7 ms·

Outside looking in, this feels like a far more valuable acquisition than Activision for $69B. Call of Duty is valuable, but Microsoft has already said they don

by 015a 5y ago

Outside looking in, this feels like a far more valuable acquisition than Activision for $69B. Call of Duty is valuable, but Microsoft has already said they don't intend to remove it from PlayStation. That could change, but so could CoD's importance to the video gaming industry as a whole: its popularity has dropped with essentially every release since BLOPS2. Outside of CoD: AB is a shadow of its former self; IMO the second most valuable IP suite in the history of gaming (first: Nintendo), but years of failed projects, brain drain, and poor employee culture make acting on that IP difficult. Halo 4, 5, and Infinite have suggested that Xbox can keep dying IP on life support, but reclaiming the glory of Blizzard's past likely isn't in the cards, at least on the medium term. In comparison: Sony paid 20x less for Bungie. What they lack in variety of products, they make up for in, in my view, Potential. Destiny is a great franchise, with lots of fans. The team brings rock solid FPS dev & netcode experience (something Sony's first party studios are at a deficit for). This spectacularly echos previous acquisitions from both companies. Microsoft buys Halo, Gears, Bethesda, AB; all "glory day IP" acquisitions with demonstrated historical mega-success, but weaker more recent market success. Sony goes smaller; Bluepoint, Housemarque, and Bungie; but despite being smaller names, these companies have far more demonstrable ability to produce triple-A content, tomorrow. In other words; Microsoft is looking for name recognition to sell Game Pass; Sony is looking for talent, which the PlayStation name recognition and marketing machine can wring success out of. Most recent tactile example: Returnal was a massive success despite being in a very niche genre, which directly led to Housemarque's acquisition. Its hard to imagine it seeing the same success on Xbox, especially since Xbox did have an exclusive, in a different genre, but with rather similar vibes, release around the same time (The Medium). It was, to my eyes, a market failure (but, of course, I have no insider info). I don't like centralization. But it is interesting to see these two different strategies play out.

