TOKYO — DeNA, a Japanese social game company, said on Tuesday that it would acquire Ngmoco, a Silicon Valley iPhone game developer, for $400 million — one of the largest deals involving an iPhone software company and another sign that Apple’s products are fast becoming the hottest mobile game devices on the market.
The acquisition is also the latest in an overseas spending spree by DeNA, which is little known outside of Japan but aims to be a global rival to the big names in social networking and games, including Facebook and Zynga, which makes the FarmVille games.
“The big tide in social gaming is coming, right now,” Tomoko Namba, the founder and chief executive of DeNA, said in an interview. “We’d like to capture it and quickly become the world’s No. 1 mobile gaming platform.”
“We’re only active in the Japanese market, and we haven’t figured out how to cover the Western market,” she said. “We want to enable developers to go cross-device and to go cross-border. And we need this to happen quickly, in about the next one or two years.”
Ngmoco was founded two years ago by Neil Young, a longtime game executive who left his post at Electronic Arts to form the company. Not long after, it received financing from the venture capital firm Kleiner Perkins Caufield & Byers.
The company’s flagship game, Rolando, released in 2008, challenges players to navigate a smiling round character through a colorful animated landscape.
DeNA, which runs the wildly popular Mobage Town mobile social game platform in Japan, began an aggressive global expansion in the last year, acquiring game developers based in the United States to add more content to its platform and translate its success overseas.
The company is racing to get a piece of the rapidly expanding market for online social games, or games played on social networks, like FarmVille on the Facebook site. This year, the research company Screen Digest forecast that the social games market would grow to $1.5 billion in 2014, from about $640 million in 2009.
This year, Google invested in the social game company Zynga, while Disney bought Tapulous, an iPhone application developer best known for its Tap Tap Revenge games.
Mobage Town, a platform of social games, chat rooms and virtual characters that has 20.5 million users, has been a hit with the mobile-savvy young generation in Japan, bucking a general decline in the Japanese console game industry in recent years. The service offers games free but requires users to sign up and create online avatars, or virtual characters, so they can interact with one another. DeNA then sells virtual clothes and other game accessories for the avatars.
DeNA booked sales last year of about 48 billion yen, or $575 million. Ms. Namba said it was on track to double that figure this fiscal year to more than $1 billion.
DeNA is betting that social games will increasingly be played on mobile platforms and that the company’s focus on mobile technology will broaden its user base. In May, DeNA introduced MiniNation, a global version of its Mobage social game platform for the iPhone and iPod Touch, which lets users play simple games, befriend other users, post messages and create communities.
DeNA plans to integrate its Mobage software with Ngmoco’s own social networking platform, called Plus+, which runs on Apple devices and smartphones that use Google’s Android system.
The new global platform will allow developers to aim for both Apple and Android users and gain access to Western and Japanese customers, said Mr. Young of Ngmoco — short for next generation mobile company. Ngmoco’s games have been downloaded more than 60 million times.
“Whether you’re a developer in Japan working on a Mobage, or you’re a developer in the West making apps, you’ll be able to work with us, and your games will be able to move across borders and move across devices,” Mr. Young said.
Mobile devices will be crucial to the growth of social games, because the social relationships encourage users to log in throughout the day, whenever they have time, said Hirokazu Hamamura, president of Enterbrain, a Tokyo-based game research company.
“But the competition will be intense,” he said. “If your games can’t attract a mass following, they’re not social, and there’s no point.”
DeNA follows a trend of Japanese companies that have capitalized on the strong yen, which is at 15-year highs against the dollar, with acquisitions abroad.
Rakuten, Japan’s biggest e-commerce company, acquired the American online retailer Buy.com in May for $250 million and paid a similar amount for a European Web shopping site, PriceMinister, in June.
In the last month, DeNA said that it would invest in Astro Ape and Gameview, game developers based in the United States. Last year DeNA bought IceBreaker, an American game studio, and acquired a 20 percent stake in Aurora Feint, a developer of mobile game platforms.
But Ngmoco, which is based in San Francisco, is DeNA’s most prominent acquisition. It has grown rapidly, partly by using venture capital to acquire the game developers Miraphonic in 2009, and Freeverse and Stumptown Game Machine this year.
