Electronic Arts makes another bid for Take-Two
02-26-08, 10:06 PM
#26
DVD Talk Hero
I've heard them talk about it in interviews - and it would be a platform not unlike, say, a dvd player, where you have many different models, but they all play the same dvds, and no dvd is exclusive to one player. While it might not be the best thing to happen to the industry, I seriously doubt it'd kill it either. I mean, heck, the 360 and the PS3 are virtually identical, and share many of the same games already. It would be easier on developers, and the millions that are poured into making games now would be easier to get a return on. It could make games cheaper even. But yeah, EA does suck, so let's hope it doesn't happen under their watch.
02-26-08, 10:13 PM
#27
Banned
Join Date: Jan 2006
Posts: 6,584
Likes: 0
Received 0 Likes
on
0 Posts
Originally Posted by fujishig
I can't even imagine how EA would go about forcing one platform. Sony, Nintendo, and even Microsoft are still strong first parties that will not (not anytime soon, at least) be sold to EA. I guess you can point to Sega, but it seems like three platforms are sustainable in the current market.
Where did this "EA wants one platform" stuff come from anyway? An article? Or just speculation? They may very well want to be the only third party publisher of any significance, but even then they haven't bought up any Japanese companies to my knowledge.
Where did this "EA wants one platform" stuff come from anyway? An article? Or just speculation? They may very well want to be the only third party publisher of any significance, but even then they haven't bought up any Japanese companies to my knowledge.
If they were to also buy up enough third party companies, then all of those companies would only develop games exclusively for the EA console. Microsoft, Sony, and Nintendo would then only have their own first party titles to fall back on and whatever third party companies EA doesn't manage to acquire.
A console can not do well just on first party games alone. Look at the N64 for example. Many, many third party companies abandoned Nintendo during the N64 days, and Nintendo suffered very badly as a result.
02-26-08, 10:30 PM
#28
DVD Talk Godfather
Originally Posted by slop101
I've heard them talk about it in interviews - and it would be a platform not unlike, say, a dvd player, where you have many different models, but they all play the same dvds, and no dvd is exclusive to one player. While it might not be the best thing to happen to the industry, I seriously doubt it'd kill it either. I mean, heck, the 360 and the PS3 are virtually identical, and share many of the same games already. It would be easier on developers, and the millions that are poured into making games now would be easier to get a return on. It could make games cheaper even. But yeah, EA does suck, so let's hope it doesn't happen under their watch.
And unlike DVD players, where you can sell a $30 player and still have $100 and $200 DVD players that largely do the same thing, I can't see that happening with a console where everything has to work/look/play the same. Otherwise you get *gasp* the PC, where low end machines can play this and that at lower quality then a more expensive system.
As far as EA trying to put out their own console, I actually don't think their resources stretch that far. Microsoft had enough trouble and EA isn't anywhere close to being that loaded with money. And I really think the more EA trys to buy up other studios and companies, it would just spur more and more upstart developers and studios.
02-27-08, 11:35 AM
#30
DVD Talk Hero
If EA bought all these companies, made their own console, and then published only for that console, wouldn't they be in trouble too because all of their games would then be "only 1st party" games? They'd be hard pressed to enter a market where Nintendo has been rejuvenated, and both other parties, though they've faltered in their own ways, are well-entrenched. Also, unlike Sony or MS, they have no hardware division that I know of.
I believe they tried this multi-branded stuff with... the 3D0 was it? I don't remember. However, I thought that companies usually lose money on the consoles and make it up by game sales, mainly through 1st party games and licensing costs for 3rd party games.
I believe they tried this multi-branded stuff with... the 3D0 was it? I don't remember. However, I thought that companies usually lose money on the consoles and make it up by game sales, mainly through 1st party games and licensing costs for 3rd party games.
02-27-08, 11:46 AM
#31
DVD Talk Hero
Originally Posted by fujishig
If EA bought all these companies, made their own console, and then published only for that console, wouldn't they be in trouble too because all of their games would then be "only 1st party" games?
