May 8, 2008 3:31 PM PDT

Report: EA buys Shawn Fanning's Rupture for $30 million

Posted by Daniel Terdiman

It seems that the founder of Napster--no, not Seth Green--may have finally cashed in big time on one of his creations.

According to TechCrunch, Napster founder Shawn Fanning has sold his gaming social-media start-up, Rupture, to Electronic Arts for $30 million.

TechCrunch's Erick Schonfeld reported Thursday afternoon that as part of the deal--which EA has not yet announced, "but is expected to do so soon," Fanning and Rupture co-founder Jon Baudanza will become EA employees.

For Fanning, this represents the big-time payday he's clearly been seeking for years. He never made much off of Napster, and his last start-up, Snocap, was purchased by Imeem for what is assumed to be a negligible sum.

As for why--if the report is true--EA is buying Rupture, which was working on a social-networking system for players of World of Warcraft, Schonfeld writes that EA "bought the company for its technology. Presumably, creating social networks around massively multiplayer video games is a key component of its online strategy."

That certainly makes sense, and especially so given the success of connected systems like Microsoft's Xbox Live.

It is interesting that EA seems to have chosen Fanning's company when another gamers-oriented social-media service, Xfire founder Dennis Fong's Raptr, has also been making waves. Perhaps Fong wanted too much money for his company.

For EA, though, creating its own hit MMO is mostly a dream. Though it published Ultima Online, one of the first important graphical MMOs, through its Origin Systems subsidiary, it hasn't really come out with anything that followed on that success.

And as companies like Sony Online Entertainment, NCSoft, and, most notably, Blizzard Entertainment have become leaders in the MMO industry, EA has for the most part sat idly by. One would have to assume that someday, it will try to get its own version of WoW off the ground. And technology like that of Rupture could be a big component of that.

On June 10, Geek Gestalt hits the highways for Road Trip 2008. I'll start in Orlando, Fla., and visit many of the South's most interesting destinations. Stay tuned, and be sure to keep up with what I'm doing on Twitter.