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Unity, one gaming development platform to unite them all, up for sale

A presentation pitching Unity has been circulating around the games industry, sources say. The potential buyer gets popular software that powers games large and small.

Developers check out 3D modeling software from Unity, a platform for creating games and interactive 3D training simulations and medical, architectural, and modeling visualizations, on the Web, iOS, Android, and consoles. James Martin/CNET

When World of Warcraft maker Blizzard set out to make a card game that worked on computers and mobile devices, it used tools made by Unity to help bring it to life.

Blizzard created Hearthstone: Heroes of Warcraft, which has become one of its most popular titles. That success is due to how easy it is to use on both PCs and tablets, a big accomplishment for Blizzard since Hearthstone was its first-ever game for mobile devices. Much of the credit goes to Unity's tools, which make it easier to create games that work across devices, said Jason Chayes, who headed up production for Hearthstone.

"It was a first for Blizzard to bring a game to mobile devices, and we wanted it to be a great experience," he said. Unity made that possible.

Chayes and his team aren't the only ones tapping into Unity's game engine to save time and effort. More than 3 million people have registered to use Unity's tools, which were first released in 2005, the San Francisco-based company says.

More importantly, nearly half of all mobile game developers today use Unity.

Now the company is gearing up for a potential sale, having shared presentations with possible acquirers including Google, according to people familiar with the matter. It's also had serious talks with at least one would-be buyer in recent months, they say.

Is this good or bad news for Unity and game developers? That's an open question. A sale is a risky choice for software tools makers. While acquisitions can help a company grow faster, often by giving it access to much-needed capital to fund development or a large sales staff to pitch customers, a buyout can also hurt its prospects. Large parent companies can reduce funding in development or restrict access to the technology, both of which have happened to other game making tools.

If Unity picks an indifferent sponsor, game developers won't have many alternatives to which they can turn to get the easy, cross-device development they enjoy today. One choice is Unreal Engine, software developed by Epic Games that offers functionality similar to Unity. But Unreal Engine isn't as popular among mobile app developers, in part because it was slower to support Apple's mobile devices than Unity was.

Whether Unity is actively trying to sell itself isn't clear. Various people tell CNET News that either the company has been courting potential deals or responding to interest from its partners and other companies.

It's also unclear how much Unity is worth, with a recent VentureBeat article pegging an asking price as high as $2 billion.

Unity declined to comment.

A decade in the making

Unity's big break came in 2008, four years after the company was founded by a team in Denmark including David Helgason and Joachim Ante, now the company's CEO and CTO. That March, Apple introduced its App Store, a software market for apps designed to run on the iPhone. The promise that developers could create all manner of programs and sell them through Apple's digital marketplace was enticing. But there was a hitch: Apple's coding tools used a version of the language built for its own Macintosh computers.

Without a Mac, or knowledge of Apple's programming tools, mobile app developers were stuck.

David Helgason, Unity's CEO, in a promotional video in 2013 Unity

Helgason worked with his team to support the iPhone, enabling developers to create apps for mobile devices using the same tools and coding languages that had been designed for desktop programs.

Today, Unity's software works on nearly all mobile devices, including those powered by Apple's iOS mobile operating system, Google's Android and Microsoft's Windows Phone. Unity can also produce programs for video game consoles such as Microsoft's Xbox One, Sony's PlayStation 4 and Nintendo's Wii U. Developers can even use its software to make games for BlackBerry's mobile devices.

And in September, Unity announced a deal with Facebook's Oculus unit, maker of virtual-reality headsets. As part of the pact, specialized software for Oculus's headsets will be integrated into Unity's tools, making the already popular gaming engine one of the standards used to create virtual-reality software.

That could all change with an acquisition. In the past, buyouts of development tools have had mixed results. Industry titan Electronic Arts acquired RenderWare, then a popular game development technology, when it purchased Criterion Games in 2004. But within three years, EA downplayed the software's value, claiming it didn't deliver the performance needed to make top-tier titles.

EA was also at one point a potential suitor for Unity, though not recently. EA has since instead focused on other proprietary engines that now power its top games.

Other software tools have flourished after being purchased. In the year since Facebook purchased Parse, the company has doubled its employees as the number of apps built using its tools increased more than sixfold to 400,000. It's also branching into new initiatives beyond its mobile app development tools. In April, Parse partnered with companies including Dropbox on a new code technology called App Links, which helps mobile programs better talk to one another.

Where to go from here

Unity is part of a growing trend in the technology industry, aimed at making it easier to create code. The company doesn't just let game developers make programs easier and faster. It also offers developers a way to produce apps for many different platforms without a lot of extra hassle. That's key since many mobile game makers are made up of small companies with just a handful of employees and limited resources.

However, there's some debate about even using outside tools to create cutting-edge games.

Historically, game companies created their own development tools in an effort to produce titles with richer details and higher performance. This grow-your-own approach helped make Bungie's Halo: Combat Evolved a groundbreaking game when it was released for the Xbox in 2001. Proprietary technology has also helped sell games at EA, whose Frostbite engine helps create photorealistic cities for its Battlefield franchise. Other companies, from Assassin's Creed maker Ubisoft to startups like Super Evil Megacorp, also created their own development tools with an eye toward offering unique-looking games with richer graphics and faster animations.

Not all companies feel they need to do everything themselves.

Kabam, a San Francisco-based video game maker known for its Kingdoms of Camelot strategy game, built its production tools around Unity to simplify development. Using Unity has saved Kabam time and money that would have been spent building intricate game-making software, says Aaron Loeb, senior vice president of Kabam's North American Studios.

Unity also made hiring new employees easier; students and aspiring game makers are learning to make games using those tools, Loeb said. That means new employees get up to speed quickly on Kabam's systems. By comparison, unique game development tools take time and resources to create and teach. "What Unity has done is allow our team to focus time and money on the game," he said.

One example is Kabam's latest title, Marvel Contest of Champions. The game pits popular characters like Captain America against Spider-Man in a sort of street-fight brought to life with visual details and effects that look like they could be designed for a video game console. Instead, it's being released for mobile devices in the coming weeks.

"It's a really gorgeous game," Loeb said. "It shows how impressive games can look using Unity."

Game industry executives say it's probably too soon for developers to worry about Unity's future. But if a sale happens, it will spur debate about where Unity is headed and whether it can remain the most popular engine for making mobile games.