6 ms·

It seems crazy to me that Blizzard/Activision is worth more than Arm. I get BA has tons of world-famous games, but almost every phone on earth is Arm. Arm is ta

by awill 5y ago

It seems crazy to me that Blizzard/Activision is worth more than Arm. I get BA has tons of world-famous games, but almost every phone on earth is Arm. Arm is taking over laptops and servers too.

JumpCrisscross 5y ago
> almost every phone on earth is Arm. Arm is taking over laptops too. Is there a RISC-V analog to Blizzard/Activision?
- jdhawk 5y ago
  SiFive?
- Cyph0n 5y ago
  Ubisoft?
- throwaway946513 5y ago
  Indie developers?
- mhh__ 5y ago
  Is there a RISC-V analog to ARM? They're simply not in the same league (yet).
__s 5y ago
I imagine Blizzard would be worth less if all their IP was licensed out to other large game studios with very liberal terms
- stefan_ 5y ago
  And everyone actually making competitive products was doing so because of their own extensions, not whatever Blizzard did.
- mrandish 5y ago
  Yes, that's a big reason why the valuations are different. ARM's designs being so central to the products of so many companies has occurred only because of ARM's licensing terms being so liberal, including things like forward pricing caps, MFN clauses, etc. They basically chose to trade away pricing power (hence margin) for ubiquity and longer-term relationships.
- easton_s 5y ago
  This is the current LucasFilm Games model. No more artists, only managers and sales who have no true vision for their IP.
ashtonkem 5y ago
This is one of those arguments that the stock market doesn't really align value with social need. Making games is good and all, people like and need entertainment, but from a social perspective we need ARM more than we need Activision.
- missedthecue 5y ago
  The stock market (attempts to) align value with future projected cashflows, not social need. I don't believe it's ever been the case that social need was part of the equation, particularly given that it's such a subjective measure.
- mr_toad 5y ago
  We need water more than we need diamonds.
thrwyoilarticle 5y ago
Arm has an unusually high relevance/value ratio. As Softbank found out, you can't just ramp up the licence costs. It's also not as scalable as software and doesn't have the revenue of the hardware licensees. I wish it would be bought by an open consortium to protect the millenia of engineering hours from snatch-and-grabs like these or the tyranny of uninformed investors but FAANG et al passed up the chance to secure their computing future last time. They've been blessed with another chance, hopefully this debacle has been eye opening. I wouldn't be surprised if Arm employees create more value for other companies than they do for Arm.
- klelatti 5y ago
  Great comment and your last para is undoubtedly true. Really surprised that the hyperscalers don’t see the value in investing in Arm to develop competitive server / cloud CPUs.
- 01100011 5y ago
  > open consortium You expect an open consortium to continue to innovate in an industry leading way? An open consortium is how you kill ARM. ARM didn't get where it is now by being sub-par. I appreciate your intent and it seems like a nice idea, but my experience with community development means ARM would turn into an absolute shit show as various stakeholders fight for control and ram through a mish-mash of their pet personal features.
  - SV_BubbleTime 5y ago
    Everytime I see someone recommend a special interest group or consortium… I think of Bluetooth and it’s literally thousands of pages spec. Then when they have the chance to almost completely start over… the make BLE with approximately 1/2 of what people want and spend years bloating the spec on that too. I’ll take a talented lunatic with autonomy over 20 different voices in a bureaucratic community every time.
    - thrwyoilarticle 5y ago
      And how many PCI-E cards do you think this comment took to reach my screen?
mbesto 5y ago
I like this quote about entertainment: "Two weeks ago, at the Code Conference, Endeavor CEO Ari Emanuel claimed “the total addressable market of content is infinite.” Netflix is spending $17 billion a year to validate his thesis. So far, they’re both right." https://www.profgalloway.com/stream-on-2/ https://www.profgalloway.com/stream-on-2/
- sydthrowaway 5y ago
  Consoom
papito 5y ago
As Scott Galloway put it, Call of Duty alone generates $55M a day, as if it were a door-busting Marvel movie opening weekend, all the time.
- sydthrowaway 5y ago
  And yet gamedevs are paid like crap Who gets the money?
  - papito 5y ago
    Let me introduce you to the concept of "shareholder value".
