Wow, have you ever looked up the net worth of the big 3?

Microsoft 1.77 trillion

Sony 123 billion

Nintendo 95 billion

So Microsoft is worth 8 times more than Sony and Nintendo combined. Kinda makes that 7.5 billion Bethesda acquisition look like a drop in the bucket for them. Kind of makes you wonder why they don’t just buy all the game companies.

That's why I've been preaching on here for the last ten years; stop poking the bear but did anyone listen? lol :P

Yes, that's why the idea that MS needs to sell Bethesda games on PS5 to make money is so stupid.

Well MS and Sony do more than just games.

I think that if this Bethesda acquisition proves to be successful for Microsoft, we will be seeing them buying out a lot more big name companies.

That’s cute. Now breakdown the Microsoft and Sony numbers per division.

Windows revenue = Xbox wins?

I don't have a special bank account for food, another bank account for video games, another bank account for clothes, another bank account for cars etc. I just buy all this stuff from the same bank account, and they do too.

Well to be fair you have to take into consideration what other businesses that each company is in as well.

The total net worth plays a big role in power and survivability too. For example, if Nintendo lost 95 billion, they'd go out of business. If Microsoft lost 95 billion, they'd be just fine. More money allows you to gain more control and take bigger risks.

Amazon had a business model where they sold items for little to no profit in hopes of gaining loyal customers and taking business away from others. It's entirely possible that Microsoft could be comfortable losing money just to try to win, because they have money to lose.

@arkephonic: Well naturally yeah you can theoretically assume that but it’s not really a guarantee of anything. How much is Google and Amazon worth? They really haven’t done all that much in gaming despite making attempts to get into it. Also oddly enough Nintendo seem to be the one’s who typically take more risks.

That's not true at all, though. Corporations like MS have compartmentalized divisions, and the vaaaaaast majority of the worth isn't "free" currency but value tied up in something.

Following your example, if the gaming division lost 95 billion, MS would 1) have to be very cautious and 2) be very limited in their ability to lift money from another division and throw it back at the gaming one. You really do need to understand the value and profitability of the divisions to compare the big 3. The same applies to the others - Sony can't just "take" money from their insurance business to bail out a failing Playstation (if that were to happen).

It's not like there's a bank account MS or Sony has with a big pot of that money, for any or all divisions to use as needed.

It's also about making smart business decisions. How much of a money pit would Google and Amazon have to fall into to try and take over the gaming industry? I just don't see that happening. Microsoft at least has been competent since 2001 in the gaming industry. Google and Amazon can't just jump in and take over, especially since they have to deal with Microsoft. Nintendo had to make very smart business decisions to get where they are today, and they faced a very real possibility of getting eliminated quite a few times. Nintendo doesn't have nearly the ability to take a risk and fail like Microsoft does. If Nintendo takes a risk and fails, they could be done for.

I think it's safe to say that Microsoft has A LOT more money to burn on gaming than Nintendo and Sony combined. And like you said, losing that much money would make Microsoft "cautious". Whereas it would make Sony and Nintendo bankrupt.

@arkephonic: Well no one said that Google and Amazon needed to take over the gaming industry. However with all that money that they have at their disposal their attempts at even just getting their foot in the door have been quite the failure. Money is by no means a guarantee to success. You’ve actually proved that point in your post.

The way I see it, there's no point for any other company to even try to enter the gaming industry now because of things like cancel culture and social media. People have made up their minds on what they like, and will bash and bully anyone that comes in to try and compete, just like we saw with Stadia. Look how Stadia gets treated on social media, it gets bashed to no end. It did ever since the very beginning.

The difference is that Microsoft has already established a foothold in the gaming industry so they won't be cancelled or completely dismissed like a Google or Amazon.

It appears that Bill Gates himself is worth more than Sony and Nintendo.

that is interesting.

is this news to someone?

I would love to be in last place here

@enzyme36: Forget that, I'd be happy at the bottom 100 lol.

Anyway, I do wonder if the division's profitability is more important than the parent company.

PlayStation, Xbox, Nintendo

rather than

Sony, MS, Nintendo

but as some people already pointed out, big daddy MS bought Zenimax, in part, for Xbox.

Smol daddy Sony might have a harder time spending that much, at least nowhere as easily as MS.

I'm not supprised seeing as nearly every business and personal PC uses windows, but I wouldn't use the entire company's worth as a factor seeing as how it's gaming division hasn't been so successful. The OG Xbox actually lost Microsoft $4 Billion dollars and the 360 didn't turn a profit until 2008, three years after it released. It was so low that it was in the air on if they wanted to get out of the industry and cut their losses like they did with the mobile phone and music market.

Microsoft is profitable now, but I see a difference between them and Sony and Nintendo where they NEED the gaming market while Microsoft doesn't. They would just cut out the entire division if it didn't turn profit.

Maybe they think if they keep buying talent and big name developers, it will in a sense allow them to monopolize the market. They're no stranger to monopolies. Also keep in mind that they are profiting from PC gaming too.

If I were Microsoft, I would make 1 more really big move to get people's attention. I would buy Rockstar or Activision/Blizzard or something right now.

MS is by far the biggest company overall. If you compare just the gaming divisions though MS is dead last. The scary thing is it doesn't matter. MS has over 136 bill in cash and could easily buy half the game Industry.

@arkephonic: no, you're missing the point. If the gaming division in MS was worth 85 billion and they lost 85 billion they (the gaming division) would go bankrupt, just like Nintendo. MS "the bigger" would almost surely pull the plug or restructure the gaming division in some way before it really hit that stage, of course. That's one benefit to there being a bigger company behind the scenes.

And that's assuming the gaming division is worth 95 billion - which we haven't seen in your post above.