HWR_14 5y ago
Microsoft didn't buy Halo. They bought Bungie, then used them to make Halo. They spin them off, keeping then Halo franchise. Okay, technically Bungie was working on a RTS game called Halo when MS bought them, but it was after the purchase it shifted genres and found its groove. In other words, this "echo" isn't really what you are saying.
- Fuzzwah 5y ago
  Halo was most certainly an FPS before MS bought Bungie. https://youtu.be/ebI5lkLRTdg https://youtu.be/ebI5lkLRTdg
  - w4rh4wk5 5y ago
    True, but it was initially supposed to be an RTS, just a bit longer before Microsoft stepped in.
    - mig39 5y ago
      Did you watch the video? It was basically complete before Microsoft bought it. They then ported it to Xbox. It may have been an RTS initially, but when Microsoft bought Bungie, it was already "Combat Evolved" and near release.
      - EA 5y ago
        HALO was originally based on Myth. That is when Halo was briefly (conceptually) an RTS. It evolved into a Third Person Shooter, and finally First Person Shooter. After Bungie was acquired by Microsoft, they had a year to make their game, so they made the decision to start over from the beginning and create Halo as a first person shooter.
        mig39 5y ago
        Honestly, that would have been awesome! I loved Myth and Myth II. A space-based one would have been great. I don't understand the timeline, though, as the videos shown at MacWorld in 1999 (before Microsoft), show Halo as a first-person shooter. The video is linked above. I think it was a FPS long before Microsoft was interested. I think Microsoft bought it specifically because of the FPS game.
      - w4rh4wk5 5y ago
        Believe me, I don't need to watch that video. I've been there ;) A lot of development happened right before Combat Evolved got released due to Microsoft injecting a lot of money. It wasn't just an Xbox port of an already finished game. Look at the E3 2000 trailer which is pretty much what has been shown at Macworld the year before. Combat Evolved looked quite different when it came out a year later. Note that Microsoft acquired Bungie in 2000.
w4rh4wk5 5y ago
> these companies have far more demonstrable ability to produce triple-A content I am not so sure. At least not for Bungie. I haven't enjoyed Destiny at all. Where on the other side, Arkane's Dishonored and Prey are quite good. So are id Software's Doom, Doom Eternal, and Wolfenstein. Fallout 4 was okay as well.
- 015a 5y ago
  Sure; and the unfortunate reality is, Fallout 4 was released nearly 8 years ago. Dishonored: 10. Dishonored 2: 6. id definitely puts out super solid stuff, consistently. Arkane is also in that bucket (Deathloop is the better example to judge recent efficacy of the team, not Dishonored/Prey. And its great). But, that is counterbalanced by... Fallout 76? Warcraft 3 Reforged? The state of WoW, Overwatch, and Heroes? Xbox's acquisitions are a semitruck full of companies. The good parts of that truck are good. The bad parts are... quite bad. But the bad parts are built on really strong IP, which carried its own high price tag. So the question becomes; they'll definitely get value out of Arkane, id, and CoD, zero question there; but will they get value out of the rest of the ~$76B combined they spent, when so much of it is in glory-day IPs and not in teams, employed today, that can execute on that IP to deliver awesome content (no disrespect intended to the teams who do work on that content today; but reality is in the metrics, revenue, etc)? Comparatively: Microsoft bought a semi-truck, Sony bought a Miata. It's not the fastest car out there. It's not for everyone. But it has its users and there's no question as to Mazda's ability to put out another stellar model, nor question around whether customers will buy it. Plus: very affordable. Ok, that's a bad analogy.
  - redisman 5y ago
    Warcraft and Diablo are still great IPs. Some of the best. If D4 will be good that can have staying power for a decade easily. Same with whatever RPG comes from the Warcraft universe next
  - w4rh4wk5 5y ago
    > Fallout 4 was released nearly 8 years ago. Dishonored: 10. Dishonored 2: 6 This sounds like a long time, but it's not in game development. Putting out a solid title requires multiple years of development. > Deathloop is the better example to judge recent efficacy of the team Deathloop isn't on par with Arkane's previous games. It didn't even sell that well. They put it on sale a few weeks after launch to issue damage control.
sylens 5y ago
> In comparison: Sony paid 20x less for Bungie. What they lack in variety of products, they make up for in, in my view, Potential. Destiny is a great franchise, with lots of fans. The team brings rock solid FPS dev & netcode experience (something Sony's first party studios are at a deficit for). I disagree. Destiny may have once had potential, but Bungie is a studio that continually shoots itself in the foot. Just like with Halo, they threw out years of work for the first Destiny and essentially stitched together a frankenstein of the parts to ship on time. It's why the story has never made sense, even as they try to retcon various pieces to fit into a much longer narrative. The game has also lost some of its early "looter shooter with friends" charm and become a grindfest that feels like a job at times, with content that is sunset only 2-3 years after it is sold to consumers. Destiny 2 is also extremely hostile to new players, bombarding them with dozens of vendors, currencies, and no clear sense of where to start and how to begin grokking the story. The original campaign has been sunset so if you never played before, you will be missing the equivalent of the first movie of a trilogy in terms of plot and characters. My hope for this acquisition is that it lets them course correct the design of whatever they do next because I feel that Destiny 2 is in decline.
- samsgro 5y ago
