Support NeoGAF

[DeltaPolarBear]

Sony is building a Nintendo like First Party, i wouldn't be surprised if Sony acquires some other medium sized teams that make great games.

3rd party is still important because GaaS but if SONY gets GaaS right internally they become a juggernaut without needing anyone else.

They just need some more studios, like 30-40 of great quality, currently they've like 23-25.

They don't NEED to make their own GAAS though. They get paid from every microtransation for any GAAS that run on their machine. If anything trying to make their own GAAS just cannibalize their income from third parties. Single player games are their 1st party focus because they are not competing with any third party.

GAAS is particularly vulnerable to competition, a player can only play so many at the same time. Microsoft is all in on GAAS, which I believe is a mistake. GAAS is better for third parties who can have a wider audience via being everywhere.

 

[Ronin_7]

They don't NEED to make their own GAAS though. They get paid from every microtransation for any GAAS that run on their machine. If anything trying to make their own GAAS just cannibalize their income from third parties. Single player games are their 1st party focus because they are not competing with any third party.

GAAS is particularly vulnerable to competition, a player can only play so many at the same time. Microsoft is all in on GAAS, which I believe is a mistake. GAAS is better for third parties who can have a wider audience via being everywhere.

They're building alot of those.

 

[DeltaPolarBear]

They're building alot of those.

A lot, yes, and most of them will fail. The world can handle as many AAA single player games as the studios can produce, but there is only so many GAAS that can survive at any one time.

 

[vivftp]

I agree that T2 is the likely target if the ABK. deal closes.

I think T2 is actually a much better buy than CoD. It's easier to make a CoD killer than it is to make a GTA killer and T2 gives you entry into every major sport except for football, but gives you an option to explore football again when the time is right. Red Dead is bigger than all the games you mentioned outside of CoD.

Zynga gives you direct entry into mobile.

If Sony were to buy T2, I see them going directly after the FIFA license as well.

T2 compliments Sony is ways that no other company does.

If they put GTA6 and Red Dead 3 and Red Dead remake exclusively on a PC PlayStation launcher, that gets them immediate entry along with TLOU MP, Gran Turismo 7/VR, e.t.c.

If I'm Sony, I'd go all in on T2, and then still look at CDPR and From Software.

In a hypothetical scenario where Sony goes after a truly large company, there is one company I feel would be far more valuable and worth it for Sony to pursue than Take Two, and that would be Epic Games. They'd have to buy Tim Sweeneys controlling stake and more probably, and of course figure out what do with Tencent and their massive stake in the company. But Epic Games would massively benefit Sony Group more than any other company I can think of. Gaming IP, gaming engine, live service knowledge, film & TV production penetration, a PC store front... Sony Group would massively benefit. It'd cost even more than Take Two, but it'd also be the better option long term IMO.

They'd have to leave everything absolutely 100% independent of course, but that's not a problem. Even then, regulators would be crawling up Sonys asshole over such a deal.

Take Two would be second on my list for truly massive companies they could pursue. In a more realistic scenario though, I think Square Enix still tops my list of who Sony will go after if they should pursue a publisher. They're as close as can be (both historically and currently). Sony Group probably still has somewhere close to 10 billion dollars allocated to spend on M&A between now and the end of March 2024, and Square would easily fit in that budget.

 

[vivftp]

A lot, yes, and most of them will fail. The world can handle as many AAA single player games as the studios can produce, but there is only so many GAAS that can survive at any one time.

If they have 10 live service games utterly fail and only 1 reaches truly mammoth levels of success, then it'll all have been worth it. They're giving themselves the best possible shot at success by tackling live services from different directions with multiple games, and by tapping into the knowledge and experience Bungie has with live service games. No one can predict what will succeed and what won't, which is why they're hedging their bets.

As for the idea that live service games are best left to third parties because they can reach a wider audience, Sony are going to be putting many of their live service games on console and PC, and some will also make it to mobile. They'll have a more than large enough potential userbase. At that point it comes down to how good their game/support is and how the market reacts to it.

 

[Heisenberg007]

Now, give me a few Japanese first party games, you cowards!

