Electronic Arts buys Jamdat

World's biggest publisher jump-starts its mobile business by acquiring wireless game maker for $680 million.

It's never been called Lasky's folly, but it could have been. In 2000, Jamdat Mobile founder Mitch Lasky ditched a cush job in Activision's executive suite for the unknown waters of mobile gaming. He started a company called Jamdat, which came out of the gate with a massive hit, the relatively archaic Snake.

Five year's later, after developing and publishing scores of mobile games, going public, and making a number of significant acquisitions to boot, Lasky and Jamdat's investors have scored big.

The company today announced it has been acquired by Electronic Arts, itself a player in the mobile space, but one that never seemed to get a mobile business model in high gear. After today, not only is EA in high gear, but it owns most of the significant turf it was unable to exploit on its own.

The merger agreement calls for EA to pay $27 cash per share and also assume outstanding stock options for a total of about $680 million, according to EA.

Industry analyst Michael Pachter of Wedbush Morgan Securities said the deal made sense for both parties. "The only company that makes sense to buy Jamdat is EA, because of scale."

According to Pachter, the move quickly makes EA a player in the space. "They don't have to reinvent wireless, and they bought Jamdat for a fair price if they intend to get big."

Jamdat also comes out having accelerated its own strategy. "Jamdat is starved for content, paying too much to others, so it's complimentary that the guy with content buys the guy with know-how," Pachter said.

In a statement, EA CEO Larry Probst said of the merger: "This is an important strategic acquisition for Electronic Arts. Together we intend to build a leading global position in the rapidly growing business of providing games on mobile phones. We look forward to the Jamdat team joining EA."

The acquisition is expected to close in EA's fiscal fourth quarter, with Jamdat founder Lasky taking the reins of the new, suddenly bolstered mobile business for Electronic Arts.

Just yesterday, a Screen Digest report outlined the tremendous growth of mobile gaming in the last year. It cited Jamdat as a dominant player in the North American market and referenced the general failure of traditional gaming publishers to establish themselves in the mobile sector.

EA closed down 84 cents to $55.75 on the Nasdaq today. In after-hours trading following the news, EA shares fell further to to $55. Jamdat shares were higher on the news, rising $1.57, or 6.9 percent, in after-hours trading.

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Discussion

65 comments
sohailstyle
sohailstyle

Shtinky *The imperial march theme from star wars plays* Haha..yeah this is sort of sad..

Irvine78
Irvine78

Why don't they just buy the moon? Then we would have to see a giant EA logo every night. And if the clouds got in the way, they would buy them and have them destroyed. Soon we will have to pay EA to take our children home from EA hospitals, because our EA health insurance companies won't pay the $5,000 EABucks fee to bring them to our EA homes. Oh well, at least I can still drink my EA-Coca-Cola and have a nice slice of EA and cheese pizza. Thank EA!

Comedyco
Comedyco

Meh, EA, u got some okay games, and u have a few really good games. Unfortunatley, u have games that blow the big one. Dam rich companies. GO UBISOFT

chrisdojo
chrisdojo

uggg..... teh EA strikes again.

owenharris99
owenharris99

Whats next for EA. World Domination? Could be!!!!!!

LordOfMidnight
LordOfMidnight

EA buys something else. Now the question is will they put houses or hotels on it? Hmm...

faster90
faster90

Instead of wasting money buying other game companies, EA should pay their employees higher, that way they might put more effort in creating better games.

NeoJedi
NeoJedi

Wow, EA is becoming quite the monopoly... erm I mean player in the gaming market... now if they could only make good games...

aka_hal
aka_hal

Night_Frost, Don't worry EA can't get Bungie. It's owned by Microsoft. I wish EA would stop buying things. They need to put more effort into improving the quality of their own games before they worry about another market.

Night_Frost
Night_Frost

If EA goes after Bungie and Ubisoft, there's gonna be a lot of ass kicking being handed out and its not the Government, EA is practically buying every company who has the best franchise, I mean, they killed the James Bond license, they killed Madden, it'll be a matter of time before they killed Halo or Killzone or Ghost Recon or DOA or Rainbow Six, even Half Life, it won't be long before our beloved franchises turn into crap, here's an idea my fellow gamers: DO NOT BUY ANY EA GAMES!!!!!! it'll definetly kill the juggernaut called Electronic Arts

Dahok
Dahok

the corporate juggernaut that is E.A. is just chugging along eventually to a lot of companies that want good money are gonna give in to those dollars signs. Get ready for a gaming monopoly down the road.

SavoyPrime
SavoyPrime

I hope Jamdat doesn't become mediocre or crappy because of their new association with EA.

alleduaf
alleduaf

oh not again..... its wal-mart!!!! AHHHHH! well, lets be optimistic, EA could be bought out by (insert little guy company name) and then they will take over the title of worlds worst game-makers. darn, no matter where you look at it we're doomed.

jj4
jj4

EA STOOOOOOOOOOOOOOPPPPPP!! U CAN MAKE YOUR OWN GAMES!! DAMMITT LIVE YOUR OWN LIFE!! All GAMERS of the World unite against this evil and stop EA from buying anymore companies or franchises such as football!!! This is not delivering a better experience for any gamer every time EA buys out another company. STOP Right Guys?

