German newspaper and media giant Axel Springer AG has taken a majority stake in the MMO provider Gamigo. Gamigo publishes a series of MMO titles, including >“Last Chaos” and “Fiesta Online”, the racing game “Level R” as well as the golf game “Shot Online”. These are then distributed free over the internet or via magazine cover discs, and monetised with subscriptions or purchase of virtual goods. Axel Springer had held shares in Gamigo since 2000. Before the purchase of the additional shares, it owned 47.4%, and now owns 94.8%. The remaining shares are owned by Gamigo’s CEO, Sven Ossenbrüggen.
Acquisitions of new media companies by old media giants – Axel Springer AG has been around since the 1940s – are always exciting because of the vindication they are perceived to bring. The more traditional, 2D end of new media has seen a lot of this: MySpace by Murdoch, Last.fm by CBS to name just a couple of the big ones, with countless other far smaller acquisitions. However, the same has not been the case with virtual worlds and MMOs. Perhaps they are seen as being too close to gaming and too far away from content for old media to be interested, although we know in reality that the distinction is irrelevant, and in any case content is just as crucial in virtual worlds and MMOs as it is with MySpace. With acquisitions like this, however, the tide of perception can start to turn from geeky fad to serious business.
Of course, that’s not why Axel Springer bought Gamigo; they bought it because of their ‘digitization offensive’: Dr. Jens Müffelmann, Director of the Corporate Division Electronic Media of Axel Springer AG explains the reasons for the transaction: “Gamigo operates in a fast growing market segment, it will quadruple sales this year and it is profitable. Due to that online gaming is to become an important pillar within the digitization offensive of Axel Springer.” I suspect that changes in Gamigo will not be particularly dramatic, since Axel Springer has had long involvement, the company remains separate and the CEO still in place. There may, however, be efforts to do something clever with advertising, since it could potentially attractive to have a unified campaign across different forms of media with the same company.
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