Sony Online Entertainment (Everquest, Planetside 2, H1Z1) purchased by private firm

[Dulanic]

Seconded. Columbus Nova is a venture capitalist firm with no knowledge or experience running a game development company. Unless they remain completely hands off and funnel money into Daybreak, the company will be gutted, striped, and sold off piece meal so CN can recoup their investment. It has never been a good thing for a company to be owned by a private investment group.

^^ This. Venture capitalists are out for one thing, short team profits. I've watched them swoop up many companies personally, and it has always resulted in the same thing... splitting apart a company and selling it in pieces.

 

[ThinClient]

Seconded. Columbus Nova is a venture capitalist firm with no knowledge or experience running a game development company. Unless they remain completely hands off and funnel money into Daybreak, the company will be gutted, striped, and sold off piece meal so CN can recoup their investment. It has never been a good thing for a company to be owned by a private investment group.

Why would they need to funnel money into Daybreak? SOE has been profitable on their own. Now that SOE isn't restricted to PC and Playstation, they can make games for other platforms, likely increasing profits even further. Why would CN gut and destroy a profit factory? This isn't a rational fear.

 

[gothamhunter]

Why would they need to funnel money into Daybreak? SOE has been profitable on their own. Now that SOE isn't restricted to PC and Playstation, they can make games for other platforms, likely increasing profits even further. Why would CN gut and destroy a profit factory? This isn't a rational fear.

Hmm...last I read they had something like a $60 million write-off for SOE from poor sales...

 

[soccerballtux]

This is everything SOE. This is everything that involved game development with Sony's name on it, excluding the actual Playstation console which is still staying with Sony and was not part of SOE to begin with.

ok, so now no Playstation exclusives, PlanetSide2 goes to Xbox1, ... big mistake from the console loss leader perspective.

 

[ThinClient]

Hmm...last I read they had something like a $60 million write-off for SOE from poor sales...

Link? I have folks telling me otherwise. Would be interesting to read if you can find a link.

 

[norseamd]

Well that did not take that long just mere days.

"As part of a strategic decision to rationalize the business, Daybreak Game Company announced today that it will eliminate positions in both its San Diego and Austin studios. This alignment of resources better positions the newly independent studio for future growth opportunities and developments, including delivering on its legacy of making top online games and establishing a solid foundation for future multi-platform success,"

http://www.pcgamer.com/daybreak-games-formerly-sony-online-entertainment-making-layoffs/

 

[ThinClient]

Meh, SOE has gone through half a dozen downsizes in the past few years anyway. Apparently some folks still there along with many who aren't say that this helped get rid of a bunch of bloat and poor structure that SOE wouldn't get rid of but needed to for a long, long time.

 

[psychosiz]

^^ This. Venture capitalists are out for one thing, short team profits. I've watched them swoop up many companies personally, and it has always resulted in the same thing... splitting apart a company and selling it in pieces.

Agreed, this is what I have seen over the years as well. I have been party to a company being purchased by venture capitalist and experienced a job loss and saw our company gutted soon thereafter.

 

[gothamhunter]

Link? I have folks telling me otherwise. Would be interesting to read if you can find a link.

Here's one:
http://recode.net/2014/05/14/sony-misses-fiscal-year-expectations-with-profits-down-88-percent/

Really just google 'SOE $60 write-off' and you'll find a bunch

 

[ThinClient]

Here's one:
http://recode.net/2014/05/14/sony-misses-fiscal-year-expectations-with-profits-down-88-percent/

Really just google 'SOE $60 write-off' and you'll find a bunch

That $58 million was writing off MMOs and other games that hadn't finished developing yet. Before finishing the product, they realize that they wouldn't be profitable and cut their losses.

What's wrong with that?

That doesn't mean that they didn't turn a profit that year. lol.

 

[JTsyo]

PS2 is the only game I currently play from SOE. The layoffs has many of the players in the doom and gloom mindset. Can't say I blame them. How are you going to keep developing the game when you layoff half the people?

 

[Fanatical Meat]

I was concerned about EQ Next however I had hope it would bring back some fun time admittedly I though there was a great chance it would be another easy mode MMO. I now have lost interest in it.

 

[ThinClient]

PS2 is the only game I currently play from SOE. The layoffs has many of the players in the doom and gloom mindset. Can't say I blame them. How are you going to keep developing the game when you layoff half the people?

Because Devs weren't the ones laid off. According to people who still work there and some who don't, a lot of bull positions were eliminated that needed to be eliminated for 20 years. There was a lot of poorly structured management and needless positions that went bye bye but all the people that need to be there are still there.

Like, stupid customers would call in to whatever number they could find and talk with the phone tech about stupid junk that didn't need to be talked about, like I WANT TO TALK ABOUT BALANCING CLASSES, SINCE YOU HAVE NO OTHER CUSTOMERS TO TALK TO OBVIOUSLY or HEY LETS TALK ABOUT SOME IDEAS I HAVE FOR GAMES kind of garbage.

People would literally call in to their financial services line to complain that someone was mean to them in-game and would whine about garbage for an hour. I'm concerned that I won't be able to talk to someone on the phone about financial issues if I have them, but you can still do that via email. I understand, though, when they have to decide whether phone support stays and they continue to deal with the bull or just cut it and force customer interactions into more manageable segments.

