Social gaming giant Zynga now worth more than EA

Additional reporting by GamesRadar staff

According to Bloomberg, the stock value of social games producer Zynga has surpassed that of Electronic Arts, the second largest video game publisher in the world (behind Activision Blizzard.) The Farmville creators are now valued at $5.51 billion, compared to EA's $5.22. Both are less than half of Activision Blizzards $13.9 billion, which is itself small compared to Tencent Holdings of China's $43 billion.

The news is a nice feather in Zynga's cap, but industry followers should be careful not to assume this news indicates that that EA is failing in the marketplace. While the publisher has been hit hard and forced to reduce staff at several major studios,it isn't going anywhere anytime soon.

Above: YOU MUST PLAY IT ALL THE TIME

Irate hardcore gamers may see this newsas a threat to their hobby, and they aren't alone -Bloomberg reporter Ari Levycallsit "a sign of the ascendance of social-networking entertainment at the expense of traditional video games."

Levy continues, "[Electronic Arts] faces declining retail sales of gaming hardware and software. More consumers would rather play online and social-networking games, rather than heading to a store to buy a shrink-wrapped program. That’s forced Electronic Arts to cut jobs and seek acquisitions for growth. Its shares have dropped 6.3 percent since March 1. Zynga’s estimated value has more than doubled in that period."

We're not sure what statistics make the connection between Zynga's success and EA's decline - no data is cited in the article. Didn'ta stats teacher once tellus that correlation does not imply causation?

Our mothers' FarmVille obsessions don't seem to come at the expense of "traditional" games. The franchises we love aren't dying because of Facebook, the iPad, and Kinect. Fantastic indie game designers aren't slowing down, they're growing in ranks. Granted, we are totally unqualifiedas industry analysts, so y'know, maybe Bloomberg is right.

But it seems to us that the rise of social and mobile gaming could be good news for hardcore gamers.More social games means more interest in gaming, leading to more hardcore gamers in the future, leading to increasedmarket demand and more hardcore games. Everybody wins? We'll just have to watch and find out.

[Source:Bloomberg.com]

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