5 ms·
Ran some math with friends. Minecraft is from 2009, so it's 5 years old. https://minecraft.net/stats https://minecraft.net/stats says it's sold ~16M pc and mac
by mindstab 12y ago
Ran some math with friends. Minecraft is from 2009, so it's 5 years old. https://minecraft.net/stats https://minecraft.net/stats says it's sold ~16M pc and mac copies and the front page says at $27. That's about $432M in its entire life [assuming everyone paid full price, which they didn't, there have been loads of deals over the years]. Now that doesn't take into account mobile and console. For android the $7 pocket version is reporting 5M which is $35M. I don't have numbers for iOS and console but I can't really imagine they come close to PC and Mac. And as my friend reminded "Well I'm one if those 5m and I paid $0.10 [for the android version]"
I have a hard time understanding where they get the $2.5B valuation considering its revenues. Another friend thought advertising: " heck, even brand recognition - if they put "Microsoft Minecraft" on the title, I'm sure that's comparable to a few superbowl ads &tc"
So we ran that math.
"the average cost of a 30-second advertisement was around $4 million" - wikipedia [ https://en.wikipedia.org/wiki/Super_Bowl_advertising https://en.wikipedia.org/wiki/Super_Bowl_advertising ] "Super Bowl XLV, played in 2011, became the most-watched American television program in history with an average audience of 111 million viewers " - wikipedia. 16.7M people have bought minecraft [mincraft.com/stats pc and mac] + 5M for android. That's still a fraction of a super bowl ad (like 16%) or ~$670,000 value in super bowl advertising terms. Except I suspect anyone actually in advertising would say the value of a finely crafted 30 second video advert massively beats your company name under a game title.
Regardless of quibbles, the advertising potential seems off by many orders of magnitude. also as was mentioned: "Is brand recognition something ms has a problem with?"
So where is the $2.5B coming from? Especially when the gamesutra article [ http://www.gamasutra.com/view/news/225611/Minecraft_studio_Mojang_has_been_bought_by_Microsoft_for_25B.php http://www.gamasutra.com/view/news/225611/Minecraft_studio_M... ] has them saying they think they can recoup the full value in 1 year!
- pohl 12y agoI don't have a complete answer, but the other day I popped into a local Target and was surprised to see Minecraft-themed clothing (shirts, hats) and toys (foam pixel-swords). Maybe the merchandising deals are a big piece?
- givehimagun 12y agoDon't forget the merchandising rights: toys, Lego Minecraft, costumes, school supplies, books, etc. http://shop.lego.com/en-US/Minecraft-21102 http://shop.lego.com/en-US/Minecraft-21102
- JacobAldridge 12y agoMojang reported profits last financial year of $128 million (approx, allowing for conversion rates to USD). Microsoft is trading today on a P/E multiple of 17.6. That means, in super simplistic terms, that $128 million in extra profit increases Microsoft's market capitalisation by ($128 x 17.6 =) $2.2528 Billion. Given those profit figures are 6 months old, and the negotiating team would have access to current data, $2.5B is about on the money. Recoup full value != recoup the $2.5B in profit.