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[Sneakysnake]

Let's look at the math here

Sony purchases a smaller dev Insomniac for $229 million who have talent but little known IP

They now have a consistent 20 million selling IP in Spiderman

If for some crazy set of circumstances Capcom wanted to sell and Sony bought them it would cost them 5 billion dollars, and they only have a couple 10 million (at best) selling franchises that are less impressive even because they're multiplats.


MS's never ending pockets can afford them to make ridiculous purchases like 70 billion for COD.

A strategy that may be good for one is not good for the other.

Nintendo is breaking sales records for Switch with first party studios alone and a lot of those games are pretty low budget to make.

Playstation's brand value and development talent is what's going to see them through because all their first party franchises are starting to put up the big numbers

GOT 8 million
Horizon well over 10 million
GOW 20 million plus
Spiderman 20 million plus

I think you are correct. Sony and MS are doing different things. Sony can continue to be extremely successful making the best single player story driven games on a traditional console and MS can go out and get ahead of Netflix, FB, Google and other tech companies to be the best at gaming subscription service. This truly is not a console war anymore. It's not. Heck, Nintendo is probably more likely to be Sony's "rival" going forward.

 

[Joey.]

Yes, PlayStation will be fine.
All three are doing good things and all will be fine.
Therefore, get all 3 = ultimate gaming happiness.

 

[SteelCurtain 59]

Not to pick on you SteelCurtain 59 , but your paragraph above perfectly illustrates how financial topics in this thread are both misunderstood and erroneously applied.

You said they turned $70b into an asset, but then follow up with: "They didn't lose anything and there's nothing they need to recoup. Activision-Blizzard is still worth roughly 70 billion in Microsoft's eyes". In finance, value/worth is measured in currency. So since Microsoft spends $70b, they are in the red until profits are generated. This is a basic concept. You also say "there's nothing they need to recoup". Every financial investment is made with the intention to recoup/break-even and then make a profit either through income or subsequent sale. Again this is another basic concept that, without full grasp and understanding, makes it tough for discussions to progress in a substantive way.
,
Next, you say "As long as Activision gives a higher return than the amount that money would've gained in interest then Microsoft is happy with this acquisition". This isn't true. Microsoft could have also invested the money in one of their already existing internal studios, or they could have invested into one of their other business units outside of gaming, or they could invest in an index fund, etc. The opportunity cost is nowhere near limited to what they could earn from their bank account.

Finally, you say because this is Microsoft's 2nd largest acquisition, there is no opportunity cost. Again, this is wrong; as you pointed out, Microsoft was earning interest on that $70b that they use to purchase Activision. The interest that they could have continued to earn is literally the textbook definition of an opportunity cost.


All of the above is why we never get anywhere when discussing this topic. To be clear, I'm not denying the possibility that financial benefits exist for Microsoft in a scenario where CoD becomes exclusive, just that no one here has properly supported this position with a sound understanding and correct application of financial concepts.

Acquisitions are not an expense on the income statement. That's just factually incorrect.
https://yourbusiness.azcentral.com/acquisitions-affect-income-statement-25934.html
https://smallbusiness.chron.com/basic-calculating-net-cost-net-gain-39320.html


At most it would turn up as an expense if Microsoft paid more than they valued them at, but that wouldn't be anywhere near the full $70 billion cost, just the difference between the price they paid and the price they value Activision as.

As for the opportunity cost bit, sure that specific $70 billion they can't spend on other things, but they have more than enough cash on hand to make any amount of acquisitions they realistically were going to make with that money, so the reason they don't use that money elsewhere is mostly due to them not wanting to make an acquisition rather than being restricted by the money they spent on Activision.

Once again, Activision's assets and liabilities just become Microsoft's, if the income statement is affected from this (by means of stuff like lawyer costs/transactional costs etc.) it's nowhere in the same stratosphere as $70 billion



Let me answer your last paragraph. Absolute worst case scenario, Microsoft makes just over twice as much money from an average COD player on Xbox than Playstation, with every single microtransaction or game purchase widening the gap. ($49 vs $120 yearly assuming the COD player buys Gold/Game Pass or PS+, which seems logical). COD is possibly the single biggest system seller that could exist, with only GTA, Fortnite, Minecraft, or FIFA/Madden (all multiplat) even being close. In the absolute doomsday scenario they need 41% (49/120) of Playstation COD players to switch from Playstation to Xbox/PC/Streaming, likely would be much lower as the bigger COD fans spend a disproportionate amount more on COD than the average fans, and they are the ones most likely to move, plus even the most "casual" COD players will probably play other games at least occasionally, which Microsoft gets 30% from as opposed to 0 on the Playstation store. Plus a non zero amount of Playstation COD fans would become enticed with Game Pass and become subscribers into that ecosystem.

It's really not that hard to imagine why exclusive COD is likely more lucrative in the long term than multiplat COD, because of all the secondary revenue that they can get.(Obviously not guaranteed, but unless the majority of COD fans are more attached to Playstation than COD then I don't think it's unreasonable to assume enough switch) Not to mention tons of other secondary effects, like how those people will have friends who could switch to Xbox too, or things like market share increases which make Sony's timed/permanent exclusive deals more expensive, leading to less of them happening, leading to more games coming to Xbox, which again, leads to more money for Xbox. Releasing COD on Playstation is basically selling the long term for the short term, which isn't what mega corporations like Microsoft typically do, and flies in the face of basically everything Xbox has been trying to do with Game Pass

 

[ChiefDada]

Acquisitions are not an expense on the income statement. That's just factually incorrect.

Notice how I never said that they were. Companies with investments that are in the red do not always need to post expenses on an income statement. An investment will be in the red until enough profits are generated to reach break-even. Your quote above along with the rest of your reply is plagued by a continuous misunderstanding of financial concepts.

 

[SteelCurtain 59]

Notice how I never said that they were. Companies with investments that are in the red do not always need to post expenses on an income statement. An investment will be in the red until enough profits are generated to reach break-even. Your quote above along with the rest of your reply is plagued by a continuous misunderstanding of financial concepts.

Even if literally all of my "understanding of financial concepts" is completely and utterly wrong on all levels, you still haven't attempted to respond to any of my comments using numbers and logic to ascertain why Microsoft will almost certainly make more money by making COD exclusive, which would help them get "out of the red" quicker. Which of my assumptions is incorrect? Which numbers am I using incorrectly? I'd love to hear your thoughts that dispute what I said instead of just picking out one random small part of my posts and ignoring the rest.

