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Vivendi Seeking Activision Buyers

There's more on recent rumors that Vivendi SA is considering selling off its stake in Activision Blizzard on Reuters, where they say that the French telecom giant had decided it will divest itself of the gaming unit. The report indicates that they are gauging interest from those with suitably deep pocketbooks: "Although a formal process has not started, bankers close to Vivendi are sounding out cash-rich trade players, including China's Tencent and U.S. duo Time Warner and Microsoft, as well as private-equity heavyweights KKR, Providence and Blackstone, banking sources said." Reuters got no comment responses about this from Microsoft and Time Warner. Thanks VG247.

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45. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 16:21 Creston
 
Should bring a pretty penny, considering both WoW and Call of Duty are billion dollar franchises and basically a license to print money.

As for who buys it, eh, who cares. Whoever winds up owing them can't be any worse than Vivendi where gaming is concerned, really.

Creston
 
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44. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 15:53 SimplyMonk
 
ASeven wrote on Jul 11, 2012, 15:45:
Did you get to read the other 5-6 pieces about the industry?

Yeah. I'll give the other articles a read later, but your are correct on gaming journalism, but even that could be said for today's journalism as a whole. Too much opinion thrown in to make a story more "interesting" and too much of the author trying to bend it to their view.

From reading that one article though, I didn't get the impression that they though some big crash was going to happen. What I got from it is basically that the industry needs to change as the costs are beginning to outweigh the profits and growth is starting to slow. But we knew that already. The industry knows that already. Why do we see such a big push for DLC? Because they need to keep making money and that is a solid way to do it and you are only going to see more of it in different shapes and forms.

The only way it is going to crash is if you see the industry try to move too fast in the wrong direction or resist change completely like some companies have, but I see no evidence of that.
 
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43. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 15:45 ASeven
 
SimplyMonk wrote on Jul 11, 2012, 15:29:
ASeven wrote on Jul 11, 2012, 15:07:
So yeah, it is an article full of bias, it's a bloody opinion piece.

I'll ignore the fact that you linked the opinion article when making an argument, but I did read the Verge article and didn't find it much better in terms of objectivity. They did at least have a sizable data to back up their statements, but in the end they are still building an opinion based model and their comparisons to the movie industry are accurate in some respects, but don't go far enough.

The reason I linked it is that his conclusions, regardless of bias, are reached through common sense. Regardless of bias his conclusions on to why he thinks this will happen are sound.

SimplyMonk wrote on Jul 11, 2012, 15:29:
Filmmakers can save money by cutting scenes and getting creative with locations, but by-and-large, the cost of making of a movie is relatively fixed.

That is a horrible inaccurate statement, but ignoring that, it is at the end of the article he isn't saying the AAA market is going to die. He is saying it will continue to push for more profits via DLC/Cash-Shops and you'll be paying more out of pocket for it.

Well, of course you are. With CGI, AAA movies started a ton more to make. Did people stop making AAA films? No. They raised ticket prices. They expanded their markets. They started selling "extended-cuts" or "behind-the-scenes" crap to raise DVD prices. They started selling bundles. They found ways to take more of your money that really didn't cost them much.

AAA video games will do the exact same thing and too be honest... I don't really see what is wrong with that. Its a business and an art form. Just like film. The Verge article is good to compare the VG Industry to the Film Industry, but it isn't saying a bubble is going to burst here. It is just saying things are going to change.

Did you get to read the other 5-6 pieces about the industry? Even so, the article does point out things that are objective and provable like the insane rising development costs that cut into the profit margins.

Then again, you have to remember this is gaming journalism. Which is to say, it's not journalism at all but more opinions and/or shills. Even so that Verge article is rather decent compared to the standards of gaming journalism, hence the reason I linked it and the opinion piece that draws conclusions from it.
 
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42. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 15:31 nin
 
Kastagir wrote on Jul 11, 2012, 15:29:
I can't think of a more suitable hole for Blizzard to disappear into than Microsoft Games. So many far more deserving developers have met their fates there, it would be fitting for this trash receptacle to be used to dispose of what Blizzard has become.

Can you imagine if MS got WOW running on their next console, and used it as a selling point? WOWs existing base would have a rage stroke.

