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Forums - Gaming Discussion - Apple has a $200 billion war chest, should it buy Nintendo and Sega?

Roderic_Blackwood said:
Soleron said:

It already is a duopoly. Nintendo still exist but the games they make no longer appeal to 20m+ people per title. They have no cultural impact any more; they've let the perception of gaming be dominated by GTA, CoD and Minecraft through inaction.

A buyout or major change of strategy could provide the catalyst for a return to relevance.

I completely disagree with you, it seems that you have forgotten that the Wii (still alive) has a lot of games with not only 20 million + but 30 m+ and 40m+ sold copies! The Wii U also has an impressive attach rate and I haven't seen anPS4 or XBOne game that surpass the 10m+, just in PS360 but in Wii as well and those systems are selling better than the Wii U so Nintendo sells more First Party software than Sony and Microsoft togheter,  and no one has reached the 3DS, the best selling system in this generation (and a lot of people seems to forget this), so duopoly? I don't think so, unless you said that there's a duopoly selling the same specs, same graphics, same old same stuff which yes, you're a correct. And it's funy: No cultural impact? LOL , maybe you haven't seen Smash Bros. or Pokémon or Zelda or Mario, icons of the videogame inustry and pop culture. I have no idea what's the name of the GTA V main character, I even know the entire Watch Dogs crew! And I do acknowledge GTA V success but it sells on the PS3, 360, PC, XBOne, PS4, 5 platforms against Nintendo, fighting on its own and doing fine right now.

^^^^^^^^^^^^^^^excellent point Roderic why can't most people understand this ...very valid points ...that is why Sony's PlayStation head said he wants Sony to sell more first party software ...that is where the money is at (first party no middleman) straight profit



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It might be a good move for Apple to broaden their horizons. However, I do not see them being able to purchase Nintendo or Sega. Both companies have conservative management and quite conservative shareholders that will not accept a buyout or takeover offer by a foreign company. In addition, there is a high chance that the Japanese government would intervene (they have a history of doing so, especially when it comes to symbolic and/or historical businesses) even a takeover was agreed to by the management and/or shareholders.

Apple's best chance with Sega and Nintendo would probably be to form a partnership with them that makes them exclusive developers for their platform. With that being said though, Apple might be better off looking to acquire Western companies because there are far fewer barriers that they would have to deal with.



H.E.R. said:
LurkerJ said:

"the iPad Pro flopped and the iPad sales are in continuous decline but that doesn't scream sheep mentality but I am just gonna ignore that fact so that I can make the point of Apple products being celebrated for no particular reason" .... basically.

As for the Apple Watch, it's wildy regarded as a relative flop, some random report will not change that. But let's talk about smartwatches... Smartwatches of today will not sell based on their smart capabilities, maybe in the future, but for now, people buy them for the same reason they bought watches in the past; fashionability. Thankfully, the Apple Watch looks elegant and Apple has done a great covering a wide range of consumers' taste. So being a useless tech shouldn't stop it from attracting buyers. With that said, the "12 million" figure remains an unproven estimate like many other published estimates predicting the sales of the Apple Watch. Hopefully, the number is true because I like seeing Apple's success pissing people off

"Fashionability"? What person would rather buy an Apple Watch over another regular $400 Bulova, Movado, Seiko, or Coach that only tells time for the sake of fashionability? I'm willing to bet the majority of people who bought an Apple Watch hadn't even thought about purchasing a smartwatch and simply bought it because they know Apple made it. Still no killer software for the Apple Watch (or smartwatches in general) with low attach rate (8% according to a December Forbes article). That is sheep mentality.

And if the 12 million figure is true, that still probably doesn't make Apple happy since they would usually release public sales like they do for their other mainstream products in their quarterly reports.

Apple can't be among those established watche makers (in bold) because???? 

Like it or not, most reviews agreed on one thing, the Apple Watch is sleek and it's fashionable. I am not sure why we are arguing this, Apple positioned themselves as a manufacturer of stylish tech long before the Apple Watch was released. So Apple fans who use Apple products looking to buy a fashionable watch can't be labeled as sheep for purchasing Apple Watches because you are just "willing to bet the majority" bought it for the Apple logo.