- paulmd 5y ago
  dang, $20b a year for COD alone? I realize that's the crown jewel in ActiBlizz's portfolio but that does kinda put the acquisition into perspective, you could throw away every single other IP they own (and there are numerous ofc) and Microsoft only paid 2.5y of revenue for COD. $70b is really kinda cheap. (I realize there's some ongoing development costs there - that $20b a year is conditional on you spending $500m a year to make next year's game - but there's also no reason to doubt that revenue stream will continue either. COD is shovelware (it's AAA but you get my meaning) and if you just don't mess it up (BF2042 says hi) then there's no reason to doubt the customers will keep coming back. And again, that's 2.5y revenue of just one asset of a giant company. Cheap cheap cheap.)
colinmhayes 5y ago
Microsoft saw how successful sony's strategy of exclusive games was last generation and is copying it to help their SAASification of the gaming market. Microsoft is also well positioned to build a successful VR headset since they control the enterprise productivity software market and can parlay that into hardware employers will buy for their VR meetings. Combining their exclusive games and employer sponsored headsets could lead to Microsoft dominating the VR market. So really I think the synergy between microsoft and activision is where a lot of the price comes from as opposed to the actual cash flow that activision brings in.
throwawaylinux 5y ago
There's really very little "innovation" in the ARM ISA. Or any ISA these days. It is an API. ARMv8 is nice but it's just warmed over RISC -- actually a lot of things that differentiated previous ARM ISAs were removed to make it more like a standard RISC! The value they add is basically nothing except holding the key to being compatible with ARM ecosystem. At this point extracting their tax on their proprietary ISA is close to rent seeking. That drag on the market is why people are looking to real open ISAs. EDIT: That's not to take away from what architects (ISA designers) do. It's extremely difficult to develop precise and consistent ISAs especially when things like memory ordering, interrupts, pipelined execution, TLBs, etc come in to play. And they are gradually gradually adding features and improving. But this is not value to the tune of over half a billion dollars per year just for ARM licensing (then imagine x86 equivalent numbers for that very locked in ecosystem). ARM is not in a rosy place with their ISA. Their biggest customers like Apple can and will lift and shift their entire ecosystem if ARM do what it's told. Android could start supporting other ISAs too if someone was motivated enough. And many of ARM's new customers outside the traditional low end embedded world (e.g., in servers) who have been the first ones to move to ARM have done so because their software stacks are very portable. This means they can relatively easily move off ARM as well. Their logic designs for high performance CPUs don't seem to be top tier either. Not to say that in a disparaging way but for example the PA Semi team Apple bought blew past ARM's high performance mobile designs with their very first ARM core. https://www.anandtech.com/show/6330/the-iphone-5-review/ https://www.anandtech.com/show/6330/the-iphone-5-review/ ARM is pretty decent but behind the likes of Intel, AMD, Apple for high performance cores. So if the ARM market gets bigger and more lucrative especially in the server space, they are vulnerable to other companies selling their own chips and cutting ARM's designs out of the high margin sales. Amazon could be designing their own core right now to use in their ARM servers in a few generations for example. Just as Apple did with its iphone chips. AMD could start making ARM server CPUs if that's where the money is.
- floatboth 5y ago
  > Amazon could be designing their own core right now Would require an architectural license and lots of talent and time. Getting stock Neoverse cores is an incredible deal for them, this is probably a big part of the reason they can offer cheaper services from their chips. Arm cores aren't really all that behind, there are just tendencies for wildly incorrect comparisons (past Arm cores vs upcoming competition cores, scale-targeted configurations vs workstation-targeted ones, etc.)
fomine3 5y ago
I was surprised how Activision/Blizzard valuation big. Anyway because they earn $$$ from game.

by awill 5y ago

It seems crazy to me that Blizzard/Activision is worth more than Arm. I get BA has tons of world-famous games, but almost every phone on earth is Arm. Arm is taking over laptops and servers too.

