EA pays USD250m for Playfish - Rumour

Electronic Arts (EA) is rumoured to have bought social gaming firm Playfish for around USD250m. If true, the deal is the first major acquisition in the social gaming space and indicates the growing importance of this sector, which many say is ripe for consolidation. 

Though neither Playfish nor EA will confirm the reports, sources tell the Inside Social Games blog that a deal was done weeks ago, and will be announced in the near future. Playfish, which specialises in making games for Facebook, has seen its user base jump from 35m to 60m in the last year, and is expected to bring in as much as USD75m in revenues this year. EA lost USD6m in the quarter ending June on sales of USD816m. 

EA has fallen behind main rival Activision Blizzard, which has grown significantly by cashing in on new crazes for games such as music title Guitar Hero and the online role-playing game World of Warcraft. An acquisition of Playfish would give EA a solid foothold in one of the most rapidly expanding areas of the gaming industry. 

EA COO John Schappert recently told the Wall Street Journal that he expects consolidation in the social gaming market. He says social gaming is likely to go the way of mobile gaming, which initially hosted a large range of new competing firms, but is now dominated by established gaming firms such as EA.

An EA acquisition of Playfish might embolden rival social game maker Zynga to push for an IPO. EA was rumoured to be in preliminary talks with Zynga, but is thought to have balked at the USD1bn price tag Zynga reportedly asked for. Zynga, which is the largest firm in the social gaming sector, is reportedly earning as much as USD100m from micropayments alone. Commentators speculate the firm could go public as early as next March.