Presumably this isn't entirely unexpected, and the 'torching' comment is over the top. 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.
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. I had stock positions invested for a while in Activision (90's) and Vivendi (early 2000's) and generally they seemed pretty random. A hit and the price would rocket up, a flop and it plummets down. 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. Got out of both positions at a small profit but a lousy return.
Contrast that with a company like Milton Bradley though, which milked the Monopoly game concept for millions if not a few billion dollars. It seems like games are more like 'books' or 'music' or 'movies' than something more durable like a 'word processor.'
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).
Back around the Instagram acquisition when HN went are-we-in-a-bubble-centric for a while, an opinion I read a few times is that you shouldn't be worrying about the bubble popping when everyone's talking about it, but rather when everyone stops.
Kind of a baseless argument, really. Still, has much changed? Isn't VC money still sloshing around the valley? Aren't startups starting up in ridiculous numbers? Isn't everyone and their dog an angel investor? That was my impression of where things were heading before stories about it dropped off in regularity. Even up here at the University of Calgary this year I've seen ads asking for talent to join startups, which is a first as far as I've noticed.
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. I had stock positions invested for a while in Activision (90's) and Vivendi (early 2000's) and generally they seemed pretty random. A hit and the price would rocket up, a flop and it plummets down. 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. Got out of both positions at a small profit but a lousy return.
Contrast that with a company like Milton Bradley though, which milked the Monopoly game concept for millions if not a few billion dollars. It seems like games are more like 'books' or 'music' or 'movies' than something more durable like a 'word processor.'
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).