Lunarorbit
Member
Seriously. Embracer group was always super sketchy
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Embracer will cancel games and close more studios to save costs
- Thread starter Thick Thighs Save Lives
- Start date
- News Business
Elder Legend
Banned
Their titles don't fit the Sony style games. Titan Quest 2 is an ARPG. Deus Ex is an FPS. Xbox has always been a home for WRPGs and FPS titles and needs to continue to be.
Sony already has Uncharted. MS needs Tomb Raider to counter.
R6Rider
Gold Member
Deus Ex is NOT an FPS.
Vox Machina
Banned
I doubt MS will be allowed to buy another medium/large Publisher, or even that they want to after absorbing ActiBlizz. They should, however, make some strategic IP purchases and individual devs with whom they have a pre-existing relationship. If Embracer is willing to part with Crystal Dynamics (doubt, they're already getting paid by MS already for CD devs), then that would be a good pickup.
Vox Machina
Banned
Sure, but I was more referencing the fact that EA has a tendency to scoop up underdog companies, use them until their last drop or lock them in a closet to do nothing, and then throw them into a garbage bin.
Westwood
Elder Legend
Banned
You are kidding right? Pretty sure when a gun takes up about 25% of the screen the game is an fps. Let me guess you're going to try to correct me and tell me its an immersive sim. Similar to Prey and Dishonored. Regardless, it's an FPS with a variety of RPG elements. What's up with people trying to play "Gotcha!" On this forum l lately? Lol. Redfall and Deadthloop are also FPS games with similar mechanism.
Generally speaking Deus Ex is an FPS. If you want to get super technical then I guess it's an immersive sim. But that's irrelevant because the game is 100% of the time in a first person view with a gun and you are pointing and still shooting for the most part. It's an fps.
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Buggy Loop
Member
Yes bruh
What the fuck did Eidos get into.. from management fucktards at Square Enix into Embracer group making cuts.. I fear for em
Elder Legend
Banned
I really think you underestimate the power of $$$. I doubt they wouldn't be allowed anymore to buy studios. Maybe for a limited time? Sure. Then again, I am not a lawyer and have no clue how those things work. So my opinion on that is probably not a very valuable one.
If MS is going the selective approach then they should just buy Crystal Dynamics. It would make a lot of sense for them from a strategic standpoint with them co-developing perfect dark.
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Paperboy
Member
Through their acquisitions they usually bought a group of developers for the IP rights and the more prominent studios. Some lesser known, not as succesful studios came with the package. It's not strange or unusual to trim the 'inventory' and merge abundant developers/publishers some time after. The studios they are closing down are those most people never heard of.
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Saiyan-Rox
Member
Vox Machina
Banned
I mean clearly they can afford, well, pretty much anything they want. It's not about the cost. Personally I just think that regulators would draw a distinction between publishers and individual developers when making market concentration arguments. Sony has been able to buy individual developers without even so much as a sniff from regulators, I think partially because of that very distinction.
Plus Microsoft has had to "hold separate" Zenimax (and ActiBlizz, when and if that merger consummates) for some time because they're publishers which GREATLY limits the amount of integration they can have with Xbox and XGS proper, something that they wouldn't have to do with individual studio mergers.
coffinbirth
Member
Embracer, or any other large publisher for that matter, peeling off IP/studios and selling it to Microsoft is probably how we'll see things go down in the short-term. Not nearly as much, if any, regulatory scrutiny going that route in the wake of the ABK deal.
Vox Machina
Banned
I mean losing a $2 BILLION dollar cash infusion is going to have a LOT of repercussions for pretty much any business.
Yeah I bet we'll see publishers be more willing to sell individual IPs in the medium term as development costs keep rising and the money gets tight. Some publishers just don't have the development expertise for certain IPs they're sitting on and some may just make the call to separate with them to keep their profitable stuff moving forward. I'd kill to see the Command & Conquer franchise resurrected this way. I don't have any trust in EA to do right by it AT ALL.
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Clear
CliffyB's Cock Holster
Sound to me that Embracer is all about "flipping" IP and studios for profit more than anything else.
