NEW YORK (CNN/Money) - It's really no secret that a wave of consolidation is threatening to crash down on the gaming industry these days. The surprising thing is how many big names are being bandied about as potential takeover targets.

Consolidation is part of the natural cycle in gaming. As boom years approach, developers and publishers begin to pop up all over the place, each fervently working on big games for consoles and PCs. As the cycle reaches its peak, bigger publishers swallow up the smaller ones, adding more in-house talent to their roster and expanding their reach in the business.

Things are different this time around, though.

Among the names being bandied about as possible takeover candidates are Sega, Eidos (EIDSY: Research, Estimates), Midway, Konami, Capcom, Namco, and Activision (ATVI: Research, Estimates).

Activision's a pretty surprising name to see on that list, since it's the second largest U.S. publisher. Just a few weeks ago, in fact, analysts expected it to be buying other companies, rather than fending them off. But an earnings warning cutting its 2003 revenue forecast by 12 percent and earnings per share by 32 percent – along with several analyst downgrades - have take their toll on the company's stock, which has plunged from a 52-week high of $35.10 to just $13.47 per share at the close of trading Friday. It will likely cede the number two slot this year to Take Two Interactive Software (TTWO: Research, Estimates), which is powering its way to Wall Street respectability with the massive sales of its "Grand Theft Auto" games.

Convincing Activision, which makes the "Tony Hawk" line of skateboarding games, to sell would be difficult. Activision currently has cash reserves of over $900 million. And, as of late-May, CEO Bobby Kotick owned roughly 4.6 percent of the company's stock. Shawn Milne of SoundView Technology said Activision could be a potential takeover target, but any company planning such an action would likely have a fight on its hands.

Another thing that might dissuade potential Activision buyers is the company's lack of self-owned intellectual properties. With the exception of Tony Hawk, most of the games it makes are from licenses it has acquired.

"The thing an acquirer wants more than anything else is internal [intellectual properties]," said John Taylor of Arcadia. "This is the thing that has lasting value."

Sega, which is chock full of intellectual properties, has been a speculative target since the late-1990s, when it considered a buyout offer from Microsoft (MSFT: Research, Estimates). (The discussions, held directly between Sega CEO Isao Okawa and Microsoft founder Bill Gates, ultimately proved fruitless). Things have calmed down some over the last few years, but all of a sudden, insiders are speculating about Sega's fate again – with Microsoft and Nintendo often whispered as potential buyers.

Capcom has also been on Nintendo's shopping list, if you believe the rumor mill. Earlier this month, in fact, insiders were certain a buy-out would be announced. It never came to pass.

That's not to say Capcom isn't being shopped, though. A Capcom employee (who asked not to be named) said "there is validity to us being looked at by the bigger companies." With a software library that includes hits such as "Resident Evil", "Devil May Cry" and "Onimusha.", the company has franchise titles that can boost sales.

Similarly, Konami (which owns the "Metal Gear Solid" series and "Dance Dance Revolution"), Namco (the company behind "Dead to Rights" and the popular "Tekken" fighting games) and Eidos (which owns the "Tomb Raider" and "Hitman brands) have also attracted attention from potential buyers with their franchise-heavy title lists.

So who's thinking about buying? The names mentioned most often are Microsoft and Electronic Arts. Microsoft's cash reserves are legendary, of course. And Electronic Arts (ERTS: Research, Estimates) recently acknowledged it had a war-chest of roughly $1 billion.

"We don't have any specific short-term plans," said CEO Larry Probst said at the time. "There are opportunities out there that might require us to use a significant portion of that cash for an acquisition."

Sony (SNE: Research, Estimates), too, could be looking to expand.

"Sony could be thinking about beefing up their content as they get ready for the next console cycle," said Taylor.

Viacom and certain other big media companies have previously explored buying a stake in the gaming industry, as well. And with the growing convergence of the game and movie worlds, there's always the chance they could jump into the frey. Milne said he doesn't expect that immediately, though.

"I think they're going to need to see lower prices first," he said. "They're buyers of multiples of cash flow. If it gets ugly in the first quarter maybe they'll look around."  

Morris is Director of Content Development for CNN/Money. Click here to send him an email.