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

. Also, how many of their PS3 games actually sell 500k+? Anyone have some numbers?

Sales don't seem to match up with what npd reports and with what 3rd parties report.


here is a breakdown of revenue by platform
----------------------------------------------------

capcom 2008/2009 (shipment in thousands)
ps3 1750/4450
xbox360 1620/4300

activision net revenue(in millions) for 2008
ps3 241 (8%)
xbox360 361 (12%)

sega sammy FY2009 Results
PS3 21skus 3,130,000
Xbox360 16skus 2,120,000

take two (six month revenue ending april 2008/2009)
ps3 32%/13%
xbox360 41%/32%

bandai-namco FY2009
ps3 3,273,000
xbox360 2,704,000

EA FY2009
ps3 776
xbox360 1005

ubisoft revenue for 2007-2008
ps3 20%
xbox360 26%

Looking at the above, one can see that for the most part the sales on the ps3 and the xbox360 are pretty much same(or at least inline with the install base). Is europe where ps3 games sell well? Maybe ps3 users have a more variety in their purchasing habits? Maybe this is why ps3 games don't show in the top 10 npds and ps3 games sales may be more evenly distributed for everything below the top 10. who knows?
 
Activision_Revenue.jpg



As you can see the PS3's net revenue is about 2/3 of the 360, which is pretty much in proportion to the hardware install base.

And let's take Sebbbi's estimate into account, say 30% of the production budget is going into the programming, and about 10-15% of the code is specifc to console A. That' about 3~4.5% of the total production cost. Even if the PS3 specific code costs like 20 times more acounting 60% increase in total production cost, the ROI ratio is still the same as making the game for the 360 only.

Saying the PS3's ROI is less than the 360 is just plain stupid.
 
Thank you guys for those very informative posts.

It is as Activision's over paid CEO is just playing politics as usual to please some possible profit from a price drop that won't happen and if it does will not be as significant unless they address the real cause of their losses when games buying public gets used to the idea of waiting for the pre-owned copy specially because gamestop gives them a discount.
 
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.
I find this comment to be just as silly as those that say the platform is "maxed out". It's best not to speculate on silly things like this.
 
Activision_Revenue.jpg



As you can see the PS3's net revenue is about 2/3 of the 360, which is pretty much in proportion to the hardware install base.

And let's take Sebbbi's estimate into account, say 30% of the production budget is going into the programming, and about 10-15% of the code is specifc to console A. That' about 3~4.5% of the total production cost. Even if the PS3 specific code costs like 20 times more acounting 60% increase in total production cost, the ROI ratio is still the same as making the game for the 360 only.

Saying the PS3's ROI is less than the 360 is just plain stupid.

The 360 number will be treated as 360 + PC, since when you make the 360 version, you basically get the PC version. That's one of the reasons the 360 versions of games have better ROI. But it's not just ROI that needs to be looked at. Is there a breakdown of that PS3 number? As in how much of that 241 is COD, etc... Activision makes lots of stuff, I can't imagine the PS3 versions of all their titles each pull in 50+ million. There's bound to be titles < 10 million in there.


I find this comment to be just as silly as those that say the platform is "maxed out". It's best not to speculate on silly things like this.

Nah that one is very easy to deduce. Go to trade shows, talk to friends, fill in the blanks.
 
Well like I said I don't think PS3 would be out right dropped, but having lesser sellers cut is in the realm of possibility to me. There's been a contraction of sorts lately, the game industry has slowed down hiring dramatically (there's lots of out of work game coders now), and companies are looking to make more from what they have.
You're not making sense. Even with lesser sellers, the effort needed to port a 360 game can't possibly approach 2/3 that of the total development cost, yet that is pretty much how much Activision's sales will increase by doing so, assuming a game breaks even or better (and that's obviously the assumption at the outset).

In times of contraction it's even more senseless to avoid PS3 ports. If you want to do more with what you've got, then why on earth would you ignore a chance to release a game on the PS3 when 80% of the work is already done? New games simply cannot compete with ports in terms of ROI. Yeah, maybe Activision could make a $150M with a new game, or maybe they'll flop and lose $10M. There's no reason to think that lost opportunities would, on average, fare any better than the games they did choose to develop, and it's virtually impossible for a PS3 port to have lower ROI than the 360 exclusive it's based on.

