Just in the interest of preparing everyone emotionally, I actually suspect a stock price bump before too long. To be honest, I actually expected a bump after the announced layoffs in Seattle; typically investor knee-jerk reaction is that layoffs mean that a company is "trimming the fat," so to speak, and streamlining operations. (Which is the official message NCsoft is putting out, by the way.) The fact that it didn't bounce on the news is moderately interesting, in that to me it indicates that investors aren't buying it--metaphorically or literally. But whatever...
Anyway, not that I'm going to go out and buy NCsoft stock, but a lot of investors (myself included) look specifically for stocks that have fallen or recently taken a beating to invest in. Not that I'm looking to lose my butt on buying up junk stocks, but a lot of times investors buy and sell based solely on emotional reaction to some situation, such as a bad financial report or some bad PR move, but the company itself is a decently stable company. In that kind of situation, a low stock price means essentially that the stock is "on sale," that it will likely go back up, and you can make money thanks to other investors' overreaction to something.
To be honest, I wouldn't touch NCsoft with a 10-foot pole, but then I'm not exactly an unbiased investor when it comes to the company right now. Plus, I feel that I might have a better finger on the pulse of what it's going through than some investment adviser who doesn't know one thing about the game development industry or gamers themselves; that you really have to have a pretty good idea of what kind of games are market killers versus just DOA. So right now, because NCsoft's stock is so low, a lot of investment sites actually are recommending that people buy it. As a result, people probably will actually buy it, thus raising the price.
But long-term, I think that these investment advisers are assuming that NCsoft will be able to continue along like they have in the past, when in fact, things have changed. Before, NCsoft was a growing company with a stable of profitable titles, new games in development, and a bright future. Now, thanks to the actions of their executive management, they've killed off a game that had stable income, one that at least had potential (Tabula Rasa), and two of the games they were counting on being monsters did pretty well, but thanks to a pretty dramatic shift in business models, don't have a lot of potential for long-term stable income. Oh, and they have one studio (Carbine) working on a game (Wildstar) that is probably
at least another year or two out, if it ever gets released at all. In short, their medium-term prospects don't look good.
In my opinion, it looks to me like NCsoft is basically conceding the Western market. Just as Bugs Bunny cartoons are quite different from Japanese anime, Western-style MMOs are generally quite different from Korean-style MMOs. Years ago, NCsoft was on the right track; they created a western subsidiary to handle the North American and European gaming markets. Unfortunately, the past few years, they've done nothing but hamstrung that subsidiary, forcing it to make critical errors based on their own flawed perceptions and goals. We're never going to be Korea, and if NCsoft had realized that two or three years ago, they might not be in the predicament they're in today. Maybe instead of
buying a baseball team, they would have invested in marketing and support for their North American and European operations doing stuff like, you know, making games. There is, in my humble opinion,
an extremely insightful and probably really accurate analysis of what I think NCsoft's motivations are over on Slashdot. Probably a bit of a simplification, but still probably more-or-less accurate.
Anyway, I don't know that NCsoft will
really completely go under. A lot of it is going to depend on how well Blade and Soul and Guild Wars 2 does in Asian markets. If they do well in somehow managing to find a way to scrape out a consistent source of income, they'll probably linger on. But if they fail like Aion did, or if people just buy the box and don't continue investing in microtransactions at the level that I'm pretty sure we were with City of Heroes: Freedom, it's entirely possible that the company will either tank completely and go out of business, or more likely, get bought by someone else, stripped of its assets (quite possibly including IP), and sold off for scraps. About the only thing I'm almost certain of is that they're pretty much dead in the water here, and if I worked for Arena.Net or especially Carbine, I'd be looking hard to jump ship before they close down those studios.
I guess time will tell and we'll see. I do think it's telling that it looks like even the knee-jerk investors have lost confidence in the company. It wouldn't surprise me if the stock price bumped up at least some as other investors try to get in as the elevator comes back to the ground floor, but for the long-term, I certainly wouldn't bet on the company and I still believe that there is at least a decent chance that someone will be able to get the IP for City of Heroes on the cheap who can revive the game. Unfortunately, it also means that there will be opportunity for third parties to acquire the IP specifically for the purpose of
not reviving it, to effectively prevent it from competing with their own products. It really just boils down to exactly who it is and if they want they want to do.