No real plan for product, just use its portfolio to leverage deals with big partners.
Kinda alarming to tell the truth that they feel that what they've acquired is only worth preserving with an external suitor to make it worthwhile...
No real plan for product, just use its portfolio to leverage deals with big partners.
Kinda alarming to tell the truth that they feel that what they've acquired is only worth preserving with an external suitor to make it worthwhile...
StueyDuck
Member
everyone get your G-Fuel and Buster sword replicas... it's time
Vox Machina
Banned
Did you miss the part where Savvy Group left them with a $2 Billion hole in their pocket? That amount of money wildly changes the trajectory of a business. Hard times call for desperate measures.
Clear
CliffyB's Cock Holster
Why were they banking on a $2b deal to MAINTAIN their existing business?
Paperboy
Member
I don't know why you would come to that conclusion. They released Saints Row last autumn, recently resurrected System Shock and before the end of this year we will (finally) get a sequel to Warhammer 40,000: Space Marines.
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64bitmodels
Reverse groomer.
I don't know what else to say. they acquired all these IPs and studios and then just started closing them to save costs. It is nothing but a bruh moment.
coffinbirth
Member
Not really what happened, but sure.
Hudo
Member
Sure but this feels like they were essentially gambling. Like buying all these studios without really having the finances to support them but having this deal, which had not been closed, at the horizon. So they speculatively bought these studios. And now the deal fell through. Dunno, but if I were an investor, I'd be saying "yo, what the fuck?".
R6Rider
Gold Member
You're simply wrong, but that's okay.
The fact that you think you are always 100% in first person view just proves my point. You leave first person view very often.
Mokus
Member
But it's true, Deus Ex it's not a shooter. It's a First Person RPG: Oblivion, Skyrim, Fallout 3 and 4. It was one of the earliest to adopt this gameplay style whit a gun in the hand. Later first person shooters (Far Cry series) would implement in their gameplay RPG elements, especially after the success of Bioshock.
Unknown Soldier
Member
Embracer speedrunning buying everything and then declaring bankruptcy
Elder Legend
Banned
The only Deus Ex game I've played was Deus Ex Human Revolution. If I recall, majority of the time you are in First person view. I never played the OG ones, so I don't know if those were any different. I remeber there being some hacking mini game, and you could either do full stealth run or guns blazing if I am not mistaken.
Clear
CliffyB's Cock Holster
The cutbacks are primarily to reduce CAPEX, capital expenditure. Meaning that prior to cuts they are running their businesses at a loss, entirely normal on a per studio basis because until you have a product on the market you cannot generate ROI.
However in the context of a large portfolio of studios it indicates to me that they acquired more than they could support, and did so knowingly because the revenue stream from a game studio mid-cycle is inevitably and predictably non-existent. So the obvious question is why would they take on such short to mid-term risk knowingly?
Their business model -as described by Lars Wingefors- was to distribute risk by concurrently developing literally hundreds of titles and by so doing distribute the risk across the group.
Basically they are throwing as much shit at the wall they can, and hoping enough sticks to keep themselves afloat! A strategy entirely at odds with the prevailing wisdom established by Activision and Take Two of focussing down to as few titles as possible, backing and marketing them to the hilt, and using these as tentpoles to uphold their entire operation.
The upshot of course is that further investment is based on turnover plus projected income to be generated by the aggregate of every IP and product they have in the pipeline as potential future sources for income.
These cutbacks are what happens when the rubber hits the proverbial road. When current income fails to reach expectations, it casts doubt generally on the ability of future income to exceed expectations and investors pull out because the risk becomes unpalatable. So in response they have to cut CAPEX by shuttering studios and projects, reducing potential future income expectations and the system that has hitherto been rolling forward with its own momentum risks being thrown into retrograde.
I've sadly seen this before, and its the reason why so many mid-sized European publishers ended up going to the wall.
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CamHostage
Member
Sad. Embracer was one of the few old-timey publishers putting out a shitload of product across all platforms and genres, and they made a lot of crap, but by percentage there's a good amount of people satisfied with their purchases.