Selling COD on Playstation does two things for Microsoft

1. 70% of revenue from COD (large but not game changing for somebody like Microsoft)
2. Removes incentive for that person to buy an Xbox or subscribe to Game Pass (way worse than any benefits from #1)

Let's say the average person who buys COD buys 2 more games a year (some will obviously buy more, some less), and buys Gold/PS+ at $60/year
The person on Playstation earns Microsoft $49/year (70% of $70 game)
The person on Xbox earns Microsoft $156/year (100% of $60 game + 100% of $60 Gold + 30% of 2 games)

That doesn't even account for any microtransactions (of which Microsoft earns 100% vs 70% on Playstation), or potential to subscribe to Game Pass that is lost when playing on Playstation.

So as long as Microsoft is able to get 31.4% (49/156) of Playstation COD players to play COD on Xbox/PC (even if it's a Series S), they will make just as much money if not more. Even if we assume the average COD player buys literally 0 games other than COD (an incredibly pessimistic assumption, but we'll do it anyways), then it would still be $120 vs $49, and only need 40.8% of COD players to play COD on Xbox/PC instead (even if literally every other game they play is on Playstation)

Now obviously it's hard to say with exact certainty how many people would buy/switch to Xbox/PC, but I feel fairly confident that enough people would switch to Xbox for at least to be a similar amount of revenue (and with the potential for all the microtransactions, and Game Pass subscribers they could gain, it would be a no brainer unless all those "casual COD gamers" are somehow more allegiant to Playstation than COD (spoiler alert: they're not)


Feel free to question any numbers I used or assumptions I make, but I can't see a realistic way where Microsoft makes more money long term from keeping COD on Playstation, outside of Game Pass coming to Playstation

I really want to know what your arguments against this are. Do you think COD fans aren't going to switch to Xbox in large quantities? Do you think COD fans won't buy PS+/Gold? I want to hear why you think any of this is wrong, and what logic and reasons you used to come to that conclusion. You asked me to support my conclusion with evidence and you have yet to respond to this in any way shape or form

 

[EDMIX]

Let's look at the math here

Sony purchases a smaller dev Insomniac for $229 million who have talent but little known IP

They now have a consistent 20 million selling IP in Spiderman

If for some crazy set of circumstances Capcom wanted to sell and Sony bought them it would cost them 5 billion dollars, and they only have a couple 10 million (at best) selling franchises that are less impressive even because they're multiplats.


MS's never ending pockets can afford them to make ridiculous purchases like 70 billion for COD.

A strategy that may be good for one is not good for the other.

Nintendo is breaking sales records for Switch with first party studios alone and a lot of those games are pretty low budget to make.

Playstation's brand value and development talent is what's going to see them through because all their first party franchises are starting to put up the big numbers

GOT 8 million
Horizon well over 10 million
GOW 20 million plus
Spiderman 20 million plus

lol....maybe.


You make some valid point, I won't disagree with anything posted, simply that MS buying such a publisher messes with Sony's plans for support, which means they might need to consider buying a publisher of their own simply to stay competitive in several areas to solidify future support that is now in jeopardy of being bought by MS.


So I agree that Sony got Insomniac for a fucking steal as Spiderman is moving 20 million units and even the smaller "dlc" is moving massive fucking units, Spiderman 2 and Wolverine are going to do fucking gangbusters for Sony, but shit....not many teams really exist like that, if MS is out here buying entire publishers, Sony needs to reconsider and they might want to seek a publisher to fill that gap that is soon going to be empty. MS has forced their hand in this situation and I'd agree with you for them to continue the same thing........if MS never bought Zenimax and Activision. When they were just buying teams, it makes sense for Sony to just continue to do the same, when they bought a publisher, this changed everything as we are not just talking about MS buying DoubleFine here, we are talking about multiple genres and multiple IP no longer coming to PS that Sony likely was going to rely on to fill some gap, its why Sony doesn't even put out much games during the fall, they want 3rd party to have all the time to shine and get freedom to have a open market and not compete with any of Sony's massive games.

So I never thought I'd see the day where God Of War or Spiderman moved 20 million plus units, but that is nothing comparied to COD moving that number, shit...COD moving 20 million is LOW, its something people state when they want to pretend the IP is dying or on its last legs lol (The massive lolz)

So they should continue to look to grow organically as yes, it is cheaper and with the right support, some fucking diamonds can be made, but they need to also maintain getting some of those IP that are staple to PS and Sony's strategy.

shiiiiiiiiiit i'm willing to agree with 99% of what you said.....until MS started buying 3rd party publishers lol This is a situation where Sony should indeed keep buying smaller, but they might need a publisher under their belt just to keep up at this point or prepare for the future etc.

 

[schaft0620]

If I were in charge of Sony here is what I would do in 2022:

1. Build a new studio in Austin TX (Not second party)
2. Build a new studio in NY, NY (Not second party)
3. Add a second team alongside ASOBI
4. Beg Kojima and I mean BEG
5. Buy First Contact Entertainment and have them do a VR spin-off of SOCOM
6. Make sure you get a seat at the table with Devolver, CAPCOM, SEGA, Square, EA to block any future takeover.
7. Incubate an NFL game at San Diego under MLB. Try to get in that deal when it's up next year.
8. Aquire very specific IP and back catalog rights like Metal Gear, Silent Hill, Earthworm Jim, Persona.

 

[clarky]

Even if literally all of my "understanding of financial concepts" is completely and utterly wrong on all levels, you still haven't attempted to respond to any of my comments using numbers and logic to ascertain why Microsoft will almost certainly make more money by making COD exclusive, which would help them get "out of the red" quicker. Which of my assumptions is incorrect? Which numbers am I using incorrectly? I'd love to hear your thoughts that dispute what I said instead of just picking out one random small part of my posts and ignoring the rest.




I really want to know what your arguments against this are. Do you think COD fans aren't going to switch to Xbox in large quantities? Do you think COD fans won't buy PS+/Gold? I want to hear why you think any of this is wrong, and what logic and reasons you used to come to that conclusion. You asked me to support my conclusion with evidence and you have yet to respond to this in any way shape or form

Its pointless. I'd just give up, I did a page or 2 ago. There's no way your getting any reasonable counter or discussion.

