Contact: Jarrett Streebin
If we look at the recent M&A moves by Disney, it’s clear what the media giant sees as its future. Just today, Disney divested its Miramax division, only days after its $563m purchase of social gaming startup Playdom. Taken together, these deals show that 86-year-old Disney is leaving the box office behind and betting big on social gaming.
Earlier this month, Disney bought its first social gaming company, Tapulous. The 30-person startup based in Palo Alto, California, specializes in mobile social games for Apple iPhone and Google Android devices. Playdom, which specializes in online social games, rounds out Disney’s offerings and provides it with roughly 38 million users, according to Playdom’s website. Combined, it’s likely that Disney will use Tapulous and Playdom to push its signature brands such as Marvel Comics, Pixar and ESPN to both mobile and online audiences.
It’s clear that Disney is recognizing what the rest of the industry has already seen: it has to buy its way into this market. Internet gaming acquisitions have gone through the roof this year. The 40 transactions year-to-date is more than twice the number (17) during the same period last year. Disney isn’t the only major buyer in the space, though. Playdom had inked a half-dozen deals of its own, and Electronic Arts dropped $300m on Playfish late last year, as well as reaching for IronMonkey Studios and J2Play within the last 12 months. The business of social games, although once stratified by a coterie of geeky developers, is quickly being consolidated by the major media and entertainment players.