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Analysts estimate Blizzard's lost investment after Titan's cancellation
Titan's official cancellation notice yesterday didn't come as much of a surprise to MMO players; after all, the game had been backburnered more than a year ago, its staff transferring to Warlords of Draenor and other Blizzard projects. But the cancellation means Blizzard might never fully recoup its seven-year investment in the game, and that has some analysts worried. "Development costs for Titan may have amounted to tens of millions, perhaps $50 million or more," says one such analyst, Billy Pidgeon, as quoted in a GamesIndustry.biz piece yesterday. Wedbush Securities' Michael Pachter upped that estimate: "My guess is 100 - 200 people at $100,000 per year, so $70 - 140 million sunk cost. It's pretty sad that it took so long to figure out how bad the game was. I expect them to go back to the drawing board." Still another industry observer, David Cole, argued that the current games market simply no longer tolerates seven-year development cycles and high overhead. Pidgeon stresses that it's not all doom and gloom, however: "Blizzard has cancelled several games in various stages of development in the past. Costs for unreleased games can be significant, but launching substandard games can harm the reputation of a successful publisher such as Blizzard. Expenses for development can be considered R&D, and benefits can include invaluable training, IP and technology that can be applied to other games."
Analysts weigh in on Panasonic's Jungle
New tech does not always equal gimme gimme -- according to several prominent analysts, Panasonic is set to engage in quite the uphill battle with its new handheld, The Jungle. Both Bill Pidgeon of M2 Research and David Cole of DFC Intelligence told IndustryGamers they believe the unit is "a non-starter." Colin Sebastian of Lazard Capital Markets said it looks like "an uphill challenge to launch a new portable gaming device unless there is some meaningful differentiation or access to proprietary content," while EEDAR's Jesse Divnich offered that its success hinges on third-party support, saying that, "with any hardware platform regardless of its quality, the absence of strong third-party support will most certainly end in failure." All valid points, but should these guys be giving the device the benefit of the doubt? As it stands right now, we don't know much about the system other than what it aims to do: give MMO players a dedicated piece of hardware so they can take their games on the go. Given how popular MMOs are (and, in turn, how much of the cash money they generate), from a business standpoint it would seem win-win; nobody else is offering something to MMO players who may want a bit of portability. But, on the other hand, the problem is -- at least according to these analysts -- that the handheld doesn't particularly fill a void that can't be filled by a netbook or laptop.
iPhone beats Wii, DS, PSP: 'fastest hardware growth in consumer tech history'
If you wonder why analysts love the iPhone, wonder no longer! Those rascally number crunchers just love to make bold proclamations and Apple's iPhone / iPod Touch ecosystem allow them to do just that. Let's start with Mary Meeker, internet analyst at Morgan Stanley, who told the Web 2.0 Summit crowd yesterday that the iPhone and iPod Touch (which share a common software platform) exhibited the "fastest hardware user growth in consumer tech history"! Don't believe her? Check out that chart. Those numbers even make the DS look pedestrian. Couple Meeker's research with DFC Intelligence analyst David Cole's assertion that the iPhone and iPod Touch devices will be the "primary drivers of mobile game market sales over the coming years" and you've got what those of us in the biz call "consensus." Still think it's not a real gaming platform?
Analyst: DS and PSP growth 'peaked,' iPhone to drum future growth
DFC Intelligence analyst David Cole thinks that Nintendo and Sony devices will still lead the handheld market by 2014, but that the iPhone/iPod Touch will drive growth, thanks to a little thing called the App Store. IndustryGamers took note of the new report, where the analyst believes that the worldwide mobile and portable games market will reach $11.7 billion by 2014, which includes the PSP and DS, with Apple's devices pushing 24 percent of software sales.The company found that of over 8,000 surveyed respondents, 54 and 69 percent of North Americans and Europeans, respectively, had played a game on their phone in the last year. The report found that the the most popular service for purchasing apps for their phone was Apple's App Store -- shocking, right?
Gamasutra asks: "Is there anything wrong with the PSP?"
We'd like to think that there's nothing wrong with our beloved handheld. However, the truth is that many people, misinformed or not, do not believe in Sony's platform. Gamasutra asked a number of industry professionals about what they think is wrong about PSP, if there is anything at all. David Cole from DFC Intelligence points out that the price drop is a good step, but that's not enough. "I think a new form factor is needed more than a price cut." Ed Barton from Screen Digest is frustrated at the constant comparisons to Nintendo DS: "We forecast that the global installed base of PSP users will be around 29 million at the end of 2007, generating $1.9 billion in software sales. Lifetime software sales at the end of 2007 will be around $4.5 billion. If this is 'failing,' then failure just got a huge brand makeover." Mike Wolf from ABI Research thinks that anti-Sony fanboyism runs wild due to high expectations placed on Sony ... due to their ambitious claims. "I believe the device's perceived 'failure' by some is due to the device struggling to live up to Sony's own marketing of the product, much like what the PS3 is going through today." I completely agree with many of the things these professionals have to say about PSP. It's true that PSP is certainly not a failure, but it could've been far more successful as well. Sony has made a ton of mistakes this life cycle, but as they've been recently showing, things can easily change with a refocused effort.
DFC Intelligence outlines next-generation views
Sure, we've seen the countless polls and message board flamethreads that are the next-generation console wars. Amidst all the fanboy dreck, however, it's nice to know that industry experts can offer their opinions in a logical fashion, with solid facts to back up their conjectures. Such a report can be found here, written by DFC Intelligence's David Cole. It shares some interesting views on the current market views regarding the Playstation 3 (especially from an international perspective), and describes the possibilities of shift in console market share. Certainly a read for the more business-minded gamer, but a decent one nevertheless.
