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Activision Buys Itself Back from Parent for $8.17 Billion

posted Saturday Jul 27, 2013 by Scott Ertz

Activision Buys Itself Back from Parent for $8.17 Billion

Let's file this one under weird business relationships. Vivendi, the majority stake owner of Activision, made a request of the game publisher for a $3 billion dividend. Bobby Kotick, CEO of Activision, and Brian Kelly, co-chairman, decided that this was an unreasonable request and, instead, decided to purchase majority stake back from Vivendi.

$5.83 billion worth of stock will be purchased by Activision itself. $1.2 billion of that will come from on-hand cash reserves, with the remaining being borrowed from Bank of America and JP Morgan Chase. In addition to the stock buyback from Activision, an investment group led by Kotick and Kelly will purchase another $2.34 billion worth of stock, $100 million of which belonging to the two executives. Vivendi will retain the remainder of their stock holdings, amounting to 12%, versus the previous 60%.

Kotick said of the move,

These transactions together represent a tremendous opportunity for Activision Blizzard and all its shareholders, including Vivendi. We should emerge even stronger - an independent company with a best-in-class franchise portfolio and the focus and flexibility to drive long-term shareholder value and expand our leadership position as one of the world's most important entertainment companies...

The transactions announced today will allow us to take advantage of attractive financing markets while still retaining more than $3 billion cash on hand to preserve financial stability. Our successful combination with Blizzard Entertainment five years ago brought together some of the best creative and business talent in the industry and some of the most beloved entertainment franchises in the world, including Call of Duty and World of Warcraft. Since that time, we have generated over $5.4 billion in operating cash flow and returned more than $4 billion of that to shareholders via buybacks and dividends. We are grateful for Vivendi's partnership through this period, and we look forward to their continued support.

This is definitely a huge move for the company, but it could also be a scary decision. Activision is known for milking its franchises until they catch fire, and there is no telling whether Vivendi was involved in this decision at all, or for the better or worse. There is always the possibility that, in the end, their franchises will be even more affected in the future.

Activision's management believes that their earnings per share will increase as much as 30%, indicating that they believe significantly higher profitability without Vivendi. I am going to believe that this indicates they think they can release more unique games that people actually want to play as opposed to minor iterations on existing titles. Activision: prove me right.

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Apple Developer Website Hacked This Week

posted Sunday Jul 21, 2013 by Nicholas DiMeo

Apple Developer Website Hacked This Week

Any developers, specifically Apple developers, were stumped this week as to why they may have had problems accessing the Apple developer website. For those affected, an email should have just reached your inbox explaining what happened. Apple said that email addresses, names and even actual addresses might have been compromised in an apparent website hacking.

Here's the official word from Apple,

Last Thursday, an intruder attempted to secure personal information of our registered developers from our developer website. Sensitive personal information was encrypted and cannot be accessed, however, we have not been able to rule out the possibility that some developers' names, mailing addresses, and/or email addresses may have been accessed. In the spirit of transparency, we want to inform you of the issue. We took the site down immediately on Thursday and have been working around the clock since then.

In order to prevent a security threat like this from happening again, we're completely overhauling our developer systems, updating our server software, and rebuilding our entire database. We apologize for the significant inconvenience that our downtime has caused you and we expect to have the developer website up again soon.

A spokesperson from Apple noted that the dev site is not "associated with any customer information" and that any "customer information is securely encrypted." We also know that Apple is extending memberships due to the outage and that any software that was published would not be removed.

Now, as this email was just released, we'll obviously have more details in the near future as to what happened, but for now take precaution and change some passwords, just to be safe. I guess this finally and officially disproves the whole "Macs don't have vulnerabilities" thing, even if a report has already proven it.

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Court Denies CBS Request to Rehear Aereo Case

posted Sunday Jul 21, 2013 by Nicholas DiMeo

Court Denies CBS Request to Rehear Aereo Case

Even after the courts ruled in favor of Aereo in the appeal hearing, CBS still wasn't happy about it. In fact, the broadcasting company filed a complaint against Aereo for winning the appeal, in which Aereo responded by filing a complaint against CBS for complaining. Despite the nonsense, the case is still ongoing due to CBS' relentless effort to cling onto their old ways. This week, however, Barry Diller and Aereo scored another victory.

The US Court of Appeals for the Second Circuit flat-out refused CBS and Disney's request to rehear the entire case again, but this time in front of a full panel of judges. Here's how it went down: apparently, judges can be polled on if they wish to rehear a trial and, if the majority of judges do not wish to participate, the court will not hear the case again. That's a pretty cut-and-dry way of handling a re-appeal.

Everything isn't perfect, though, as Judge Denny Chin decided to issue a 30-page dissent on the matter, in which he wrote that Aereo is actually a "sham" and the company is a menace to the entire broadcast space. This adds to his previous negative remarks toward the company back in April. In this report, he said,

Indeed, the hardware and technology in Cablevision and the antennas and wiring at issue here are fast becoming obsolete in this era of the "Cloud" and wireless technology. Courts should follow Congress's lead and resist the urge to look "under the hood" at how these processes technically work.