This has been discussed ad nauseum around here, though - there are two camps: those who only care about the overall super company's worth and those who dig in on the "what's the game division doing" point. Welcome to the battle

But when it comes to an acquisition of a company like Zenimax, or future acquisitions of companies as big or larger than Zenimax, there's no formality that says "this acquisition must come from the funds of the gaming division". Microsoft as a company can make these acquisitions from their pot of gold, enhancing their gaming division with funds outside of their gaming division. With 1.77 trillion dollars of net worth, they can just pull strings that Sony and Nintendo can't and that's simply a fact you cannot deny.

@arkephonic: i'm not trying to "deny" the fact - you're not wrong that MS is a far bigger company. I'm just pointing out that almost none of that money is freely available for "the system war"

My point is that when making acquisitions of a company like Zenimax, there's no formality that says they're only allowed to buy other companies using money strictly from their "gaming division".

And that's really the shock of this whole thing. The acquisition of Zenimax kinda shook the entire gaming industry. The reality that the 7.5 billion acquisition wasn't even a drop in the bucket and Microsoft could just go and buy Activision/Blizzard, Rockstar, Ubisoft, basically whoever they want, that's the real eye opener for me and everyone else. They could buy all these companies and it wouldn't even affect their net worth, and their stocks just continue to rise and rise every year.

Completely irrelevant and misleading numbers. What was posted is the trading value of the companies. The numbers reflect a portion of the bank accounts or worth of the investors who own the stock which has zero to do with the bank accounts of the companies.

The ability to acquire is related to the actual cash available to buy, unless you want to buy through debt/borrowing. For that, it is Balance Sheet, Assets, Current Assets, Cash & Cash Equivalents. This is what is real money in the bank or the equivalent investments that can be sold immediately and turned into Cash.

Also, even these numbers are inflated to the reality of what you could spend. Cash on hand is needed to pay your employees, pay your bills, etc. so you can't spend your whole piggy bank on acquisitions.

MS $132 billion

Sony $42 billion

Nintendo $11 billion

All numbers as of Dec 31 2020. Japanese Yen converted to $US at today's exchange. Rounded to closest billion.

Suddenly a purchase of $7.5 billion is more significant, even to MS. It would be considerably more significant to Sony, but they clearly could do so. It is essentially impossible for Nintendo because if it goes bad the company likely wouldn't survive.

Google search "microsoft stock last 5 years". It just keeps going up and up and up and up and up. I know because I own thousands of shares and have made an ungodly amount of money from it.

Interesting, good info. Nintendo really does have their backs against the wall. They can't even make 1 mistake.

Then it's a good thing you're not Microsoft because you would effectively destroy competition and foster an anti-consumer environment by effectively encouraging the creation of an oligopoly because your competitors would be forced to buy competition as well.

Which Microsoft kinda already did with the purchase of Zenimax. Buying Rockstar (Take-Two) or a titan like Activision-Blizzard would be a great day for Microsoft but a sad day for us. You don't want to give more control to the big 3 than they already have, they'll become incredibly complacent (see when Nintendo and then Sony single-handedly dominated the industry) and you'll have nowhere else to go.

Well yeah but if you had $5,000 in the bank and your spouse spent nearly all of it on food you'd be pretty pissed right? I'm sure each division has their limits and budgets.

I'd argue that it would make the products better. Nintendo and Sony consoles sell really well. They would need to further improve their products to continue to sell so well.

Let me ask you this.

If you and your 2-3 other competitors effectively control the market and are each comfortable in your positions without any other industry player that can threaten your market share and your consumers are basically dependant on you to produce the product they want (they can't get it elsewhere)... then at that point what incentive do you have to create compelling products and to innovate in your field?

That isn't a clear picture whatsoever at all. Break down just the gaming divisions. All three own assets outside of the gaming space.

This is the most dumb assertion (tu put it politely) i've read in SW in quite a while ... i'm speechless at the fact that someone could even think like this. I sincerely hope you are either trolling, or just a very naive kid.

Think of it this way. Microsoft, Nintendo and Sony gaming divisions could just be compared to regular adults. The difference is, Nintendo and Sony have poor parents and Microsoft has rich parents. With rich parents, they're always there to bail you out or buy you fancy toys. Rich parents can buy your car, your college education, help you out with your first house, Microsoft has that. Microsoft's gaming division's "parents" bought them Zenimax, and will likely buy them more companies moving forward. Sony and Nintendo don't have rich parents, they don't have that luxury. If Microsoft loses money in the gaming division, it doesn't matter because they have rich parents. If Sony and Nintendo lose money in the gaming division, they don't have rich parents to fall back on so they're done for.

You think that losing 95 billion for Nintendo would have the same impact as it would for Microsoft?

And ultimately, the Xbox and PC gamers are the real winners because of this because their experience doesn't change regardless of X or Y amount of Xbox consoles or PC's sold. They benefit because Microsoft is just throwing money out there like a boss to make their experience better. Who benefits from a deal like the Zenimax deal? It's the Xbox and PC gamers, when in reality, the gamers like me just spent chump change on a little console or a PC which is cheap and they reap the benefits of these multi billion dollar deals.

@arkephonic: Real winners are PC gamers. Not sure how Xbox gamers are winners. PC is the least excluded platform when it comes to gaming.

Xbox is a poor man's version of a PC with worse graphics, less features and much less versatility and capability because a PC can do everything outside of gaming as well. But, Xbox gets to take advantage of some of these things, PlayStation and Switch don't.

@arkephonic: The Xbox is a console like PlayStation and Switch. Nothing more nothing less.

It's almost as if this entire discussion flew over your head. Not only this discussion, but all gaming current events for the last few months.

@arkephonic: Nothing flew over my head. You are just making something out of nothing. I am simply correcting you. 😎