Tuesday, October 08, 2013

NCAA: It's Over (Update)

One of the smartest people I know e-mailed after I posted two weeks ago about NCAA and EA Sports. He presented a counter-analysis, and agreed that I could share it with you guys, but anonymously.

First off, I mentioned that EA Sports was hitting a wall, and one of the data points I used was the decline in the number of franchises, as well as EA's lack of a baseball game.

Mr. A. Nonymous said that a baseball franchise for EA made no sense. Third-party AAA-sports franchises need upwards of two million units to be viable long term. First parties can get away with less because they help sell consoles and don't carry the platform license fee.

The Show sold approximately 700,000 units last year. The Show is a stellar, brilliant franchise, and it can't even reach one million in unit sales.

Even if EA could make a baseball game of that quality (my comment: unlikely), and even if they stole every single unit from The Show, their marketing machine would still have to triple the existing demand for a baseball game.

If you were a gambler, that would be a bad bet.

It's a thoughtful analysis, and I believe he's correct. That makes me incorrect (hell, I'm used to that). I still believe EA Sports is suffering, but baseball as a data point is removed.

He also weighed in on the lawsuit that EA settled with former NCAA players (known as the Keller case). I felt like EA's legal claims in the case were guaranteed losers, almost to the point of absurdity.

However, A. Nonymous disagrees. The judicial decisions were split, and he feels that if EA appeals, they have a strong chance of winning at the Supreme Court level (and they are appealing).

Here's EA's basic framing of the legal issue (from the Keller petition):
Whether the First Amendment protects a speaker against a state-law right-of-publicity claim that challenges the realistic use of a person’s name or likeness in an expressive work.

This is the meat on the bone:
The Ninth and Third Circuits recognized that Petitioner’s video game was an expressive work, under this Court’s holding in Brown v. Entertainment Merchants Ass’n, 131 S. Ct. 2729 (2011). Nonetheless, they held that the game’s depiction of the plaintiffs did not enjoy First Amendment protection. According to the Ninth and Third Circuits, the depiction of a person’s image or likeness in an expressive work enjoys First Amendment protection against a right-of-publicity claim only if the depiction sufficiently alters or “transforms” the plaintiff’s image or likeness. That rule is constitutionally perverse: it affords First Amendment protection only to fanciful or distorted portrayals, not accurate or realistic ones. The rule also chills expression, both because it is hard to predict what a court will decide is sufficiently “transformative,” and because such an inquiry inevitably requires a court to make a subjective judgment about whether a depiction is “artistic,” thus warranting protection, or “literal,” and thus subject to liability.

The test adopted by these two circuits, moreover, conflicts with various other tests adopted by other circuits and state supreme courts, which do not focus on transformation at all. Some of these courts engage in case-by-case balancing of First Amendment interests and right-of-publicity interests—an approach that raises its own constitutional problems. Others give appropriate respect to the First Amendment by confining the right-of-publicity tort to circumstances in which the challenged depiction falsely claims a celebrity commercial endorsement or is unrelated to any other expression and thus gratuitous.

The lower courts’ various and conflicting constitutional tests have resulted in numerous irreconcilable outcomes. For example, the Sixth Circuit has held that the First Amendment protects the inclusion of a professional golfer’s realistic image, prominently displayed in a painted montage including other golfers, ETW Corp. v. Jireh Publ’g, Inc., 332 F.3d 915, 931 (6th Cir. 2003), but the Ninth and Third Circuits now have held that the First Amendment does not protect an accurate digital depiction of a former college football player in a video game. As the judicial confusion has mounted, scholars, writers, and artists have begun to recognize a major threat to free expression.6 This Court’s guidance is urgently needed.

I don't agree with the legal arguments EA advances in this case, but they are clearly far beyond the level of absurdity I described in the previous post.

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