A year ago, all eyes watched as Take Two Interactive began to fight off EA’s hostile takeover bid. Today, stock watchers checked back in to see how the company was performing months removed from leaving that challenge behind. The result was mixed.
In earnings announced after the close of markets, the game publisher reported higher than expected sales for the first quarter but set second quarter guidance below analyst targets.
Tuesday was a bad day for Blockbuster shareholders. Open to close, the company’s stock crashed 77%, dropping from 96 cents to 22 cents a share. The massive sell-off was triggered after reports circulated saying the company hired Chicago law firm Kirkland & Ellis to explore a possible bankruptcy filing.
In rebuttal, Blockbuster told a different tale about its intentions for the retainer. The company says it hired counsel to help with restructuring and not to prepare for court protection.
Did the reports get it wrong? Or did traders rush to action too fast, misinterpreting the news along the way?
Karen Raskopf, Blockbuster’s spokeswoman, said the company hired Kirkland & Ellis “for assistance with our ongoing finance and capital-raising initiative." Regarding Blockbuster’s plans, she said, “We do not intend to file for bankruptcy."
Blockbuster’s “ongoing financing” issues aren’t anything new. Click to Read More
The Gibson Les Paul is an icon. Bob Marley was entombed in a mausoleum with his. Duane Allman used one. Slash, the Edge, Mick Jones, Jimmy Page, Keith Richards, Neil Young, Paul McCartney – some of the biggest names in Rock have played it. It’s no surprise, given that, that Activision licensed the guitar’s likeness (and Gibson’s brand) to give game players an axe to shred for the Guitar Hero game franchise. What was a surprise was that Gibson turned on its partner of three years with patent infringement claim last year.
Showing teeth that seemed to come out of nowhere, Gibson said Activision’s Guitar Hero franchise, and eventually, all things guitar-gaming (Gibson also sued EA, MTV Networks, Harmonix and major retailers selling Guitar Hero or Rock Band games), infringed on its prior invention.
Monday, several stories seizing on a blog post from Gawker Media’s Kotaku suggested struggling Midway Games might be in the process of selling off its Mortal Kombat game franchise. Several of the articles (on the basis of part of the story, as well) also went so far as to attack the company for pursuing a key-personnel incentive plan at the same time the bankrupt company appears to be cutting back payouts to laid off staff.
The stories’ paint a grim picture of the company’s practices and it’s easy to jump in the chorus of castigation. Unfortunately, headlines sometimes oversell their news story and news stories sometimes under emphasize all of the facts. Here, however questionable some of what’s happening at Midway may (or may not ) be, review of the company’s bankruptcy filings, which are embedded or linked to below, shows the situation is more complicated and far less definitive than many of the reports suggested.
First and most importantly, contrary to suggestion, the Incentive Plan (which provides for $3,775,000 to be set aside to pay incentives to up to 29 employees on the completion of three milestones) is not active. While endorsed by the company, it has not been approved and set in place. Money hasn’t been “set aside.” Midway provided the Bankruptcy Court with a copy of the plan as a proposal on February 23rd (see embedded file below) and requested creditors voice their objections (if any) by March 3rd. A hearing was tentatively scheduled for March 10th. At this point, there’s no guarantee creditors will agree to the plan as written (or at all), or that the Bankruptcy Court will approve its implementation.
In a February 2007 interview for the PBS series CEO Exchange (PDF) Sony’s CEO Sir Howard Stringer said one of the first jobs he had to do at Sony was “reach out and get people to collaborate with each other.” Sony was too vertically integrated, he said. He had to break up the vertical “silos” to better serve the increasingly digital world. It’s two years removed from those remarks but Stringer is finally getting some of the changes he sought.
Following Yahoo’s restructuring announcement yesterday, Sony announced a major reorganization of its own today. Effective April 1st, there will be two new business groups and a reworked organization chart.
Incoming CEOs invariably build their own teams, it’s just a matter of time. John Riccitiello did some housekeeping when he rejoined Electronic Arts, and Carol Bartz was certain to do it at Yahoo. Thursday, after six weeks of “being in student mode” and “slowly getting smarter about what makes [the] place tick,” she announced her sweeping changes.
CFO Blake Jorgensen is out. He’s tendered his resignation but will stay on until a replacement is found.
CTO Ari Balogh will keep his title and also take the added moniker of EVP of Products. In the combined roll, he will be at the helm of a newly created “Products” group responsible for all of the “vision, strategy, and quality of every product [Yahoo creates] regardless of region, device format or category.”
Programming, partnerships and sales will be handled by two groups, distinguished by region. The North American side will fall to the charge of Hilary Schneider, EVP, North American Region. Among her tasks, the onetime CEO of Knight Ridder Digital and Red Herring will also oversee Yahoo’s global mobile initiatives. (David Ko, working under Schneider, will be the lead for Yahoo’s mobile business, strategy and monetization teams. He’ll replace a departing Marco Boerries). The International Group’s head is yet to be determined.
Long before the word frenemy hit the buzzword bingo board, the proverb of complex relations was “the enemy of my enemy is my friend.” In the increasingly tangled melting pot that is online media and advertising, the sentiment is as true now as ever. Today, competitors are often cooperative colleagues at the same time. Proof: rivals Fox (News Corp) and NBC/Universal jointly developed popular web video portal Hulu despite otherwise battling each other for prime time TV audiences. More proof: Microsoft is drawing competitors together to guide the development of its newest ad management tool, Pub Center.
Using the Interactive Advertising Bureau’s annual meeting as a launching platform, Microsoft announced a Publisher Leadership Council on Monday. The group joins together rivals including Dow Jones Online and the New York Times, as well as Time Inc., Viacom and IAC/Interactive. Normally, these companies compete aggressively with each other for ad dollars and audiences online.