  Generally agree, but on the other hand, the game feels a LOT better since since the Activision divestment. In the last 12 months narrative team of Destiny 2 have REALLY knocked it out of the park, with the seasonal plot actually making sense and having some interesting activities (like Battlegrounds). Some significant improvements in QoL too. While there definitely gaps as you say - the New Light experience in particular needs some serious work - so long as Sony lets the team continue on its current trajectory, there may be hope.
  - sylens 5y ago
    I agree that the seasonal storytelling is better but they have a very real problem with the game becoming Bounty Collector. They also have basically abandoned Crucible, which makes me think the new IP is where all their top PvP talent is currently.
wklauss 5y ago
> Sony paid 20x less for Bungie. What they lack in variety of products, they make up for in, in my view, Potential. Not really. Destiny has a smaller audience than CoD, and Activision Blizzard is a huge purchase with lots a of valuable IPs that go beyond CoD and can still grow (Bungie, OTOH, currently only has Destiny in it's catalog). Bungie revenue was estimated around $300 million for 2019 vs. $6,5b for Activision Blizzard, so price seems to be in line for both purchases, around 8x annual rev. Keep in mind Microsoft has bought ton of small studios as well! (Rare, Playground). Returnal is a good title, but far from being a success by AAA standards (last time they reported sales of the game, in June 2021. it was 560.000 copies). I think part of the aura of success comes from being one of the very few exclusive titles created specifically for the PS5.
- 015a 5y ago
  Its important to put the Returnal numbers in context: it was never supposed to be a triple-A hit. Housemarque is a small (50-100 people) studio that traditionally made top-down or side-scrolling bullet hell shooters; they developed Returnal without being under the PSS banner (though certainly with financial support for the exclusive title); and it has sold 500k+ copies. Compare that to Rift Apart, which last I heard is more in the 1-2M sales range. Insomniac is a true triple-A studio, with more like 400-500 employees plus the full development support of PSS's shared resources. Ratchet & Clank is a more broadly known franchise, in a genre and aesthetic that is more age and demographic accessible. Additionally, while this would equally affect Returnal & Rift Apart; PS5 shortages do dampen all PS5 exclusive game sales compared to more broadly available titles. Within that context, it's clear to me that Returnal was a tremendous success. Not a Triple-A success, but its not all about raw sales at the end of the day. Cost to produce also needs to be considered. To be clear: I absolutely believe Xbox isn't just "all triple-A all the time". They have the triple-A teams. They have the smaller teams (Maybe not Rare/Playground as they're huge nowadays, but: Ninja Theory, Compulsion, Double Fine, World's Edge, maybe even Obsidian, plus their exclusivity deals with Moon and Asobo). Its more-so a discussion about their recent acquisitions strategy.
MangoCoffee 5y ago
>In comparison: Sony paid 20x less for Bungie. What they lack in variety of products, they make up for in, in my view, Potential. Destiny is a great franchise Strongly disagree. Bungie have one IP. while AB have many well know IPs. Blizzard proven, you can make a new game out of old IP. Warcraft is used to make Hearthstone the card game. you are comparing one franchise IP to multiple franchise IPs and claiming Bungie is a better deal. that just stretching it.
mdasen 5y ago
It feels the opposite way to me. Microsoft bought a company with an extensive suite of IP that publishes a lot of games. Sony panicked and bought a company that has one franchise (Destiny). When looking at Disney, I see a company that has bought a lot of deep IP catalogues. They've used that to really propel their future and get high-value talent that wants to work in those universes with a Disney-sized budget to tell their stories. Activision Blizzard may have cost 20x more, but Activision is really profitable with a P/E ratio of 26 (at the $69B deal price). Microsoft's P/E is 33, Google's is 26, Apple's is 29, Amazon's is 58, and Netflix is 38 (even with the tumble in price). So Microsoft bought Activision relatively cheap compared to its earnings. Bungie is private so we don't really know what their finances are like. Activision's cheap price means that there isn't a lot of risk for Microsoft. Maybe you believe that Activision is about to crater and no one will want their games in the future. It's possible. It's also possible that everyone is going to get tired of the extensive IP catalogues that Disney has assembled. However, when the price is that reasonable, you don't need the same explosive growth to justify the investment. So Microsoft bought a business that even if it just keeps performing as-usual will be a fine addition to Microsoft. It also has the potential to be huge for Microsoft with a deep IP catalogue, the potential for Xbox exclusives to help launch the next-gen Xbox when the time comes, the potential for cost savings with Azure infrastructure, and probably more that I'm not thinking of. If Sony buys Bungie and just lets them do their thing, they might get some good games. But it seems like Microsoft wants to buy and pour some money in which seems like a recipe for bigger successes. We've seen it with some of Microsoft's recent purchases. They've poured money into GitHub and made it an even bigger platform. They've poured money into .NET Core and Xamarin/Mono to recapture developer mindshare. It seems like Microsoft is likely to take similar steps with their Activision purchase - and similar steps that Disney has taken with their IP catalogue. It's possible that the small places Sony has bought have better potential, but Activision Blizard is a profitable company at a relatively cheap price which means that the purchase carries relatively low risk while still offering a lot of upside for Microsoft.