Stellar Blade is scheduled for 2023. Death Stranding 2, Lost Souls Aside, and Rise of the Ronin are all expected to hit 2024. All first-party.

You can also add Eternighs and the 2 Final Fantasy games: XVI and Rebirth, if you want just console exclusives. DQ12 and KH4 are also expected to be console exclusives.

That's quite a lot of good stuff, for me at least.

 

[DeltaPolarBear]

As for the idea that live service games are best left to third parties because they can reach a wider audience, Sony are going to be putting many of their live service games on console and PC, and some will also make it to mobile. They'll have a more than large enough potential userbase. At that point it comes down to how good their game/support is and how the market reacts to it.

Sony Music is making bank with the Fate franchise on phones. They just are segregated from Playstation. Very different games need very different teams.

 

[vivftp]

Sony Music is making bank with the Fate franchise on phones. They just are segregated from Playstation. Very different games need very different teams.

SIE are building a mobile team with some quality talent heading it up

Meet PlayStation Mobile: a superteam hired from Apple, Kabam, Meta, Tencent and more - Mobilegamer.biz

PlayStation has quietly been building a brand new mobile division packed with talent. Here’s who’s joined so far.

mobilegamer.biz

They made their first studio acquisition last year with Savage Game Studio. More PS IP will be coming to mobile, including live service games. Bungie has been hiring for mobile devs, so Destiny 2 might see a port, or one of their future games. Also San Diego Studio has been hiring mobile devs, so MLB might also see a port.

 

[ToadMan]

This is what I was thinking. MS just produced 9.5 Million pages ask to why the deal should go through and challenged Sony to counter why the deals shouldn't go through with proof aka documents. These Sony fiscal results won't help their case against MS! Actually, I could see MS adding more docs to the case. "Look at Sony's fiscal numbers just this year" Sony may regret this challenge in court.

I’d say it’s an argument to the opposite.

Sony, Nintendo and many other videogaming companies are making money right now in a tough market. This demonstrates the market is healthy and competition is working as intended. Even MS claims it makes a profit on Xbox. Successful products and services thrive, failing ones don’t.

Being in business isn’t a charity case - we consumers don’t owe MS anything. Sony and others have invested and innovated for decades - they’re entitled to make money to enable future investments.

The regulators enforce healthy competition in the markets because we who live in free market economies, anticipate that competition leads to improved products, services and consumer choice.

So actually, why upset the status quo and risk a healthy market becoming unviable by allowing the ABK deal?

 

[Ronin_7]

A lot, yes, and most of them will fail. The world can handle as many AAA single player games as the studios can produce, but there is only so many GAAS that can survive at any one time.

We'll have to wait & see.

 

[DeltaPolarBear]

We'll have to wait & see.

Waiting for what? GASS had been around for long enough for us to see all the corpses. In fact you can go all the way back to all the failed WoW killers. The most high profile dead GAAS recently is Avengers. You speak like GAAS was going to magically increase the number of hours in a day or something.

 

[vivftp]

Waiting for what? GASS had been around for long enough for us to see all the corpses. In fact you can go all the way back to all the failed WoW killers. The most high profile dead GAAS recently is Avengers. You speak like GAAS was going to magically increase the number of hours in a day or something.

You seem to be grossly over simplifying this subject and are acting as though there is no room for new live service games, so no one should try. Especially first party.

That is not the case and will never be the case.

 

[Heisenberg007]

Waiting for what? GASS had been around for long enough for us to see all the corpses. In fact you can go all the way back to all the failed WoW killers. The most high profile dead GAAS recently is Avengers. You speak like GAAS was going to magically increase the number of hours in a day or something.

You're talking with absolute certainty that none of those 10+ games will succeed. That's equally as bad as someone claiming that all 10+ Sony GaaS games will succeed.

There is a strong possibility that Sony finds its own niche in the GaaS genre and finds success with at least 2-3 games.

Horizon Online seems like it'll launch on PS4, PS5, PC, and mobile devices -- much like Genshin Impact. Who's to say that the 30 million+ fans of Horizon and Monster Hunter series won't like it and start playing it regularly? That's an audience that isn't necessarily playing GaaS games right now but might end up doing -- increasing the size of the GaaS market audience.

