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Topic: Activision Blizzard Sold, to Activision Blizzard (Read 46171 times)
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Miasma
Terracotta Army
Posts: 5283
Stopgap Measure
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Teleku
Terracotta Army
Posts: 10510
https://i.imgur.com/mcj5kz7.png
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And lo, so it was that the next EA was born!
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"My great-grandfather did not travel across four thousand miles of the Atlantic Ocean to see this nation overrun by immigrants. He did it because he killed a man back in Ireland. That's the rumor." -Stephen Colbert
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Paelos
Contributor
Posts: 27075
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I'm selling my shares today. I bought in at 11.79 back in the days of "Will GW2 be the thing that kills WoW!?"
It's jumped almost 40% since then. It's been a good ride.
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CPA, CFO, Sports Fan, Game when I have the time
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koro
Terracotta Army
Posts: 2307
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proudft
Terracotta Army
Posts: 1228
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Set mine to sell too, at 17.35, might be shooting high, but who knows. Bought right before Cataclysm since it looked so awesome. Edit: it shot up to the 17.40s already, yeesh. Well, I hope they sell fast enough before it falls back down.
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« Last Edit: July 26, 2013, 09:54:12 AM by proudft »
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Paelos
Contributor
Posts: 27075
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It'll continue to dip from this point forward. There's no stopping it now. I'm getting out now not because of the jump, but because they flubbed Titan, and they flubbed D3 by trying to focus on console (which I honestly don't think will be a huge draw).
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CPA, CFO, Sports Fan, Game when I have the time
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Fabricated
Moderator
Posts: 8978
~Living the Dream~
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I can't wait for Blizzard's response to be "more dynamic" daily hubs, alternate unfun grinds to get catchup gear, and some brand new iteration of raid-type (even after flex-raid) instead of just you know, making the normal raids easy enough for most guilds.
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"The world is populated in the main by people who should not exist." - George Bernard Shaw
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Paelos
Contributor
Posts: 27075
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If the stock goes back to $12 again? I'll buy. I have confidence at that price point they'll continue to deliver long term, but it will be just that, a long term hold.
They have to fix D3 and put a good face on that, or the franchise is effectively dead. They have to come up with a multiplayer successor to WoW, and it doesn't necessarily have to be a full blown MMO. They have to position themselves in the market to be ready for the shift to the new consoles, and also understand that all their side stuff may not pan out (Hearthstone jumps to mind).
They also need WC4. I'd love to see them rip off and polish some ideas from Total War on that to revolutionize the game. The TW guys have never been able to produce a product that wasn't buggy as fuck, but Blizzard could.
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CPA, CFO, Sports Fan, Game when I have the time
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Nevermore
Terracotta Army
Posts: 4740
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Over and out.
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Trippy
Administrator
Posts: 23621
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With Vivendi no longer protecting the goose laying the golden eggs (Blizzard) I fully except Kotick to fuck things up even more than he already has.
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Merusk
Terracotta Army
Posts: 27449
Badge Whore
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Yes.
On the upside to that, expect some more great studios to spin-off from the folks who flee the ship before it goes Full EA.
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The past cannot be changed. The future is yet within your power.
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Typhon
Terracotta Army
Posts: 2493
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I think the 'before it goes full EA' ship has sailed.
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koro
Terracotta Army
Posts: 2307
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With Vivendi no longer protecting the goose laying the golden eggs (Blizzard) I fully except Kotick to fuck things up even more than he already has. Considering Vivendi was ramping up to start pumping Activision for pure cash dividends to pay off Vivendi's absurdly large debt and damn the consequences, the only thing they were going to be doing to the golden goose was strangling it.
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Miasma
Terracotta Army
Posts: 5283
Stopgap Measure
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It'll continue to dip from this point forward. There's no stopping it now. I'm getting out now not because of the jump, but because they flubbed Titan, and they flubbed D3 by trying to focus on console (which I honestly don't think will be a huge draw). This is what worries me. Activision has a bunch of cash right now but that's going away to pay for this, then they will probably have to finance some of it with debt. So the new, more independent company doesn't have a giant money pile anymore, their main cash cow WoW is on the decline, Blizzard doesn't have anything significant in the pipeline and Activision is mostly just Call of Duty which could be impacted by how well the next gen consoles sell. It seems kind of wobbly.