- sensitivefrost 5y ago
  "Sony panicked and bought a company that has one franchise (Destiny)." If you think Sony turned around and bought Bungie in the 2 weeks since the Acti-Blizz acquisition was announced, I dunno what to tell you.
moogleii 5y ago
I think Microsoft's play was to further strengthen Game Pass to the point that Sony can't deny it on their platform anymore (or at least make it hurt more to continue doing so). It makes sense that MS won't remove games from Sony's access, but it does give them more levers to play with. "Hey this game is 'free' on Game Pass (PC + XBox). You can still buy it for PlayStation, though." And Sony's move is simply a defense against that.
- grogenaut 5y ago
  I have PC Game Pass ultimate. The only thing I've used it for is Halo. The games that I got for "free" on it I actually bought elsewhere and added up to less than I spent on ultimate, even new games like DeathLoop. I've spent about 80 on the games I could play from game pass, it's like $180/year (I paid less through friends at MS). Took me a 2 months to finish death loop, cost me $30 on steam sale, that's break even. They've crippled several indy games, for instance astroneer, to only play on supported premium servers, that cost my friend (with gamepass) $30 that he could have just purchased astroneer on (and just run server locally or a linode). So far while game pass seems cool it's not really panning out monetarily for me. Other than these big studios that MS built, the rest of the game pass catalog would be easy for sony to pick up on their own game pass. I'll also note that no one seems to be talking about nintendo, who also has a great stable of titles, needs to take on game pass. Sony and Nintendo's exclusive catalogs are in the same ballpark (if very different). Microsoft also loses out on the console money, since why would I buy a console when I have this gaming pc that's much better? So makes sense for me to just buy the PC games and a PS5, that and my switch has me covered.
  - colinmhayes 5y ago
    > So far while game pass seems cool it's not really panning out monetarily for me. Which is why microsoft spent $100 billion on studios this year. Zenimax and AB consistently put out hugely popular games, and I expect microsoft will continue buying.
    - grogenaut 5y ago
philistine 5y ago
Mobile gaming invalidates all your argumentation. Activision Blizzard King has a large and successful mobile business that makes more money than anything you've described here. Bungie has none of that, which explains its far lower price.
hlbjhblbljib 5y ago
What is AB?
- generalpf 5y ago
  Activision Blizzard
scarface74 5y ago
You’re forgetting about how profitable (and disgusting) Activision’s mobile play to win games are. Besides, MS needs content for its subscription gaming service. It’s not like consoles themselves are profitable. They are just a means to deliver games to users.
- sk0g 5y ago
  Not sure what's wrong with games being "pay to win", isn't that the point of them? Unless you meant pay to win, or the newer and weirder version, play to earn.
  - scarface74 5y ago
    Pay to win mobile games with in app purchases like Candy Crush with in app purchases
    - sk0g 5y ago
      Ah I stuffed up, the parent comment said play to win, which sounds like how games should be?
  - LandR 5y ago
    I think they mean where you have a competitive multiplayer content but players who spend more on DLC have an advantage over players who spend less.
  - AtlasBarfed 5y ago
    PtW games I've seen use - social manipulation from fake players to employ peer pressure, membership, and others to extract revenues - employees masquerading as players to stir up conflict that gets people to pay money to support the "guild war" - employees masquerading as players that target free or low revenue players to get them to pay to survive/not be harassed. - have outright gambling with attendant neurologically tuned payouts like slot machines All told these are "games" in the sense that blackjack and poker and other gambling pursuits that prey on neurological reward systems are "games". Except they lump on social networking manipulation and group dynamics to further revenue extraction. And they aren't nearly regulated to the degree that casino games are. The games I've described are Machine Zone and other of their ilk that are the worst offenders, but their revenue has forced practically all vendors of video entertainment to consider using their tactics to "enhance shareholder value".
cletus 5y ago
> Call of Duty is valuable, but Microsoft has already said they don't intend to remove it from PlayStation. They haven't said that. They have said they will honor their existing contracts [1]. That's not permanent guarantee. I'm not saying they'll pull it as soon as they can but it gives them a lot of power. I'm not sure you realize just how big the CoD franchise is. It pulls in billions of dollars every year by itself. As for Blizzard, yes the company has seen better days but their IP is still valuable. Diablo 4 whenever it comes out will sell a ton of copies. [1]: https://www.theverge.com/2022/1/20/22892860/sony-microsoft-activision-blizzard-acquisition-comment-response https://www.theverge.com/2022/1/20/22892860/sony-microsoft-a...
vmception 5y ago
> Call of Duty is valuable, but Microsoft has already said they don't intend to remove it from PlayStation. Maybe printing free revenue from the franchise is more valuable than printing revenue with high overhead console sales :)
kjkjadksj 5y ago
Microsoft made a big mistake not just buying bungie after halo reach. The franchise and the studio were both at their very peak at this point. 343 is just not the developer bungie is and fans have been feeling for years that 343 has squandered their position. A lot of players to this day strictly play the bungie era games on master chief collection, and that release took a long time for it to be fixed from its broken state on release

