Activision CEO: “We Might Have To Stop Supporting Sony”

[I.S.T.]

Yeah definitely WiiHD as well, there's all sorts of interest in Wii in general. But where to get the money from to support it? Hmm...




I chuckle at the "maxed out" comments It's unfortunate that there really is no equivalent to Naughty Dog on the 360, as in there is no dev team extracting every ounce of performance out of it. Alas, 99.9% of 360 development is all effectively treated as multi platform even for 360 only games, so there is nothing out there yet that really cleverly uses the machines hardware advantages.




If COD makes good coin then keep it. They probably have lots of other product they could cut though, and use those resources to make more money elsewhere. They are not interest in making profit, they are interested in making stupidly large amounts of profit. Here's an example on the EA side. EA once bought a company that I worked for. That company was profitable. So EA kept it right? Nope, first thing they did was shut it down. The reason was simple, it made profit but not the profit they were looking for. So *poof*, a whole profitable studio gone with the stroke of a pen. Activision surely has lots of stuff that makes small profit on PS3 that could be considered expendable. There is no reason to drop COD though if it's making them bank.

I take it they bought the company just to shut it down?

 

[obonicus]

Yeah definitely WiiHD as well, there's all sorts of interest in Wii in general. But where to get the money from to support it? Hmm...

Yeah, but Barbarian's remark is a bit strange, there. Would developers really drop 40% of the HD install-base in favor of a console with 0% of the install-base? The Wii's dominance this generation doesn't guarantee the same install-base on the next console. Hell, if anything what the Wii has taught us is that HD may not even matter, particularly to that 'expanded' audience. So we're sorta talking about some strange alternate reality where everything's the same as this gen, but the Wii's HD and is owned by people who want the games 360 owners want. But then I seem to remember Barbarian mentioning he works(ed?) on licensed titles, which makes even more sense -- the PS3's the console with the oldest demographic and probably the one that sells the least licensed stuff.

I chuckle at the "maxed out" comments It's unfortunate that there really is no equivalent to Naughty Dog on the 360, as in there is no dev team extracting every ounce of performance out of it. Alas, 99.9% of 360 development is all effectively treated as multi platform even for 360 only games, so there is nothing out there yet that really cleverly uses the machines hardware advantages.

Right. What matters are the games; if you were going to look at the vast majority of multiplatform games, the PS3 is inferior graphically. The strange thing there is that first-party efforts look so good. Maybe Sony just attracted all the best talent and they're performing miracles, maybe the PS3 really is what Shane Kim says. There's no real difference except to B3Ders and even here people can't figure out which is 'more powerful'. For every, well, you there's a T.B. or nAo.

 

[NRP]

Wouldn't the optimal business strategy be to deliver X360/PS3/WiiHD versions of your game(s)?

Haven't you read what they've said? There isn't sufficient funding for this.

 

[obonicus]

Haven't you read what they've said? There isn't sufficient funding for this.

Actually, he said there's not enough funding to port down to Wii as well. He mentions assets specifically. That wouldn't be a problem for WiiHD... probably. It's sort of odd to talk about WiiHD when we have no idea what it'll be or who Nintendo will be targeting with it. For all we know, fearsomepirate is right and they're keeping the same architecture.

 

[draconian]

The console platform holders handle replication and they require minimum runs.

Can we get more info on this?


I don't believe this. One of the big reasons why 3rd parties left nintendo was because nintendo did all the cartridge replication and required minimum runs.



So, when Sony came with the ps1, all third parties left the big N and joined the Sony.

 

[-tkf-]

Alas, 99.9% of 360 development is all effectively treated as multi platform even for 360 only games, so there is nothing out there yet that really cleverly uses the machines hardware advantages.

Activision surely has lots of stuff that makes small profit on PS3 that could be considered expendable. There is no reason to drop COD though if it's making them bank.

So the 360 is untapped power, funny one, if a PS3 fanboii said the same you would be laughing him up the face

Could you name some of the titles you think they have a small profit on?

 

[inpHilltr8r]

One of the big reasons why 3rd parties left nintendo was because nintendo did all the cartridge replication and required minimum runs.

Cartridge replication cost a lot more than disk replication, and required a lot more lead time making inventory management a nightmare. By comparison, CDs could be pressed up in much smaller batches, with a much faster turn around on repeat orders.

The numbers have changed, but the structures remain the same.

