Sega, the Japanese video game and entertainment company, is reportedly on the verge of buying Rovio Entertainment, the creator of the popular mobile game franchise, Angry Birds, for a staggering one billion dollars. If the reports are accurate, this would be a significant development in the video game industry and could have far-reaching implications for both companies.
Angry Birds, the original mobile game, was a runaway success when it was released in 2009. It was the first mobile game to reach 1 billion downloads and was certified by Guinness World Records. However, the franchise has been in decline since its peak in 2014. Despite this, the Angry Birds brand remains one of the most recognized and beloved in the video game industry.
The success of the franchise also led to the release of two Angry Birds movies. The first movie, released in 2016, was a box-office success and remains the seventh highest-grossing video game film of all time. The sequel, released in 2019, was not as successful. Rovio also made the decision to pull its original Angry Birds game from the Google Play Store earlier this year due to its impact on the company’s broader game portfolio.
In this article, we’ll take a closer look at the potential acquisition of Rovio by Sega, what it could mean for the companies involved, and the wider video game industry.
The Potential Benefits of the Acquisition
On the surface, the potential acquisition of Rovio by Sega seems like a smart move. Sega is a well-established player in the video game industry with a diverse portfolio of games and franchises, including Sonic the Hedgehog, Yakuza, and Total War. By acquiring Rovio, Sega would be able to add a hugely successful franchise to its portfolio and gain access to Rovio’s expertise in mobile game development.
The acquisition would also provide Rovio with access to Sega’s vast resources and expertise in game development. Sega has a strong track record of developing successful video game franchises and could provide Rovio with the support it needs to revitalize the Angry Birds franchise.
Furthermore, the acquisition would give Sega a foothold in the lucrative mobile game market, which is expected to generate $98 billion in revenue by 2025. Sega has struggled to establish a strong presence in the mobile game market in the past, and the acquisition of Rovio could be the key to unlocking its full potential in this area.
Potential Risks of the Acquisition
Of course, no acquisition is without risks, and the potential acquisition of Rovio by Sega is no exception. One potential risk is that Sega may overpay for Rovio, especially given the decline in the Angry Birds franchise in recent years. If the acquisition does not result in the desired return on investment, it could hurt Sega’s financial position and damage its reputation in the video game industry.
Another risk is that the acquisition could lead to creative clashes between the two companies. Rovio has a unique culture and development process, and it remains to be seen whether Sega would be able to integrate successfully with Rovio’s team and maintain the quality and vision of the Angry Birds franchise.
What Does This Mean for the Video Game Industry?
The potential acquisition of Rovio by Sega is just the latest example of the consolidation taking place in the video game industry. As the industry continues to grow and mature, we can expect to see more mergers and acquisitions as companies look to gain a competitive edge.
The acquisition would also highlight the importance of mobile games in the video game industry. Mobile games have become a significant revenue driver for the industry, and their popularity is only expected to grow in the coming years. Companies that fail to establish a strong presence in the mobile game market may find themselves at a significant disadvantage
