Activision Blizzard, Riot Games, GameStop, and Nintendo. Four separate entities that might seem like good investments for those interested in putting their money in the entertainment industry. Each offers a different kind of safety and volatility, as well as philosophy for different kinds of traders. Let’s go over each one and briefly cover some of the fundamental commitments an investor makes when buying stake in the respective companies.
Activision / Blizzard
This listing might be a bit confusing to those familiar with both companies, but yes, Activision and Blizzard did merge their two parent companies, and have been listed publicly under ATVI since 2008. The company is responsible for overseeing such titles as the famous Call of Duty franchise, World of Warcraft (and all Warcraft games), and Hearthstone, to name a few. Additionally, they function as a publishing company, putting their hands on titles like Sekiro: Shadow’s Die Twice, without directly developing them.
In short, this company is in control of some of the more influential titles in the gaming world today. Additionally, they have the talent and name recognition to put some stake into projects they otherwise wouldn’t have been able to. If you’re looking to invest in a safe, long term appreciating asset, ATVI might be for you.
Though, its worth looking at some of the company’s cons before throwing any money at them, obviously. There are many to name, not least of which being that the company’s evaluation is directly tied to the performance of their games. And while it may seem that the most popular, best selling franchises and titles are nothing to be afraid of when putting money somewhere, you have to consider the fact that both Call of Duty and World of Warcraft are two games that have been under heavy scrutiny the past few years. And I don’t mean light scrutiny.
The last Call of Duty game to make the top 10 list for best selling COD games (there are 24 of them, now.) was back in 2017. The latest installment, Cold War, has been cited as an overall disappointment that only feeds into speculation about the franchise running out of steam.
As for WoW, the game only a year ago was in dire straights. Players of the retail version could only talk about broken, unfun, and “RNG-ridden” the game was. Players of the classic variant were more or less just bored. Now, only a year later, with Shadowlands released, things are looking a bit brighter for that community, and the game is receiving much better feedback, if temporarily.
And all this to say that, good or bad, things can change very quickly in the video game industry. If you don’t know about the culture of the community you’re investing in, it might be wise to dip into their ranks and see for yourself clean the house is. Even though the product’s track record might seem pretty, the very fans who use it might tell you the future is not so hot.
Developers of the biggest eSport game in the world and future media conglomerate overlords (pure speculation), Riot Games is undoubtedly the most talented and culturally influential development team in gaming today. The team has, as aforementioned, created League of Legends, which dominates the eSports scene with hundreds of thousands of viewers every week, and millions more during their famous Worlds event.
Additionally, they are putting out a handful of extra pieces of media in attempts grow their influence; A Counter-Strike competitor in VALORANT, an animated series Arcane that tells the story of a number of characters featured in League, a TCG rivaling Hearthstone in ways I never expected in the form of Legends of Runterra, and an MMO that I am trying my best to pretend like I’m not really all that interested in and failing miserably.
All sounds good, right? Well, here’s the deal. You can only invest in Riot indirectly. As it happens, all of their shares are traded privately, and the entity that owns a majority of those shares is Tencent. So if you want to bet on Riot, and you’re not running around with $500 million to do it, you’re best bet is throwing money at Tencent. Funnily enough (or not), Tencent has a large stake in a lot of companies (a LOT of companies), including our friends up above, Activision. You’ll have the wrestle with the morality of investing in a company that has had a lot of questions about its usage of user data thrown in its face, but I’m not here to tell you what’s right or wrong, I’m here to tell you what’s a sound investment, and barring any ban on your respective country allowing for trade of this stock, Tencent is pretty much as sound of an investment as you can make, and it even comes with a little dividend payment as a cherry on top.
I’ll be brief about our last two companies. Nintendo is a studio that produces good games. That’s about it. Its games aren’t eSports dominating, they don’t pull in massive sales like COD, and they don’t tend to have much in the way of obnoxious monetization (lootboxes, time gates, etc). But they have good games, they have solid licenses, their own consoles, and a community that loves what they do (at least most of the time).
If you don’t know anything about games, but want to have some investments in them, you really can’t go wrong with Nintendo. A small dividend to reward long-term holders, a solid foundation for a company to flourish for the next 50 years, and the love of the common folk. Easy.
It’s a bigger meme than an actual business at this point, and I want to take a moment to talk about it.
GameStop doesn’t, currently, reflect a sound investment. I’d wager at 10 dollars a share, this stock isn’t a worthy of your time, and at the moment of me writing this, the stock is sitting at a rough $180 due to the hype, misguided information, and hilarious short-squeeze the blokes at WSB are still pulling.
This is the kind of example I’d like people outside the gaming world to look at when they want to see, for themselves, the evolution of the gaming market. Today, that evolution is a world where physical games (i.e. disks) are becoming more and more obsolete. I’d wager in the next decade, physical game copies will be a phenomena limited to a small percentage of console gamers, and non-existent on the PC, as they almost already are.
Unless GameStop starts changing its business model to something revolutionary, or you just like the dream that is going to the moon, stay away from this one. It’s 0% reasonable assessment on the side of GameStop and 100% speculation and memes.