EA hostile takeover of Take Two
by Michael Perry · in General Discussion · 04/23/2008 (6:20 am) · 9 replies
I'd really like to hear what the development community and GG employees think of the hostile takeover mess that is going on right now. I've been following this story since the first announcement of it: EA in Hostile Bid to Acquire Take Two
From the very onset, this was obviously going to be a very ugly fight: Take Two Fires Back at EA
It's obvious that EA is not the most popular publisher/developer amongst gamers, at least when it comes to their business policy of pumping out yearly sequels that suffer from diminishing return. Not to mention, the practice EA has become infamous for: swallowing smaller companies to increase their profits.
That's really what this all comes down to: Profit. This raging power struggle has absolutely nothing to do with what gamers want. It's all about money and stocks: Wild Ride: Take Two in Play... Stock Soars... Battle Lines Draw
EA obviously wants to gain control of the major IPs held by T2, and they have made some pretty sweet offers. Zelnick, the major T2 player in this war, has held strong and so far rallied "the troops" enough to resist the monster that is EA. However, the battle has had its ebbs and flows. Not everyone is on T2's side: Shareholder Sues Take Two Over EA Offer & Zelnick's Sweetened Deal
However, EA immediately began to show impatience and disdain for the audacity produced by T2. This is where hostile takeovers really start to get nasty: EA Puts Deadline on Take Two Offer
Despite the pressure of the takeover, T2 has continued to request support of those that matter: the shareholders: T2 Tells Shareholders To Reject EA's Hostile Offer. (Again, us as the game consumers, do not matter in this struggle)
It's obvious that T2 has been playing its cards properly, garnering the support of their stockholders and pushing EA back to the battle lines: EA Extends T2 Share Purchase Deadline, Drops Share Price
Continued in next post...
From the very onset, this was obviously going to be a very ugly fight: Take Two Fires Back at EA
It's obvious that EA is not the most popular publisher/developer amongst gamers, at least when it comes to their business policy of pumping out yearly sequels that suffer from diminishing return. Not to mention, the practice EA has become infamous for: swallowing smaller companies to increase their profits.
That's really what this all comes down to: Profit. This raging power struggle has absolutely nothing to do with what gamers want. It's all about money and stocks: Wild Ride: Take Two in Play... Stock Soars... Battle Lines Draw
EA obviously wants to gain control of the major IPs held by T2, and they have made some pretty sweet offers. Zelnick, the major T2 player in this war, has held strong and so far rallied "the troops" enough to resist the monster that is EA. However, the battle has had its ebbs and flows. Not everyone is on T2's side: Shareholder Sues Take Two Over EA Offer & Zelnick's Sweetened Deal
However, EA immediately began to show impatience and disdain for the audacity produced by T2. This is where hostile takeovers really start to get nasty: EA Puts Deadline on Take Two Offer
Despite the pressure of the takeover, T2 has continued to request support of those that matter: the shareholders: T2 Tells Shareholders To Reject EA's Hostile Offer. (Again, us as the game consumers, do not matter in this struggle)
It's obvious that T2 has been playing its cards properly, garnering the support of their stockholders and pushing EA back to the battle lines: EA Extends T2 Share Purchase Deadline, Drops Share Price
Continued in next post...
About the author
Programmer.
#2
Personally, I don't think it'll happen. After GTA hits T2's shares are going to spike and the current offer on the table is below what their shares are trading at now. Besides my general disgust for yet more consolidation within the industry, I don't think the Feds will ok this one should it happen.
04/23/2008 (6:32 am)
I don't know if you saw this or not Monday, I still don't know why Dennis hasn't covered it at GP yet, but T2 did formally reject the offer. They rejected it at least until after GTA IV is released. They actually said in the press release they were open to formal talks after it's release.Personally, I don't think it'll happen. After GTA hits T2's shares are going to spike and the current offer on the table is below what their shares are trading at now. Besides my general disgust for yet more consolidation within the industry, I don't think the Feds will ok this one should it happen.
