There are rumors that Amazon is bidding to buy EA, but this could be the start of a slippery slope towards industry monopolization.
While there are conflicting reports about Amazon buying EA, the idea itself is a stark warning in the current spending spree by major publishers.
It seems that the industry is being dismantled and consolidated under the umbrella of large corporations. It all started small when Microsoft began trying to compete with Sony's proprietary catalog by buying several smaller developers. While the company's 2018 acquisition of industry favorites like Ninja Theory, Double Fine, and Obsidian Entertainment seemed like a series of monumental moves, it's positively picturesque in the current climate.
Microsoft's $7500 billion purchase of Bethesda felt out of character; a change in the market where previously unthinkable purchases were at stake. This was not confirmed until Microsoft dug into its pockets again to buy Activision Blizzard for €68.7 billion. Now, it appears to be open season with mega-corporations moving into bigger and bigger games.
Since then, we've seen Sony retaliate by buying Destiny 2 creator Bungie for a relatively cheap €3.7 billion. Meanwhile, the Embracer Group bought the western side of the development from Square Enix, taking Eidos and Crystal Dynamics for €300 million.
bad Company
That is the climate in which this news of Amazon's purchase of EA finds itself. The dinner bell has rung and it seems that everyone is trying to get a piece of the video game industry.
For me, this whole situation sucks. Whether it's Amazon, Microsoft, Sony or Tencent, industry consolidation is worrying. A future in which a handful of the largest companies on the planet own the entire mainstream gaming market is bad in almost every way. It is restrictive for creativity: the variety of voices and the art that is created. It also opens the door to increased monetization.
In my opinion, these free expenses are bad across the board, but some proposals are better than others. Microsoft's attempt to buy Bethesda and Activision almost felt like the end of a console war and the start of something much bigger. Now, however, we enter the infinity war of video game capitalism.
the skin in the game
And it goes to the heart of why any proposed purchase of EA by a megacorporation with no investment in games, or in Amazon's case, a flimsy proposal, is incredibly concerning. Xbox and PC games are a big part of Microsoft's business. PlayStation is one of Sony's biggest tech brands, if not the biggest. These companies have a vested interest in the well-functioning gaming industry. While I don't trust the players to do well, they have their skin in the game for the long-term health of the industry.
The same cannot be said for companies like Amazon, Apple, Disney or others. Your business does not live or die by your gaming adventures. Their interest stems from the fact that it is a booming market. Google Stadia is about to fade into obscurity, but that's not going to break the tech company. Google can shut down Stadia tomorrow and be fine for the long haul. If Microsoft's gaming divisions were to collapse, it would be a huge blow to the company.
Amazon is already in a similar position to Google. The launch of Amazon Luna didn't exactly set the world on fire. The service is still available, but it's far from being a major player in gaming and could easily run out of steam.
That's why Amazon's impending purchase is so much more worrisome than Microsoft's acquisition of Activision Blizzard. It seems like an expensive fantasy, rather than a central pillar of your business. What if the industry experiences a recession? Will Amazon really stand its ground when EA's survival is no longer essential to its own success as an entity? Or will you shrug it off and destroy the business and call it a failed business?
a mass effect
As of 2021, EA had approximately 12 employees (via MacroTrends (opens in a new tab)). If Amazon decides it's done experimenting, those jobs are gone. Huge, probably unsustainable, numbers of potential employees are thrown into the labor market fray. In fiscal year 900, EA had (opens in a new tab) revenue of €2021 billion. What happens to this money? Maybe it will go to other publishers, but much of it could easily evaporate from the industry.
As dedicated brand Twitter users rage over who should buy Konami, Rockstar, Ubisoft, or whoever is left standing, there's one important thing to remember: In the midst of all this are tens of thousands of jobs, all affected. because of the uncertainty. While some will benefit greatly from these buybacks, most, especially those at the bottom of the totem pole, are facing new concerns.
It's no secret that EA's image isn't popular with gamers, but a reality where it's definitely shutting down is much harsher and more depressing. While many see publishers as singular entities, they are largely a collection of talented and passionate individuals trapped in the posture of giants, used as currency by stock market prices. Whether Amazon buys EA or not, it's a precarious time for the games industry. I would prefer games to be in the hands of independent publishers, but if we live in a world where mega corporations have to buy out anyone who remains independent, I'd feel much better if it was those who are already deeply involved in the industry.