TLOU Online can also find similar success because of its large franchise following and newfound TV Show success.

Similarly, these Sony games can also turn out to be so good that they take audience away from other currently successful GaaS games, e.g., PUBG, COD, Genshin Impact, Fortnite, etc.

I don't expect London Studios or Firewalk to be successful with their GaaS games. But there is a strong chance that the bigger studios will because (1) they have strong IPs to use and (2) they are also using Bungie to help guide them.

 

[reksveks]

In a hypothetical scenario where Sony goes after a truly large company, there is one company I feel would be far more valuable and worth it for Sony to pursue than Take Two, and that would be Epic Games. They'd have to buy Tim Sweeneys controlling stake and more probably, and of course figure out what do with Tencent and their massive stake in the company. But Epic Games would massively benefit Sony Group more than any other company I can think of. Gaming IP, gaming engine, live service knowledge, film & TV production penetration, a PC store front... Sony Group would massively benefit. It'd cost even more than Take Two, but it'd also be the better option long term IMO.

Epic would be a more concerning purchase in my opinion that T2 for regulators. I do think it would be more valuable though.

 

[Cheezewizz]

I’d say it’s an argument to the opposite.

Which surprises absolutely no one.

Sony, Nintendo and many other videogaming companies are making money right now in a tough market. This demonstrates the market is healthy and competition is working as intended. Even MS claims it makes a profit on Xbox. Successful products and services thrive, failing ones don’t.

Why is it that this market consists of all these successful companies that "make money". Except for MS of course who only "claims" it does?

Being in business isn’t a charity case - we consumers don’t owe MS anything. Sony and others have invested and innovated for decades - they’re entitled to make money to enable future investments.

Correct, and we consumers don't owe any company anything for that matter. What you seem to be missing here is that MS isn't asking you, or anyone else for charity. They're willing to pay cash for their content. In fact, the only one that is asking for charity is Sony. Who isn't paying a dime to acquire ABK, yet feel entitled to all it's future content.

The regulators enforce healthy competition in the markets because we who live in free market economies, anticipate that competition leads to improved products, services and consumer choice.

No argument from me here. Just make sure you say the same if the deal goes through.

So actually, why upset the status quo and risk a healthy market becoming unviable by allowing the ABK deal?

Status quo? What happened to all that innovation mumbo jumbo earlier? Why risk a healthy market with VR, when the console market is healthy? Why risk a healthy PS4 market by releasing a PS5? Seriously though, if the ABK deal is a risk to the entire market, then the market is anything but healthy. Conversely, if the market is healthy then there's no way that the ABK deal could be a risk to it's viability.

 

[DeltaPolarBear]

You seem to be grossly over simplifying this subject and are acting as though there is no room for new live service games, so no one should try. Especially first party.

That is not the case and will never be the case.

GAAS is restricted by how much time it takes up for the player. You can succeed but only by cannibalizing another game's player base. There is no mathematically way for the majority of new GAAS to make money without killing existing titles to make room.

As a platform holder, it makes no sense to replace one on your platform GAAS with another. You are still being paid the same.

Fate Grand Order on smart phones are an exception because Sony doesn't own the phone platform.

 

[Cheezewizz]

GAAS is restricted by how much time it takes up for the player. You can succeed but only by cannibalizing another game's player base. There is no mathematically way for the majority of new GAAS to make money without killing existing titles to make room.

As a platform holder, it makes no sense to replace one on your platform GAAS with another. You are still being paid the same.

Fate Grand Order on smart phones are an exception because Sony doesn't own the phone platform.

Except that you are literally not being paid the same if one is first party and another is 3rd party.

 

[DeltaPolarBear]

Similarly, these Sony games can also turn out to be so good that they take audience away from other currently successful GaaS games, e.g., PUBG, COD, Genshin Impact, Fortnite, etc.

Sony is currently taking their cut on every PUBG, COD, Fortnite and Genshin player microtransaction on their platform. You are robbing yourself to pay yourself. The main source of money as a platform holder is the rent you extract from third parties, and you are taking that away to pay yourself. Once again, a waste of time and money.

 

[vivftp]

GAAS is restricted by how much time it takes up for the player. You can succeed but only by cannibalizing another game's player base. There is no mathematically way for the majority of new GAAS to make money without killing existing titles to make room.