#3
That's nonsense. Look at the sales of The Sims and their sports division. Gamers keep paying for those games, sequel after sequel. I cant' see much difference from this than the MS-hate that is floating around slashdot.
EA might be a very bad employer, but that has little to do with their game design.
04/23/2008 (6:38 am)
Quote:
It's obvious that EA is not the most popular publisher/developer amongst gamers, at least when it comes to their business policies of pumping now yearly sequels that have suffer from diminishing return.
That's nonsense. Look at the sales of The Sims and their sports division. Gamers keep paying for those games, sequel after sequel. I cant' see much difference from this than the MS-hate that is floating around slashdot.
EA might be a very bad employer, but that has little to do with their game design.
#4
I was talking about how they run their business and acquisitions.
The fact that these companies make great games is backed up by the profits they've made. This issue is separate from design and development.
This is also no where close to being similar to a "MS-hate" thread. This is not a thread bashing EA. I stated that both of the companies have some dirt in this matter.
I'll make bold my opinions and leave a note so they are separate from the rest of the story.
04/23/2008 (6:44 am)
@Stefan - I already made those points. Quotes from my original post:Quote:
...at least when it comes to their business policies
I was talking about how they run their business and acquisitions.
Quote:
The only power we have is our purchasing power...
Quote:
We can all agree that no matter who holds the rights, we were going to pick up GTA IV no matter what. EA, Take 2, Blizzard... Who cares? They develop and publish the games we all love.
The fact that these companies make great games is backed up by the profits they've made. This issue is separate from design and development.
This is also no where close to being similar to a "MS-hate" thread. This is not a thread bashing EA. I stated that both of the companies have some dirt in this matter.
I'll make bold my opinions and leave a note so they are separate from the rest of the story.
#5
Also, let's not forget about the more recent mega-merger between Acivision and Blizzard. The mainstream game industry currently reminds me of a lava lamp. It used to be nothing but small companies. These grew and merged into reputable medium sized outfits. The larger companies emerged due to their success and great game design (EA, Blizzard, Take Two). Now we are seeing these large companies merge together Akira style.
I'm not against mergers and acquisitions all together. Look at GarageGames and IAC. I'm happy with that business deal, particularly that GG is able to hold on to their creativity and decision making control for our community and engines.
04/23/2008 (6:55 am)
@Scott - I share your general dislike for all the mergers and acquisitions over the past year. EA has acquired or taken over so many studios: Maxis, Tiburon, Westwood, Bioware, Pandemic, etc.Also, let's not forget about the more recent mega-merger between Acivision and Blizzard. The mainstream game industry currently reminds me of a lava lamp. It used to be nothing but small companies. These grew and merged into reputable medium sized outfits. The larger companies emerged due to their success and great game design (EA, Blizzard, Take Two). Now we are seeing these large companies merge together Akira style.
I'm not against mergers and acquisitions all together. Look at GarageGames and IAC. I'm happy with that business deal, particularly that GG is able to hold on to their creativity and decision making control for our community and engines.
#6
And my point was that your usual gamer won't care what EA does business wise, as long as they make good games. (I don't play any of their games but I know people who do and are very satisifed with them)
Gamers that also develop games and/or are in the industry think differently, but they are also not in majority.
04/23/2008 (7:20 am)
Quote:
I was talking about how they run their business and acquisitions.
And my point was that your usual gamer won't care what EA does business wise, as long as they make good games. (I don't play any of their games but I know people who do and are very satisifed with them)
Gamers that also develop games and/or are in the industry think differently, but they are also not in majority.
#7
Again, this is just opinion and I'm glad you joined in the conversation. That brings up the question:
Should gamers care?
04/23/2008 (7:24 am)
I know it is not a proper study, but pretty much every gamer I've talked to in my circle of friends (which again, probably doesn't represent real stats) feels the same. Love the games, dislike the business.Again, this is just opinion and I'm glad you joined in the conversation. That brings up the question:
Should gamers care?