by 015a 5y ago

HWR_14 5y ago

Microsoft didn't buy Halo. They bought Bungie, then used them to make Halo. They spin them off, keeping then Halo franchise. Okay, technically Bungie was working on a RTS game called Halo when MS bought them, but it was after the purchase it shifted genres and found its groove. In other words, this "echo" isn't really what you are saying.

Fuzzwah 5y ago
Halo was most certainly an FPS before MS bought Bungie. https://youtu.be/ebI5lkLRTdg https://youtu.be/ebI5lkLRTdg
- w4rh4wk5 5y ago
  True, but it was initially supposed to be an RTS, just a bit longer before Microsoft stepped in.
  - mig39 5y ago
    Did you watch the video? It was basically complete before Microsoft bought it. They then ported it to Xbox. It may have been an RTS initially, but when Microsoft bought Bungie, it was already "Combat Evolved" and near release.
    - EA 5y ago
      HALO was originally based on Myth. That is when Halo was briefly (conceptually) an RTS. It evolved into a Third Person Shooter, and finally First Person Shooter. After Bungie was acquired by Microsoft, they had a year to make their game, so they made the decision to start over from the beginning and create Halo as a first person shooter.
      - mig39 5y ago
        Honestly, that would have been awesome! I loved Myth and Myth II. A space-based one would have been great. I don't understand the timeline, though, as the videos shown at MacWorld in 1999 (before Microsoft), show Halo as a first-person shooter. The video is linked above. I think it was a FPS long before Microsoft was interested. I think Microsoft bought it specifically because of the FPS game.
    - w4rh4wk5 5y ago
      Believe me, I don't need to watch that video. I've been there ;) A lot of development happened right before Combat Evolved got released due to Microsoft injecting a lot of money. It wasn't just an Xbox port of an already finished game. Look at the E3 2000 trailer which is pretty much what has been shown at Macworld the year before. Combat Evolved looked quite different when it came out a year later. Note that Microsoft acquired Bungie in 2000.

w4rh4wk5 5y ago

> these companies have far more demonstrable ability to produce triple-A content I am not so sure. At least not for Bungie. I haven't enjoyed Destiny at all. Where on the other side, Arkane's Dishonored and Prey are quite good. So are id Software's Doom, Doom Eternal, and Wolfenstein. Fallout 4 was okay as well.

