EA buys PopCap -- does that mean Activision needs to buy Zynga?

EA buys PopCap -- does that mean Activision needs to buy Zynga?

Summary: This week, casual game maker PopCap, best known for Plants vs. Zombies and Bejeweled, agreed to be acquired by Electronic Arts in a deal said to be worth around $650 million.

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TOPICS: Mobility, Banking, CXO, Legal
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This week, casual game maker PopCap, best known for Plants vs. Zombies and Bejeweled, agreed to be acquired by Electronic Arts in a deal said to be worth around $650 million. The move came as a surprise to many, as PopCap has been making serious moved towards an IPO, and as recently as a few weeks ago, company representatives told me that a public offering was definitely their long-term plan.

With one of the biggest producers of social/casual games being snapped up by a major mainstream game publisher, are similar companies going to become acquisition targets as well? The most obvious name to consider is Zynga, maker of FarmVille, Mafia Wars, and similar Facebook games. After all, John Riccitello, CEO of Electronic Arts, told the New York Times: “We’re not going to knock down Zynga tomorrow — they’ve got a great business — but we’ve got an opportunity to close that gap.”

Talk like that should make Zynga attractive to EA’s long-time rival Activision, the only video game publisher that poses a serious threat to EA’s quest for market domination. The two companies have swapped the top spot in the video game business a few times over the years, on the strength of valuable franchises such as Call of Duty (Activison) and Madden NFL (EA).

But even though that would make for a great narrative in this decades-old rivalry, it seems unlikely in our analysis. PopCap’s founders are still involved with the company, but not as CEO. Current Chief Executive David Roberts often jokes that he is the “adult supervision” at the company.

Zynga, on the other hand, is run by co-founder and CEO Mark Pincus -- and as we’ve seen with Facebook and Mark Zuckerberg, successful companies that retain a founder as CEO, especially an outsize personality like Pincus, often prefer to go it alone, rather than get absorbed into a larger company.

Both PopCap and Zynga made their desires for an IPO clear. But while PopCap obviously had a price that caused it to abandon that plan, it’s not clear that Zynga could be similarly swayed at any price.

Topics: Mobility, Banking, CXO, Legal

Libe Goad

About Libe Goad

Texas native Libe Goad resides in New York City and has spent the past decade covering technology and video games for publications including Blender, PC Magazine, Bust, Seventeen and Sync.

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  • RE: EA buys PopCap - does that mean Activision needs to buy Zynga?

    Noooooooooooooooooooooo!

    Goodbye PopCap, you made some nice games.
    SlithyTove
  • RE: EA buys PopCap - does that mean Activision needs to buy Zynga?

    "Talk like that should make Zynga attractive to EA?s long-time rival Activision"

    Why?

    "Both PopCap and Zynga made their desires for an IPO clear. But while PopCap obviously had a price that caused it to abandon that plan . . ."

    I'm guessing EA probably said "once you go public, we're buying all shares - don't bother."

    I'm not a big fan of companies going public, to be honest. Sure, it gets you big money - but it also means all you're caring about from then on is money. Any chance of providing a quality product or stellar customer support is gone once you're public, and if you don't agree with more money at any cost, then the board will just fire you.
    CobraA1
    • What makes you think Zynga's got good tech support now?

      @CobraA1 <br>Having become a recent Farmville zombie, I can tell you now, their support leaves LOADS to be desired. If you think Google and their perpetual beta thing is a running joke, you should take a look at how games like Farmville operate - it's more a perpetual Alpha. <br><br>Zynga's support drones have no troubleshooting skills beyond cutting and pasting an often irrelevant email template into the email they respond with. For instance... I got a sheep that was, for all intents and purposes, invisible. They had me clear my Flash Cache (didn't have anything in there), try another browser (still invisible), try on Farmville.com, etc... Nope.. Sorry. The problem is the object itself - and it's hosed. <br><br>Their solution: Throw 30 farm bucks at the problem. While it's rather nice of them to do so, and it's better than nothing, it may as well be nothing since the problem will likely never be fixed. <br><br>The real solution would have been to have me delete the trashed object, and send me a new one. It's not like it costs them anything. <br><br>The bottom line - they've got a LOT of stuff that goes wrong and it goes wrong far too often and the support people rarely pay much if any attention to the issue to resolve the problem. <br><br>Back in the day, when I was a support drone, there were much higher standards. You actually had to FIX problems, not just give them some cheesy crap placate your pissed off customers. <br><br>All in all, I give 'em a D- for support.
      Wolfie2K3
      • RE: EA buys PopCap - does that mean Activision needs to buy Zynga?

        @Wolfie2K3
        You do know farmville is basically a virus you agree to when you install it right?? It's one of the biggest security hole breeches anyone can use and it's pairing with another huge security hole named facebook make your machine a wide open hacker playground. i hope you don't use your computer for personal finace or shoping or tax work or your screwed lol..Any thing zynga is basically a virus you except and never should be installed.
        Fletchguy
      • Farmville... A virus? Nah...

        @Fletchguy
        I disagree. The game itself is fairly straight forward and unless you count Flash vulnerabilities, it's relatively harmless. Now, if you open up your computer to the bazillion or two of the add ons that allegedly give you Farm cash and prizes - then things get hokey.
        Wolfie2K3
  • Zynga should just fall off the map.

    It is THE perpetual alpha, and its games require that you have the fastest computer you can get your hands on to be barely playable.
    Champ_Kind
    • The fastest?

      @Champ_Kind
      Not really... I wouldn't call my Athlon 64 X2 5200+ chip anywhere near the fastest thing on the market - and yet, it's actually reasonably playable. This is with IE 8, mind you, which is slower than IE 9...

      The only time things get slow is when you visit a friend's farm and they happen to have so much crap on the screen it takes 15 minutes to download everything. And that only tends to happen when you visit someone's farm that's in the 100's and their farm is no longer a regular farm but more like Knott's Berry Farm or DisneyLand.
      Wolfie2K3