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CBS looks at the rise of spectator e-sports
In a "Game On" segment, CBS Sunday Morning featured an in-depth look at e-sports and the spectator community that has grown up around them. It showed how games like StarCraft II and League of Legends have packed stadiums full of people who watch and cheer on their favorite teams of gamers. "I think I'm too old to understand what's going on in online gaming now," the reporter comments at one point. Our dear friend Research Analyst Michael Pachter replies, "You probably are." You can watch the entire eight-minute segment after the jump. [Thanks to Sorenthaz for the tip!]
Destiny hotfixes out a loot cave, players uncover more DLC areas
Destiny has a bit of an issue with caves, particularly those that allow players to stand around and shoot until candy comes out. An upcoming fix will adjust auto-rifle damage, boost scout rifles, and also cut off another loot cave from the players. The development team is also working on fixes to under-performing Exotics and tweaking overall class balance. Meanwhile, the game's players have managed to uncover another DLC area in the video past the break, uncovering unpopulated regions on the Moon that tie into an unknown portion of the game's expansion content. Analyst Michael Pachter weighed in briefly on the game when he predicted that game sales for September 2014 would be in a slump compared to September 2013, stating that Destiny's ubiquitous media presence would provide an overall figure around 2.75 million, a bit below Bungie's stated 3.2 million daily logins.
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."
Toontown Online 'homage' illustrates emulator quandary
Disney's Toontown Online was shut down last year, but that hasn't kept fans from working on a so-called "homage" to the game. A team of 24 or so volunteer developers have been working on making Toontown Rewritten with publicly available images and their own skills as programmers and artists. While the team isn't charging players to access the title, its status as a de facto emulator could put it in jeopardy with the Mouse House. Disney hasn't commented on it yet, but copyright attorney Scott Landsbaum noted the quandary that such projects face: "When does a fan homage that is beneficial to your brand cross the line to infringement that can no longer happen?" Analyst Michael Pachter claimed that it was "unusual" for fans to take on such emulator projects, which was rebutted by Raph Koster, who tweeted, "Sorry Pachter, but hasn't EVERY shuttered MMO (and some open ones) been remade by fans?" A similar project for the also-defunct Pirates of the Caribbean Online claims that Disney has given the emulator its blessing.
Pachter: PS4, Xbox One under $400; current-gen price drops this year
Wedbush Morgan analyst Michael Pachter is predicting a sub-$400 pricing scheme for the PS4 and Xbox One – $349.99 for the PS4 and $399.99 for Xbox One. This comes from the investment firm's annual E3 preview report, which unsurprisingly calls out the next generation consoles as the main focus of this year's Electronic Entertainment Expo in Los Angeles. Pachter says the Xbox One pricing "makes sense given that the Xbox 360 Pro debuted at that price point in November 2005," though he stresses that this is without any type of subscription or subsidies program - like a cable television provider. As for PS4, Pachter asserts it'll make its debut at a lower price point than the PS3 as that $599 debut "negatively impacted its long-term popularity." "We also expect the hardware manufacturers to announce price cuts," Pachter writes in the report (pdf link). He predicts both the PS3 and Xbox 360 will be reduced by at least $50 in the run-up to the holidays, while he says the Wii will be knocked down to $99 - maybe we'll get our own Wii Mini? Pachter also says Nintendo may try to increase Wii U sales through a price cut or "a bundle that includes some of its more popular software." Finally, he anticipates a PS Vita price drop, too.
Pachter: Wii U sales hit 55,000 in April, 20,000 below Wii
Nintendo's Wii U sold 55,000 units in April, down 19 percent from March, while the Wii sold 75,000 in April, down 16 percent from last year, Wedbush analyst Michael Pachter estimates. To compare, he says Microsoft sold 205,000 Xbox 360 units and Sony snagged 165,000 sales of the PlayStation 3 this April. By these numbers, sales of the Xbox 360 are down 13 percent and PS3 sales are down 5 percent year-over-year. Nintendo hit 185,000 sales of its 3DS last month, a 46 percent jump in sales from the previous year, Pachter says. Sony's Vita is down 57 percent from 2012, selling just 30,000 units this April. These are of course the standard Pachter estimates, which can only mean one thing – the official numbers are on their way, via the NPD. Those figures are expected on Thursday. As of March 31, the Wii U has sold 3.45 million units since its launch, below Nintendo's initial forecast of 5.5 million, and even January's adjustment to 4 million. Nintendo expects to have sold 9 million Wii U consoles by next fiscal year, ending March 2014, with sales spurred by the release of "key Nintendo titles."
