Amazon is not going to make a bid for Electronic Arts – sources
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If they buy EA and bundle their sports games with ESPN+ and ESPN branding. They might have more strength in the bidding wars. It would make subbing to ESPN+ worth it because they now would include the games.
EA also works on Star Wars games. They get popular games like Sims and Apex Legends.
They would also get access to the Frostbite engine, and game engines rendering on a large LED screen seem to the better than green screens in visual effects.
[0]https://arstechnica.com/gaming/2011/07/id-softwares-john-car...
...and it would still be accurate.
So whether this is true or not I think it makes sense. The negative about ea is I see them as a middle man when it comes to licenses. They own the Madden brand but they still have to pay the NFL to make games for it. Same with all their other sports. Same for Star Wars games.
This is where the line gets trickier:
- Less government on things that matter; - Enough government to avoid big corps from creating monopolies.
Finding this middle ground is proven to be really, I mean really difficult, to say the least.
It's a gigantic corporation however, so i don't doubt that some of their teams had good working conditions even in 2002 as you said.
Amazon: "What do you mean everyone?"
Jeff: "EVEEERRRYYYOONNEEE"
TIL that Gary Oldman improvised his delivery of that line -- in this short clip[0], he says he was fooling around, doing it that way as a joke, and the director kept it:
[0] https://www.youtube.com/watch?v=MZfqez5qmuA
</tangent>
I wonder how well such talent is compensated by the incoming tech giants..
Now if we only had Amazon in my country...
https://www.amazongames.com/en-us/support/prime-gaming/artic...
(Answer: There is no anti-trust case. Just because Amazon is big doesn't mean it's big in the video game industry. Companies are allowed to be big across multiple industries. It would only become an issue if it already owned a big percentage of the video game industry, or if it buys up other publishers after this, like Activision or Tencent. Speaking of which, Microsoft intends to acquire Activision, which will make it the 3rd largest gaming company behind Tencent and Sony - and Amazon + EA will be trailing behind those still).
I suppose it makes sense, investors want their investment to be safe, by diversifying through acquisition they can give that to shareholders.
For the other rumoured purchasers, Disney and Apple, would have a direct affect on their business strategy. Disney as a media asset business, and Apple though the potential to expand their Gaming strategy on their own platforms.
EA would give them control over a core library of content and IP, that they could use to (a) ensure continued access into home consoles for their other products, (b) run as a game on demand service attached to Prime, or (c) make exclusive to launch their own console.
And it seems like the sort of business Amazon likes: good profit margin trend line, but more valuable within the Amazon ecosystem than outside it.
I was thinking Mitsubishi. Powerplants and ships would be helpful to them.
In high school, I was thrilled that my DVD player had the same logo as my friend's motorcycle.
In that movie, Costco pretty much does everything.
no, really
They always wanted to be Sears but in the online world (who had their own credit card, Discover, their own branded product like Craftsman/Diehard/Kenmore/etc).
Next year's EA soccer/football game is going to be called "EA Sports Football Club" "EA Sports: FC". It'll be a big gamble, but I think EA is betting that they'll save money in the long term even if they spend a ton on marketing.
I mention this because I wonder how much these sports licenses are worth after the video game is well established.
FIFA is not the only football games, PES exist too with fully licensed leagues. Some of them shared between both.
MLB has right now two licensed games (RBI and The Show)
NBA, NHL, and NFL had multiple games between 2K (2K Sports) and EA.
It really comes down to who is willing to pay the enormous fee.
Stadia is fantastic but it lacks games.
A subscription service that streams games + allows access to it on dedicated gaming hardware such as a console/gaming PC is likely the market amazon wants to attack here.
With all that impressive infrastructure to get physical product to you overnight or same day, it's still a better and much much more profitable platform for digital goods.
2, Amazon runs the platform that people use while playing the games - Twitch
3, Amazon runs the platform that hosts the servers to play the games - AWS
4, Amazon runs the platform that you play the game on - Luna
5, Amazon runs the platform that creates the games - EA
how is this not anti-competition for anyone running a company that competes in only one of these fields..