The report you are citing mentions that the other smartwatches haven't done too bad, 6 million units sold! And by your logic, shouldn't you be also asking how come that many units were sold? they are still not smart watches, same pathetic battery life, and above all, most look like garbage and not stylish at all. But hey, those are not sheep because they are buying some non-Apple Watch. 

I personally think if the 12 million figure is true, Apple would've mentioned it. Not bad at all for a first gen-product that hasn't nearly lived-up to its full potential thanks to battery-life constraints. Apple couldn't wait and watch developers only work on Android Wear. The product had to be released in its current state to get the ball rolling, just like they did with the first iPhone, iPad etc. And thankfully, it got a major selling point and an edge over its competitors when it comes fashionability that almost every review agrees with. 

And again, convenient omission of the iPad and other Apple products that "the sheep" aren't rescuing. If I make posts about how the Wii is a fad and people bought it because they are sheep, PS4 is selling thanks to hype and brand and not games, people are idiots for paying for PSN/Xbox Live when they can game online for free on PC etc, that wouldn't be acceptable. Capitalizing on a momentum is a smart thing to do, and you can't capitalize with crappy products or sevices.

I am abandoning this thread because it's extremely silly (not the conversation I am having with you), most of the posts here make me cringe. feel free to post a topic that discusses the points we are talking about and I'll participate.



kowenicki said:
Teeqoz said:

I just gave you a link to Apple's balance sheet. It's compiled information from Apple's latest Form 10-Q report to the SEC commitee. They can't lie there.

Beat me to it. I was about to post the balance sheet too, but I fear it would be ponitless.

This thread is just cringe-worthy on an entirely different level.



kowenicki said:
Teeqoz said:

I just gave you a link to Apple's balance sheet. It's compiled information from Apple's latest Form 10-Q report to the SEC commitee. They can't lie there.

Beat me to it. I was about to post the balance sheet too, but I fear it would be ponitless.

The discussion started out with a silly trollish proposal and it didn't rise to a factual level. Haven't we all stooped to his level and thrown back juvenile proposals? We are being too simplistic for no particular reason other than fitting in. Ofc the 200b aren't ready to be spent but Apple still has enough cash, cash investments, marketable securities to afford major buyouts. 



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LurkerJ said:
kowenicki said:

Beat me to it. I was about to post the balance sheet too, but I fear it would be ponitless.

The discussion started out with a silly trollish proposal and it didn't rise to a factual level. Haven't we all stooped to his level and thrown back juvenile proposals? We are being too simplistic for no particular reason other than fitting in. Ofc the 200b aren't ready to be spent but Apple still has enough cash, cash investments, marketable securities to afford major buyouts. 

Not Microsoft though...



CGI-Quality said:
Soundwave said:
They might not be able to buy MS just quite yet ... but they're getting there. 

They are? Does anyone has sources for this? I've asked once already, but based on what, do they have enough to buy MS? Do people REALLY believe that Apple could, one day, buy MS? Really?

Apple has $16.7b in cash, $21.4b in short term investments, $24.6b in receivables, and $177.7b in long term investments.  For the sake of argument, if they were to use all of that, that would give them $240.4b.

Microsoft's market capitalization is $393b.  To buy a controlling share in Microsoft, you would need to buy 50% + 1 shares, or roughly $200b worth.  Generally, when you do you do a buyout, you have to do it at a premium.  A 20% premium would be $240b.  So technically, Apple has enough available to buy Microsoft, even without resorting to a stock swap.  

Having said that, this approach is not really possible, as Apple most likely doesn't have easy access to those long term investments (or they may come at a penalty if they are cashed out early).  Apple could do a cash + stock deal, where they spend $30b in cash and $210b in stock (where eash MS investor would get 1 Apple share per 2 MS shares, using today's rates).  Apple would need to convince their shareholders that this is a good deal, as $210b is just under half the value of Apple.

This whole thing would also have to get approval from the SEC, and considering that both Apple and MS make operating systems, this would essentially give Apple a monopoly.  The SEC would most likely block this from ever happening.

And no, I honestly think this will not happen.