 
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41. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 15:29 Kastagir
 
I can't think of a more suitable hole for Blizzard to disappear into than Microsoft Games. So many far more deserving developers have met their fates there, it would be fitting for this trash receptacle to be used to dispose of what Blizzard has become.  
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40. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 15:29 SimplyMonk
 
ASeven wrote on Jul 11, 2012, 15:07:
So yeah, it is an article full of bias, it's a bloody opinion piece.

I'll ignore the fact that you linked the opinion article when making an argument, but I did read the Verge article and didn't find it much better in terms of objectivity. They did at least have a sizable data to back up their statements, but in the end they are still building an opinion based model and their comparisons to the movie industry are accurate in some respects, but don't go far enough.

Filmmakers can save money by cutting scenes and getting creative with locations, but by-and-large, the cost of making of a movie is relatively fixed.

That is a horrible inaccurate statement, but ignoring that, it is at the end of the article he isn't saying the AAA market is going to die. He is saying it will continue to push for more profits via DLC/Cash-Shops and you'll be paying more out of pocket for it.

Well, of course you are. With CGI, AAA movies started a ton more to make. Did people stop making AAA films? No. They raised ticket prices. They expanded their markets. They started selling "extended-cuts" or "behind-the-scenes" crap to raise DVD prices. They started selling bundles. They found ways to take more of your money that really didn't cost them much.

AAA video games will do the exact same thing and too be honest... I don't really see what is wrong with that. Its a business and an art form. Just like film. The Verge article is good to compare the VG Industry to the Film Industry, but it isn't saying a bubble is going to burst here. It is just saying things are going to change.
 
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39. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 15:22 ASeven
 
Another financial site not being too optimistic on the gaming industry.  
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38. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 15:10 ASeven
 
Link to that Verge article on the State of AAA.

Here's a link to the whole series.
 
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37. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 15:07 ASeven
 
SimplyMonk wrote on Jul 11, 2012, 15:04:
ASeven wrote on Jul 11, 2012, 14:56:
These guys which probably know a lot more about gaming and finances than you ever could, are wrong?

That article is full of bias and guesses about industry trends. Even the article it references to is filled with opinion and faulty data.

Regardless, the gaming industry is still growing hand-over-foot and getting bigger each year, it may just get to a point where it swallows up the mainstream AAA players and we'll just get stuck with a lot of cool indie titles. A gamer can dream.

Yeah. Way to stay objective there, buddy. That's good journalism.

It shouldn't be, this is an opinion piece based on a The Verge article, which you should read. This guy is simply making his opinion public based on the rather objective Verge report. So yeah, it is an article full of bias, it's a bloody opinion piece.
 
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36. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 15:05 ASeven
 
SimplyMonk wrote on Jul 11, 2012, 14:58:
Beamer wrote on Jul 11, 2012, 14:46:
Anyone that thinks AAA games will cease to exist, or that people will stop making millions on them, is nuts. Flat out nuts.

Have to agree here. The industry may continue to shrink and we may even lose a platform, but to think that AAA games will suddenly disappear is crazy without some unpredictable event.

Something I think is more probable is publisher start to sell AAA titles at a loss on release, but start making real profits with DLC/episodic content/cash shops. Something on a level greater than what they've been doing today. But that would require IPs and game play that fits that model well.

I point you to these two articles, here and here, and remind you that in 1983 there was also a crash that meant AAA games were dead for a while. Funny thing is, the same causes that made the 83 crash possible are exactly the same ones today when you look down at the basic of it.

Hell, the only thing that was gone in the 83 crash were the AAA games, or rather, their equivalent. The equivalent of our today's indies kept on, unhindered and not caring and they were the ones that propped the industry back up. Shame they forgot the errors of the past and are now repeating them all over again.
 
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35. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 15:04 SimplyMonk
 
ASeven wrote on Jul 11, 2012, 14:56:
These guys which probably know a lot more about gaming and finances than you ever could, are wrong?

That article is full of bias and guesses about industry trends. Even the article it references to is filled with opinion and faulty data.

Regardless, the gaming industry is still growing hand-over-foot and getting bigger each year, it may just get to a point where it swallows up the mainstream AAA players and we'll just get stuck with a lot of cool indie titles. A gamer can dream.

Yeah. Way to stay objective there, buddy. That's good journalism.
 
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34. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 15:04 RollinThundr
 
Beamer wrote on Jul 11, 2012, 14:46:
RollinThundr wrote on Jul 11, 2012, 14:32:
ASeven wrote on Jul 11, 2012, 11:02:
Even Moody knows what's coming.

