Analyst Doug Creutz of Cowan & Company has questioned the $763 million Disney intends to spend on its acquisition of social games firm Playdom.
In a note to investors he pointed to Electronic Arts' Playsfish deal from last November, noting that EA bought a company with more active users for a considerably lower price.
"At first look, the deal looks very expensive to us and the initial financial impact is unclear," wrote Creutz.
"With a reported 42 million monthly active users across all social networking platforms, Playdom is approx 30 per cent smaller than the 60 million monthly actives Playfish reported at the time of the Electronic Arts deal," he detailed.
"Counting only current Facebook users, Playdom's monthly actives appear to be roughly 15 per cent smaller those of Playfish (based on data from AppData.com). However, Disney's $763 million potential purchase price, which we estimate is roughly 12 times last twelve months revenue, is nearly twice the $400 million (including performance based earn-outs) that EA spent to acquire Playfish just eight months ago."
The acquisition by Disney is the fourth such move since Robert A. Iger became chief executive of The Walt Disney Company, buying up Tap Tap Revenge developer Tapulous, Bungie co-founder Alex Seropian's Wideload Games and the massive $4 billion spend on Marvel Entertainment.
With the number of users playing games on Facebook slowing, Creutz said that spending money on advertising could become a significant expense should word-of-mouth marketing become less effective.
"Viral growth appears to be slowing on Facebook. We are not sure why Disney would pay such a significant premium to the Playfish valuation to acquire Playdom, particularly since user growth for social gaming (on Facebook, at least) appears to have noticeably slowed in the past six months, with some hit games actually beginning to shed users.
"We believe the dynamics of the social gaming space are becoming increasingly commoditised and fad-based, and attracting gamers could become an exercise in increasingly aggressive marketing budgets, impacting the economics of the social gaming model," he added.