Red Octane's rags-to-riches story ends in acquisition [update 1]

Red Octane, publisher of the smash-hit Guitar Hero game was sitting in the ghetto of E3's Kentia Hall this time last year. Today, Activision announced that they'd be acquiring the company (and the Guitar Hero franchise along with it) in order to build an "early leadership position in music-based gaming." Cha-ching, hip swing.

We're predicting that more publishers go on an acquisition jag during this time of lean. The console transition is cruel to publishers and developers both, but we gather that some publishers are still sitting on sizable warchests that they mean to put to use by snapping up smaller companies who've shown promise (or who hold the rights to hot franchises).

Chances are, this also means that future iterations of Guitar Hero will launch on the Xbox 360 and PlayStation 3 (instead of the PlayStation only).

[Thanks, CheapyD]

[update 1: cleared up publisher/developer confusion in the first paragraph.]

This article was originally published on Joystiq.