Infogrames in financial trouble.

Oerdin · May 19, 2003, 19:35

I saw this and thought I might see if I could spark some discussion; especially since so many people here at 'poly accussed Infogrames of making excess profits off of Civ3 & PtW. Businessweek a while know and respected American financial journal is reporting Infogrames stock has plunged 98% from its high of last September and the company is on the verge of drowning in a sea of debt. Further more the Infogrames name has been so sullied by bad products that the French company is changing it's name to Atari Inc whom they had aquired last year when the stock was still flying high.

So what do you folks think? Is Infogreed reaping the rewards of turning out poorly sorted games like Civ3? Or is it being unfairly punished by the market?

Oerdin · May 19, 2003, 19:59

Supposedly Infogrames NEEDS their lastest Matrix game take off to be a hit or they go belly up. What do you think this means for future Civ3 Expansion packs or even a Civ4?

Flight · May 19, 2003, 20:44

firaxis are teh kind of developers who would be bought by anyone with the cash imo so i dont see any danger for reasonably long term games (civ4) but the xp might be ****ed

as for infogrames, who knows, i never much liked them anyway

bobbo008 · May 19, 2003, 20:50

i'm not sure about us losing the xp. i'm sure there's someone who'd be willing to buy the publishing rights to it.

does infogrames own firaxis?

VetLegion · May 19, 2003, 20:51

I have read the 'features' list for the new Civ III expansion and I think it is a ripoff. Is it Firaxis idea to publish it or Infogrames I don't know. Atari is a cool name, but it can not save a company.

Oerdin · May 19, 2003, 21:39

I'm with you VL on the Atari name change but I'm afraid they may tarnish this golden oldie name just like they did their current one.

I do think we'll still see out XP though I suspect its budget has been slashed as they've eliminated 50% of their future products and cut the budgets for 25%. The odds are realy good the XP is being put out on a shoe string. That means fewer features and fewer patches.

ALPHA WOLF 64 · May 20, 2003, 01:40

if they were smart, they'd sell of the civ francise now, since it has limited near term profitablity. I figure civ4 is at least 2 years away, and in one of the chats, firaxis said that a successful XP sells 1/2 of the previous release. So it seems that this release will bring in some money but not a big windfall.

statusperfect · May 20, 2003, 02:42

Quote:

Originally posted by Oerdin
So what do you folks think? Is Infogreed reaping the rewards of turning out poorly sorted games like Civ3? Or is it being unfairly punished by the market?

the punishment of the market is never unfair

cheers

Spiffor · May 20, 2003, 05:25

So, Lyons really ends with 's' in English ? It thought it was a consistent typo in Civ... Does Marseilles really ends with an 's' in English too ?

As for Atari's financial problems, this reminds me of Vivendi Universal. Unti a year ago, everybody wondered when Vivendi's paetite would stop, and what would stop the rise of Vivendi's CEO Jean Marie Messier. One year ago, Vivendi entered a serious debt crisis, and the CEO was laid off.

I think Infogrames will survive, even though they may not being able to handle being a world major anymore. The smaller French videogames company Ubi Soft is doing well, even though it doesn't play on the same scale.

As for Firaxis : Firaxis is a subcontractor of Infogrames. Infogrames owns the Civilization franchise, as well as other profitable franchise they can sell for a high price. However, Firaxis has just signed new agreements with Infogrames, that makes it more involved with the Lyons company. I think Infogrames values Sid Meier's company as a company that brings profit with little risk involved (but also not so many profits involved).
IMHO, that's why they haven't cancelled PtW development, and allowed Conquests development.

WarpStorm · May 20, 2003, 06:07

Quote:

Originally posted by ALPHA WOLF 64
and in one of the chats, firaxis said that a successful XP sells 1/2 of the previous release.

No, historically, XPs sell about 1/4 of the original title's sales, not the previous XP's release. It seems that most people who buy one expansion for a title they really like buy them all (see The Sims). Civ3 is a cash cow for Atari. They will try to milk it till it is totally dry (this is at least 2 XPs down the road).

Besides that, XPs can be 'farmed out' to third party developers to save costs and lower risk.

I figure Civ4 is probably at least 4 years down the road. They have to finish the projects they are on now before starting it (typically 18 months to 2 years) plus the inevitable XP for those titles plus the time to get Civ4 out the door (another 18 months to 2 years).

statusperfect · May 20, 2003, 06:17

Quote:

Originally posted by WarpStorm
Civ3 is a cash cow for Atari. They will try to milk it till it is totally dry (this is at least 2 XPs down the road).

So there is more to be expected?

cheers

Immortal Wombat · May 20, 2003, 08:24

http://www.gamerevolution.com/games/infogrames.mp3

statusperfect · May 20, 2003, 09:14

Quote:

Originally posted by Immortal Wombat
http://www.gamerevolution.com/games/infogrames.mp3

ROFL!

cheers

Oerdin · May 20, 2003, 19:20

I'm not sure if we'll see much more beyond the next XP and a "Gold Edition" which sells the original game, both XPs, and all the patches.

