real game, he will win or lose points accordingly in the game.
Through this design, Sorare NFT has a strong connection with real sports events, Then a corresponding liquidity market is created. The value of NFT star cards will fluctuate with the competition and market demand and the real performance of players. In it, many factors such as luck and strategy are superimposed to enhance the playability of the game through games.
Pay
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In terms of payment, it is the same as FIFA+ Collet, and it also supports two payment methods: credit card and cryptocurrency.
Authorized sporting goods giant Fanatics to conquer the NFT market
Fanatics, which started with athletic merchandise, such as sweatshirts and other apparel, and sports-themed consumer products for the home, office and automotive, is today the world's largest licensed sporting goods retailer. According to CNBCAs reported in March this year, Fanatics raised $1.5 billion in a new round of financing, with a valuation of up to $27 billion.
In addition to sports, Fanatics is also expanding horizontally in other areas, including sports collection cards and NFTs.
As early as July last year, Candy Digital, an NFT company jointly established by Fanatics, Galaxy Digital, and VaynerX, The NFT series with the same name as the company was released.
According to Report, Candy Digital completed a financing of US$100 million in October last year, with a valuation of US$1.5 billion. The company will focus on creating a marketplace for sports fans to buy, sell and trade NFTs, "Candy's mission is to develop the next generation of sports and cultural digital assets, providing authentic items and experiences to deepen fan engagement and connect people with their passions to connect."
Currently, Candy Digital’s partners include MLB, WWE, NASCAR and many other well-known sports events and brands. NFT trading platform for collectors to trade. It is backed by Fanatics, the world's largest authorized sporting goods retailer, and Fanatics holds the copyrights of multiple blockbuster IPs such as NBA, NBPA, MLB, and MLBPA. Candy Digital is very likely to shine in the sports NFT market.
Is this good or bad for the encryption world?
"Digital collection" NFT is contrary to "decentralization"
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Bring the concept of NFT into the mainstream. Since then, the sports NFT market has developed rapidly, but almost all of them lack one element-"decentralization".
CEO of game economics and player analytics firm Metanomic Theo Beastly describes FIFA+ Collect as a "walled garden", and with good reason. After experiencing it on the platform, it can be found that the purchased NFT can only be circulated on the FIFA+ Collect platform, which also means that these NFTs are still controlled by FIFA+ Collect, not by the holder, and it is not "resistance to censorship". Purchases and secondary transactions on the platform cannot be found on the chain. Even the "GENESIS" series of FIFA+ Collect did not officially announce the quantity when it was first launched, and people cannot query it from the smart contract on the chain. It has no "transparency".
The gameplay is single, and the cold rice in 2008 has been fried until now
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The "Drawing Card Krypton Gold" of the star card was first introduced in Ultimate Team by EA Sports' "FIFA" in 2008 Launched, 14 years later, FIFA+ Collect, Sorare and other leading sports NFT projects are still using this gameplay, and the innovation is only a change made on this basis, with a single gameplay.
FIFA has always been based on "orthodox" The authorization is not limited to what it can own. For example, Sorare has obtained the authorization of 280 football clubs, covering well-known clubs in football leagues such as the Premier League, La Liga, Bundesliga, Serie A, and Champions League. Liverpool, Real Madrid, Barcelona , Bayern Munich, Juventus, etc. are among them.
It can be seen that it is not a long-term solution for each project to only use authorization as a moat. is their real crux. The World Cup event attracts worldwide attention, but it is only once every four years. FIFA only wants to rely on "selling authorization" to operate its own NFT project. The series only sold 170,000 sets, accounting for only 32% of the total. For such a top-level IP that has been on sale for a month, I don’t know whether to be happy or worried about this result.
NFT has become a safe haven for "loot boxes" to evade gambling sanctions?
As early as 2018, then Belgian Minister of Justice Koen Geens wrote a statement defining "Game of Chance" of chance) is a brand-new term: as long as there is a gambling-like design in which the probability of gaining benefits exists in the game, and this gain will play a role in the game, then it is a game of chance.
According to this theory, the Belgian government requires Overwatch, FIFA18 and CS:GO » remove their "loot box" system, or at least the option to buy boxes with real money, or risk up to five years in prison.
In October 2020, the District Court of The Hague, the Netherlands authorized the Dutch Gaming Authority to issue a With a fine of 500,000 euros per week and a maximum of 10 million euros, the FUT "Krypton Gold Draw" game in the "FIFA" series is determined to be gambling, and EA is ordered to delete this mode immediately.
Although EA won the lawsuit later, these incidents still caused panic. In the latest financial report of EA in 2022, the clear announcement of previous years was changed, and the revenue of FUT was vaguely mentioned. It can be seen that the "loot box" FUT model seems to be a hidden worry for game companies. This may be one of the reasons why these FUT model projects flood into the NFT market.
Low threshold to attract NFT market, the encryption environment can benefit from it
The FIFA+ Collet, Sorare, and Candy Digital mentioned above have lowered the threshold for user participation, which is mainly reflected in two aspects :
1. Register. You only need to enter your email, username and password, or use a third-party login such as Gmail, Facebook, etc., which is very low for users who do not understand cryptocurrency wallets.
2. Pay. Most sports NFT projects provide two payment channels: credit card and cryptocurrency. Similarly, it is very convenient for players and fans who are not familiar with how to pay with cryptocurrency.
Since sports and sports involve a wide range of user groups, how to lower the entry threshold so that no Fans and players with blockchain knowledge understand blockchain games and understand NFT, which is especially important for these sports NFT platforms. Allowing users to enter Web3 with the interaction habits of Web2 without any foreign object perception, and then gradually educate the remaining users on cryptocurrency and NFT, and let them transition slowly seems to be the best solution to break the current encryption world.
Conclusion
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Qatar will spend more than $220 billion on the upcoming 2022 World Cup, more than ten times more than the previous two World Cups, making it the most expensive World Cup ever. In this 30-day countdown, we can see several large global sports brands and powerful institutions taking steps into the encrypted world for various reasons.
The reason why football is called the world The first sport is not only because of the high degree of complexity of football, but also the high degree of commercialization and professionalization in the development of football has also greatly promoted the popularity and development of football. There are billions of fans behind the football industry and even the entire sports industry. When these heroes are competing, through the bridge of sports NFT, they may easily become part of the Web3 revolution in this world.
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