EA is undoubtedly the best choice for Microsoft. EA Sports would bring great value to GP. Microsoft would significantly increase its profit and achieve its goal of becoming the largest publisher in the world. They would get a lot of GAAS, mobile games, and The Sims which has a very large community on PC. EA also has interesting studios like Respawn, Motive, Criterion and Bioware that could develop AAA games. Microsoft could control the releases of COD and Battlefield so as not to put them in competition. Bioware could be rebuilt with support from Obsidian, BGS, InXile and Playground. It makes sense, EA is a long-time partner of Microsoft and there would be excellent synergy between the two companies. Even if the acquisition of EA seems completely crazy, Microsoft should take advantage of the current policy and its move to multiplatform to try to acquire EA, especially since EA is now worth less than Take Two.
EA and EA Sports are separated so maybe they can go just grab the EA Sports part the whole publisher doesn’t make sense. EA has an estimated 10-14k employee’s and there is a lot of redundancy there. Ea Sports makes sense but this is Microsoft they’ll get something like all of NetEase Japanese studio’s or something worthless like that that will make no money instead of going after somebody like EA, Sega or Square.
Question: Why would EA (especially their stakeholders) consider selling EA sports as the most valuable part of their company?
TBF EA Play is already in GP Ultimate. Take-Two (2K Sports) on the other hand isn’t on GP.
Not to mention EA’s value has actually dropped due to EA football underperforming and dragon age vaularge don’t doing that good so assuming their stock continues to fall it is also a great time to buy
But why would EA sell their most profitable branch of their company, EA sports is their money maker along side battlefield. It would make no sense for EA to part it, just like it would of made no sense for ABK to sell just King hence why Microsoft had to buy the entire thing
To be fair, Microsofts commitment to game pass feels kind of up in their air at this point and if we assume Microsoft is still commited to it odds are they will be getting a version of it on PS so they will likely neeed to nagiotiate with Sony for them to allow it and 1 of the most likely stipulations will probably be no 3rd party games they don’t publish so EA Play will likely no longer be bundled if that does happen. But both T2 and EA are great buys to expand their reach in mobile and the casual market
Yes, but EA games come to Game Pass Ultimate 6 months after their release, getting them on day one would add a lot of value to Game Pass. Take Two is not a bad acquisition, they also have successful sports games like NBA and WWE, but they release fewer successful games each year and the value of the company is mainly based on Rockstar. Also, Rockstar games have extremely high development costs, I’m not convinced it’s profitable to put them on day one on GP. I think EA has a bigger GAAS segment with games like EA Sports (with Codemasters), NFS, Apex, Sims, Battlefield. It’s a safe bet for years to come.
Honestly after take two bought gear box and more so zynga i would say EA and Take Two are more or less equally as good acquisitions as EA probably has a stronger sports game presents (especially if you count driving games where they F1, Burn out, need for speed, NFS & Dirt) but not that Take Two owns Zynga they have a better mobile presents however EA probably has the stronger casual market outside of mobile when considerint the pre mention sports and driving games, Battlefield, the sims, apex legends, Skate, plants vs zombies and mass effect but take two has rockstar and 2K games which means while not having as many casual games their casual games are either comparable or bigger but i would also say EA has the more impressive line of IPs that could either be revived or actually given life with stuff like dead space, dragon age, mass effect, burn out, mirrors edge ect. But take two also isn’t far behind and could possibly be revived easier if rockstar was expanded enough since most of their dormant IPs are from them e.g. bully, manhunt, midnight club, max payne, duke nukem, bioshock and xcom but EA definitely has more room for mobile expenaison as despite own mobile stuff they don’t have big mobile publisher like take two now however take two probably has more room to expand on PC and console mostly because rockstar only launches 1 game a gen. On top of that despite EA now being slightly cheaper both their market caps are still comparable. To me both EA and Take Two are pretty much equal, i could honestly easily see a reality where microsoft buys both of them just to prevent another party from buying them even of their going 3rd party.