Though I suspect the claim that "We at least compete with this other giant tech company hell bent on crushing competition" is probably not the most sympathetic argument in the current antitrust atmosphere.
What current antitrust atmosphere? What was the last trust busted?
Like with the mainstream media and the fact that no one has put the Murdochs in a rocket to Mars
https://www.nytimes.com/2022/07/28/technology/ftc-lina-khan-...
1) that's only available on Luna sold via Amazon
2) DLC only downloadable with Twitch participation/Prime membership
3) Amazon force EA to use AWS
Instead of making their product compete with their 'competitors', they buy the customers (EA) and force them to use their product. At that point, taking AWS for example, GCP/Azure are no longer 'competitors' and if the end-consumer (me and you), want to play a title, we pay extra because there's no competition in the chain...
If both were to cooperate and segment their markets in secret, it would be highly anticompetitive.
It only takes one mistake for them to lose a lot of that engagement.
How true is this? Because YouTube and Google have made plenty of mistakes yet it continues to dominate.
However, critical mass is very hard to move, because platform switch would be revenue loss for streamers.
"The Games" - No. Some games yes. The people I game with pretty much despise EA and look at them as the company that buys up smaller studios and destroys the culture.
There's also BioWare - but their last few releases have been disastrous.
Edit: Oh, more recently I loved the Command & Conquer remaster - that maybe counts as an EA game? It was published by them, but I don't think Peteoglyph is owned by EA.
They also have what's basically a renegade sequel
The FTC probably knows it is overdue to break up the Big Tech takeovers, but needs more evidence of this consolidation and behaviour to outright prevent more of this and eventually break them all up.
It's a lot harder to regulate 1000s or multiples of 1000s of smaller businesses.
Regulation also includes targeted political censorship in this case.
Workers had no other options but to live in that company town and spend their money in company town stores.
All vertical integration means is that a company has direct control over most/all of the supply chain they need to get their product made and sold. They don't need 3rd parties to supply them with any of the steps in the process.
That obviously gives them a competitive advantage, but it doesn't involve directly removing other competitors the way horizontal integration does.
I think there’s a certain point where executives run out of ideas but have to be doing something. Then you have investment bankers and advisors pushing these ideas and copycatting each other for that sweet, sweet commission payday.
And it’s not so much that these are great ideas, it’s can they sound okay enough to get that payday before everyone realizes it was all a stupid waste of time five years later. That is, after the acquired company gets its souls sucked out, the talent leaves, and the acquirer discards the husk at a discount.
This is a self-correcting phenomenon.
The issue isn't Amazon buying something. The issue is Amazon buying something to force them to use their services hence circumventing competition.
EA may previously have used GCP to host their services because they provide a better service and are cheaper. This forces AWS to do better to compete against GCP and the end-consumer purchasing the game will pay less.
I think it would be way easier to make a case that Microsoft shouldn't be able to buy Activision. It seems like major gaming studios are slowly getting acquired by either Tencent or Microsoft
Anti-competitive practices are business or government practices that prevent or reduce competition in a market.
Amazon purchasing a company and forcing them to use their services means their services no longer have to compete against their 'competitors'...
But also: do they disallow competitors to use their services/sell their games? AFAIK antimonopoly litigation requires the existence of an actual market obstruction, not its hypothetical existence.
It's fairly well established that vertical integration is not only not anti-competitive, but benefits both corporations and consumers.
I'm going to need some more details before it being accepted as a fact...
Vertical integration should be pursued by any and every company.
The alternative to VI is every single piece of your stack is another company seeking its own piece of whatever pie you’re building (and that company in turn facing the exact same dilemma — nobody builds original things anymore, it’s b2b saas Lego all the way down)
I'm suggesting the optimum for human freedom, welfare and prosperity is achieved when striving closer to the former rather than the latter, not that companies should strive to depend on others as much as possible.
(Though my use of "minimal" in the original post might've been misleading.)
It is illegal for businesses to act together in ways that can limit competition, lead to higher prices, or hinder other businesses from entering the market.
That's from the FTC.