All these companies make far more money on the games than the consoles anyways.
02-27-08, 11:55 AM
#32
Suspended
Originally Posted by joystiq.com
Pachter prognosticates that EA will continue working angles for a takeover and is doing so to stop Take-Two's sports franchises, which he estimates will cost EA $150 million in operating profit this year.
02-27-08, 12:15 PM
#33
DVD Talk Gold Edition
Didn't 2k buy the sports division FROM Microsoft?
Everyone stop saying EA SPORTS is a monopoly, thats like saying New Line has a Monopoly on the Lord of the Rings Movies or WB has a monopoly on Harry Potter.
Everyone stop saying EA SPORTS is a monopoly, thats like saying New Line has a Monopoly on the Lord of the Rings Movies or WB has a monopoly on Harry Potter.
02-27-08, 12:23 PM
#34
DVD Talk Legend
EA does want to have control over the sports video game market. They want to be able to force you to buy their product if you want the real NFL, College or other pro teams. They want to be able to shovel out shit and have you eat it because you have no other choice. I bought last year's NCAA 08 and was extremely disappointed. I will not be making that same mistake again.
02-27-08, 12:27 PM
#35
Suspended
Originally Posted by DVDChris
Didn't 2k buy the sports division FROM Microsoft?
Everyone stop saying EA SPORTS is a monopoly, thats like saying New Line has a Monopoly on the Lord of the Rings Movies or WB has a monopoly on Harry Potter.
Everyone stop saying EA SPORTS is a monopoly, thats like saying New Line has a Monopoly on the Lord of the Rings Movies or WB has a monopoly on Harry Potter.
EA Sports has a monopoly on NFL Football games. As it's been shown with All-Pro and Blitz... non-NFL games won't sell.
EA Sports now has a monopoly on college basketball and football games. No one else can make a licensed college game. And like the NFL, in this day and age, non-licensed games won't sell.
EA won't have a monopoly on MLB games if they buy 2K Sports, since the license allows for first parties to make their own titles. So it'll be Sony and whatever EA decides to do.
NHL - Someone else could step up and make a new NHL game if they wanted to, but starting from the ground up at this point would be incredibly difficult.
02-27-08, 12:58 PM
#37
DVD Talk Gold Edition
That is all true. I think the term monopoly has a negative connotation:
mo·nop·o·ly - 1. exclusive control of a commodity or service in a particular market, or a control that makes possible the manipulation of prices.
I don't think EA is going to raise the prices if they control all sports games.
As an example, I love Batman. But I don't complain about the monopoly WB has on all the Batman movies. They sometimes make bad movies (Batman & Robin), but the latest one was good. You can choose to watch it or not.
mo·nop·o·ly - 1. exclusive control of a commodity or service in a particular market, or a control that makes possible the manipulation of prices.
I don't think EA is going to raise the prices if they control all sports games.
As an example, I love Batman. But I don't complain about the monopoly WB has on all the Batman movies. They sometimes make bad movies (Batman & Robin), but the latest one was good. You can choose to watch it or not.
02-27-08, 01:02 PM
#38
Suspended
The difference between sports games and movies is that rights for movies have always belonged to one studio or production company. Same with movie based games. I don't think that's the issue. The issue is that we've gone from anyone being able to make a sports game to only one company being able to do it. If sports licenses had always been exclusive, like say the rights to Spider-Man, we wouldn't care as much.
02-27-08, 02:33 PM
#39
DVD Talk Hero
Originally Posted by slop101
That's not what they want to do at all. I don't think they even want to make a console - they just want to develop for one console - one console that Sony, Nintendo, MS and EA would all develop for together, whatever that may/could be.
All these companies make far more money on the games than the consoles anyways.
All these companies make far more money on the games than the consoles anyways.
02-27-08, 08:51 PM
#40
DVD Talk Legend
If EA buys and owns Take Two we can expect more GTA sequels at a quicker rate but with little innovation. I give a big thumbs down to this notion. EA can't even make great games for the licensing that they already have.