I love reading your posts, joker454, but you're dead wrong here. PS3 would have to be obscenely difficult to develop for if your logic is to have any merit, and I just don't buy it.
 
The 360 number will be treated as 360 + PC, since when you make the 360 version, you basically get the PC version.

Pardon my ignorance, but can you really get the PC version for free, without having to rewrite code? What was all that about console programmers programming to the metal, even on current consoles?
 
You're not making sense. Even with lesser sellers, the effort needed to port a 360 game can't possibly approach 2/3 that of the total development cost, yet that is pretty much how much Activision's sales will increase by doing so, assuming a game breaks even or better (and that's obviously the assumption at the outset).

In times of contraction it's even more senseless to avoid PS3 ports. If you want to do more with what you've got, then why on earth would you ignore a chance to release a game on the PS3 when 80% of the work is already done? New games simply cannot compete with ports in terms of ROI. Yeah, maybe Activision could make a $150M with a new game, or maybe they'll flop and lose $10M. There's no reason to think that lost opportunities would, on average, fare any better than the games they did choose to develop, and it's virtually impossible for a PS3 port to have lower ROI than the 360 exclusive it's based on.

I love reading your posts, joker454, but you're dead wrong here. PS3 would have to be obscenely difficult to develop for if your logic is to have any merit, and I just don't buy it.

I figure it this way, a cheap PS3 port may cost about as much as making a regular Wii game (it actually probably costs more to do the PS3 port, but lets just say it's the same for the sake of argument), and it definitely costs more than porting some 360 games to the Wii which I've seen done by as little as two people. So even if 80% of the work is already done, I don't know if it's worth more to keep chasing small but predictable PS3 port sales numbers (just talking about the low sellers here) instead of using it to get a better foothold in the Wii world. I'm all for multi platform, I've always thought it makes the most sense, but when you have some titles possibly in the <200k sales range, then personally I'd just nuke those and move those teams to greener pastures. But just my opinion :)


obonicus said:
Pardon my ignorance, but can you really get the PC version for free, without having to rewrite code? What was all that about console programmers programming to the metal, even on current consoles?

Well nothing is totally free, but it can be very cheap. They will usually use a multi platform engine that runs on both 360/PC, so they can have a tiny team to get the PC version running. The tools take care of the assets. Again though that's just for the lower sellers. Uber titles like the COD's will have much larger amounts spent on the PC and PS3 versions of course but they print money so it doesn't matter. All the "to the metal" cpu code on the 360 version (vmx stuff) can be simply discarded and replaced with regular C code, since Intel cpu's on PC's handle garbage code really well. You don't have to worry about gpu tweaks as much either since on PC you just need to have a menu area where the user can enable/disable graphics options and resolution to get stuff running quickly enough.
 
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It would be funny if they dumped the PS3, and then two year later XBox720, PS4 and WiiHD came out, and all of them used Cell architecture, with much more SPU's. :-/
Afterall it's a cheap reliable way to make more power available, now when the reasearch investments are done.
Then Activision (and Valve) would probably have some catching up to do, when everyone else had the toolsets ready. :)
 
I'm all for multi platform, I've always thought it makes the most sense, but when you have some titles possibly in the <200k sales range, then personally I'd just nuke those and move those teams to greener pastures. But just my opinion

If you are Activision you've already divested your company of all projects with such low sales expectations during the merger with Blizzard. Forget axing the PS3 port, they'd be better off dumping the whole project and investing the entire proposed budget into better opportunities.
 
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.

It's amazing that you know that much about 99.9% of all 360 development.
 
It's amazing that you know that much about 99.9% of all 360 development.

I personally couldn't really name more than a couple of developers with an abundance of talent which is going all out to extract performance from the Xbox 360. Its pretty obvious even when you don't have access to people in the industry, so I have no reason to doubt Joker when he has the ability to simply talk to people about projects and find out about what their goals/priorities are.
 
