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CURRENTS
Issue #98
December 5, 2008
Back to Work
Front Page

Welcome to the ninety-eighth edition of RPGamer's Currents Column!

I hope you all enjoyed you Thanksgiving week as much as I did. I was lucky enough to spend my holiday with a lot of family and friends. I also spent a lot of time playing Yakuza 2. What an amazingly fun brawler/RPG hybrid. It also feels like the gaming industry took a bit of a vacation, because I just didn't see a lot of big news this week. Which is fine, a lite week is fun too.

So let's get on with the NEWS!

One Bad Thing After Another For The House of Mortal Kombat
Another doom and gloom story...

It has been just one bad thing after another for Midway recently. Let's start at the beginning of this ongoing tragedy for Midway. About two weeks ago Midway received a warning from the New York Stock Exchange concerning a possible delisting of its stock. The company has fallen below the minimum standard for listing stock on the NYSE. The company failed to achieved a minimum closing price of one USD for over thirty consecutive days of trading. Midway was then told that it has six months to improve its stock's standing or it will be delisted completely. A prospect which seems very unlikey considering that Midway has recently laid off 20-30 staff, the company's chairperson has steeped down, it has losses over 74 million USD, and worst yet its largest stock holder has pulled out of the company.

Sumner Redstone and his holding company have sold his 87% controlling stake in Midway to Mark Thomas, a private investor, on December 1st. He sold his shares at a huge loss for only $100,000 USD, or about $0.0012 per share, far below Midway's previous closing price of 38 cents a share. He is also going to get $70 million in receivables. This is money that Midway is owed from customers. So there are no real winners in this deal especially when you consider how the stock market has reacted. Midway's share price has fallen 40% since Monday to 23 cents a share. At this rate it is looking more and more likely that Midway will in fact be delisted from the NYSE.

Now Midway is facing another new problem. Because of the sale of Redstone's shares to Thomas, Midway's creditors, holding $150 million of debt, are now able to demand repayment in January. Midway had publicly admitted that it will default on its debt if forced to pay, meaning Midway could go bankrupt in 50 days. Wedbush-Morgan game analyst Michael Pachter has commented on Midway's current situation, saying:
It's really interesting, because the creditors cannot expect Midway to repay unless the company remains in business. If the creditors compel bankruptcy liquidation, they'll get something, but arguably less than the full $150 million. Midway's assets are worth something, but in this market, it is hard to figure out how much. As a comparison, THQ has an enterprise value of only $80 million, so Midway's assets in liquidation would have to be worth twice as much as THQ's (as a going concern) for the creditors to be repaid.

My guess is that Midway works out a deal with the creditors and remains in business, but they are going to have to start generating sustainable profits soon, or their creditors will become impatient.

This is a steady downward spiral for Midway. While Midway hasn't really made any stellar RPGs that the RPGamer community cares about, it is still important to take note of a once important videogame company now on life support.

CODENAME: Jasper
I guess red rings of death and harddrives are no longer an issue...

This will make it that much easier for Arcade users with out a hard drive to jump right into The New Xbox Experience and start saving games right out of the box. There have been a lot of rumors floating around recently about a new batch of Xbox 360 Arcade units with a few improvements under the hood. Well it turns out those rumors were right as Microsoft has confirmed that the new "Jasper" arcade units are shipping with 256MB of internal flash memory, replacing the 256MB memory unit that was included in the box. A Microsoft Representative said this about the new arcade units:

"We are constantly updating the console's more than 1700 internal components. We can confirm that we are moving to internal memory for the Xbox 360 Arcade. The physical internal memory is the same size as the previous external memory units -- 256MB."

It is currently unknown if all 360 SKUs will be receiving internal memory as well, but it seems rather unlikely when you consider that the Arcade unit is the only one without a hard drive. On the other hand, all "Jasper" 360s do contain a much needed upgrade to its graphics chip which could potentially put an end to the infamous Red Ring of Death. Jasper 360s use a smaller 65-nanometer graphics chip that consumes much less power than the graphics chip on previous Xbox 360s. The smaller chip is also fit more securely into its motherboard socket, which means that it is less likely to come loose from the motherboard due to overheating. That alone should help put an end to users having to deal with Red Ring of Death and the accompanying customer service calls for a replacement.

Oh one final change to the new hardware is a move from a 175-watt power supply to a smaller 150-watt power supply. Well, upgrades in general are always fantastic. So if anyone out there has been on the fence about getting an Xbox 360, now seems as good a time as any to jump on the bandwagon. It's an especially good idea if you're going to dive into impressive JRPGs like Tales of Vesperia.

Sources: 1up | Joystiq
QUICKIES: A few Small, But Interesting News Stories!
Because who has time for giant articles
  • DSi breaks 500,000 units
    It has been a month since Nintendo's new handheld, the DSi, launched in Japan and I'm sure that Nintendo couldn't be happier with the results. The company has already sold over half a million units; according to Enterbrain over 535,379 units to be exact. It just barely missed the first month sales of its predecessor, the DS Lite, which sold 550,000 in its first month. Time will only tell if the rest of the world will be as enthusiastic as Japan has been when the console launches worldwide sometime in mid 2009.

  • South Korean Government Has Pledged $236 Million to Videogames Industry
    This is a bit of refreshing news, a government strongly supporting the game industry. South Korea's government has pledged KRW 350 billion, 236 million USD, to prop up South Korea's videogame industry until 2012. The aim is to transform the local industry into becoming one of the 3 largest in the world, next to the United States and Japan.

  • SE looking to buy Eidos?
    Square Enix just recently made a takeover bid for Eidos, the house behind the Tomb Raider Series. Square Enix has recently started looking to the West in order to expand their market. A move like this comes as no surprise as SE has also just recently started a new U.S bases studio called Square Enix L.A. Eidos is also currently being courted by Warner Bros. Interactive, EA, and Ubisoft. So while SE might not outright buy Eidos, it is possible that the company will walk away with a few single assets. SE president Yoichi Wada is reportedly interested in IO Interactive, the creators of the Hitman series and Kane & Lynch. Square Enix's move westward is getting more interesting by the day.

  • Wii Making $6 profit per console
    So we all knew that Nintendo has been making money hand over fist on the Wii, but how much profit exactly? Nintendo is making about six dollars off of every Wii sold according to estimates by analysts from Macquarie Securities. That's a lot of money when you consider that Nintendo has managed to sell around 19 million units worldwide; about 114 million dollars in profit. Not to mention the fact that Sony loses money on ever PS3 sold and Microsoft manages to just break even on the Xbox 360. Nintendo was very smart in designing as the Wii's lower hardware specs play a large role in the hardware's lower production costs. With margins like that, who needs to be cutting edge? So there you have it, Nintendo is making a fortune before they even sell a piece of software. I guess it really does print money.


Sources: Gamesindustry | 1up | Kotaku |

Poor Midway, I should just start a new Midway death march section. Oh well, at least all the other news was full of fun and pep. Well back to play Yakzua 2 for me. Oh and I also just got into the Home Beta, so I'm off to see if Sony's little social experiment was worth the wait.

See ya'll next week

Emanuel Merino
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