03-13-08, 12:39 PM
#41
Guest
Thread Starter
Join Date: Jul 1999
Location: Glendale, next to L.A.
Posts: 18,484
Likes: 0
Received 1 Like
on
1 Post
Link
Chris
Electronic Arts' Take-Two bid goes hostile
Merger offer taken directly to shareholders after management rebuffs
By Dan Gallagher & Steve Goldstein, MarketWatch
Last update: 11:33 a.m. EDT March 13, 2008
SAN FRANCISCO (MarketWatch) -- Electronic Arts took its fight directly to shareholders of Take-Two Interactive Software on Thursday, launching a tender offer for the video game publisher after being rebuffed by the company's management.
In a statement issued Thursday morning, Electronic Arts said it has commenced a tender offer worth $26 per share in cash for Take-Two, the publisher of the blockbuster "Grand Theft Auto" video game franchise. The $2 billion offer matches one made earlier to Take-Two's management, which rejected the bid as "significantly undervaluing" the company's business.
"We believe Take-Two investors will see our tender offer as the best way to maximize the value of their investment in Take-Two. This tender offer provides a clear process to complete the proposed transaction," said John Riccitiello, EA's chief executive, in a statement.
The tender is due to expire at midnight Eastern time on April 11. The offer is not conditional on any financing.
Shares of Take-Two rose 1.8% to $25.35 in early trading Tuesday. They have been trading below the $26 offer price since last week. EA shares were trading down 2.3% at $46.15.
EA began approaching Take-Two about a potential merger last month. After seeing its first offer rejected, EA made its desires public on Feb. 24, announcing that it had sent an offer to Take-Two's management, which only took control of the company last year following a revolt by shareholders who voted out the company's previous team of top executives.
Take-Two rejected EA's overtures, saying the bid undervalues its business. But the company has said it would be willing to enter discussions once "Grand Theft Auto IV" is launched on April 29. The company issued a statement Thursday advising shareholders not to take action on the EA offer until its board of directors reviews the deal.
Some of the company's shareholders were already getting restless.
Earlier this week, two of the company's largest shareholders disclosed that they sold off large portions of their ownership stakes. Another shareholder has sued Take-Two over its refusal to negotiate with EA.
"The company's stance on EA hasn't changed except to get colder, if that's possible," wrote William Lennan of Broadpoint Capital in a note to clients. "Take-Two is in danger of chasing away the only company in the world that can bid in the mid-$20s for its stock." Read related story.
Riccitiello added a warning to Thursday's tender offer. "There can be no certainty that in the future EA or any other buyer would pay the same high premium we are offering today," he wrote.
He said that "timely completion of the transaction would allow EA's strong publishing and distribution network to positively impact the ongoing post-launch sales of GTA IV and support the new Take-Two titles scheduled for launch later in the year and during the holiday selling season."
Arvind Bhatia of Sterne Agee said EA may end up raising its bid by $1-$2 per share if the tender offer falls short of securing support from a majority of shareholders.
"We feel the tender offer is likely to succeed as Take-Two shareholders consider and weigh the risk of EA walking away from the proposal if majority ownership is not met," he wrote in a note to clients Thursday.
Michael Pachter of Wedbush Morgan thinks Take-Two shareholder "will jump at the offer," given that the company's shareholder base has changed in recent weeks as some long-term holders have sold off positions.
"The absence of any 5% filings during this period suggests to us that the buyers of these shares were risk arbitrageurs, and we think that their response to EA's offer will be less emotional and more pragmatic than the response from Take-Two's management," Pachter wrote in a note to clients Thursday.
Morgan Stanley is advising Electronic Arts. Bear Stearns and Lehman Bros. are advising Take-Two.
Dan Gallagher is MarketWatch's technology editor, based in San Francisco.
Steve Goldstein is MarketWatch's London bureau chief.
