Rumour confirmed: Microsoft Purchase Minecraft for $2.5B (Post#122)

[-tkf-]

Except there are plenty of minecraft users that haven't indulge in the type of value that mods add.

My 6 year old son loves Minecraft and part of that love involves watching about the mods on Youtube (I am forced to watch it with him because I have to cull through the ones with bad language). But he can't participate.

Updating the graphics, new gameplay features, incorporating some of features of the most loved mods and/or tools that makes it easier for the masses to participate in what minecraft is all about is worth a Minecraft 2 label.

I do think it would be a bad ideal for MS to lock MC behind Windows and the Xbox. Its not like they have to do so. It might be a better play to lock it behind their cloud platform versus their hardware. Universal and portable saves that migrate to any platform would seem to better serve their best interest as well as MC fans.

One Minecraft for multiple platforms would be a good way to endear fans. I haven't checked lately but my son says MC on the 360, iOS and PC aren't the same game as features are platform dependent.

I use this setting for my son, it helpst a bit: https://support.google.com/youtube/answer/174084?hl=en

My son looks at YT as well, sometimes he plays Minecraft and his father has to spend time off work, doing work getting the mods to work

Imho, Notch has not in anyway milked Minecraft the way it could have been done, not that MS would do that, but imho, there is plenty of unexplored ways to get more money from Minecraft.

What i just don't get is, that Notch has so much money now, and since he so far has avoided the "money hats" of low hanging fruits i simply don't understand what has changed.

 

[Shifty Geezer]

Seeing as how Minecraft is like the gateway drug to video games for many kids these days, they probably want to get in on that mind share for the younger demographic and hope they follow them into the next generation.

That's an interesting take and justification.

 

[Shifty Geezer]

What i just don't get is, that Notch has so much money now, and since he so far has avoided the "money hats" of low hanging fruits i simply don't understand what has changed.

Maybe he'll give it all to charity, or start up some super tech company building lifts (elevators) to the moon? Or buy a volcanic island and create an evil lair?

 

[dobwal]

I use this setting for my son, it helpst a bit: https://support.google.com/youtube/answer/174084?hl=en

Ohh. Thank you a million times. Don't know why it didn't occur to me to look at the YT settings. I usually go with the Ipad settings which basically locks out YT and then use myself as a human filter. A typical session involves my son's eyes glued to the ipad in a hypnotize state only to be intermittently disturb by me with the question, "How are you entertained by this". He always retort, "Dad, everybody loves Minecraft!!!".

My son looks at YT as well, sometimes he plays Minecraft and his father has to spend time off work, doing work getting the mods to work

I've made a concerted effort to like Minecraft but to no avail. Luckily my son hasn't ask me to help him mod, even though he has queried me on how it is done.

Imho, Notch has not in anyway milked Minecraft the way it could have been done, not that MS would do that, but imho, there is plenty of unexplored ways to get more money from Minecraft.

What i just don't get is, that Notch has so much money now, and since he so far has avoided the "money hats" of low hanging fruits i simply don't understand what has changed.

I don't think MS necessarily needs to do anything extra to milk MC. It generated 330 million in revenue (40% increase from the previous year) and $130 million in profit last year. There is a concern of how long MC remains viable. Its not like there aren't others looking to take on MC and its biggest vunerability seems to be its graphics. Its not 2009 anymore and most low end hardware available now can handle more demanding visuals. MS simply providing the resources and capital investment to help for a efficient delivery of MC2 might be all Mojang needs to keep MC relevant and the revenue growing for the next 5-10 years.

 

[MrFox]

It's a huge draw for kids. My 7 years old nephew really loves minecraft. He's in his "spaceship" phase with legos and extending his creativity with minecraft. With some supervision he was playing Portal and Ratchet and Clank long before minecraft so the "gateway" happened in reverse order... I think the best gateway to videogames remains phone/tablet.

The idea of moving minecraft to a modern engine and use microsoft cloud could be a better explanation for this deal. If they move to something similar to the VoxelFarm middleware they can do everything server side as long as they stay at a reasonable complexity level. It would fit with the "cloud first" vision, and Nadella would be happy.

 

[Shifty Geezer]

The idea of moving minecraft to a modern engine and use microsoft cloud could be a better explanation for this deal. If they move to something similar to the VoxelFarm middleware they can do everything server side as long as they stay at a reasonable complexity level. It would fit with the "cloud first" vision, and Nadella would be happy.

They made something of the order $100 million profit last year. At that rate, it'd take 20 years to cover the investment. Factor in some growth so more money in ongoing years (or greatly reduced revenue if it becomes platform exclusive!), and then some downturn as people move on to something new, is it really worth 2 billion? MS wanting to buy Mojang I could understand, but the asking price seems a bit crazy as an investment. I'm not sure what the gameplan for returns would be.

 

[MrFox]

Okay, yeah. The amount is insane.

Do they have any patents?

 

[dobwal]

They made something of the order $100 million profit last year. At that rate, it'd take 20 years to cover the investment. Factor in some growth so more money in ongoing years (or greatly reduced revenue if it becomes platform exclusive!), and then some downturn as people move on to something new, is it really worth 2 billion? MS wanting to buy Mojang I could understand, but the asking price seems a bit crazy as an investment. I'm not sure what the gameplan for returns would be.

