|ESPN gets to integrate its products in existing EA sports games, while EA gets to integrate its products in ESPN sports broadcasts.
The deal, announced today, also offers EA, of Redwood, Calif., integrated marketing opportunities within ESPN's TV programming and other properties, which include ESPN the Magazine and ESPN.com.
Neither party would disclose financial terms of the agreement, but the New York Times reported the deal was worth between $750 million and $850 million.
"The length of this contract speaks to the commitment and investment in integrating the assets both companies bring to this deal," said Trudy Muller, senior manager of corporate communications at EA.
Consumers will see ESPN content in EA games beginning in 2006, when ESPN's current contract with Take Two Interactive Software expires. The addition of the ESPN name significantly strengthens EA's sports-licensing arsenal, which includes the National Basketball Association, the international soccer federation FIFA, and the recently signed National Football League.
EA also boasts the rights to one of the most successful sports video-game titles ever, the John Madden football franchise, though his contract with EA expires at the end of 2006 and has yet to be renewed. The 15-year ESPN agreement is EA's longest to date, but includes an option to terminate after 10 years under "certain conditions," according to a press release.
Existing EA titles
As well as adding ESPN content to at least nine existing EA sports titles, that investment also includes the potential for developing new ones based on ESPN properties. Likely candidates for new titles include ESPN's X Games and the World Series of Poker.
ESPN is a joint property of the Hearst Corp. and Walt Disney Co.
Ms. Muller said that while adding ESPN content to EA games is on the agenda, EA will have the opportunity integrate its products into the cable network's programming, whether through highlight reels or in simulated play-calling during a pregame show.
And as gaming continues to rise in popularity -- 2004 U.S. sales of digital game items exceeded Hollywood's national box office receipts -- increasing numbers of marketers exploring the potential of integrating their commercial messages into the most popular games.
Biggest sports gamemaker
EA has the greatest share of the sports video-game market, at 64% and with this partnership EA and ESPN strengthen their connection with sports lovers, particularly their core demographic, males 18- to 34-years-old, a highly sought-after consumer.
"You're looking at the No. 1 sports media company coming together with the No. 1 sports video-game brand," Ms. Muller said. "The potential for innovation and what we can deliver is really a sports fan's dream. We also see it as a strong strategy for growing the sports video-game industry."