 

[ChiefDada]

Even if literally all of my "understanding of financial concepts" is completely and utterly wrong on all levels, you still haven't attempted to respond to any of my comments using numbers and logic to ascertain why Microsoft will almost certainly make more money by making COD exclusive, which would help them get "out of the red" quicker. Which of my assumptions is incorrect? Which numbers am I using incorrectly? I'd love to hear your thoughts that dispute what I said instead of just picking out one random small part of my posts and ignoring the rest.




I really want to know what your arguments against this are. Do you think COD fans aren't going to switch to Xbox in large quantities? Do you think COD fans won't buy PS+/Gold? I want to hear why you think any of this is wrong, and what logic and reasons you used to come to that conclusion. You asked me to support my conclusion with evidence and you have yet to respond to this in any way shape or form

I'm really sorry I must have missed when you initially sent this. My main contention is with the bolded below:

Let's say the average person who buys COD buys 2 more games a year (some will obviously buy more, some less), and buys Gold/PS+ at $60/year
The person on Playstation earns Microsoft $49/year (70% of $70 game)
The person on Xbox earns Microsoft $156/year (100% of $60 game + 100% of $60 Gold + 30% of 2 games)

Why is the Xbox player paying full price with GP? Someone else gave me a similar example which leads me to believe that I have a gap in understanding of the GP model. I thought the $60-$70 doesn't apply to GP subscribers. Can you clarify?

 

[clarky]

I'm really sorry I must have missed when you initially sent this. My main contention is with the bolded below:



Why is the Xbox player paying full price with GP? Someone else gave me a similar example which leads me to believe that I have a gap in understanding of the GP model. I thought the $60-$70 doesn't apply to GP subscribers. Can you clarify?

Where in that sentence does he mention gamepass?

Your regurgitating same same shit from the last page neither mention gamepass :

B) 100% of £70 + 100% of MTX sales, the chance of further spend on other titles, peripherals, gift cards & recurring subscription to either service for the lifetime of a console.

I'm assuming B) is GP strategy. If so, why are you including the $70 only applicable under product pricing?

 

[ChiefDada]

Where in that sentence does he mention gamepass?

Wait a sec, are you suggesting Microsoft is going to charge Xbox players full price for the next CoD AND make it exclusive? If yes, then this conversation isn't even worth my time and I will tell you without reservation that it will fail dramatically.

 

[clarky]

Wait a sec, are you suggesting Microsoft is going to charge Xbox players full price for the next CoD AND make it exclusive? If yes, then this conversation isn't even worth my time and I will tell you without reservation that it will fail dramatically.

Not at all.

COD will follow the same model as the rest of MS titles like Forza Horizon 5 for example. Again I'm not sure why you are being so obtuse.

 

[SteelCurtain 59]

I'm really sorry I must have missed when you initially sent this. My main contention is with the bolded below:



Why is the Xbox player paying full price with GP? Someone else gave me a similar example which leads me to believe that I have a gap in understanding of the GP model. I thought the $60-$70 doesn't apply to GP subscribers. Can you clarify?

That person is just buying Gold for multiplayer and COD. If they were to purchase Game Pass Ultimate (because they'd still need to play multiplayer) that would be $15/month or $180/year, which would mean even more money earned by the Xbox COD player as opposed to the $156 from buying COD and Gold every year. I just used the lowest amount because that would generally be the safer assumption.


EDIT: The person buying COD in this example doesn't have any Game Pass, if you have Game Pass you won't need to purchase COD at all, I just used the cheapest possible way somebody would be able to play COD multiplayer so as not to overstate any potential affects (i.e. most people that switch won't become Game Pass subscribers, as not even half of current Xbox userbase subscribes to Game Pass for some reason)

 

[Nobody_Important]

I am a lifelong Playstation player and even I find this thread to be weapons grade Copium. Holy hell. Just because Microsoft made a cutthroat move that cut Sony off at the knees does not mean you need to try and rationalize things into a neat little thing to make yourself feel better. Shit happens. Sony took a solid shot from Microsoft here. Now they have the chance to respond in kind with new investments into studios of their own to create new IPs to draw people in or they can turn that money into new acquisitions in order to seize IPs like MS has done.


It is okay to admit that the other side made a good business move (even if the move was bad for the industry as a whole) without trying to invent things in order to avoid acknowledging what they did.

 

[clarky]

That person is just buying Gold for multiplayer and COD. If they were to purchase Game Pass Ultimate (because they'd still need to play multiplayer) that would be $15/month or $180/year, which would mean even more money earned by the Xbox COD player as opposed to the $156 from buying COD and Gold every year. I just used the lowest amount because that would generally be the safer assumption.

He knows exactly what you are saying mate. Nobody can be this slow on the uptake, its been explained multiple times in this thread already.

 

[clarky]

I am a lifelong Playstation player and even I find this thread to be weapons grade Copium. Holy hell. Just because Microsoft made a cutthroat move that cut Sony off at the knees does not mean you need to try and rationalize things into a neat little thing to make yourself feel better. Shit happens. Sony took a solid shot from Microsoft here. Now they have the chance to respond in kind with new investments into studios of their own to create new IPs to draw people in or they can turn that money into new acquisitions in order to seize IPs like MS has done.


It is okay to admit that the other side made a good business move (even if the move was bad for the industry as a whole) without trying to invent things in order to avoid acknowledging what they did.

Stop it, no rational thought is allow around these parts.

Quoting for mods to see.

It take a lot less to cause confusion around here, but done lol.

 

[Nobody_Important]

Stop it, no rational thought is allow around these parts.

Quoting for mods to see.

I have edited the post a few times now. Can you change your quote to reflect it? I don't want people to be confused lol

 

[bender]

1. Build a new studio in Austin TX (Not second party)
2. Build a new studio in NY, NY (Not second party)

 

[clarky]

If I were in charge of Sony here is what I would do in 2022:

1. Build a new studio in Austin TX (Not second party)
2. Build a new studio in NY, NY (Not second party)
3. Add a second team alongside ASOBI
4. Beg Kojima and I mean BEG
5. Buy First Contact Entertainment and have them do a VR spin-off of SOCOM
6. Make sure you get a seat at the table with Devolver, CAPCOM, SEGA, Square, EA to block any future takeover.
7. Incubate an NFL game at San Diego under MLB. Try to get in that deal when it's up next year.
8. Aquire very specific IP and back catalog rights like Metal Gear, Silent Hill, Earthworm Jim, Persona.