Its acquisition was approved Tuesday by DeNA’s board and will close within weeks, DeNA said. Last week, TechCrunch first reported that DeNA was considering acquiring Ngmoco.
TOKYO — DeNA, a Japanese social game company, said on Tuesday that it would acquire Ngmoco, a Silicon Valley iPhone game developer, for $400 million — one of the largest deals involving an iPhone software company and another sign that Apple’s products are fast becoming the hottest mobile game devices on the market.The acquisition is also the latest in an overseas spending spree by DeNA, which is little known outside of Japan but aims to be a global rival to the big names in social networking and games, including Facebook and Zynga, which makes the FarmVille games.
“The big tide in social gaming is coming, right now,” Tomoko Namba, the founder and chief executive of DeNA, said in an interview. “We’d like to capture it and quickly become the world’s No. 1 mobile gaming platform.”
“We’re only active in the Japanese market, and we haven’t figured out how to cover the Western market,” she said. “We want to enable developers to go cross-device and to go cross-border. And we need this to happen quickly, in about the next one or two years.”
Ngmoco was founded two years ago by Neil Young, a longtime game executive who left his post at Electronic Arts to form the company. Not long after, it received financing from the venture capital firm Kleiner Perkins Caufield & Byers.
The company’s flagship game, Rolando, released in 2008, challenges players to navigate a smiling round character through a colorful animated landscape.
DeNA, which runs the wildly popular Mobage Town mobile social game platform in Japan, began an aggressive global expansion in the last year, acquiring game developers based in the United States to add more content to its platform and translate its success overseas.
The company is racing to get a piece of the rapidly expanding market for online social games, or games played on social networks, like FarmVille on the Facebook site. This year, the research company Screen Digest forecast that the social games market would grow to $1.5 billion in 2014, from about $640 million in 2009.
This year, Google invested in the social game company Zynga, while Disney bought Tapulous, an iPhone application developer best known for its Tap Tap Revenge games.
Mobage Town, a platform of social games, chat rooms and virtual characters that has 20.5 million users, has been a hit with the mobile-savvy young generation in Japan, bucking a general decline in the Japanese console game industry in recent years. The service offers games free but requires users to sign up and create online avatars, or virtual characters, so they can interact with one another. DeNA then sells virtual clothes and other game accessories for the avatars.
DeNA booked sales last year of about 48 billion yen, or $575 million. Ms. Namba said it was on track to double that figure this fiscal year to more than $1 billion.
DeNA is betting that social games will increasingly be played on mobile platforms and that the company’s focus on mobile technology will broaden its user base. In May, DeNA introduced MiniNation, a global version of its Mobage social game platform for the iPhone and iPod Touch, which lets users play simple games, befriend other users, post messages and create communities.
DeNA plans to integrate its Mobage software with Ngmoco’s own social networking platform, called Plus+, which runs on Apple devices and smartphones that use Google’s Android system.
The new global platform will allow developers to aim for both Apple and Android users and gain access to Western and Japanese customers, said Mr. Young of Ngmoco — short for next generation mobile company. Ngmoco’s games have been downloaded more than 60 million times.
“Whether you’re a developer in Japan working on a Mobage, or you’re a developer in the West making apps, you’ll be able to work with us, and your games will be able to move across borders and move across devices,” Mr. Young said.
Mobile devices will be crucial to the growth of social games, because the social relationships encourage users to log in throughout the day, whenever they have time, said Hirokazu Hamamura, president of Enterbrain, a Tokyo-based game research company.
“But the competition will be intense,” he said. “If your games can’t attract a mass following, they’re not social, and there’s no point.”
DeNA follows a trend of Japanese companies that have capitalized on the strong yen, which is at 15-year highs against the dollar, with acquisitions abroad.
Rakuten, Japan’s biggest e-commerce company, acquired the American online retailer Buy.com in May for $250 million and paid a similar amount for a European Web shopping site, PriceMinister, in June.
In the last month, DeNA said that it would invest in Astro Ape and Gameview, game developers based in the United States. Last year DeNA bought IceBreaker, an American game studio, and acquired a 20 percent stake in Aurora Feint, a developer of mobile game platforms.
But Ngmoco, which is based in San Francisco, is DeNA’s most prominent acquisition. It has grown rapidly, partly by using venture capital to acquire the game developers Miraphonic in 2009, and Freeverse and Stumptown Game Machine this year.