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Paelos
Contributor
Posts: 27075
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To be honest, I think because Blizzard has been sitting on that cash for so long, they've allowed a lot of dead weight in their overhead to run unchecked. Their SGA expenses represent 24% of the their revenues, up from 20% in 2010. That swing is higher by almost $250M in just overhead. That's not a good sign when they've cut R&D by $22M and 2% in the same time period.
EDIT: What I'm getting at is that they're running fatter staffs with less production. They need to trim up and empower the people who are actually doing a good job to keep producing. The products in the 2010>current time period have come up wanting in many regards.
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« Last Edit: July 26, 2013, 11:40:40 AM by Paelos »
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CPA, CFO, Sports Fan, Game when I have the time
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Ironwood
Terracotta Army
Posts: 28240
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EDIT: What I'm getting at is that they're running fatter staffs with less production. They need to trim up and empower the people who are actually doing a good job to keep producing. The products in the 2010>current time period have come up wanting in many regards.
Empower the People who are Good. When does that ever happen ?
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"Mr Soft Owl has Seen Some Shit." - Sun Tzu
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Ingmar
Terracotta Army
Posts: 19280
Auto Assault Affectionado
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24% of revenue on SG&A is not really troublingly high, I don't think.
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The Transcendent One: AH... THE ROGUE CONSTRUCT. Nordom: Sense of closure: imminent.
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Paelos
Contributor
Posts: 27075
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24% of revenue on SG&A is not really troublingly high, I don't think.
By no means. It's comparative. If the products they were putting out the door weren't flagging in terms of public opinion and subscriptions? I don't think it's an issue at all. When it's growing at the same time that the cash cow is shrinking? Over the long haul that percentage goes up.
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CPA, CFO, Sports Fan, Game when I have the time
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Merusk
Terracotta Army
Posts: 27449
Badge Whore
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EDIT: What I'm getting at is that they're running fatter staffs with less production. They need to trim up and empower the people who are actually doing a good job to keep producing. The products in the 2010>current time period have come up wanting in many regards.
Empower the People who are Good. When does that ever happen ? We can't fire him, he's a Vice-President!
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The past cannot be changed. The future is yet within your power.
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Ingmar
Terracotta Army
Posts: 19280
Auto Assault Affectionado
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24% of revenue on SG&A is not really troublingly high, I don't think.
By no means. It's comparative. If the products they were putting out the door weren't flagging in terms of public opinion and subscriptions? I don't think it's an issue at all. When it's growing at the same time that the cash cow is shrinking? Over the long haul that percentage goes up. Maybe - depending on how they categorize things a decent chunk of that 24% is probably the infrastructure (and maybe the CS teams?) that the games actually run on, so you'd expect at least something of a drop in operating costs as usage goes down.
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The Transcendent One: AH... THE ROGUE CONSTRUCT. Nordom: Sense of closure: imminent.
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Simond
Terracotta Army
Posts: 6742
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Yes.
On the upside to that, expect some more great studios to spin-off from the folks who flee the ship before it goes Full EA. Yeah, because "Studio full of ex-Blizzard" people has worked so well previously.
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"You're really a good person, aren't you? So, there's no path for you to take here. Go home. This isn't a place for someone like you."
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Fabricated
Moderator
Posts: 8978
~Living the Dream~
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It did get us Torchlight 1/2.
...and Hellgate, but whatever.
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"The world is populated in the main by people who should not exist." - George Bernard Shaw
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Paelos
Contributor
Posts: 27075
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I think it's going to be interesting to see how the business reacts. Do they stop paying dividends? Do they reinvest in higher R&D? These would be things I'd look at in the longer term to see what their product line looks like.
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CPA, CFO, Sports Fan, Game when I have the time
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Soulflame
Terracotta Army
Posts: 6486
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I assume Kotick is still in charge, so Blizzard will continue to fail in slow motion.
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Ironwood
Terracotta Army
Posts: 28240
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Yeah.
