Xbox Boss Sold Stock Before MS Came Clean on Red Ring Fiasco
Xbox Boss Sold Stock Before MS Came Clean on Red Ring Fiasco
July 13, 2007
We've written much about the Xbox 360's disgraceful hardware failures of late.But a story getting even more press right now concerns Microsoft exec Robbie Bach and his sale of $6.2 million worth of MS stock prior to company revelations about the extent of the so-called "red ring of death."
As reported by MarketWatch, SEC records show that the stock was sold between May 2nd and last week's announcement that MS was extending the 360 warranty to three years for the red rings failure. The news had little impact on the company's share price.
A Microsoft spokesman said:
Robbie Bach's past trading is completely unrelated to last week's announcement. ... [He] continues to hold a significant stake in Microsoft and remains confident in the long-term success of the company.
MarketWatch quotes Ben Silverman of Indie Research, a firm that tracks insider sales:
"It doesn't necessarily mean [insiders] think that there will be a bad event; it could just be financial planning. But sometimes it just looks bad that an insider has sold stock. I'd give [Bach] the benefit of the doubt here, especially because the stock didn't move very much."
A PUBLICATION OF THE ECA
SUBSCRIBE
LOGINGamePolitics ShoutBox
Posted 11/07/09 at 04:27pm
ZippyDSMlee: man I got alot of junk and dup files too >< god I need orginization...and no not the knee capping media mafia kind :P
ZippyDSMlee: man I got alot of junk and dup files too >< god I need orginization...and no not the knee capping media mafia kind :P
Posted 11/07/09 at 04:26pm
ZippyDSMlee: replaced :P
ZippyDSMlee: replaced :P
Posted 11/07/09 at 04:23pm
ZippyDSMlee: beemoh:hey its like 60GB porn,400GB anime 100GB games and crap I have took from all my DVDs, I hate waiting on dvds to install stuff..... oh and 40GB of my porn was in the found.000 folder...mostly corrupted.... least I got names of wut needs to be repa
ZippyDSMlee: beemoh:hey its like 60GB porn,400GB anime 100GB games and crap I have took from all my DVDs, I hate waiting on dvds to install stuff..... oh and 40GB of my porn was in the found.000 folder...mostly corrupted.... least I got names of wut needs to be repa
Posted 11/07/09 at 04:18pm
beemoh: @Zip: ...and you'd have to spend all that time re-downloading that porn?
beemoh: @Zip: ...and you'd have to spend all that time re-downloading that porn?
Posted 11/07/09 at 03:34pm
ZippyDSMlee: ggrrrrr......vista lost one of my hard drives and I had a heart attack thinking I lost 1TB of data....
ZippyDSMlee: ggrrrrr......vista lost one of my hard drives and I had a heart attack thinking I lost 1TB of data....
Posted 11/07/09 at 10:58am
JDKJ: Which could be explained by both (a) and (b).
JDKJ: Which could be explained by both (a) and (b).
Posted 11/07/09 at 10:56am
Austin_Lewis: JDKJ: You forgot C) the fact that, for some reason, every time he did something that would suggest he shouldn't be in the military, let alone an officer, higher ups ignored it or let it slide.
Austin_Lewis: JDKJ: You forgot C) the fact that, for some reason, every time he did something that would suggest he shouldn't be in the military, let alone an officer, higher ups ignored it or let it slide.
Posted 11/07/09 at 10:51am
JDKJ: Part of the problem is, I believe, that (a) the Army had a lot of time and money already invested in him and which they were unwilling to simply write-off and (b) an increasing need for the type of skills and services he provided.
JDKJ: Part of the problem is, I believe, that (a) the Army had a lot of time and money already invested in him and which they were unwilling to simply write-off and (b) an increasing need for the type of skills and services he provided.
Posted 11/07/09 at 10:48am
JDKJ: And that even if he was begging not to get cut loose, he was apparently a real good candidate for being cut loose, anyway.
JDKJ: And that even if he was begging not to get cut loose, he was apparently a real good candidate for being cut loose, anyway.
Posted 11/07/09 at 10:11am
JDKJ: @chada: And while Kennedy once noted that there's usually more than enough blame for everyone to get a slice, the possibility that the Army was unwilling to cut loose someone who was asking to get cut loose could be a factor.
JDKJ: @chada: And while Kennedy once noted that there's usually more than enough blame for everyone to get a slice, the possibility that the Army was unwilling to cut loose someone who was asking to get cut loose could be a factor.
Posted 11/07/09 at 10:07am
ZippyDSMlee: *noms on his feet*..nomnomnomnom*droooll* ...wuuutttttt uuu looking at?
ZippyDSMlee: *noms on his feet*..nomnomnomnom*droooll* ...wuuutttttt uuu looking at?
Posted 11/07/09 at 10:05am
JDKJ: I'm no psychologist, but I'm told that crazy people have a tendency to do crazy things.
JDKJ: I'm no psychologist, but I'm told that crazy people have a tendency to do crazy things.
Posted 11/07/09 at 10:03am
chadachada321: Whoops, was out of the convo for awhile. I do wonder what type of ammo he used etc, but the real issue is WHY he did it, not HOW
chadachada321: Whoops, was out of the convo for awhile. I do wonder what type of ammo he used etc, but the real issue is WHY he did it, not HOW
Posted 11/07/09 at 09:56am
JDKJ: But if it turns out that they actually did, they'll have Hell to pay.
