When you have Final Fantasy as an exclusive game you don’t need Japan Studio
Don’t think anyone is making that mistake though. Do you really think getting “Japanese” games makes more business sense than getting studios that make third person action adventure games (like Sony’s)?
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Isn’t Microsoft making at least two of those with Ninja Theory and Compulsion Games though?
Ha. My reaction was not nearly that strong, but the comments about Ubisoft’s profitability (not just from you) have probably been a bit misguided.
I’ll answer your question by trying to explain the various motivations for acquisitions.
Generally speaking, there are several potential motivations for acquisitions. Some acquisitions may be motivated by only one of these, but some may be motivated by several. (There is obviously some overlap in these categories.)
- Target is resource constrained / Acquirer has resources – The Obsidian and InXile acquisitions (among others) would be in this category.
- Target has enormous growth potential – I would probably put Mojang in this category.
- Target and Acquirer have huge synergies (the 2 + 2 = 5 phenomenon) – WB / Discovery and the failed Nvidia / ARM acquisitions would fall in this category.
- Target has something that needs to be fixed / Acquirer thinks it can fix it (commonly known as a “turnaround” situation) – a potential Ubisoft acquisition might fall here. Due to the scandals, the Activision acquisition may as well. Zenimax has elements of this as well.
- Target has some specific asset, technology, etc the acquirer really wants – An Xbox / Discord acquisition would have fallen in this category.
Depending on how narrowly you want to define things, you might add another one or two motivations to the list above, but I think I got the big ones.
A few key points to note about this:
- Many acquisitions have elements of multiple categories. Zenimax was (probably) resource constrained, was struggling financially (turnaround), and had IP Xbox really wanted. So, it checked at least three boxes.
- Many of the Xbox acquisitions have a synergy element. Since Xbox is a platform holder, every acquisition has the potential to increase console sales, increase GamePass subs, reduce GamePass turnover, etc. The number crunchers at Xbox certainly have dollar estimates for the synergistic benefits of the major acquisitions. (My opinion is that most individual studios probably have few synergies for Xbox, but the publishers have a lot.)
- Acquisitions are always about the future, not the past. It doesn’t really matter if Ubisoft (or whoever) is profitable right now as long as the acquiring firm thinks it can fix whatever problems exist. Turnaround acquisitions can be wildly profitable since struggling firms may be bought “cheap” then see their values skyrocket if the problems actually get fixed.
Edit: I forgot the Defensive motivation in my list above. Acquirer buys target to keep someone else from getting it and/or cutting off access to products, services, etc. I don’t think that has been the major motivation for any recent gaming acquisitions. Zenimax may have had an element of this. If Xbox buys Square then it would probably fall in this category.
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I have yet to come to terms with either of those studios making something the same scope as one of Sony/Ubisoft/WB efforts.
So you’re saying all gamers only care about Japanese content if it’s Final Fantasy and that it’s okay to have closed Japan Studio for that reason? Despite the fact that JS never made anything that was even comparable to Final Fantasy? Okay… bad take is bad.
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Yeah, the situatiom with EA is one I’m looking forward to see what ends up being.
As much as I would like to see Microsoft get a Japanese publisher such as Capcom or Sega I think it will be a long time before that happens or at least until they are willing to sell.
So something Microsoft could do if they aren’t able to get a Japanese publisher after the ABK acquisition is get smaller independent studios or hire as many developers to Tango Gameworks as they can or even do more partnerships. That way Microsoft can have a presence in Japan and it would keep games from skipping Xbox.
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Thank you for always expounding on assertions I tend to have to make ad nauseam, seriously it’s much appreciated from someone directly in the finance game.
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I mean that’s not what I’m saying but it’s true the vast majority of people care more about Final Fantasy than Japan Studio’s output which were both targeting the same demographic . In short, Sony was able to close down Japan Studio without much impact because of their huge Japanese third party support including exclusivity on Final Fantasy.
Correlation does not equal causation.
But I digress, as mentioned previously this is the thread for Xbox acquisitions.
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I am not someone that wants Xbox to acquire Ubisoft. However, Ubisoft is a French publisher, with locations all over the world.
They also add diversity and nearly 20k employees. It shouldn’t be brushed off
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I’m a fan of many Ubisoft games and would love to see a Ubisoft acquisition, but I also agree with most of your points. I think it is inevitable that Xbox will address many of the gaps you mention. The only question is when. Also keep in mind that most of the firms on your list would cost peanuts compared to Ubisoft. So it’s not really an either/or on buying Ubisoft vs. Spike Chunsoft or IO Interactive.
