Expert Analysis: Google-Valve deal

17th Sep 2008 | 11:53

Expert Analysis: Google-Valve deal

Games industry analysts and PC specialists consider the possibilties

So Google is rumoured to be buying PC gaming specialists Valve, as we reported earlier. TechRadar polled a number of PC gaming specialists and industry analysts to get the first responses to what could be the biggest gaming news of 2008 (which we will no doubt find out later today, when Valve's west coast US office wakes up...)

"It's certainly an interesting move, should it prove to be true," noted Piers Harding-Rolls, an analyst from Screen Digest

"Google has been rumoured to increasingly be looking at the game space and of course has already done some work in virtual worlds," Harding-Rolls added.

"Valve is active in the online games space, with its online distribution platform Steam having gained influence over last three to four years, with Valve also signing lots more content from third parties, in addition to its own games."

Google Steams ahead

"If this is true then Google will be after Steam, pure and simple. It's a ready-made install base, a low maintenance system and an almighty cash-cow," says PC Zone editor, Will Porter.

"It's worth noting that the corporate mentalities of both Valve and Google aren't a million miles away from each other either."

Should the deal go through, Google would get access to Valve's line-up of incredibly strong IP (intellectual properties), including Half Life, Counter-Strike, TeamFortress, Portal and the soon-to-be-published Left 4 Dead.

Unparalleled PC gaming experience

"The development expertise Valve has is unparalleled in the PC space," notes Harding-Rolls, though he adds, cautiously, "I'm not completely au fait with Google strategy and the traditional gamespace is quite a different thing for Google.

"So I can't really comment much more right now on the 'fit' with Google...Google is community orientated so there is the alignment in that Google is investing in online interactive communities, but buying into traditional games publishing and retail would be a new strategy."

Nick Gibson, another games industry analyst from gamesinvestor.com, added that: "Google's involvement with gaming has been on the periphery of the industry to date with games ad technology and the Lively virtual world but the rumours have persisted that it has been considering a more concerted move for quite a while."

Hardcore versus mass market

The key area of difference between the two companies is the focus on the hardcore gamer and the mass market in the case of Valve and Google, respectively.

"Whilst Valve has been a pioneering US games developer, digital distributor and games service provider, the core of its audience remains hard-core gamers and this would be at odds with Google's historic mass-market global focus," notes Gibson.

"However, Valve is also a hugely profitable business that is growing rapidly and that alone may be sufficient rationale to justify paying what I imagine would be a relatively substantial valuation."

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