Take-Two News......

[Braylon]

Quote: Originally Posted by grunt

1. 1.2 billion dollars is never chump change. This 1.2 billion that will never go into research and development

...and never would have...

Quote: Originally Posted by grunt

and it didnt kill the competion.

Uh, yes it did. It made it so that releasing a football game will not be economically viable for anyone but EA.

Quote: Originally Posted by grunt

Guess what Take-TWO is still a viable sport gaming company. They have football, basketball, hockey, college ball, golf, and boxing.

...that nobody will buy... Speaking for football anyway. And we both know that the rest of the sports will follow.

Quote: Originally Posted by grunt

2. I still dont see the enhanced revenue for EA in the deal. I see it for the NFL/ESPN but not EA. Maybe, you can better explain the enhanced revenues.

First, there's marketing. EA, ESPN and the NFL benefit every time their name is mentioned. The more people they can impress upon the better. That's why companies pay so much for super bowl ads. It is to associate their name with the most important athletic event of every year, and it's to reach the largest number of people possible.

When ESPN's entity is used in a game, the player is exposed to that entity hundreds of times every game they play. Anyone watching them play will be exposed to that entity the same number of times. Every time it is reviewed, everyone who sees it sees that brand entity.

The same goes for EA. Every time EA's name and/or logo are used or mentioned, EA benefits. This translates to sales.

Next, there is the integration. According to the reports I have read, ESPN and EA are partnering in several new ventures combining online content, in-game content, etc.

Beyond that, I do not work for EA or ESPN, so I don't know what their specific plans are. But the bottom line is that the most viewed sports network, which also owns and runs the #2 sports magazine in the country, just signed a 15 year exclusive deal with EA. That's a money maker, and a revenue stream in and of itself.

Quote: Originally Posted by grunt

3. The 400 million gained today in the stock market can go just as fast. Have you ever heard of dot coms.

The dot com crash was a completely different scenario. That was a long time coming, and was the result of too many people putting too much money into something that didn't exist.

The entire video game market would have to crash for something like that to happen to EA. At this point, that isn't likely. It's engrained into our culture now.

But yes, the money can go just as fast as it came. Happens all the time. The mid-day high always comes back to Earth late in the day, at least a little bit, even when a stock is trending up. But this stock will continue to rise for the rest of the week, and it will retain its value for quite awhile. The money will flow in when the games are released, and no money goes out until then anyway.

Quote: Originally Posted by grunt

4. How can you say no one in EA disagree with this deal. If you have 2 finance managers, you will have 3 diffrent opinions.

How can I say it? Because it's true. This isn't a matter of picking Manning over Brady for the cover of the game. This is a deal with *ESPN*. It is a guaranteed money maker.

And anyone who had invested in EA and wanted to make money, any of those shareholders could have sold and made 4% today. That's huge.

Quote: Originally Posted by grunt

5. I guess we can disagree on this topic. 100 plus million dollar investment is not low and if they sell the same amount of units then this deal will eat into their existing profits.

First, it's not "$100m plus." It's $119m minus what they are paying now for the NFL and Madden licenses. You can also spread the ESPN license across the sports as well, since this is a brand-wide deal.
Second, it's not going to eat into their profits because they are going to sell more units. My point was that they would remain profitable even if they didn't sell more. But they WILL sell more. A LOT more.

Quote: Originally Posted by grunt

6. EA wont buy VC because Take-TWO have dibs on VC. This is the agreement TT had with sega.

EA can buy VC, TT and/or Sega. Easily. They might anyway. The GTA distro is surely a big moneymaker.

Quote: Originally Posted by grunt

They are many reasons why this deal could go bad. The videogame market doesn't continue to grow and TAKE-TWO stays in the market and take market share.

If the video game market does not grow, EA makes a killing on this deal. The NFL deal increased their marketshare a ton, because all those other titles go away. Sega only had an 8% share, and now their highest selling title, as well as their brand, are now gone.

Take Two is an afterthought. Take Two can't do anything to make this deal go sour, they don't have enough capital, neither real nor figurative.

Quote: Originally Posted by grunt

Which top ten business school did you attend.

I am not going to get into a pissing match with you about degrees.Suffice it to say that my name is not Braylon.

[Braylon]

Quote: Originally Posted by grunt

In the article it didnt define partnership. Its not like ESPN and EA have a profit sharing agreement.

They don't need one. EA makes a killing on this deal regardless.

