Another Studio Acquisition Story

Or a few stories really.

Acquisitions are much on my mind still and since Massively OP is still going on about the concept I’ll carry on as well.  Previously I meandered on about reasons for them and often how things can go bad.

Getting acquired can suck.

There can be a loss of prestige in not being able to make it on your own.  And, of course, there is always some loss of freedom and autonomy as you have to answer to the new owners.  Plus the company doing the buying doesn’t always know how to treat their acquisition.  Culture clash can be an issue and can lead to key developers heading for the exit.

But sometimes things do work out for the better.

For example, there was a company called Silicon & Synapse, Inc.  Founded in 1991, it did some platform ports to start off with, then moved on to a couple of original games that were published by Interplay.

A brain was their mascot, of course

The name of the company wasn’t as brilliant as the founders thought and they changed it to Chaos Studios, Inc.  However they were soon acquired by Davidson & Associates and ended up having to change their name again because somebody else held the rights to the name and they couldn’t afford to purchase them.  There was even a little story in the Technology section of the LA Times by one of the staff writers who probably drew the short end of the stick on that one.  It is short enough to quote in full. (Hopefully the LA Times won’t come after me for that.)

May 24, 1994|Times staff writer Dean Takahashi

From Chaos to Blizzard: Chaos Studios, a developer of video and computer games in Costa Mesa, has changed its name to Blizzard Entertainment.

Part of the reason is to reflect its new ownership. Davidson & Associates in Torrance, an education software company, bought Chaos Studios earlier this year in a $6.75-million stock deal.

The Costa Mesa game company, which formerly developed games for other publishers, will publish its own games as a result of an infusion of money from Davidson.

Another reason is that the rights to the Chaos name were owned by a small holding company in New York, Chaos Technologies, which also owns a video game company.

Allen Adham, president of Blizzard, said Chaos Studios couldn’t afford to pay for those rights, so the name was changed to Blizzard, which had a nice ring to it.

“We’re still the same lovable company,” he said.

We’re still the same lovable company!  That has to be one of the most low-key “before they were famous” news stories.

But look how things worked out.  Despite having been acquired just three years into their existence… and before they even had their name fully settled… Blizzard went on to be a powerhouse.  Blizzard has essentially never been a stand-alone company, not under that name.  Its success came after it was acquired.

Success grants you some power and Blizzard itself, having done well with Warcraft, was able to acquire Condor Games, renamed Blizzard North, which turned out Diablo and Diablo II.

While that turned out well initially, problems with then Blizzard owner Vivendi led key members of the Blizzard North team to leave and found Flagship Studios.  The studio was dissolved after  Hellgate: London failed to take off and some of the people from that venture ended up at Runic Games, the makers of Torchlight and Torchlight II, while key team member Bill Roper landed at Cryptic Studios.  Both Runic and Cryptic were later acquired by Perfect World Entertainment.

Some key people from Runic left PWE to form Double Damage games, and the whole dance continues on.  A few things succeed, others don’t pan out or make just enough to be of interest to another company.

And, just to bring this back to yet another small world story, Dean Takahashi, who wrote that little piece in the LA Times so long ago, is currently the lead writer for the Games Beat section of Venture Beat and was the author of three posts over there last week, one about CCP being acquired by Pearl Abyss as well as two key interviews interviews, one with Pearl Abyss CEO Robin Jung and the other with CCP CEO Hilmar Petursson.