The concept is called "inflation". It's not that difficult to understand. Tomorrow your money is worth less than today. To maximize value you acquire assets which will increase in value over time instead of the cash losing value due to inflation.
Microsoft acquired Activision Blizzard King for $69 Billion on 2023-10-13
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Sony bought Q*Bert and it's disappeared from every console. This might sound like some sort of joke, but in this age where retro gaming is more popular than ever, Q*Bert has no presence on a retro collection, or any of the modern cartridge re-releases (Like Wiley Wars, Joe and Mac, and Super Double Dragon have received on Genesis and SNES), nor on a retro platform like Evercade. Not even on PS4 or 5. Universal foreclosure.
This is a good analogy when comparing the subscription model of Gamepass and how Activision being owned by Microsoft would affect competitors subscription services. Sony's purchase of Insomniac effectively removes them from making games for VR platforms that aren't PSVR.
There is also this thing called depreciation and running expenses when you buy a company's assets. Plus money get deposit interest or can be invested in bonds and low risk securities or real estate.
Ask yourself why and how banks pay interest on deposits and you may come to understand why it is not the best place for your money.
In other words if shareholders wanted to make 1% they would just put their money in the bank themselves not wait for MS to do it for them.
Somebody must of forgotten to tell Sony about this then.
Q*bert REBOOTED: The XBOX One @!#?@! Edition
Anybody want to buy it? Just 10 bucks.
Q*bert REBOOTED: The XBOX One @!#?@! Edition
As for Insomniac, they were a Sony affiliated studio for almost 18 years (1996 -2014) and worked directly with Sony for most of that. If Microsoft valued them they should of got the check book out back in 2016.
Huh, can't believe I missed that coming out. I mean, I knew Q*Bert Rebooted exists, but I thought it only came out on mobile devices and Steam. It's available on PS4 also, but not by itself apparently, as it requires you buy it in a bundle with DLC or another game.
Ignoring the parts you omitted about depreciation and expenses involving assets and other means of investment. The $60billion investment in Activision is part of a very very long term strategy and not an investment with yearly returns such as when investing in real estate. It will take a very long time to start giving any returns to shareholders. Those assets dont guarantee return, involves higher risk due to the size of the investment and reduce liquidity (which guarantees big dividend payments). It was not an investment on assets because they didnt know where to put that money to get returns. It was a conscious investment on MS's existing businesses and securing or expanding dominance in the transforming market in the long term. Thats why shareholders agreed to it because it communicates MS's ability and commitment to remain strong, relevant and growing.
You must be really bad at math.
It's not a used car, it's a profitable global corporation.
You just explained the difference between buying assets and investing in business. Thank you for agreeing
So you're admitting you are wrong? Glad we cleared that up.
You are admitting your lack of comprehension abilities and you are arguing for the sake of arguing.
Just checked MS's and ABK's liquidity ratios. I dont know how they are handling the acquisition. I suppose it will be a combination of current asset funding and share exchange, not through loans. I dont think it is going to leave a dent at MS's operations and obligations. ABK's liquidity is pretty high. But the purchase is quite staggering even by MS's standards. MS's current assets are close to $161 billion with liabilities around $80 billion. They have a lot of power to invest larger with proportionately less risk involved due to their size.
Sony's liquidity ratio on the other hand is very low. Any purchase they are making is expected to have a bigger financial pressure in meeting their obligations.
Sony's liquidity ratio on the other hand is very low. Any purchase they are making is expected to have a bigger financial pressure in meeting their obligations.
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Sitting on a pile of money is definitely not sensible. But there are lots of options available, including better dividends for shareholders, stock buyback, better wages and benefits for staff. Reckless spending, because this borderline is, with no clear path to RoI that isn't measured in decades shows no imaginational all. And I really do worry for this acquisition. Microsoft have acquired - then dumped - a scary amount of companies in the past.
I don't care at all about Activision, but Blizzard..
