In a deal involving a company owned by Jared Kushner, a company that is basically just the Saudis, and $20B of debt.
You must log in or register to comment.
Hopefully it’s a leveraged buyout and this is the death of EA.
Edit: Haha I clicked the link and it really is an LBO.
It is a leveraged buyout.
Yup I added an edit. LBOs should be illegal man. Just search how many companies have been bought like this and then driven out of business.
Couldn’t happen to a nicer company
For a preview of what happens, look at the embracer buyouts. This is essentially a funeral
Yup. Or Toys R Us, or Debenhams (UK), or any other number of LBOs which led to the death of the company.
Good riddance. I hope by “private” they mean we won’t hear from them again–they’re a very private company, they keep to themselves, and never say anything. That sort of private.
(I know that’s not what it means)
Is this better or worse than being a public company?
Depends. This is a leveraged buyout and there are countless examples of other companies bought like this and they don’t last long.
They take on massive debt to buy it. Then they shift that debt to the company they bought and away from the individuals. Then that company is crippled paying down interest so they can’t innovate (not that EA did), then they’ll have to cut costs and the product will diminish. Likely pay out billions in dividends to the buyers can make profit and in 5-10 years EA will go bust or get sold again.
The banks will be left holding the bag, but probably covered their loses by that time so can write off the rest of the debt.
This specific instance? Worse.
It’s being bought by blood money (Kushner’s $2billion investment/bribe to hush up the US government about the brutal murder of a US resident journalist at the hands of the Saudis). Plus a country that somehow is even more squeamish about content than the US is in charge - look forward to way more censorship.
Reddit, and by extension Lemmy, have this infatuated vision of how private companies are actually great for customers because whenever somebody asks about Steam the explanation given is that if this were a publicly traded company it would be horrendous but because it’s private everything is perfect and there are rainbows inside their offices.
The truth is EA will be just as aggressively profit driven as it already is, the new owners will try to reduce costs just like always, and IPs that sell more will continue to be prioritized just like before.
Essentially a private company can be owned by a dickhead, or a nice person who’s not all about profitmaxing. A publicly traded company is forced to maximize shareholder value.
Valve as a publicly traded company would quickly become another EA/Microsoft/Whatever, because it’s only the next quarter that matters. Valve under GabeN has been built to bring in large, and yet sustainable profits.
EA’s new owners are going to be the absolute worst. So it’s going to be a worse company than before.
Consider that Erik Prince’s murder-for-hire company is private. So is Xitter now that Melon bought it.
So it’s not that private companies are better, but rather that they have the capacity to be better. And it all depends on the owners.
The reason Steam is less bad is that its president is less of a dick. The reason that works is because he’s not beholden to other shareholders, because he’s the majority owner himself. If they were publicly owned, he wouldn’t have the liberties to make long-term decisions instead of (only) short-term money grabs.
But his decisions most likely aren’t the result of some bleeding heart morality so much as a less shortsighted profit calculation. Newell is still a billionaire, and not just because of the assets Valve owns. He apparently has several ships, which is several more than most people can afford. He also owns a custom yacht manufacturing company, which is also a lot more than most people can afford (both the products and the company). He might not be as all-around awful as other billionaires, but you don’t get this rich through your own work alone.
Private ownership isn’t a guarantor of customer-friendly behaviour. It just eliminates one factor forcing companies to prioritise profits, but it can’t replace customer protection regulations and oversight.
Gabe Newell is basically a benevolent dictator. Valve is proof that private companies have the potential to not completely suck and publicly traded ones basically always seem to suck.
Its just that usually private ones suck as well.
He apparently has several ships, which is several more than most people can afford.
That number for the rest of us being, of course, none.
Well, I can probably afford a small RC boat or something. Not quite the same caliber that could carry humans on the ocean, but more than nothing I guess.
Dangit, now I want to look up how much a model yacht would cost and if I could afford to brag “I’ve got a small fleet of yachts”…
Depends on your perspective.
