Apple EA takeover rumor dismissed by analyst

Sources: See below.What we heard: Though an Apple offensive into the gaming market has long been rumored, speculation of such a move reemerged with a vengeance recently. Last week, as reported by Forbes magazine, the Cupertino, California-based hardware giant hired away Richard Teversham, the...

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Sources: See below.

What we heard: Though an Apple offensive into the gaming market has long been rumored, speculation of such a move reemerged with a vengeance recently. Last week, as reported by Forbes magazine, the Cupertino, California-based hardware giant hired away Richard Teversham, the senior director of business, insights, and strategy of Microsoft's European Xbox arm. The week prior, Apple hired AMD and ATI veteran Bob Drebin, designer of the graphics processor used in the GameCube, and Raja Koduri, AMD's ex-chief technical officer.

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The HR trifecta was taken by many as a sign that Apple would ramp up gaming support for the surging iPhone market and its Mac computer line. However, this week saw cable network CNBC stir up speculation that Apple might more directly enter the game industry--by simply buying Electronic Arts. In a summary posted by TheStreet.com, CNBC analyst Guy Adami is quoted as saying that, "There is chatter that Apple is eying Electronic Arts as a takeover target."

The official story: With EA's earnings report just hours away, reps for the company did not return requests for comment.

Bogus or not bogus?: Rumors of an EA buyout have rattled around since the company's stock became a bargain during last year's worldwide economic implosion. Back then, it was the Walt Disney Company--which Apple CEO Steve Jobs has a large stake in--that was pegged as the suitor.

But though EA is a major backer of gaming on the iPod, iPhone, and Mac, talk of a takeover seems a bit premature. Also, CNBC's game industry "insight" should be taken with a fist-sized grain of salt, given that the oft-ridiculed cable network recently claimed that the Grand Theft Auto franchise is "running out of steam"--while acknowledging GTAIV's 13 million units of sales in the same article.

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Indeed, one of the game industry's top analysts was quick with the "bogus" smackdown. "Sounds retarded to me," Wedbush Morgan analyst Michael Pachter told GamaSutra. "[iTunes] owner Apple could buy Warner Music for around $3 billion and control 20 percent of all recorded music. That makes more sense to their current business model than buying EA for more than twice that, doesn't it? I don't want to start a rumor, but want to point out that Apple doesn't own any entertainment content, so I don't know why they would feel compelled to enter a new business unrelated to their current product slate."

To get a taste of what gaming will be like on Apple's Mac platform, check out this tech demo from id Software's John Carmack at the 2007 Apple Worldwide Developer's Conference. The game would later be revealed as Rage, which will be published by EA.

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