JumpCrisscross 5y ago

> almost every phone on earth is Arm. Arm is taking over laptops too. Is there a RISC-V analog to Blizzard/Activision?

jdhawk 5y ago
SiFive?
Cyph0n 5y ago
Ubisoft?
throwaway946513 5y ago
Indie developers?
mhh__ 5y ago
Is there a RISC-V analog to ARM? They're simply not in the same league (yet).

__s 5y ago

I imagine Blizzard would be worth less if all their IP was licensed out to other large game studios with very liberal terms

stefan_ 5y ago
And everyone actually making competitive products was doing so because of their own extensions, not whatever Blizzard did.
mrandish 5y ago
Yes, that's a big reason why the valuations are different. ARM's designs being so central to the products of so many companies has occurred only because of ARM's licensing terms being so liberal, including things like forward pricing caps, MFN clauses, etc. They basically chose to trade away pricing power (hence margin) for ubiquity and longer-term relationships.
easton_s 5y ago
This is the current LucasFilm Games model. No more artists, only managers and sales who have no true vision for their IP.

ashtonkem 5y ago

This is one of those arguments that the stock market doesn't really align value with social need. Making games is good and all, people like and need entertainment, but from a social perspective we need ARM more than we need Activision.

missedthecue 5y ago
The stock market (attempts to) align value with future projected cashflows, not social need. I don't believe it's ever been the case that social need was part of the equation, particularly given that it's such a subjective measure.
mr_toad 5y ago
We need water more than we need diamonds.

thrwyoilarticle 5y ago

Arm has an unusually high relevance/value ratio. As Softbank found out, you can't just ramp up the licence costs. It's also not as scalable as software and doesn't have the revenue of the hardware licensees. I wish it would be bought by an open consortium to protect the millenia of engineering hours from snatch-and-grabs like these or the tyranny of uninformed investors but FAANG et al passed up the chance to secure their computing future last time. They've been blessed with another chance, hopefully this debacle has been eye opening. I wouldn't be surprised if Arm employees create more value for other companies than they do for Arm.

klelatti 5y ago
Great comment and your last para is undoubtedly true. Really surprised that the hyperscalers don’t see the value in investing in Arm to develop competitive server / cloud CPUs.
01100011 5y ago
> open consortium You expect an open consortium to continue to innovate in an industry leading way? An open consortium is how you kill ARM. ARM didn't get where it is now by being sub-par. I appreciate your intent and it seems like a nice idea, but my experience with community development means ARM would turn into an absolute shit show as various stakeholders fight for control and ram through a mish-mash of their pet personal features.
- SV_BubbleTime 5y ago
  Everytime I see someone recommend a special interest group or consortium… I think of Bluetooth and it’s literally thousands of pages spec. Then when they have the chance to almost completely start over… the make BLE with approximately 1/2 of what people want and spend years bloating the spec on that too. I’ll take a talented lunatic with autonomy over 20 different voices in a bureaucratic community every time.
  - thrwyoilarticle 5y ago
    And how many PCI-E cards do you think this comment took to reach my screen?

mbesto 5y ago

I like this quote about entertainment: "Two weeks ago, at the Code Conference, Endeavor CEO Ari Emanuel claimed “the total addressable market of content is infinite.” Netflix is spending $17 billion a year to validate his thesis. So far, they’re both right." https://www.profgalloway.com/stream-on-2/ https://www.profgalloway.com/stream-on-2/

sydthrowaway 5y ago
Consoom

papito 5y ago

As Scott Galloway put it, Call of Duty alone generates $55M a day, as if it were a door-busting Marvel movie opening weekend, all the time.

