Playdom Acquires Metaplace, Deja Vu Again

Playdom has acquired Metaplace, it’s Nth purchase in the past 12 months. Seriously, they have purchased so many social game developers in the past year I’ve lost count. Suffice to say, they are averaging at least acquisition a month.

Normally, I would question whether Playdom is purchasing the company because it is valuable or because it’s there. In this case, I actually think they are buying a company of significant value.

Inside Social Games has paid homage in its article to Ralph Koster, a lead game developer who has worked as designer and creative for a number of multiplayer online games, including Ultima Online and Star Wars Galaxies. The former game was revolutionary for its time, the latter. . . eh. It was actually a bit of a critical and financial disappointment.

Since Koster is getting kudos, I would be re-miss not mention that by acquiring Metaplace, Playdom also gets co-founder John Dohnam. I used to work with John Dohnam a long time ago at Simutronics (leading developer of text-based and graphic MMOs) and he’s a rock star. So congrats to Metaplace and congrats to Playdom.

Now that I got that out of the way, it’s time to call a spade a spade. Metaplace raised $6.7 million to create a virtual world platform. Virtual worlds bombed, Facebook games rocked, and Metaplace wisely made the move to Facebook.

The games they have launched have been well received by critics (e.g., Gamezebo) but only moderately successful, tapping out at about 1.5 million MAU’s at their height. That’s good, but not Zynga good.

My guess is that were having money issues, scared of the current market conditions on Facebook, encouraged by anxious investors to sell. No price was given but if Metaplace raised $6.7 million, they sold for a minimum of $6.7 million + 1 penny, or $10 million maximum (combination of cash and stock options) to make the founders and investors feel OK about selling.

For Playdom, this is yet another purchase of a struggling yet talented game development group. Playdom is making a bet. They buy talented game developers, plug them into Playdom marketing and distribution channels, and create hit machines.

I have openly questioned many of their purchases. This one, however, I don’t. Metaplace creates good Facebook games. With Playdom’s help, this deal could be a winner.

The big issue is that at some point, buying an average of one games studio per month creates more trouble than it is worth.

Playdom is conducting a grand experiment with its acquisition binge. They are either going to successfully buy their way to the top or become a poster child of everything that went wrong in social games.

Only time will tell. And the clock is ticking…

Content writer

Notify of
Inline Feedbacks
View all comments
More content