Take-Two to Acquire Zynga - App Store News

January 14, 2022

Take-Two to Acquire Zynga - App Store News

Take-Two Interactive Merges with Zynga Inc.

Earlier this week Take-Two – the parent company of Rockstar Games, who produced one of the most popular console games Grand Theft Auto – announced their plans to acquire Zynga. Another big name in gaming, Zynga owns some of the most iconic mobile gaming titles like Farmville and Words With Friends. This is another signal that large game publishers are embracing the mobile gaming market, which is the largest growing sector of the video game industry.

Game Titles

This is an exciting development for any video gamer, as being able to take your favorite console games to your mobile device can be rewarding when done well. Take-Two should be aware, however, that the App Store landscape is not the same as traditional storefronts. To get their growing mobile games collection in front of eager gamers, they'll need a solid ASO strategy.

Of course, Zynga's expansive library of popular mobile games are well known by many, but this new merger could create some great games that run the risk of not being discovered, despite the recognizable name attached. One recent example is the new Netflix games collection that arrived late last year; even though these titles are getting good reviews, they are not getting seen by many potential users.

Take-Two has not announced specific titles that they intend to bring to mobile yet, however with games like BioShock, Red Dead Redemption, and Grand Theft Auto – "the list is endless," says Take-Two CEO Strauss Zelnik.

Take-Two’s subsidiary Rockstar Games already has quite a few well-known titles available on mobile from the Grand Theft Auto franchise. These games are easily found when searching their branded names, but for more generic searches like "driving games" their ranks in search drop below the 200 spot.

Relying only on branded searches and users who are already familiar with a game through another console severely limits a publisher’s opportunities for acquiring new users. Even though you'll be hard-pressed to find somebody who's never heard of Grand Theft Auto, some more obscure titles that Take-Two has produced may not see a lot of traffic. It's important to round out an app’s keyword footprint to readily attract users from all angles. With a world class mobile publisher like Zynga, Take-Two has the opportunity to dominate the mobile gaming space with the right ASO tools.

The Deal

It should be noted that this deal has not been closed yet, and that Take-Two's proposal includes a “go shop” clause. This means that Zynga has 45 days to shop for a better deal than Take-Two's $12.7 billion offer. This looks promising, however Take-Two was also originally set to acquire Codemasters before EA games closed the deal first.

Take-Two isn't new to mobile gaming, but if this acquisition goes through, this will be their largest addition to mobile yet. Take-Two acquired the mobile studio Playdots in 2020, followed by Nordeus in 2021. Shortly thereafter, Take-Two announced their T2 mobile games division in Q3 of 2021.

The Mobile Gaming Industry

The rising interest in mobile gaming has huge impacts both on the largest video game publishers and the mobile gaming market. In recent years, this industry has gravitated away from a dependence on casual games toward more traditional genres. As mobile technology becomes more advanced, the barriers to console quality mobile games start to get smaller.

This is leading to exponential growth in the mobile gaming market, which was valued at $121 million USD in 2020. The annual growth rate is projected to increase by 12.3% over the next five years. Estimates suggest that this market segment will reach a valuation of nearly $125 million USD this year, with the average revenue per user at around $65 USD.

As more developers and publishers flock to the iOS App Store and Google Play Store with new games, the competition will grow even more fierce. Mobile game developers need to be sure that they have a solid organic presence in the both of app stores to avoid losing ground in the flood of games.

Overall

This week, game publisher Take-Two announced their plans to purchase Zynga for $12.7 billion USD. Zynga has 45 days to search for a better offer, after which we may see some of the biggest names in gaming be released for Apple and Android devices. This may have a sizable impact on how much the now $121 million dollar mobile gaming industry grows in valuation over the next few years.

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