Can't see there being any issues with crunch while your at the helm, I say go for it!

 

[ChiefDada]

That person is just buying Gold for multiplayer and COD. If they were to purchase Game Pass Ultimate (because they'd still need to play multiplayer) that would be $15/month or $180/year, which would mean even more money earned by the Xbox COD player as opposed to the $156 from buying COD and Gold every year. I just used the lowest amount because that would generally be the safer assumption.

Ok, I understand you now. The problem is you have to make a distinction between whether they are purchasing GPU or if they are purchasing CoD with additional gold membership and it is a critical distinction.

I don't think its a stretch to assume that Microsoft considers GP its main appeal for gamers to buy in to the ecosystem. Therefore, if the majority of hypothetical converts will access CoD via GP, then you can not attribute the entire $180 to CoD, as they are entitled to all of the game and services that Microsoft provides on GP, and they will certainly include a number of other blockbuster titles with presumably massive budgets.

Secondly, consider that Activision made company wide operating profits of $3bn last year by selling to both generations of PS and Xbox, an audience of nearly 200m consoles. There aren't enough PS players to make up that difference. And even if that impossibility became possible in an alternate reality, and they maintained that $3bn profit that Actiivision made last year, it would take over 20 years to break-even on their investment. I mentioned this in another threads somewhere.

Anyways, thanks for providing numbers for support and he great discussion. Again I sincerely apologies because much of the back and forth could have been avoided if I saw the reply with your stated assumptions.

He knows exactly what you are saying mate. Nobody can be this slow on the uptake, its been explained multiple times in this thread already.

Go to bed, clarky .

 

[clarky]

I think we should all meet back here in 5 years and see how this went down.

.
Go to bed, clarky .

Unfortunately stuck in work for another hour.

 

[MonarchJT]

Not to pick on you SteelCurtain 59 , but your paragraph above perfectly illustrates how financial topics in this thread are both misunderstood and erroneously applied.

You said they turned $70b into an asset, but then follow up with: "They didn't lose anything and there's nothing they need to recoup. Activision-Blizzard is still worth roughly 70 billion in Microsoft's eyes". In finance, value/worth is measured in currency. So since Microsoft spends $70b, they are in the red until profits are generated. This is a basic concept. You also say "there's nothing they need to recoup". Every financial investment is made with the intention to recoup/break-even and then make a profit either through income or subsequent sale. Again this is another basic concept that, without full grasp and understanding, makes it tough for discussions to progress in a substantive way.
,
Next, you say "As long as Activision gives a higher return than the amount that money would've gained in interest then Microsoft is happy with this acquisition". This isn't true. Microsoft could have also invested the money in one of their already existing internal studios, or they could have invested into one of their other business units outside of gaming, or they could invest in an index fund, etc. The opportunity cost is nowhere near limited to what they could earn from their bank account.

Finally, you say because this is Microsoft's 2nd largest acquisition, there is no opportunity cost. Again, this is wrong; as you pointed out, Microsoft was earning interest on that $70b that they use to purchase Activision. The interest that they could have continued to earn is literally the textbook definition of an opportunity cost.


All of the above is why we never get anywhere when discussing this topic. To be clear, I'm not denying the possibility that financial benefits exist for Microsoft in a scenario where CoD becomes exclusive, just that no one here has properly supported this position with a sound understanding and correct application of financial concepts.

in home finance work as you said
in high finance no. It work exactly as SteelCurtain 59 was explaining to you

 

[EDMIX]

I think we should all meet back here in 5 years and see how this went down.

Unfortunately stuck in work for another hour.

Thats actually a good idea.

I want to see how this all played out as I'm sure many might actually predict a winning strategy that was actually used.

 

[MonarchJT]

Notice how I never said that they were. Companies with investments that are in the red do not always need to post expenses on an income statement. An investment will be in the red until enough profits are generated to reach break-even. Your quote above along with the rest of your reply is plagued by a continuous misunderstanding of financial concepts.

no again doesn't work in that way

 

[Halo2redvsblue]

Stupid glitch

 

[NahaNago]

New IP yes for sure. I meant they don't need to buy publishers for their established IP.

See, this is where we diverge cause I think they do need to buy at least one publisher. Sony just lacks the nostalgic/historic ip that some of the other publishers have since they keep jumping to new ip every other generation.

 

[Halo2redvsblue]

This is Jim Ryan right now

 

[ChiefDada]

in home finance work as you said
in high finance no. It work exactly as SteelCurtain 59 was explaining to you

Home finance? Anyways as someone who has worked in finance and on M&A work for nearly a decade, I respectfully disagree.

 

[clarky]

See, this is where we diverge cause I think they do need to buy at least one publisher. Sony just lacks the nostalgic/historic ip that some of the other publishers have since they keep jumping to new ip every other generation.

Your joking right? They literally own around 200 IP's stretching back 30 years. How historic do you want? Maybe they could buy Pitfall off phil.

 

[NahaNago]

Your joking right? They literally own around 200 IP's stretching back 30 years how historic do you want? Maybe they could buy Pitfall off phil.

and how many of those ips do people mention when they have nostalgia for playstation? When talking about a playstation smash bros how many Sony characters would folks be hyped for? This is what I meant by jumping onto new ips all the time. They've failed to make their ip something to be nostalgic or hype for.

 

[ChiefDada]

no again doesn't work in that way

It does. Doesn't really matter what genre of finance we're talking about. That's how fundamental of a concept this is.

 

[clarky]

and how many of those ips do people mention when they have nostalgia for playstation? When talking about a playstation smash bros how many Sony characters would folks be hyped for? This is what I meant by jumping onto new ips all the time. They've failed to make their ip something to be nostalgic or hype for.

Just a few ive picked out quickly. "Sony just lacks the nostalgic/historic ip", can't get on board with that one.