The company is also fighting legal battles in Massachusetts, Virginia and soon Atlanta. The good news is that the case has not reached the Supreme Court and it won't. What that means is Aereo will be legal in each state it wins a potential case in. Ironically enough, the company has yet to bring up the Slingbox being legal, but it appears they're saving their heavy artillery for the later battles.

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VLC Returns to Apple App Store

posted Sunday Jul 21, 2013 by Scott Ertz

VLC Returns to Apple App Store

It has been more than 2 years since VideoLAN had its VLC media player yanked from Apple's App Store. The app was originally removed because, like all of VideoLAN's code, it is released open-source. The code, released under the GPL license, conflicted with App Store rules because of the rules of the license.

The new version, now a round 2.0, is being released under 2 different licenses: Mozilla Public License Version 2 in addition to the GNU General Public License Version 2 or later. Obviously, missing from the list is the GPL; clearly an attempt to prevent the same issue from popping up again.

It isn't that VLC was impossible for the past 2+ years, as any jailbroken iOS device could run the app side-loaded. Availability in the store, however, means that those who are unwilling or unable to unlock their devices will be able to play files, like MKV, on their iOS devices.

For better or worse, the re-entry into the store is a win for open source projects in the Apple ecosystem. Perhaps other projects, whose apps have been removed because of the GPL license, will be able to re-apply by releasing under other open-source licenses. It might also encourage GPL to reexamine their licensing, or offer a mobile version of the license terms.

The app, of course offered for free, is available in the store right now. If you've got an iOS device and download the app, let us know how you like it in the comments below.

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Batman and Superman to Unite On-Screen

posted Sunday Jul 21, 2013 by Scott Ertz

Batman and Superman to Unite On-Screen

It has finally happened - The Caped Crusader and The Man of Steel will be coming together on the big screen for the first time. Henry Cavill, the most recent Superman from this summer's Man of Steel will reprise his roll, along with Amy Adams, Laurence Fishburne and Diane Lane.

Christian Bale, who has headlined the last 3 Dark Knight films, will not return to the Kevlar suit, nor will Christopher Nolan be directing another film in the franchise, though he will serve as an executive producer on the hybrid film. This definitely means that the film is a sequel to the current Superman franchise and will not live within our now defunct Batman universe.

In addition to Batman and Superman meeting on-screen, we will also see a film starring the Flash, and, assuming commercial success of these films, we will see a DC Universe meetup in a Justice League film. No announcement was made about future Batman titles, but that might have to do with the fact they have not announced any casting for Batman in this new film.

Obviously, this news comes in response to the Marvel Movie Universe's massive success. With films starring Iron Man, Spider-Man, Thor, Captain America, Wolverine and their own meetup, The Avengers, constantly succeeding in theatres, it was only a matter of time before DC tried to get in on the cash train.

During the announcement, Harry Lennix, who played DC's Nick Fury, read a selection from The Dark Knight Returns, the book from Frank Miller.

I want you to remember, Clark. In all the years to come. In all your most private moments. I want you to remember my hand at your throat. I want you to remember the one man who beat you.

This means that the film will be less team-up and more beat-down. The rivalry between these two heroes is legendary and makes for a more tense Justice League, whether or not they resolve their differences before the possible film. It would be even more intense than The Avengers had Edward Norton remained as Hulk.

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NCAA Ends Relationship with Electronic Arts

posted Sunday Jul 21, 2013 by Scott Ertz

NCAA Ends Relationship with Electronic Arts

In the least shocking EA news of the year, the National Collegiate Athletic Association (NCAA) has decided that it will not renew its licensing contract with EA Sports. This means that we will not see an NCAA Football 15 coming from the publisher. This news comes after a group of current and former college athletes sued the NCAA for profiting from their likenesses without providing any compensation to those athletes.

We are confident in our legal position regarding the use of our trademarks in video games. But given the current business climate and costs of litigation, we determined participating in this game is not in the best interests of the NCAA.

Now, to be fair to the NCAA, they are not responsible for licensing the likeness of college athletes. In fact, the licensing of teams and information is done through an organization called the Collegiate Licensing Company (CLC). The licensing between EA and NCAA merely allowed EA Sports to use the name and logo on the box and in the title of the game, not to use the names of any of the schools or players in the game.

EA and the CLC have confirmed that they will continue to work together after the NCAA license expires for future college football titles. Andrew Wilson, EVP for EA Sports, wrote,

EA Sports will continue to develop and publish college football games, but we will no longer include the NCAA names and marks. Our relationship with the Collegiate Licensing Company is strong and we are already working on a new game for next generation consoles which will launch next year and feature the college teams, leagues and all the innovation fans expect from EA Sports.

So, this means that the only change in the franchise will be the title of the game, from NCAA Football 15 to something like College Football 15. Not exactly a win for the athletes involved in the litigation, but not a loss either, but it won't make it any easier to win. In the current setup, the NCAA was taking money from EA Sports for a game featuring athletes that the NCAA says cannot receive any money for. Now, with the NCAA no longer involved with the title, arguing that there is impropriety in the system will not be easy.

It does make sense, though, for the NCAA to get out of the business, at least for now, while they sort out the legal implications. The cost of litigation is potentially HUGE, both financially and in brand value. Any chance to avoid such cost is worth it to the organization.

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