mrstickball said:
Wait a second.
Why are we arguing ROI when no one knows actual development costs? It's nice to say that the Wii version, since it was a port, cost 5-10% of the PS3/X360 version, but exactly what was the ROI, even with those numbers?
Let's use my $30m 40/40/20 example:
X360 Version:
$12m budget (40% of $30m), $192m gross profits. 1,600% return on investment.
PS3 Version:
$12m budget (40% of $30m), $114m gross profits. 950% return on investment.
Wii Version:
$6m budget (20% of $30m), $26.4m gross profits. 440% return on investment.
Now, I must ask...How did the Wii have better ROI? Unless the Wii version cost LESS than $1.6 million dollars (5.3%), it did not have a better ROI than the X360 version.
Furthermore, lets not forget that the ROI on the X360/PS3 accrued MUCH quicker than the Wii. So if you want to talk about how quick the ROI was, it favors the X360/PS3 even moreso: within 4 weeks of launch, the X360 version outsold the Wii version by just under 10:1, and the HD twins outsold the Wii version by 14.5:1. That's in comparison to the current LTD numbers of just under 6:1 for the X360, currently, and about 8.5:1 for the HD twins.
So lets summarize:
ROI was much higher on the X360 (1600%) and PS3 (960%) versions than the Wii (440%) versions using a $30m budget + 40/40/20% split for development costs. Unless the Wii version cost under $1.6 million USD to develop (5.3%), it did not have a higher ROI.
Furthermore, if you want to talk about ROI by month, it's even more skewed, as the X360/PS3 had much higher debuts in relation to current LTD numbers.
Finally, I apologize if I offended any people trying to make the point that the Wii made more money. The issue is that bigjon, and the others arguing that point have failed to put any revenue numbers into their argument. That's why I take issue with it: You cannot argue ROI without putting forth any sort of formula. I did. I tried to give hard numbers as best I could. I even gave the break-even point of ROI for the Wii to surpass the HD twins. If you want to argue the Wii version cost less than $1.6m to develop, then feel free to. But please note, no one bothered with actual ROI in this thread. Not even you, Benga. So I fail to see why my argument that the Wii owners are only supporting their stand because they haven't done thier math still stands, because even after taking that 'jab' at them, they have only complained that I said it: but have failed to refute my point.
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ROI is a function of net profit, not of revenue. If you invest $100 and make a net profit of $50 (net revenue of $150) your return on investment is 50%.
I think the 360 game is the #1 SKU, meaning it will likely be the project to which the original budget is allocated. Let's put it on $20 million.
we know that porting from 360 to PS3 will cost 10% of the original budget (Ubisoft said this), so the PS3 version (is a different project) will need an investment of $2 million.
Now let's assume Activision makes $25,- on each game sold. That would make:
360: 5 million * $25 = $125 million - $20 million = $ 105 million net profit.
PS3: 3 million * $25 = $ 75 million - $2 million = 73 million net profit
ROI 360 = 105/20 * 100% = 525%
ROI PS3 = 73/2 * 100% = 3,650%
Please note that I already said twice that I agree with you that this thread is nonsense and that it's obvious that the HD versions are more successful. For ports ROI's are not useful at all, it was basically a trick of bigjon to show of his business knowledge and combining it with positive Wii spin or something like that. That doesn't make it false though, just useless.