Its acquisition was approved Tuesday by DeNA’s board and will close within weeks, DeNA said. Last week, TechCrunch first reported that DeNA was considering acquiring Ngmoco.
The acquisition is also the latest in an overseas spending spree by DeNA, which is little known outside of Japan but aims to be a global rival to the big names in social networking and games, including Facebook and Zynga, which makes the FarmVille games.
“The big tide in social gaming is coming, right now,” Tomoko Namba, the founder and chief executive of DeNA, said in an interview. “We’d like to capture it and quickly become the world’s No. 1 mobile gaming platform.”
“We’re only active in the Japanese market, and we haven’t figured out how to cover the Western market,” she said. “We want to enable developers to go cross-device and to go cross-border. And we need this to happen quickly, in about the next one or two years.”
Ngmoco was founded two years ago by Neil Young, a longtime game executive who left his post at Electronic Arts to form the company. Not long after, it received financing from the venture capital firm Kleiner Perkins Caufield & Byers.
The company’s flagship game, Rolando, released in 2008, challenges players to navigate a smiling round character through a colorful animated landscape.
DeNA, which runs the wildly popular Mobage Town mobile social game platform in Japan, began an aggressive global expansion in the last year, acquiring game developers based in the United States to add more content to its platform and translate its success overseas.
The company is racing to get a piece of the rapidly expanding market for online social games, or games played on social networks, like FarmVille on the Facebook site. This year, the research company Screen Digest forecast that the social games market would grow to $1.5 billion in 2014, from about $640 million in 2009.
This year, Google invested in the social game company Zynga, while Disney bought Tapulous, an iPhone application developer best known for its Tap Tap Revenge games.
Mobage Town, a platform of social games, chat rooms and virtual characters that has 20.5 million users, has been a hit with the mobile-savvy young generation in Japan, bucking a general decline in the Japanese console game industry in recent years. The service offers games free but requires users to sign up and create online avatars, or virtual characters, so they can interact with one another. DeNA then sells virtual clothes and other game accessories for the avatars.
DeNA booked sales last year of about 48 billion yen, or $575 million. Ms. Namba said it was on track to double that figure this fiscal year to more than $1 billion.
DeNA is betting that social games will increasingly be played on mobile platforms and that the company’s focus on mobile technology will broaden its user base. In May, DeNA introduced MiniNation, a global version of its Mobage social game platform for the iPhone and iPod Touch, which lets users play simple games, befriend other users, post messages and create communities.
DeNA plans to integrate its Mobage software with Ngmoco’s own social networking platform, called Plus+, which runs on Apple devices and smartphones that use Google’s Android system.
The new global platform will allow developers to aim for both Apple and Android users and gain access to Western and Japanese customers, said Mr. Young of Ngmoco — short for next generation mobile company. Ngmoco’s games have been downloaded more than 60 million times.
“Whether you’re a developer in Japan working on a Mobage, or you’re a developer in the West making apps, you’ll be able to work with us, and your games will be able to move across borders and move across devices,” Mr. Young said.
Mobile devices will be crucial to the growth of social games, because the social relationships encourage users to log in throughout the day, whenever they have time, said Hirokazu Hamamura, president of Enterbrain, a Tokyo-based game research company.
“But the competition will be intense,” he said. “If your games can’t attract a mass following, they’re not social, and there’s no point.”
DeNA follows a trend of Japanese companies that have capitalized on the strong yen, which is at 15-year highs against the dollar, with acquisitions abroad.
Rakuten, Japan’s biggest e-commerce company, acquired the American online retailer Buy.com in May for $250 million and paid a similar amount for a European Web shopping site, PriceMinister, in June.
In the last month, DeNA said that it would invest in Astro Ape and Gameview, game developers based in the United States. Last year DeNA bought IceBreaker, an American game studio, and acquired a 20 percent stake in Aurora Feint, a developer of mobile game platforms.
But Ngmoco, which is based in San Francisco, is DeNA’s most prominent acquisition. It has grown rapidly, partly by using venture capital to acquire the game developers Miraphonic in 2009, and Freeverse and Stumptown Game Machine this year.
Its acquisition was approved Tuesday by DeNA’s board and will close within weeks, DeNA said. Last week, TechCrunch first reported that DeNA was considering acquiring Ngmoco.
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