SvennoJ said:
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.
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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.
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I did forget about those other forms of income through merchandising and games and blu ray sales and in that context it makes much more sense.
Progress would be slower but since I don't think consumers are hurting for pretty things to look at I don't think it matters if we slow down that progression one bit or even massively. Not all companies can afford to be ahead of the curve. I don't think that needs to be the mantra of more than the huge one's whom can burden themselves with such costs.
In this new context I don't mind Pixar spending money on R&D either. I do mind it for almost every non big 3 developer. I suppose EA, Activision, Ubisoft can do what they please but games selling 3 million within a year shouldn't be a cause to close a studio or seen as unprofitable. We don't need developers delaying games just to make them prettier. I mean especially as a free to play title have they even calculated how many ad views this delay will add to the cost?
Wii Fit spent just about as much if not more on advertising as it did on the development of the game. Though that was still only 1/5 of what Atvi and EA spent. That marketing noise drowns out almost everything else. It creates another toxic environment where most can only spend more to get ahead. As if the graphics arm race wasn't enough to do them in.