Spoiler: Take your pick

• Destruction Derby
• DriveClub
• Everquest
• Everybody's Golf
• Gran Turismo
• God of War
• G-Police
• Gravity Rush
• Helldivers
• Heavy Rain
• Ico
• Infamous
• Jak and Daxter
• Journey
• Killzone
• Knack
• The Last Guardian
• The Last of Us
• Lemmings
• LittleBigPlanet
• PlanetSide
• MotorStorm
• MediEvil
• Q*bert
• Ratchet and Clank
• Shadow of the Colossus
• Sly Cooper
• SOCOM
• Syphon Filter
• Tearaway
• Uncharted
• Warhawk
• Wipeout

 

[PlaystationFan5349]

Let's look at the math here

Sony purchases a smaller dev Insomniac for $229 million who have talent but little known IP

They now have a consistent 20 million selling IP in Spiderman

If for some crazy set of circumstances Capcom wanted to sell and Sony bought them it would cost them 5 billion dollars, and they only have a couple 10 million (at best) selling franchises that are less impressive even because they're multiplats.


MS's never ending pockets can afford them to make ridiculous purchases like 70 billion for COD.

A strategy that may be good for one is not good for the other.

Nintendo is breaking sales records for Switch with first party studios alone and a lot of those games are pretty low budget to make.

Playstation's brand value and development talent is what's going to see them through because all their first party franchises are starting to put up the big numbers

GOT 8 million
Horizon well over 10 million
GOW 20 million plus
Spiderman 20 million plus

This guys says “think about it” and then proceeds to type a 2 paragraph reasoning that everyone else has discussed.

 

[clarky]

It does. Doesn't really matter what genre of finance we're talking about. That's how fundamental of a concept this is.

I'm no finance expert like yourself, maybe that's where I'm going wrong. Although things seem to be going a-ok so far.

When I look for an investment for my portfolio, I factor in 2 things ROI and growth. Not how fast can I get back the money I just spent. Again maybe it works differently in M&A or I'm doing it wrong.

Got any tips or reading i can do? wheres the smart money at right now do you think?

 

[coffinbirth]

New IP yes for sure. I meant they don't need to buy publishers for their established IP.

Well, they are in desperate need of studios to make said IP...and scooping up a publisher is a good way to achieve that.

 

[NahaNago]

Just a few ive picked out quickly. "Sony just lacks the nostalgic/historic ip", can't get on board with that one.

Spoiler: Take your pick

• Destruction Derby
• DriveClub
• Everquest
• Everybody's Golf
• Gran Turismo
• God of War
• G-Police
• Gravity Rush
• Helldivers
• Heavy Rain
• Ico
• Infamous
• Jak and Daxter
• Journey
• Killzone
• Knack
• The Last Guardian
• The Last of Us
• Lemmings
• LittleBigPlanet
• PlanetSide
• MotorStorm
• MediEvil
• Q*bert
• Ratchet and Clank
• Shadow of the Colossus
• Sly Cooper
• SOCOM
• Syphon Filter
• Tearaway
• Uncharted
• Warhawk
• Wipeout

We are looking at this from a different point of view. Many of those are solid and even great ips ( I've bought games in half of these series)but they all lack that wow factor that those third party publishers games have. This has always been Sony's style to not rely on one or two ip.This is why the Bethesda and Blizz/acti purchase was so amazing. You have given me somthing to mull over. Although Sony doesn't have the historic/iconic ip that the other studios have they do have a ton of ip that they could use. I still think a playstation smash bros would be terrible.

Now in defense of Sony they have been doing better at handling their IP. The god of war has gotten bigger, Ratchet and Clank is getting bigger, and Uncharted was a powerhouse. They just need to keep on promoting/ developing games in those series. Maybe in a couple of years they will be as mainstream as halo, sega, mario, street fighter, cod, and have shirts and toys in a bunch of stores.

Does Sony still own everquest?

 

[Leyasu]

You have not. Most of you here who are convinced Microsoft will make CoD exclusive have tried to paint such a scenario as financially viable using nothing more than unchecked optimism to support your views.

Nobody knows for sure and won’t until the deal is done.

Most of you here are convinced that Microsoft will keep cod multiplatform have tried to paint it as the only scenario which is financially viable using unchecked optimism to support your views.

We can both do this

 

[THE DUCK]

The original post doesn't really make sense, buying a small but talented 3rd party developer won't get you big franchise names like Elder Scrolls, Doom, Call of Duty, etc. So no, it's not the "better strategy". Could it be helpful? Yes? Have all big console makers done this for forever? Yes.

I mean can you really say ms would have been better off just buying a few smaller developers at this point? The answer is no.

 

[EDMIX]

Just a few ive picked out quickly. "Sony just lacks the nostalgic/historic ip", can't get on board with that one.

Spoiler: Take your pick

• Destruction Derby
• DriveClub
• Everquest
• Everybody's Golf
• Gran Turismo
• God of War
• G-Police
• Gravity Rush
• Helldivers
• Heavy Rain
• Ico
• Infamous
• Jak and Daxter
• Journey
• Killzone
• Knack
• The Last Guardian
• The Last of Us
• Lemmings
• LittleBigPlanet
• PlanetSide
• MotorStorm
• MediEvil
• Q*bert
• Ratchet and Clank
• Shadow of the Colossus
• Sly Cooper
• SOCOM
• Syphon Filter
• Tearaway
• Uncharted
• Warhawk
• Wipeout

Saved me a post lol

I generally hate that myth too. Sony focusing on new IP every generation is why they move record units. I don't see any reason for them to just keep putting out the same fucking IP all the time because Nintendo does, idgaf, what is good for them doesn't mean its good for Sony.

Where the fuck was that help when Wii U flopped? You still need new consumers and I think Sony has the best strategy as to why even MS has moved on from trying to force some evergreen concept ala Halo Gear Forza etc, they tried that annnnnnnd XONE flopped. Its clear they need new IP and going forward new concepts is what MS is pushing now, not just "here is the same fucking shit once per gen for FEELZ", that shit doesn't work out ALL THE TIME for all publishers, even Nintendo themselves. So this idea that Sony needs this iconic or nostalgic concept imho is nonsense as Kratos and Ellie and Joel may not be as known as Mario or something, never stopped them from fucking moving 20 million units either and being known and loved by that PS community. I see no evidence that this forced 1 IP a gen for life shit actually is the way to go, even for the very publisher that even supports that idea.