Quote: Originally Posted by grunt

Here is what TT had to say: "The ESPN license was principally a branding tool and as such does not have a meaningful impact on game play," said Take-Two spokesman Ed Nebb. "The key to the video game business, especially sports, is to develop the best game possible and the games produced by Visual Concepts are among the highest-rated and best-reviewed sports games available." TAKE-2 isnt going anywhere. Let see next fall.

For Take Two, this WAS just a license. For EA, it's more than that. Read the article.

Take Two may still be around, but they cannot make their highest selling game next year. If they do, it will have to be a CFL game, or a generic game. Everyone already buys Madden anyway, what makes you think anyone would buy a generic game at $50 over Madden?

BTW, maybe Take Two drops the price to $40 to price themselves competitively. Maybe even $30. But the $20 price point is not profitable, even without the license, and it was never meant to be permanent.

[Erratic]

Quote: Originally Posted by Braylon

They don't need one. EA makes a killing on this deal regardless. For Take Two, this WAS just a license. For EA, it's more than that. Read the article. Take Two may still be around, but they cannot make their highest selling game next year. If they do, it will have to be a CFL game, or a generic game. Everyone already buys Madden anyway, what makes you think anyone would buy a generic game at $50 over Madden? BTW, maybe Take Two drops the price to $40 to price themselves competitively. Maybe even $30. But the $20 price point is not profitable, even without the license, and it was never meant to be permanent.

Lol, now your just rambling... If you actually knew stuff... Then you would realize the VC came out and said, that football doesn't really mean much to them in terms of the amount of money it generates...

They can afford to sell it at 20 and be just fine...

[grunt]

Quote: Originally Posted by Braylon

...and never would have... Uh, yes it did. It made it so that releasing a football game will not be economically viable for anyone but EA. ...that nobody will buy... Speaking for football anyway. And we both know that the rest of the sports will follow. First, there's marketing. EA, ESPN and the NFL benefit every time their name is mentioned. The more people they can impress upon the better. That's why companies pay so much for super bowl ads. It is to associate their name with the most important athletic event of every year, and it's to reach the largest number of people possible. When ESPN's entity is used in a game, the player is exposed to that entity hundreds of times every game they play. Anyone watching them play will be exposed to that entity the same number of times. Every time it is reviewed, everyone who sees it sees that brand entity. The same goes for EA. Every time EA's name and/or logo are used or mentioned, EA benefits. This translates to sales. Next, there is the integration. According to the reports I have read, ESPN and EA are partnering in several new ventures combining online content, in-game content, etc. Beyond that, I do not work for EA or ESPN, so I don't know what their specific plans are. But the bottom line is that the most viewed sports network, which also owns and runs the #2 sports magazine in the country, just signed a 15 year exclusive deal with EA. That's a money maker, and a revenue stream in and of itself. The dot com crash was a completely different scenario. That was a long time coming, and was the result of too many people putting too much money into something that didn't exist. The entire video game market would have to crash for something like that to happen to EA. At this point, that isn't likely. It's engrained into our culture now. But yes, the money can go just as fast as it came. Happens all the time. The mid-day high always comes back to Earth late in the day, at least a little bit, even when a stock is trending up. But this stock will continue to rise for the rest of the week, and it will retain its value for quite awhile. The money will flow in when the games are released, and no money goes out until then anyway. How can I say it? Because it's true. This isn't a matter of picking Manning over Brady for the cover of the game. This is a deal with *ESPN*. It is a guaranteed money maker. And anyone who had invested in EA and wanted to make money, any of those shareholders could have sold and made 4% today. That's huge. First, it's not "$100m plus." It's $119m minus what they are paying now for the NFL and Madden licenses. You can also spread the ESPN license across the sports as well, since this is a brand-wide deal. Second, it's not going to eat into their profits because they are going to sell more units. My point was that they would remain profitable even if they didn't sell more. But they WILL sell more. A LOT more. EA can buy VC, TT and/or Sega. Easily. They might anyway. The GTA distro is surely a big moneymaker. If the video game market does not grow, EA makes a killing on this deal. The NFL deal increased their marketshare a ton, because all those other titles go away. Sega only had an 8% share, and now their highest selling title, as well as their brand, are now gone. Take Two is an afterthought. Take Two can't do anything to make this deal go sour, they don't have enough capital, neither real nor figurative. I am not going to get into a pissing match with you about degrees.Suffice it to say that my name is not Braylon.

