December 23, 2007

Why Is It So Hard To Believe?

Is it really that hard to believe that SOE could possibly have been sold to an Indian gaming company? I am going to present some ideas that should make people think twice about SOE's denial.

Prior mergers and moves:


1. EA scooped up Bioware out of nowhere.

2. Blizzard and Activision merged out of the blue.

3. Mythic denied any buyouts. A month later they became EA Mythic.

4. SOE and Sigil repeatedly denied Vanguard being bought out, before SOE promptly bought the rights to Vanguard.

Items of note in the current SOE buyout rumors:

1. Smedley first denied the buyout by posting on a 3rd-party site, EQ2flames. No, he did not choose his own blog, the official EQ2 website, or filter the information through his community managers. Nope, he posted a denial on the most prolific Everquest 2 rumor-mongering website on the net.

2. The parent company of SOE, Sony Pictures, has been all but quiet on the matter so far. A denial from them would put this to rest quickly. Is it so hard to believe that Sony Pictures may have tried to keep this under wraps until after the holidays?

3. The "rumor" post was spread across several reliable, multi-national news agencies. Also, it spread quickly through several financial-related outlets.

4. SOE hired a former IGE bigwig to head up international relations. He just so happened to have recently visited India. Of course, this lends credibility to the idea that SOE may be working on a deal in India, not necessarily being sold.

5. The reported sales price of $300 million is questionable if the reported revenue of SOE is $150 million yearly. However, this wouldn't be the first case of an online-based company being bought for significantly more or less than their current revenue value.

6. Lastly, if the recent report on MMORPG subscriptions holds any weight, most of SOE's online games have been bleeding subscriptions.


Yes, I like to stir the pot.

6 comments:

dizzarian said...

Why is it hard to believe?

Because unlike the mergers you cited this is a small company saying they "bought out" one of the big players. If were a merger between two of the big companies it would have been believable.

point 2) Sony has denied it to reuters http://www.reuters.com/article/businessNews/idUSBOM23545920071223

point 3) The rumor may have been posted everywhere but were all cited from the same india times paper no other sources

point 5) it would be the first case of a profitable proven online company being out right sold not merged.

point 6) they don't hold much weight and as your previous point states SOE is profitable

not that I care in the least one way or the other, I just chalk this up as silly internet rumor perpetuated by this company zapak to drive a little traffic to their free gaming site.

heartlessgamer said...

Ummm the richest man in the world owns said "little company".

And I never said these weren't debatable, but I just found it a bit laughable that people so easily tossed this aside.

Also your third point is really splitting hairs on mergers and buyouts.

Corny name said...

Hmm,
Well, Zapak is owned by a company that's could scoop up SOE without blinking, that's true..
But would SOE sell for $300M? that's ridiculous.

Looking back at the track record of both companies, I'd say this was a clever PR move by Z, taking advantage of negative-SOE sentiment on them interwebs.
Good use of the rumour machines, still no good content though on Zapak :)

RadarX said...

Because this isn't the first time the industry has seen this type of guerrilla PR movement?

It got Zapak some free advertising. They threw a big name out there and the sharks just snatched it up.

RadarX said...

Because this isn't the first time the industry has seen this type of guerrilla PR movement?

It got Zapak some free advertising. They threw a big name out there and the sharks just snatched it up.

Grimwell said...

Debunking is fun:

1. Smed has always been a take charge kind of guy. Just because he decided to post on a rumor site don't think he was in a panic.

2. Sony Pictures may not have commented because there was no deal in process and they didn't know about the hoopla until SOE had it handled. At which point, why bother to even talk?

3. It spread across legitimate news sources because of the financial end of the deal. That tends to get those folks excited.

4. We ARE working on a deal in India. Dig back to about September. It was announced that we are working on an Indian IP from a comic book (in India) that retells some of their traditional mythology in a future form. We are going to make a MMO for that property. So yeah, he'd have a reason to be there.

5. I am not privy to all the company financial, but 300 million is pretty low for a successful (and profitable every year) MMO company.

6. We aren't bleeding subs. I used to be fascinated with pouring over Bruce's site, and anyone else who would try to sort out subs/etc. in the market. Then I got the real numbers and realized that even as a frame of reference, those public guesses aren't useful. See item #5. Profitable every year... :)

Mind you, I'm fully aware that in the world of business, SOE is just another successful company, so anything can change in an hour, but this one... right on the heels of us all going on holiday break... it's just a rumor that took off when someone got confused about us going into business in that market.

Things like that happen.

Tinfoil, denied. :)

All of that stated, I don't blame you (or anyone) for questioning the info. I sure would. ;)