2010: A Great Year for Game Industry Funding and Acquisitions

April 29, 2011 -

Video-game industry-related funding and acquisition deals rose 36 percent to a total of 210 in 2010, driven by developments in the online and social network gaming segments. This is according to new IHS Screen Digest research. The research firm said that 123 funding rounds and 87 acquisitions closed in 2010, and that the volume of activity last year was up by more than a third from the 2009's total of 154 events.

Acquisitions doubled last year, with 20 - 24 events occurring every quarter, compared to 49 acquisitions for all of 2009. Total funding for 2010 reached $1.89 billion, up 130 percent from $819 million in 2009. The numbers cover funding and acquisitions activity in all areas of the games market (excluding mobile gaming, which was tracked separately).

"Two key trends fueled the robust pace of funding and acquisitions in gaming during 2010," said Steve Bailey, games analyst at IHS. "First, it was driven by burgeoning activity in the fast-evolving sphere of online gaming, with particular emphasis on social network gaming. Second, movement in funding and acquisitions also has ramped up between Western markets and entities in Asia, centered likewise on the growth to be found in various aspects of online gaming. In particular, the global opportunity presented by versatile browser-based content, on both PC and mobile platforms, drove companies in Asia and the United States alike to embrace opportunities presented by each region, as IHS Screen Digest research shows."

The total declared value of funding deals in the social network gaming segment increased by nearly 300 percent in 2010. This data comes from a new report entitled: Games Market Monitor: Acquisitions and Funding in 2010.

The biggest funding event of the year in 2010 was Digital Sky Technologies (DST), which closed $300 million from Chinese online gaming company Tencent. DST, which was later renamed Mail.Ru.Group), has investments in both Facebook and Zynga, so its input into social network gaming in the West makes sense. Zynga received $147 million from Japanese investor Softbank. Other notable funding events include Zenimax Media’s receipt of $150 million from Providence Equity Partners, which led to its game publishing arm Bethesda Software acquiring two new studios, Arkane and Tango Gameworks.

Also last year, U.S.-based Flash-gaming aggregator Mochi Media was acquired by Chinese online gaming company Shanda for $80 million.

The report also covers notable developments on many other aspects of the games market. These include social network gaming; massively multiplayer online games (MMOG) and virtual worlds; casual gaming; core gaming; payment and billing; social technology; and edutainment, lifestyle management and gaming networks.


Comments

Re: 2010: A Great Year for Game Industry Funding and ...

2010: A Great Year of Absorbing Talent And Exploiting it.

Seriously, this is good news? This is just the renewal of the same old cycle in the games industry. Game publishers buy up lots of talented and successful studios to ride their prosperity for easy profits and then dump them when they no longer provide the rock-star profits they used to bring in. This is nothing to be optimistic about. Sure, thanks to the acquisitions, these studios are going to get more funding to pay the people that work on those games. But as soon as they loose their AAA luster, they'll be cast off like dead skin. Whereas, if they stayed independent,  a slightly less profitable release wouldn't necessarily have been the end for them. Under a company like Activision, they'd get the axe.

How many of those acquisitions are still open? How many were already doing well without a major publisher? How many are being paid to repeat their most profitable creations until we all get sick of seeing another iteration of the same popular title? How long will it be before that gets stale and lower profits prompt publishers to cull the herd? Game publishers aren't in the business of publishing games. They are in the business of providing a "product" that people will buy as many of as they can put out. If that means churning the same crap out over and over simply because people will buy it, then what incentive do they have to do anything but? They're in it for the profit. It's not for the games. Applauding more acquisitions is applauding publishers that push out more of the same stale crap because there are millions of morons willing to buy it, justifying this sick cycle of overly derivative work.

-Greevar

-Greevar

"Paste superficially profound, but utterly meaningless quotation here."

 
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Matthew Wilsonit is a game worth playing if you have a pc/360/ps304/20/2014 - 9:34pm
MaskedPixelantehttps://twitter.com/IGLevine/status/457552538343325696 The Lutece Twins show up in some of the most unlikely of places.04/20/2014 - 2:44pm
Andrew EisenAs it happens, Chinatown Wars is the only GTA game I've played.04/19/2014 - 10:43am
Papa MidnightWith GTA5 (to date) failing to even provide indication of a PC release, I'm realising that this might be the first GTA game that I have not played (outside of Chinatown Wars) since the series inception.04/19/2014 - 8:14am
IanCSo im guessing a bunch of edutainment games, which a lot of people elsewhere are going gaga over, dot count as classics? Okay. If you don't mind me, i have a sudden urge to play Putt Putt....04/19/2014 - 6:15am
MaskedPixelantehttp://www.joystiq.com/2014/04/18/playstation-99-cent-sale-discounts-tokyo-jungle-super-stardust/ Weekend long PSN flash sale. So much stuff is 99 cents for the rest of the weekend.04/18/2014 - 5:59pm
Adam802http://www.polygon.com/2014/4/18/5627928/newtown-video-game-addiction-forum04/18/2014 - 4:14pm
Matthew Wilsonit is a video talking about why certain games/products/consoles do well, and others do not. he back it up with solid research.04/18/2014 - 3:56pm
Andrew EisenI'm not keen on blind links. What is it?04/18/2014 - 3:45pm
Matthew Wilsonthis is worth a whatch https://www.youtube.com/watch?v=MyXcr6sDRtw&list=PL35FE5C4B157509C904/18/2014 - 3:43pm
MaskedPixelanteNumber 3: Night Dive was brought to the attention of the public by a massive game recovery, and yet most of their released catalogue consists of games that other people did the hard work of getting re-released.04/17/2014 - 8:46pm
MaskedPixelanteNumber 2: If Humongous Entertainment wanted their stuff on Steam, why didn't they talk to their parent company, which does have a number of games published on Steam?04/17/2014 - 8:45pm
MaskedPixelanteNumber 1: When Night Dive spent the better part of a year teasing the return of true classics, having their big content dump be edutainment is kind of a kick in the stomach.04/17/2014 - 8:44pm
Matthew Wilsonhttp://www.giantbomb.com/articles/jeff-gerstmann-heads-to-new-york-takes-questions/1100-4900/ He talks about the future games press and the games industry. It is worth your time even though it is a bit long, and stay for the QA. There are some good QA04/17/2014 - 5:28pm
IanCErm so they shouldn't sell edutainment at all? Why?04/17/2014 - 4:42pm
MaskedPixelanteNot that linkable, go onto Steam and there's stuff like Pajama Sam on the front-page, courtesy of Night Dive.04/17/2014 - 4:13pm
Andrew EisenOkay, again, please, please, PLEASE get in a habit of linking to whatever you're talking about.04/17/2014 - 4:05pm
MaskedPixelanteAnother round of Night Dive teasing and promising turns out to be stupid edutainment games. Thanks for wasting all our time, guys. See you never.04/17/2014 - 3:44pm
Matthew WilsonAgain the consequences were not only foreseeable, but very likely. anyone who understood supply demand curvs knew that was going to happen. SF has been a econ/trade hub for the last hundred years.04/17/2014 - 2:45pm
Andrew EisenMixedPixelante - Would you like to expand on that?04/17/2014 - 2:43pm
 

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