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Forums - Gaming - (IMO) Desperate pricing for a Tomb Raider in need.

First of all, not sure if this is a sales or gaming discussion as it covers a broad range of subjects, so mods, move it as you see fit.

As we all remember, When the TR reboot was released, we all thought SE and CD had a success on their hands, only for SE to turn around and say the game had to sell between 5-6 million copies within its 1st 4 weeks to be considered a success. Although the game sold 3.4million copies, it wasn't until the end of 2013 that the game managed to break even. This was due to the $100 million budget the game had.

http://www.eurogamer.net/articles/2014-01-17-tomb-raider-finally-achieved-profitability-by-the-end-of-last-year

Now rumours have it that RotTR had a similar budget of a $100 million and that being one of the reasons for MS's exclusitivity deal (to get to black sooner as supposed to later). Rumours are that MS payed around $20 million and picked up some of the marketing costs meaning SE only had to bring in $80 million more to break even. However, as it stands now, well atleast according to chartz, RotTR has sold around 1.75 million copies across PC, 360 and X1. 

1st full four weeks: 836k sold (~ 616k X1, ~170k 360, ~50k)

MS PR: 1million+ by the end of December 2015. https://www.destructoid.com/well-rise-of-the-tomb-raider-hit-1-million-sold-at-least-331617.phtml

By early December, and probably due to a combination of slwo sales and the holiday period, RotTR was already being discounted (so were games such as Fallout, but they had sold far more than RotTR). 

http://www.gamespot.com/articles/gaming-deals-40-rise-of-the-tomb-raider-buy-2-get-/1100-6432883/
http://www.polygon.com/2015/12/22/10645708/xbox-holiday-sale-countdown-discounts-xbox-live
http://n4g.com/news/1833364/rise-of-the-tomb-raider-sees-33-price-cut-on-amazon 

The game was given away as part of free games with X1 deals and then saw further drops in price across 2016. The game for the last few months can be found as cheap as $25 brand new. 

https://www.amazon.com/Rise-Tomb-Raider-Xbox-One/dp/B00KVRNIQU

As we know, no publisher takes home the full $60 from a game. As the Kotaku article below shows (and other sites covering breakdown of cost), the publisher roughly takes home $27 from a fully priced $60. So let's do the maths for RotTR:

http://kotaku.com/5479698/what-your-60-really-buys

If RotTR sold 2 million copies at full price:

80million budget (taken $20million MS financed away)
2,000,000 X 27= $54,000,000
Loss= $26,000,000

If RotTR sold 1 million copies at full price

1,000,000 x 27= $27,000,000
1,000,000 x 18= $18,000,000 (The 18 is for the discount which was applied by MS on their store and other stores equating to 33% off)
Loss= $35,000,000

If RotTR sold 700k at full cost (the 33% off discounts kicked in about a month from release)

700,000 x 27= $18,900,000
1,300,000 x 18= $23,400,000
Loss= $37,700,000


I won't go into the free bundled copies, the b1g1f copies or the one which have been sold for $25 /£25 as the above gives a good indication of how good / bad they have done under the best circumstances (all copies sold at full price). Also, I'm sure there is money they have made from DLC (although I have no idea how much it would have cost to create the DLC and how well the DLC has sold) and limited and collectors editions so in the end, it should balance out some what.

SE probably knows they haven't sold enough copies and certainly not enough at full cost. They also know that there won't be a next gen any time soon unless they are to develop a 2K or 4K definitive edition of the game for Neo and Scorpio, meaning they are banking more on making their money back from the PS4 lanuch. Additionally, they know there is bad blood between their PS fanbase and themselves.

SE out of desperation to claw back production costs took on MS's offer and (IMO) now are hoping to at least sell 1million units on the PS4 at full price to bring down those losses.


Scenario 1 (2 million sold at full cost):
1,000,000 x 27= $27,000,000
2,000,000 x 27= $54,000,000
Profit= $1000,000

Scenario 2 (1million discounted):
1,000,000 x 27= $27,000,000
1,000,000 x 27= $27,000,000
1,000,000 x 18= $18,000,000
Loss= $8,000,000

 Scenario 3 (700k sold at full price):
1,000,000 x 27= $27,000,000
700,000 x 27= $18,900,000
1,300,000 x 18= $23,400,000
Loss= $10,700,000


I believe the $60 release on the PS4 is a desperate attempt to claw back on those losses. I personally don't think the PS4 version will sell a million copies at full price. If they are lucky they might 500k, considering the other big games which are being released this year which will all have bigger and better markerting pushes than a year old game. Just like last year, RotTR might be buried under big titles and marketing for:

Mafia 3
Watch Dogs 2
TLG
PSVR and all the games that come along with it
FFXV
COD
BattleField 1
Destiny
FIFA 17
Persona 5
TF2
WoFF
GR2


What is interesting to think about is how the sales may have eneded up had they released the RotTR at the same time on the PS4, considering the PS4 was without a big game at the end on 2016 since Uncharted 4 got delayed. The reboot TR sold 1.1million units by the end of its 4th week on the PS3 and a total of approx 2.1 million copies before the end of the year (9.66 months since it was releases in first week of March).


