It’s a recession here in the US of A and that means belt-tightening times for many Americans. Less money for frivolous expenditures like say… video games and consoles. It also means that the value of companies that sell those games can take quite a dip, if forecast revenues don’t measure up to reality. This isn’t a bad situation to be in if you’ve been saving trillions of pennies to buy one of those companies. You get where I’m going with this? Hang in there…
Right now, EA is swimming like a sperm on a mission to fertilize a deal for Take-Two. Take Two rejected EA’s first offer of 2 billion dollars as not being consistent with the value of the company. 
A lot of that value has to do with the cargo ship of cash that T2 is expecting upon the release of Grand Theft Auto 4. There are more eggs in this basket than any other time in history, with the possible exception of that time that lady admitted to cheating on Moment of Truth.
While all indications are that GTA4 is going to sell like hotcakes to most of us, there are still millions of people for whom 60 dollars for a game is getting to be less and less doable. If GTA4 suffers in the slightest from this economic crisis. T2 could have already seen its highest offer, and declined it. If the cash flow is lower than they have projected to their investors, the value of the company declines and so does the size of the offers from the folks interested in buying it.
In other words, if GTA4 doesn’t exceed expectations in terms of raw sales numbers, things could get really interesting. Who else could benefit from this? I have at least one idea… Read on.
CONTINUE TO PAGE: 1 2
 |
 |
 |
 |
 |
6 responses so far ↓
1 DarthVicious82 // Mar 20, 2008 at 2:19 pm
So Doc…how do you think this could effect Sony? Many of the analysts have been saying this is the year of the PS3…and thus far…the numbers seem to be proving them right. Could this change in the light of a recession in the US? Many people have been holding off on a PS3 until the games were there. Now the games are beginning to trickle in…but gamers may be less likely to drop $399 (or $1000 in Lono’s case) on a new console. Will Sony feel the bite too…or simply leverage it’s position in Europe and Asia? Interesting times to say the least…
2 Doc // Mar 20, 2008 at 2:22 pm
A great question. I think that while MS has the market saturated fairly well, which is sorta what I attribute their sslow down to, Sony has a lot of room to grow, and a lot of Duel-COnsole households to create. That would really suck for them if this downturn continues.
3 LJ // Mar 20, 2008 at 2:45 pm
Another quck ? Who do you think benifits more in the Micro-Yahoo deal? I mean Microsoft would benifit from having Yahoo under its wing, but who really wins in a situation like that when you getting so much money to sell your company? The business being taken over or the business doing the takeover?
4 Doc // Mar 20, 2008 at 2:58 pm
The stockholders usually… at least that’s my understanding. I mean if you give Yahoo! 49 billion dollars but then you OWN yahoo… then… did you really spend anything? hahaha kidding
5 World of Warcraft games » Blog Archive » Sour economy is sweet for EA, MS // Mar 20, 2008 at 3:13 pm
[...] Cheng wrote an interesting post today onHere’s a quick excerptIt’sa recession here in the US of A and that means belt-tightening times for many Americans. Less money for frivolous expenditures like say… video games and consoles. It also means that the value of companies that sell those games can … [...]
6 Pages tagged "sour" // Mar 26, 2008 at 4:47 am
[...] tagged sourOwn a Wordpress blog? Make monetization easier with the WP Affiliate Pro plugin. Sour economy is sweet for EA, MS saved by 11 others josette54 bookmarked on 03/26/08 | [...]
Leave a Comment