ATT spent 48 billion on a company that generates just under 3 billion in profits annually. Easy slam dunk investments are hard to come by. Most require ingenuity, hardwork and a bit of luck to make them profitable. Plus this is more like trying to buy Bungie after Halo's release not before.

Minecraft isn't like Angry Birds or any other popular mobile title. I don't know of any other franchise that is relevant on just about every platform that has a strong gaming market. Mobile, PC and consoles? Its well supported across all age groups as well.

Given the nature of Minecraft you would think that something would have come along and there would be plenty of competition in this space. But Minecraft is relatively without any major competition.

Minecraft is pretty unique property in the gaming space, which may be why Mojang can ask for 2 billion dollars especially in this day and age where flash in the pans companies have generated interest in the same price range.

 

[bbot]

Spending over two billion dollars to purchase the developer of Minecraft seems excessive. Square Enix would seem like a better choice, I just checked what the market cap of Square Enix is this morning. It's worth $2.6 billion.

 

[Bagel seed]

They made something of the order $100 million profit last year. At that rate, it'd take 20 years to cover the investment. Factor in some growth so more money in ongoing years (or greatly reduced revenue if it becomes platform exclusive!), and then some downturn as people move on to something new, is it really worth 2 billion? MS wanting to buy Mojang I could understand, but the asking price seems a bit crazy as an investment. I'm not sure what the gameplan for returns would be.

Plushies! They're buying it for the potential. Someone somewhere did the valuations and came up with a pie in the sky number that sees Minecraft on every kids lunchbox, cartoon series and a movie franchise. Then they'll tie it into all their products and hope it gives them a more attractive image to their brand.

I guess you can think of it like when Mario was at the top in the early 90s, and if MS came along and bought that..

 

[dobwal]

Spending over two billion dollars to purchase the developer of Minecraft seems excessive. Square Enix would seem like a better choice, I just checked what the market cap of Square Enix is this morning. It's worth $2.6 billion.

Market cap is just the value of the shares outstanding. At least of late most companies are going for around twice their market cap. But for any one companies there are a whole bunch of variables used to determine value. SE might only have a small portion of its authorized shares outstanding.

 

[Silent_Buddha]

Given the nature of Minecraft you would think that something would have come along and there would be plenty of competition in this space. But Minecraft is relatively without any major competition.

There have been a LOT of attempts to profit off of copying Minecraft (dozens of titles on PC as well as a few on Xbox Live IG). None have succeeded. The only thing that is close in sales is Terraria (a 2D take on what Minecraft does with more combat) and that hasn't broken 5 million total sales yet AFAIK. Which isn't that close to the the 54 million+ (before PS4/XBO versions came out so likely far more than that now). No other clones have even broken 1 million in sales AFAIK.

There have been straight clones, clones that tried to innovate, clones that improved the graphics, clones that changed the gametype (first and third person shooters! as well RPGs), etc. Nothing has come even remotely close to replicating the popularity of Minecraft.

And people have been trying since at least 2010 (Terraria came out in 2011). So it's not like there hasn't been time for something else to catch on.

Regards,
SB

 

[AzBat]

I think many of you are too hung up the console implications that MS are most likely buying them for the mobile support. Minecraft is currently the #1 paid app on the Apple App Store...

http://www.apple.com/itunes/charts/paid-apps/

Also, seen reports on a few business news shows this evening talking about the rumor & that's what they're thinking. They seem to like the buy too.

Personally I'd rather see them spend that on price cuts or core games I'm interested in, but that probably won't do much to grow their market & demographic.

Tommy McClain

 

[BRiT]

Personally, I'd rather they spend that 2 Billion on getting an Xbox One.point.Five hardware update out there in the Spring 2015 that jumps to 8GB GDDR5 and 24 active CUs.

 

[function]

When you're a cash rich company filled with execs who get a hardon for spunking huge sums of cash over supposed "big things" that will result in "quick wins", it's probably tempting to try and spunk truly huge sums of cash on big things that will give you quick wins.

2$B would be approx 200 AAA Kinect games.

 

[eastmen]

it doesn't work that way Function. Go ask Sony, For every uncharted how many killzones are there ?

 

[shredenvain]

Personally, I'd rather they spend that 2 Billion on getting an Xbox One.point.Five hardware update out there in the Spring 2015 that jumps to 8GB GDDR5 and 24 active CUs.

I think that would only serve the purpose of pissing people off.
They are just now launching worldwide. They also havent even made it to the systems first birthday. They have 3 pretty big exclusives coming out in the next couple of months that could help push systems. They also wouldnt have much to gain by uping the specs in the first place. It would be a pain to developers and gamers that already own the system.
In fact a move like that would most likely cause their downfall.

 

[Rurouni]

How much money Mojang currently made over its lifetime? Can they generate something that worth 2 billion (directly or indirectly) ?

 

[Deleted member 11852]

How much money Mojang currently made over its lifetime? Can they generate something that worth 2 billion (directly or indirectly) ?

Yup. I believe I read an article that Minecraft had sold over 50m copies across all platforms, you have to wonder what sales potential there is left. If there was a Minecraft 2, it's not necessarily going to sell to anything like the same number of people.

I just don't get it. Normally I'd say any company willing to drop $2Bn on an acquisition must be pretty damn certain about it but some of Microsoft's decisions of late have made no sense to me. Plan or desperation. Time will tell, if it happens.

 

[MfA]

Maybe the prime target for the purchase is Mobile.

Or maybe to push their WinRT tablets ... a gaggle of moneypits to chose from.