sydthrowaway 5y ago
And yet gamedevs are paid like crap Who gets the money?
- papito 5y ago
  Let me introduce you to the concept of "shareholder value".
paulmd 5y ago
dang, $20b a year for COD alone? I realize that's the crown jewel in ActiBlizz's portfolio but that does kinda put the acquisition into perspective, you could throw away every single other IP they own (and there are numerous ofc) and Microsoft only paid 2.5y of revenue for COD. $70b is really kinda cheap. (I realize there's some ongoing development costs there - that $20b a year is conditional on you spending $500m a year to make next year's game - but there's also no reason to doubt that revenue stream will continue either. COD is shovelware (it's AAA but you get my meaning) and if you just don't mess it up (BF2042 says hi) then there's no reason to doubt the customers will keep coming back. And again, that's 2.5y revenue of just one asset of a giant company. Cheap cheap cheap.)

colinmhayes 5y ago

Microsoft saw how successful sony's strategy of exclusive games was last generation and is copying it to help their SAASification of the gaming market. Microsoft is also well positioned to build a successful VR headset since they control the enterprise productivity software market and can parlay that into hardware employers will buy for their VR meetings. Combining their exclusive games and employer sponsored headsets could lead to Microsoft dominating the VR market. So really I think the synergy between microsoft and activision is where a lot of the price comes from as opposed to the actual cash flow that activision brings in.

throwawaylinux 5y ago

There's really very little "innovation" in the ARM ISA. Or any ISA these days. It is an API. ARMv8 is nice but it's just warmed over RISC -- actually a lot of things that differentiated previous ARM ISAs were removed to make it more like a standard RISC! The value they add is basically nothing except holding the key to being compatible with ARM ecosystem. At this point extracting their tax on their proprietary ISA is close to rent seeking. That drag on the market is why people are looking to real open ISAs. EDIT: That's not to take away from what architects (ISA designers) do. It's extremely difficult to develop precise and consistent ISAs especially when things like memory ordering, interrupts, pipelined execution, TLBs, etc come in to play. And they are gradually gradually adding features and improving. But this is not value to the tune of over half a billion dollars per year just for ARM licensing (then imagine x86 equivalent numbers for that very locked in ecosystem). ARM is not in a rosy place with their ISA. Their biggest customers like Apple can and will lift and shift their entire ecosystem if ARM do what it's told. Android could start supporting other ISAs too if someone was motivated enough. And many of ARM's new customers outside the traditional low end embedded world (e.g., in servers) who have been the first ones to move to ARM have done so because their software stacks are very portable. This means they can relatively easily move off ARM as well. Their logic designs for high performance CPUs don't seem to be top tier either. Not to say that in a disparaging way but for example the PA Semi team Apple bought blew past ARM's high performance mobile designs with their very first ARM core. https://www.anandtech.com/show/6330/the-iphone-5-review/ https://www.anandtech.com/show/6330/the-iphone-5-review/ ARM is pretty decent but behind the likes of Intel, AMD, Apple for high performance cores. So if the ARM market gets bigger and more lucrative especially in the server space, they are vulnerable to other companies selling their own chips and cutting ARM's designs out of the high margin sales. Amazon could be designing their own core right now to use in their ARM servers in a few generations for example. Just as Apple did with its iphone chips. AMD could start making ARM server CPUs if that's where the money is.

floatboth 5y ago
> Amazon could be designing their own core right now Would require an architectural license and lots of talent and time. Getting stock Neoverse cores is an incredible deal for them, this is probably a big part of the reason they can offer cheaper services from their chips. Arm cores aren't really all that behind, there are just tendencies for wildly incorrect comparisons (past Arm cores vs upcoming competition cores, scale-targeted configurations vs workstation-targeted ones, etc.)

fomine3 5y ago

I was surprised how Activision/Blizzard valuation big. Anyway because they earn $$$ from game.