 

[draconian]

Cartridge replication cost a lot more than disk replication, and required a lot more lead time making inventory management a nightmare. By comparison, CDs could be pressed up in much smaller batches, with a much faster turn around on repeat orders.

The numbers have changed, but the structures remain the same.

well, the original person I replied to is right. The royalties are based on amount printed, not sold.

Here are some "sample"(lol, whatever that means) contracts between THQ and sony/ms.
http://contracts.onecle.com/thq/microsoft.lic.2001.03.20.shtml

http://contracts.onecle.com/thq/sony-europe.lic.1998.06.25.shtml

Both these contracts state that the 3rd party pub can only manufacture with an approved disc replication vendor. This of course means both Sony and MS know exactly how many copies are printed.

I'm surprised I could find something like on the web.
But it seems pretty legit.

Also, there seems to be a lot of other interesting info on there. You may want to save the contracts to your hard drive, we don't when these"sample" contracts will be taken down.

===========================
Here is an interesting contract between take 2 and interplay. This contract is in regards to jetfighter and black dahlia.

http://contracts.onecle.com/take2/interplay.distrib.1997.11.13.shtml

It has actual monetary values for stuff on royalties, advances, guarantees, etc...

 

[Squilliam]

Thanks, I have all 3 saved for later. This is really appreciated draconian!

 

[joker454]

I take it they bought the company just to shut it down?

They bought it to get ownership of a certain IP. The profits of the studio were good but not at 'AAA' level, so they nuked the studio.

So the 360 is untapped power, funny one, if a PS3 fanboii said the same you would be laughing him up the face

Your words, not mine. I was only commenting on the "max out" comments that Barbarian mentions and I agree with him, they are ridiculous.

Could you name some of the titles you think they have a small profit on?

No clue I don't work there, but there is always low hanging fruit that only make a pittance of profit in the grand scheme of Activision/Blizzard earning expectations. I could probably google some numbers, but I want to get back to playing Magic The Gathering on XBLive

Yeah, but Barbarian's remark is a bit strange, there. Would developers really drop 40% of the HD install-base in favor of a console with 0% of the install-base? The Wii's dominance this generation doesn't guarantee the same install-base on the next console. Hell, if anything what the Wii has taught us is that HD may not even matter, particularly to that 'expanded' audience. So we're sorta talking about some strange alternate reality where everything's the same as this gen, but the Wii's HD and is owned by people who want the games 360 owners want. But then I seem to remember Barbarian mentioning he works(ed?) on licensed titles, which makes even more sense -- the PS3's the console with the oldest demographic and probably the one that sells the least licensed stuff.

It's all about what a publisher thinks they can make. If they think they can make 20 million doing X, they would considering shifting people away from Y, even if Y generates 5 million. They would not just drop 40% either, I think you guys are looking at this wrong. They won't just suddenly drop PS3, it would never happen that way. They would keep the COD's, etc, that pull in the bulk of the dollars, and shift away smaller stuff slowly but surely. For example, three weeks back I was talking with a friend at a major publisher about a sequel to a known PC title. This sequel isn't out yet, but the PC version is far along and they are looking at console options. The 360 version was a no brainer, but we spent a while talking about why it made no sense for them to bring it to PS3. You'll probably hear about it many months from now, but it's behind the scenes like in that example where the dollars may slowly shift over time. The error people make, and maybe it's because of the sensationalist style of the reporting of all this, is that Activision would overnight drop their ~200 million or so net earnings on PS3 and that's bollux, it would never happen like that.

Or worded another way, just because a company makes 200 million doing something doesn't mean they wouldn't consider shifting it all away over time to something else if they think they could make 500 million elsewhere. No one is saying they will do this, but if they had to then shifting away from PS3 is the obvious choice. The 360's net revenues are really 360+PC because, as much as the PC folk will hate this, the 360 version usually becomes the PC version (although sometimes vice-versa), so the ROI on the 360 version is really 360+PC making those two product lines pure money and hence keepers.

Right. What matters are the games; if you were going to look at the vast majority of multiplatform games, the PS3 is inferior graphically. The strange thing there is that first-party efforts look so good. Maybe Sony just attracted all the best talent and they're performing miracles, maybe the PS3 really is what Shane Kim says. There's no real difference except to B3Ders and even here people can't figure out which is 'more powerful'. For every, well, you there's a T.B. or nAo.

