znga的担心# Stock
s*t
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这个文章写得有点道理。
Zynga Is Locked and Loaded -- but It Shouldn't Be
http://www.fool.com/investing/general/2012/04/17/zynga-is-locke
I did it. I gave in. I went and bought a copy of OMGPOP's
popular Pictionary knockoff Draw Something. I could have d
ownloaded the free ad-supported version, but I was in a fe
isty mood so splurged with the $0.99 pay version (you get
2,000 extra words!).The scene of the crime
My wife and I were at a friend's house, and the Draw Somet
hing bug had clearly bitten every single one of our amigos
, and considering its social elements it quickly spread to
us like a contagion. This was weeks ago, and the game pro
vided me well over a buck's worth of entertainment. Except
now ... I'm getting bored with it.
It's a fun little game, but ultimately can it really withs
tand the test of time, as our collective attention spans c
ontinuously shrink, for better or worse. How long can the
game really bump elbows with the likes of Angry Birds and
its fowl offspring?anImage
I have to wonder whether Draw Something will be little mor
e than a passing fad, as it begins to fade from my own con
sciousness. That's a key question that Zynga (Nasdaq: ZNGA
) needs to be asking itself right now, especially since
$200 million is quite a price tag for to buy a developer t
hat's mainly proved to be little more than a one-hit wonde
r so far. (Zynga tried to buy Rovio, too, by the way.)
I'd wager that few people out there could even name OMGPOP
's other mobile titles (Hint: There are two others). Given
up? That's because Puppy World and Boom Friends aren't pa
rticularly exciting, interesting, or innovative -- not tha
t Draw Something is reinventing any wheels any time soon.
A baby elephant gun
Zynga has effectively paid $200 million for a single title
and the small team of OMGPOP's developers (excluding this
one). The top spots in Apple's (Nasdaq: AAPL ) iOS App S
tore are definitely valuable, but Zynga won't be able to a
fford every title that climbs its way up, despite how badl
y it wants to expand into the mobile-gaming front with pla
tforms like iOS.
Apparently, Zynga thinks it can be done, as CEO Mark Pincu
s and merger exec Barry Cottle recently told Bloomberg tha
t it's still on the hunt for more acquisitions, and the $1
.8 billion in cash and investments on the books are ready
and waiting to be deployed to such ends.
The social gamer has picked up 22 separate companies over
the past two years, and Pincus is looking to do several mo
re acquisitions that are about the size of the OMGPOP deal
in the coming years. Remember when I called Zynga's curre
nt acquisition strategy unsustainable "in terms of both do
llars and integration," because of its dubious corporate e
thics and cutthroat internal culture? At least six of the
startups that Zynga has acquired have seen their founders
jump ship.
Zynga was able to poach Cottle from gaming giant Electroni
c Arts (Nasdaq: EA ) with a juicy pay package. The gaming
stalwart had outbid Zynga for PopCap Games last year, mak
er of Plants Vs. Zombies and Bejeweled.
Draw Something is estimated to be bringing in $250,000 per
day in revenue. That means it would take 800 days, or mor
e than two years, to break even with the acquisition price
on sales. Keep in mind that's revenue, not profit. That a
lso assumes that OMGPOP's other games aren't contributing
too much (a mostly fair assumption), and that Draw Somethi
ng can keep its top spot and maintain its revenue-generati
on rate for such an extended period of time -- not likely
on a platform as competitive as iOS.
A rhetorical question
Zynga is effectively extending a standing offer to acquire
any developer that makes it up the charts, either by luck
or by skill, which is not sustainable. That brings up the
age-old question: Would you rather be lucky or good? Don'
t bother answering that, because Zynga will still acquire
you regardless.
At the end of last year, before the OMGPOP acquisition, th
e company had about $123.9 million in goodwill and intangi
bles on its balance sheet -- less than 5% of total assets.
As it continues its acquisitive streak and grows its good
will and intangibles, it also increases the risk of eating
impairments down the road if some of these acquisitions p
rove not to be worth the hefty prices. This is particularl
y true as it pursues acquisitions of dubious value, like t
he OMGPOP deal.
Sorry, Zynga, but you overpaid for Draw Something. It woul
d have been cheaper to just copy it.
