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NCAA video game deal could pave way to pay players

Sam Keller #9 of the Nebraska Cornhuskers against the Missouri Tigers on October 6, 2007 at Faurot Field in Columbia, Mo.

One of the biggest battles in college sports has been playing out off the field. Namely, the fight by former college athletes to get a share of the royalties from video games that use their likenesses. Now victory for them may be in sight. Electronic Arts said yesterday it would stop making its popular college football video game, at least for now. That was followed by news of a proposed $40 million settlement between former football players, Electronic Arts and the Collegiate Licensing Company. 

One of the plaintiffs in the case is Sam Keller, a former quarterback for Arizona State and the University of Nebraska.

“EA Sports was using his likeness, down to what shoes he wore, what color his hair was, etc., so that people playing the game could see it was Sam Keller,” says his attorney Steve Berman.  “Every state has a statute that says you cannot exploit a person’s likenesses for commercial purposes, and Mr. Keller thought he was being exploited.”

The terms of the settlement are still confidential and they have to be approved by a federal judge, says Berman.

“But the net effect is that college athletes will get compensated for their image and likeness and that, itself, is a landmark event,” says Michael McCann, director of the Sports and Entertainment Law Institute at the University of New Hampshire.

There is an important wrinkle, McCann says. The NCAA is still fighting the case, and its rules say college athletes can’t be paid for playing sports. McCann says current players may have to wait to cash in.

As for Electronic Arts, dumping its college football game won’t be a huge loss, says analyst Ben Schachter with Macquarie Group. “What you’re seeing in the entire video game industry is this shift towards fewer, bigger, better.”

In that landscape, EA can focus on its blockbuster Madden NFL franchise. The pro game outsells the college football game three to one, says Sterne Agee analyst Arvind Bhatia.

And there are no pesky amateur rules to deal with.

About the author

Amy Scott is Marketplace’s education correspondent covering the K-12 and higher education beats, as well as general business and economic stories.
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