Everyone with half a brain knows what's coming. Except Beamer.

Anyone that thinks AAA games will cease to exist, or that people will stop making millions on them, is nuts. Flat out nuts.

Never said AAA titles will cease to exist, but if you think the way the games industry has been headed the last few years financially is substanable, where you need to sell 5 million of a supposidly AAA title to break even, then I don't know what to tell you.
 
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33. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 15:02 ASeven
 
Beamer wrote on Jul 11, 2012, 14:17:
And I don't want to get into it here, but ASeven, you said the government couldn't seize a business because it was a violation of due process to do so. I said that's absolutely wrong and it happens all the time. Businesses get seized.

What was found to be an issue for Megaupload was that the business wasn't in the US's jurisdiction, which I said may come back to bite them because it was handled poorly. And right now that's coming to bite them in the ass.

But megaupload is still down, Kim Dotcom is still pending trial, etc. New Zealand has returned his assets. The US Government has done no such thing. Megaupload has not been returned to him, nor has anyone said it will be.

Yes Beamer, it wasn't due to Due Process at all that the US DOJ is likely to lose this and Kim has turned into a folk hero of sorts. Right Beamer, your knowledge of the law is as accurate as your knowledge of finances. That is to say you know shit. Because the feds never done it before, totally disregarding due process to sue a site that ended up being innocent. Oh wait...
 
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32. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 14:58 SimplyMonk
 
Beamer wrote on Jul 11, 2012, 14:46:
Anyone that thinks AAA games will cease to exist, or that people will stop making millions on them, is nuts. Flat out nuts.

Have to agree here. The industry may continue to shrink and we may even lose a platform, but to think that AAA games will suddenly disappear is crazy without some unpredictable event.

Something I think is more probable is publisher start to sell AAA titles at a loss on release, but start making real profits with DLC/episodic content/cash shops. Something on a level greater than what they've been doing today. But that would require IPs and game play that fits that model well.
 
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31. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 14:56 ASeven
 
Beamer wrote on Jul 11, 2012, 14:46:
RollinThundr wrote on Jul 11, 2012, 14:32:
ASeven wrote on Jul 11, 2012, 11:02:
Even Moody knows what's coming.

Everyone with half a brain knows what's coming. Except Beamer.

Anyone that thinks AAA games will cease to exist, or that people will stop making millions on them, is nuts. Flat out nuts.

So some of the biggest sites in the internet are nuts? Cinemablend, which before you open your mouth and say any more shit like you've been in the past messages, is a site that is tracked by the blotters of the financial companies is wrong then, Beamer? These guys which probably know a lot more about gaming and finances than you ever could, are wrong?

Or these guys who once again are also tracked by the finance blotters, meaning they do have weight on what they say?

The market should be listening to you instead, a one-bit irrelevant apologist and likely shill who knows almost nothing of finances? That's why the EA stocks and all gaming publisher stocks are rockecting sky high! Oh wait...
 
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30. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 14:52 ASeven
 
Beamer wrote on Jul 11, 2012, 14:03:
ASeven wrote on Jul 11, 2012, 12:43:
Parallax Abstraction wrote on Jul 11, 2012, 11:36:
ASeven wrote on Jul 11, 2012, 11:02:
Moody finds Activision a liability, and if they find the most financial solid publisher in gaming a liability they find the whole market a liability.

That's not what that means necessarily. Liabilities in accounting terms just means debts. For example, your credit card bills, car loan, mortgage etc. are all what banks call "liabilities" because it's money you owe. From what I understand, Vivendi's in pretty heavy debt right now largely due to some of their other operations that aren't profitable and they're looking to sell Activision because it's one of the few major moneymakers they have and they want the cash infusion to prop up the rest of the company. Not to say that they maybe don't also want out of it because they see the AAA market declining but Moody's saying that Activision wants to reduce liabilities likely just means reduce debt. I just checked with my Chartered Accountant girlfriend and she said that's likely what they mean. Doesn't make a huge different to me either way, just food for thought.

EDIT: Dammit Beamer!

Yes, true, Vivendi is a skinking ship too but the Moody report says for Vivendi to get rid of liabilities in the financial accounting sense while at the same time damning the industry a bit by implying it no longer is a profitable venture for investors to go there. Hence adding 2 plus 2 together I reached the conclusion that Moody may mean Activision is a liability in both senses. They know that they cannot live much longer milking the same IPs and showing no evolution or innovation.