It's amazing that you know that much about 99.9% of all 360 development.
Can you tell us the name of the studio working for exclusively for the 360?
There are 3, Rare which didn't do anything good in the last few years (I can't play BK the framerate is too horrid to me, Kameo was really nice as a first effort but I wonder what they did after that) and Lionhead which is not know for its technical prowess. That let Turn 10 I'm willing to see non replay gameplay footage.
Bizarre was doing nicely too but their last title Blur doesn't look great imho. I would even say underwhelming in regard to split second, dirt2 or the new NFS.
I would not be surprised if Capcom Framework 2 is the more advanced engine running on the 360.
But it's going OT I may be wrong but there was a thread in the tech section about state of the 360 development, no? I'll do a search it would be interesting to discuss (in the proper thread).
EDIT
Looks like I was misslead there was no thread as the one I described and I went through a lot a thread including 360 in the title.
 
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This is one thing I never understood about some of the software coming out for the 360 is that their games are selling a ton and you would think the developers are making the money so why aren't they pushing the hardware? Because their is no pressure too? Are developers not fully utilizing 360 capabilities because alot of them are PC ports? Not to mention 360 has been out a year ahead of PS3 it just boggles my mind. Most of the best looking games on 360 are multiplats which happens to perform better on the 360 anyway.
 
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This is one thing I never understood about some of the software coming out for the 360 is that their games are selling a ton and you would think the developers are making the money so why aren't they pushing the hardware? Because their is no pressure too?
I think that the proper response if the game is good enough and launch with proper marketing campaign to back it up and sells good enough why make an extra efforts that in fact few would notice?
Are developers not fully utilizing 360 capabilities because alot of them are PC ports? Not to mention 360 has been out a year ahead of PS3 it just boggles my mind. Most of the best looking games on 360 are multiplats which happen to perform on the 360 anyway.
Well that's an interesting part and I wonder if it would be relevant to have a topic about that what would be a game designed for the 360? What it would have to do to qualify?
I think that when devs here speak of "design for the 360" they think more use of what make the xenos special, mostly memexport, tesselator and huge bandwidth. This exist in the PC realm but only on ATI cards and as editors make game for the widest audience possible...
Actually a "360 game" could be in fact a subpart (kind of archaic) directx11 game. Actually I hope that the unveilling of directx11 will have some positive effects on the 360 developments.
On top of that is how far devs would be willing to optimize and then how tough it would be to port the code to another platform. By coding super close to the metal both the CPU and the GPU you may lose the opportunity for a cheap PC port for example.
 
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I figure it this way, a cheap PS3 port may cost about as much as making a regular Wii game (it actually probably costs more to do the PS3 port, but lets just say it's the same for the sake of argument)

Are we talking about total shovelware like ninjabreadman vs. a higher-profile PS3 game port? Otherwise I can't imagine that engine work would cost more than making assets and running QA. I'm not saying this invalidates your point, it may even strengthen it, I just want to understand.

, and it definitely costs more than porting some 360 games to the Wii which I've seen done by as little as two people.

Again, we're talking about shovelware cash-ins, right? I'm trying to think of what games might be an attempted direct port to Wii. Quantum of Solace and other licensed games? I know that THQ has a different team for the Wii version of their Pixar licenses (or they did for Up), I don't know how Activision works.

So even if 80% of the work is already done, I don't know if it's worth more to keep chasing small but predictable PS3 port sales numbers (just talking about the low sellers here) instead of using it to get a better foothold in the Wii world.

Yeah, but you're talking about the sort of approach that hasn't really worked. Terrible ports to the Wii don't really sell that well. It's the approach that has as lot of pubs even more reticent when it comes to the Wii -- they can't figure out what that crowd buys besides 'lifestyle' games and music games. Which ties into what Mintmaster is saying, more or less. The PS3 audience effectively increases the 360 audience from 30 million to 50 million (give or take), since they buy most titles at a similar pace. If you know you have the audience for the 360 version, you have the audience for the PS3 version.

