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Will a New NFL App Lead to Higher Xbox One Sales?

Microsoft will launch a new version of its NFL app for the Xbox One before the new season starts next month. The app, which is part of the $400 million deal Microsoft signed with the NFL last May, will also be available for Windows 8 devices.

"Snap" in action. Source: Microsoft.

Fantasy football is a huge business. The Fantasy Sports Trade Association estimates that 41 million Americans and Canadians have combined to spend $3.64 billion on league, transaction, and other fees over the past 12 months. By comparison, the NFL generates roughly $10 billion in annual revenue.

Since fantasy football is interactive, similar to the "coach" mode in NFL video games, it makes sense for Microsoft to promote the Xbox One as a fantasy football hub for gamers who also love football.

But will football fans buy an Xbox One?

While that seems like a sound business strategy, it doesn't address the Xbox One's core weaknesses -- its lack of exclusive games when compared to the PS4 and Wii U.

In fact, a big NFL app is just an extension of Microsoft's original attempt to turn the Xbox One into an all-in-one computer for the living room. That misguided strategy resulted in the Kinect being stripped from the system to match the PS4's price , and the closure of Xbox Entertainment Studios, which was intended to create original programming for the console. Microsoft promised to focus more on games during E3, but it failed to impress hardcore gamers who were still waiting for the next Halo or Gears of War .

Regardless of those mistakes, Microsoft is pushing hard to tie together video games, NFL games, and fantasy football before the season starts. It will also launch an NFL-themed bundle, which includes Electronic Arts ' Madden NFL 15 for free, later this month. But the key question is -- will football fans really buy a $400 console to do what can easily be done on PCs and mobile devices?

To answer that question, we can look back at sales of NFL titles on the Xbox 360 and Xbox One to gauge how many Xbox owners are also NFL fans.

The most popular football video game on the Xbox 360 was EA's Madden NFL 10 , which ranked No. 59 in sales, with 2.8 million units sold. The top 10 Xbox 360 titles are dominated by four names -- Kinect Adventures , Call of Duty , Halo , and GTA V .

The best-selling football game on Xbox One is EA's Madden NFL 25 , which comes in at No. 11, with weak sales of 570,000 units. The top Xbox One title is currently EA's Titanfall , which has sold more than 2 million copies. Those numbers don't indicate a big overlap between hardcore NFL fans and hardcore gamers.

The Foolish takeaway

Microsoft's NFL app for the Xbox One is certainly a great, streamlined tool for diehard NFL fans. The app will be a dream come true for hardcore gamers who love Titanfall as much as fantasy football. Unfortunately, none of those facts will lead to higher hardware sales for the console.

There's no real incentive for NFL fans to buy an Xbox One to use the app if the same features can be accessed on other devices. The same goes for the Windows 8 version -- it's great, but fans will likely stay with a simpler app for iOS or Android.

In conclusion, Microsoft's $400 million deal with the NFL will definitely help it gain exposure with product placements for the Surface, which will be used to track player stats with RFID tags, as well as heavy advertising. But investors and gamers shouldn't expect the new NFL season to help the Xbox One gain much ground against the PS4 or Wii U.

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The article Will a New NFL App Lead to Higher Xbox One Sales? originally appeared on Fool.com.

Leo Sun has no position in any stocks mentioned. The Motley Fool owns shares of Microsoft. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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