News

Activision CEO "Concerned" Over EA-Take Two Deal

| 1 May 2008 16:25
image

Activision CEO Bobby Kotick has expressed concerns about the possible acquisition of Take-Two Games by Electronic Arts, a deal that would create the largest single publisher in the videogame industry.

The $18 billion merger between Activision and Vivendi that resulted in the creation of Activision Blizzard currently holds the record as the largest deal the industry has ever seen, but Kotick appeared concerned specifically about the potential monopoly of the sports game genre by the merged company. "That's concerning, sure," he said in an interview with Reuters. "When you think about one company in control of the sports category, with no competition from anybody else, that could be a challenge."

In April, the U.S. Federal Trade Commission made a second request to EA for information regarding the attempted takeover of Take-Two, which fueled speculation about concerns over possible anti-competitive issues in the deal. While EA has said it believes the deal would not violate any anti-trust statutes, Wedbush Morgan analyst Michael Pachter said in February that the 2K Sports division was EA's real target in the takeover, adding, "By taking out all of that, EA has a monopoly in sports. If these guys have a monopoly, they're not going to cut pricing on sports games as quickly."

The EA Sports brand dominates the sports game genre, with the only competition of any note coming from Take-Two's 2K Sports division, which publishes NHL, NBA, MLB and college basketball franchises as well as other unlicensed sports games.

Disclosure(s): Strauss Zelnick, Chief Executive Officer and Chairman of the Board of Directors of Take-Two Interactive Software, Inc., is the head of ZelnickMedia, an investor in both Take-Two and Defy Media, LLC, our parent company. This article was published without approval or consent of ZelnickMedia or Take-Two.
RELATED CONTENT
Comments on