So now, no more support for anything other than email. The same hour-long call can be completed in 2 minutes via email, lowering their work load and reducing the amount of bull that they have to deal with from customers.

Redundant jobs were removed but people who need to be there are all still there.

 

[ThinClient]

I was concerned about EQ Next however I had hope it would bring back some fun time admittedly I though there was a great chance it would be another easy mode MMO. I now have lost interest in it.

Why? EQNext development hasn't changed. LOL.

 

[Subyman]

^^ This. Venture capitalists are out for one thing, short team profits. I've watched them swoop up many companies personally, and it has always resulted in the same thing... splitting apart a company and selling it in pieces.

Depends on where this slots into the portfolio. Some are looking for consistent cash flow. It isn't always all-or-nothing in investing.

I heard on the Giantbombcast that SOE will be realigning to get into mobile... I hope that does not affect its MMO side, I doubt it would since that is a decent revenue stream. I wouldn't be against some casual games in the EQ world. Could be fun.

 

[maniacalpha1-1]

Because Devs weren't the ones laid off. According to people who still work there and some who don't, a lot of bull positions were eliminated that needed to be eliminated for 20 years. There was a lot of poorly structured management and needless positions that went bye bye but all the people that need to be there are still there.

Like, stupid customers would call in to whatever number they could find and talk with the phone tech about stupid junk that didn't need to be talked about, like I WANT TO TALK ABOUT BALANCING CLASSES, SINCE YOU HAVE NO OTHER CUSTOMERS TO TALK TO OBVIOUSLY or HEY LETS TALK ABOUT SOME IDEAS I HAVE FOR GAMES kind of garbage.

People would literally call in to their financial services line to complain that someone was mean to them in-game and would whine about garbage for an hour. I'm concerned that I won't be able to talk to someone on the phone about financial issues if I have them, but you can still do that via email. I understand, though, when they have to decide whether phone support stays and they continue to deal with the bull or just cut it and force customer interactions into more manageable segments.

So now, no more support for anything other than email. The same hour-long call can be completed in 2 minutes via email, lowering their work load and reducing the amount of bull that they have to deal with from customers.

Redundant jobs were removed but people who need to be there are all still there.

Georgeson was a dev, I would think? I saw a list somewhere that had position of those who left, but now I can't remember if it was on reddit or the EQN forum. Either way, surely some were devs, depending on the definition of dev. But I don't think they were just customer service people.

And even if PS2's devs weren't touched, it seems that PS2 has been stagnant in getting proper balance, new continents, the long-in-the-making resource redesign and so on...

 

[TeknoBug]

Private investment group = say good bye to quality Planetside 2.

 

[ThinClient]

But I don't think they were just customer service people.

Nah, I didn't mean to convey that idea. I don't think I did, either, but w/e. Just giving an example of why some of the departments were cut so deeply.

 

[shady28]

Seconded. Columbus Nova is a venture capitalist firm with no knowledge or experience running a game development company. Unless they remain completely hands off and funnel money into Daybreak, the company will be gutted, striped, and sold off piece meal so CN can recoup their investment. It has never been a good thing for a company to be owned by a private investment group.

This^^^. Anyone who thinks differently is fooling themselves and/or not very learned in the ways of hedge funds and activist investors.

 

[SunnyD]

Will Higby keep his job?

Pulled from the PS2 thread... according to this Higby has left the company.

I'm also hearing word that EQ2 devs are being let go en masse with the possibility that the game itself might be shut down.

Like I said in this post, private venture firms when they do this generally quickly move to trim waste and underperformance in order to maximize profit, identify valuable assets and put them first while gutting the ones that aren't worth the effort. There's usually a 2 or 5 year plan to make the company profitable and attractive to potential buyers at that time. Basically, think real estate house flippers. That's what companies like this do.

 

[ThinClient]

Except that SOE is already profitable. LOL

 

[norseamd]

And this is why despite all the good press Sony got for their appealing to consumers on the PS4 I knew that as a company Sony was not to be trusted.

 

[cyphilis]

Except that SOE is already profitable. LOL

Any investment group out there, is not going to invest in something that is not profitable. This buy out is not a good thing,.. like others have said, they never are.

 

[ThinClient]

And this is why despite all the good press Sony got for their appealing to consumers on the PS4 I knew that as a company Sony was not to be trusted.

What does that have to do with the company formerly known as SOE?

 

[exar333]

Any investment group out there, is not going to invest in something that is not profitable. This buy out is not a good thing,.. like others have said, they never are.

But what kind of profitability? Private equity groups can often purchase a company, gut the assets (physical and/or IP) and then dissolve it. The quarterly results or cash flow/profitability could be terrible, but they don't care because they are looking to cash it out and shutter the doors. This isn't always the case, but just an example.

Also, REAL profit numbers can be tough to really interpret when they are part of a larger organization like Sony. Did they get a discount on some key costs? Did they get a 'sweatheart deal' because of inside connections or common interests? These are all topics I am sure the firm looked into when it purchased it, but the numbers are not always representative.

Companies commonly use a shell game to move costs and profits around to make something more or less marketable.