As a platform holder, it makes no sense to replace one on your platform GAAS with another. You are still being paid the same.

Fate Grand Order on smart phones are an exception because Sony doesn't own the phone platform.

Do you think that only the same people play live service games and that's it, no one else can play them? Again, you're really over simplifying this and not making a cogent argument. Also, do you honestly think that if this were a serious problem that the big brain folks at SIE wouldn't have realized this?

They're taking all the necessary steps to ensure their games have a solid shot, we just need to see how things play out.

 

[DeltaPolarBear]

Except that you are literally not being paid the same if one is first party and another is 3rd party.

most GAAS is Free To Play so no money on initial sale. 30% cut on all sales is huge and more than enough to justify not making your own game to compete. This is why console gaming EXISTS. This is why walled garden EXISTS. First Party game sales are just a secondary income stream. This is why Nintendo doesn't care that Bayonetta doesn't make money.

 

[vivftp]

Sony is currently taking their cut on every PUBG, COD, Fortnite and Genshin player microtransaction on their platform. You are robbing yourself to pay yourself. The main source of money as a platform holder is the rent you extract from third parties, and you are taking that away to pay yourself. Once again, a waste of time and money.

Wow, you honestly do think you know better than Sony. Goddamn, that's funny

 

[DeltaPolarBear]

Do you think that only the same people play live service games and that's it, no one else can play them? Again, you're really over simplifying this and not making a cogent argument. Also, do you honestly think that if this were a serious problem that the big brain folks at SIE wouldn't have realized this?

They're taking all the necessary steps to ensure their games have a solid shot, we just need to see how things play out.

SIE realized this and that is why the mostly focused on first party single player. This is the plan.

 

[Ronin_7]

Sony is currently taking their cut on every PUBG, COD, Fortnite and Genshin player microtransaction on their platform. You are robbing yourself to pay yourself. The main source of money as a platform holder is the rent you extract from third parties, and you are taking that away to pay yourself. Once again, a waste of time and money.

Yup, also APEX, FIFA, NBA 2K etc. All those games are on MTX.

Sony wants their GaaS to coexist.

 

[DeltaPolarBear]

Wow, you honestly do think you know better than Sony. Goddamn, that's funny

Xbox is going all in on GAAS. If you think GAAS is the future you can join them.

 

[reksveks]

As a platform holder, it makes no sense to replace one on your platform GAAS with another. You are still being paid the same.

It can make sense if you can improve the margin on the GAAS revenue and if you are concerned that other platforms could have a GAAS that takes people away.

The fixed margin from 3rd party gaas games on Sony is 30% minus whatever cost to do the transaction.
If Sony can beat that 30% margin, then they are making more money.

I think a 30% margin is hard to beat.

 

[vivftp]

SIE realized this and that is why the mostly focused on first party single player. This is the plan.

Sony's studios have historically focused on single player games with some having MP modes. Their focus has expanded since 2019 and now are working on over 10 new live service games to expand their footprint. That is their plan.

Xbox is going all in on GAAS. If you think GAAS is the future you can join them.

Who said anything about Xbox? We're talking about Sony and what Sony is doing. You seem to be stuck in some scenario where no one else can find success with live service games.

 

[Yoboman]

But but but she said Sony was going to get smoked in 2022.

Sony right now

I guess the only thing that got smoked was her career

 

[Mibu no ookami]

In a hypothetical scenario where Sony goes after a truly large company, there is one company I feel would be far more valuable and worth it for Sony to pursue than Take Two, and that would be Epic Games. They'd have to buy Tim Sweeneys controlling stake and more probably, and of course figure out what do with Tencent and their massive stake in the company. But Epic Games would massively benefit Sony Group more than any other company I can think of. Gaming IP, gaming engine, live service knowledge, film & TV production penetration, a PC store front... Sony Group would massively benefit. It'd cost even more than Take Two, but it'd also be the better option long term IMO.

They'd have to leave everything absolutely 100% independent of course, but that's not a problem. Even then, regulators would be crawling up Sonys asshole over such a deal.

