Big Potential in Mobile Game Business


Take-Two Interactive announced its plans to acquire Zynga, the developer of mobile games such as FarmVille for USD 12.7 billion.

This is one of the biggest value acquisitions in video game history. In comparison, Microsoft 'only' spent USD 7.5 billion when they acquired Bethesda Softworks, one of the major developers for PC and console games.

Even the acquisition of Clash of Clans developer Supercell by Tencent is worth 'only' USD 8.6 billion. So what are the GTA V publishers looking for in Zynga? Of course the potential to increase their profits from the realm of mobile games.

Zynga has a complete portfolio of mobile games, including FarmVille, Words With Friends, and High Hells. These games will add to the existing Take-Two mobile game portfolio, such as Dragon City, Monster Legends, Two Dots, and WWE Supercard.

"This acquisition will significantly diversify our business and also strengthen our leadership position in mobile (gaming), which is the fastest growing segment in the interactive entertainment industry," said Take-Two CEO Strauss Zelnick.

But of course that's not all that Take-Two got from this acquisition. They can of course also add to -- or rather leverage -- Zynga's expertise to make big profits from free, lightweight games on the mobile platform.

The reason is, this mobile game in recent years is one of the most productive industries. Call it PUBG Mobile, which became the mobile game with the largest revenue in November 2021, with revenues approaching USD 254 million.

Pokemon Go was like that, for five years they generated more than USD 5 billion in revenue. Meanwhile, the game studio owned by Tencent (one of the games is COD: Mobile) made USD 10 billion in 2020.

For this reason, many 'traditional' game publishers in recent years have been busy acquiring mobile game developers. For example, Take-Two, which previously acquired Nordeus (the developer of the Top Eleven Football Manager game), also Electronic Arts, which acquired Glu Mobile and Playdemic, and many others.

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