Meanwhile, the Wii's attach-rate for these same games does seem to be lower (I have no strong data on this, so feel free to correct me), when a port exists (it makes up for it in other areas -- expanded audience and all). Though as I said above, I could imagine this changing for licensed games based on CG movies -- I would imagine that for those titles the PS3's attach-rate may be relatively low, while the Wii version is relatively high (please correct me, again). Or for games where a better alternative exists for the system -- I wouldn't be surprised at all if 2K decided to drop MLB2K on the PS3.



Well nothing is totally free, but it can be very cheap. They will usually use a multi platform engine that runs on both 360/PC, so they can have a tiny team to get the PC version running. The tools take care of the assets. Again though that's just for the lower sellers. Uber titles like the COD's will have much larger amounts spent on the PC and PS3 versions of course but they print money so it doesn't matter. All the "to the metal" cpu code on the 360 version (vmx stuff) can be simply discarded and replaced with regular C code, since Intel cpu's on PC's handle garbage code really well. You don't have to worry about gpu tweaks as much either since on PC you just need to have a menu area where the user can enable/disable graphics options and resolution to get stuff running quickly enough.

That makes a lot of sense, considering how bad most PC ports are. Thanks.
 
Are we talking about total shovelware like ninjabreadman vs. a higher-profile PS3 game port? Otherwise I can't imagine that engine work would cost more than making assets and running QA. I'm not saying this invalidates your point, it may even strengthen it, I just want to understand.
...
Again, we're talking about shovelware cash-ins, right? I'm trying to think of what games might be an attempted direct port to Wii. Quantum of Solace and other licensed games? I know that THQ has a different team for the Wii version of their Pixar licenses (or they did for Up), I don't know how Activision works.

Many are Wii shovelware to be sure, but believe it or not, some are big titles. That "two person" example I mention is an interesting one because it actually is a name brand title believe it or not. On the surface it's easy to think that going 360->PS3 is much easier than going 360->Wii, since 360/PS3 are similar, etc. Turns out though, 360 to Wii is easier. 360->PS3 requires parity, so whatever is done on one must match the other as much as possible. 360->Wii on the other hand is a downgrade, which is easier to do. Doesn't fit in memory? Chop textures. Runs to slow? Yank some scenery out. Etc, basically it's easier to destroy than it is to create. Plus the Wii is a simple machine so you can throw an intern on it, give him free Chinese food and he will happily crank away for hours. With a 360->PS3 port if it doesn't fit in memory or if it runs to slow then you have to resolve it or your boss will kick your ass. And I definitely wouldn't throw an intern at doing a 360->PS3 port :)


Yeah, but you're talking about the sort of approach that hasn't really worked. Terrible ports to the Wii don't really sell that well. It's the approach that has as lot of pubs even more reticent when it comes to the Wii -- they can't figure out what that crowd buys besides 'lifestyle' games and music games. Which ties into what Mintmaster is saying, more or less. The PS3 audience effectively increases the 360 audience from 30 million to 50 million (give or take), since they buy most titles at a similar pace. If you know you have the audience for the 360 version, you have the audience for the PS3 version.

Meanwhile, the Wii's attach-rate for these same games does seem to be lower (I have no strong data on this, so feel free to correct me), when a port exists (it makes up for it in other areas -- expanded audience and all). Though as I said above, I could imagine this changing for licensed games based on CG movies -- I would imagine that for those titles the PS3's attach-rate may be relatively low, while the Wii version is relatively high (please correct me, again).

There's two basic pieces of logic behind milking the Wii. First is the dreaded shovelware method, which yeah I also hate. However, you can spit out a large number of Wii titles this way compared to a single PS3 title. Even if they all sell like crap, there is strength in numbers, so they can still as a whole outsell and out profit a single PS3 title. So on the surface it looks like ooh that Wii title crapped out, it only sold 50k units, but that same team put out numerous other titles, add them all up a and it was still a financial win.

