Game controller merging with a corporate building to symbolize video game acquisition.

Level Up? How Gaming Acquisitions Impact Game Quality

Nico Varela in Tech & Innovation December 2025 • 4 min read.

"A deep dive into whether mergers and acquisitions in the console gaming industry lead to better or worse games."

The console gaming industry, a titan in the global entertainment arena, is no stranger to consolidation. In recent years, high-profile acquisitions, such as Microsoft's acquisition of Activision Blizzard and Zenimax, have sent ripples throughout the industry, sparking debates about the impact on consumers and competition. But what happens to the games themselves? Do mergers and acquisitions lead to a surge in quality, or do they spell a decline for the titles we love?

Acquisitions are complex events with potential upsides (access to more resources, talent, and technology) and downsides (disruptions in studio culture, shifts in creative vision). Understanding these dynamics is critical for gamers, industry professionals, and policymakers alike.

This article dives into new research investigating the effects of acquisitions on game quality within the console gaming sphere. By analyzing a comprehensive dataset of console games released over two decades, we'll explore whether these mergers and acquisitions ultimately lead to better or worse gaming experiences.

Do Acquisitions Really Improve Game Quality?

Game controller merging with a corporate building to symbolize video game acquisition.

To tackle this question, researchers often employ a method called a difference-in-difference (DiD) model. This approach compares the change in game review scores for studios that were acquired (the treatment group) against studios that remained independent (the control group). By comparing these two groups over time, the DiD model can help isolate the specific impact of acquisitions while accounting for other factors that might influence game quality, such as evolving technology and changing consumer preferences.

The study meticulously controlled for various factors, including game genre, release year, and platform. This ensures that any observed changes in review scores are more likely due to the acquisition itself, rather than simply a trend in a particular genre or platform.

Genre Fixed Effects: Different genres have inherent rating biases. This helps ensure fair comparisons.
Platform Fixed Effects: Quality expectations vary across platforms. This control accounts for those differences.
Release Year Fixed Effects: Industry-wide trends can influence production values and consumer tastes. This helps isolate the acquisition's true impact.

So, what did the research reveal? The study suggests a positive and statistically significant impact of acquisitions on game review ratings, at least when considering genre and release year. This indicates that, on average, acquired studios tend to release games that are reviewed more favorably than they would have if they had remained independent. It seems that access to additional resources, talent, or technology from the parent company may indeed translate to higher-quality games.

The Verdict: Level Up or Game Over?

The research suggests that acquisitions can indeed have a positive impact on game quality, providing acquired studios with the resources and support they need to create better games. However, the study also acknowledges potential limitations, including biases in the data and the challenges of finding a perfect control group. Future research could delve deeper into the specific factors that contribute to the success or failure of gaming acquisitions, providing even more valuable insights for industry stakeholders and gamers alike.

About this Article -

This article was crafted using a human-AI hybrid and collaborative approach. AI assisted our team with initial drafting, research insights, identifying key questions, and image generation. Our human editors guided topic selection, defined the angle, structured the content, ensured factual accuracy and relevance, refined the tone, and conducted thorough editing to deliver helpful, high-quality information.See our About page for more information.

This article is based on research published under:

DOI-LINK: https://doi.org/10.48550/arXiv.2406.02525,

Title: The Impact Of Acquisition On Product Quality In The Console Gaming Industry

Subject: econ.em

Authors: Shivam Somani

Published: 04-06-2024

Everything You Need To Know

What is the main topic being discussed within the context of console gaming?

The primary topic is the impact of mergers and acquisitions (M&A) within the console gaming industry on the quality of games. The focus is on whether acquisitions, like Microsoft's acquisition of Activision Blizzard and Zenimax, lead to better or worse gaming experiences for consumers. The analysis employs a Difference-in-Difference (DiD) model to explore these effects.

How is game quality measured within the context of acquisitions and the study?

Game quality is measured using game review scores. The study analyzed a comprehensive dataset of console games released over two decades. To determine the impact of acquisitions, the research compares the review scores of games released by acquired studios (the treatment group) against those of studios that remained independent (the control group). Factors like Genre Fixed Effects, Platform Fixed Effects, and Release Year Fixed Effects are considered to ensure accurate comparisons.

What methodology is used to assess the impact of acquisitions on game quality, and how does it work?

The research employs a Difference-in-Difference (DiD) model. This model compares the change in game review scores for studios that were acquired (the treatment group) against those that remained independent (the control group). By comparing these two groups over time, the DiD model helps isolate the specific impact of acquisitions while accounting for other influences on game quality like evolving technology, and changing consumer preferences.

Besides acquisitions, what other factors are considered to ensure the study accurately assesses game quality changes?

The study meticulously controls for various factors to isolate the impact of acquisitions. These factors include Genre Fixed Effects, Platform Fixed Effects, and Release Year Fixed Effects. Genre Fixed Effects accounts for inherent rating biases in different game genres. Platform Fixed Effects acknowledges that quality expectations vary across platforms. Release Year Fixed Effects considers industry-wide trends that influence production values and consumer tastes.

According to the research, what is the general impact of acquisitions on game quality, and what are some potential limitations?

The research suggests a positive and statistically significant impact of acquisitions on game review ratings, indicating that acquired studios tend to release games that are reviewed more favorably. This implies that access to additional resources, talent, or technology from the parent company may translate to higher-quality games. However, potential limitations include biases in the data and challenges in finding a perfect control group. Future research could explore specific factors that contribute to the success or failure of gaming acquisitions.