New IP every gen is why Sony has a whole base of new consumers who are Horizon Zero Dawn fans, Ghost Of Tsushima fans, Death Stranding fans etc, let new iconic heroes come to life to pave the way for new consumers. Not everything needs to be God Of War, Ratchet and Little Big Planet for life.

Using such shit logic, we never get Uncharted, Dreams, Astro Bot and so much more, so I'm 100% on board new IP every gen. I don't see any logical reason to hold back new ideas to force this "iconic" concept when they already have a stable of that shit anyway.

They are the only first party publisher that literally doesn't need to do anything different then what they did last gen.

New IP, some established IP......profit lol Their set up as far as i'm concerned should be fucking standard for lots of publishers, idgaf I'm tried of seeing the same shit every gen by some publishers, EA could have used that Sony strategy as imho, its doing wonders for Ubisoft right now who broke many records bringing up many new ip last gen.

The Division, Watchdogs, Fenix Rising and some established like AC, Far Cry etc.

 

[clarky]

We are looking at this from a different point of view. *snip*

Yeah we are going to have to agree to disagree on this one. In fact my tastes are the complete opposite of yours but thats cool obviously. personally Activision's back catalogue is mostly dumpster fire. i enjoy the more recent stuff a bit more though.

if you compare AT/B current and back catalogue together to Sony's id say sony has the edge by a fair bit. Although again a lot of what they put out isnt to my taste.
Bethesda stuff though, that is my bag .

The fact that i just said that makes you realise how big a purchase this actually is. lol.

Going off topic here though crack on

 

[NahaNago]

Just a few ive picked out quickly. "Sony just lacks the nostalgic/historic ip", can't get on board with that one.

Spoiler: Take your pick

• Destruction Derby
• DriveClub
• Everquest
• Everybody's Golf
• Gran Turismo
• God of War
• G-Police
• Gravity Rush
• Helldivers
• Heavy Rain
• Ico
• Infamous
• Jak and Daxter
• Journey
• Killzone
• Knack
• The Last Guardian
• The Last of Us
• Lemmings
• LittleBigPlanet
• PlanetSide
• MotorStorm
• MediEvil
• Q*bert
• Ratchet and Clank
• Shadow of the Colossus
• Sly Cooper
• SOCOM
• Syphon Filter
• Tearaway
• Uncharted
• Warhawk
• Wipeout

I failed to actually respond to your nostalgic/historic ip reply in my last response. Very few of those are what I would call historic. Like I'd say,gt, everquest if they still own ip, qbert, lemmings, socom, and everybody's golf. Plus if the game started out originally on ps3 I'd barely count a game as nostalgic since that isn't that still isnt' that long ago.

Yeah we are going to have to agree to disagree on this one. In fact my tastes are the complete opposite of yours but thats cool obviously. personally Activision's back catalogue is mostly dumpster fire. i enjoy the more recent stuff a bit more though.

if you compare AT/B current and back catalogue together to Sony's id say sony has the edge by a fair bit. Although again a lot of what they put out isnt to my taste.
Bethesda stuff though, that is my bag .

The fact that i just said that makes you realise how big a purchase this actually is. lol.

Going off topic here though crack on

Those games aren't to my taste as well honestly. Never played cod and the last blizz game I played was warcraft 3 and starcraft (2). I think I've played like 3 Bethesda games. But those ips are still massive.

If were comparing back catalogue I'd still say that Sony doesn't really have the highs that acti/blizz had in the past. They had solid games don't get me wrong. They really blew up during the ps4.

 

[clarky]

StarCraft was fucking great, Be nice if we see something done with that. Although prob not an RTS, keeping those fans happy would be a tougher job than 343's lol

 

[ChiefDada]

I'm no finance expert like yourself, maybe that's where I'm going wrong. Although things seem to be going a-ok so far.

When I look for an investment for my portfolio, I factor in 2 things ROI and growth. Not how fast can I get back the money I just spent. Again maybe it works differently in M&A or I'm doing it wrong.

There is an inherent time component when determining ROI though. But anyways done for the night it's been fun chatting with you and everyone else about this and it'll be interesting to see how this turns out. Hop you're able to get off work soon.

 

[EDMIX]

I failed to actually respond to your nostalgic/historic ip reply in my last response. Very few of those are what I would call historic. Like I'd say,gt, everquest if they still own ip, qbert, lemmings, socom, and everybody's golf. Plus if the game started out originally on ps3 I'd barely count a game as nostalgic since that isn't that still isnt' that long ago.

Those games aren't to my taste as well honestly. Never played cod and the last blizz game I played was warcraft 3 and starcraft (2). I think I've played like 3 Bethesda games. But those ips are still massive.

If were comparing back catalogue I'd still say that Sony doesn't really have the highs that acti/blizz had in the past. They had solid games don't get me wrong. They really blew up during the ps4.

Thats just you then, this is a matter of opinion and I believe you are confusing "nostalgia" with relevancy. As in, you can go to anyone on the street and show them Pac Man vs Kratos and I agree with you that most will know who Pac Man is vs Kratoes....

Pac Man moving 20 million units if it released as a full price game today based on that? In business we call this "what have you done for me lately" its where we judge and factor RELEVANCE in TODAYS MARKET and not what you fucking did in the past or how "historic" that might seem, its irrelevant to the modern market and you are going more so off of feelings, emotional response and pop culture concepts, that doesn't mean any of that shit is relevant.

Star Fox.

I agree with you that such a character is wildly known and even the phrases from the N64 version being legendary.....how the fuck did that do for them lately sir?

Star Fox Zero sales off to a series-worst in Japan

Nintendo’s head’s in the McClouds I am legitimately unsure why Nintendo feels like Star Fox should get a nod over...

www.destructoid.com

I mean hey, we KNOW who he is right? Look how POPLULAR he is right? That means....what now? Do you not see how such a thing may not mean what you think when you factor in the modern market vs "nostalgia"?

