It's no secret that Zynga is in trouble. The former giant of social gaming is now on the defensive as it lays off employees and closes studios around the world. It has to find a hit, preferably in mobile, to get back into the game. Before any of that happens, though, the social games maker might find itself with a new owner.
It's being reported that Yahoo is currently in talks to buy Zynga, and the rumors have done nothing but good for the company. Zynga's shares were up by 10 percent on Monday at the news of a potential buyout. The company's share price has since receded four percent. As for Yahoo, buying Zynga would help the company on its way to refocusing its efforts on mobile.
That being said, some analysts are rightly skeptical of any such purchase. Macquarie Securities analyst Ben Schachter says that a Zynga buyout probably won't happen as he doesn't "believe that [CEO] Mark Pincus wants to sell at this time." He also says that Yahoo wouldn't be interested in buying Zynga as "its strategy is to partner with varied content providers."
That last statement is rather interesting in this particular context. Yahoo may not be buying Zynga, but it makes sense for the two to collaborate on a future project together. Yahoo has the audience for Zynga's games, and Zynga could use another outlet to gain more players outside of Facebook and its own Zynga.com games portal.
Of course, all of this comes down to Zynga playing its cards right. 2012 was marked by a number of bad business decisions, but the social games maker seems to know what it's doing this year. A partnership with Yahoo or any other major Internet brand could be incredibly lucrative for Zynga.[Wall Street Journal via GamesIndustry International]