This is bad from a business, creativity, and human rights standpoint.
However, it’s good that a shitty company like EA with predatory products is going to be even more exploitative and predatory from here on out.
I enjoy watching the useful idiots get taken for a ride.
Haven’t bought an EA game in over a decade. Don’t intend to change that anytime soon.
Public companies have a hard wired compulsion to increase value for shareholders. Every single decision is made with profit in mind. In the best cases you get milquetoast, inoffensive material everyone can enjoy. Ultimately, this leads to a relentless and aggressive pursuit of endless growth at any cost.
Private companies can take a loss here and there, they don’t have to report a bad quarter and so they can plan ahead. Which allows them to do two, non explains things. That approach allows them to build a robust and loyal consumer base which is quite valuable. So they’ll sell it off again and let the public companies milk them dry. They can also get up to some horrendously evil shit behind closed doors in a foreign country where the laws only apply to people who aren’t the ruling family and never have to answer for it. Though that kind of thing is usually reserved for like, chemical manufacturers and labor intensive luxury food markets. It may be that the Saudis are just diversifying and want a propaganda mouthpiece. Or one of the royals REALLY likes FIFA.
Hard to say.
Yes.
If it’s gone public, then generally going private is a bad thing. It’s usually some investors that are going to do something bad with the company.
A company that starts and stays private may be all the better for it (but that’s hardly assured either). If they are a success and didn’t bring a lot of investors, then it generally means they actually care about the work intrinsically.
Sail the high seas.
Had an EA Play so I could play NHL and FIFA, and the occasional ME Trilogy replay. Canceled it the moment the news broke about Kushner and the Saudis. Had paid for the year and was willing to sacrifice the final five months in the name of morality. But luckily they refunded me the difference.
And the worst get worst-er
101 how to make your company’s bad public image even worse.
Why is an anti-Semitic meme the picture for this post? Did a Jewish CEO buy the company?
That’s the profile picture for the reporter whose bluesky post this links to.
Saw that. I thought the article poster was being racist.
Dude what?
Nevermind it’s the reporters selfie. I thought this was a racist joke against EA.
Wtf? You think an image of a person makes something anti-Semitic? You see someone that looks Jewish and your first thought is this is anti-Semitic? Get off your high horse.
I gave up on EA a long time back, and them not making Alice: Asylum was the final nail in their coffin.
EA has basically been dead to me for a very long time, even though I know a couple of people who work there.
While the whole Saudi Arabia / Private Equity angle is terrible, part of me thinks/hopes/wishes that this is part of their whole sports-washing angle - and there is a slim but non-0 chance that there will be an improvement in the quality of their studio output over the next few years.
I’ll continue to avoid buying their games, but it would be nice to see those that still do not getting nickel-and-dimed as hard as they currently are.
Who knows, there is also the potential that this buyout backfires and Saudi’s human rights abuses become even more public knowledge as a result?
When times are as bad as they currently are, we have to hope.
I’d love to see the sports leagues pull their licenses
Oh, cool, another buyout where the buyer doesn’t have to actually pay for it, they just take out a loan and magically make the company pay for it.
It’s the workers who pay the price for the greed of the CEOs, shareholders, and the new owners.
This shit needs to be made illegal. All it does is kill off businesses. Sears and JoAnn Fabrics both died to this trash.
Toys R Us too 🤬
Basically Tesla, oof
Y’all shouldn’t be buying EA games anyway.
At this point, I see pirating The Sims as a moral imperative. There’s no reason the full game should be ~$1500.
I downloaded every EA game ever made and I don’t even want to play any of them. I have the files imprisoned on my computer, forever. Bwahahaha!
Yeah but we can also make a FOSS version of PlantsvsZombies & Sims
$1500‽ What the fuck‽
If people are willing to pay it…
Hell yeah, interrobang!
underrated unicode character
The franchise basically created the microtransaction.