I'm going to say something that was told to me by another small business owner regarding branding and marketing "just because they recognize you or you have their attention, doesn't mean you have their respect" KNOWING of a IP historically is meaningless and irrelevant and boils down to an immature popularity contest if the IP has been so abused, milked and outsourced that its caused it to tank in sales. 1 part of the market sees it as "oh yea I remember that as a kid, kool...i don't game anymore doe" and 1 part of core gamers see it as "oh yea that was kool, the IP is fucking shit now I remember those flops too" thus knowing of Star Fox as a mass market thing is irrelevant if THOSE THAT MATTER who BUY GAMES see that IP as a failure, flop, avoid at all cost etc

Its why it made sense not to put out Jak 4. They don't have any ideas, let them move on to Uncharted and The Last Of Us, both games broke records for Sony, both games 15 years later are now seen as "iconic" no matter how you slice that. Why pimp out Jak and Daxter with no ideas, force the team to put out shit JUST to say 'derrr day iconic, look how much EVERYONE knows who they are"


Annnnd how do you know they'll know them for something positive sir? =)

Give us Jak 4 when Naughty Dog has a real direction for it and let them move on. Sony is seeking to be known for quality games, they are not seeking to be know solely based on characters alone, quality and ideas be damned. Soon, those characters will be synonymous with bad qualtiy if they do that ie Star Fox, Medal Of Honor and many flop IPs.

and how many of those ips do people mention when they have nostalgia for playstation?

Lots of people bring up those IP btw, we literally have another thread going of people asking for tons of those IP, so clearly people have fond memories of em.

Sony doesn't have the historic/iconic ip that the other studios have

I disagree.

I'd argue all the fucking publishers we just talked about have a stable of historic and um "derrr iconic" IP lol

Look at Konami. They are sitting on some gaming history with their IPs and whats that doing for them lately sir?

So I stand by that Sony made a wise choice to always make new IP, as that never meant stop putting out established classic IP from time to time, they were able to have both tbh. Killzone from PS2-PS4, Ratchet from PS2-PS5, GT from PS1-PS5, none of that stopped Horizon, Spiderman, Resistance, Driveclub, Motorstorm etc. They had both. They literally put out new, supported established, they'll live with a 80 year old geezer not knowing who Kratoes is, I'm sure Sony is crying all the way to the bank with that 20 million units sold about that or something lol

 

[captainraincoat]

So what stage of denial are we officially in now?

I thought we got to the testing stage but it’s pretty clear we are back at bargaining

 

[TheThreadsThatBindUs]

You cited the top selling CoD as 70 million, without thinking about the fact that there were about EIGHT CoD releases last gen, haha. Unless, of course...you think all the same people bought all of those games, looool.

Why not try actually reading posts to be able to follow the conversation?

WTF are you on about...?

 

[clarky]

There is an inherent time component when determining ROI though. But anyways done for the night it's been fun chatting with you and everyone else about this and it'll be interesting to see how this turns out. Hop you're able to get off work soon.

Im sorry, but pretty sure you bought a financial book on tuesday and your just spouting nonsense.. Im not an expert but i have a basic knowledge of the fundamentals of investing.

Your full of shit.

it has been fun thread again, ill be back to tomorrow if you fancy doing this again.

 

[NahaNago]

Saved me a post lol

I generally hate that myth too. Sony focusing on new IP every generation is why they move record units. I don't see any reason for them to just keep putting out the same fucking IP all the time because Nintendo does, idgaf, what is good for them doesn't mean its good for Sony.

Where the fuck was that help when Wii U flopped? You still need new consumers and I think Sony has the best strategy as to why even MS has moved on from trying to force some evergreen concept ala Halo Gear Forza etc, they tried that annnnnnnd XONE flopped. Its clear they need new IP and going forward new concepts is what MS is pushing now, not just "here is the same fucking shit once per gen for FEELZ", that shit doesn't work out ALL THE TIME for all publishers, even Nintendo themselves. So this idea that Sony needs this iconic or nostalgic concept imho is nonsense as Kratos and Ellie and Joel may not be as known as Mario or something, never stopped them from fucking moving 20 million units either and being known and loved by that PS community. I see no evidence that this forced 1 IP a gen for life shit actually is the way to go, even for the very publisher that even supports that idea.

New IP every gen is why Sony has a whole base of new consumers who are Horizon Zero Dawn fans, Ghost Of Tsushima fans, Death Stranding fans etc, let new iconic heroes come to life to pave the way for new consumers. Not everything needs to be God Of War, Ratchet and Little Big Planet for life.

Using such shit logic, we never get Uncharted, Dreams, Astro Bot and so much more, so I'm 100% on board new IP every gen. I don't see any logical reason to hold back new ideas to force this "iconic" concept when they already have a stable of that shit anyway.

They are the only first party publisher that literally doesn't need to do anything different then what they did last gen.

New IP, some established IP......profit lol Their set up as far as i'm concerned should be fucking standard for lots of publishers, idgaf I'm tried of seeing the same shit every gen by some publishers, EA could have used that Sony strategy as imho, its doing wonders for Ubisoft right now who broke many records bringing up many new ip last gen.

The Division, Watchdogs, Fenix Rising and some established like AC, Far Cry etc.

It isn't just Nintendo that does it though. It is nearly all of the major third party publishers who do the same and xbox. Sony was able to crank out some stellar games last gen for sure but they have mostly been recognized as having several studio powerhouses mostly during the ps4 era versus only Naughty Dog being on every ones lips during the ps3 and a bit of Santa Monica. They pretty much nearly went the Nintendo/Xbox route during the ps4 and focused on making what seems fewer but bigger games unlike what they did during the ps3 era where they were making or funding everything under the sun. New ips are great for creating new fans but it is the older games that bring folks to usually buy a new console.

Sure the wii u was a flop but the switch is now selling like crazy from those same ips or the same games that they originally sold on the wii u but with a few tweaks. xbox one still sold like what 60 million consoles on just halo, forza, and gears and would have sold a lot more if not for that incredibly terrible launch.


On your other post. Most of what your talked about is what if you abuse or misuse your ip and it fails to do well but as we can see from lots of other third party publishers if you treat it well it can sell millions of copies, just look at Doom or even the new final fantasy 7 game I don't like.

Why the hate on pacman? I'm pretty sure they are still selling little nostalgia arcade machines with pacman on it and they created a pacman show a couple of years ago. Their are so few games that even move 20 million units today.

So they failed with star fox but how many weeks did mario kart chart on the npd.

Kratos, gt, and ratchet are ip that Sony is doing great with and hope have continued support for the ps6 and beyond. I don't mind Sony making new IP all the time just make sure not abandon the older ip when you go after something new. I still want a new Jak and Daxter game!

 

[Shut0wen]

Wait, so does that mean everything else like Halo isn't making money either?

