NCSoft Stockwatch

[Lily Barclay]

THAT - right there - that needs to go viral.

Tweeted it, linked the article.

[houtex]

Wow... that's... well, heck, that's astounding.  I don't think NCSoft will die, truly, but.. this can't be good for them.

But now I have a new question.  What happens if, somehow, NCSoft goes kaput?  What happens to the IPs?  Do they all just... disappear?  Or would anything and everything be up for auction?  What's the situation that would likely happen?  I am a little worried that a dead NCSoft = IP buried forever...

Surely I'm just paranoid...

/Did this be covered?  Me+search=not winning, and besides, I'm le tired...
//oh well, have a nap, THEN FIRE ZE MISSILES!
///No, I don't mean "is houtex paranoid", that's well known and covered by now, yeah?

[TonyV]

But now I have a new question.  What happens if, somehow, NCSoft goes kaput?  What happens to the IPs?

Worst case scenario (for NCsoft, not for us) is that they liquidate all of the assets of the corporation, including the IP rights to City of Heroes.  At that point, they'll likely be up for grabs to whomever offers the most money for them.

[Grot 6]

What were the offers on the table that NC Soft turned down?

Food for thought, but if the compnay tanks, they may have to reestablish the game for survivals sake. If not, if they sell, do we have a strategy here to put a foot in the door, or aquire funding to buy it.

How far are we willing to go here? Is there a serious enough presnece here to step up, if the opportunity presents itself?

I don't really do anything setrious without a plan, what is the plan here in the event that the IP becomes available?

What do we need to do here to get a strategic plan for aquisition of the IP if and when it becomes available?

Is there contact with the old team, and if given the opportunity would they return to this IP?



Tick Tock, Tick Tock, folks...

[V-Mink]

What were the offers on the table that NC Soft turned down?

Food for thought, but if the compnay tanks, they may have to reestablish the game for survivals sake. If not, if they sell, do we have a strategy here to put a foot in the door, or aquire funding to buy it.

How far are we willing to go here? Is there a serious enough presnece here to step up, if the opportunity presents itself?

I don't really do anything setrious without a plan, what is the plan here in the event that the IP becomes available?

What do we need to do here to get a strategic plan for aquisition of the IP if and when it becomes available?

Is there contact with the old team, and if given the opportunity would they return to this IP?



Tick Tock, Tick Tock, folks...

I think it's safe to say that NCsoft is not going to restart City of Heroes.  If the City comes back, it will not have an NCsoft logo on it.  However, if NCsoft declares bankruptcy, they may have to sell their various IPs.  At that point, if it isn't part of some sort of 'package deal' then the various corporate assets will be sold off.  I'm not sure exactly how that will work in Korea.

My redside disgruntlement is that the people who made these boneheaded decisions will leap from the crashing plane with golden parachutes.  My blueside disgruntlement is that the employees are going to get royally shafted.

Sudden odd thought: What if this is being set up for, or is going to be used as, a takeover of NCsoft by Nexon?

ETA: It is vanishingly unlikely that the CoX community will be able to purchase the IP.  The amount needed will be in the millions of dollars; even in a bankruptcy sale, there's a lot of money involved.  This is why TF Hail Mary has been trying to sell the idea of purchasing the IP to other corps, rather than trying to get us to raise the money ourselves.

[Blue Pulsar]

I never thought that.  The KT article that quoted VV might have been the first time it was brought to the attention of Korean investors and gamers and that was only a few weeks ago.

Anyways I was looking for why there are sudden sharp drops over the past two days.  That wouldn't be for us.

I am not saying what you are insinuating isn't possible. I'm not even saying it's not probable. I actually think that it is more likely. But I think that it is also likely that their stocks are going down because of bad press. Smart investors investigate companies. They watch what they are doing and they look for information on them. When they decided to close down CoX, it did send a bit of a backlash through the internet medias. It would have been very easy for even the most novice of internet sleuth to pick up the information. Couple that with the stocks already starting to decline and I would not have any doubt if it were told to me that this community here has had a rather large role in the stocks being as low as they are.

