| nitekrawler1285 said: That is ridiculous. It certainly doesn't look as if R&D saved them any resources to create their next products with budgets tripling to TS2 and then doubling again to TS3. In terms of investment vs profit that looks like diminishing returns. Having almost been bankrupt so many times I thought they were better at this. If costs continue to rise and revenue not substantially I cant encourage that as a sustainable business model even if it makes for great entertainment because it means eventually the profits don't cover new ventures let alone familiar retreads. It's also not working in the games industry either and putting many studios in a similar awkward position of not being able to make a next title. Not everyone has GTA and they can't spend money like they do. That only works with subsidies and no one is willing to subsidize forever without adequate return. If working without technical constraints so that people can fulfill their artistic vision and have complete freedom is the concern then of course you will never have a profitable business. If it's art or business I chose business every time without hesitation. |
Diminishing returns are very true for throwing more money at a problem, but they're spending that much money to stay ahead of the competition, ahead of the curve. And it paid off as Toy Story 3 did over 400 million gross at the US box office alone. Add in foreign box office, blue ray sales, tie in game sales and other merchandise.
ps3 and 360 did the same thing in 2005, expensive systems sold at a loss to get ahead of the curve. With ps4 and x1 we see an adjustment back to the normal rate of progression. 360 and ps3 were the exception, and make it seem as if we're already hitting diminishing returns in the graphics department. However Moore's law is still active. Exponential growth in computational power is still continuing, and we'll find other ways when chips can't be shrunk anymore.
I don't mind Pixar throwing huge amounts of money into R&D, demand creates productivity. Somebody got to buy all these super computers for the tech to trickle down to consumer level later. You might think it's not the best thing financially to be an early adopter, but without them progress would be a lot slower.
For games, same thing. Bigger budget, more attention, more people buy your product over the competition. It's a shame when more money is spent on advertising than making the game. $200 million spent on advertising CoD and Battlefield. Now that's a waste.