Sony releasing those games on PC but still not giving you the likes of Bloodborne should tell you Horizon and GoW are not on PC due to not making much money and trying to make a buck but because they are releasing sequels on PS5.

Sony know by releasing bloodbourne on pc they will make a killing, potentially selling over 2million and it hasnt beem done because A) the remake rumours could be true b) sony actually dont see the potential, and yes halo hasnt really made a killing since reach, masterchief collection was the highest grossing halo game since reach so yes halo was struggling as well, everyone is catching on that pc player base is growing incredibly stable and what your saying could be true but i wouldnt be surprised if GOW2 and horizon 2 come to pc 3 years from now and if it does then yeah development cost is way to high for it to be registered to one console unless your nintendo

 

[EDMIX]

It is nearly all of the major third party publishers who do the same and xbox.

Not actually true, in fact less do this as they still need new consumers.

XS literally failed a generation doing that combo and is now focusing on new IP, so so much for this "do the same" that simply isn't true and MS direction is to literally avoid what just happened with XONE.

they have mostly been recognized as having several studio powerhouses

Cause their focus is on the talent and quality of what those studios put out, not solely trying to fucking milk 1 IP to death. As to why Jak 4 was not done, they don't have any ideas, let Naughty Dog move on, thus they are KNOWN for the talent of the studio, not the studio solely known for 1 IP, let the focus be one what that studio can create instead of trying to force this fake evergreen thing from all IPs trying to milk them to oblivion.

They pretty much nearly went the Nintendo/Xbox route during the ps4 and focused on making what seems fewer but bigger games

Thats also false btw.

https://en.wikipedia.org/wiki/List_of_Sony_Interactive_Entertainment_video_games#PlayStation_4

unlike what they did during the ps3 era where they were making or funding everything under the sun.

Yea...thats completely false, you literally have links to show you that to be false. You want to talk about how you feel it LOOKED, you don't want to prove such a point with real factual data.

New ips are great for creating new fans but it is the older games that bring folks to usually buy a new console.

Yea they broke those records because they did both.

God Of War, GT, Ratchet, LBP, SoTC remake and may more for established fans.
Horizon, Days Gone, Death Stranding, Ghost Of Tsushima, Dreams etc to bring in new consumers.

I don't know where this idea has come from that Sony..ONLY DID NEW IP and stopped making anything else and stopped um " funding everything under the sun" in favor of new IP.

That is false.

We got New IP, we got established IP, we got smaller titles too.

Sure the wii u was a flop but

Nah, it was a flop, not but. The topic of Wii U proves the point and I see no reason to goal post that a portable system's REAL reason for selling was those IP

The same fucking IP btw that literally exist ON THE FAILED Wii U, dear god, that fucking point might support what I'm saying even MORE! Its literally showing you that 2 systems got BoTW, Mario Kart, Smash Bros etc yet 1 failed and 1 succeeded.

I have a hard time believe the factor that changed that was really those IP and not it being portable and Japan favoring portable........ even when Smash Bros released on Wii U and 3DS, it sold MORE on 3DS, as in...nothing is wrong with IP, something is wrong with how the view the IP on that system, as in the IP ALONE couldn't not move Wii Us, as in the best IP on earth, doesn't mean people will buy NGage doesn't fucking mean they'll play the game on a Nokia brick....then when it suddenly comes out on a actual good system and moves units, sir...don't pretend the IP alone was based on those sales, its a mixture of a failed platform and people desiring to play it on a different system ie portable.

Wii U is literally proof that IP ALONE could not sell that system if the very same IP broke records on Switch. No kidding lol Notice how great they did ELSE where, does that not tell you clearly nothing was wrong with the game, but people simply didn't like the IP ENOUGHT to buy a crap dated limited system? So I don't really buy that you can just copy and paste that shit and everyone will disregard all flaws.

Wii was a massive success... Wii U proves even with the damn Wii IN ITS NAME, that you can't sell solely on that idea alone and nothing more.

This proves that its a combination of something, Wii unique way to play added with those IP is what got those sales, Wii U flops as it can't live off of JUST IP recongiztion alone, Switch does will based on being portable WITH those established games, to the point of even Wii U ports moving more units, as in the games were never the issue, thus its a combo of relevant hardware, solid control scheme, IP.

Why the hate on pacman?

I'm not hating on Pacman, I'm simply making a point showing you the difference from modern relevance to pop culture nostalgia.

So they failed with star fox but

Nah no but, stop goal posting lol The post is as logical as it gets. KNOWING the IP, is not enough and how relevant it is to core consumers is more important then how its seen by a mass of people based on pop culture. You may remember Star Fox fondly, doesn't mean gamers TODAY as of RIGHT NOW (adjust cap locks lol) really care about that IP, they don't care because the quality is so bad now, its known for being bad by gamers, doesn't matter that they know it from their childhood, the know it to be shit as a series as adults based on its recent milking.

Thus, the importance is not milking the IP to death, its in solely putting out quality titles so that way gamers who actually buy games, value the quality, not simply know its image. Knowing the face of a character means nothing when it becomes synonymous with bad, copy and paste, milked outsourced games.

The quality first should be factored before making a sequel, not the forced image solely to market a character.

just make sure not abandon the older ip

Nah, I greatly disagree. If that shit was bad, keep it dead and only return if and only IF the studio has a great idea for it.

That whole "make sure not to abandon" is why we have Star Fox flopping. They never needed to milk that IP to such a degree and maybe we are better off with what we got until they make something actually good, now the IP has flopped so many times, we don't even know if they'd listen to a pitch for Star Fox 64-2 type deal, they might feel people hate it or something based on those low sales, I don't want that happening to any Sony titles, especially my favorite.

I still want a new Jak and Daxter game!

I like Jak and Daxter too, but I respect the freedom given to Naughty Dog for them to move on and only return when they have an idea vs outsource and milk.

I'd rather have a proper Jak 4 thats a great ass idea, if it needs to stay gone til then, so be it. We got endless Star Fox after Star Fox and all it did was kill that IP, maybe it should only be made if they have a great idea and its of great quality, whats the point of being remembered if its also remembered for being bad? Why make a sequel solely for relevance and not quality? I don't see that as a great thing for consumers, even if you like those IP, i'm sure you also like those IP being good too lol

Have a good one.