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Outcompeting a competitive market? Epic Games and LEGO announce metaverse collaboration:
“Can multiple metaverses survive, or will there be one metaverse to rule them all?” Stuart Smith, corporate
transactions and intellectual property lawyer and Partner at Simkins
4 | MCV/DEVELOP June 2022
ON 11 APRIL, Epic Games announced that it had raised a further $2 billion, bringing Epic’s post-investment value to $31.5 billion. Half of that investment comes from Sony, building on a previous $250 million investment in the Fortnite developer announced back in July 2020. The other half of this latest investment is provided by KIRKBI, the family-owned holding and investment company which owns the LEGO Group, with the announcement of this fundraising coming just days after Epic and the LEGO Group announced their “long- term partnership to shape the future of the metaverse”. More than just a good news story for Epic, the developing relationships between these businesses could shine a light on interesting trends in the games industry and the evolution of the metaverse. Firstly, however, this is unquestionably great news for Epic. When Sony previously invested in Epic, its $250 million investment gave it a 1.4% stake in Epic, valuing Epic at $17.76 billion. Following this latest investment, Epic’s value has increased by over 75% in under two years, demonstrating the impressive trajectory of Epic’s growth. Tim Sweeney, Epic’s CEO and Founder, stated that the investment would be used to “accelerate our work to build the metaverse and create spaces where players can have fun with friends, brands can build creative and immersive experiences and creators can build a community and thrive”, and it will be fascinating to see what Epic is able to achieve with this additional financial firepower at its disposal.
On the Sony side, this is an interesting example of what feels like an evolving approach to relationships between the biggest beasts of the gaming industry. There is, of course, more to the Sony Group than PlayStation, and Epic products like Unreal Engine have applications far beyond gaming, but according to Sony’s 2021 Corporate Report, its Game & Network Services business accounts for “roughly 25% of Sony’s total sales”. In other words, the home of PlayStation has just invested a further £1 billion in a developer whose most successful games regularly feature in the most played charts of PlayStation’s main rivals. The fact that major titles like Marvel’s
Spider-Man: Miles Morales, Gran Turismo 7 and Horizon: Forbidden West are either fully PlayStation exclusive or released on PlayStation significantly earlier than on PC shows that Sony obviously still sees a place for big budget platform exclusives, and seemingly more of a place than Microsoft does following its commitment to release first party titles on PC as well as Xbox. This development in the relationship with Epic, however, comes closely after Sony was particularly careful to assure gamers that Bungie games would continue to be multiformat after Bungie’s acquisition by Sony, suggesting that Sony is embracing a more open, collaborative approach to the games business. Microsoft has, of course, been moving in this direction for some time, particularly following its acquisition of Minecraft developer Mojang and its increasing focus on Game Pass across Xbox and PC.
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