4 million copies sold at full price
4,000,000 x 27= 108,000,000
profit = 8,000,000 


3 million copies sold at full cost
3,000,000 x 27= 81,000,000
1,000,000 x 18= 18,000,000
loss = 1million

2 million copies sold at full cost
2,000,000 x 27= 54,000,000
2,000,000 x 18= 36,000,000
loss = 10million


What do you folk think? How well do you think RotTR will sell on the PS4 at full price and if it doesn't sell well, will it, if at all effect the third installment in the series?


 



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All of this is flawed from the start as we actually have no idea about how many copies were sold digitally.

Continuing to ignore the digital copies does not make any sense anymore and like Halo 5 proved already; they can be quite significant (on Xbox One and Play Station 4 as well).

So no, I do not think the 60$ price is related to any "desperation" at all... And I actually think the game did very well already and will do even better with the Play Station 4 release. And I'm pretty sure we will see another Tomb Raider soon based on the sales of this one already.



Imaginedvl said:

All of this is flawed from the start as we actually have no idea about how many copies were sold digitally.

Continuing to ignore the digital copies does not make any sense anymore and like Halo 5 proved already; they can be quite significant (on Xbox One and Play Station 4 as well).

So no, I do not think the 60$ price is related to any "desperation" at all... And I actually think the game did very well already and will do even better with the Play Station 4 release. And I'm pretty sure we will see another Tomb Raider soon based on the sales of this one already.

/thread

Until we get digital numbers consistently there is no way to define these things.



Man, MS probably gave them a bazillion dollars... I bet Phil carries a billion around in his butt-crack he is so rich.... Working at MS, dream job!



IF the game had $100 million budget, then giving exclusivity for $20 million sounds incredibly stupid. So yeah, I don't think we have the facts yet. They could have easily made $20 million not going exclusive.

Based on VGChartz, Steamspy, and an assumption on digital sales. I think RotTR has passed 3 million. Just my guess though.



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.......What?



Proud to be a Californian.

Dunno about the numbers in this thread (whether imagined or extrapolated), but it will be interesting to see how this game ends up selling, full price and otherwise.



I believe this is the norm when games are ported over late. Typically they come with extra content at full price. I think Mass Effect 2 launched at 60, and Mass Effect 3 for Wii U definitely launched at 60. I think Bioshock was 60 dollars as well.

There's really no need to discount it immediately. Let it sell what it can at 60, then drop it down, like you would with pretty much any other release.



shikamaru317 said:
Wait, how do we know the budget is $100m? That sounds pretty high to me. Did Square ever talk about the game's budget?

Square has never mentioned the budget for either. The original was reported to have a $100 million budget and the sequel supposedly has the same budget. 

 

http://www.gamezone.com/originals/rise-of-the-tomb-raider-was-it-microsoft-s-commitment-or-compensation-jv9a

 

In pretty sure the definitive edition of the game didn't ship at full cost. Etherway, October shall be an interesting month for sales. Hopefully we won't have to wait long for sales numbers to update here.



Imaginedvl said:

All of this is flawed from the start as we actually have no idea about how many copies were sold digitally.

Continuing to ignore the digital copies does not make any sense anymore and like Halo 5 proved already; they can be quite significant (on Xbox One and Play Station 4 as well).

So no, I do not think the 60$ price is related to any "desperation" at all... And I actually think the game did very well already and will do even better with the Play Station 4 release. And I'm pretty sure we will see another Tomb Raider soon based on the sales of this one already.

I'm not doubting it sold well online. MS themselves said the game crossed 1million units sold by rhe end of December which is why I'm saying 2 million copies sold as supposed to 1.75million copies. Even if it were 2-2.5 million copies, it doesn't change the fact that from the end of the first week in December the game was discounted to 33% off on XBL. 

 

I'm not doubting it will sell copies on the PS4 or that it will have a sequel, what I'm saying is that there is no way SE can go on creating a game with such a huge budget with little pay off, or a pay off that doesn't come until a year or more later.