Here's where it gets interesting though. The magical (or nefarious depending on your point of view) thing about the Wii is that it doesn't actually take more money to hit it big. On the 360/PS3 you always need to step up your game so going forward you need better assets, crazier effects, more voice talent, etc, all stuff that takes more time, more money and more effort. On the Wii you don't need more money, you just need the right idea, and that same tiny say 5 person team can make it a million+ seller. So...even if the PS3 version is 80% done and yeah 10 to 20 people can finish the PS3 version and net 100k-400k of sales, these guys still want to find that golden goose, or golden IP in this case, on the Wii. Then for little money they can milk that IP for ridiculous profit. Their current approach has been wrong, I would agree there. They still make money on shovelware, but they won't find the golden IP that way. But dedicate a small team to make proper Wii games and then they might hit it. In the end, we all want the next Cooking Mama!

In principal I completely agree with Mintmaster in that the PS3 version is mostly done, finish it, take some profit, go have a mai tai. But the problem is that the PS3 version generates very *predictable* profit. Before the PS3 version is even done there is already a spreadsheet ready showing what expected sales will be, but that isn't hugely exciting because it's effectively capped profit. On top of that's it's usually the least profitable sku. The Wii is still a wildcard, sales are usually predicted low, but you just never know if you will land the next Wii Fitness.

Most places I know operate like Mintmaster describes. The Wii gets brought up, people resist, and everything stays status quo with Wii getting profitable shovelware and PS3 getting it's ports. But people are looking for a reason to really roll the dice on the Wii, and the PS3's $400 price tag (among other things) is it.

Just to be clear so that people don't get riled up, I'd only advocate cutting low selling PS3 titles to shift to the Wii experiment. If a PS3 port sells 800k+ copies, then party on. And it's likely the PS3 will walk into the holidays at $299, so all this talk is likely moot. But...if they try to ride out another year at $399, then I wouldn't be surprised if there were, shall we say, changes. I think some people, like that Activision dude, might be starting to think that a $399 holiday PS3 is something Sony is considering, hence why he is muscling in. Personally, I would not take his talk as empty threats.


Or for games where a better alternative exists for the system -- I wouldn't be surprised at all if 2K decided to drop MLB2K on the PS3.

Sports games area a different beast, they are usually contractually bound to support all platforms, the sports people don't want a fractured market place. So even if MLB2K sells seven copies on PS3 they will still make another one.


That makes a lot of sense, considering how bad most PC ports are. Thanks.

I can almost feel Nebula cringing in pain :) It sucks, I'd love beefy PC games as well. But Crytek tried it and they were rewarded with piracy, so they changed their game plan. So it goes.
 
Something I never considered was the possibility that an Xbox 360 or Xbox 360 + Wii project would be more profitable than an Xbox 360 + PS3 project. So perhaps its not a rolling scale with say X % of the development budget for one SKU required to port to the other, it has more a fixed cost dynamic running? Therefore if the project is small or the sales aren't expected to be huge then going for just an Xbox 360 release and ignoring the PS3 is to the benefit of a projects profitability huh?
 
Just because you can make 5 Wii games for every PS3/360/PC game, doesn't mean it makes sense to do it. If every developer starts doing that, won't that basically saturate the market, driving sales of individual games down.

The PS2 was the perfect example of this. Early on in a consoles life a few million selling game would effectively have been bought by around 10% of all console owners. Now look at God of War 2, selling about 2 or 3 million copies in a market of over 100 million potential customers. So it comes down to only a few % of all console owners.

There is limit to how many games you can release on the Wii, and expect decent returns on most of those games. And with a console the that's mostly owned by casual gamers, I doubt that number is very high.

At the start of this generation there was a lot of talk about how rising development costs would effect games. Predicting fewer games and even sell original IP's. But looking back on it, there were plenty of high quality games and a fare share of original IP's. The last few years have been some of the best in gaming, and now looking forward after E3, next year might even top that.

If there is a trend of developers moving towards the Wii, I'm not noticing it. But since I mostly buy high quality games, I can only imagine the mediocre games being moved to the Wii, if such a trend exists. Which wouldn't be much of a loss to me.
 
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