Zynga Is Locked and Loaded -- but It Shouldn't Be
http://www.fool.com/investing/general/2012/04/17/zynga-is-locke
I did it. I gave in. I went and bought a copy of OMGPOP's
popular Pictionary knockoff Draw Something. I could have d
ownloaded the free ad-supported version, but I was in a fe
isty mood so splurged with the $0.99 pay version (you get
2,000 extra words!).The scene of the crime
My wife and I were at a friend's house, and the Draw Somet
hing bug had clearly bitten every single one of our amigos
, and considering its social elements it quickly spread to
us like a contagion. This was weeks ago, and the game pro
vided me well over a buck's worth of entertainment. Except
now ... I'm getting bored with it.
It's a fun little game, but ultimately can it really withs
tand the test of time, as our collective attention spans c
ontinuously shrink, for better or worse. How long can the
game really bump elbows with the likes of Angry Birds and
its fowl offspring?anImage
I have to wonder whether Draw Something will be little mor
e than a passing fad, as it begins to fade from my own con
sciousness. That's a key question that Zynga (Nasdaq: ZNGA
) needs to be asking itself right now, especially since
$200 million is quite a price tag for to buy a developer t
hat's mainly proved to be little more than a one-hit wonde
r so far. (Zynga tried to buy Rovio, too, by the way.)
I'd wager that few people out there could even name OMGPOP
's other mobile titles (Hint: There are two others). Given
up? That's because Puppy World and Boom Friends aren't pa
rticularly exciting, interesting, or innovative -- not tha
t Draw Something is reinventing any wheels any time soon.
A baby elephant gun
Zynga has effectively paid $200 million for a single title
and the small team of OMGPOP's developers (excluding this
one). The top spots in Apple's (Nasdaq: AAPL ) iOS App S
tore are definitely valuable, but Zynga won't be able to a
fford every title that climbs its way up, despite how badl
y it wants to expand into the mobile-gaming front with pla
tforms like iOS.
Apparently, Zynga thinks it can be done, as CEO Mark Pincu
s and merger exec Barry Cottle recently told Bloomberg tha
t it's still on the hunt for more acquisitions, and the $1
.8 billion in cash and investments on the books are ready
and waiting to be deployed to such ends.
The social gamer has picked up 22 separate companies over
the past two years, and Pincus is looking to do several mo
re acquisitions that are about the size of the OMGPOP deal
in the coming years. Remember when I called Zynga's curre
nt acquisition strategy unsustainable "in terms of both do
llars and integration," because of its dubious corporate e
thics and cutthroat internal culture? At least six of the
startups that Zynga has acquired have seen their founders
jump ship.
Zynga was able to poach Cottle from gaming giant Electroni
c Arts (Nasdaq: EA ) with a juicy pay package. The gaming
stalwart had outbid Zynga for PopCap Games last year, mak
er of Plants Vs. Zombies and Bejeweled.
Draw Something is estimated to be bringing in $250,000 per
day in revenue. That means it would take 800 days, or mor
e than two years, to break even with the acquisition price
on sales. Keep in mind that's revenue, not profit. That a
lso assumes that OMGPOP's other games aren't contributing
too much (a mostly fair assumption), and that Draw Somethi
ng can keep its top spot and maintain its revenue-generati
on rate for such an extended period of time -- not likely
on a platform as competitive as iOS.
A rhetorical question
Zynga is effectively extending a standing offer to acquire
any developer that makes it up the charts, either by luck
or by skill, which is not sustainable. That brings up the
age-old question: Would you rather be lucky or good? Don'
t bother answering that, because Zynga will still acquire
you regardless.
At the end of last year, before the OMGPOP acquisition, th
e company had about $123.9 million in goodwill and intangi
bles on its balance sheet -- less than 5% of total assets.
As it continues its acquisitive streak and grows its good
will and intangibles, it also increases the risk of eating
impairments down the road if some of these acquisitions p
rove not to be worth the hefty prices. This is particularl
y true as it pursues acquisitions of dubious value, like t
he OMGPOP deal.
Sorry, Zynga, but you overpaid for Draw Something. It woul
d have been cheaper to just copy it.