I understand that enforcement is hard as the rule wouldn’t be global, but still curious.
it would be great if we could first put a cap on the biggest culprit: government.
This point would make more sense if I could vote for the leadership team at Amazon.
Perhaps. Perhaps initiatives likes these are bound to fail. Not sure how many lives have to be destroyed until people get "statistically significant" results.
The burden of proof is on you. How does this stifle competition? Why can't Amazon own EA? A gut "they'll be too big / successful / profitable" is not enough.
Why would you want to put an upper cap on the size of companies? It feels like stifling innovation and productivity, which will be overly negative for everyone.
In practice, large companies have been able to use their leverage to influence political outcomes and antitrust laws have not been enforced. It's good that we have laws to ensure a free market, but they're not much use if they're ignored.
In this case, I'm not sure that Amazon acquiring a video game company does much to hinder competition. There are lots of indie video games and I don't see that Electronic Arts has any particular technology that locks in customers or excludes other vendors.
As a society we absolutely should be vigilant against concentrations of power, foremost of which are the big tech companies. But when it comes to monopolies, there are more significant things to worry about than this particular acquisition.
From a business perspective that might be partly true. But anti-trust / anti-competition policies are not just to provide a level playing ground for businesses but also consumers. A giant conglomerate might have a higher productivity, but that doesn't mean that benefit will be passed to the consumer unless they have rival businesses to compete with. Competition promotes more innovation and is more socially beneficial to both businesses and consumers than giant conglomerates that just become obese and unhealthy after a point.
What am I missing?
Yes, plenty of annual sports games, though even those evolve over time with different career modes and gameplay. But EA is still making moves in the space.
Once again, how can someone define an 'upper cap', is it market size? Is it revenue, or employee count? Market share? The unintended consequences of an upper limit doesn't seem to me something we should be encouraging.
I could be wrong, it just feels like we shouldn't be restricting everyone because of one bad actor.
Meanwhile, companies that leverage existing technologies in new ways can be innovative with much fewer resources - e.g. your typical web startup.
How would you measure “size”?
EDIT:
What do you mean by "cap" then? Would you force the company to be broken apart into smaller independent companies if it exceeded whatever cap is defined?
Taxes are on earnings though, not revenues (you could be unprofitable and as such, pay no taxes).
Question: so are you suggesting then that just because a company's revenues (I think you mean "earnings") have exceeded X, that they should be completely broken up as a company?
Yes. But I meant revenues. If we want companies to become smaller, taxing their revenue progressively would compell their owners to split them up into independent entities. Think about it as a progressive VAT.
If you can rake in billions using a team of 50 people, that is great, and should be allowed.
Also, a company like Apple should be allowed. What should not be allowed is for Apple to own its entire supply chain (which would not be possible if company size was limited by number of people).
Consulting businesses are literally in the business to resell their employed talent. Their "product" is their employees.
As such, they type of business by its very nature have a disproportionately large number of employees. E.g. Accenture employees 700,000 people, Tata Consulting 600,000.
Do you mean "earnings"?
A company as big as Amazon exists across thousands of communities, and in contexts that don't even include communities. It can afford to harm some contexts while profiting on others, because it is a monolith. That's why when we talk about business law we need to consider more than just the simple economics, because companies can have greater impacts than that.
Anti-competitive laws are just that, they're not about increasing simple metrics, they're about managing the harder to measure externalities of bigger companies like the ability for a market to be competitive, promote innovation, and to make sure customers have enough choice to choose with their wallet.
I'd say they make it easier to make mistakes in reasoning. Just as unilaterally deciding what "we're" talking about is also a mistake.
Positing that Amazon is too big to buy a computer game company is just wrong. This in no way creates a monopoly on computer game creation, which is one of the best industries on the planet in terms of lack of lock-in in the forms of regulation, machinery, or IP law. Have computer, download Godot, get going.
Also, Amazon is a silly company to level that charge at. They in no way control a significant amount of the game creation industry. You may be thinking of Microsoft.
Seeing how they handled New World and how they currently handle Lost Ark...
For anyone unaware, Lost Ark has a serious bot problem and the answer from AGS is to act in a way where the primary impact is felt by legitimate players.