In the words of Billy Joel: We didn't start the fire

But unlike him, we aren't trying to fight it, we are trying to fuel it. I'm laying down my burn patch wherever I can.

Edit: spelling

[JaguarX]

What were the offers on the table that NC Soft turned down?

Food for thought, but if the compnay tanks, they may have to reestablish the game for survivals sake. If not, if they sell, do we have a strategy here to put a foot in the door, or aquire funding to buy it.

How far are we willing to go here? Is there a serious enough presnece here to step up, if the opportunity presents itself?

I don't really do anything setrious without a plan, what is the plan here in the event that the IP becomes available?

What do we need to do here to get a strategic plan for aquisition of the IP if and when it becomes available?

Is there contact with the old team, and if given the opportunity would they return to this IP?



Tick Tock, Tick Tock, folks...

If it comes down to having to purchase the IP ourselves, I'm willing to put in, as I stated a couple times earlier when I first got here. But yea, it will be millions that will be needed even at bottom line wholesale price. I havea couple of more people I know that would be willing to throw money in too, and one that I will have to sell the idea to.

But with the many as they stated well off people we have here, we can do it I believe if we wanted to.

Also with getting the money together it's not as simple as gathering money from various people here as when buying property like that in that manner a lot of legal stuff come into play, not saying legal stuff is bad and or cant be overcome, just saying there will be some beyond the collect money and go buy it.

Even if worse case in bankruptcy, which something really really bad need to happen as it is said that NCSoft have a very low debt compared to the amount of cash they have laying around. Bankruptcy is usually to liquidate assets to pay off creditors. If things really hit the fan, more than likely they will pay off the little debt they have with the cash and just go defunct or just small enough where they are still a company that just hold on the IPs. I think before they hit banruptcy, Nexon probably will buy the stuff in an inside deal first  or just upsurp it and still we will be in the same boat now except not with NCSoft but with Nexon.

For the stocks to be going down, one thing that is unusual is it seems that NCSoft is not worried so much, not to mention so soon after the CEO sold off his stock, and relatively soon after Nexon joined the fray.  I cant pin point it, but seems like something is going on between Nexon and NCSoft that would be rather frowned upon Stateside but still commonly happens in the corporate world even in the US. As much as many people wish it, I doubt NCSoft is going anywhere anytime soon. Although they make bonehead moves, I do not believe they are complete idiots or green when it comes to corporate buisness. Seen many "Lower the stock prices, "outside" company buys a bunch of them for the low price, stock prices in a "miracle" fashion, rises" scenarios.

Something fishy seems to be going, I can smell it but I dont see the fish yet.

[mikenovember]

Something fishy seems to be going, I can smell it but I dont see the fish yet.

I asked a few friends in the Korean business community what they thought of all this - not that I don't think your knowledge isn't really impressive, (our many props to you my friend   ) and they laughed a bit.  Not one or two people - but all of them, which kind of surprised me like there's some kind of 'inside joke' about the Korean Corporate business model or something when it comes to game companies.   

They did indicate that this last comment - from Morgan was very damaging.  More for the indication that they would not be successful in China than anything else.  Apparently that's the golden calf everyone is betting on over there to help their businesses.

[FatherXmas]

Well NCsoft has been hyping China as the new untapped market for them.  Only Lineage I and II currently have an official presence there but it's very small.  Blade & Soul is trying to tap the Kung Fu movie genre tropes with their action gameplay and martial art super powers.  Beef and Cheese cake doesn't hurt since most MMO players tend to make idealized versions of themselves.  What guy doesn't want to be 8 ft tall with rippling abs?  What woman doesn't want the body idealized in the media and ads?  That's the mentality here.  NCsoft is betting the bank on B&S or GW2 becoming a greater success in China than either of their old, old Lineage games.

[chasearcanum]

I asked a few friends in the Korean business community what they thought of all this - not that I don't think your knowledge isn't really impressive, (our many props to you my friend   ) and they laughed a bit.  Not one or two people - but all of them, which kind of surprised me like there's some kind of 'inside joke' about the Korean Corporate business model or something when it comes to game companies.   