JDKJ: But if it turns out that they actually did, they'll have Hell to pay.
Posted 11/07/09 at 09:45am
JDKJ: And I'd tend to rule out the possibilty of FN Herstal supplying restricted ammunition to someone merely because they're ordering it from a military base.
JDKJ: And I'd tend to rule out the possibilty of FN Herstal supplying restricted ammunition to someone merely because they're ordering it from a military base.
Posted 11/07/09 at 09:37am
JDKJ: I know you don't leave your gated community and get around much in dark alleys, so you may be surprised to learn that there's this thing called "the black market" where, if you've got enough money, ain't too much of anything which can't be bought.
JDKJ: I know you don't leave your gated community and get around much in dark alleys, so you may be surprised to learn that there's this thing called "the black market" where, if you've got enough money, ain't too much of anything which can't be bought.
Posted 11/07/09 at 09:36am
Austin_Lewis: Or, maybe he or someone else at the base ordered the SS190 from FN Herstal.
Austin_Lewis: Or, maybe he or someone else at the base ordered the SS190 from FN Herstal.
Posted 11/07/09 at 09:32am
Austin_Lewis: the hands of private owners. They run about 300 dollars minimum for a box of 50, and boxes of AP 5.7 are extremely scarce, mainly residing in the hands of Class III stores or individuals who for one reason or another got a demo box of it.
Austin_Lewis: the hands of private owners. They run about 300 dollars minimum for a box of 50, and boxes of AP 5.7 are extremely scarce, mainly residing in the hands of Class III stores or individuals who for one reason or another got a demo box of it.
Posted 11/07/09 at 09:30am
Austin_Lewis: There are other firearms that fire the 5.7. However, I too would like to know where he got the ammo and what kind was used. Maybe Hasan, planning not to live through this, went out and bought one the boxes of SS190 that are floating around in
Austin_Lewis: There are other firearms that fire the 5.7. However, I too would like to know where he got the ammo and what kind was used. Maybe Hasan, planning not to live through this, went out and bought one the boxes of SS190 that are floating around in
Posted 11/07/09 at 08:44am
JDKJ: And it isn't yet clear what type of ammunition Hasan used. It's strange that he purchased a gun but didn't purchase ammunition for it at the same place and time. Especially because the calibre required is peculiar to the actual gun.
JDKJ: And it isn't yet clear what type of ammunition Hasan used. It's strange that he purchased a gun but didn't purchase ammunition for it at the same place and time. Especially because the calibre required is peculiar to the actual gun.
Copyright © 2007 ECA. All rights reserved.
Game Politics and Game Politics logo are trademarks of the ECA.
Game Politics and Game Politics logo are trademarks of the ECA.
Comments
I am also guessing he has a fairly diversified portfolio.
I'm also guessing that the xbox division is such a tiny part of MS that the stock price isn't a concern.
As mentioned above, great so correlation = causation when we want it to?
But it is also possible that he saw a nice profit in his investment at that time and made the sale. Then later made the announcement.
It just requires an investigation and if he is guilty he will go to jail. If not he will be slapped on the wrist and sent away.
So now it's okay to use correlation=causation logic and coporate conspiracy theories in the absense of hard evidence when it suits your arguments, huh? Good to know all the crap we take from anti-gamers who use the same rhetorical traps hasn't gone unoticed. Kudos to you for taking the logical high road.
It depends on how he got those shares as to how much he walked away with from the transaction. MS awards stock as incentives to employees. Those could have been "options" given as a hiring incentive, meaning that the Robbie had to pay for the stock at the award price and then take only the difference as profit (and wait as much as five years for his ownership in the stock to vest). They could have been accumulated through an employee purchase program where he was paying a reduced price for the stock all along. Or they could have been incentive awards, which means he was given the stock as a bonus reward for service to the company. And the way all those stock incentives and employye stock sales work ... you can bet on it that he paid his tax on them all the appropriate times (award or sale), so it's not like he was scamming anyone in that regard.
http://en.wikipedia.org/wiki/Martha_Stewart_Insider_Trading_Charges
@~the1jeffy - Excellent point... Usually you dump your stock because something really *bad* is going to happen. Nothing really bad happened, so it's very possible they were unrelated. However, that doesn't mean we shouldn't investigate...but hey, maybe we'll find out that he needed the cash for a down payment on one of those Russian space trips. =)
http://en.wikipedia.org/wiki/Enron_Scandal
Despite games being our big issue here, it's a relatively small group in terms of people and income for Microsoft.
MS stock was the highest it's been in quite some time during that time period. Company officers and employees at all levels and in all groups were selling large chunks of stock to cash in on vested stock awared shares that were finally far enough above their strike prices to be worth selling. The stock peaked briefly then went down again and has been see sawing up and down about a buck and a half a share.
Even if he sold right now AFTER the announcement, Robbie would still make close to what he made selling his stock before the announcement. MS stock did not go in the toilet over some negative press (as was the case with Take Two a while back).
@G-Dog:
At least you'd have $6.2M to keep you company.
The popularity of the Xbox, as well as its relatively short 90 day warranty, inspired efforts to circumvent the built-in hardware and software security mechanisms, a practice informally known as modding.
water softener systems