GamePro Rumour Mongering

But Epic certainly doesn't *need* the money...

I think Travis Moses is a betting man, and I hope he looses.

Sir_Brizz said:

We'll try to get some official comment on this article later on today.

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Why bore us with facts when we can enjoy a "Now we know why the UT3 Linux client is MIA" conspiracy? Spoilsport!

Rather more seriously, I'm sure the possibility of MS buying Epic is something that has at least been considered (not necessarily jointly) by the respective management teams.

Whilst I think a deal would in the end destroy the cross-platform engine side of the business, I can see that there are still some attractions for MS in buying Epic for exactly that reason. However, I suspect that it is too late in the current console generation to achieve an immediate benefit - too many studios/publishers will have site or multi-game licenses and so would not be impacted directly by a reduction of support or withdrawal of further licenses for non-MS platforms. And whilst the UE middleware is good, it is not as though there are no competitors willing to take up the slack caused by Epic diluting or withdrawing support for non-MS platforms.

Any Epic response has to respect the maxim, "Never say never". They would be foolish not to leave the door open (just a little).

afaik, microsoft also wanted to buy id software several years ago, so i could very well imagine ms wanting to buy epic. but i kind of doubt that will happen.

the idea of 'Microsoft Unreal Tournament' scares me, though

nELsOn said:

the idea of 'Microsoft Unreal Tournament' scares me, though

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They must be really desperate to draw readers. I give them 6 months before they dry up and die.

the only possible good things that could come from MS buying Epic, is that it would probably ensure that future games would also be made for the PC...

The thought of future UT games requiring windows live makes me throw up in my mouth a little.

dethmanrulz said:

the only possible good things that could come from MS buying Epic, is that it would probably ensure that future games would also be made for the PC Xbox360...

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fixed that for you

There won't be any concrete comments other than "no comment".

It's the goal of most business owners to eventually sell it off, and retire. The guys at Epic who actually own it, and would get the big pay-off are surely not at all opposed to the idea. They get paid millions, and retire to play around and have fun for the rest of their lives at like age 35.

I'd be selling it in a heartbeat.

I *highly* doubt Epic will be bought out by Microsoft.

Not after complaining about it's Live architecture.
Not after the "1 Billion Dollars" Xbox 360 ram issue with Gears of War.
Not when Epic Games' biggest source of income comes from licensing, not games.

It'd just be nutty.

I think the only reason why people even ENTERTAIN this rumour is because it's GDC.

I had mentioned this a few weeks ago. Epic seems like its positioning itself to be bought out and taken over. Companies that someone started up, runs, and treats like his/her baby don't normally get bought out. Companies with management changes (Capps), image changes (new company logo), new directions (expanding IP development), and an expanding lack of interest in relating to their customers in a positive way normally do get bought out. A turbulent future is ahead and it's pretty clear to me that Epic is making all them moves to make themselves attractive for purchase.

I worked for a company where they did this kind of positioning for years. They denied it constantly despite taking the emphasis off of customers, treating customers and employees like numbers, reducing commissions, updating their logo, and having management changes. Unsurprisingly one day they announced the buy-out and the executives who were only there for a few years slipped away with tens if not hundreds of millions of dollars. There are entrepreneurs (those who build an empire) and wolves (those who take control and leverage the assets for their own personal fortune). The company I worked for was built up by an entrepreneur (who died), taken over by a wolf, liquidated to an acquisition firm, and working there got so bad I left. The new wolf CEO and then acquisition firm had no idea how to run that company and why people liked buying things from it and working there prior to the buy-out.

Microsoft has got money burning a hole in their pockets right now. Epic and Microsoft have been getting closer and closer together over the past couple years so this should come as no surprise to anyone.

Forgive me for my ignorance, but in a buyout both companies have to agree to the terms or it's a 'no-go' right? I mean, company A can't buy company B if company B refuses?

drakon said:

Forgive me for my ignorance, but in a buyout both companies have to agree to the terms or it's a 'no-go' right? I mean, company A can't buy company B if company B refuses?

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Follow the news with Microsoft wanting to buy Yahoo. Yes, both companies need to agree, but there are alternative ways to force a company into agreeing when it doesn't want to. There are upfront ways of increasing the bid and lobbying, and there are backhanded ways like usurping the current board or playing shareholders.

drakon said:

Forgive me for my ignorance, but in a buyout both companies have to agree to the terms or it's a 'no-go' right? I mean, company A can't buy company B if company B refuses?

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A company is not a singular entity.

There will be management and shareholders. Sometimes those are the same and sometimes not.

In the end, for a profitable and debt-free(-ish) company and where there are no monopoly or regulatory issues, it is normally the shareholders who decide. In some jurisdictions, there are other stakeholders and rules that tilt the balance between the management, shareholders and other stakeholders.

It is not uncommon for management to reject a "hostile" bid but for the shareholders to accept that bid anyway and sell the company.

In a company like Epic, a lot of the value in the company lies in the knowledge held by the employees (some of whom might also be shareholders). A genuinely unwanted bid might gain control of the company only to see those valuable employees move on. Stock in a company where the best and the brightest have left is not such a hot deal. For that reason, I would expect any potential suitor to want the bid to be "friendly".

is it a suprise? cliffy just got ****ed up the ass from his console based statement the other day

drakon said:

Forgive me for my ignorance, but in a buyout both companies have to agree to the terms or it's a 'no-go' right? I mean, company A can't buy company B if company B refuses?

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you can for public companies, it's called a hostile takeover.
but Epic is privately owned, the owners will have to agree.

IronMonkey said:

In a company like Epic, a lot of the value in the company lies in the knowledge held by the employees (some of whom might also be shareholders). A genuinely unwanted bid might gain control of the company only to see those valuable employees move on. Stock in a company where the best and the brightest have left is not such a hot deal. For that reason, I would expect any potential suitor to want the bid to be "friendly".

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Unless the company making the takeover bids is after the brand name or franchise instead of the people who are behind it. Microsoft wants control over the Yahoo brand. EA wanted control over the Command and Conquer franchise. Lenovo wanted control over the Thinkpad brand. Microsoft wanted control over the Halo franchise. There are multiple reasons for a takeover and not all of them involve keeping the people who created it. It's entirely plausible that Microsoft is treating Gears as a franchise and the Unreal Engine as a brand, and those things are what they have their sights on.

With a new Xbox being in development and possibly coming in 2 years (Xbox 512 or Xbox 7 as I've seen it referred to as) it's entirely likely Microsoft needs a new acquisition to offset turning Bungie loose, and a new or young franchise to power sales of that new console. Again though, Microsoft has demonstrated it has money burning a hole through its pockets and easily gets going into blind rage against competitors.

BigDragon said:

Unless the company making the takeover bids is after the brand name or franchise instead of the people who are behind it. Microsoft wants control over the Yahoo brand. EA wanted control over the Command and Conquer franchise. Lenovo wanted control over the Thinkpad brand. Microsoft wanted control over the Halo franchise. There are multiple reasons for a takeover and not all of them involve keeping the people who created it. It's entirely plausible that Microsoft is treating Gears as a franchise and the Unreal Engine as a brand, and those things are what they have their sights on.

With a new Xbox being in development and possibly coming in 2 years (Xbox 512 or Xbox 7 as I've seen it referred to as) it's entirely likely Microsoft needs a new acquisition to offset turning Bungie loose, and a new or young franchise to power sales of that new console. Again though, Microsoft has demonstrated it has money burning a hole through its pockets and easily gets going into blind rage against competitors.

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The argument for using Gears as a new launch title is the most compelling one I've seen, although they wouldn't need to buy Epic out for that to happen.