Chinese ISP Tencent has completed a deal to purchase Clash of Clans developer Supercell for the princely sum of $8 billion, making a big commitment to the future of mobile gaming.
In 2010, two Finnish game designers poured the better part of their savings into set-up costs for a new studio, Supercell. The pair moved into a small office in the city of Espoo and set about making engaging mobile games with a team of likeminded individuals — six years later, their company has sold for $8 billion.
The secret to Supercell’s success? A project called Clash of Clans, a multiplayer strategy title that’s specifically designed to be as addictive as possible. Within three months of its release, the game had become the most profitable app in the United States.
Supercell reported earnings of $779.1 million last year alone, according to a report from VG247. As well as the enduring popularity of Clash of Clans, the developer has released several other games that are also very successful; Hay Day, Boom Beach and this year’s Clash Royale.
With such an enormous amount of money being brought in by the studio’s games, it’s perhaps unsurprising that Supercell would be a prime target for acquisition. However, the amount of money that Chinese ISP Tencent paid for the developer is still a very impressive sum.
To put the sale price in context, Microsoft only paid $2,5 billion when it purchased development studio Mojang and its star IP Minecraft in 2014. When Disney bought Lucasfilm in 2012 — a transaction that secured the Star Wars and Indiana Jones franchises — the deal was sealed for $4 billion.
Both of those exchanges gave the buyers access to products and IP that have since earned millions of dollars for their new owners. The thought process behind the Supercell deal seems to be that games like Clash of Clans have the potential to deliver similar results for the foreseeable future.
However, this makes the assumption that either the current crop of titles will maintain its popularity, or Supercell will be able to win fans over with new experiences once these games have run their course. The studio isn’t a one-trick-point, as its games other than Clash of Clans have found success — but it’s perhaps worth noting that their biggest releases have largely been confined to the strategy genre.
It remains to be seen whether or not Tencent will look back on this $8 billion acquisition — the company’s biggest ever — as a smart business move. However, it seems fairly certain that those Clash of Clans TV adverts aren’t going to get any less frequent.