There’s a larger play here at work than just games. We just need to wait to see it play out.Sitting on a pile of money is definitely not sensible. But there are lots of options available, including better dividends for shareholders, stock buyback, better wages and benefits for staff. Reckless spending, because this borderline is, with no clear path to RoI that isn't measured in decades shows no imaginational all. And I really do worry for this acquisition. Microsoft have acquired - then dumped - a scary amount of companies in the past.
I don't care at all about Activision, but Blizzard..
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Yes. That is what the CMA and EU regulators are concerned about. Videogame consoles are the least of it. It's kind of exhausting to keep posting it to have it ignored.
Reuters said:
Yes but that market doesn’t exist. We’ve gone through this. You can’t monopolize this future market with cod.
This market needs technology.
CMA and EU regulators aren't focusing only on COD and aren't suggesting that MS will become a monopoly overnight. They can have negative effects on the market even if they don't become one. They are focusing on the merger/acquisition as a whole with COD being one of the pieces of the puzzle.
According to CMA, based on their observations after the acquisition of Zenimax, they are suspicious of MS's intend for unfair competitive advantage practices. Thats one of the reasons why they mention, that they aren't convinced they won't make COD exclusive. But Consoles are just one piece of the whole market they are investigating.
Also the spending of $68 billion worth of acquisition is enough to create suspicion to investigate further the "why's" and whats in really for it for MS future plans. Because such a huge investment should also be expecting huge amounts of advantages. Besides MS has multiple times suggested in the past during their acquisition spree that they are building a studio portfolio to bring exclusive content to their XBOX ecosystem. Which of course the CMA and EU regulators had no issue with their smaller purchases. But they are now potentially owning a huge amount of popular multiplatform franchises across multiple digital entertainment markets, including PC, Mobile, and Consoles.
Allowing such a merger if anything can go south, is like opening Pandora's box for the regulators.
PS I dont know what you mean by "this market needs technology". Would you elaborate
Based on the CMA's response there are only looking at 3 things, anything outside of this is out of bounds for their investigation.
1. What could be the impact of the merger on gaming consoles and subscription services?
2. What could be the impact of the merger on cloud gaming services?
Anything to do with OS and Azure have only to do with how well MS can support cloud services. It is not about blocking this merger from MS growing in other areas. If this is the case, all corporations are doomed to any type of expansion.
For 1: https://www.vgchartz.com/article/45...r-about-15-of-xbox-revenue-says-phil-spencer/
"Game Pass as an overall part of our content and services revenue is probably 15 percent I don’t think it gets bigger than that," he said. "I think the overall revenue grows so 15 percent of a bigger number, but we don’t have this future where I think 50–70 percent of our revenue comes from subscriptions."
So there is a limit to how high gamepass will go, and Phil states in this interview that the console game pass market is already saturated. That's why there is a bigger focus on PC game pass now, until they saturate that, they they need to focus on mobile... which.... requires... CLOUD.
Second point for 1: is Sony. CMA cites the marketleader and MS biggest rival in the console space. One would have to prove that Sony would foreclose as a result of this merger. This is unlikely.
For 2. Cloud gaming services. The winner of this space will not be won by content, but by the company that owns the technology that is able to stream fast enough to replace traditional hardware.
As per CMA comments here:
In the longer term, many market participants expect cloud gaming to grow and for gamers to shift from console gaming to cloud gaming on a range of devices. This market is growing rapidly and has seen several new entrants that were previously not active in console gaming, including cloud platform providers, such as Google and Amazon, and game developers such as Ubisoft.
The bolded will only come true if cloud gaming hardware can supplant traditional console hardware. There is no guarantee of this. And the merger of ABK would have no effect on how hardware progresses.
Cloud gaming services will be forever minimal until this particular problem is solved.
Where did I say CMA is concerned about MS growing in other areas? Thats not what I said. The regulars are not concerned with growth.
They are concerned with unfair advantages and market controls. By no means is a company growing to other markets considered a problem by itself by the regulators.
Sorry, sometimes it's hard to separate which markets are being discussed when a lot of things are just thrown in as a generic statement. I made some assumptions.
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