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"Mr Soft Owl has Seen Some Shit." - Sun Tzu
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Paelos
Contributor
Posts: 27075
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Currently articles like this one drive me crazy as a gamer: http://www.insidermonkey.com/blog/there-are-over-100-million-reasons-to-doubt-activision-blizzard-inc-atvi-211668/The gist of it is this - ACTIVISION ISN'T INTO MOBILE GAMING! DOOOOOOOOM! "On the company’s last earnings call, CEO Bobby Kotick downplayed the trend towards mobile gaming, saying that they just “don’t see anything” that would support a shift to mobile." Hate Kotick all you want, but I think he's right. I've never understood the obsession with "mobile gaming" from a AAA concern. There's not enough money in it to want to deal with it, but every time somebody wants to take a shot at Blizzard, it's usually over how they haven't embraced the stupid mobile gaming revolution. The mobile gaming shit is absurd.
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CPA, CFO, Sports Fan, Game when I have the time
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Lakov_Sanite
Terracotta Army
Posts: 7590
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Thing is, mobile gaming IS a cash cow but it's not a market that takes away from console/pc games it's a market that exists alongside it. No reason to get rid of one to foster the other.
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~a horrific, dark simulacrum that glares balefully at us, with evil intent.
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Paelos
Contributor
Posts: 27075
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I still don't believe it's a cash cow. I believe there is a demand for it, and that revenue exists, but just saying that their is $8 billion in revenue tells me nothing.
They always point to Zynga in these articles about mobile gaming as the gold standard. Last I checked, that company hasn't made money since 2010, and managed to lose money on over a billion in revenue in prior years. How is this successful exactly?
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CPA, CFO, Sports Fan, Game when I have the time
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Ingmar
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Posts: 19280
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Zynga does primarily Facebook games, not mobile games, unless I am very much mistaken. The people with the cash cow are the Angry Birds guys, etc.
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The Transcendent One: AH... THE ROGUE CONSTRUCT. Nordom: Sense of closure: imminent.
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Merusk
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Posts: 27449
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Lakov pointed out why people are losing their shit. As you said, AT-B doesn't *have* to get rid of AAA to move in to mobile and mobile is currently making decent money.
There's little reason they couldn't just divert a few dollars or buy-up a dev team to toss a game or three out the same way EA is. Instead they're choosing to ignore it entirely.
Yes, Zynga does Facebook games. Mobile games like Candy Crush, Temple Run <whatever> Icon Match, Angry Birds run on Tablets, PCs, Phones and hook-in to Facebook but don't require you to be ON Facebook. They also have steady revenues that people will simply buy in to once you have a good hook on the gameplay.
Incentivize it without making it ludicrous and suddenly the nickel-and-diming is palatable. "Oh, I need to get past this level on Candy Crush, I'll drop $.99 for those mallets/ extra moves. I'm sooo close!" "Oh, a new season of Angry Birds is out! Sure take my $6!"
Hell this site has it's own little 'mobile games' section.
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The past cannot be changed. The future is yet within your power.
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Typhon
Terracotta Army
Posts: 2493
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If Blizzard wanted to do a CCG, mobile was the place to do it. For many reasons.
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Trippy
Administrator
Posts: 23621
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I still don't believe it's a cash cow. I believe there is a demand for it, and that revenue exists, but just saying that their is $8 billion in revenue tells me nothing.
They always point to Zynga in these articles about mobile gaming as the gold standard. Last I checked, that company hasn't made money since 2010, and managed to lose money on over a billion in revenue in prior years. How is this successful exactly?
For EA, ~20% of their Non-GAAP revenue ($104 million) came from mobile games last quarter. That's why people are asking what Activision's mobile strategy is.
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Paelos
Contributor
Posts: 27075
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Sure as a number that sounds fine. Activision's operating profit has been over a billion for the last 2 years. Not revenues (those were over 4.5B) but actual operating takehome after expenses. EA managed to make a profit of of $121M on $3.8B in revenue.
My point is this: Why should ATVI give a fuck what other people are doing? They aren't operating in the same stratosphere. Mobile gaming, even if you can make $150M in revenues or whatever, that's all well and good, but it's not exactly breaking the bank on returns.
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CPA, CFO, Sports Fan, Game when I have the time
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Lakov_Sanite
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Posts: 7590
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Why shouldn't they?
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~a horrific, dark simulacrum that glares balefully at us, with evil intent.
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Paelos
Contributor
Posts: 27075
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Because even allocating a single dollar away from a high margin activity to a lower margin activity is silly.
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CPA, CFO, Sports Fan, Game when I have the time
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