Take Two would be second on my list for truly massive companies they could pursue. In a more realistic scenario though, I think Square Enix still tops my list of who Sony will go after if they should pursue a publisher. They're as close as can be (both historically and currently). Sony Group probably still has somewhere close to 10 billion dollars allocated to spend on M&A between now and the end of March 2024, and Square would easily fit in that budget.

So many reasons not to buy Epic Games.

First, the cost at this point is untenable. Second, as you mentioned is Tencent. You'd have to somehow buy them out, which again is $$$$.

Epic doesn't really have much gaming IP and fortnite isn't worth it. You'd have to immediately start using Unreal Engine across all internal teams for it to be even somewhat worth it and that itself comes at a cost of the benefit of using a custom engine.

All the things Epic gives you, you could get elsewhere for cheaper. This doesn't even touch the regulatory risk of it being blocked, which it almost certainly would be.

Square Enix is such a poor buy that it makes no sense. They aren't the Square or Enix of old and the current relationship is probably the most reasonable one.

You take that 10 billion left over, you borrow a bit more, and then you could for a stock swap for the rest.

 

[Heisenberg007]

Sony is currently taking their cut on every PUBG, COD, Fortnite and Genshin player microtransaction on their platform. You are robbing yourself to pay yourself. The main source of money as a platform holder is the rent you extract from third parties, and you are taking that away to pay yourself. Once again, a waste of time and money.

30% (third party) vs. 100% (first party). Sounds like a great deal.

 

[Heisenberg007]

So many reasons not to buy Epic Games.

First, the cost at this point is untenable. Second, as you mentioned is Tencent. You'd have to somehow buy them out, which again is $$$$.

That's a genuine issue. I agree.

Epic doesn't really have much gaming IP and fortnite isn't worth it.

I disagree. Fortnite and Rocket League are worth so much more.

You'd have to immediately start using Unreal Engine across all internal teams for it to be even somewhat worth it and that itself comes at a cost of the benefit of using a custom engine.

Don't have to. They can just enjoy the royalties from other studios (including Xbox studios) that use Unreal Engine.

 

[Mibu no ookami]

That's a genuine issue. I agree.

I disagree. Fortnite and Rocket League are worth so much more.

Don't have to. They can just enjoy the royalties from other studios (including Xbox studios) that use Unreal Engine.

How much would it cost to buy out Epic? THEN tell me Fortnite, Rocket League, and doing any internal stuff out of unreal is worth it.

 

[Heisenberg007]

How much would it cost to buy out Epic? THEN tell me Fortnite, Rocket League, and doing any internal stuff out of unreal is worth it.

I think it can still be worth it. There's a lot of revenue potential there: big successful live-service games, PC storefront, the world's most popular and commonly used game engine, etc.

Having said that, I do agree that Take 2 will be a better buy. But Epic has its uses as well.

 

[Mibu no ookami]

I think it can still be worth it. There's a lot of revenue potential there: big successful live-service games, PC storefront, the world's most popular and commonly used game engine, etc.

Having said that, I do agree that Take 2 will be a better buy. But Epic has its uses as well.

It took a billion dollars for Sony to get 3% of Epic. You're probably looking at 50-70 billion dollar to buy Epic.

Sony literally couldn't afford it and it would have to be a merger one that would make Tim Sweeney the largest shareholder of Sony and probably their CEO as a result.

Take2 itself would be a stretch, but at least a stretch that was worth it.

 

[Fafalada]

Done a bit of digging and while that 6.08 million figure for FYQ4 2005 is correct it does appear to be production shipments and not shipped to retailers (sold in). From Sony's investors relations page it states that from FY 2008 hardware sales will be reported as sold-in and not production, therefore FY 2007 has been revised with this method. So all official sales data for PS2 from 2000 to 2006 was production shipments and not shipped to retailers.

That's fair - so the 'precise' number may be impossible to confirm.
But I'd argue that historical trend before/after the reporting switch closely match (Quarterly production to retail shipments were very much in the same ballpark - ie. the difference - at least for PS2 between two reporting methods looks like it could be single digit %). Also knowing that same quarter crushed several sales records for PS2 - we have empirical evidence pointing to the fact it was indeed outsized (as well as Q3 sales underperforming due to shortages, which again - is matched by shipment report) so I don't think there's really room for debate that was PS2s strongest quarter overall.

