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[monchi-kun]

http://www.nypost.com/business/48698.htm

GAMING WEB SITE GOES ON THE BLOCK

By TIM ARANGO
June 21, 2005 -- EXCLUSIVE

IGN Entertainment, an Internet company that focuses on the video game industry, is up for sale and could fetch nearly $850 million, The Post has learned.

The company has been making its pitch to virtually every big media company, while at the same time has also considered going public, sources said.

Sources who have heard its pitch say the company is seeking a valuation close to $850 million - a large number considering the company was taken private in 2003 by Great Hill Partners, a Boston private equity firm, for just $26.4 million.

IGM has also hired investment bank Lehman Brothers to explore its options.

Media giant Viacom and Yahoo! are said to be interested. Viacom, however, is said to be interested in the gaming site space, but more price sensitive.

The company, which is based in Brisbane, Calif., operates websites aimed at teens and men 18-34, a coveted demographic among advertisers.



Among videogame enthusiasts the company is known as the premiere site for editorial content about the the videogame industry and reviews of new games.

IGN has a monthly audience of about 27 million users, according to the research group Comscore Media Metrix. Earlier this month the company bought AskMen.com, which IGN says has the highest audience of male visitors aged 18 to 34.

A spokesperson for IGN did not return a call seeking comment.

Traditional media companies are increasingly eyeing the videogame industry as they seek new ways to grow. For example, last year Time Warner's Warner Bros. movie studio purchased game maker Monolith, and Viacom appointed a special board committee to evaluate potential videogame deals.

Viacom's CEO and controlling shareholder Sumner Redstone personally controls Midway Games, and has disclosed in a regulatory filing that Viacom may purchase Midway.

IGN, then known as Snowball, went public in March of 2000, too late to fully capitalize on the Internet boom, and in 2002 switched focus to concentrate solely on the entertainment industry. It was taken private in 2003.

 

[DarienA]

Surprising considering they buying spree they were on....

 

[Ghost]

$850 million? W.T.F.

 

[VictimOfGrief]

Lets hope that CNET buys them. LOL :lol

 

[akascream]

I don't really like ign outside of thier nice quicktime movies, but wtf does 'sell out' mean anyway. I hate that bullshit, it's just business, not some altruistic entity.

 

[Gattsu25]

IGN - sellouts?

.

 

[Mihail]

I'm one of those cynics that thinks the NA video game industry is headed for either a crash or a rapid decrease to the levels Japan is seeing (probably late next gen or early next-next-gen). As such, I believe it would be a sucky investment for a company to pay 850 million for a website that focuses on video games. But maybe they can rely on their filmforce and men-related stuff to stay afloat.

 

[Mihail]

I don't really like ign outside of thier nice quicktime movies, but wtf does 'sell out' mean anyway. I hate that bullshit, it's just business, not some altruistic entity.

I think he was using the term for its technical meaning, not with a negative connotation.

 

[Shaheed79]

I'm one of those cynics that thinks the NA video game industry is headed for either a crash or a rapid decrease to the levels Japan is seeing (probably late next gen or early next-next-gen). As such, I believe it would be a sucky investment for a company to pay 850 million for a website that focuses on video games. But maybe they can rely on their filmforce and men-related stuff to stay afloat.

What do you think is going to lead to this massive decline in Western gaming interests?

 

[akascream]

I think he was using the term for its technical meaning, not with a negative connotation.

Heh, yeah, I'm just bored at work. Slack would be appreciated. =P

 

[Mihail]

What do you think is going to lead to this massive decline in Western gaming interests?

Meh, I don't want to hijack the thread with tiny facts, vague sources, and etc., so I'll just go over the main, conceptual reason:

Who are the people feeding the industry right now? Or, rather, what are they like? They are hyped, they are excited, they are energetic. A customer base like this usually inflates a market past the point at which it can sustain itself. I know an overused example, and an extreme one at that, is the internet boom and bust from a few years back.

Although video games are old to the hardcore gaming community, they are still very much a new and "in" thing to the mass market. I feel as soon as this excitement of the new passes, few people will want to hang around and put in the kind of money gaming requires.

 

[SKOPE]

Surprising considering they buying spree they were on....

Acquired too much debt in the process?

 

[Ghost]

Na, thats exactly waht these asset management companies do, buy cheap, add to the product with cheap aqusitions to pad out the brand, then sell at a huge profit.

 

[DarienA]

Na, thats exactly waht these asset management companies do, buy cheap, add to the product with cheap aqusitions to pad out the brand, then sell at a huge profit.

Right, right... I thought about that after I posted... hmmm maybe they were just trying to pad themselves out, look better for a future sale.... <slaps self>

 

[typhonsentra]

$850 million? How the hell could it be worth that much?

 

[thorns]

Yahoo is worth 52B and Google is worth 80B.

850M for IGN isn't THAT much, it would be interesting to see them to go public..

 

[typhonsentra]

Yahoo and Google are household names though. I can't believe that they're more valuable than most of the game developers that they cover.

 

[Any1]

Meh, I don't want to hijack the thread with tiny facts, vague sources, and etc., so I'll just go over the main, conceptual reason:

Who are the people feeding the industry right now? Or, rather, what are they like? They are hyped, they are excited, they are energetic. A customer base like this usually inflates a market past the point at which it can sustain itself. I know an overused example, and an extreme one at that, is the internet boom and bust from a few years back.

Although video games are old to the hardcore gaming community, they are still very much a new and "in" thing to the mass market. I feel as soon as this excitement of the new passes, few people will want to hang around and put in the kind of money gaming requires.

I'm of the oppinion that the opposite is going to happen. I expect gaming to continue to grow. With the next gen coming on gaming is going to become more and more mainstream. I don't think we're anywhere near the ceiling as far as growth is concerned, i epect huge growth over the next 5 years.

 

[Shaheed79]

Yahoo and Google are household names though. I can't believe that they're more valuable than most of the game developers that they cover.

Why not? Developers aren't worth all THAT much, Publishers on the other hand.

 

[Shaheed79]

I'm of the oppinion that the opposite is going to happen. I expect gaming to continue to grow. With the next gen coming on gaming is going to become more and more mainstream. I don't think we're anywhere near the ceiling as far as growth is concerned, i epect huge growth over the next 5 years.

Yeah, I was going to say his reasoning didn't make that much sense to me but I didn't want to derail the topic. If anything leads to the decline of gaming it will be the continually increasing costs and increasing lengths of game development which might inevitably lead to higher and higher game prices and fewer games on the market.

 

[Firest0rm]

Nintendo should buy them.