Are Mergers Resulting in Publishers That Are Too Fat?

By Matthew Kellar | March 4, 2008

Anyone with an eye on the industry can see that videogame publishers have been merging quite often in recent years. Squaresoft and Enix became bedfellows. Namco and Bandai joined forces. Sega began making kissy faces with Sammy. However, it wasn’t until Activision merged with Blizzard that the real repercussions of this trend required our utmost attention.

Not to be outdone, it appears that EA is now on the prowl to hold onto its spot as the top publisher. With the recent acquisitions of Bioware and Pandemic, and offers to consume and take good care of Take Two, it seems EA may become more formidable than ever. Also, it would be a mistake to forget the portion of Ubisoft shares currently possessed by EA .While the attempted acquisition of Take Two seems to have fallen through for EA (for now), one might find it difficult to refrain from asking “What if?”

What would this mean for gamers? An optimist would point out that a pooling of resources between two large companies can lead to a combination of creative minds that can work together to truly innovate and advance the industry. Also, with a large company, the publisher can afford to take risks on new ideas that would be unthinkable for a smaller company that has no margin for failure.

There is, of course, always a pessimistic viewpoint. What if smaller publishers find themselves without the means to make a profit in the face of insurmountable competition? How will small creative teams find a way to get their product into the hands of a consumer who has never heard of them or the franchises they create? Can production teams become so big that they lose focus or have breakdowns in communication? With a lack of a variety of competition, will large publishers run their franchises into the ground?

These are tough questions to answer. I find myself to be a little optimistic in that I believe these “mega-publishers” can organize themselves in such a way that they have many small creative teams while retaining the increased financial backing of a large publisher. Criterion has mentioned in the past that being acquired by EA has been beneficial to the team and the products they create. I believe Bioware and Pandemic will be privy to the same kinds benefits, and I doubt EA will make any attempts to make major changes to the way these developers do business given the stellar track records of these game-makers. However, if these “mega-publishers” do place pressure on their developers to force their games out the door on an annual basis regardless of quality, I believe the gaming community will eventually tire of retreads and cyclical releases of the same game. If the large publishers refuse to take chances on innovation that only they can safely take, it would only be a matter of time before consumers speak with their wallets and stop buying their games. At least I hope so.