jj4
jj4

EA STOOOOOOOOOOOOOOPPPPPP!! U CAN MAKE YOUR OWN GAMES!! DAMMITT LIVE YOUR OWN LIFE!! All GAMERS of the World unite against this evil and stop EA from buying anymore companies or franchises such as football!!! This is not delivering a better experience for any gamer every time EA buys out another company. STOP Right Guys?

owenharris99
owenharris99

I really doubt they have limits. I reckon in the future theyll start taking over even companies that aren't related to games in any way. For example ford cars lol

ZakmanZak
ZakmanZak

Sheesh they are such monopolistic morons...I swear they have to have limits...

owenharris99
owenharris99

Nicolantia. What a loada crap. What EA do is just by out every other developer and publisher then ruin the franchise. EA are a bunch of wankers who couldn't actually care what the game is like, but instead just make a **** game and try and release it before christmas and be number one. What will f........ EA do next?.............Take over Rockstar. Wouldn't be surprised. There should be less EA type companies (i.e. VU) and be more dedicated developers (Team Ninja) and publishers (Take Two). F... EA and what it stands for. They never bring out a good game. I mean what f......... EA game, that has actually been developed by EA themselves (not criterion and the burnout series), has got a score of 9.0 or above on gamespot. Answer: None. Whys that? They just bring out a loada mediocre games, like i said near christmas and all year round, and try to capitilise on the fact that people will see that it says EA on the box and buy it.

Nicolantia
Nicolantia

Do you all actually think EA is stupid enough to allow themselves to get in trouble for having a monopoly? They know what they're doing a lot better than any of you know what you're talking about.

OPOLO
OPOLO

EA & MicroSoft will control everything within the next 12 years. Please, someone stop this crap B4 the government gets involved.

OPOLO
OPOLO

EA & MicroSoft will control everything within the next 12 years. Please, someone stop this crap B4 the government gets involved.

changwoua
changwoua

EA will one day buy the whole world!

tidyspidey
tidyspidey

Oh No! Another company concerned with making money!? What HAS the world come to!!?? Leave EA alone I say - yes, they make some crap, but then, they make some great games too. I hope EA buy me next......

ewjim
ewjim

Less independed company's - less good games... Almost all make EA - is clones or remakes of they own games - it's a SHAME!!!

darkheart73
darkheart73

Just when you thought the underdogs stood a chance...

owner211
owner211

EA is planning there world domination as we speak!!!!!

Opstinger
Opstinger

Jamdat...? Oh yeah... Snake... Sometimes I think EA is just buying out companies for the mere sake of buying out companies.

Donkeljohn
Donkeljohn

Oracle will buy M$ long before EA gets a chance. It will be the Redwood City rumble!

_Glitch_
_Glitch_

Another three years and the headlines will read, "EA buys Microsoft." That will be the sign that the world is truly coming to an end.

IQ138
IQ138

soon EA will pwn our soul, and you will like it!!!!!!!

CyphenX
CyphenX

Really, game making should be more independant. Every company bought by EA is going to have to comply to the buisness model. When the primary goal becomes about making money instead of making art, we will suffer. If all the money is controlled by the EA hivemind, it gives them too much power over the creative process, to process done best by an independant group. It's fairly obvious by all of the buisness moves (exclusive NFL deal, buying numerous devopling companies, now this aquisition) that EA is all about making money. An independant designer can make a game based on an artistic vision, try to find a publisher, have a few money-making tweaks proposed by that publisher, and then release something that is made to entertain. If a designer is controlled by a company like EA, there will be little to no artistic vision, just a vision for making money; the company will controll the creative process, and base it on money, not entertainment. Thus, the entire industry and the consumers will suffer. I really hope that the entire industry become more individual and personalized once again, it will really be better for everyone.

wiafs02
wiafs02

MS,SONY &Nintendo will be under EA very soon

tyko0n
tyko0n

wow like EA's crappy games arent enough on home consoles. . .now its about to be on mobile phones

LukeAF24
LukeAF24

I'm with EA. Great way for them to break into the Mobile world.

EastsideMafia
EastsideMafia

It'll be a dark day in history when we have to play Tom Clancy's Need For Speed Virtua Football Fighter Takedown: The Anniversary Collection Vol 3. Until people stop buying EA's "updated" games that they try to pass off as new, they'll keep trying to take successful franchises and put their stamp on them (translation: ruin). Wait a minute: I think they just bought my dog! He's now Fido 2007 with the revolutionary poop stick and tapeworm update!

Sturm08
Sturm08

Have you ever thought that EA might be trying to improve their games by purchasing talented studios? Criterion, DICE, Jamdat...all good developers. They aren't threatened by them.

P1zzaman
P1zzaman

Let's see EA buy out Microsoft... i just want to see.

P1zzaman
P1zzaman

(Your company) was bought out by EA. To me, that's an embarrassing announcement if anything you own got bought out by EA.

tbonetrav18
tbonetrav18

EA can buy companies because people pay $50 a year for the NEW Madden game. with only a few changes and an updated roster. WOW, People are stupid. Oh, and as far as becomming a Monoply, I am still waiting for the court cases. My guess, only about 4 or 5 more years.

Maxer9
Maxer9

I don't see the big deal. Just because the publisher changes doesn't mean much.

Greendonut
Greendonut

Why don't they just buy America?

magus704
magus704

This is utterly ridiculous, how much more money does EA need. And I still don't know how or why people still buy EA Sports games when the alternatives, like the 2K series, is always better. I mean, yeah they own football, but what about everything else?