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Media giants are turning away from publisher acquisitions - Williams

The looming spectre of media conglomerates threatening to swoop for some of the biggest games publishers in the industry has past, according to a leading Wall Street analyst.

The looming spectre of media conglomerates threatening to swoop for some of the biggest games publishers in the industry has past, according to a leading Wall Street analyst.

Speaking at the Edinburgh Interactive Entertainment Festival, Edward Williams, senior research analyst at BMO Capital, suggested that firms such as Rupert Murdoch's News Corp. would have already made their move if they intended to buy a major games publisher.

Williams also suggested that until Electronic Arts' competitors decide to merge, the super-publisher will remain the dominant force in the sector.

Speculation over publishers being snapped up by the major players in the media world has snowballed in the past 18 months, fuelled by moves such as News Corps. acquisition of IGN Entertainment and Intermix Media, owner of social networking site MySpace.com

But according to Williams, "If they were going to do it, they would have done it by now. They would have needed to leverage their properties at the beginning of the next-gen life cycle. They should have done it within the past six to nine months."

"I think what we're seeing the big media companies do is stick their toes in the water through acquisitions of games-related businesses, not games publishers," he said.

"Unless we wake some day and find out that the big Western companies - UbiSoft, Activision, THQ and Take 2 - that two or three of those have merged together, EA will remain the biggest publisher in the business," he said.

If competitors were to merge, Williams suggested that it would be a major incentive for investors to dust off their cheque books.

"EA will remain the biggest fish in the sea until its competitors decide they need to come together to gain some scale. And from an investors perspective, there will then be a viable, large capital opportunity to invest in."

Williams also expressed caution to publishers hoping to generate revenue via digital downloads in the hope of extending a products life cycle beyond a one-time sale, offering, "I think it will probably take this platform cycle however long it lasts to introduce the concept of selling digital content. But it will be five years from now before it becomes a more viable way of driving revenues for publishers."

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Matt Martin avatar

Matt Martin

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Matt Martin joined GamesIndustry in 2006 and was made editor of the site in 2008. With over ten years experience in journalism, he has written for multiple trade, consumer, contract and business-to-business publications in the games, retail and technology sectors.