Club Penguin - A Very Successful Habbo Hotel Look Alike?posted by MR WAVETHEORY at 2/22/2007 12:00:00 AM
These are interesting venture plays because these casual game companies push the envelope for larger console game developers like EA in the opposite direction. Sites like Club Penguin are simple to navigate and have neat but not all that sophisticated graphics. Imagine that in an EA game! In that sense, these companies are expanding the market for games.
Are there exits for companies like Club Penguin? Probably. Maybe Club Penguin will turn out like Neopets and get acquired for a princely sum ... like $160 million. Are there pitfalls to acquiring these companies? Absolutely. My guess is Neopets peaked in 2005 which is when they got bought by Viacom. The traffic on Neopets has been flat to declining based on a quick eyeball of some traffic charts, so the management team was smart to sell.
Games are a fad, fashion, and hit driven business. No doubt about it! All this just means fortunes can be made and lost much faster!