The Great Video Game Business and Financial (In)Stability Thread

Yep, that too. Amazing what happens when the power balance is evened out.

Itch.io is quite a company.

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I blame horse armor for NFTs.

Rat Boy wrote:

I blame horse armor for NFTs.

I mean, it's kind of the grandfather of NFTs.

fenomas wrote:

Itch.io is quite a company.

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Not enough people are saying this, but it is 100% true.

https://kotaku.com/ubisoft-nft-crypt...

Ubisoft is going to be the next company taken over in the great consolidation.

The NFT enthusiasm is a pretty clear indication that the top of the company has been taken over by weird business goons, not folks who really get tech and games. Sort of feels like Mattrick-era Xbox or post Rage Bethesda. It's not the behavior of a healthy company.

Interesting tweet thread here: https://twitter.com/klobrille/status...

I've mentioned that this is an account that Microsoft seems to use for messaging prior to having their spokespeople go on record officially. This thread, in particular, feels like a very carefully written bit of corporate communication.

It suggests that Microsoft may be getting a little more pushback on the Activision Blizzard purchase than they were expecting. And it also (carefully) calls out Sony for some anti consumer behaviors, contextualized within the framework of Sony's market dominant position, with the implication that a stronger Xbox brand will lead to more pro-consumer outcomes.

It seemed notable because Microsoft is usually extraordinarily reluctant to engage in any console-war type trash talk or criticism of the competition.

Are you saying Klobrille is paid by Microsoft?

LeapingGnome wrote:

Are you saying Klobrille is paid by Microsoft?

Yeah, sort of.

But, I don't mean that in any kind of nefarious way. I don't know if Klobrille even exists as a person. I don't know if there is a person there to be paid. But, I've been following the account for years and I'm pretty sure the account is controlled by Microsoft and used in the way described above.

It's true that Sony is anti-crossplay which is anti-consumer. Online games need a large population to be viable, and a lot more games would be viable (or would just have better matchmaking) if they had crossplay.

The big picture is that Microsoft/Blizzard has the potential to benefit the consumer and the Sony/Bungie seems to benefit the companies.

ActiBlizzard is hugely dysfunctional and Microsoft should bring them stability. At least in theory. And it should benefit consumers in the short term and long term.

Sony benefits from Bungie's expertise and Bungie will benefit from Sony's publishing power and film/tv markets. But that only indirectly benefits computers in the long term.

fangblackbone wrote:

ActiBlizzard is hugely dysfunctional and Microsoft should bring them stability. At least in theory. And it should benefit consumers in the short term and long term.

I've never seen "we'll bring company X stability" as a valid defense in an anti-trust argument. I also struggle with the assertion that it will benefit consumers in the short and long term. The whole rationale behind the worries about the acquisition is Microsoft will have a massive amount of market power. If they decide to have all their publishers be exclusive to their platform, lock everything into GamePass and start charging $20/month, there's almost nothing consumers can do. That scenario is unlikely, but just the potential is very consumer unfriendly. I struggle to see any manner in which the acquisition is "consumer friendly" at best it's neutral.

If the predicates are true (I know, a big "if"), one of the possible implications of this statement is that Sony is aggressively using lobbyists to try to get regulators to block the Microsoft Activision deal. Maybe much more aggressively than Microsoft anticipated.

It would explain why the statements are framed as they are - carefully calling attention to and contextualizing Sony's anti-consumer practices and studio takeovers.

I'm not trying to advocate for one side or the other here, I'm just trying to piece together what may be happening behind the scenes.

I can't imagine that the MS/ATVI deal wont go through. If you won't even be the largest player in a market, how much of an anti-trust issue will it be seen as?
On the other side, ATVI stock refuses to go much above $80, despite its future value, if the deal goes through, being $95. Lots of potential investors must believe there is a significant risk.

staygold wrote:

If they decide to have all their publishers be exclusive to their platform, lock everything into GamePass and start charging $20/month, there's almost nothing consumers can do.

As bad as it would be, we could just shrug and stop buying their products. There would still be a majority of the game market left for us to enjoy.
Now, if they locked down Windows, so you could only play games through Windows Store/Xbox app... that would be a problem. Albeit, given PCs market share, not sure that would count for much either.

In most cases I would be against MS (or anyone else) buying "smaller" publishers, consolidating the industry. But in ATVIs case I buy into the argument that ATVI really needs to be saved before they completely crash and burn. This is as good an effort as any.

Shadout wrote:

But in ATVIs case I buy into the argument that ATVI really needs to be saved before they completely crash and burn.

Is there a reason why Activizzard shouldn't be allowed to just crash and burn?

hbi2k wrote:
Shadout wrote:

But in ATVIs case I buy into the argument that ATVI really needs to be saved before they completely crash and burn.

Is there a reason why Activizzard shouldn't be allowed to just crash and burn?

Yes. I want Warcraft 4...