Rumor: EA putting itself up for sale
Electronic Arts, long known for assimilating numerous studios under its label, may be putting itself up for sale in return. The New York Post reports that EA is looking into such a deal with various interested firms, such as KKR and Providence Equity Partners. One of the Post's sources said that EA would be willing to sell to such a firm at $20 a share, even though the company's share value is currently just north of $13. Its stock fell from $25.20 nine months ago, although industry analyst Michael Pachter predicts that EA's stock should double within a year. EA isn't the only company looking to shore up its future, as the videogame market is slumping worldwide since last year. One bright spot is its digital sales, which are up over 2011's numbers and resulted in a $324 million revenue in the first quarter of 2012. EA refused to comment on the rumor, as did KKR and Providence Equity.
Investment group predicts positive returns for Star Wars: The Old Republic following free-to-play announcement
Yesterday's bombshell from Star Wars: The Old Republic has prompted the usual spirited debate among fans over the game: Is this a last gasp before it dies or a smart move in the current MMO marketplace? Wedbush Securities believes it's the latter, with analyst Michael Pachter stating that the news from Electronic Arts is positive and that the change in business models should result in a significant profit for the game. Pachter described Wedbush's reaction as "incorrigibly positive," with specific emphasis on EA's digital catalogue and the free-to-play shift for Star Wars: The Old Republic. According to his analysis, the change in business models will remove the most significant hurdles from potential players, leading to a net increase in revenue from the game. The market as a whole responded positively to the financial news, with EA's stock rising six percent as a result of the call. Pachter has previously been critical of the MMO market, having claimed in early July that subscriber numbers have peaked for the industry as a whole.
MMO Roundup: Politics, cosplay, and The Secret World
Sometimes, you'd like to know that there are other MMOs out there, right? It's not all WoW, all the time! Our sister site Massively can provide you with everything you need to know about all of the other MMOs around -- past, present and future. MMO subscriber numbers have peaked, says industry analyst Industry analyst Michael Pachter has a history of blowing hot air, but when he speaks, others listen. Pachter is back with a few more controversial remarks concerning the growth -- or lack of it -- in the MMO market. Speaking at the Evolve Conference, Pachter said, "It looks to me as though the MMO market is as big as it's ever going to be -- as far as subscription MMOs." TERA guild farms itself for political gain, playerbase outraged TERA's endgame political system features something called a Vanarch, a player-elected representative. Vanarchs can impose taxes, toggle PvP on or off, and generally meddle in the affairs of other players. En Masse recently adjusted the system to allow Vanarchs to rise to power through guild-vs.-guild combat. In doing so, it cleared the way for mega-guilds to split in two and farm their way to political office. Amazing amateur MMO cosplay While many facets of geek and video game culture are adequately represented in the cosplay community, MMORPG cosplayers can be a little harder to find. Is it truly underrepresented, or is it simply harder to find? Check out Massively's top 10 amateur MMORPG cosplay. The Secret World's launch and future The Secret World, the modern day urban fantasy MMO from Funcom, launched very recently. Massively had an opportunity to sit down with The Secret World's creative director Ragnar Tornquist and discuss the game's present and future. Massively Speaking Episode 208: Invest in copper Massively Speaking, Massively's MMO podcast, returns this week with hosts Justin Olivetti and Bree Royce. Topics include Funcom, City of Heroes, Vanguard, TERA, and Guild Wars 2. Massively's week in review Don't let WoW Insider do all of the talking when it comes to Massively's best content of the week. The Massively staff themselves have picked out what they think is the best content their site has to offer in their own weekly roundup.
MMO subscriber numbers have peaked, says industry analyst
Whether you love him, hate him, respect him, or ignore him, when Michael Pachter speaks, his voice carries. So it's of note that everyone's favorite videogame analyst is back with a few more controversial remarks concerning the growth -- or lack of it -- in the MMO market. Speaking at the Evolve Conference, Pachter said, "It looks to me as though the MMO market is as big as it's ever going to be -- as far as subscription MMOs. People willing to play $15 a month, there are six or seven million of them. Period. If Star Wars couldn't expand it, when it's made by BioWare, nothing can do it. That's why Curt Schilling's 38 Studios went out of business, because he couldn't get financing." In May, Pachter proclaimed that nobody was buying MMOs after Star Wars: The Old Republic's launch.
