Report: Microsoft missed out on acquiring PopCap Games

On Tuesday, Electronic Arts officially announced that it was acquiring the successful casual game developer and publisher PopCap Games. The asking price for the Seattle-based company will be at least $750 million with possibly more if PopCap reaches certain unannounced revenue targets. But today it was revealed that Microsoft had at least two shots at acquiring PopCap, most likely at a smaller price than what EA paid for this week.

The Wall Street Journal reports that way back in 1999, PopCap offered to sell off the rights to its Bejeweled puzzle game for a mere $35,000. Microsoft declined the offer but instead licensed the game from PopCap for $1,500. In the end PopCap kept the rights to one of the most popular of its game series. The company said a number of months ago that it has generated sales of over 50 million copies between the many different versions of the highly addictive puzzle game series.

The story also reveals that in 2002 Microsoft came back to PopCap for a full acquisition offer to the tune of just $5 million. At the time PopCap said it had about $4 million in the bank. The second Microsoft deal also didn't happen. After that deal fell apart, the privately owned company continued to release highly popular puzzle and casual games such as Zuma, Peggle and of course Plants Vs Zombies. In 2009 it raised $22.5 million in venture capital fund and was planning to launch an IPO sometime later this year before Tuesday's acquisition deal with EA.

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18 Comments

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What a shame. At least under Microsoft they would have left PopCap alone to continue building cool games. EA is going to destroy that company.

M_Lyons10 said,
What a shame. At least under Microsoft they would have left PopCap alone to continue building cool games. EA is going to destroy that company.

Go on! I'd love to hear your actual thoughts other than just EA FUD.

SK[ said,]Interestingly they seem pretty clear that Popcap will not change how it functions and produces its games. Time will tell. I certainly hope not...

That may be part of the contracts folk sign before getting consumed by EA, but it doesn't last forever. Day to day development operations may stay the same, but decision making will change. It'll happen slowly, but PopCap will become EACrap and rush substandard products to market, and eventually will have to change products to so they are more acceptable to a wider audience (even if it means destroying the original audience).

It will probably take less than two years before we see new titles from “EACrap” that cost $20-$30 for the base game and then $400-$800 for content that should have been $30. EA has done it before, and will do it again.

At best PopCap will take 10 years to be completely destroyed from what it is now, as developers and the original folks who sold the company slowly lose control or abandon it in favor of new ventures or disliking EA's direction. EA knows how to buy talent, abuse that talent, and toss it aside after damaging the people who worked for them. EA history shows it to have a major burnout factor. Oh, and the people at the head of EA do not have the vision of the companies they buy, which is another reason games from that team can eventually fall short of being great.

That said, when you want to do something new, selling yourself off to EA and slowly jumping ship is a very profitable way to do so. I can't say anything bad about PopCap for selling themselves to EA... it's just sad that it was EA.

K

Popcap would not be what it is today had Microsoft acquired it. And, now that EA has acquired it, it will not be what it is today in the near future.

im glad microsoft didnt get it they are bying up to much stuff and gaining to much info and power per every buyout (one of the latest being skype which i am sad about cause now they will be recording my calls) so i think this is good...

SPEhosting said,
im glad microsoft didnt get it they are bying up to much stuff and gaining to much info and power per every buyout (one of the latest being skype which i am sad about cause now they will be recording my calls) so i think this is good...

wtf?? they will be recording your calls?? They post a patent of the ability to store call information and you take that as microsoft is going to listen to your calls.. Its obvious to me that this sort of technology is for big companies with their own servers that want to keep tabs on their employees.. Just like microsoft probably has technology to track websites but it is for use within companies to make sure people arent just on facebook all day instead of working.

of course they will be obviouslt they are not going to have tons of people listening to every word but they have filters to pick up keywords.... and yes I did take what you said into account and something tells me they will sell something like this to people but unless the big companies are recording there employees data and sending it to one massive data center (as the technology is for over web transfer of this info as well) dont get me wrong i can see your point but this is a big brother world now.

lol.. not buying a casual game company for 750 million is missing out? I dunno you cant really compare an offer in 2002 with an offer in 2011.. The only reason PopCap is so expensive now is because of things like Facebook, Iphone and other platforms that didnt even exist back then.. If casual gaming didnt catch on then they would of become bankrupt

Lachlan said,
lol.. not buying a casual game company for 750 million is missing out? I dunno you cant really compare an offer in 2002 with an offer in 2011.. The only reason PopCap is so expensive now is because of things like Facebook, Iphone and other platforms that didnt even exist back then.. If casual gaming didnt catch on then they would of become bankrupt

Of course it's missing out, with the popularity of casual gaming nowadays they would have been sat on a goldmine.

Lachlan said,
lol.. not buying a casual game company for 750 million is missing out? I dunno you cant really compare an offer in 2002 with an offer in 2011.. The only reason PopCap is so expensive now is because of things like Facebook, Iphone and other platforms that didnt even exist back then.. If casual gaming didnt catch on then they would of become bankrupt

You missed the point. It could have been bought for 35k in 1999 when PopCap offered the deal to MS.

Lachlan said,
lol.. not buying a casual game company for 750 million is missing out? I dunno you cant really compare an offer in 2002 with an offer in 2011.. The only reason PopCap is so expensive now is because of things like Facebook, Iphone and other platforms that didnt even exist back then.. If casual gaming didnt catch on then they would of become bankrupt

The whole point was the fact that they could have bought the company twice at substantially less than what it is now going for, so yes they did miss out by not offering the right amount of money originally.

reverseswing said,

You missed the point. It could have been bought for 35k in 1999 when PopCap offered the deal to MS.

ya . they could of bought one of their games . but the future may not of been the same with microsoft in control of that game considering most of the money made from it was the expansions and different versions of the same game..

Lachlan said,
lol.. not buying a casual game company for 750 million is missing out? I dunno you cant really compare an offer in 2002 with an offer in 2011.. The only reason PopCap is so expensive now is because of things like Facebook, Iphone and other platforms that didnt even exist back then.. If casual gaming didnt catch on then they would of become bankrupt

I dont get it though. sure, microsoft missed out on buying a company for.. 5 million that now costs 750 million? If microsoft had bought the bejeweled game perhaps it wouldn't have been as popular in facebook as it is today.

Lachlan said,
lol.. not buying a casual game company for 750 million is missing out? I dunno you cant really compare an offer in 2002 with an offer in 2011.. The only reason PopCap is so expensive now is because of things like Facebook, Iphone and other platforms that didnt even exist back then.. If casual gaming didnt catch on then they would of become bankrupt
true without the handheld gaming introduced by the iphone this company would be toast