Because they're THQ, and this is their way of things.
They were also trying to get big fast, and probably there was the notion that cornering so many different markets would give them a lot of strength in range. (Many of these studios were also on the market after the publisher market dried up, and so they may not have the strength or manpower to go after major contracts and brands and shop their creations each on their own. Nobody else was buying, and the other option was to operate fully independently, which is precarious work.)
Because they're THQ, and this is their way of things.
They were also trying to get big fast, and probably there was the notion that cornering so many different markets would give them a lot of strength in range. (Many of these studios were also on the market after the publisher market dried up, and so they may not have the strength or manpower to go after major contracts and brands and shop their creations each on their own. Nobody else was buying, and the other option was to operate fully independently, which is precarious work.)
Vox Machina
Banned
Money was, for businesses, essentially free when Embracer was on a spending spree. I doubt they were speculative, but their situation has changed tremendously and there will be ramifications because of that. I'm sure the Embracer C-suite is getting phone calls daily from their big investors essentially asking "okay what the fuck is the plan now".
Vox Machina
Banned
Running a business involves making calculated risks. This one obviously backfired on them and now they'll have to downsize areas of their business and, yes, potentially sell some assets. They aren't going bankrupt, lmao. If Sony/Xbox/Nintendo suddenly lost $2 Billion in revenue you can bet your ass those businesses would see some rough changes in the short term for them too, and they're all way more diversified than Embracer.
thicc_girls_are_teh_best
Member
That's only because Microsoft actively have projects with those studios, so they're likely funding the games with them. Or, co-funding them, so much less financial investment from Embracer itself.
If those games bomb, though? Well either Microsoft buys the studios or Embracer shuts them down. Would effectively be the same thing at that point though.
Thick Thighs Save Lives
NeoGAF's Physical Games Advocate Extraordinaire
No. It's not just the MSFT funding though. There's multiple factors at play.
"It is encouraging to see that Crystal Dynamics - Eidos's turnaround to solid profitability is ahead of plan, driven by cost efficiency improvements, a stable back catalog business and increased external funding for ongoing development. This is a testament to the commitment and focus of Crystal Dynamics - Eidos's management, and is supportive of our larger PC/Console business."
Then there's also the Amazon Games publishing deal signed in December of last year for the new Tomb Raider game being developed by Crystal Dynamics.
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ChoosableOne
ChoosableAll
MrTroubleMaker
Member
I'm guessing whatever is left of Volition will be gone. I hope the "Destroy All Humans" team survives, they did a good job.
Elder Legend
Banned
Volition deserves to go bankrupt after telling their fans to fuck off and keep on doing all this sjw nonsense with Saints Row. So glad that shit game bombed.
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bender
What time is it?
I love Don Mattrick quotes.
Paperboy
Member
It's the sensible thing to do, to try different things to see what's works and what don't. If a publisher has a lot of studios then there will of course be more (and diverse) projects in the pipeline. You can focus on one or two franchises like Take Two or Activision when you've struck gold, but it isn't viable in Embracer's case. They've spent a lot of money because of the acquisitions but Lars recently said that the buying spree is over and it's now time to put emphasis on supporting upcoming games and developing the IPs.
ReBurn
Gold Member
MrTroubleMaker
Member
yeah the newer team did a
job, to bad what happened to the legacy, the original SR and RF are great games.
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Paperboy
Member
Yeah, well, if no one bought those struggling studios from Square Enix for example they would all be closed down today. Embracer got them for cheap for a reason. Most of Embracer's IPs had their hayday 15-20 years ago, it will require a lot of love and patience to see the fruition of all those purchases.
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Elder Legend
Banned
Plot twist: I am secretly Don Mattrick.
ShaikhCroft
Member
Please not Tomb Raider!
bender
What time is it?
Thick Thighs Save Lives
NeoGAF's Physical Games Advocate Extraordinaire
It's safe, Amazon is fully funding a new Tomb Raider game. They also have other big plans for the IP with both a TV show and and a movie being in the works.