Game developers are growing more opposed to major acquisitions: 'Too much control in one company's hands is never a good thing'

Gaming IndustryGame DevelopmentGame developers are growing more opposed to major acquisitions: ‘Too much control in one company’s hands is never a good thing’When you purchase through links on our site, we may earn an affiliate commission.Here’s how it works.

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(Image credit: Deviantart user Deniszizen)

Money money money.

The last couple of years have seen some blockbusters deals in the games industry. Microsoft’s acquisition ofActivision Blizzardis obviously the biggest of them all, but Sony’s buyout ofBungieis up there too, and even (relatively) smaller deals, like NetEase’s purchase ofQuantic Dreamor Nacon’s takeover ofDaedalic, can’t be overlooked. And while we on the outside can debate the relative merits of this industry consolidation, GDC’s latestState of the Game Industry surveyindicates that it’s making people who actually work in the business a little nervous.

That shift in attitude is understandable. 2023 was a brutal year for layoffs in the games industry, and 2024 has yet to show any signs of being better. Many of those cuts have been laid at the feet of over-aggressive expansion during the early days of the Covid-19 (of course, for the most part the executives who made those decisions still have jobs) but one respondent pointed out the particular egregious case ofEmbracer Group, a Swedish holding company that ballooned into a gaming behemoth through a multi-year acquisitional rampage, only to put hundreds of people out of work and close multiple studios when a single investment deal—a very big deal, yes, but still just one—fell apart.

“I think the recent Embracer fumbles sums it up,” one respondent wrote. “Once a huge publicly traded company buys up large swaths of an industry, it will inevitably end up creating redundancies and placing innovative, more ‘exploratory’ studios in a position where they’ll never be seen as profitable enough for shareholders.”

42% of respondents took a more middle-ground approach, saying major acquisitions will have a “mixed impact” on the business. Some survey respondents acknowledged that acquisitions are often an overall positive from a business perspective, but are also not always great for individual developers or games that don’t have huge audiences.

“Obviously, there have been a great many layoffs, and the centralization of media under large umbrellas—as is happening with Disney as well—is not good for media because it creates a certain sameness,” one respondent said. “Many products, all competing with the same risk aversions and pillars of creative values. Less room for maverick upstarts and interesting one-offs.”

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“It’s not great from a competition standpoint,” another said. “However, as a small company just trying to make ends meet, there is an allure in making oneself desirable for acquisition, since it can take pressure off management and make money issues a lower priority in the short term.”

Concern about the negative impact of acquisitions and consolidation was also reflected in a question about potential layoffs: Just over one third of respondents said they didn’t think their company would see layoffs at some point over the next year.

(Image credit: GDC)

GDC State of the Game Industry Survey 2024 - graph on levels of concern about possible layoffs over the next 12 months

Interestingly, the survey also reflected mixed attitudes about what individual developers can do to protect themselves from the negative fallout of big-biz deals. 57% of respondents said the industry should unionize, up slightly from the 53% who were favor of increased unionization in 2023, but that support was decidedly split along age lines: 72% of respondents aged 18-24 supported unionization, but that number declined steadily as age groups rose, to just 29% support among those aged 55-64.

(Image credit: GDC)

GDC State of the Game Industry Survey 2024 - graph on levels of support for increased game industry unionization

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