Was it 6M or maybe closer to 5M? 6.5? That may be more debatable - but general ballpark seems pretty reliable.

 

[Baki]

In a hypothetical scenario where Sony goes after a truly large company, there is one company I feel would be far more valuable and worth it for Sony to pursue than Take Two, and that would be Epic Games. They'd have to buy Tim Sweeneys controlling stake and more probably, and of course figure out what do with Tencent and their massive stake in the company. But Epic Games would massively benefit Sony Group more than any other company I can think of. Gaming IP, gaming engine, live service knowledge, film & TV production penetration, a PC store front... Sony Group would massively benefit. It'd cost even more than Take Two, but it'd also be the better option long term IMO.

They'd have to leave everything absolutely 100% independent of course, but that's not a problem. Even then, regulators would be crawling up Sonys asshole over such a deal.

Take Two would be second on my list for truly massive companies they could pursue. In a more realistic scenario though, I think Square Enix still tops my list of who Sony will go after if they should pursue a publisher. They're as close as can be (both historically and currently). Sony Group probably still has somewhere close to 10 billion dollars allocated to spend on M&A between now and the end of March 2024, and Square would easily fit in that budget.

Majority of Epic $5B revenue is from Fortnite and that’s a big risk for a $30B+ purchase. I do agree that Sony would get access to the PC gaming market, GAAS expertise, game engine expertise but only 2 meaningful gaming IPs (Fortnite and Unreal Tournament). Sony owns 5% of Epic and it’s clear they see the value in them as Strategic partners but I feel Take Two is probably the better purchase.

I think Sony still buys Square or another smaller publisher, even if they make a mega purchase like Take Two or Epic.

 

[Baki]

It took a billion dollars for Sony to get 3% of Epic. You're probably looking at 50-70 billion dollar to buy Epic.

Sony literally couldn't afford it and it would have to be a merger one that would make Tim Sweeney the largest shareholder of Sony and probably their CEO as a result.

Take2 itself would be a stretch, but at least a stretch that was worth it.

Epic latest valuation was $30B. Private market valuations are typically inflated due to investors receiving preferred stock and liquidation rights amongst other benefits. The crazy private and public market of 2021 is over. Tim knows that 30-35B is the best he can get if he wants to sell his shares.

Thats basically what i said last year. If sony wants to stay in this business, they simply cannot afford to lose cod. And GTA will be their break out of jail card.

The only problem is that Take2 was worth $18 billion but then they bought zynga for $12 billion. so if sony wants to buy take2, they will need to pay around $30 billion and face stiff competition from microsoft who will undoubtedly bid to raise the price.

But it's something Sony must do. CoD is the most played game on consoles with 55% of all console players playing it. gta is second at 45%.

Take Two market cap is $19B and EV would be $17B due to $2B cash on hand. Microsoft would not be bidding for Take Two and Tencent bid would not be accepted as the US is blocking most China U.S. acquisitions. That only leaves Sony, which means a 40% premium should be good enough to get the deal done.

I agree that T2 is the likely target if the ABK. deal closes.

I think T2 is actually a much better buy than CoD. It's easier to make a CoD killer than it is to make a GTA killer and T2 gives you entry into every major sport except for football, but gives you an option to explore football again when the time is right. Red Dead is bigger than all the games you mentioned outside of CoD.

Zynga gives you direct entry into mobile.

If Sony were to buy T2, I see them going directly after the FIFA license as well.

T2 compliments Sony is ways that no other company does.

If they put GTA6 and Red Dead 3 and Red Dead remake exclusively on a PC PlayStation launcher, that gets them immediate entry along with TLOU MP, Gran Turismo 7/VR, e.t.c.

If I'm Sony, I'd go all in on T2, and then still look at CDPR and From Software.

Agreed, T2 is an excellent get. CDPR is way overvalued because the stock is traded on the low volume Polish stock market. If I was Sony I would short the shit out of the stock and then give CPDR an offer. It would be financial negligence to buy CPDR for anything more than $1.5B. From Software seems like a situation where Sony wants to keep a good relationship with Kadokawa and so partial ownership seems good enough for now.

