Earlier this week, a group led by a Saudi Arabian investment fund (PIF, Silver Lake, and Affinity Partners) announced their plans to buy EA for $55 billion, which a lot of analysts thought was higher than expected. Naturally, they're planning to not only make their money back, but also turn a nice profit.
In an interview with GamesRadar, three prominent analysts give their views on the mega-deal. One of them is the well-known Japanese Kantan Games analyst Serkan Toto, who believes that EA will now be less willing to take risks and will focus on things that generate high returns. In plain language, this means safer bets and "an even stronger focus on evergreen IPs, blockbusters (fewer but potentially bigger games) and live services - at the expense of riskier projects, new ideas and innovation."
The second person interviewed was David Cole, head of market research and consulting firm DFC Intelligence, who took a similar stance:
"EA will double down on live services and sports games that have a fairly predictable revenue stream and profit margin. Long term, they may look to do more strategic moves that do not pay off immediately but position them for future growth. Short term, they may look to sell off non-crucial assets and smaller IP."
Finally, we have New York University Stern School of Business professor Joost Van Dreunen. And... he also expresses similar views, believing in a focus on major licenses and less on other areas going forward:
"EA will probably consolidate underperforming studios and double down on its sports franchises (which generate 70% of earnings) while potentially spinning off or closing teams working on lower-margin titles. I do not expect the new owners to care much for shelved IP other than selling them off to pay down some of the debt."
According to these gentlemen, it seems unlikely that EA will want to invest in uncertain and smaller projects going forward. This leads one to suspect that the former BioWare employee who did not believe that the new EA would be interested in keeping BioWare may in fact be on to something. And what will happen to, for example, Hazelight's co-op titles or more experimental games such as Immortals of Aveum and Tales of Kenzera: Zau remains to be seen.
What do you think about this? Will EA become more of a sports factory now with an increased focus on live service?