Pachter calls out economics professor who says EA overcharged Madden buyers by up to
A University of Michigan economics professor was recently brought in as an expert witness in a class-action lawsuit filed by a pair of gamers that accuses Electronic Arts of using its exclusive licensing deal with the NFL to muscle Madden NFL competitor NFL 2K out of the picture.
As part of his expert witness testimony, Dr. Jeffrey MacKie-Mason alleged that EA overcharged those who bought Madden games between US 701 million and US 926 million from 2006 through 2009. Big numbers there, but Wedbush Morgan analyst Michael Pachter thinks it's nothing more than horse manure.
In an email exchange with GamePolitics, Pachter didn't mince words in criticizing the professor's monopoly theory:
What kind of fool is this U of Michigan economics professor? ...Madden (according to NPD) sold 23 million units in 2006 - 2009, not the 30 million that Dr. MacKie-Mason claims... The total retail sales were US 1.034 billion, meaning that EA's cut was around US 800 million (retail margin is 20 ). How in the world does [MacKie-Mason] conclude that EA overcharged by more than they generated?
For the four year period, EA's average retail price was US 44. For the period 1995 - 2005 (when either Sega or Take-Two provided [NFL 2K series] competition), EA generated US 1.548 billion of sales on 36 million units, for an average price of US 43. In other words, WITH competition, the price was US 43, and WITHOUT competition, the price was US 44.18...
I rarely read anything that gets me so incensed... They may have some odd estimates I'm not aware of, but based on what you printed, they should be embarrassed. You can quote me.
An increase of a little more than a buck? Gotcha, Mr. Pachter. You've been quoted.
Dr. MacKie-Mason does acknowledge, however, that his analysis is based on incomplete data. EA attorney, meanwhile, have agreed to furnish documents dating back to 2001.
More Madden lawsuits:
http://feeds.feedburner.com/~ff/qj/wii?d=yIl2AUoC8zA http://feeds.feedburner.com/~ff/qj/wii?d=dnMXMwOfBR0 http://feeds.feedburner.com/~ff/qj/wii?d=7Q72WNTAKBA