A better purchase to pair with T2 would be Square Enix. Sony would still need a WRPG studio. Larian could be a good get or maybe they can try to convince EA to sell them BioWare. The studio has been struggling, EA might be open to selling them. The other option would be to buy the new studio setup in Canada by the ex BioWare head but I feel like Sony already has a presence in Canada and would be better suited getting a studio in Europe like Poland (CPDR) or France (Sloclap).

 

[reksveks]

commonly used game engine

that would be the issue imo for regulators but who knows.

 

[Mibu no ookami]

Epic latest valuation was $30B. Private market valuations are typically inflated due to investors receiving preferred stock and liquidation rights amongst other benefits. The crazy private and public market of 2021 is over. Tim knows that 30-35B is the best he can get if he wants to sell his shares.

That's just for his shares. You still have to deal with Tencent.

 

[Baki]

That's just for his shares. You still have to deal with Tencent.

The 30B would be for the entire company. Tencent would be the easier seller to convince imo. They can’t do much with Epic (can’t buy them due to US regulators), so I imagine they’d just be happy to turn their $400m investment into $9B.

 

[Mibu no ookami]

Majority of Epic $5B revenue is from Fortnite and that’s a big risk for a $30B+ purchase. I do agree that Sony would get access to the PC gaming market, GAAS expertise, game engine expertise but only 2 meaningful gaming IPs (Fortnite and Unreal Tournament). Sony owns 5% of Epic and it’s clear they see the value in them as Strategic partners but I feel Take Two is probably the better purchase.

I think Sony still buys Square or another smaller publisher, even if they make a mega purchase like Take Two or Epic.

I think buying T2, CDPR, and FromSoftware puts you where you want to be.

I think partnering T2 with CDPR allows you to deliver more on the promise of Cyberpunk by getting Rockstar involved. That gives you your PC storefront, it also gives you a slew of IP to work on that will drive the PlayStation brand

Red Dead Remake
Witcher 1 Remake
Witcher 2 Remake
GTA4 Remake
The Getaway
Cyberpunk 2
Mafia

Not to mention access to the mobile market, where they could probably better position themselves to take on Google and Apple on AppStores.

 

[Mibu no ookami]

The 30B would be for the entire company. Tencent would be the easier seller to convince imo. They can’t do much with Epic (can’t buy them due to US regulators), so I imagine they’d just be happy to turn their $400m investment into $9B.

Tencent is buying, they aren't selling.

 

[Zok310]

But but but she said Sony was going to get smoked in 2022.

Sony right now

Yeah, for real. Instead sony having their best year ever.
Proof as to why you should not take what people say online as gospel.

 

[Baki]

I think buying T2, CDPR, and FromSoftware puts you where you want to be.

I think partnering T2 with CDPR allows you to deliver more on the promise of Cyberpunk by getting Rockstar involved. That gives you your PC storefront, it also gives you a slew of IP to work on that will drive the PlayStation brand

Red Dead Remake
Witcher 1 Remake
Witcher 2 Remake
GTA4 Remake
The Getaway
Cyberpunk 2
Mafia

Not to mention access to the mobile market, where they could probably better position themselves to take on Google and Apple on AppStores.

I agree. I need to look into CPDR ownership but their current public stock price is a joke. Company barely does $200m in revenue but is valued at $3B because their stock only sees less than $100K in daily trading volume. It’s basically a fake valuation with such low trading volume. Depending on how the company is structured, it can be messy or straightforward for Sony to get a deal done at a fair price.

Tencent is buying, they aren't selling.

*investing not buying. Which means they’re looking to make a return on their money. Especially true with Epic where they’ll never be allowed to buy the company by US regulators.

 

[ToadMan]

Which surprises absolutely no one.

Why is it that this market consists of all these successful companies that "make money". Except for MS of course who only "claims" it does?

Correct, and we consumers don't owe any company anything for that matter. What you seem to be missing here is that MS isn't asking you, or anyone else for charity. They're willing to pay cash for their content. In fact, the only one that is asking for charity is Sony. Who isn't paying a dime to acquire ABK, yet feel entitled to all it's future content.