#8
04/23/2008 (7:58 am)
As long as quality games continue to come out, why should the gamer care? If it means that certain IP got squashed that people were looking forward to (Oh man! They killed the Smurfs MMO!) then gamers would get upset. But from a business perspective, if a title were to be profitable it would likely still get made. The real difference is that perhaps the keys for those final decisions are in less people's hands now POSSIBLY, and the riskier titles might not see the light of day. This means less smash dark horse hits from the commercial sector possibly, in untested markets or niche markets. Which means more opportunity for the Indie sector IMO. 
#9
Entertainment industries are all pretty much mirrors of themselves. Think of the game industry of today and tomorrow as you do the music industry. A bunch of untalented businessmen controlling the artistic consumption of the masses. But sometimes, good stuff gets through.
04/23/2008 (8:46 am)
I don't think I've ever know any developer to proclaim love for EA. Even the developers of the old C64/Apple flatboxes had disdain for EA as a publisher. That being said, anyone who thinks any business is in this industry, or any other industry, for anything other than profiteering is delusional. And the larger the company, the more obvious it is; in any industry.Entertainment industries are all pretty much mirrors of themselves. Think of the game industry of today and tomorrow as you do the music industry. A bunch of untalented businessmen controlling the artistic consumption of the masses. But sometimes, good stuff gets through.
Employee Michael Perry
ZombieShortbus
T2 has held strong, and GTA IV will be released on time. Zelnick and other T2 talking heads claim that once GTA IV is released, EA will be on the ropes. If they still want to make an offer, it will have to be sweeter for T2 and its shareholders. However, the more perceptive person will see the true gain of EA. GP mentioned the sports aspect. Any company can make any sports game they want. What EA holds is the rights to produce officially sponsored games, such as the NFL.
That's right, the only officially sponsored NFL game is Madden. T2 has made efforts to produce their own series of football games, such as Blitz: The League and All-Pro Football 2K8. Sports, not GTA, are driving this deal: Pachter: Sports Drives T2 Deal for EA; GTA is "Gravy"
So, who are the bad guys in this mess? The knee jerk reaction would be to say EA, which is actually my opinion. However, once again T2 is not squeaky clean in this venture: T2 vs EA Update: Zelnick Slammed by TheStreet.com... EA's CFO Bails
Suits are suits. Corporations are corporations. Gamers are consumers. The only power we have is our purchasing power, but that is the problem. We can all agree that no matter who holds the rights, we were going to pick up GTA IV no matter what. EA, Take 2, Blizzard... Who cares? They develop and publish the games we all love. Despite our desires to purchase what we love, we have to look at this potential takeover from the ethical perspectives. What about the creativity and freedom of T2: Street.Com Columnist: EA Could "Kill the Spirit" of Take Two.
T2's subsidiaries (Rockstar), have pushed the envelope when it comes to edgy content in video games. They have taken fire from every politician, watchdog group, and insane Miami lawyer, but have held to their convictions. What's more, is there room to argue a possible monopoly? IF EA succeeds, they could potentially hold every license to every professional sport out there. That doesn't mean other companies can't make football or baseball games. So, what is more important to you as a gamer? New, innovative sports simulation? Or the same played out football game as last year that merely has an updated roster of the only team you are going to play through the whole game?
On a more humorous note, a certain Miami lawyer has even thrown in his two cents about this debacle. Mr. Jack Thompson, who needs no introduction, is the most widely known critic and enemy of T2. If you don't know why or how, you need to crawl out from under your rock and look it up. There is not enough space in this post to hit it all. At any rate, Mr. Thompson has thrown his hat in the ring to provide aid to EA: What A Guy... Jack Thompson is Ready to Help EA with T2 Takeover Bid
Shockingly (not), EA has rejected Mr. Thompson's offer: EA Wants No Help From Jack Thompson in T2 Takeover Bid. I guess EA has not forgotten the inaccurate (read flat-out-friggin-lie) claims that gamers could play The Sims and see genitalia, pubic hair, and take control of sexual simulations.
I'm attempting to bold any opinionated statements, so as to make it clear how I feel and separate it from the facts of this issue