Same as what I said to tkf, I was commenting on the "max out" comment, not sure why you guys bring the PS3 into that.

 

[-tkf-]

No clue I don't work there, but there is always low hanging fruit that only make a pittance of profit in the grand scheme of Activision/Blizzard earning expectations. I could probably google some numbers, but I want to get back to playing Magic The Gathering on XBLive

My point still is that it makes absolutely no sense for activision not to sell it´s game on the PS3.

Let´s just pretend that the profit for the PS3 games is low compared to the 360. Well the PS3 profit isn´t everything since the PS3 sales also carry an important burden on the Content budget. If they didn´t publish a PS3 version the 360 and Wii would have to add that cost into their profit margins.

And then there is the obvious marketing, you hit 3 platforms for the price of one.

If anything all publishers should only release games on the PS3, it´s the only platform where their games can´t be stolen.

 

[sebbbi]

In reality, it's more like a moving target; the publisher finances development, marketing and other costs, and the dev won't get any royalty until the project breaks even.

This is completely true for most of the developers. You get initial payment to complete each project milestone and then royalties if the game sales break the publisher's costs (including marketing). Most of the smaller game projects never break this barrier and do not get any royalties at all.

The bottleneck is not the assets at all. As you say, it's pure labour. In the video game business artists are available by the metric ton and the average wage is very low (compared to the other parts of development). What makes a game break a milestone or not is the programming which is something you can't throw a lot more hands at and expect a significant improvement in efficiency (though you might expect an improvement in risk exposure by having redundant systems - though this is costly).

Assets and design (sounds, music, textures, 3d models, UI graphics, UI design, storyline, concepts, sounds, music, levels, level script, FMVs, etc) have always required considerably over 50% of the work force in our projects. And few dedicated programmers have been working on the asset pipeline code (PC/Linux) all the time. All of this is platform independent work.

If we also cut out all management staff and gameplay testers, the programming is only around 30% of the total work. Most of the program code in a decently programmed game is platform independent. For example only 10% - 15% of the code we run on the target console is platform dependent. But this is only true if the developer has prior knowledge and technology base built on all the target platforms (all big AAA developers do).

I chuckle at the "maxed out" comments It's unfortunate that there really is no equivalent to Naughty Dog on the 360, as in there is no dev team extracting every ounce of performance out of it. Alas, 99.9% of 360 development is all effectively treated as multi platform even for 360 only games, so there is nothing out there yet that really cleverly uses the machines hardware advantages.

Xbox 360 hardware special features are already used in many games. Tricking around with the MSAA hardware and utilizing the EDRAM for maximum bandwidth savings is basic stuff really. Dynamic branching is also pretty easy to use and can yield nice performance improvements if used correctly. However many things possible with memexport are not yet explored, as most developers do not have that many GPGPU specialists allocated to their teams. DX11 compute shaders are going to change this I hope, as we get more and more knowledge about general purpose GPU assisted calculation in the games.

If you are talking about Xbox 360 CPU not maxed out already, I completely agree with you. It requires a lot of work to get in-order CPUs maxed out. Without proper optimization you get horrible IPC out of in-order CPUs. And multithreading is still new to the game developers currently. Maxing out six threads all the time requires lot of designing and load balancing.

 

[Brad Grenz]

Assets and design (sounds, music, textures, 3d models, UI graphics, UI design, storyline, concepts, sounds, music, levels, level script, FMVs, etc) have always required considerably over 50% of the work force in our projects. And few dedicated programmers have been working on the asset pipeline code (PC/Linux) all the time. All of this is platform independent work.

If we also cut out all management staff and gameplay testers, the programming is only around 30% of the total work. Most of the program code in a decently programmed game is platform independent. For example only 10% - 15% of the code we run on the target console is platform dependent. But this is only true if the developer has prior knowledge and technology base built on all the target platforms (all big AAA developers do).

Yeah, so realistically if you actually lost money on the PS3 port there's a pretty good chance your game tanked on every platform. In that sense I agree with Kotick. If you are making a piece of shit it isn't worth the trouble to support the Playstation 3.

 

[sebbbi]

One thing that's not really been yet discussed is the marketing and advertisement cost of a title. Marketing has become a really big part of a title budget. Without properly done marketing titles do not sell well. Basically it doesn't cost any extra marketing budget to advertise a cross platform title. However with a large really hyped up AAA exclusive you are likely to get some cooperation/support from the console manufacturer in the marketing side (as your title advertisements are boosting up the console sales as well).