015a 5y ago
Sure; and the unfortunate reality is, Fallout 4 was released nearly 8 years ago. Dishonored: 10. Dishonored 2: 6. id definitely puts out super solid stuff, consistently. Arkane is also in that bucket (Deathloop is the better example to judge recent efficacy of the team, not Dishonored/Prey. And its great). But, that is counterbalanced by... Fallout 76? Warcraft 3 Reforged? The state of WoW, Overwatch, and Heroes? Xbox's acquisitions are a semitruck full of companies. The good parts of that truck are good. The bad parts are... quite bad. But the bad parts are built on really strong IP, which carried its own high price tag. So the question becomes; they'll definitely get value out of Arkane, id, and CoD, zero question there; but will they get value out of the rest of the ~$76B combined they spent, when so much of it is in glory-day IPs and not in teams, employed today, that can execute on that IP to deliver awesome content (no disrespect intended to the teams who do work on that content today; but reality is in the metrics, revenue, etc)? Comparatively: Microsoft bought a semi-truck, Sony bought a Miata. It's not the fastest car out there. It's not for everyone. But it has its users and there's no question as to Mazda's ability to put out another stellar model, nor question around whether customers will buy it. Plus: very affordable. Ok, that's a bad analogy.
- redisman 5y ago
  Warcraft and Diablo are still great IPs. Some of the best. If D4 will be good that can have staying power for a decade easily. Same with whatever RPG comes from the Warcraft universe next
- w4rh4wk5 5y ago
  > Fallout 4 was released nearly 8 years ago. Dishonored: 10. Dishonored 2: 6 This sounds like a long time, but it's not in game development. Putting out a solid title requires multiple years of development. > Deathloop is the better example to judge recent efficacy of the team Deathloop isn't on par with Arkane's previous games. It didn't even sell that well. They put it on sale a few weeks after launch to issue damage control.

sylens 5y ago

> In comparison: Sony paid 20x less for Bungie. What they lack in variety of products, they make up for in, in my view, Potential. Destiny is a great franchise, with lots of fans. The team brings rock solid FPS dev & netcode experience (something Sony's first party studios are at a deficit for). I disagree. Destiny may have once had potential, but Bungie is a studio that continually shoots itself in the foot. Just like with Halo, they threw out years of work for the first Destiny and essentially stitched together a frankenstein of the parts to ship on time. It's why the story has never made sense, even as they try to retcon various pieces to fit into a much longer narrative. The game has also lost some of its early "looter shooter with friends" charm and become a grindfest that feels like a job at times, with content that is sunset only 2-3 years after it is sold to consumers. Destiny 2 is also extremely hostile to new players, bombarding them with dozens of vendors, currencies, and no clear sense of where to start and how to begin grokking the story. The original campaign has been sunset so if you never played before, you will be missing the equivalent of the first movie of a trilogy in terms of plot and characters. My hope for this acquisition is that it lets them course correct the design of whatever they do next because I feel that Destiny 2 is in decline.

samsgro 5y ago
Generally agree, but on the other hand, the game feels a LOT better since since the Activision divestment. In the last 12 months narrative team of Destiny 2 have REALLY knocked it out of the park, with the seasonal plot actually making sense and having some interesting activities (like Battlegrounds). Some significant improvements in QoL too. While there definitely gaps as you say - the New Light experience in particular needs some serious work - so long as Sony lets the team continue on its current trajectory, there may be hope.
- sylens 5y ago
  I agree that the seasonal storytelling is better but they have a very real problem with the game becoming Bounty Collector. They also have basically abandoned Crucible, which makes me think the new IP is where all their top PvP talent is currently.

wklauss 5y ago

> Sony paid 20x less for Bungie. What they lack in variety of products, they make up for in, in my view, Potential. Not really. Destiny has a smaller audience than CoD, and Activision Blizzard is a huge purchase with lots a of valuable IPs that go beyond CoD and can still grow (Bungie, OTOH, currently only has Destiny in it's catalog). Bungie revenue was estimated around $300 million for 2019 vs. $6,5b for Activision Blizzard, so price seems to be in line for both purchases, around 8x annual rev. Keep in mind Microsoft has bought ton of small studios as well! (Rare, Playground). Returnal is a good title, but far from being a success by AAA standards (last time they reported sales of the game, in June 2021. it was 560.000 copies). I think part of the aura of success comes from being one of the very few exclusive titles created specifically for the PS5.