WarpStorm · May 20, 2003, 21:02

As long as they continue turn a profit (and Civ3 and PTW did big time), I think you'll see more. The latest press release from Atari hints at multiple future Civ titles. I don't think they are willing to wait (and spend the big money) for Civ4, when they can crank out a couple of XPs in the next few years until the time is right for an overhaul.

Chemical Ollie · May 21, 2003, 16:05

They deserve financial problems. PtW was released in the Nordic countries SIX MONTHS after USA.

statusperfect · May 21, 2003, 18:13

i even forgot to buy it on release since it was delayed about ten times

and the last delay was because of burglary in a infogrames warehouse in stockholm (they got away with loads of PtW copies, wonder who did that

)

cheers

Mad Bomber · May 21, 2003, 18:25

Quote:

Originally posted by Olaf Hårfagre
They deserve financial problems. PtW was released in the Nordic countries SIX MONTHS after USA.

Not to mention having a patch out 48 hrs after hitting the stores in the US

statusperfect · May 21, 2003, 18:29

Quote:

Originally posted by Mad Bomber

Not to mention having a patch out 48 hrs after hitting the stores in the US

isn't that supposed to be a good thing?

cheers

Capt Dizle · May 22, 2003, 01:46

No, it means they went gold with a product they knew wasn't ready to ship.

Oerdin · May 22, 2003, 14:23

They knew way prior to ship that the product was rubbish and rather then waiting a month or two to fix it so it might be semifunctional upon release they just shoved it out the door. Luckily, I bought my copy from the bargin bin month's after release.

I got burned by the intial Civ3 release and I swore never again.

Panag · May 22, 2003, 17:27

hi ,

old news , if you see the way they run things in paris , ......

last year they took a hard dip when it turned out patches where needed for civ3 and a bunch of other games , ....

and what ya want , they need for every single version a whole bunch of programers , for each stupid language they bring out , .....

not to mention about the r&d , .....

have a nice day

WarpStorm · May 22, 2003, 17:59

Over half of the games I've purchased in the last few years had a patch on release day.

There are many reasons for this. The biggest is that the code is sent out for duplication about a month or so before the ship date. Why should the developers not use this time to fix issues?

Panag · May 22, 2003, 18:23

Quote:

Originally posted by WarpStorm
Over half of the games I've purchased in the last few years had a patch on release day.

There are many reasons for this. The biggest is that the code is sent out for duplication about a month or so before the ship date. Why should the developers not use this time to fix issues?

hi ,

lets hope this is true with civ conquer

have a nice day

Catt · May 23, 2003, 17:59

From today's online WSJ:

Quote:

'Enter the Matrix' Game
Tops One Million Mark

By KEVIN J. DELANEY
Staff Reporter of THE WALL STREET JOURNAL

PARIS -- Infogrames Entertainment SA said Friday it had sold more than one million copies of its big-budget "Enter the Matrix" videogame one week after its launch in the U.S. and Europe, underscoring the game industry's attempt to gin up hits through tie-ins with Hollywood movies.

The game, which shares characters and plot elements with the "The Matrix Reloaded" film released last week, is Infogrames's big-money gamble on a blockbuster title. The company is betting that a megahit will help preserve its position among the ranks of top videogame publishers, at a time when it is struggling financially and profitability increasingly depends on having size and scale.

Infogrames, Lyon, France, adopted the Atari brand for all of its activities this month. It is the fourth-largest independent publisher in the world, but has piled on debt and had choppy sales in recent years, forcing it to write down assets and undertake a large restructuring.

Inforgrames's U.S. unit, which trades publicly as Atari Inc., saw its shares rise 74 cents, or 17%, to $4.97 in afternoon trading Friday on the Nasdaq Stock Market.

The Matrix game had a production budget of $20 million, making it one of the most expensive titles ever. When other expenses are factored in, including the acquisition of a small game studio that owned the Matrix videogame license, the total cost of the game could hit $80 million.

Some analysts said first-week sales of more than a million units -- the industry's benchmark for a blockbuster -- were praiseworthy. But they cautioned that the early sales numbers were no guarantee that the game will remain a goldmine. "Enter the Matrix" has received mixed reviews from online videogame reviewers that some analysts say are less enthusiastic than those generally needed to ensure blockbuster sales.

Infogrames said early this month that it was shipping more than four million copies of the game for the launch, based on retailer pre-orders. Actual sales of that level or above would make it one of the top-selling single videogame titles of all time.

Game Stores Group Ltd., one of Europe's largest videogame retailers, said in a statement that it was "very pleased" with initial sales of the Matrix game, but declined to give specific sales numbers.

Infogrames could use a mega-hit. The company is trying to cut a net debt load currently hovering around 435 million euros that has spooked investors in recent years.

Infogrames is trying to renegotiate the buyback of some of the 347 million euros in convertible bonds it has outstanding, according to people familiar with the matter. Infogrames lowered its convertible bond debt by 87 million euros in January.

Company spokespeople weren't immediately available for comment.

Catt