Report: Vivendi looking to sell 'part or all' of majority stake in Activision
Activision's French multimedia conglomerate parent company, Vivendi SA, is said to be considering a sale of its 61 percent controlling stake in the US-based Call of Duty publisher. Bloomberg reports that Vivendi is holding a meeting on June 22 to discuss the potential for a sale of "part or all" of its Acti holdings. The report comes from "people with knowledge of the matter," who refused to be identified due to the privacy of the June 22 event.A Vivendi representative confirmed the upcoming executive get together, but didn't discuss the specifics of the meeting. Said meeting has taken place annually since 2005, and the rep noted it's intended as "a forum of exchange and discussion, not for quick-fix decisions or solutions."Vivendi and Activision came together in 2007, creating Activision-Blizzard as a result of the merger. Vivendi sold three percent of its Activision stock in late 2011, but kept approximately 60 percent of its holdings. Since today's report, Vivendi's stock rose 3.7 percent in Paris markets.Update: To help contextualize some of this super business-y madness, Wedbush Securities analyst Michael Pachter told Joystiq, "Some believe Vivendi is worth more if it is split up into various parts. The potential split doesn't really mean anything for Activision, other than a lot of shares on the market all at once. I don't think a sale is likely, as there are few potential buyers, if any. Instead, it makes more sense for Vivendi if they have Activision borrow a lot of money and pay a dividend of all of its cash. Spin it off to Vivendi shareholders." He added that he's not sure if the report is accurate or not.
Analyst says no one is buying MMOs after SWTOR fizzled
Wedbush Securities analyst Michael Pachter has a dim view of MMO assets following the lukewarm performance of Star Wars: The Old Republic. "Nobody is buying MMOs after Star Wars fizzled," Pachter told Joystiq. The context surrounding the statement involves the valuation of 38 Studios in the wake of its Copernicus melt-down. "There is just no demand for game assets right now, as THQ proved when it tried to sell the Warhammer MMO. I think [Electronic Arts] could step in, since they are the publisher, so you might see some alternative way to get 38 some bridge financing," Pachter said.
Wedbush thinks Grand Theft Auto 5 will launch in October
With this morning's announcement that BioShock Infinite will now launch in February 2013, publisher Take-Two Interactive altered more than a game's launch date. Take-Two is a publicly traded company, and one fewer gigantic product launch during the holiday season – arguably Take-Two's only holiday product launch, unless you count fall launches of Borderlands 2 and XCOM: Enemy Unknown as "holiday" – means that shareholders will want to know what's up. That worry is reflected in Take-Two's stock price, which took a five percent hit since the market opened this morning.But when Infinite got pushed out of the holiday season, it opened the slot up for another high-profile Take-Two-published title: Grand Theft Auto 5. "In our view, the delay opens the window for Grand Theft Auto V to be released in October 2012," Michael Pachter of Webush Securities wrote in an email this morning, echoing a release window leak from earlier this year.In his eyes, Infinite wasn't just delayed to make it "something even more extraordinary," as Ken Levine put it, but because the folks at Rockstar, "notified Take-Two that GTA V would be ready for October." He believes this resulted in Take-Two offering Irrational Games an extra few months to prepare BioShock Infinite. His logic? "The studio [Rockstar Games] has scheduled every prior GTA release during that month (with GTA IV delayed to April 2008, due to bugs in the PS3 version)."Furthermore, Pachter and co. speculate we could hear more about GTA 5's launch date "as early as May 22" during a scheduled quarterly investor call, or perhaps in a few more weeks at E3 2012. We've yet to hear back from Irrational, Rockstar, or Take-Two on the subject.
Analyst: SWTOR caused Dragon Age III delay
There's been a lot of discussion following the recent EA earnings report in which the company announced that Star Wars: The Old Republic has 1.3 million subscribers, down from its previous 1.7 million mark. We've heard from the fans, the critics, and the studio itself -- now it's time for the analysts to contribute their side of the conversation. According to Wedbush Securities analyst Michael Pachter, EA's investment in SWTOR has caused a delay in other projects at BioWare, particularly in Dragon Age III's case. The analyst noted that Dragon Age III's expected release window was delayed, and he says this is due to the enormous undertaking of SWTOR. "We believe that a significant portion of the BioWare team responsible for the game was reassigned to Star Wars in order to create content and fix bugs to keep the game's audience engaged," Pachter said. Delay or no, Pachter is upbeat about EA's future, especially in light of the earnings report's news that the company turned a profit. He says that the company will continue to grow, make money, and be a good bet for investors.
Nexon bids for EA takeover, everyone says it's very unlikely
You know Nexon, right? The South Korean MMO company that made Maple Story and ... uh ... Everplanet ... and stuff? Anyway, Nexon is a pretty big deal on the other side of the Pacific Ocean. Such a big deal, in fact, that it's looking at buying out some of its rivals, apparently including EA. MK Business News (a South Korean newspaper) reports that Nexon's Japanese headquarters spoke with EA about a potential acquisition recently.What came of those talks, however, is unclear. For its part, EA isn't offering any news. "We don't comment on rumors and speculation," is all reps told us, which you'll notice isn't a denial of said talks taking place.But could such a deal even take place? Experts don't seem to think so. "My takeaway is that this deal cannot happen," Wedbush Securities analyst Michael Pachter told GI International. "There are few, if any synergies, and no reason to believe that Nexon could run EA's assets more efficiently. Nexon shareholders would own a completely different company than what they bought in the December IPO," he added, referring to Nexon's late 2011 public stock offering.So for now, while the talk of an EA takeover is always scintillating to discuss, it's very likely not happening (at least via Nexon) anytime soon.