They did indicate that this last comment - from Morgan was very damaging.  More for the indication that they would not be successful in China than anything else.  Apparently that's the golden calf everyone is betting on over there to help their businesses.

Correct.  The Chinese market is an oft-misunderstood, but frequently used as the solution when growth stagnates, and this is particularly true for some Korean businesses.   Its the key part of the Asian market's business variant of the "emperor's new clothes" tale.

People use rosy projections based on the "China" promised land to boost up their stock valuation, and they usually find plenty of self-deluded investors determined enough to be "early" on some big deal that they ignore all the warning signs.

Even when the warnings signs are quite clear- when they see that the emperor really is quite naked- they're wary to act.  Maybe they're missing something, maybe there's too much to lose by pointing it out, maybe its safer to play along and propagate the myth.  They may murmur to themselves, but never loud enough to raise alarm.

... for a while, at least.

Sooner or later, though, someone says the obvious, though.  Whether Morgan Stanley's statement is treated as a murmur or as a wake up call remains to be seen, though.

[chasearcanum]

What guy doesn't want to be 8 ft tall with rippling abs? 

8 feet tall?  I'll opt out.  I already almost lose my head to ceiling fans ithe coal miners that built the homes in my area seem to have liked low ceilings) 

Given the reaction of many of the women I know, B&S seems particularly bad for women- not really an "idealized" in their view, at all.  True, some women may like to be the center of attention like that, but I'm surprised it would be very many.

I do recall a few years back there was a study about the cultural differences among MMO gamers in different cultures, and it noted that Koreans were more self-projecting-- create a single avatar representing oneself to represent you throughout the game (less alting, less gender-switching, more opposition to others' gender-switching) than other markets.  For comparison, the Japanese did less self-projecting and more gender-switching- more often, they treated their avatars more like "dolls" to project personalities into, rather than extensions of themselves.  Some of this was attributed to the younger age in those demos (younger people are more likely to be seeking romantic attachment online and off, so representing oneself in your avatar correctly (at least in these critical ways) and expecting others to do the same is rather important.

This was an old study-- plenty of time for things to have changed, but it still strikes me as funny, as most of the B&S females seem to be made expressly FOR people wanting the "dolls" to play, pose, and.. umm... fantasize over, rather than project themselves into...

[FatherXmas]

8 feet tall?  I'll opt out.  I already almost lose my head to ceiling fans ithe coal miners that built the homes in my area seem to have liked low ceilings) 

Given the reaction of many of the women I know, B&S seems particularly bad for women- not really an "idealized" in their view, at all.  True, some women may like to be the center of attention like that, but I'm surprised it would be very many.

I do recall a few years back there was a study about the cultural differences among MMO gamers in different cultures, and it noted that Koreans were more self-projecting-- create a single avatar representing oneself to represent you throughout the game (less alting, less gender-switching, more opposition to others' gender-switching) than other markets.  For comparison, the Japanese did less self-projecting and more gender-switching- more often, they treated their avatars more like "dolls" to project personalities into, rather than extensions of themselves.  Some of this was attributed to the younger age in those demos (younger people are more likely to be seeking romantic attachment online and off, so representing oneself in your avatar correctly (at least in these critical ways) and expecting others to do the same is rather important.

This was an old study-- plenty of time for things to have changed, but it still strikes me as funny, as most of the B&S females seem to be made expressly FOR people wanting the "dolls" to play, pose, and.. umm... fantasize over, rather than project themselves into...

Well one report said B&S player demographic is 31% women.  A little bit lower than Aion but not by a lot.

[ukaserex]

I am not saying what you are insinuating isn't possible. I'm not even saying it's not probable. I actually think that it is more likely. But I think that it is also likely that their stocks are going down because of bad press. Smart investors investigate companies. They watch what they are doing and they look for information on them. When they decided to close down CoX, it did send a bit of a backlash through the internet medias. It would have been very easy for even the most novice of internet sleuth to pick up the information. Couple that with the stocks already starting to decline and I would not have any doubt if it were told to me that this community here has had a rather large role in the stocks being as low as they are.

