Just six weeks ago, Draw Something was the hottest mobile game in the world, but today its popularity has collapsed and Zynga may be left holding the bag.
Online game company OMGPOP launched Draw Something on February 6 of this year and watched it soar to 35 million downloads in just seven weeks. Not since the runaway sensation Angry Birds, had a game became the favorite pastime of iPhone addicts so quickly. That's when Zynga, the mobile game company that's intimately linked with Facebook, pounced. They quickly snatched up OMGPOP and its 40 or so employees for $200 million, rescuing a struggling company that had burned through $17 million in funding in six years and was on the verge of bankruptcy before stumbling upon the Pictionary clone that made everyone rich.
It was a great story ... for OMGPOP. For Zynga, it's starting to look like an expensive blunder. The company's earnings report last week appeared to be decent enough, showing strong revenue numbers that beat expectations. So why has Zynga's stock price declined by almost 50 percent since the beginning of March? Why has the acquisition of such a red-hot property not made investors happy? Because the hottest game in town, isn't so hot anymore.