I knew this thread would be epic from the beginning.

DMeisterJ said: I knew this thread would be epic from the beginning.

Come on, it's not that epic. I don't see any meltdowns, barely any repeated myths and the most delusional members aren't even posting here yet.

 

HappySqurriel said: On a side note, my questions weren't there to imply "HD console's can not be profitable" but were serious questions that someone should ask the CEO of a major corporation ... The fact is he is legally obligated to maximize the profits of his company and that means (regardless of whether you like it or not) if it would be more profitable for EA to make 4 small games for the Wii than to produce Madden for the HD Consoles he is supposed to make the 4 small Wii games. There is a certain ammount of freedom he is given to focus on long term profits over shorter term profits, but he should be able to explain his motivations in an intelligent manner.

 

While small profitable games are good for revenue and profit and the short term bottom line they are not what impact significantly the stock price of a company.

Successfull franchises with successfull iterations ( ie IP) is what make or break a company stock price.

For how much did the success of Carnival games count into the EA offer to purchase Take Two ? very little I would expect...

The issue with profitable/small costs games that don't develop into huge franchises is that every year you have to repeat the success story. Whereas future revenue is easier to predict with huge successfull franchises and this is what stockholders are looking for.............

You need a mix of both to successfully run a game development company ( unless you are Blizzard) but in the end the sucessfull IP is what will most affect how the company is valued..

 

 

Ail said: HappySqurriel said: On a side note, my questions weren't there to imply "HD console's can not be profitable" but were serious questions that someone should ask the CEO of a major corporation ... The fact is he is legally obligated to maximize the profits of his company and that means (regardless of whether you like it or not) if it would be more profitable for EA to make 4 small games for the Wii than to produce Madden for the HD Consoles he is supposed to make the 4 small Wii games. There is a certain ammount of freedom he is given to focus on long term profits over shorter term profits, but he should be able to explain his motivations in an intelligent manner.   While small profitable games are good for revenue and profit and the short term bottom line they are not what impact significantly the stock price of a company. Successfull franchises with successfull iterations ( ie IP) is what make or break a company stock price. For how much did the success of Carnival games count into the EA offer to purchase Take Two ? very little I would expect... The issue with profitable/small costs games that don't develop into huge franchises is that every year you have to repeat the success story. Whereas future revenue is easier to predict with huge successfull franchises and this is what stockholders are looking for............. You need a mix of both to successfully run a game development company ( unless you are Blizzard) but in the end the sucessfull IP is what will most affect how the company is valued..

/end Your Perception

Many assumed it was for GTAIV, others argued it was a bid to buy out 2k sports series, but just like no one assumed Carnival games would sell no one assumed carnival games was the objective of the acquisition.

 

 

I'm not saying it was, mainly because I don't want to assume anything aside from neither you nor I work within that circle of EA or Take 2.

 

HappySqurriel said: bumidan said: You have to take into account revenue and profit. If EA had a 20% decline in revenue, but a 20% increase in profit, their stock would take a massive plunge.   I doubt it ... I have seen countless companies close unprofitable divisions (which will result in lower revenue and higher profit) and the second the announcement is made their stock tends to rise very quickly.

That is only true in a market in recession or at least experimenting difficulties...

Each time Ford and GM close a plant their stock price goes up because every car maker is suffering and it's an understanding among stockholders that everything needs to be done to survive and turn a profit.

Same thing for Airlines..

Now in the game development market that is experiencing a 20%+ growth a year, and where there are companies turning huge profits while experiencing growth at the same time, I doubt a 20% decrease in revenue would be that welcomed for EA....( especially considering they have been touting themselves as the first 3rd party developer in the world and such a move would put them suddenly way behind Activision/Blizzard).

 

You guys have to remember something. Stock price doesn't reflect so much what a company has accomplished up to the present but much more what is the potential for the company in the future years ( or you wouldn't have companies trading at 30+ P/E).

