Amazon Purchasing Electronic Arts In Huge Gaming Acquisition
What don't they own?
Market and financial experts have been warning us for years that the consolidation of the gaming industry is inevitable as the industry continues to grow. With every passing year, the things that the experts have warned us about are coming to pass: Sony has abandoned exclusives and is acquiring smaller studios establishing a foothold into the PC and MMO gaming markets. Microsoft is acquiring Blizzard in a historic acquisition, and the latest rumors suggest that Amazon is acquiring Electronic Arts.
Earlier today, USA Today claimed that Amazon was planning to make an offer to purchase Electronic Arts — one of the gaming industry giants — in bidding in which, reportedly, Disney and Apple were supposed to partake in as well. However, according to a report published by For The Win, Amazon is not expected to make a bid for Electronic Arts, and neither company has offered an official statement regarding the rumors, leaving gaming news media in disarray as to what’s actually going on.
And there is some conflicting information regarding said rumors and reports. While USA Today has claimed that Amazon was planning on bidding, For The Win cited CNBC Now as their source debunking the rumor. However, an earlier report from VGC has stated that Amazon is planning to bid alongside Apple, Disney, and, of all companies, Comcast-NBCUniversal (CNBC). While it’s virtually impossible to know which side is acting as a credible source at this point, we’ll take the liberty to discuss both eventualities.
Amazon’s alleged acquisition of EA doesn’t really come as a surprise to anyone, considering that the conglomerate has been trying to break into the gaming industry for years. So far, they only offered third-party titles on their Prime-Gaming platform, the company’s main Steam competitor. However, by gaining access to Electronic Art’s assets, Amazon could start offering established gaming titles and their sequels to its customers and gain access to highly-experienced gaming developers that would adapt the company-owned franchises — like the upcoming Rings of Powers — into video games.
On the other hand, CNBC is apparently trying to refute Amazon’s involvement in the acquisition of Electronic Arts, maintaining that Amazon’s involvement is just a rumor and nothing else. Now, it’s entirely possible that CNBC is actually buying EA, thus negating Amazon’s involvement, or the company is trying to lower EA’s stock market price — which climbed 15% after Amazon’s involvement was reported by USA Today — before bidding. After CNBC’s report negated Amazon’s bidding, the price of Electronic Arts stocks went down by approx. 6%.
It would seem that Electronic Arts is actively pursuing a sale or a merger of the company, especially after Microsoft announced its acquisition of Activision Blizzard for an eyewatering $69 billion. EA had previously negotiated with CNBC about a possible merger/acquisition, with CNBC looking to assume control over the combined entity. Apparently, the negotiations failed as both sides couldn’t agree on price and structure, and the entire deal went under.
At this point, the status of the rumored acquisition/merger remains unknown, and all aforementioned companies, including both Amazon and Electronic Arts, haven’t commented on the matter. The only company that was vocal about it was CNBC.
