Sony Invests $250 Million In Epic Games

In a joint press release, Sony Corporation and Epic Games announced that Sony has made a strategic investment of $250 million to acquire a minority interest in Epic through a wholly-owned subsidiary.

Sony President and CEO Kenichiro Yoshida had this to say about the deal: “Epic’s powerful technology in areas such as graphics places them at the forefront of game engine development with Unreal Engine and other innovations. There’s no better example of this than the revolutionary entertainment experience, Fortnite. Through our investment, we will explore opportunities for further collaboration with Epic to delight and bring value to consumers and the industry at large, not only in games but also across the rapidly evolving digital entertainment landscape.”

As for Epic CEO Tim Sweeney, his statement appears equally enthusiastic. “Sony and Epic have both built businesses at the intersection of creativity and technology, and we share a vision of real-time 3D social experiences leading to a convergence of gaming, film, and music. Together we strive to build an even more open and accessible digital ecosystem for all consumers and content creators alike,” he said.

While the dollar amount of the investment sounds substantial, it’s not quite as earth-shattering as one might believe. Tencent invested more back in 2012 ($330 million USD), but that was when the company’s valuation was significantly smaller.  That investment translated to a 40% stake in Epic. By this point, Sony’s investment translates only to a 1.4% stake, putting Epic’s valuation just short of $18 billion. For comparison, Take-Two Interactive is currently valued at a little over $17 billion USD.

Rumors are rampant at the moment regarding this particular deal. While more ridiculous suggestions like Sony forcing all developers to use Unreal Engine 5 for all PlayStation 5 titles can safely be dismissed as absurdity, one wonders precisely what Sony’s getting out of the deal. The mention of Fortnite is potentially significant given Sony’s music division (which would allow for more performers to stage virtual concerts) as is the fact that Epic was the first company to officially break through Sony’s walled garden to allow cross-play with other consoles and PCs. It will be interesting to see where this partnership goes once the next console generation launches.

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