 

[grandmaster]

So in a sense would "timed exclusives" be a case of having your cake and eating it?

 

[gongo]

Wait here, i thought Barbarian has always been positively open to PS3 CELL development....??? What made the u-turn? Does that make the second developer here changing their feelings, the first was nao (heavenly sword) IIRC. Like seriously, i hope Sony starts giving out their inhouse codes or something..

It's unfortunate that there really is no equivalent to Naughty Dog on the 360, as in there is no dev team extracting every ounce of performance out of it.

I am assuming you are speaking about the phenomenal Uncharted 2? I think it looks gorgeous, but i would like to hear from a developer view about the type of rendering techniques in use. I know they are going for SSAO and realtime blending animations. What else?

 

[liolio]

I'm not sure He will confirm but it would not be the first to change his mind about it, Nao did the same.

 

[the ignoramus]

I chuckle at the "maxed out" comments It's unfortunate that there really is no equivalent to Naughty Dog on the 360, as in there is no dev team extracting every ounce of performance out of it.

Dan Greenawalt would have us believe otherwise.:smile:

 

[obonicus]

It's all about what a publisher thinks they can make. If they think they can make 20 million doing X, they would considering shifting people away from Y, even if Y generates 5 million. They would not just drop 40% either, I think you guys are looking at this wrong. They won't just suddenly drop PS3, it would never happen that way. They would keep the COD's, etc, that pull in the bulk of the dollars, and shift away smaller stuff slowly but surely. For example, three weeks back I was talking with a friend at a major publisher about a sequel to a known PC title. This sequel isn't out yet, but the PC version is far along and they are looking at console options. The 360 version was a no brainer, but we spent a while talking about why it made no sense for them to bring it to PS3. You'll probably hear about it many months from now, but it's behind the scenes like in that example where the dollars may slowly shift over time. The error people make, and maybe it's because of the sensationalist style of the reporting of all this, is that Activision would overnight drop their ~200 million or so net earnings on PS3 and that's bollux, it would never happen like that.

I'm referring to Barbarian's comments, that's what we were talking about. He's not a publisher, but a developer. If he drops the PS3 he drops the PS3, he's not keeping his biggest hits on the PS3 while avoiding it with more niche stuff. And that really doesn't address what I said in the first place: it's odd to put faith in a console you don't know about over one you do, unless you're living in some weird future where the WiiHD is actually the PS3 with better sales.

Or worded another way, just because a company makes 200 million doing something doesn't mean they wouldn't consider shifting it all away over time to something else if they think they could make 500 million elsewhere. No one is saying they will do this, but if they had to then shifting away from PS3 is the obvious choice. The 360's net revenues are really 360+PC because, as much as the PC folk will hate this, the 360 version usually becomes the PC version (although sometimes vice-versa), so the ROI on the 360 version is really 360+PC making those two product lines pure money and hence keepers.

Have you been reading the thread? I've already mentioned ROI, I've admitted that making money on the PS3 means nothing, though it might for Activision -- as I've also said twice in this thread, they're risk-averse. My point is as above: you're talking about the WiiHD as if the WiiHD were some holy grail, the PS2 of the HD generation and it's a strange thing to do. Because the WiiHD doesn't exist in any way other than on forums.

The problem with eliminating the PS3 is the size of the market. HD's a smaller market than the Wii market, but more expensive to make games for. If you drop the PS3 on these games, you lose 35-40% of the install-base, in which 50% of the effort (according to assurdum) goes into making assets. And no, I have problems believing that PC is a substitute. As Brad Wardell reminds us, the PC was never home to a blockbuster audience and is better served by games targeted at an older audience. If we're strictly speaking of ROI, then we could just as easily say that it's safer for Activision to start targetting the Wii for all its games and simply upscale assets for the 360/PS3. As you've pointed out, this would of course exclude CoD from this, as the HD version makes more money than the Wii one. But probably not GH.

Same as what I said to tkf, I was commenting on the "max out" comment, not sure why you guys bring the PS3 into that.

Uh... you do know you brought up Naughty Dog, right? They program for the PS3?

 

[upnorthsox]

Uh... you do know you brought up Naughty Dog, right? They program for the PS3?

And in doing so he implied with a backhanded complement that the PS3 has been maxed out (or more acurately, had every last ounce extracted out of it) while the x360 is anything but.