In the words of Billy Joel: We didn't start the fire

But unlike him, we aren't trying to fight it, we are trying to fuel it. I'm laying down my burn patch wherever I can.

Edit: spelling

Here's the thing about stocks. Regardless of stock price, a company is always worth the amount of money someone is willing to pay for the company's assets.

For example: Let's take the CoH IP and well, all the other MMO game IPs that NCSoft has. Let us, for the sake of argument assume that a buyer is found for each and every asset to be sold. All those assets have a value. Divide the sum of those values, and that's what each stock is actually worth, despite stock price.
So, who really gets hurt when the stock price goes down? Noone, really. Unless they were wanting to sell. The largest stockholders take a hit on paper, but these reductions in net worth are rarely worried about. Over time, stock prices generally go up. What we're likely seeing now is the result of curfews for the youth, a weak economy and the occasional anti-ncsoft protest.

[JaguarX]

Here's the thing about stocks. Regardless of stock price, a company is always worth the amount of money someone is willing to pay for the company's assets.

For example: Let's take the CoH IP and well, all the other MMO game IPs that NCSoft has. Let us, for the sake of argument assume that a buyer is found for each and every asset to be sold. All those assets have a value. Divide the sum of those values, and that's what each stock is actually worth, despite stock price.
So, who really gets hurt when the stock price goes down? Noone, really. Unless they were wanting to sell. The largest stockholders take a hit on paper, but these reductions in net worth are rarely worried about. Over time, stock prices generally go up. What we're likely seeing now is the result of curfews for the youth, a weak economy and the occasional anti-ncsoft protest.

basically.

[FatherXmas]

basically.

In the last reported quarter, the book value of the NCSoft is roughly $880 million while their market cap at their current stock price is roughly $2.9 billion.  That's US dollars BTW.  A ratio (Price/Book) of around 3.3.

In comparison Apple has a book value of $112.9 billion and a market cap of $490 billion or a ratio of 4.3.  Microsoft's is 3.2, EA is 2.0, Activision/Blizzard is 1.1.  BTW numbers near 1 aren't good as it indicates that investors don't believe the company is worth much more than it's physical assets.  Less than 1 means the company is worth more to it's stockholders if it was closed and it's assets liquidated than what the stock is worth.

[Blue Pulsar]

In the last reported quarter, the book value of the NCSoft is roughly $880 million while their market cap at their current stock price is roughly $2.9 billion.  That's US dollars BTW.  A ratio (Price/Book) of around 3.3.

In comparison Apple has a book value of $112.9 billion and a market cap of $490 billion or a ratio of 4.3.  Microsoft's is 3.2, EA is 2.0, Activision/Blizzard is 1.1.  BTW numbers near 1 aren't good as it indicates that investors don't believe the company is worth much more than it's physical assets.  Less than 1 means the company is worth more to it's stockholders if it was closed and it's assets liquidated than what the stock is worth.

So, what you're saying is that Cap/Book means everything and stock price means nothing. Gotcha.

So, what does stock price mean and why do people follow and talk about it and not your ratio?

[Little Green Frog]

So, what you're saying is that Cap/Book means everything and stock price means nothing. Gotcha.

So, what does stock price mean and why do people follow and talk about it and not your ratio?

The purpose of stock is:

• to indicate perceived value of a company and
• to give companies transparent and accessible way to secure additional funding from investors.

As you may notice, I have emphasized that stock represents perceived value of a company. It does not reflect its real value and standing, although the price is based on them to varying extent. A company could, in theory, carry on just fine if its stock price dropped to 0, because what that means is that investors have literally no faith in it and also that the company in question is unable to acquire additional funds by selling its stock. Neither of those is terminal in of itself. In reality, though, a company with very low stock price (and low is relative) must have had earned it by being in a lot of trouble and that will kill it regardless of stock price.

Stock also regulates ownership of the company with person or institution that has the largest amount of stock being the owner.

edit: wording

[Blue Pulsar]

The purpose of stock is:

• to indicate perceived value of a company and
• to give companies transparent and accessible way to secure additional funding from investors.