As much flak as Oblivion got for horse armor, the Sims did it first.
I can’t wait to never play either of those games. Thank Ahura Mazda for indie games.
Due to Steam’s Autumn Sale putting the DLC anywhere from 30-50% off, you can currently get the complete game for the low price of only… $993.79.
I wish I was kidding.
And It won’t run.
So many of these DLCs are outright broken. For instance, the For Rent pack very well will corrupt your save file. I’ve had a glitch happen that was a for rent glitch, and I don’t even have the pack. Dine out doesnt function, my wedding stories doesn’t function. The game is still bland with $1000 of DLC.
It’s so bad, they added a toggle to turn off “unused packs” that break your game. You can now just uninstall them through the UI. Stuff you paid for, you can turn it off now, so your game runs more smoothly. Except, when It rolled out, it broke people’s games when they tried to use it, said they didn’t own the pack anymore, so you couldn’t turn a pack back on. Absurd.
Fuck The Sims 4, Fuck EA.
Rust console, is an old game, they released a new version to upgrade to new systems. Free to people who already owned the first gen game. They did this well imo. EA could never.
Why you might as well sail and get a fixed pack for basically free.
Or just find a better game. There are plenty of games where you’re not expected to pay and download additional files to have rain.
The Command and Conquer series has only a few or no equivalent right now, as far as I know.
There is INZOI, which should be superior to the Sims series, but its hardware requirements are very demanding.
Despite the existence of superior racing sims, some people still play NFSU2 but enhanced with mods.
I’m saying because in some places people like the games more than the corporation owning those titles (and sitting on, while keep on selling the games with the loot boxes), they’ll just pirate those copies.
Oh yeah, they milked that shit as much as they could. Really ruined the franchise with their bullshit.
Don’t forget how many years it went live and the absurd number of expansion packs.
The game’s 11 years old, a constant flow of DLC and expansions adds up over time.
So just don’t buy it all at full price I guess.
That’s over 100$ every year in dlc
Or $25 a quarter, and that’s if you buy every single thing they release.
There’s always the whales, but personally I’d skip the “Horse Ranch” expansion, or the one that added Fairies.
cries in Paradox
… And?
A shit ton of those couldve been free updates lolWell, their artists did make additional assets though, even if they may be recoloured versions.
And…? Cyberpunk, monster hunter, witcher, … All got visual updates in their lifetimes :p
Witcher, baldurs gate, monster hunter, gta5 and more got actual content updates too
deleted by creator
I dunno man. Consider it aspiration! Pirate 1500 minimum in EA games.
I wouldn’t even take that shit for free.
I was thinking about this deal and… I guess it makes sense the Saudis want in on the gaming industry. I recall a long while ago an old article about the industry (probably second hand via Polygon) that noted just how much Saudis whale on mobile and loot box games. It was so disproportionate, their nobility was like 2% of a mobile title’s revenue… literally just a few big families.
So my thinking is, EA, being the kind of shitty company it is, is actually probably pretty popular among Saudi nobility. That and FIFA, of course — imagine pay to win when you have infinite money.
Makes me think why Houthis and the Iranians hate them. Not just sectarian but also wanton excesses of kingdom.
I’m more cynical than that, I think it’s that Kushner and the Saudis have both identified gamers as a group susceptible to be influenced by auth-right messaging, and they want a piece of that.
They lost the FIFA games…
“Lost”.
They lost the fifa name, but fc is basically the same, and it still has all the players and club’s in it soooo… Its just a name change sadly
I couldn’t be more excited about what’s ahead,” said Jared Kushner, Chief Executive Officer of Affinity Partners.
Because it just wouldn’t be a story without a Trump family angle.
It saves so much time for him to be buying a failed company. It cuts out all the leg work he has to do.
If a company bought EA it would make sense if they were buying it for the IP. Someone who actually knows how to run a business could probably turn it around, but why is he buying it does he have another game studio that I’m not aware of?