Most of its management and HR should crash and burn though, but presumably that is also the departments MS is not lacking.

polq37 wrote:
LeapingGnome wrote:

Are you saying Klobrille is paid by Microsoft?

Yeah, sort of.

But, I don't mean that in any kind of nefarious way. I don't know if Klobrille even exists as a person. I don't know if there is a person there to be paid. But, I've been following the account for years and I'm pretty sure the account is controlled by Microsoft and used in the way described above.

It would be pretty nefarious for Microsoft to run a verified Twitter account that is supposedly independent press that has a Patreon setup for supporters to fund their reporting and explicitly claims they are not affiliated with MS.

They MIGHT be getting inside information from MS as a way to 'leak' stuff to the public but I don't think it is like they are an employee or an account run by the MS marketing department.

More interesting statements from Microsoft: https://blogs.microsoft.com/on-the-i...

They're committing to a lot of stuff that they're already doing and that is already in their business model. The distinction they try to draw between game console app stores and general purpose computer app stores seems a little weak to me. And, they state that some form of Call of Duty will continue in some multiplatform status beyond the preexisting commitments. So, they're committing to almost nothing in their statement, but making a lot of pro-consumer noises. The fact that they feel obligated to put out statements like this is interesting, though.

As for Klobrille, I mean yeah, sockpuppet accounts try not to actively announce that they're sockpuppets. That's kind of the point. He (I assume) says he is a "lone wolf" and "independent". He doesn't claim to be a journalist or part of the press. He claims that he is "Not affiliated with Xbox.", which is not the same statement as "I am not affiliated with Microsoft Corporation or any of its subsidiaries or business partners." His disclaimers are not in language that would satisfy a contracts lawyer. Although, to be fair, very few things are written in a way that would satisfy a contracts lawyer.

Maybe he's just a German xbox superfan, followed by Phil Spencer and Aaron Greenberg, who's whole business is producing xbox marketing infographics, who somehow only ever says stuff that is in line Microsoft's current or future marketing messages.

Anyway, to me, it reads as though yesterday's tweetstorm is written in pretty much the same voice as today's Microsoft blogpost.

From what I have read, MS is really, really worried about the government pulling out anti-trust measures, so they are doing everything they can to make sure it doesn't. Saying "we will allow games we make to be played on our direct competitor's platform" is a big argument against anti-trust.

I don’t see anything that Microsoft is doing as unusual. These types of statements always come out before a big merger or acquisition. They serve multiple purposes in addition to setting a tone to regulators. It’s also to send messages to investors as well as customers and sometimes even suppliers depending on the industry.

I don’t see this as unusual in the slightest but rather business as usual.

As for the Twitter user being some sockpuppet account…that makes zero sense on multiple levels. Outside of it being a real account from a low or mid level Microsoft employee it’s certainly not under some shady control of Microsoft PR or Marketing. Microsoft is a huge company that is spending $68B on this deal and will have other major deals across all sorts of business lines for years to come. There’s no upside to some Twitter account. It’s not going to move the needle in any significant way for Microsoft to risk the embarrassment.

No, nothing they're doing is unusual. But it is still interesting to me. The statements that they are making now sound different from the ones that they made after the Bethesda acquisition. They're a lot more defensive. It suggests that they're getting more pushback, maybe more than they expected and that they may be in the regulators' crosshairs to a greater degree than they anticipated. This has follow-on implications for who gets bought next and when. If the regulatory authorities were like, "Green light, go for it!", we would probably see Microsoft making more major acquisitions in the near future. But, it's looking more like they will have to settle with Activision Blizzard for now and there's a greater chance that some other potential takeover candidates will end up with Sony.

As for the rest, every smart management team I've ever been on has understood the value of socializing a message before announcing it publicly and officially.

Overinterpret the noise and you are a crazy conspiracy theorist. Underinterpret the signal and you miss the bus.

Not sure if there's a better place for this-- more games-journalism-business related as opposed to games-business-related per se-- but the GMG Union, which covers Kotaku as well as Gizmodo, Lifehacker, Jezebel, and others, is on strike.

I've been interviewing for jobs recently and been asking every employer I interview with what their prognosis is for work location and every one has said "the software folks aren't coming back ever - the hardware folks want to be back in the lab".

This is shockingly good news from the video game industry.

I wonder if they would give people an office option. I work in government administration and many of my coworkers don’t like being fully remote. I work from home 1-2 days a week and any more than 2 tends to be uncomfortable.

Apparently California Governor, Gavin Newsome, has been interfering with the Activision Blizzard discrimination suit to support Activision.

Quick summary according to Jason Schreier:

- Janette Wipper, chief counsel on the Activision Blizzard lawsuit, was fired last month.
- Melanie Proctor, assistant chief counsel, resigned in protest last night, accusing Newsom's office of "mimicking the interests of Activision’s counsel."
- Fate of the lawsuit is unclear

What a piece of sh*t.

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