Stock also regulates ownership of the company with person or institution that has the largest amount of stock being the owner.

edit: wording

I do understand and know this, but my question was more in reference to what the X-mas was saying. My point was that stocks do have a purpose and importance. (I'd guess even moreso than you and X-mas are insinuating.) I was hoping for him to explain his point of view as to where they fall in importance compared to his ratio and if they are as low of importance as he suggested, then why are they treated so important.

[FatherXmas]

It's perceived value in relation to the other companies in the exchange.  They are all chasing the same money of the investors.  Assuming investors are rational players, they are looking for companies that will give them the best return on their money.  This could be dividends (cuts of incoming sales) or stock price growth (by being more attractive than other companies due to fundamentals).

And Price/Book is just one of a number of measurements in an attempt to objectively judge if a stock is over or under valued in relation to a company's competitors in the same industry.  Then again investors aren't always rational players, sometimes there's a herd mentality.  A stock that's quickly climbing will attract more investors which will keep the upward momentum going until they start to take profits which then causes the price to fall.

That's how I read NCsoft.  Their stock bounced around between 50,000 to 100,000 KrW and then Aion came out and was an extreme hit.  That one game doubled profits and didn't really affect the sales generated from their other games.  Then they start hinting that this is just the start of things to come.  Look, we have this new game Blade & Soul and look Guild Wars 2 is more like a real MMO with 80 levels and a huge world.  And they will duplicate the what happened with Aion.  And once Aion goes world wide it's sales will also grow a lot.

So the stock rocketed up and up and up because you don't want to be the last one in.  From the start of 2009 when the stock was just 55,000 and ended up at 380,500 Oct 19th, 2011 when sanity returned.  That's a 100% growth rate per year over that span.  That's insane.  So some investors decided to take their profits and it starts to go down.  Every so often someone will decide that after a 20% price decline it's time to buy.  Price goes up and then others decide to take their profits and it goes down again.  Rinse and repeat.  But that's expected.  No stock just goes up.  However quarterly report after quarterly report showing that sales growth has slowed to a crawl and even reversed is going to convince more and more people to get out. 

Finally B&S comes out and is initially reported to be the number one game in Internet Gaming Cafes.  Guild Wars 2 has a million pre-sales and quickly sold two million within a month.  But when the quarterly report comes out in November it turns out that B&S looks to have cannibalized the sales income of NCsoft's other games.  And while GW2 does well it's limited to the difficult, from Korea's perspective, western MMO market and it's income is centered around game sales/item shop and not subscription.  That leaves a big question about continuing sales growth.

On top of the the CEO/founder sells the bulk of his personal stake in the company to a competitor.  Yes it did happen at the same time as a joint cooperation announcement but it presented doubts.  Investors hate doubts.

Now during this our dinky little game closes.  A game that's relatively unheard of by gamers in Korea.  As a matter of fact all the games NCsoft has closed were relatively unheard of in Korea.  So there they don't have the rep of a MMO closer.  Lineage has been going for over 14 years, Lineage II for over 9 and Aion for over 4.

Since the west isn't interested in those titles they are focusing on the one big untapped market that they haven't had a large presence in and that's mainland China.  Now they think that China will love Blade & Soul.  That they will even like Guild Wars 2.  So that's where their placing most of their chips.  If China isn't a big new source of income it's not the end of NCsoft.  It's just the end of the company's growth hysteria.  The price will stabilize, probably near were it is right now and it will just linger as long as sales stay where they are.

Look at Microsoft.  Their stock price shot up at a similar annual rate until late 1999.  Then it dropped to a little below half of it's peak price since.  Unless NCsoft suddenly becomes a big player in China or in the smartphone/tablet game market, they don't seem to have another major MMO under development beyond Wildstar and the joint Nexon project.

Hey, that's my opinion.

[Beltor]

China has recently had a change of policy concerning MMO's. They are now stricter on allowable female imaging.  This may not matter on GW2 but from what i've heard about B&S, it might not be allowed in China without a major overhaul. However, i don't know the specifics on China's new MMO policies and i haven't seen B&S yet, except for the underwhelming images on their US website.