Gaming market hots up with major acquisitions
Expectations over next-generation games are set to create a challenging marketplace
Consolidation in the gaming market is picking up pace with three major players engaging in sales and acquisition activity over the past month.
Sony Computer Entertainment (SCE) acquired UK-based game developer Evolution Studios and its subsidiary Bigbig studios for an undisclosed sum to expand its game-development capability.
Phil Harrison, president of SCE Worldwide Studios, said: “Our strategy is to create the best games by working with the best talent. Evolution and Bigbig are world-class additions to our team.”
Similarly, Intel jumped on the acquisition bandwagon by signing a definitive agreement to acquire Irish development firm Havok a manufacturer of interactive software and services used by digital media creators. The acquisition, again for an undisclosed sum, will see Havok, which also has offices in San Francisco, San Antonio, Stockholm, Calcutta, Munich and Tokyo, become a wholly owned subsidiary of Intel.
Renee James, vice president of Intel’s software and solutions group said: “Havok is a proven leader in physics technology for gaming and digital content and will become a key element of Intel’s visual computing and graphics efforts.”
Take-Two Interactive Software, the firm behind Grand Theft Auto, sold all of the assets of its wholly owned Joytech game accessories subsidiary to gaming peripherals vendor Mad Catz.
The terms of the deal were not revealed, but the sale reflects Take-Two’s plans to divest its non-core businesses. Ben Feder, chief executive of Take-Two, said: “The sale of the Joytech assets is consistent with one of the key goals we established in our 100-day plan: to develop strategic alternatives for any operations that we determined to be outside of our core publishing business.”
Billy Pidgeon, programme manager for IDC’s consumer markets gaming programme, said the trend is set to continue. “It is really expensive to develop next-generation games, particularly with high definition and increased expectations for next-generation gaming,” he said.
“Developers or publishers that want to play in that space are going to be challenged, as it will be very difficult to keep costs down. We’re going to see plenty of action from the usual suspects, such as EA, Take 2, THQ and Activision, as well as the three main manufacturers, Sony, Microsoft and Nintendo,” he added.