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UFC 3 failed to break even at 2 million units, report claims
UFC Undisputed 3 failed to break even – which triggered the sale of the UFC license to Electronic Arts – THQ representatives allegedly said during an E3 investor meeting. "THQ sought to exit its UFC contract as the most recent iteration fell short of its ≈2 million unit break-even point," a Wedbush Securities report claims. THQ has yet to confirm the report.EA Sports executive VP Andrew Wilson recently revealed that THQ approached EA to first initiate talks on the deal.In related news, a quick search shows that a number of recently laid off THQ San Diego employees have listed work on "UFC 4" on their LinkedIn profiles. THQ's UFC series originally appeared to be annual with its first two games before the company planned an extra year to develop the latest game.We've reached out to THQ for confirmation on this information, and will update as soon as we learn anything new.
Report: Vivendi looking to sell 'part or all' of majority stake in Activision
Activision's French multimedia conglomerate parent company, Vivendi SA, is said to be considering a sale of its 61 percent controlling stake in the US-based Call of Duty publisher. Bloomberg reports that Vivendi is holding a meeting on June 22 to discuss the potential for a sale of "part or all" of its Acti holdings. The report comes from "people with knowledge of the matter," who refused to be identified due to the privacy of the June 22 event.A Vivendi representative confirmed the upcoming executive get together, but didn't discuss the specifics of the meeting. Said meeting has taken place annually since 2005, and the rep noted it's intended as "a forum of exchange and discussion, not for quick-fix decisions or solutions."Vivendi and Activision came together in 2007, creating Activision-Blizzard as a result of the merger. Vivendi sold three percent of its Activision stock in late 2011, but kept approximately 60 percent of its holdings. Since today's report, Vivendi's stock rose 3.7 percent in Paris markets.Update: To help contextualize some of this super business-y madness, Wedbush Securities analyst Michael Pachter told Joystiq, "Some believe Vivendi is worth more if it is split up into various parts. The potential split doesn't really mean anything for Activision, other than a lot of shares on the market all at once. I don't think a sale is likely, as there are few potential buyers, if any. Instead, it makes more sense for Vivendi if they have Activision borrow a lot of money and pay a dividend of all of its cash. Spin it off to Vivendi shareholders." He added that he's not sure if the report is accurate or not.
Analyst says no one is buying MMOs after SWTOR fizzled
Wedbush Securities analyst Michael Pachter has a dim view of MMO assets following the lukewarm performance of Star Wars: The Old Republic. "Nobody is buying MMOs after Star Wars fizzled," Pachter told Joystiq. The context surrounding the statement involves the valuation of 38 Studios in the wake of its Copernicus melt-down. "There is just no demand for game assets right now, as THQ proved when it tried to sell the Warhammer MMO. I think [Electronic Arts] could step in, since they are the publisher, so you might see some alternative way to get 38 some bridge financing," Pachter said.
Wedbush thinks Grand Theft Auto 5 will launch in October
With this morning's announcement that BioShock Infinite will now launch in February 2013, publisher Take-Two Interactive altered more than a game's launch date. Take-Two is a publicly traded company, and one fewer gigantic product launch during the holiday season – arguably Take-Two's only holiday product launch, unless you count fall launches of Borderlands 2 and XCOM: Enemy Unknown as "holiday" – means that shareholders will want to know what's up. That worry is reflected in Take-Two's stock price, which took a five percent hit since the market opened this morning.But when Infinite got pushed out of the holiday season, it opened the slot up for another high-profile Take-Two-published title: Grand Theft Auto 5. "In our view, the delay opens the window for Grand Theft Auto V to be released in October 2012," Michael Pachter of Webush Securities wrote in an email this morning, echoing a release window leak from earlier this year.In his eyes, Infinite wasn't just delayed to make it "something even more extraordinary," as Ken Levine put it, but because the folks at Rockstar, "notified Take-Two that GTA V would be ready for October." He believes this resulted in Take-Two offering Irrational Games an extra few months to prepare BioShock Infinite. His logic? "The studio [Rockstar Games] has scheduled every prior GTA release during that month (with GTA IV delayed to April 2008, due to bugs in the PS3 version)."Furthermore, Pachter and co. speculate we could hear more about GTA 5's launch date "as early as May 22" during a scheduled quarterly investor call, or perhaps in a few more weeks at E3 2012. We've yet to hear back from Irrational, Rockstar, or Take-Two on the subject.
Analyst: SWTOR caused Dragon Age III delay
There's been a lot of discussion following the recent EA earnings report in which the company announced that Star Wars: The Old Republic has 1.3 million subscribers, down from its previous 1.7 million mark. We've heard from the fans, the critics, and the studio itself -- now it's time for the analysts to contribute their side of the conversation. According to Wedbush Securities analyst Michael Pachter, EA's investment in SWTOR has caused a delay in other projects at BioWare, particularly in Dragon Age III's case. The analyst noted that Dragon Age III's expected release window was delayed, and he says this is due to the enormous undertaking of SWTOR. "We believe that a significant portion of the BioWare team responsible for the game was reassigned to Star Wars in order to create content and fix bugs to keep the game's audience engaged," Pachter said. Delay or no, Pachter is upbeat about EA's future, especially in light of the earnings report's news that the company turned a profit. He says that the company will continue to grow, make money, and be a good bet for investors.