 

 

 

dib8rman said: Ail said: HappySqurriel said: On a side note, my questions weren't there to imply "HD console's can not be profitable" but were serious questions that someone should ask the CEO of a major corporation ... The fact is he is legally obligated to maximize the profits of his company and that means (regardless of whether you like it or not) if it would be more profitable for EA to make 4 small games for the Wii than to produce Madden for the HD Consoles he is supposed to make the 4 small Wii games. There is a certain ammount of freedom he is given to focus on long term profits over shorter term profits, but he should be able to explain his motivations in an intelligent manner.   While small profitable games are good for revenue and profit and the short term bottom line they are not what impact significantly the stock price of a company. Successfull franchises with successfull iterations ( ie IP) is what make or break a company stock price. For how much did the success of Carnival games count into the EA offer to purchase Take Two ? very little I would expect... The issue with profitable/small costs games that don't develop into huge franchises is that every year you have to repeat the success story. Whereas future revenue is easier to predict with huge successfull franchises and this is what stockholders are looking for............. You need a mix of both to successfully run a game development company ( unless you are Blizzard) but in the end the sucessfull IP is what will most affect how the company is valued..     /end Your Perception Many assumed it was for GTAIV, others argued it was a bid to buy out 2k sports series, but just like no one assumed Carnival games would sell no one assumed carnival games was the objective of the acquisition.     I'm not saying it was, mainly because I don't want to assume anything aside from neither you nor I work within that circle of EA or Take 2.

 

There's been a lot of speculation that the EA deal for TakeTwo would not be a good deal if either the 2k team or the Rockstar team left the newly merged company.

I have yet to find one person saying the deal would be bad if the Carnival Games team left :P

 

@AIL

Last time I checked Microsoft was number 16ish, Sony was number 12ish and EA was around 2~3 with Nintendo being number 1... now if I remember correctly Nintendo only developes for Nintendo platforms.

EA just announced they are moving development to the Wii and DS, the only two Nintendo platforms that are being supported.

dib8rman said: @AIL Last time I checked Microsoft was number 16ish, Sony was number 12ish and EA was around 2~3 with Nintendo being number 1... now if I remember correctly Nintendo only developes for Nintendo platforms. EA just announced they are moving development to the Wii and DS, the only two Nintendo platforms that are being supported.

 

 I said number 1 third party developer.

You confirm what I said as Nintendo isn't a third party developer.

The newly formed Activision/Blizzard should easilly top EA next year though.....

EA had 4 billion revenue the last fiscal year.

 

Blizzard by itself will have probably over 1.2 billion $ revenue this coming year ( expansion release will fuel revenue and the number of subscribers has never been so high). Activision had 2.9 billion$ revenue last year..

 

I think many of them were simply rushed and were indeed of low quality. But for me they are simply a different kind of game. I think the userbase has never been that parted between different people buying different systems. Because of this NJ5 is pretty far off field when he says that the Wii would destroy the PS3 if the 360 wouldn't exist. (or the 360 if the PS3 wouldn't exist). 360 developers and gamers would simply switch to the PS3. People who like FPS, online gaming, media functionality, beautiful graphics, racing sims simply wouldn't buy a Wii. And if you want to play with a couple of friends you will not buy a PS3 or 360.





Yeah sure. Do you know how the discussion between a publisher and a developer who made them a 9m game goes?

Activision: Hey IW could you target a platform you didn't intend to develop for?

Infinity Ward: We don't think so, we want to create a game that is as realistic as possible and we do not have resources for a port.

Activision: We are ordering you to do the port.

Infinity Ward: Do you remember how much CoD4 made you? I hear Vivendi and EA would like to publish our games.

Activision: Never mind.

Kyros said: Why do people always act like "party games" and "music games" don't count? Or are always low quality? I think many of them were simply rushed and were indeed of low quality. But for me they are simply a different kind of game. I think the userbase has never been that parted between different people buying different systems. Because of this NJ5 is pretty far off field when he says that the Wii would destroy the PS3 if the 360 wouldn't exist. (or the 360 if the PS3 wouldn't exist). 360 developers and gamers would simply switch to the PS3. People who like FPS, online gaming, media functionality, beautiful graphics, racing sims simply wouldn't buy a Wii. And if you want to play with a couple of friends you will not buy a PS3 or 360. Not like IW would have much say in the matter, as Activision would be the one influencing the platforms. Yeah sure. Do you know how the discussion between a publisher and a developer who made them a 9m game goes? Activision: Hey IW could you target a platform you didn't intend to develop for? Infinity Ward: We don't think so, we want to create a game that is as realistic as possible and we do not have resources for a port. Activision: We are ordering you to do the port. Infinity Ward: Do you remember how much CoD4 made you? I hear Vivendi and EA would like to publish our games. Activision: Never mind.

To be fair there are only a handfull of development studios that can act like that in the world.

Aside from Rockstar, Bungie, IW, 2K, most of the others developers can't act that way ( Blizzard is developer and publisher so this is different).