015a 5y ago
Its important to put the Returnal numbers in context: it was never supposed to be a triple-A hit. Housemarque is a small (50-100 people) studio that traditionally made top-down or side-scrolling bullet hell shooters; they developed Returnal without being under the PSS banner (though certainly with financial support for the exclusive title); and it has sold 500k+ copies. Compare that to Rift Apart, which last I heard is more in the 1-2M sales range. Insomniac is a true triple-A studio, with more like 400-500 employees plus the full development support of PSS's shared resources. Ratchet & Clank is a more broadly known franchise, in a genre and aesthetic that is more age and demographic accessible. Additionally, while this would equally affect Returnal & Rift Apart; PS5 shortages do dampen all PS5 exclusive game sales compared to more broadly available titles. Within that context, it's clear to me that Returnal was a tremendous success. Not a Triple-A success, but its not all about raw sales at the end of the day. Cost to produce also needs to be considered. To be clear: I absolutely believe Xbox isn't just "all triple-A all the time". They have the triple-A teams. They have the smaller teams (Maybe not Rare/Playground as they're huge nowadays, but: Ninja Theory, Compulsion, Double Fine, World's Edge, maybe even Obsidian, plus their exclusivity deals with Moon and Asobo). Its more-so a discussion about their recent acquisitions strategy.

MangoCoffee 5y ago

>In comparison: Sony paid 20x less for Bungie. What they lack in variety of products, they make up for in, in my view, Potential. Destiny is a great franchise Strongly disagree. Bungie have one IP. while AB have many well know IPs. Blizzard proven, you can make a new game out of old IP. Warcraft is used to make Hearthstone the card game. you are comparing one franchise IP to multiple franchise IPs and claiming Bungie is a better deal. that just stretching it.

mdasen 5y ago

It feels the opposite way to me. Microsoft bought a company with an extensive suite of IP that publishes a lot of games. Sony panicked and bought a company that has one franchise (Destiny). When looking at Disney, I see a company that has bought a lot of deep IP catalogues. They've used that to really propel their future and get high-value talent that wants to work in those universes with a Disney-sized budget to tell their stories. Activision Blizzard may have cost 20x more, but Activision is really profitable with a P/E ratio of 26 (at the $69B deal price). Microsoft's P/E is 33, Google's is 26, Apple's is 29, Amazon's is 58, and Netflix is 38 (even with the tumble in price). So Microsoft bought Activision relatively cheap compared to its earnings. Bungie is private so we don't really know what their finances are like. Activision's cheap price means that there isn't a lot of risk for Microsoft. Maybe you believe that Activision is about to crater and no one will want their games in the future. It's possible. It's also possible that everyone is going to get tired of the extensive IP catalogues that Disney has assembled. However, when the price is that reasonable, you don't need the same explosive growth to justify the investment. So Microsoft bought a business that even if it just keeps performing as-usual will be a fine addition to Microsoft. It also has the potential to be huge for Microsoft with a deep IP catalogue, the potential for Xbox exclusives to help launch the next-gen Xbox when the time comes, the potential for cost savings with Azure infrastructure, and probably more that I'm not thinking of. If Sony buys Bungie and just lets them do their thing, they might get some good games. But it seems like Microsoft wants to buy and pour some money in which seems like a recipe for bigger successes. We've seen it with some of Microsoft's recent purchases. They've poured money into GitHub and made it an even bigger platform. They've poured money into .NET Core and Xamarin/Mono to recapture developer mindshare. It seems like Microsoft is likely to take similar steps with their Activision purchase - and similar steps that Disney has taken with their IP catalogue. It's possible that the small places Sony has bought have better potential, but Activision Blizard is a profitable company at a relatively cheap price which means that the purchase carries relatively low risk while still offering a lot of upside for Microsoft.

sensitivefrost 5y ago
"Sony panicked and bought a company that has one franchise (Destiny)." If you think Sony turned around and bought Bungie in the 2 weeks since the Acti-Blizz acquisition was announced, I dunno what to tell you.

moogleii 5y ago

I think Microsoft's play was to further strengthen Game Pass to the point that Sony can't deny it on their platform anymore (or at least make it hurt more to continue doing so). It makes sense that MS won't remove games from Sony's access, but it does give them more levers to play with. "Hey this game is 'free' on Game Pass (PC + XBox). You can still buy it for PlayStation, though." And Sony's move is simply a defense against that.

