Gamer Network put up for sale: Video Games Industry Memo, 30/11/2023
An unwelcome Cyber Monday sale for the games media giant
Games media biz Gamer Network put up for sale by owner ReedPop
Video games tech generates £1.3bn for wider UK economy, says boffins
Rollerdrome skates onto Game Pass as releases wind down for the year
Right you lot. It’s time for one final reminder that VGIM Game of the Year entries close on Monday 4th December.
Send me 150-200 words on any game you liked this year/Spider-Man 2 or Diablo IV specifically *nudge nudge, wink wink* by end of play on Monday.
Selected entries will be featured in my wonderful end of year round-up on Thursday 14th December, with the lucky authors receiving both a warm glow of affirmation from their inclusion and a backlink to a project/social media handle/business of their choice.
Anyway, from good news about games writing to some bad news…
The big read - Gamer Network put up for sale
Gamer Network, one of the centrepieces of the video games media landscape in the UK, has been put up for sale by its owner.
ReedPop, a leading organiser of pop culture and video games events such as PAX and Comic Con, announced on Monday that it was investigating the potential sale of Gamer Network and its digital properties following a review of its UK business.
The proposed sale covers Gamer Network’s owned media sites such as trade media outlet Games Industry Biz, consumer games site Eurogamer and PC games publication Rock, Paper, Shotgun.
It also includes its shareholdings in Digital Foundry, the performance benchmarking site, and Outside Xbox, the popular YouTube outlet. Gamer Network’s associated UK events such as EGX and MCM, however, will remain within ReedPop.
For now, details of what happens next are thin on the ground. But the news of the sale has prompted concern within the UK industry about the future of both a number of beloved media outlets and the health of the media landscape that sustains the sector within its borders.
Rock, Paper, Shotgun Wedding
Of course, it wasn’t meant to end this way. Back in February 2018, ReedPop acquired Gamer Network for an undisclosed sum in what was pitched as a match made in heaven.
Lance Fensterman, then global head of ReedPop, and Rupert Loman, former head honcho over at Gamer Network, portrayed the deal as a meeting of minds and a fusion of two brands with strong events and communities.
On paper, this made sense. For ReedPop, the acquisition of Gamer Network gave it a foothold in the European consumer games event scene via EGX and provided it with direct access to media brands that reached tens of millions of players every month for the first time.
And for Gamer Network, ReedPop gave it a route into the US and the wider world through its enormous events - potentially growing the reach of its leading consumer and trade media brands both at home and abroad.
In short, it looked like a sensible combined media and events play that could have turned the joint business into a global games beast. But as we’ve seen this week, things have not worked out as either party would have hoped for.
Gamer Notwork
At the moment, it is hard to know what precisely prompted the move to sell. ReedPop’s statement on the matter was a classic example of a release that says just enough about the issue at hand and nothing more (something I begrudgingly respect from my time on the crisis comms frontline).
Despite this, I would cautiously advance that there are three likely reasons why it is seeking to sell Gamer Network now.
First, we know from Games Industry Biz’s piece announcing the intended sale that the pandemic damaged the combined company’s events business in a way that has pretty much hamstrung it from the outset.
I’ve previously discussed the mixed impact of the ‘rona on games companies, with short term gains leading to longer term problems. But for events businesses, Covid-19 was an unmitigated disaster with the pandemic wiping £57bn of value and 126,000 jobs from UK events companies alone.
ReedPop and Gamer Network suffered accordingly. In the UK, the hit to events temporarily damaged the core EGX event, led to the scuttling of expansion plans for a second EGX event in Birmingham and saw EGX Rezzed, the indie spin-off, shuttered.
And in the US, ReedPop’s failed attempt to reboot ailing US trade show E3 in partnership with the Entertainment Software Association in 2023 - something that it could only pursue as a result of E3’s own pandemic troubles - came as an additional unwelcome blow to an events business staggering back onto its feet.
Second, VGIM sources have suggested that the challenges with the event business were exacerbated by commercial difficulties on the UK media side.
Games media has long been a tricky business to monetise but it has become even more challenging in the past half-decade.
Declining web advertising revenues, the difficulties of riding ever-changing search engine algorithms, the requirement to pump out ever greater volumes of coverage to feed the beast and the adjacent evolution of the social media powered influencer economy - which arguably much more effectively connects brands to consumers where they actually are - has made the traditional economics of B2C games journalism a difficult grind.
While efforts have been made to increase revenue on the media side of Gamer Network to account for the tough landscape, such as introducing subscriptions on sites like Rock, Paper, Shotgun, those moves have reportedly been quietly helpful rather than transformative to its prospects. This left a stretched events business underwriting a series of games news sites at a time it really didn’t want to be.
Finally, and related to the point above, it’s possible to infer that pressures from ReedPop’s wider corporate structure likely created the conditions through which a severance of the events and media parts of the business could take place.
ReedPop is not a standalone business. Instead, it is a part of an exhibition company called RX Global which is in turn one part of data giant RELX Group.
While exhibitions and events are one of four pillars of RELX’s business, RX is both a) the smallest segment of the $58bn market cap business (accounting for roughly 13-15% of the company’s revenue each year) and b) fulfils a specific role to build networks and gather data for RELX’s three main business pillars: risk mitigation, legal compliance and science and health research (very video gamesy, I know).
This structure matters because RELX announced three strategic objectives for RX in February 2023 in its annual review that suggested the exhibitions part of the company needed to be more focused on the core goals of its parent business.
The first objective was the somewhat unthreatening commitment to create more digital events and initiatives. But the two other targets RELX set for RX sounded outright ominous: delivering ‘operational efficiency’ across its events and embarking on a process of ‘portfolio optimisation’ to ensure it delivered value.
