Microsoft to Acquire Electronic Arts to Resolve First-Party Games Shortage?
Microsoft will reportedly acquire Electronic Arts in an attempt to boost its production of first-party video games for its Xbox platform.
In terms of hardware products, it is safe to say that Microsoft has caught up with its competitors in the video game industry. Proof to that is the release of its Xbox One X, which many regard as the most advanced gaming console to date when it comes to technical specifications as well as in frame rate and fidelity capacities.
However, Xbox and Microsoft Studios still have a lot of work to do to offer the same deep lineup of first-party video games the way Sony PlayStation and Nintendo have. With that, there are speculations that Microsoft is likely to acquire Electronic Arts.
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In a comprehensive analysis of Xbox's future in the video game industry, Polygon reported that "a reliable source close to Microsoft" claimed that the company was considering sealing major acquisitions.
There are several other video game outfits that Microsoft is reportedly considering to acquire such as Valve and PUBG Corp. but the most recent - and the one deemed more likely - is EA.
It was previously reported by several publications that Microsoft has a cash reserve of up to $138.5 billion as of September 2017, while EA is valued with a market capitalization of around $39.1 billion as of the moment. Comparing both figures would lead one to believe that Microsoft will have no issues, financially, in acquiring an already-established video game-making company like EA.
In the same Polygon report, several analysts agreed that Microsoft needed to make something happen as soon as possible to remedy its looming issues in the video game industry. According to Joost van Dreunen, SuperData Research's CEO, Sony is expected to fight even harder "at this stage of the hardware cycle," which puts Microsoft in a tight situation considering that their "exclusives portfolio is pretty meager."
With all that being considered, van Dreunen added: "Because of where we are in the lifecycle of all these things, I'm expecting to hear Microsoft announce something very, very shortly."
Neither Microsoft or EA has addressed the acquisition rumors.
Meanwhile, Microsoft seems to be trying to slowly remedy its issues with first-party titles. Just last week, the company announced that all of its upcoming Microsoft Studios games will be automatically added to its Netflix-like platform called the Xbox Game Pass as soon as they are released.
However, this was not received well by many retailers who commented that the move would immediately hurt their businesses, prompting them to stop selling Xbox games, consoles, and accessories.