Now in terms of chance, I think EA is more likely simply because their stock is dropping so assuming that trend continues its probably a good time to buy them but without that factor and price was identical it would pribably once again once again be an equal thing HOWEVER I would probably lean slightly on the side of Take Two simple because i think mobile is the biggest factor and take two mergered with Zynga but they aren’t the same value. Last time i checked EA had a 20% drop in value and i believe that trend has continued
True, having those sports games day one would be huge for GP, it might even move GP into the mainstream as you’re be catering to all the casuals that mostly play COD, Madden & FIFA etc.
Looking at the top 10 US chart for 2020- Jan 25 we had the following appearances (some titles appear in multiple years top 10):
- COD: 9
- Madden: 7
- FIFA/FC: 4
- Hogwarts Legacy: 3
- NBA 2K: 2
- MLB: 2
- College Football: 2
I don’t deny T2 or EA being their best opportunity to reach the casual market, however I still don’t realistically see MS ever having the opportunity to acquire any of the big 4 (T2, EA, Epic & Valve). Not after ABK… regulators would never approve them, even with their new multiplatform approach.
I honestly disagree, i dont see regulators caring anymore if microsoft bought 3 out of those 4 (they would definitely care if gabe somehow agreed to sell though). Microsoft is no longer really competing in in the console space so they would only argue the merits of cloud which with the exception of the CMA non of the regulators cared much about and since then the CMA has been restructured. Assuming the same level of scrutiny is dumb as both microsofts positions and stratgy has drastically changed since then and more importantly the regulatory bodies have changed since then. Lina Khan is thankfully no longer leading the FTC
Take-Two is a way better publisher the IP they have the studios they have fill all the holes MS needs other than Japanese content. GTA 6 & GTA Online alone are worth it add in Zynga, WWE & NBA. NFL is out but they can make a College Football Game & FIFA Football Game that would most likely make EA’s football games seem outdated. The Regulation landscape is just right. The CMA was a roadblock they’ve changed their tune since their restructuring and the FTC seems to lean towards defending and allowing American companies to grow instead of colluding and defending the revenue of non American entities with ideology that often doesn’t stand up in court.
We lost exclusives with ABK with Take-Two we might lose certain titles coming Day 1 to Gamepass be careful what you wish for 9 times out of 10 there is always some bull crap that comes with those earth shattering moves.
Take-Two would be a good get but just a few indie studios would be less of a headache. CD Projekt Red, IOI and Sega(if they are open to being acquired) would be fire without spending 50 billion dollars to get them.
I think CD Projekt can be just as good as Rockstar in the long run. Microsoft is working with some news studios that are working on their first projects in partnership Xbox Publishing maybe they should grab a few of those if the projects come out right.
As far as sports they should look into getting Midway’s back catalog from WB and spin up some new versions of those Midway Arcade Sports titles Saber Interactive would be a good candidate to make them. Since NBA Jams isn’t available(EA has the rights) use NBA Full Court Press an old MS Basketball game for PC as the title. Also grab Netherrealm (one can dream)while you’re getting Midway. Those old Midways titles would be perfect to load into Muse AI and get running again. Rampage and Gauntlet would be fun to play again.
One thing we all become immediately aware of with the ABK acquisition was that regulators do not understand the gaming market (at all). Some of the questions that were being asked by these ‘professionals’ were simply embarrassing. This includes the CMA, FTC and EU commission.
With this in mind I don’t see any argument that MS could put forward to acquire the next biggest publisher after already acquiring ABK. The competition would all object (especially PS) just like they did last time.
The only arguments they could put forward are the same as last time in that their console market share is smaller than PS and Nintendo (even though their revenue has way surpassed Nintendo and is catching up with PS), therefore regulators could ask why ABK was insufficient. Their PC, Mobile and Cloud market share will already be greater than either of the above so they can’t use that.
You would think their new multiplatform strategy you would help them but unless they are going to make legal commitments it’s meaningless and realistically MS aren’t going to let them dictate where and how their products can be sold for eternity.
All you need to look at is the COD deal. They agreed they would continue releasing it on PS and Nintendo for the next ten years. After ten years they could make it exclusive. They won’t make it exclusive but from a legal perspective you would never agree to that for the rest of eternity.
