Seriously Hodapp, having an objective opinion on the matter must mean you're on their payroll. Can you make it anymore obvious?!
Yes, because PR persons openly discuss why the company they represent makes certain business decisions.
BTW: IF you checked the Japanese website, DeNA states that this was a media news that is not approved or verified by them. They just say the news did not come from them. http://www.c-direct.ne.jp/public/japanese/uj/pdf/10110213/20101008189783.pdf
Why the Hodapp attack? Just because he was stating the reasoning behind this acquisition and how it makes sense? Traditionally, the low-end of valuations for gaming companies is 5x invesment or revenues. With 40,000,000 in investments, the company is worth at least $200 Million. Since actual earnings aren't public information, we can't determine the value of the company, but it should be assumed that DeNA has access to their financial records. Some stable gaming companies get valued at 10x their investments (or revenues), which means that $40 mill for ngmoco investments could value the company at $400 million. Here is an interesting article on ngmoco: http://www.businessinsider.com/digital-100#94-ngmoco-94
Something to consider when figuring the earnings of ngmoco is that even though their games are rarely in the top grossing, they're almost always listed somewhere on the top free download listings. I couldn't even begin to accurately guess the number of daily active users they have, but it wouldn't surprise me at all if that number was in the millions with how long they've been around. Even at the absolute lowest CPM's, millions of people viewing in-game ads on a daily basis adds up to a truckload of cash which obviously has no effect on your top grossing listing on the App Store. Indie developers who have gone freemium and shared numbers with me have blown me away by hinting at what they've made with Admob or iAds. As much as I hate to say it, it seems like if you want to make crazy cash on the App Store, freemium is the way to do it.
Well, looks like it's going down for sure now: http://toucharcade.com/2010/10/12/dena-to-acquire-ngmoco-for-400-million/
Yep, it's official. This TechCrunch article is actually really interesting on the matter and brings up a few neat points: http://techcrunch.com/2010/10/12/done-deal-dena-to-announce-ngmoco-acquisition-very-soon/ 1. ngmoco revenues are in the neighborhood of $30 million, a figure I don't think has ever been publicly quoted before. 2. The acquisition was easy to swallow for DeNA because of the Yen trading at 15 year highs against the US Dollar. 3. DeNA is big about cross-platform stuff... So while ngmoco originally started with intentions to be iPhone exclusive, something tells me that's going to change in a big way. The $30m figure is the most surprising. I always assumed ngmoco was making money because everyone else doing freemium stuff is making fist fulls, but to be a two year old company with $40m in funding that likely would have been cashflow positive next year is pretty unbelievable.
So it was true after all huh. Wonder if I should Update the thread title to say " DeNA potentially buying ngmoco for over $400,000,000? UPDATE: Sh*t just Got Real !!"
That really is a lot of money. But they wouldn't buy if they didn't see growth there. I wonder who will be next, and for how much?
http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=aR2pj42UWido Investors don't like it. Probably think they overpaid.
