Gaming News

Seems like I've been hearing the term "hostile takeover" a lot lately. Recently the term was appended to Microsoft's interest in accruing Yahoo, and then this past week the gaming community was going nuts because EA is trying to buy out Take Two (publisher of both Bioshock and the Grand Theft Auto series). Basically what a hostile takeover is, at least as far as this example goes, is when the pursuing company (EA) offers stockholders in the pursued company (Take Two) a huge chunk of money for their shares. So for instance I believe Take Two's stock was somewhere in the middle teens, and so EA will offer shareholders about $26 per share. It's hard for the shareholders to pass that kind of offer up, and if they go ahead and take the deal and EA gains more than 50% of Take Two's stock then obviously they have enough say to get Take Two to agree to being acquired.

Does that make sense? I re-read it and I wasn't sure...either way it doesn't really matter. The important thing is that EA is trying to buy a really awesome game publisher and a lot of people are concerned about what will happen to their favorite Take Two franchises if this deal goes down. EA has had a rivalry of sorts with Take Two for a long time, because Take Two used to have a competing NFL franchised football game on the market that a lot of gamers preferred over Madden. Then, in what some people consider to be an "evil corporation bent on world domination"-type move, EA gained 100% exclusivity to NFL gaming franchises, pushing Take Two (and the NFL 2K series) out of the market. Now EA has a monopolistic grasp on NFL games so they don't have to keep their products up to snuff in order to sell. Competition is good for everyone, and if anything the lack of competition tends to kill innovation. A lot of people say that's the reason that for the most part the Madden series is the same every year without any new additions to the gameplay. Of course others will say there's only so much you can do with a football game...

This news really doesn't bother me. Although I didn't like when EA pushed Take Two out of the NFL game market, they've already said that if they get ahold of Take Two their stance will be relatively hands-off allowing developers to continue to develop games like they would EA or no EA, and so the end product won't be effected. That's all I worry about. If the game is good I don't care who's publishing it, Take Two or EA it's all the same. Still, there's the "anti-corporate" side of me that makes me lose some respect for EA. This isn't the first publisher EA has tried to swallow up, they also went after Ubisoft not too long ago (creators of the Tom Clancy series of games, Prince of Persia, etc.). Like I said if all of these developers are under EA there isn't much incentive to innovate or put out a truly great game because there's no competition in the market. The thought of Take Two, Dice, and Ubisoft all getting sucked into EA turns my stomach a little.

I guess all we can really do is wait and see at this point. The idea behind a hostile takeover is that the company will be sold whether it wants to be or not, so I guess it's sort of inevitable at this point? Take Two is undoubtedly telling their shareholders to hold off, saying that even at the increased stock price their company is being undervalued, particularly with Grand Theft Auto 4 on the horizon. Projected numbers for GTA4 are easily in the millions, upwards of 9 million copies sold in some cases. That's a cash cow for Take Two, so if investors are told to just hold back and wait until GTA4 comes out Take Two might be able to avoid EA because, by that time, they'll have made enough money to be too costly for EA to purchase.

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The big news in the gaming world this weekend was the merger between Activision (Call of Duty, Guitar Hero, and a slew of licensed games) and the Vivendi Game Unit (which includes Blizzard Entertainment - Warcraft, Starcraft, Diablo).  From what I've read the name of the new amalgamation will be Activision Blizzard.  I'm not sure how I feel about that name, seems pretty lame and I think it would have been better to just keep the names separate but there you go.  Vivendi will have a 52% ownership of the 18 billion dollar venture which, they say, will be complete by mid-2008.

Why this is important to gamers is that this merger has the potential to overthrow EA as the leading game developer in the industry.  Many people seem to loathe EA for treating their staff poorly (often times firing entire teams after a game is finished, not to mention the brutal work schedules) and for having a monopolistic grip on some areas of the market.  One example of this is EA's ownership of NFL game licensing which forced game developers like 2k Sports to close up shop on their football franchises.  Other than that I doubt it makes a huge difference to the consumer.  Of course the first reaction from fans of the respective companies' games was one of concern - everyone just wants to make sure that their work stays consistent.  In order to address these concerns Mike Morhaime (CEO of Blizzard Entertainment) did a little interview to tell everyone things would be alright.  No need to panic.  Business as usual - and so on.

  The other result of the merger is the potential for follow-up titles for the games we already know and love.  Already more or less confirmed on the Activision side of things are Call of Duty 5 and Guitar Hero IV.  Big surprise there, seeing as how those are two of their most successful franchises.  On the Vivendi (read Blizzard) side of things there are rumors of a new MMO to finally overtake World of Warcraft not to mention Starcraft 2.  If you love sequels this merger is for you!  Personally I think an MMO based on Call of Duty would be pretty epic, and hey, they'd kill two birds with one stone.  =)

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