Merger offer taken directly to shareholders after management rebuffs
By Dan Gallagher & Steve Goldstein, MarketWatch
Last update: 11:33 a.m. EDT March 13, 2008
SAN FRANCISCO (MarketWatch) -- Electronic Arts took its fight directly to shareholders of Take-Two Interactive Software on Thursday, launching a tender offer for the video game publisher after being rebuffed by the company's management.
In a statement issued Thursday morning, Electronic Arts said it has commenced a tender offer worth $26 per share in cash for Take-Two, the publisher of the blockbuster "Grand Theft Auto" video game franchise. The $2 billion offer matches one made earlier to Take-Two's management, which rejected the bid as "significantly undervaluing" the company's business.
"We believe Take-Two investors will see our tender offer as the best way to maximize the value of their investment in Take-Two. This tender offer provides a clear process to complete the proposed transaction," said John Riccitiello, EA's chief executive, in a statement.
The tender is due to expire at midnight Eastern time on April 11. The offer is not conditional on any financing.
Shares of Take-Two rose 1.8% to $25.35 in early trading Tuesday. They have been trading below the $26 offer price since last week. EA shares were trading down 2.3% at $46.15.
EA began approaching Take-Two about a potential merger last month. After seeing its first offer rejected, EA made its desires public on Feb. 24, announcing that it had sent an offer to Take-Two's management, which only took control of the company last year following a revolt by shareholders who voted out the company's previous team of top executives.
Take-Two rejected EA's overtures, saying the bid undervalues its business. But the company has said it would be willing to enter discussions once "Grand Theft Auto IV" is launched on April 29. The company issued a statement Thursday advising shareholders not to take action on the EA offer until its board of directors reviews the deal.
Some of the company's shareholders were already getting restless.
Earlier this week, two of the company's largest shareholders disclosed that they sold off large portions of their ownership stakes. Another shareholder has sued Take-Two over its refusal to negotiate with EA.
"The company's stance on EA hasn't changed except to get colder, if that's possible," wrote William Lennan of Broadpoint Capital in a note to clients. "Take-Two is in danger of chasing away the only company in the world that can bid in the mid-$20s for its stock." Read related story.
Riccitiello added a warning to Thursday's tender offer. "There can be no certainty that in the future EA or any other buyer would pay the same high premium we are offering today," he wrote.
He said that "timely completion of the transaction would allow EA's strong publishing and distribution network to positively impact the ongoing post-launch sales of GTA IV and support the new Take-Two titles scheduled for launch later in the year and during the holiday selling season."
Arvind Bhatia of Sterne Agee said EA may end up raising its bid by $1-$2 per share if the tender offer falls short of securing support from a majority of shareholders.
"We feel the tender offer is likely to succeed as Take-Two shareholders consider and weigh the risk of EA walking away from the proposal if majority ownership is not met," he wrote in a note to clients Thursday.
Michael Pachter of Wedbush Morgan thinks Take-Two shareholder "will jump at the offer," given that the company's shareholder base has changed in recent weeks as some long-term holders have sold off positions.
"The absence of any 5% filings during this period suggests to us that the buyers of these shares were risk arbitrageurs, and we think that their response to EA's offer will be less emotional and more pragmatic than the response from Take-Two's management," Pachter wrote in a note to clients Thursday.
Morgan Stanley is advising Electronic Arts. Bear Stearns and Lehman Bros. are advising Take-Two.
Dan Gallagher is MarketWatch's technology editor, based in San Francisco.
Steve Goldstein is MarketWatch's London bureau chief.
Chris
03-13-08, 12:51 PM
#43
DVD Talk Godfather
EA just can't stand being #2 can they? 
IMO, this is all about killing off their sports competition. GTA, Bioshock and some of the other 2K titles are a nice value added bonus.
IMO, this is all about killing off their sports competition. GTA, Bioshock and some of the other 2K titles are a nice value added bonus.
03-13-08, 01:01 PM
#44
Suspended
Originally Posted by Michael Corvin
EA just can't stand being #2 can they?
IMO, this is all about killing off their sports competition. GTA, Bioshock and some of the other 2K titles are a nice value added bonus.