No argument from me here. Just make sure you say the same if the deal goes through.

Status quo? What happened to all that innovation mumbo jumbo earlier? Why risk a healthy market with VR, when the console market is healthy? Why risk a healthy PS4 market by releasing a PS5? Seriously though, if the ABK deal is a risk to the entire market, then the market is anything but healthy. Conversely, if the market is healthy then there's no way that the ABK deal could be a risk to it's viability.

Wall of text. Tldr apart from a couple of bits.

1. Yes MS claim Xbox is profitable - but they don’t publish that information in their earnings reports. I accept their statement and it begs the question why MS feel the need to acquire ABK at all - it’s a lot more risk to their successful business model.

2. MS is the one making the move - not Sony or Nintendo or anyone else. It’s for MS to demonstrate to regulators that the ABK acquisition won’t negatively impact the market.

3. All of us as consumers will pay if the regulators get it wrong.

 

[Men_in_Boxes]

most GAAS is Free To Play so no money on initial sale. 30% cut on all sales is huge and more than enough to justify not making your own game to compete. This is why console gaming EXISTS. This is why walled garden EXISTS. First Party game sales are just a secondary income stream. This is why Nintendo doesn't care that Bayonetta doesn't make money.

You're still living in 2012 with this mentality.

PlayStation (rightfully) is focused on 2025+, and videogames as a medium is a multiplayer centric medium.

The revenue delta between SP and MP already strongly favors MP and there isn't an analyst alive who doesn't see that delta widening over the next 10 years. Relying on SP is essentially chaining your company to the floor as the forest grows high above you.

 

[vivftp]

So many reasons not to buy Epic Games.

First, the cost at this point is untenable. Second, as you mentioned is Tencent. You'd have to somehow buy them out, which again is $$$$.

Epic doesn't really have much gaming IP and fortnite isn't worth it. You'd have to immediately start using Unreal Engine across all internal teams for it to be even somewhat worth it and that itself comes at a cost of the benefit of using a custom engine.

All the things Epic gives you, you could get elsewhere for cheaper. This doesn't even touch the regulatory risk of it being blocked, which it almost certainly would be.

Square Enix is such a poor buy that it makes no sense. They aren't the Square or Enix of old and the current relationship is probably the most reasonable one.

You take that 10 billion left over, you borrow a bit more, and then you could for a stock swap for the rest.

Also keep in mind that Unreal is becoming a commonly used tool in the film and TV production world, which is massively important to Sony. Not only would they be able to use Unreal for their own game , TV and film production, but they'd be earning revenue from all the others in those 3 industries who also use it.

Unreal is the real prize with the Epic purchase, extras like Fortnite would just be nice bonuses.

 

[Mibu no ookami]

Also keep in mind that Unreal is becoming a commonly used tool in the film and TV production world, which is massively important to Sony. Not only would they be able to use Unreal for their own game , TV and film production, but they'd be earning revenue from all the others in those 3 industries who also use it.

Unreal is the real prize with the Epic purchase, extras like Fortnite would just be nice bonuses.

Not sure if that's worth 30+ billion dollars.

 

[vivftp]

Not sure if that's worth 30+ billion dollars.

Well, all the benefits of Unreal I noted above, their gaming IP which can be also used for transmedia efforts, and an established PC storefront which could be rebranded as the PlayStation Store for PC, I think it's the better long term investment.

 

[Mibu no ookami]

Well, all the benefits of Unreal I noted above, their gaming IP which can be also used for transmedia efforts, and an established PC storefront which could be rebranded as the PlayStation Store for PC, I think it's the better long term investment.

Keep in mind that it would definitely be more than 30b. I can't see it selling for less than 45.

For 45 billion you could buy Taketwo, FromSoftware, AND CDPR

 

[vivftp]

Keep in mind that it would definitely be more than 30b. I can't see it selling for less than 45.

For 45 billion you could buy Taketwo, FromSoftware, AND CDPR

Believe it or not, I'd still take Epic over all 3 combined.

Sony's already got ties with Kadokawa and From, so more exclusive games seem to be incoming.

Anyways, like I mentioned earlier, I think it's far more realistic that if Sony decides to go for another large purchase it'll probably be Square Enix