grogenaut 5y ago
I have PC Game Pass ultimate. The only thing I've used it for is Halo. The games that I got for "free" on it I actually bought elsewhere and added up to less than I spent on ultimate, even new games like DeathLoop. I've spent about 80 on the games I could play from game pass, it's like $180/year (I paid less through friends at MS). Took me a 2 months to finish death loop, cost me $30 on steam sale, that's break even. They've crippled several indy games, for instance astroneer, to only play on supported premium servers, that cost my friend (with gamepass) $30 that he could have just purchased astroneer on (and just run server locally or a linode). So far while game pass seems cool it's not really panning out monetarily for me. Other than these big studios that MS built, the rest of the game pass catalog would be easy for sony to pick up on their own game pass. I'll also note that no one seems to be talking about nintendo, who also has a great stable of titles, needs to take on game pass. Sony and Nintendo's exclusive catalogs are in the same ballpark (if very different). Microsoft also loses out on the console money, since why would I buy a console when I have this gaming pc that's much better? So makes sense for me to just buy the PC games and a PS5, that and my switch has me covered.
- colinmhayes 5y ago
  > So far while game pass seems cool it's not really panning out monetarily for me. Which is why microsoft spent $100 billion on studios this year. Zenimax and AB consistently put out hugely popular games, and I expect microsoft will continue buying.
  - grogenaut 5y ago

philistine 5y ago

Mobile gaming invalidates all your argumentation. Activision Blizzard King has a large and successful mobile business that makes more money than anything you've described here. Bungie has none of that, which explains its far lower price.

hlbjhblbljib 5y ago

What is AB?

generalpf 5y ago
Activision Blizzard

scarface74 5y ago

You’re forgetting about how profitable (and disgusting) Activision’s mobile play to win games are. Besides, MS needs content for its subscription gaming service. It’s not like consoles themselves are profitable. They are just a means to deliver games to users.

sk0g 5y ago
Not sure what's wrong with games being "pay to win", isn't that the point of them? Unless you meant pay to win, or the newer and weirder version, play to earn.
- scarface74 5y ago
  Pay to win mobile games with in app purchases like Candy Crush with in app purchases
  - sk0g 5y ago
    Ah I stuffed up, the parent comment said play to win, which sounds like how games should be?
- LandR 5y ago
  I think they mean where you have a competitive multiplayer content but players who spend more on DLC have an advantage over players who spend less.
- AtlasBarfed 5y ago
  PtW games I've seen use - social manipulation from fake players to employ peer pressure, membership, and others to extract revenues - employees masquerading as players to stir up conflict that gets people to pay money to support the "guild war" - employees masquerading as players that target free or low revenue players to get them to pay to survive/not be harassed. - have outright gambling with attendant neurologically tuned payouts like slot machines All told these are "games" in the sense that blackjack and poker and other gambling pursuits that prey on neurological reward systems are "games". Except they lump on social networking manipulation and group dynamics to further revenue extraction. And they aren't nearly regulated to the degree that casino games are. The games I've described are Machine Zone and other of their ilk that are the worst offenders, but their revenue has forced practically all vendors of video entertainment to consider using their tactics to "enhance shareholder value".

cletus 5y ago

> Call of Duty is valuable, but Microsoft has already said they don't intend to remove it from PlayStation. They haven't said that. They have said they will honor their existing contracts [1]. That's not permanent guarantee. I'm not saying they'll pull it as soon as they can but it gives them a lot of power. I'm not sure you realize just how big the CoD franchise is. It pulls in billions of dollars every year by itself. As for Blizzard, yes the company has seen better days but their IP is still valuable. Diablo 4 whenever it comes out will sell a ton of copies. [1]: https://www.theverge.com/2022/1/20/22892860/sony-microsoft-activision-blizzard-acquisition-comment-response https://www.theverge.com/2022/1/20/22892860/sony-microsoft-a...

vmception 5y ago

> Call of Duty is valuable, but Microsoft has already said they don't intend to remove it from PlayStation. Maybe printing free revenue from the franchise is more valuable than printing revenue with high overhead console sales :)

kjkjadksj 5y ago

Microsoft made a big mistake not just buying bungie after halo reach. The franchise and the studio were both at their very peak at this point. 343 is just not the developer bungie is and fans have been feeling for years that 343 has squandered their position. A lot of players to this day strictly play the bungie era games on master chief collection, and that release took a long time for it to be fixed from its broken state on release