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Background Information

Midway Games Inc. was an American video game developer and publisher.
Midway was part of the interactive entertainment industry, developing and publishing arcade video games.
Midway's franchises included Pac Man, Pinball, Mortal Kombat, Rampage, Spy Hunter, NBA Jam, Cruis'n, and NFL Blitz.
Midway also acquired the rights to video games that were originally developed by their competitors.
In 2000, Midway was ranked 4^th largest video game selling publisher.
By the end of 2007, Sumner Redstone owned 87% of Midway and by December 2008, he has divested his share and sold it to Mark Thomas.
In February 2009, Midway Games filed for bankruptcy.

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Competitors

Competitors	Products/Games
William Electronics	Slot machines, online gambling, mobile gambling, gaming software/hardware development
Nintendo	Pokemon, Mario Bros, Wii, Gameboy, DS
Valve Corporation	Steam, Portal, Counter Strike, Day of Defeat, Half-Life, Left 4 Dead, Portal, Team Fortress
Rockstar Games	GTA, Max Payne
Sony Gaming	PS Console, PSP, God of War, MotoGP, Gran Turismo
Microsoft Gaming	Xbox, Halo, Age of Empire, Forza, Microsoft Games
Electronic Arts	FIFA, The Sims, Need for Speed

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VRIN and SWOT Analysis

VRIN: Game Characters (Rights)

Strengths

Established brand.
Game Industry Experience
Loyal Customer Base

Weakness

Cash flow
Shifting Management
Newer Products were of Low Quality

Opportunities

Newer game formats (console, PC games)
Online games (e.g. online gambling with Trump Casinos)

Threats

Gaming Consoles
Emergence of cool new characters
Competitors from Indie games

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What issues occured?

The cross-media strategy that the management team came up with failed the company.

Management Team Issues

Management team was not transparent with employees. Zucker was more of a dictator than a leader. The board lost confidence in Zucker.

Problem Statement

The newer adaptation of the legacy games failed to capture the gaming world’s attention because of low quality game production.

Why did the Strategy Fail?

The CEO adopted a platform, Unreal Engine 3, that not everyone agreed on that caused low quality games to be produced.

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Problem Statement

The newer adaptation of the legacy games failed to capture the gaming world’s attention because of low quality game production.

“

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Alternatives

Create a gaming console to compete in the gaming market.
Recapitalize Midway by turning debt into stock value. (Turn Creditors into Shareholders)
Close offices in Germany and France, and centralize resources to a single base of operations in London and penetrate the Japanese market to open a studio.
Create merchandise and accessories by licensing the gaming products.

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Alternatives

Offer a merger with Warner Bros.
Create game sequels and crossovers with other characters.
Host a gaming convention for the game industry in Trump Taj Mahal.
Sell off gaming rights of a few of their popular products to

the highest bidders.

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Recommendations

Place your screenshot here

Recapitalize Midway by turning debt into stock value. (Turn Creditors into Shareholders)
Create merchandise and accessories by licensing the gaming products.
Create new FPS games, game sequels and crossovers with other characters.

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Porter’s Five Forces Model

Bargaining Power of Suppliers - High

Threat of New Entrants - Low

Threat of Substitutes - Low

Competitive Rivalry in an Industry - High

Bargaining Power of Customers - High

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Income Statement

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Balance Sheet - Assets

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Balance Sheet - Liabilities and Shareholders Equity

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Assumptions

We have assumed a rapid company revenue growth and a steady market growth and development within the gaming industry.
We also assume the company will be able to afford R&D expenses to continue production and keep up with the competitive market they are in.

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