1. You cant know if releaseing a pro football game wouldnt be economically vialble. Wouldnt you need to know how much the game cost to produce the game and how many units they need to make a profit.

2. I will buy a VC football next year and I think other people will also. How many, I really dont know but gamers will but if the price point is low enough.

3. The NFL benefits because they will recieve 300 million dollars, ESPN will benefit because the will recieve close to a billion dollars over 15 years. With 1.2 billion dollars EA could have used the money better. You can buy alot of ads for 1.2 billion and r and d.

4. TAKE-TWO just purchased the people that made Rocky boxing and Links and Amp from Microsoft. Guess, what Tiger Woods isnt in the game but Links should pretty well. You dont have to be no. 1 to make a profit. TAKE 2 have over 1 billion on hand not as much as EA but still they have alot of money.

TAKE 2 made their top competitor spend over billion dollars to compete with them. While TT didnt really have to spend anything. Who won? We will see.

[Braylon]

Quote: Originally Posted by Erratic

Lol, now your just rambling... If you actually knew stuff... Then you would realize the VC came out and said, that football doesn't really mean much to them in terms of the amount of money it generates... They can afford to sell it at 20 and be just fine...

The price point was never intended to be permanent. The reason they said it didn't mean much to them is because they were trying to get their foot in the door. It wasn't making money, they were gambling that they could earn a significant market share because people tried their games out this year so they would still support them next fall when they went back up to $50. It backfired because EA bought up everything out from under them.

They are not profitable at $20. There's a reason why nobody comes out with brand new games at $20. You can't make money that way.

[grunt]

Quote: Originally Posted by Braylon

The price point was never intended to be permanent. The reason they said it didn't mean much to them is because they were trying to get their foot in the door. It wasn't making money, they were gambling that they could earn a significant market share because people tried their games out this year so they would still support them next fall when they went back up to $50. It backfired because EA bought up everything out from under them. They are not profitable at $20. There's a reason why nobody comes out with brand new games at $20. You can't make money that way.

Not true. Like I said before you have to know how much it takes to make and market the game before you make this statement. TAKE 2 didnt lose money and without paying the NFL/ESPN I can see them selling their game for 39.99 and doing pretty well.

[K_GUN]

take II is just a few days away from getting an exlcsuive deal wit MLB (1st party devs too)


EA is the evil empire...but all empires have luke skywalkers too

[Braylon]

Quote: Originally Posted by grunt

1. You cant know if releaseing a pro football game wouldnt be economically vialble. Wouldnt you need to know how much the game cost to produce the game and how many units they need to make a profit.

You can ascertain all of that from the market. How many companies develop games and sell them for $20? Not too many. And in the rare instances in which they do this, it's either a promotion (like the Sega Sports thing was), or it's a closeout.

Quote: Originally Posted by grunt

2. I will buy a VC football next year and I think other people will also. How many, I really dont know but gamers will but if the price point is low enough.

Not enough to make it economically viable. There's a reason that nobody else makes a brand new football game every year for $20.

Quote: Originally Posted by grunt

3. The NFL benefits because they will recieve 300 million dollars, ESPN will benefit because the will recieve close to a billion dollars over 15 years. With 1.2 billion dollars EA could have used the money better. You can buy alot of ads for 1.2 billion and r and d.

EA spends $500m on R&D every year. It's a relatively small portion of their budget, yet more than enough. $1.2b worth of ads still wouldn't add up to the amount of money that EA will get from the ESPN brand and integrated marketing, as well as NFL exclusivity.

Quote: Originally Posted by grunt

4. TAKE-TWO just purchased the people that made Rocky boxing and Links and Amp from Microsoft. Guess, what Tiger Woods isnt in the game but Links should pretty well. You dont have to be no. 1 to make a profit. TAKE 2 have over 1 billion on hand not as much as EA but still they have alot of money.

They should spend it wisely then. Putting out a non-licensed football game is not wise.

Links is a better game than Tiger Woods. But Tiger Woods outsells Links badly. Always will, as long as Tiger and the PGA license are exclusive.

Quote: Originally Posted by grunt

TAKE 2 made their top competitor spend over billion dollars to compete with them. While TT didnt really have to spend anything. Who won? We will see.

EA didn't have to spend a dime to compete with them. EA could buy Take Two at any time. Sega had an 8% market share in sports games. They were in no position to "make" anyone else "compete."