Currents Top Ten I Britain Jails Pirates I China Restrics Minors from Violent Games I Midway Acquires Ratbag I Atari May Delist from Nasdaq I Midway Takes a Hit I Stock Ticker
Issue #18 It Takes a Road to Go Nowhere August 6, 2005

Front Page

Today is the 60th anniversary of the day the atomic bomb was revealed to the world. I'm not here to start a debate about whether the dropping of the bomb was necessary, as I feel the only way to know for sure would be if we could see the outcomes of all the alternative choices -- which we can't. So I'll just say that it's a shame that so many innocent people died. I'm pretty sure we can all agree on that.

On a lighter note, Half-Life 2 continues to blow my mind. I just finished the Water Hazard area and have yet to stop having fun. But on a more appropriate note, I have a column for you here today. It's shiny, sleek, and sexy and you can play MP3s on it. Not only that, but it delivers the latest-breaking news about the goings on behind the scenes of the RP gaming industry. Read away.

 Currents Top Ten

The gods are smiling upon us this week for sure. We have several exciting new developments with game sales including not just one, but two RPGs, as well as a GameCube game. Someone out there must have saved some orphans from a burning building because this is nothing short of a miracle.

Natsume's Harvest Moon: Another Wonderful Life for GameCube makes it's debut at the number five spot. Nippon Ichi's Makai Kingdom is also ringing in, but a little lower than its fellow RPG -- eighth place. The Xbox version of Black Hawk Down, however, is claiming this week's crown. Other than those new additions, EA's NCAA Football, Battlefront, San Andreas, FlatOut, and the Halo 2 expansion are still going strong.

Position Title Publisher Platform
1 Delta Force: Black Hawk Down NovaLogic
2 NCAA Football 06 EA Sports
3 Grand Theft Auto: San Andreas Rockstar Games
4 NCAA Football 06 EA Sports
5 Harvest Moon: Another Wonderful Life Natsume
6 Delta Force: Black Hawk Down NovaLogic
7 Halo 2 Multiplayer Map Pack Microsoft Game Studios
8 Makai Kingdom: Chronicles of the Sacred Tome NIS America
9 FlatOut Empire Interactive / VU Games
10 Star Wars: Battlefront LucasArts

Source: GameSpot

 Britain Jails Pirates

Those who read last week's issue might remember a story about Operation Site Down, a campaign to put distributors of illegally obtained software behind bars. England is running a similar campaign of its own, called Operation Zouk. One year ago this month, Operation Zouk led to the arrests of 57 software pirates. They were all eventually charged with possessing illegally obtained music, movies, and games. British authorities uncovered 28,000 ($50,000) worth of data from the raids.

The big news this week is that the first convictions from the initial arrested batch of 57 have been made. Two people, formerly a married couple, were sentenced to 18 months and 6 months in prison, respectively. The couple was caught for selling pirated discs out of their own home. It's strange that charges for illegal distribution were not mentioned, though.

Source: GameSpot

 China Restrics Minors from Violent Games

With the recent legislative trend going on in the United States with banning the sale of mature games to minors, it looks like places overseas are starting to follow suit. China, for instance, has decided to ban the sale of any MMORPG involving player-killing to children under the age of 18. The laws were passed by the country's Ministry of Culture and Ministry of Information Industry this week. The two ministries have also asked Chinese online game operators to develop and install "identity authentication systems" to keep minors from playing violent games online.

Chinese authorities have been taking a closer look at online gaming with a more cautious eye, especially since 2004. The two ministries are also planning to keep online gambling sites and games with pornographic content out of the hands of minors.

Source: GameSpot

 Midway Acquires Ratbag

No, Midway didn't go out and buy a bag full of rats. Ratbag is an Australian game development studio that has been purchased in its entirety by Midway for an unpublished amount of money and 418,570 Midway shares. The studio will be renamed Midway-Australia.

After Ratbag is added to Midway's pile of acquired game studios, it'll be the seventh such studio for Midway. The company has development houses in San Diego, Seattle, Austin, Los Angeles, Munich, London, and now Adelaide, Australia. According to Midway, the new Australia studio is already hard at work on many unannounced projects for both current- and next-generation consoles.