With ReedPop already described as a ‘boutique’ part of the business (corporate speak for “we have it, it makes money and we like it but it’s not the thing we do”), it’s reasonable to assume that Gamer Network’s games media sites looked a little out of place in a business needing data for *checks RELX’s list of businesses* legal research tools, aviation analytics services and a scientific publishing platform.
And while it is unlikely that there was a diktat from on high that “VG 24/7 must go!”, it likely contributed to a corporate environment where ReedPop felt it could - and maybe should - send Gamer Network off to market.
Everything must go?
So, what’s next for Gamer Network? First and foremost, a sale will almost certainly happen - despite the use of conditional language in the public release.
While ReedPop says it is ‘investigating’ a sale, putting out a statement and issuing it through Gamer Network sites suggests it is actively flushing out a buyer for the business as quickly as possible. This sense is deepened by its public commitment to swallow up EGX into Reedpop’s core events business, creating what we in serious commercial circles call a ‘no backsies’ situation.
Second, there is reportedly a strong preference for a ‘one and done’ sale. While there has been some idle speculation that prestige brands like Games Industry Biz or Eurogamer could get picked off separately, it is more likely that interested parties will be encouraged to take the whole portfolio at once - with some parts thrown in at a knockdown price - on the proviso that they can restructure, sell or cast off the bits they don’t want later.
Third and finally, it is hard to see the sale of Gamer Network leading to anything other than disruption to the games media landscape - particularly in the UK.
Games Industry Biz is arguably the biggest video games trade news outlet in the world, extending its influence beyond the UK and running a range of events throughout the year to support the business community. The company’s breadth of consumer news sites provide multiple routes to market for games developers and significant spaces for games communities to congregate. And the support Gamer Network provides to companies it has shareholdings in, such as Digital Foundry and Outside Xbox, has provided welcome depth to the landscape.
The sale of the media portfolio means that restructuring and consolidation of its news sites is almost inevitable. The possible loss, or diminishing, of a range of video games media outlets and the fantastic writers who make them tick will not help an industry that is already struggling to find enough room to tell the stories of its games, studios and people.
And while there are great sites outside of the Network’s portfolio in the UK and interesting new entrants to the space showing the value of fresh thinking (e.g. the Gamer Network aligned news site VGC, Radio Times, TechRadar Gaming), there are few people around who look at the sale of Gamer Network with anything other than trepidation and concern for what it means for the plurality of the UK games media landscape.
So for now, we wait - as most of Gamer Network’s staff are doing - for news of a buyer.
But we need to, as an industry, start a bigger conversation about the health of our games media and how we can better support both its survival and evolution in the years to come.
News in brief
Spillover and out: Research from Ukie and FTI Consulting shows that video games technology added £1.3bn to the UK economy in fields such as healthcare and film & TV production in 2021. Come for some insightful research into the effect of games technology beyond the industry; stay to ponder what kind of deal took place to explain why a UK report has a whole section about the impact of game tech on the Nordics.
AI, AI, Captain: Dr Tommy Thompson has doubled down on his call for greater support for video games developers to navigate the challenges of using AI within their games businesses. You can read his rabble rousing/perfectly sensible and nuanced thoughts on self-regulation on his Substack.
This Bytes-Dance: Chinese tech giant ByteDance is joining the grand games industry firing squad, restructuring its business to completely exit the industry. Marvel Snap (which is published by the soon to be shuttered ByteDance business Nuverse) will apparently be unaffected by the move, according to its developer Second Dinner.
EU play too: The Council of Europe has approved a range of conclusions on enhancing the cultural and creative dimension of the European video games sector, including suggesting that the Commission should consider developing a European games strategy. If only there was someone suggesting that the UK needs a games strategy too…
Like and Subscribe: New research from the Entertainment Software Association has found that kids in the USA are both more likely to ask for video games this Christmas than any other present and that they’re most keen to get in-game subscriptions or items ahead of boxed releases. Given the current climate, Father Christmas’s physical goods workshop is probably bracing for lay-offs.
Jobs
Microsoft is looking for a Strategic Partner Manager for China at its base in Redmond…Sumo Digital is recruiting a Lead Community Manager for its Secret Mode publishing division…Ukie is adding a Communications Manager to their team...Double Eleven has a call out for a Producer…and Rockstar Games is seeking a Production Coordinator for Motion Capture…
Events and conferences
The Game Awards, Los Angeles - 7th December
Pocket Gamer Connects (20% off), London - 22nd - 23rd January 2024
Game Developers Conference, San Francisco - 18th - 22nd March 2024
London Games Festival, London - 9th - 25th April 2024
Games of the week
Rollerdrome: Roller-skating pew-pew game from excellent 15th birthday party hosts Roll7 cartwheels onto Game Pass.
Batman Arkham Trilogy: Rocksteady’s Batman trilogy goes portable on Switch, with added R-Patz approved The Batman suit.
Hitman: Blood Money: Enjoy some top quality murdering on iOS and Android in time for Christmas (there’s even a level where you can slay while dressed as Santa!)
Before you go…
UK comedy show Taskmaster is coming to VR early next year, allowing players to compete a series of tasks under the watchful eye of imposing overlord Greg Davies and loveable companion Little Alex Horne.
Expect it to be more fun than my attempt to watch a recording of the show at Pinewood Studios on Monday this week, which ended with me and a friend being turned away five minutes before it started because they’d handed out too many tickets in advance.
Grumbles…
Video Games Industry Memo is written by George Osborn, a video games industry expert who was allegedly forged in the fires of Mount Doom in an effort to defeat the realms of men.
Give him tips about forthcoming available job roles, events and games - or ask if he’s free to work with you in 2024 (spoiler alert: he currently is) - by dropping him an email here.