For example if the PS playerbase died in 10 years and only 10 people carried on using it. As a company trying to prioritise profits would you continue spending millions porting a game for potentially 10 customers?
Realistically I think they would need to make legal commitments to release all of the T2/EA games on all platforms at their current schedule (which is day one). No timed exclusivity, no paid early access and no GP incentives (inc releasing on rival cloud streaming platforms) to have any chance to get it through. Agreeing COD for ten years is one game but a publishers entire catalogue would be incredibly risky and for how long… I personally don’t see it at all.
You also have to remember each regulator will also have their own demands and even the competitors (like PS, Nvidia, Nintendo, Valve etc) will also request X from MS before they withdraw their complaints to the regulators (just like they did with ABK). For example the ABK games and GP are now supported on Nvidia Geforce Now because MS had to make that deal to get their support with regulators. Once you factor in all those crazy demands on top it will all just get out of control.
I think that is a matter of perspective.
I think it’s fair to say that the majority of T2’s revenue comes from GTA, NBA 2K and Zynga.
EA on the otherhand have far more titles in the top selling games each year and they are literally sitting on a IP goldmine which for years has been neglected. I think the issue with EA has mainly been down to poor management/direction and understanding what their customers want, as if you look at the IP’s that EA have decided to focus on they have typically been poorly delivered resulting in EA’s value gradually dwindling.
It’s only this year that T2 finally surpassed EA in market value and I personally think of a lot of T2’s current value is due to the impending GTA release, once that’s been and gone it will start to settle down again.
People have been requesting Sims 5 forever (4 released in 2014!!). Same with Medal of Honour, C&C, Mercenaries, Titanfall, Burnout, Overlord, Operation Flashpoint, Dungeon Keeper, Army of Two, Road Rash, SSX and many of their other franchises. My wife and I have been waiting 17 years for Peggle 3!! Then the IP’s which are still active like Battlefield and Need for Speed need a complete overhaul (which it sounds like they are finally doing)!
Rockstar are the real gem of T2, their attention to detail is like no other studio. I would say their production value might even surpass any of the Xbox or PS first party studios on any given day. Unfortunately most of that talent is locked up in the monster that is GTA and not in titles like Red Dead, Bully and other (more interesting) IP’s.
When GTA releases T2’s value will go through the roof, however I think it will settle down again and I think EA could surpass them again if they get their act in order. You have to remember EA also have some big games coming up to complement their annual sports games (which alone are huge cash cows) like Mass Effect, Battlefield, Need for Speed and new Marvel/Star Wars games.
I mean, once again I consider EA and T2 basically equal as once again while take two does have some bigger IP EA is more consistant with the IPs releasing as most of their major franchises are announce or near annual or consistantly getting examsions. Rockstar drops a game once a gen at this point & T2 Sports is big but EA sports is still bigger, escpecially if you factor in EAs massive line up of racing games, not to mention the sims exapnsions & battlefield.
I mean, i think microsofts commitment to game pass is up in the air regardless at this point and their at a cross road where they will either let it slow die off with xbox or nagotiate a version of it on PS with most likely just 1st party content and if they do go for the latter i think day 1 outside of xbox will be a thing of the past regardless so doesn’t really change much
Strong disagres. I think CDPR is a petty bad acquisitions considering their price point (they are very over priced) their question quality as while they did fix cyberpunk don’t forget its launch state, their games don’t hit rockstar numbers and microsoft already has a ton of WRPGs so why bother spending so much on 1 more a gen
I mean, the collapse of WB games is only feeling more likely as time goes on so along side Ubisoft i do think them being acquired is a matter of when not if
https://x.com/Wario64/status/1894463233010127345
I don’t think that is necessarily true. I think what happened with the CMA and FTC (cos keep in mind the EU was actually pretty reasonable) is they saw microsoft and the 69 billion dollar price tag and saw a prime opportunity to politically posture. Both knew this wasn’t a monopoly but saw an opportunity to stick it to big business rather than protect consumers
I mean, would they have too. The regulators aren’t as agressive now and they are going 3rd party so they basically kills all the arguments from the jump that don’t involve cloud, so that is the only potential regulatory road block that could remain
I guess i would have to disagree there. Unless cloud takes over in that time which i doubt will happen i think both PS and Nintendo are very secure in this industry and i think a Microsoft that is going 3rd party anyway would make any multiplatform consession. The only points of contension i could see are cloud and subscriptions service relatated.
