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SvennoJ on 13 July 2023
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EpicRandy said:
PotentHerbs said:

It's definitely not just a feeling. Consolidation is already here, the question is, how much worse can it get? It ramped up considerably after Microsoft spent 7.5B on Zenimax. What would a near 70B deal do? 

Look at the M&A activity in the industry over the past couple of years: Its the most active Sony has been, and this includes one of their biggest transactions ever, Microsoft made their biggest acquisition ever, and Tencent is still spending billions. We got rumors that EA wants to merge with a media company, that Ubisoft is looking to sell, and all the big tech companies looking to jump in. We even have Take Two spending over 10B for Zynga, Sega spending over a billion for Rovio, EA acquiring Codemasters for a billion, etc. All these transactions are unprecedented for the industry. 

You also saw a big ramp-up of studios being created since MS bought Bethesda. Those acquisitions are not what's cause consolidation, they happen because the time is propitious to investment in video game industries. The pandemic skyrocket the industry and now growth is through the roof and is expected to remain that way a least for a few years

There were also significant periods of consolidation in the video game market both in the 1970s and the 1990s. Can you say gaming in the 80s and 2000s was worse because of it?

All the growth is in mobile. Hence I believe this deal is to get an inroad into mobile gaming, using popular IPs and Gamepass to gain traction there. xCloud quality is plenty for mobile streaming but games will also be geared to be more mobile friendly to make it happen.