IMO, this is all about killing off their sports competition. GTA, Bioshock and some of the other 2K titles are a nice value added bonus.
Wedbush Morgan Securities' right-more-often-than-not analyst Michael Pachter believes that in the end EA will acquire Take-Two. Pachter prognosticates that EA will continue working angles for a takeover and is doing so to stop Take-Two's sports franchises, which he estimates will cost EA $150 million in operating profit this year.
03-13-08, 01:10 PM
#46
DVD Talk Godfather
Originally Posted by lotsofdvds
Analysts agree with you...
Although I have to wonder, would EA be as stupid as to obliterate 2K Sports if they owned them? Or allow them to continue to exist? Yes, they pull $150 million away from EA... but if EA owns them they get that profit, right? Or will they just be nambypamby douches and wipe the company off the face of the earth?
Although I have to wonder, would EA be as stupid as to obliterate 2K Sports if they owned them? Or allow them to continue to exist? Yes, they pull $150 million away from EA... but if EA owns them they get that profit, right? Or will they just be nambypamby douches and wipe the company off the face of the earth?
I wish shareholders of these companies actually cared about them.
03-13-08, 01:10 PM
#47
DVD Talk Hero
Originally Posted by lotsofdvds
Analysts agree with you...
Although I have to wonder, would EA be as stupid as to obliterate 2K Sports if they owned them? Or allow them to continue to exist? Yes, they pull $150 million away from EA... but if EA owns them they get that profit, right? Or will they just be nambypamby douches and wipe the company off the face of the earth?
Although I have to wonder, would EA be as stupid as to obliterate 2K Sports if they owned them? Or allow them to continue to exist? Yes, they pull $150 million away from EA... but if EA owns them they get that profit, right? Or will they just be nambypamby douches and wipe the company off the face of the earth?
03-13-08, 01:34 PM
#48
DVD Talk Legend
NBA Live can suck it. 2K blows it away and EA knows this and can't stand it. A yearly GTA would be like playing Russian Roulette in Nam on a weekly basis. You would get a quick rush at first but it would grow old fast.
03-13-08, 02:01 PM
#49
Senior Member
Join Date: Aug 2004
Posts: 383
Likes: 0
Received 0 Likes
on
0 Posts
For me this has never been an "I HATE E.A." issue. Do I feel the quality of EA's products have gone down hill since their increase in power? Yes. But this isn't just an E.A. issue. Things that happen now could affect the industry greatly in the future.
Here is my concern. Right now, as the industry gets larger and larger, we are setting precedent (legal and social) for how the industry will function and what guidelines they will have to follow in the years to come. If we allow these larger companies to form "monopolies" on certain aspects of the industry right now we could have trouble fighting those companies down the road when they get to larger and start bending the laws to their agendas.
I am aware that the government has put in place laws, rules, and regulations regarding the definition of a monopoly and what boundaries a company has, but the video game industry has been regarded for so long as an industry for children and an industry that carries no financial effects on the economy that it has been a largely ignored for a long time. Now that this industry is starting to show that it can generate large financial gains and that their is a lot of money to be had the government really needs to step in and squash the threat of unfair competition before the fore-fathers of this industries financial boom gain enough power that they could literally obliterate the smaller competitors with their resources.
Here is my concern. Right now, as the industry gets larger and larger, we are setting precedent (legal and social) for how the industry will function and what guidelines they will have to follow in the years to come. If we allow these larger companies to form "monopolies" on certain aspects of the industry right now we could have trouble fighting those companies down the road when they get to larger and start bending the laws to their agendas.
I am aware that the government has put in place laws, rules, and regulations regarding the definition of a monopoly and what boundaries a company has, but the video game industry has been regarded for so long as an industry for children and an industry that carries no financial effects on the economy that it has been a largely ignored for a long time. Now that this industry is starting to show that it can generate large financial gains and that their is a lot of money to be had the government really needs to step in and squash the threat of unfair competition before the fore-fathers of this industries financial boom gain enough power that they could literally obliterate the smaller competitors with their resources.
