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As TV’s get thinner, bigger and better, people spend more of their entertainment time and money at home.  There’s less allure to the theaters.  For the TV Networks (and also aspiring TV/Net convergence services like Hulu) this changing dynamic represents big opportunity in the form of ad dollars.  It’s also a big risk (lower audience share if they can’t compete with rivals in programming).  To capitalize, networks are acquiring content voraciously.  Movie producers seem all too happy to oblige.  Just how big the stakes are became clearer today when News Corps FX cable network opened its coffers to buy exclusive programming rights.

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It’s often said that the entertainment industry, movies in particular, are recession resistant.  When the economy gets bad and people start feeling their wallets grow thinner they seek comfort and escape in the movies. They also gravitate toward the lower cost, lower key form of entertainment.  With the movies and gaming industry converging, I guess it’s no surprise to see early indicators that the gaming industry may be similarly resistant to a weakening economy (whether recession or not).   

Thursday retail tracking firm NPD released their monthly U.S. gaming sales roundup.  The numbers, as is becoming all too common, were good.  So far, the economy isn’t affecting the gaming industry at the register.

Overall, total sales, including hardware, software and accessories rose 34 percent versus a year ago hitting $1.33 billion.  The number was also up month to month besting the $1.18b in total sales registered in January.

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Take Two may be developing a boxing game but Electronic Arts has a mean left hook.  Today, they showed just how mean by escalating their takeover attempt for the maker of Grand Theft Auto to hostile.  EA also aimed a power punch straight at the jaw of T2’s management team by adding a purchase price adjustment that gives shareholders an ultimatum to decide between fattening their own wallets or those of the company’s management.

At issue is the underlying management agreement through which Zelnick Media is compensated for running Take Two.

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Earnings are down but forecasts are up.  The pipeline is good but some big shareholders are selling. Some small shareholders are suing. There are new severance packages but nothing to fear.  “All is well” is the tagline. 

Such is the ongoing saga of Take Two Interactive as they sort through their own issues with the added monkey of Electronic Arts’ $2 billion takeover offer on their backs.  It’s a story with more twists and turns than an installment of their popular Grand Theft Auto gaming franchise.   Here’s the plot summary for the latest news:

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When News Corp and NBC Universal partnered to launch their own video distribution portal many thought the odd couple partnership amongst two TV rivals would be little more than an expensive joke.  These weren’t companies known for building technology.  Nor were these companies, or their brethren in traditional media, known for playing well in the sandbox with each other.  The pairing seemed so unlikely many began deriding the then unnamed company with the name:  “Clown Co.” 

In August, the jokes got cruder when the company sold a 10% stake to Private Equity firm Providence Equity Partners.  The deal valued them, an unlaunched, non-public company at a billion dollars. Click to Read More

Most startups beg for money but having a billionaire backer has a way of twisting things like Alice’s rabbit hole.  That’s the case with Internet TV site Babelgum.  Monday, along with introducing a new beta release of their peer to peer software, the company announced that they were setting up a fund to invest in new original content. 

A total of €10 million has been budgeted.  The money will commission documentaries and shorts up to fifteen minutes in length.  They will air exclusively on Babelgum’s Internet network.

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S.W.O.T and Cost-Benefit analysis are nothing new to consultants. They’re tools of the trade.  They’re also part of the vernacular of turnaround specialists looking to right the sinking ship of a company in crisis.  When such an executive walks into a troubled corporation one of the first things asked is what is returning value and what isn’t.  “Where is the pain?” the saying goes.  Under-performing sectors that aren’t part of the strategic vision end up on a short list to be euphemistically cut.

Last year, private equity firm Terra Firma entered the fray of the struggling music industry and privatized “Big 4” label EMI.   Quickly, they went looking for the trouble areas and one of the first areas to be called out was the music industry trade groups like the RIAA and the IFPI (the International Federation of the Phonographic Industry).  At a reported cost to the label of nearly $130m a year, there were serious questions whether these assorted lobbying groups were returning enough value to justify the expense. 

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