We've already heard EA's story recounting why they're interested in acquiring Take-Two, but analyst Michael Pachter gives the real scoop. And unlike many have claimed, Take-Two's appeal has very little to do with GTAIV, which he calls "gravy." It's all about the sports.
For EA, sports is enough to pay for the whole [$US 2 billion]thing. If you get rid of sports competition, you suddenly add Take Two's $US 200 million per year in sports revenue and EA doesn't compete on price anymore.
Wait...this is sounding a lot like a monopoly, isn't it Mr. Pachter?
Currently [EA and Take Two]compete in pro basketball, college basketball and hockey. So by taking out all of that, EA has a monopoly in sports. If these guys have a monopoly, they're not going to cut pricing on sports games as quickly. We've been seeing sports games come down [in price]before Christmas the last couple of years. That'll never happen again.
And once again, we've been reminded why monopolies are bad...and why we haven't played sports titles in 10+ years.
Pachter: Sports Drives T2 Deal for EA; GTA is "Gravy" [GamePolitics]