Sony had it’s earnings call this week and it was reported that there has been another $565 million impairment loss put against Bungie, making the total impairment loss from the $3.6 billion purchase of Bungie now at around $725 million. This is probably largely to do with the fact that both Bungie’s games, Destiny and Marathon, have not been doing very well.
However, it’s important to realise that an impairment loss is not a cash loss, despite what some internet posts, articles and videos are saying. Misinformation is bad these days. An impairment loss is essentially a reassessment of the value of a company. Sony are basically saying that the company they purchased for $3.6 billion dollars is now worth $725 million less. This isn’t a cash loss. It’s a reduction in value. What is does mean is that Sony are still valuing Bungie at well over $2 billion.
Overwhelmingly, online Marathon is being blamed for Bungie’s “losses” when actually Destiny hasn’t been performing either – although one would argue that this has been largely due to a lack of investment in new content for Destiny 2 which has in turn resulted in fewer players. There has not been a content update for Destiny 2 in about 6 months.
Destiny 2 has seen a sharp decline in players since the Edge of Fate expansion and the new systems they have introduced have not been received well. There are a lot of other reasons why Destiny 2 isn’t performing well these days but the fact it’s not performing is the point here.
Interestingly, Destiny 2 wasn’t even mentioned in the Sony earnings call which doesn’t really bode well for Destiny fans. My guess is that this means they already have a plan to wind Destiny down and so didn’t need to mention or discuss it on the earnings call, or they are happy with the plans going forward for the franchise (which we don’t know about yet) and didn’t need to mention it for that reason. Either way, it seems Marathon is now Bungie’s “flagship” game.
During the earnings call it was stated that Sony have “revised their business plans downwards” for Bungie. That is probably not a good thing. At least not for Destiny 2.
In fact, Marathon is seemingly being doubled down on, with good meta critic scores and good reviews on steam (90%+ positive) being mentioned and given as a reason to continue investment in the game. On the call they talked about investment in new content for engaged players, “expansion of the user base” and generally putting a lot more into Marathon and it’s future development.
Marathon has a very small, niche, player base – mostly because it’s a niche game and a niche genre. The art style, the genre itself (hardcore extraction shooter) and the systems which make it a very punishing game (especially when compared with Arc Raiders) have led to a very small audience and therefore very small returns, so far at least.
So, Marathon is a very niche game, but from a quality and system stand point it’s an objectively good game – just not a mass appeal game – and this appears to have been Sony’s and Bungie’s mistake.
Personal opinion – investing in Marathon over Destiny 2 is an insane, out of touch, idiotic decision if that’s the decision that’s being made here.