A strategy and a legally binding commitment are very different though.
None of the regulators will simply take MS at their word that they will follow a new multi platform strategy, they will need something legally binding.
Next year Phil, Sarah and Matt could go and the new Xbox management could change the strategy and make everything exclusive.
Alternatively Xbox could say we are amending our strategy to make all EA/T2 games exclusive to Xbox for two years and then port it. At that point if GTA was exclusive for two years it’s basically a permanent exclusive as those who want it will have got it on Xbox.
Regulators have to approve/reject based on what could happen, not simply trust a private company will do best by the consumer (which they don’t).
And following on from what I said previously I can’t see Xbox legally agreeing to that in perpetuity (their previous 10 year agreement for ABK - COD is just one game).
Absolutely sucks about WB games.
I’m willing to bet money that PS would be on the phone within minutes if Xbox tried to acquire EA or T2.
They did it with ABK and EA/T2 would be exactly the same.
They don’t need to, they will have access to microsoft internal documents and plans and odds are it will be there in black and white & odds are it won’t change as it was likely Satya which forced the changes not Phil, and even if as assume that was a concern the regulators could just demand a remedy which if microsoft wasn’t BS they would just agree too.
I am not saying they wouldn’t. Xbox is dying and they want to put the nail in the coffin. I am saying PS won’t be a dead brand within 10 years so microsoft won’t be in a position where they are supporting dead hardware due to a concessions.
True but it more evidence of the inevitable reality of them being sold off eventually. It reallt feels like they are cutting fat to make it look like a more attractive buy. It is also the only reason i can justify them keeping rocksteady after suicide squad, rocksteady is like another bioware. All the talent is gone but their still a massive name so their kept around, keeping that name recognision would probably help sell the division for slightly more
We will have to agree to disagree on this one. From my experience regulators never take companies at their word, it has to be legally binding.
Ah I see, I don’t think PS will be either. I was just using that as a example for one of potentially thousands of scenarios why they wouldn’t commit to a legally binding contract of that nature.
Yeah but if microsoft is being honestly they shouldnt have issues agreeing to concessions, so even then I don’t see it as that big of an issue outside of maybe cloud and sub services, i could see Microsoft not wanting to agree to remedies there.
I get that but microsoft didn’t have issues signing those contracts in the EU nor an issue when the EU made those contracts legally binding so i don’t think they will have an isue there
Anyway, this WB situation really feels like they are cutting the fat to position themselves to sell off the division to me. Even keeping rocksteady around feels kind of like that as they feel like a bioware as in all the talent has left but their name recognition is still massive.
If it were to happen I think there would be lots of potential buyers fighting over NetherRealm.
That said Avalanche (post Hogwarts legacy) will be in high demand too. TT Games has always been floated around as a family friendly studio that Xbox should go after.
It could be the same with the next acquisition. The situation is probably better for Microsoft with the changes in strategy and policy, but we cannot guarantee that an acquisition will be validated by regulators after what happened with ABK. All we can say is that this is probably the most favorable situation to acquire and that Microsoft should take advantage of it if it wants to continue to develop in video games. Microsoft may want to acquire another giant to significantly increase its profits (EA, Take Two, Valve, Epic Games, Krafton, Roblox…) and it will undoubtedly be another long legal battle with an uncertain fate.
Rocksteady despite the flop of suicide squad is still a big name so they would probably sell for a fair amount. I can’t help but this this makes too much sense if they were planning on selling their division this or next year
I mean their is always an element of risk but outside of valve it is hard to make a case to block now. That is the thing, regulators can’t just block. They need to prove their case either in court in the case of the FTC or in the government with the CMA and I am assuming EU, and once you got those 3 your pretty such set