Teeqoz said:
LurkerJ said:

The discussion started out with a silly trollish proposal and it didn't rise to a factual level. Haven't we all stooped to his level and thrown back juvenile proposals? We are being too simplistic for no particular reason other than fitting in. Ofc the 200b aren't ready to be spent but Apple still has enough cash, cash investments, marketable securities to afford major buyouts. 

Not Microsoft though...

Not MS, no. That's one adorable shiba.



DM235 said:
CGI-Quality said:

They are? Does anyone has sources for this? I've asked once already, but based on what, do they have enough to buy MS? Do people REALLY believe that Apple could, one day, buy MS? Really?

Apple has $16.7b in cash, $21.4b in short term investments, $24.6b in receivables, and $177.7b in long term investments.  For the sake of argument, if they were to use all of that, that would give them $240.4b.

Microsoft's market capitalization is $393b.  To buy a controlling share in Microsoft, you would need to buy 50% + 1 shares, or roughly $200b worth.  Generally, when you do you do a buyout, you have to do it at a premium.  A 20% premium would be $240b.  So technically, Apple has enough available to buy Microsoft, even without resorting to a stock swap.  

Having said that, this approach is not really possible, as Apple most likely doesn't have easy access to those long term investments (or they may come at a penalty if they are cashed out early).  Apple could do a cash + stock deal, where they spend $30b in cash and $210b in stock (where eash MS investor would get 1 Apple share per 2 MS shares, using today's rates).  Apple would need to convince their shareholders that this is a good deal, as $210b is just under half the value of Apple.

This whole thing would also have to get approval from the SEC, and considering that both Apple and MS make operating systems, this would essentially give Apple a monopoly.  The SEC would most likely block this from ever happening.

And no, I honestly think this will not happen.

Good post. But it does show it's not impossible, especially if MS' market cap dropped, but you're right the SEC would likely block any type of move like this on the grounds of it being a monopoly. 

Sony could buy Nintendo or Sony fairly easily, it's just not worth it to them. Video game console sales are piddly compared to the iPhone sales they're used to. 

A hugely successful, usually market leading console sells maybe 100 million units in 5-6 years and low profit margin (sometimes a net loss). The iPhone sells 74-75 million units in *three months* sometimes (a quarter) at a huge profit margin.

Sony isn't exactly that attractive outside of the a few divisions. Nintendo just does video games. 

Not really worth it. If Apple really wanted to make a game console they easily could do so themselves and probably sell 40-60 million fairly easily if they took it seriously. They would get a ton of third party support. 

If they wanted to get into the game business I'd reccomend to them to buy a third party company like a Square-Enix for about $3-$4 billion, which would much cheaper than buying a Nintendo. An Apple console with S-E exclusive and lots of third party support, competent hardware, and lots of marketing would be a far cheaper way for Apple to get into the console biz if that's what they want, but I don't think they want that. It's just not lucrative enough of a business for them to care. 



CGI-Quality said:
Soundwave said:

Good post. But it does show it's not impossible, especially if MS' market cap dropped, but you're right the SEC would likely block any type of move like this on the grounds of it being a monopoly. 

Sony could buy Nintendo or Sony fairly easily, it's just not worth it to them. Video game console sales are piddly compared to the iPhone sales they're used to. 

A hugely successful, usually market leading console sells maybe 100 million units in 5-6 years and low profit margin (sometimes a net loss). The iPhone sells 74-75 million units in *three months* sometimes (a quarter) at a huge profit margin.

Sony isn't exactly that attractive outside of the a few divisions. Nintendo just does video games. 

Not really worth it. If Apple really wanted to make a game console they easily could do so themselves and probably sell 40-60 million fairly easily if they took it seriously. They would get a ton of third party support. 

If they wanted to get into the game business I'd reccomend to them to buy a third party company like a Square-Enix for about $3-$4 billion, which would much cheaper than buying a Nintendo. An Apple console with S-E exclusive and lots of third party support, competent hardware, and lots of marketing would be a far cheaper way for Apple to get into the console biz if that's what they want, but I don't think they want that. It's just not lucrative enough of a business for them to care. 

Your argument was also that they could buy MS. Do you see now how that's not so clear cut?

And yes, DM235, excellent post! Couldn't have put it better.

Actually that shows it's *possible* especially if MS' market cap drops and Apple's cash pile continues to rise (likely). I never said it would be easy.