Lost Ark makes RuneScape's history of botting seem minor in comparison.
The game is fun until you reach the point where the botting becomes impactful. Up until that point you can enjoy it for free with minimal impact from bots minus the inability to farm some horizontal progression content.
You must enter the Amazon Voluntarily Submission Chamber. You have 30 seconds to comply. /Robocop nightmare.
Edit: Can't believe you got downvoted :(
Huge companies buying every major studio is definitely a "dick move" (lack of a better term), but it's not a monopoly, and it never could be. Some of the most impactful games of the past 5 years were released by small teams and amassed cult followings.
Also, where did you get that definition of "monopoly" you quoted? There are a lot of definitions of that word flying around the internet, so I'm curious if you got that from like the FTC's website or something? I'm wondering because back when antitrust law was created, the issue at the time was railroad companies monopolizing transportation; however, what you're saying about indie games could also be said about transport: trains are not a monopoly, and they never could be as long as horses still exist!
> As long as games, as a commodity, can be created out of "thin air" (code)
Games are not created out of "thin air", they're created through very expensive labor, which is not only programming.
We need a commission cap on all platforms that do over $1billion in annual sales. The Apple vs Epic trial revealed 80% margins for Apple on the App Store:
https://9to5mac.com/2021/05/01/apple-runs-app-store-with-78-...
A cap of 10-15% should do it.
Like on iOS, if there was actual competition for app stores, Apple would face pressure from a competitive market to reduce their commission percentage. Developers will not want to put their apps/games on Apple's store if they continue to charge outrages fees, and they have alternative, realistic distribution options.
However, I don't know what regulation would look like there. Even if Apple is forced to allow third-party stores, it could still end up like the browser wars, where one company manages to secure a monopoly anyways. If we can't even fix the browser situation, I don't have high hopes for the appstore market.
Countries around the world already regulate pricing on things like Credit Card transaction fees. This should be no different. In Australia for example:
"Each scheme's average interchange fee, weighted by the value or volume of transactions in each interchange category, is required to be below a benchmark of 0.50 per cent for credit cards, and 8 cents for debit and prepaid cards."
https://www.rba.gov.au/payments-and-infrastructure/review-of....
US anti trust looks at harm to consumers, meaning does this reduce competition amongst game makers, and the answer is obviously no. This isn't two gaming companies merging. This is one unrelated company acquiring another. Us and European anti trust don't look at the size of a company as a factor.
That has been changing very fast, this Economist article back from the start of this year touches on that aspect (among other things): "The growing demand for more vigorous antitrust action" [1]
After what they did to Halo I'm not holding my breath.
Edit: I also didn't expect them to use the people who did voice acting for the game, but it's bizarre to me that they decided to get Jen Taylor to voice Cortana but didn't decide to cast her as Halsey. Would have made more sense to just have the lady who played Halsey voice Cortana as well, since Halsey modeling Cortana after herself tells you a lot about her character and her overinflated opinion of herself.
I wonder what’s driving the desire to buy up video game publishers. There probably aren’t many left at the scope of the ones already bought or in a deal that are practically purchasable, even for big tech players.
Amazon probably wants game publishers so they can harden their monopoly on game streaming with Twitch.
Maybe they want to get into the Cloud gaming space too.
Don't forget Sony recently bought Bungie, too. It seems like it's just another wave of consolidation
If only he had a track record to weigh.
The killer app that would make VR desirable doesn't exist yet either. Maybe that will be the Metaverse? But I kind of doubt it. We'll see.
How could I have know in advance that it would have been a strawman of your opinion? I didn't know you existed until a second ago.
I can hope this means an improvement, maybe EA will finally allow some older games to be open sourced or fixed.
Been trying to convince EA for years to do something about SimCity 4.
https://www.reddit.com/r/wallstreetbets/comments/w6bgpz/who_...
Edit: In case you don't know, 'Retard' is a friendly self-deprecating title proudly used by many at wallstreetbets.
For News confirmed by the BBC and denied by CNBC...If I was the SEC, I would be all over any recent moves on this stock.