It can seem so counter-intuitive: how can a company that builds its business around free-to-play apps become one of the most profitable forces in the mobile gaming sphere? But the allure of in-app purchases that can make a fun app that much more fun to play is a tough one for many of us to resist, and a dollar here, or five dollars there, quickly begins to add up. King Digital knows this all too well, and titles like its immensely popular Candy Crush Saga have helped the company rake in billions over the years. Today it finds itself moving into a new home under the banner of Activision Blizzard, as the software giant acquires King in a $5.9 billion deal.
While that sounds like mountains of money to us, it could prove to be a really smart move for Activision Blizzard, helping the company to secure a strong new venue stream on the increasingly important mobile front.
Then again, fortunes rise and fall swiftly with mobile games, and just because an app is popular today is no guarantee that it will continue to be a profit fount tomorrow. We’ve already seen some apps with similar popularity to Candy Crush lose significant fractions of their user base in recent years, as devs struggle to keep users engaged.
Clearly, Activision Blizzard believes King and its properties will be able to buck the trend and remain relevant, but time will ultimately tell just how wise an investment this was.