In recent months, the video game industry has seen the same hard financial times that the rest of the world has. In order to actively compete within the environment, companies are either: a) becoming more discerning of what kind of product to publish, or b) gobbling up successful, smaller publishers and developers.
Since December of 2007, when Activision merged with Vivendi games, the gaming industry landscape has been changing at an accelerating rate. Yesterday’s announcement that Insomniac Games will be partnering with EA on new multiplatform IPs is the latest salvo fired in the war between publishing giants EA and Activision. Square Enix acquired Eidos. Koei and Tecmo merged.
This isn’t going to slow down. In fact, we’ll see more and more acquisitions take place over the next year or two as publishers become “Super Publishers” in efforts to one-up their competition for exclusive products. The war is on, and there will be plenty of casualties.
There are, it seems, plenty of publishers and developers with targets on their foreheads.
I’ve glued together a LOST-like list of candidates that may provide a worthwhile investment for larger publishers to acquire. Whether they have valuable products, cash stockpiles, or a brand name that consumers are familiar with, these companies are perfect (and perhaps surprising) choices.
Sega
Since Sega moved away from hardware and into software publishing, it has had strings of commercial hits and failures. The brand name still carries weight, especially with the younger North American audience. With licenses like Sonic still somewhat valid, Sega’s value is strong enough for a takeover, especially by license-loving Western publishers like Warner Bros.
Valve
Valve consistently pumps out great games, but what may be their real value is Steam. The software distribution system is unmatched. On the PC Valve’s money-making prowess might only be matched by Blizzard and Battle.net. While EA might be considered a front runner, having already worked with Valve in the console space, a hungry Activision may look to put a complete stranglehold on the PC market.
Capcom
Megaman. Street Fighter. Resident Evil. These games ring nostalgic bells in our heads, and hold considerable weight in the Western market. Any Japanese publisher in need of significant Western sales could take a long, hard look at the company. Are you listening, SquareEnix? Capcom may also be ready for acquisitions of their own. Not necessarily a volume-producing publisher, Capcom focuses on big games. A big flop puts a hurting on the publisher, who may be interested in bolstering their amount of releases to make up for such losses.
Konami
Another Japanese company with a strong legacy of gaming hits in both the East and West. Yes, they are already huge, but could be even bigger if they partnered with Capcom.
Epic
Why haven’t they been bought by Microsoft yet? Perhaps because they, too are waiting for the Bungie effect to push them to Activision.
Majesco
Majesco makes million-selling games, but they mostly reside in the casual market. Cooking Mama, for instance, is always a sales hit. Ubisoft, the other king of the casual realm, would be wise to pick up Majesco, if anything than to corner the upcoming 3DS market.
MadCatz
Once the king of the gaming peripheral world, MadCatz has seen competition come from all angles as motion-gaming has taken off. The company recently signed on to be the sole manufacturer of instruments for the Rock Band franchise, which may make them a viable candidate for a company interested in dipping more toes into the gaming world. Accessory manufacturers like Monster Cable may be wise to look at the company.
Tecmo Koei
While they recently merged and create consistent sellers in the East, they are still comparatively small in the West. Partnering with other publishers might be of value to expand more into the region.
THQ
THQ’s star is getting brighter every day. With Red Faction, UFC, and Darksiders, as well as several children’s and movie licenses, the company is on the up & up.
Take Two
Consistently rumored in take-overs, Take Two may be primed to finally be bought by a bigger publisher. EA has been eyeballing them for years, so now may be as good a time as ever.
TellTale Games
TellTale are the masters of adventure games. Already creating work for several other companies and properties, it’s amazing that the company hasn’t been bought by LucasArts yet.
OnLive
Whether OnLive will survive or not is yet to be seen. Their streaming game technology, however, would serve other companies well down the road.
This list is far from complete (and far from accurate), but it represents developers and publishers that may offer fair value for others looking to expand into other markets or pick up valuable licenses. We’ll see what this next year will bring, especially in the ongoing EA vs Activision battle.
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