Analysts: Activision/Vivendi Merger To Bring Old IP, DS Opportunities?

Author: by Mathew Kumar, Staff

As part of an in-depth new Gamasutra feature analyzing the Activision/Vivendi Games merger, lawyer Tom Buscaglia has been speculating that the shift may lead to the analysis and resurrection of old game IP - while Michael Pachter suggests that other firms may gain DS and Wii momentum from EA and Activision's financial reliance on next-gen. Specifically, when asked what the soon to be formed company's position as the "world's largest pure-play online and console game publisher" means for the rest of the industry, Wedbush Morgan analyst Michael Pachter isn't sure it is going to have that big an impact. "Their power really only gives them a first look at all third party ideas being shopped (movie licenses, studios for sale, merger opportunities...) Before, EA got the first look. I don't know that it means much that we now have two giants instead of one. Presumably, both will continue to behave rationally, but it's possible that two giants will occasionally get tied up in bidding wars." There may be some impact on smaller developers, however. Pachter continued, "Bigger companies have higher thresholds for greenlighting games, meaning that small games likely won't appeal to either Activision or EA in the future. That leaves a gap for some smaller developers, who will have fewer outlets for their ideas." However, there may be opportunity in the "ton of IPs that one or the other company has moth-balled that the other may see some real value in," suggested game lawyer Tom Buscaglia. "I expect to see some cool IPs that we have not seen around for quite a while showing up after this while merger thing settles in." And though developers might find it harder to pitch new projects, the other publishers may find plenty of space to fit in the new industry landscape. "Competition will be conducted on two levels: a very high level (Activision and EA), and a very low level (THQ, Ubisoft and the rest)," argued Pachter. "Activision and EA will only make games they expect to sell over 2 million units every year, while the others will still try clever Wii and DS games that make plenty of money at 500,000 units." "If anything, I think that the DS may be overlooked by Activision and EA, giving THQ and Ubisoft an opportunity, and creating even greater opportunities for companies like Atari and Majesco." You can now read the full Gamasutra feature on the impending merger, including lots more detail on the statements recently made by both parties, the original agreement, and analysis of the MMO, console and PC ramifications of the deal.