What does this mean? That Zynga will pay OMGPOP less than what we had heard? How can they do that?Ī writedown (see ) means that they are revising the previously announced value of an asset they own downwards. The treatment Zynga getting re-assures me that we aren't in a bubble, in spite of what some would say (although not so much now, which is nice). It seems like games are more like 'books' or 'music' or 'movies' than something more durable like a 'word processor.' Got out of both positions at a small profit but a lousy return.Ĭontrast that with a company like Milton Bradley though, which milked the Monopoly game concept for millions if not a few billion dollars.
That suggested to me that a 'fashion' stock (where the product was as much fad/fashion driven as it is quality/non-quality driven) is really only good for trading, not for longer term growth. A hit and the price would rocket up, a flop and it plummets down. I had stock positions invested for a while in Activision (90's) and Vivendi (early 2000's) and generally they seemed pretty random. The stock price was already valuing them a lot lower than their pre-OMGPOP buy so this seems more like a recognition of that in order to make their balance sheets look a bit more credible.
Omgpop writedown plus#
Microsoft wrote off $6.2B of their AQuantive purchase in July, assuming 2000 days (5 years plus a few months) that is $3.1M per day, roughly 6x the 'torch' rate in this article. Presumably this isn't entirely unexpected, and the 'torching' comment is over the top.
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