The former Ratbag studio will be helmed by Matt Booty, Midway's senior vice president of worldwide studios. Booty said in a statement that the acquisition of Ratbag will add "development expertise in driving and on-foot combat" games.

Source: GameSpot

 Atari May Delist from Nasdaq

This week, the SEC (Securities and Exchange Commission) gave Atari a warning stern enough to make Martha Stewart cry. The reason behind the warning was that Atari was no longer in compliance with 'Marketplace Rule 4350' -- dealing with the company's composition of its audit committee. Rule 4350 states that any public company listed with Nasdaq needs to have an audit committee made up of three independent directors, one of whom needs to have a strong financial background. Atari fell out of compliance with this rule when board member Thomas Mitchell and CEO Jim Caparro resigned earlier this year.

At this time, Atari remains one financially-educated board member short on its audit committee. The SEC has given Atari until August 17 to replace the missing committee member. "After reviewing such plan... the NASDAQ Staff will either permit Atari to proceed with execution of that plan or the NASDAQ Staff will send a notice of delisting," said the SEC in a statement.

Source: GameSpot

 Midway Takes a Hit


Midway announced to analysts in a conference call this week that it was hitting a pretty rough patch, financially. Despite two hit games released last quarter -- Area 51 and Unreal Championship 2 -- Midway couldn't save itself from a nearly $30 million loss.

Midway CEO David Zucker told analysts during the call that the company had raked in less money and lost more money than was originally budgeted. Specifically, Midway brought in $36.9 million last quarter, compared with last year's second-quarter earnings of $47.3 million. The total loss for the quarter this year was $29.9 million. The total lost for the quarter last year was only $11.2 million.

The last time Zucker spoke with analysts he was boasting expected net revenues of around $40 million and a net loss in the neighborhood of $25 million. The unexpected new net loss is being partially blamed on "lower-than-forecasted sales of Unreal Championship 2."

Midway has now changed its expected fiscal year revenues to a less ambitious amount. "With that move, the Company now expects net revenues of approximately $200 million, as compared to the company's previous estimate of $225 million," said Midway this week. "Additionally, the company now expects a net loss of approximately $60 million, an increase from the company's prior expectation of a net loss of approximately $47 million."

Source: GameSpot

 Stock Ticker

The first thing I'm noticing about this week's stock update is that EA is continuing to climb slowly, but surely. Like I said last week, though, expect a fairly decent boost when Madden '06 hits the market. It'll make quite an impression.

EA predictions aside, it looks like Microsoft earned itself a pretty penny this week with a rise of nearly two quarters, earning them the biggest rise of the week. On the opposite end of the spectrum, Ubi Soft's loss of $1.57 makes it suck to be them for the week. Square Enix also took a hit of nearly 3 quarters. Though more companies are down than up this week, things seem fairly stable. Just keep your eye on EA.

Parentheses denote negative numbers. Prices as of market closing 08.05.2005

Symbol Company Market Standing Change
SNE Sony NYSE 33.18 (0.17)
MSFT Microsoft Nasdaq 27.76 0.44
NTDOY Nintendo PNK 13.20 0.00
ERTS Electronic Arts Nasdaq 59.00 0.11
SQNXF Square Enix PNK 27.57 (0.73)
KNM Konami NYSE 21.24 (0.59)
ATVI Activision Nasdaq 20.38 (0.27)
MWY Midway NYSE 13.75 (0.09)
SGAMY Sega PNK 16.05 0.05
UBSFF Ubi Soft PNK 56.32 (1.57)

Source: CNN Money

 Back Page

That'll do it for this week. I really need to try harder to get back into my enormous stack of unfinished RPGs, but with Half-Life 2 taunting me with its dirty sexiness, it's an impossible feat. I did just buy The Elder Scrolls III with both expansions for $20, so that should give me a decent RPG fix until I can get back into the genre at full force. Kind of ironic that I work for an RPG news site but I haven't really sat down and played a single-player RPG through its completion since probably Final Fantasy X. I'll come back one of these days, though.

Elliot "FPS Sellout" Guisinger

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