Analyst: Industry Consolidation "Makes Financial Sense"
With the recent news that Activision is making a play for Take-Two Interactive, the current state of the video game industry is once again a topic of discussion.
We asked EEDAR analyst Jesse Divnich what he thought of the possibility of the Call of Duty publisher snagging the Grand Theft Auto producer, and although he wouldn't comment on that particular scenario, he did talk about consolidation. In his eyes, it "just makes financial sense" if the industry wants to compete with the biggest entertainment corporations around. Said Divnich:
"Our industry will continue consolidate, it just makes financial sense. If there is anything we’ve learned over the last ten years it is that our industry is more than just about making video games, it’s about making entertainment. Companies such as Sony, Time Warner, and Disney are worth 4x that of our biggest company (Activision). To compete in the entertainment industry, our industry’s companies need to be larger and need access to greater resources.
I have no doubt in my mind that over the next 5 years are industry will continue to consolidate or they themselves be acquired by a media conglomerates. I prefer the former, as should we all."
Oh, I think we'll all agree on that last point. As gaming has become legitimate big business, we need to accept some inevitable changes, and hope those changes don't come at the expense of our entertainment. The sacrifice of quality is something the fans always fear but having our best companies snapped up by media conglomerates...well, that fills us with even more anxiety.
2/28/2011 11:55:32 AM Ben Dutka