Nexon bids for EA takeover, everyone says it's very unlikely
You know Nexon, right? The South Korean MMO company that made Maple Story and ... uh ... Everplanet ... and stuff? Anyway, Nexon is a pretty big deal on the other side of the Pacific Ocean. Such a big deal, in fact, that it's looking at buying out some of its rivals, apparently including EA. MK Business News (a South Korean newspaper) reports that Nexon's Japanese headquarters spoke with EA about a potential acquisition recently.What came of those talks, however, is unclear. For its part, EA isn't offering any news. "We don't comment on rumors and speculation," is all reps told us, which you'll notice isn't a denial of said talks taking place.But could such a deal even take place? Experts don't seem to think so. "My takeaway is that this deal cannot happen," Wedbush Securities analyst Michael Pachter told GI International. "There are few, if any synergies, and no reason to believe that Nexon could run EA's assets more efficiently. Nexon shareholders would own a completely different company than what they bought in the December IPO," he added, referring to Nexon's late 2011 public stock offering.So for now, while the talk of an EA takeover is always scintillating to discuss, it's very likely not happening (at least via Nexon) anytime soon.
3DS sold under cost since price cut, Nintendo 'hoping' to profit by March 2013
Nintendo took a big hit last year when it dropped the price of its then-nascent handheld, the 3DS, to $170 just a few months after initial launch. Such a hit, apparently, that Nintendo is selling the unit for less than it costs the company to produce, as revealed in the company's latest financial earnings. "Its hardware has been sold below cost because of its significant price cut in the fiscal year ended March 31, 2012," the financial report says.But don't count Nintendo out! The company says it "expects to cease selling it below cost by the middle of the fiscal year ending March 31, 2013." Which, in normal human terms, means Nintendo expects to start making money on the console around August of this year. So, you know, if you're really trying to stick it to Nintendo, go buy the 3DS between now and August. That'll show 'em!The 3DS currently sells for $170, down from the $250 price tag it launched with back March of 2011.Update: We've added context from financial analyst extraordinaires Michael Pachter (of Wedbush Securities) and Jesse Divnich (of EEDAR) just below the break.
Report: EA planning premium, pre-launch DLC for retail games at $10 - $15 [Update: EA explains]
During a recent visit to EA's offices, Wedbush Securities' Michael Pachter (and other analysts) got what he calls a "candid" view of the future for the publisher. Among the many glowing things that Mr. Pachter had to say in the report from the meeting, he reveals that EA group general manager Nick Earl told him EA has plans "to release premium downloadable content (PDLC) as a product for sale prior to the release of a packaged product." Comparing the PDLC to Battlefield 1943 -- a game for which we unfortunately have yet to see any post-release support from EA -- Earl revealed that the content will be priced at between $10 to $15 through Xbox Live Arcade and PlayStation Network, and will arrive prior to a "full-blown packaged game." That "full-blown packaged game" will of course still carry a "full retail price" when it does arrive in stores. Pachter expanded to Gamasutra, "I think that the plan is to release PDLC at $15 that has 3 - 4 hours of gameplay, so [it has] a very high perceived value, then [EA will] take the feedback from the community (press and players) to tweak the follow-on full game that will be released at a normal packaged price point." This is just one part of the digital effort EA is gearing up for in the coming year, according to the report, which details an expected "1/3 [growth] of revenues over the next few years" in the digital market. Between this and 'Project Ten Dollar,' EA's certainly taking an aggressive approach to new monetization routes on the digital frontier. It remains to be seen how it'll all pan out, but for now things are at least staying interesting. Update: EA's Jeff Brown explained the PDLC concept to us in more detail this afternoon, saying: "EA is working on a number of projects for delivering premium content to consumers before, during, and after the launch of a packaged-goods version of the game. EA SPORTS, EA Games and EA Play are each experimenting with download strategies that deliver fresh game content in formats players want to experience. To date, there is no set pricing strategy for the entire EA portfolio. And many of the proposals include free-to-play content on models similar to Madden Ultimate Team, Battlefield Heroes and Battlefield 1943. None of the proposals call for charging consumers for traditionally free game demos."
Law of the Game analyzes ex-IW bosses' suit against Activision
[Maveric2003] When various legal fracases arise from time to time, we turn to Law of the Game's Mark Methenitis, an actual, real lawyer, for thorough analysis. So, Methenitis kindly looked over the full complaint filed against Activision by ex-Infinity Ward heads Jason West and VInce Zampella, and then described to us the importance of the little things: the wording of the contract between the two ex-heads and Activision, the financial implications of the possible loss of the Modern Warfare name (for either side), and the ... shall we say, flamboyant ... language used in the document itself. According to Methenitis, the complaint's colorful phrasing is "for dramatic effect and little more." Methenitis pointed out in an email exchange with Joystiq that "readers shouldn't place too much emphasis on the language in the facts" and that the story told by the claims "sounds like a relatively common 'business deal gone bad' kind of suit." As for this particular case, though, he allowed, "Granted, based on the value of Call of Duty and Modern Warfare, the stakes are high both for the royalties and future creative control of the brand." (Methenitis here is referring to the ex-studio heads' allegation that Activision had handed over creative control of all Modern Warfare-branded games, part of the "Memorandum of Understanding" that was agreed upon between the two parties before the creation of Modern Warfare 2.) The stumbling block for West and Zampella, Methenitis said, could be in the wording of the memorandum. "That [receiving their royalties and retaining control of the Modern Warfare name] may be more problematic if the wording of the Memorandum of Understanding isn't such that it can be enforced as a contract," he said, adding, "Given the context and description in the suit, it seems like the term 'Memorandum of Understanding' in this case is just a fancy title for a contract rather than a less-than-enforceable agreement similar to a Letter of Intent." (Head past the break for Methenitis' full analysis.) While Methenitis wouldn't weigh in on the possible end result of this suit, Wedbush Securities analyst Michael Pachter mentioned in his latest report that, "We think that West's and Zampella's claim for creative control over the Call of Duty and Modern Warfare brands has little merit, and we expect Activision to retain control over the brands." One thing's for sure, if a messy lawsuit does get underway (and isn't settled out of court like so many are), we'll assuredly catch wind of more dirty laundry.
