Embracer Group is showing why companies that cannot afford to purchase so many studios should not be allowed to make so many purchases.

Consolidation/merger is almost always about keeping or increasing revenues, while cutting costs (incl. layoffs). It’s the “have your cake and eat it too” of corporate strategy.

From the consumer’s point of view, there is usually less competition later, meaning prices often increase or quality drops.

For employees of that industry, less options to find other jobs.

I worked on a giant merger few years ago, left before the closing. Talking to colleagues, everything is more chaotic now, multiple leadership and direction changes, quality issues, more customer complaints.

This is of course just my experience, but there is a lot of data how most mergers lack to deliver the long-term value that was expected of them: https://www.mckinsey.com/capabilities/people-and-organizational-performance/our-insights/a-mckinsey-perspective-on-creating-transformational-value-from-mergers

My conclusion after a decade in management and consulting roles is that big mergers should be much more regulated, and very rarely allowed.

They had promise when they were thq. Then the name change to Embracer seemed to hint at some bullshit. Well here we are. A bunch of my favorite studios going away thanks to Embracer. They were there ones saving these studios years ago.

This is the best summary I could come up with:

Last week we covered Embracer Group doing personnel cuts at Tiny Tina’s Wonderlands support studio Lost Boys Interactive.

They have already suffered immensely due to the horrible leadership of the upper management and Bobby Kotick which even led to an investigation by the state of California for sexist work practices.

Employees were holding nearly weekly strikes asking for the CEO to resign his position, and gamers all over the world were boycotting Activision Blizzard and King games due to their geopolitical choices.

Employees had hope that they could finally have a positive work culture and maybe get back to making games they love instead of being forced to push forward the massive machine of Call of Duty.

I don’t think Microsoft will look to purchase another publisher until there is a significant change in the FTC and CMA leadership, but that will ultimately be a decision for Xbox lawyers and experts to make.

The truth of consolidation is that there will always be risks and downsides, but if we see another rising star like Embracer Group come around purchasing dozens of studios without as much as a road map for the company’s future, hopefully, we will raise concerns before it is too late.

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I just Dark Horse doesn’t get effected by this whole thing.