Pachter says rumored Nexon buyout of EA 'cannot happen'
Forbes reported on a rumored takeover of Electronic Arts by Nexon earlier this morning. The magazine noted that EA shares spiked following a supposed bid by the Korean gaming giant. Wedbush Securities analyst Michael Pachter weighed in on the rumors at GamesIndustry.biz, saying that the deal "cannot happen." He guesstimates that EA will balk at any such deal because "Nexon couldn't pull off a stock-for-stock deal [...] and would have difficulty financing an all-cash deal to make EA shareholders happy." Pachter floats a few numbers in his analysis, and he also notes that EA CEO John Riccitiello isn't likely to cede control of the company to anyone outside of EA management.
3DS sold under cost since price cut, Nintendo 'hoping' to profit by March 2013
Nintendo took a big hit last year when it dropped the price of its then-nascent handheld, the 3DS, to $170 just a few months after initial launch. Such a hit, apparently, that Nintendo is selling the unit for less than it costs the company to produce, as revealed in the company's latest financial earnings. "Its hardware has been sold below cost because of its significant price cut in the fiscal year ended March 31, 2012," the financial report says.But don't count Nintendo out! The company says it "expects to cease selling it below cost by the middle of the fiscal year ending March 31, 2013." Which, in normal human terms, means Nintendo expects to start making money on the console around August of this year. So, you know, if you're really trying to stick it to Nintendo, go buy the 3DS between now and August. That'll show 'em!The 3DS currently sells for $170, down from the $250 price tag it launched with back March of 2011.Update: We've added context from financial analyst extraordinaires Michael Pachter (of Wedbush Securities) and Jesse Divnich (of EEDAR) just below the break.
'Little risk of failure': Analysts predict SWTOR will turn a healthy profit
Worried that Bobby Kotick has the right of things and that Star Wars: The Old Republic won't make bank for Electronic Arts? Market analyst Michael Pachter disagrees, saying that he not only predicts that EA will cover the costs of SWTOR's development, but come out just fine even with LucasArts taking its share. Pachter says that LucasArts will claim 35% of SWTOR's revenue: "The revenue split is around 35 percent to LucasArts after EA earns back their investment. That means EA keeps most of the revenue from disc sales (they have marketing expenses and need to staff up the server farms), so they should earn a nice profit there. Keep in mind that EA expensed the development cost when incurred, so much of the disc sales revenue will be profit." Pachter's predictions for the title are sizable yet reasonable; he thinks that SWTOR will get 1.5 million subscribers. This translates to $270 million per year in revenue, $80 million of which will be pure profit for EA after LucasArts and operating costs take their share. Even if SWTOR only draws in -- or sustains -- merely 500,000 subscribers, Pachter says the game will be sitting pretty. Other market analysts, such as EEDAR VP Jesse Divnich, support the notion of SWTOR's profitability. "Based upon user commentary and consumer surveys, the profit potential for The Old Republic is high. We see little risk of failure for The Old Republic," Divnich stated.
Microsoft buys indie developer Twisted Pixel
After developing games exclusively for Xbox 360 and PC, it's fair to say that indie dev Twisted Pixel has been going steady with Microsoft. Today, the two have finally tied the knot as the Redmond corporation announced that it has purchased the Austin studio. That may be terrifying news for fans of the dev, which has built games like 'Splosion Man and The Gunstringer around its scrappy DIY aesthetic. But Matt Booty, general manager of Microsoft Studios, told Joystiq it's exactly that character that the company hopes to preserve after the sale.
PSN Breach: What it means for you, and for Sony
It's been nearly one week since the PlayStation Network servers were taken down due to an "external intrusion," and nearly one day since we learned PSN users' personal information was stolen during said intrusion. We're still not quite sure of the full scope of the security breach, but the latest update from Sony paints a fairly upsetting picture: Gamers' personal (and, possibly, financial) data has been exposed on a scale more massive than the gaming industry has ever seen. To help get a grasp on the situation, we spoke with consumer advocates and tech industry figures about what gamers can expect in the aftermath of this security breach. For instance: What financial or legal repercussions might Sony be facing in the coming months? And what can PSN users do to protect themselves from potential identity theft?
