Conflicting reports emerge over whether Amazon is set to buy EA

0

This morning there is a new report from GLHF on USA Today where editor Kirk McKeand says his sources are telling him that Amazon may be set to announce an acquisition of Electronic Arts (EA) as early as today. today.

(Update 8:11): I just saw a CNBC segment where they said that according to their sources, this deal is not is happening, according to “people who would know”, dismissing the McKeand/GLHF report and mocking his Swedish origins, for some reason (GLHF is based in Stockholm). EA stock is now down from 14% pre-market gains to 2% gains).

The original article follows:

What was once perhaps unthinkable in the gaming industry is less so in the age of mega-acquisitions like Microsoft’s $70 billion purchase of Activision and $7.5 billion of Bethesda. previously. Embracer Group picked up studios and Sony tried to keep up with big buys like Bungie. But Amazon news is different because Amazon is good, Amazon.

This rumor, if it comes to fruition, would reflect many months of other rumors that EA was looking to sell and Amazon was looking to buy (along with Disney, Apple, Meta and other tech/media players). EA, with its $35 billion market capitalization, is one of the industry’s largest independent publishers in the post-MS/Activision landscape, but that could be about to change.

Why Amazon?

Other than “they can afford it”, Amazon has always been on the fringes of the video game industry without having much impact in… the production of real games. Amazon owns Twitch, the giant streaming platform primarily used for video game streaming. Amazon has launched Luna, a game streaming service that hardly anyone has heard of. And Amazon released a few games like New World, an MMO that’s not exactly a smash hit, and Lost Ark, which did better, but only because it was a port of a existing and successful Korean game.

Buying EA would mean Amazon now owns and publishes a massive amount of legendary game franchises, instantly. FIFA, Madden, Apex Legends, Battlefield, Battlefront, Jedi: Fallen Order, Mass Effect and Dragon Age would now all be Amazon properties. Almost all of them have a new game in the works, and it seems unlikely that a deal with Amazon will significantly derail anything that’s planned. I wouldn’t expect this to be a WB/Discovery/HBO situation where new bosses come in and start cleaning the house. Amazon wants all of these games and these players and these franchises, and that buy would basically be them admitting they can’t do it on their own, despite years of trying, so they buy their way of influencing.

Like the Microsoft/Activision deal, this would be subject to some regulatory scrutiny. Microsoft had to commit to Call of Duty remaining a cross-platform game, in order to avoid anti-trust issues. Amazon doesn’t have the hardware to make things exclusive, and I highly doubt their master plan is to suddenly try to make all EA Luna games streaming exclusives, so it can be smoother for them.

But obviously there are very real concerns about Amazon’s reach in society as a whole and this is just another example of those pervading every industry in a major way. We could be heading towards a situation where you can read a review of the new Dragon Age game (owned by Amazon) written in the Washington Post (owned by Amazon) while you watch gamers stream it on Twitch (owned by Amazon) ) before deciding to order a copy yourself…on Amazon.

We should have more information on this as the day progresses, as Amazon and EA either comment or not on the situation, or prepare a big announcement. EA stock is up 14% pre-market on rumors alone. More soon.

Follow me on Twitter, Youtube, Facebook and instagram. Subscribe to my free weekly content newsletter, God rolls.

Pick up my sci-fi novels Herokiller Series and The Earthborn Trilogy.

Share.

Comments are closed.