One other point to keep in mind is that Xbox currently has a gap in third person action adventure games with high graphic fidelity (i.e. the “Sony game”), which Ubisoft fills perfectly. What we now think of as the Sony game is basically a Ubisoft-style game that has just been optimized and polished to a high degree.
To address your final question - your English writing is absolutely fine. I could only dream of writing that well in a non-native language. (Despite the three years of high school and two years of college I spent working on my Spanish and Italian. Ha.).
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I’m not aching for MS to acquire Ubisoft, but it definitely makes business sense and wouldn’t stop them from making other acquisitions.
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Lmao you are indeed correct… Embarrassing for me but thank you for the correction, always get those two confused…
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Ubisoft will be a good acquisition, the potential of backwards compatibility would be insane(if they ever continue adding more games)
But what is more interesting in my opinion is what all this studios could do with xbox, maybe bring back an old ip, maybe make an entirely new one, the only thing for sure is that gamepass would have a ton of new first party content every year
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I want Xbox to buy Ubisoft because my Master Chief tattoo is beneath my Assassins’ Creed tattoo and this would give me shill-hood privileges.
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The fact that EA and Ubisoft are “considering” being acquired is crazy to me. If I had to choose for MS I would definitely go for EA though. SPORTS+Mass Effect+Skate+Sims+Dragon Age+ Apex Legends+many of their games already being on GPU screams synergy to me.
Activision Blizzard doesn’t make any of those big open world third person type games which Sony has now adopted. The biggest I can think of is Prototype which was 13 years ago!
This is why Ubisoft is an ideal acquisition IMO. Everyone seems to think they are a French studio but they have over 50 studios around the world, including in-house support studios which Xbox clearly need!
- Brazil
- Canada
- México
- USA
- Italy
- Spain
- France
- Poland
- Russia
- Serbia
- Sweden
- Denmark
- Finland
- Germany
- Romania
- Ukraine
- Bulgaria
- UK
- United Arab Emirates
- India
- Korea
- Japan
- Taiwan
- Vietnam
- Australia
- Hong Kong
- Singapore
- Philippines
- China
You literally can’t find another publisher with as much location diversity!
Hmm for all we know that game could be a complete flop. Again someone like Ubisoft have a track record with Rayman, Just Dance and Rabbids etc, plus they are more likely to appeal to casual families.
Allegedly Microsoft’s AR game studio is already working on 1 v 100 (their name is escaping me right now).
It’s quite clear from their sales figures that they sell less than western centric games and that’s including the western sales. The Japanese market is limited for example a top seller from Japan like Elden Ring will max out around 1 million sales in Japan due to a smaller market, despite the game selling over 13 million copies overall. Japanese games of course sell in other markets but looking at this from a business perspective rather than personal preference you have to admit a western game will typically sell substantially more than a JRPG for example.
The games from their Japanese studios didn’t sell anywhere near their western style games, that why they were closed - business sense. Due to Sony previously dominating the western market they could strike deals like FF with Japanese publishers, this will get increasingly hard to convince Square as time goes on. If for example Xbox gains 50-60% of the market do you think Square will want to continue limiting their player base and potentially kill their own IP - no.
This! People need to look at this subjectivity and look at what sells. Sony didn’t just start making western style third person games for the sake of it!
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I 100% agree with this, it’s the main thing I have been saying Xbox needs for years. As Ubisoft are currently developing Avatar they also aren’t scared to touch pop culture which Xbox could do with IMO.
Thank you for your analysis, it was also very helpful to review a potential acquisition from that perspective. IMO Ubisoft ticks nearly all of the points you raised.
In terms of geographic footprint I can’t think of any other gaming acquisition that will give them 50+ game studios over 30 different countries, especially for under 10 billion.
Ubisoft also own a large mobile division which is often overlooked and most of their games are also on PC. Tom Clancy also has a big e-sports movement on PC.
As much as people complain about Ubisoft games they are some of the biggest IP’s in the world, they are also some of the top sellers. You can guarantee to see Ubisoft in the top 10 sellers every year.
I could also see Xbox acquiring them as a defensive move, if another publisher got them I believe it would have a massive impact on Xbox. When you go to the top played games section on the Xbox UI you almost always see Rainbow Six Siege up there with CoD, GTA and Minecraft etc.
Ubisoft clearly need to be fixed long term but if we look forward rather than back they have massive growth ahead of them IMO. Going back to the late 00’s ERA Ubisoft was on fire 
!
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