Other funny things have happened like Ricitello, EA CEO, selling all his EA stock recently and then confessing he's afraid of his job security to Pachter which he promptly spread to the media.

Even the CEOs know what's coming.

I'll get to due process in a second, let's get to your asinine comments. Ricitello sold all his stock? WHEN? He's acquired more than he's sold over the past 2 years.

And he's afraid of job security because the stock hasn't budged. Every CEO is afraid when that happens. His job is solely to maximize shareholder value, and if the stock isn't moving then he may not be doing that. Importantly, if the stock should be falling and it's not falling as quickly then he could be considered maximizing value, so that he's concerned about his performance shows that he thinks the problem can be viewed as him, not the company or the industry.

But he did not "sell all his EA stock," and you need to stop saying things like that.

Oh my Beamer, why so emotional? One might say you sound like you have something to lose with all of this EA blunder...

Going through your rant in order:

I stand corrected, he did not sale all his stocks. He must still hold on to about 258K stocks of EA. My bad.

Your view of job security is a nice, technical and completely irrelevant since you personally have no idea what John and the investors are feeling and he certainly has fucked things up from Jan 2012 to now. To wit, From Jan 2012 to this day EA has lost in market capitalization something akin to $3B, doing a quick mental calculation. On the first stock day of Jan 2012 the Market Capitalization of EA was something bordering the $5B-$6B compared to today's $3.68B. I think that a loss of $2B+ of market capitalization is a big enough reason for any CEO to worry about his place. And you also point out all that is wrong in the gaming industry, with publishers today. EA's CEO job is to "solely to maximize shareholder value" and not actually hear what gamers, the main customers, want. No wonder this and many industries are slowly sinking, losing touch with the customers is a sure way to prevent said companies of ever making a reasonable profit ever again.
 
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29. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 14:46 Beamer
 
RollinThundr wrote on Jul 11, 2012, 14:32:
ASeven wrote on Jul 11, 2012, 11:02:
Even Moody knows what's coming.

Everyone with half a brain knows what's coming. Except Beamer.

Anyone that thinks AAA games will cease to exist, or that people will stop making millions on them, is nuts. Flat out nuts.
 
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http://www.deathwishinc.com
http://www.hydrahead.com
http://www.painkillerrecords.com
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28. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 14:32 RollinThundr
 
ASeven wrote on Jul 11, 2012, 11:02:
Even Moody knows what's coming.

Everyone with half a brain knows what's coming. Except Beamer.
 
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27. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 14:18 Beamer
 
Scheherazade wrote on Jul 11, 2012, 14:15:
Bosanac wrote on Jul 11, 2012, 11:22:
I don't get it.. Blizzard is a cash cow.. COD is a cash cow. Why call it liability?

Investors value business growth over business size.
A company that made 1 million last year and 10 million this year, is WAY more attractive than a company that made 100 million every year for the last N years.

Growth lets investors multiply their money.
Steady earnings just let you skim off some dividends.
Hence they can treat an extremely profitable "steady" business like it's worthless dirt.

-scheherazade

More importantly, Vivendi needs money now. They don't need the slow trickle of Activision money, though it's nice, they need a large chunk of change as soon as possible.
Their other assets are all hard to spin off and much closer to their business. Activision is a nicely independent island, with Vivendi holding a majority of it. That majority can be transferred to another owner with no real glitches.

It's about getting money as quickly as possible.
 
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Music for the discerning:
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http://www.hydrahead.com
http://www.painkillerrecords.com
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26. Re: Vivendi Seeking Activision Buyers Jul 11, 2012, 14:17 Beamer
 
And I don't want to get into it here, but ASeven, you said the government couldn't seize a business because it was a violation of due process to do so. I said that's absolutely wrong and it happens all the time. Businesses get seized.

What was found to be an issue for Megaupload was that the business wasn't in the US's jurisdiction, which I said may come back to bite them because it was handled poorly. And right now that's coming to bite them in the ass.

But megaupload is still down, Kim Dotcom is still pending trial, etc. New Zealand has returned his assets. The US Government has done no such thing. Megaupload has not been returned to him, nor has anyone said it will be.
 
-------------
Music for the discerning:
http://www.deathwishinc.com
http://www.hydrahead.com
http://www.painkillerrecords.com
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