GameFly Makes Digital Move With Direct2Drive Acquisition

Video game rental subscription service GameFly on Wednesday said it would acquire IGN Entertainment's game download storefront Direct2Drive. The acquisition expands GameFly's scope beyond disc-based console video games, putting the company in charge of a popular digital storefront that hosts 3,000 Mac and PC games. As part of the deal, IGN will gain a minority stake in GameFly, although IGN "will play no direct role in GameFly's operations or governance," according to a press statement. News Corp. will also take an observer seat on GameFly's board. The parties did not reveal terms of the agreement. Among IGN Entertainment's brands, Direct2Drive was a bit of an oddball -- a digital distribution business amid entertainment websites such as IGN.com, GameSpy, FilePlanet, TeamXbox and AskMen. News Corp.-owned IGN Entertainment confirmed earlier this month that it acquired Hearst's UGO Entertainment, adding UGO.com and 1UP.com to IGN Entertainment's stable of website properties. Reports claim that News Corp. is bulking up its video game news and entertainment unit in order to split it off as a separate business, possibly selling it off.