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Forums - Gaming - Will Microsoft cease to have 1st party games? Another internal studio closed.

NinjaKido on 23 January 2009
ymeaga1n said:
RPG said:
Slimebeast said:
RPG said:

 

Doubt that, pretty sure most if not all Sony's first party games have made profit. With that said the ones which will definitely sell well ala GT5, GOW III and KZ2 have not even released yet so nope, cant see the first parties being a burden for Sony.

 

 But then why don't MS go that route if it's really profitable?

And unlike a comparison to Nintendo, MS and Sony are very comparable in their gaming business - same size of console sales, same ambitions and target audience.

I think you're just hoping Sony's big budget titles are making money. But MS is one of the smartest software guys on the planet - if they saw there's money in having their own studios they would invest in it, not downsize.

I dont have to hope, if the numbers of this site are correct the first party games are making money. MS have kept Lionhead and Rare whom make games which sell, they know first party games are still important. Also Turn 10, the guys who make Forza have remained.

 

Making money doesn't equal profit. Last I checked vgchartz doesn't report the costs of developing a game. Sony's financial statements do though, and that...well....

 

Just because Sony isn't making a profit off the entire division doesn't mean 1st party titles aren't making a profit , there's plenty of factors to consider.

 



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fulcizombie on 23 January 2009
darthdevidem01 said:
@slimebeast

SONY's 1st PArty games sell more than MS's ones easily.

GT5:P alone has most probably covered 75% of the costs of GT 5 Development.

remember the vg chartz figure isn't accurate as online downloads of GT5 Prologue havn't been counted.

Really ?? I see the exact opposite . MS- published games are selling great , AT LEAST ACCORDING TO OFFICIAL NUMBERS , while sony still hasn't published a true hit with the ps3 being on the market for 26 months .

RPG on 23 January 2009
Slimebeast said:
RPG said:
Slimebeast said:
RPG said:
Slimebeast said:

MS first party game production is already weak compared to Sony and Nindendo, and they're shrinking 1st party development - so it can only mean that 1st party studios cost too much money and don't bring any profit.

And that must mean that Sony is losing tons of money making all their big IPs now that they're just a 60 million consoles maker instead of a 120 million console maker (because a halved install base must be reflected in game sales).

I wonder how long Sony can keep his over-sized 1st party development at this size with so many big budget IPs they have.

 

Doubt that, pretty sure most if not all Sony's first party games have made profit. With that said the ones which will definitely sell well ala GT5, GOW III and KZ2 have not even released yet so nope, cant see the first parties being a burden for Sony.

 

 But then why don't MS go that route if it's really profitable?

And unlike a comparison to Nintendo, MS and Sony are very comparable in their gaming business - same size of console sales, same ambitions and target audience.

I think you're just hoping Sony's big budget titles are making money. But MS is one of the smartest software guys on the planet - if they saw there's money in having their own studios they would invest in it, not downsize.

I dont have to hope, if the numbers of this site are correct the first party games are making money. MS have kept Lionhead and Rare whom make games which sell, they know first party games are still important. Also Turn 10, the guys who make Forza have remained.

 

You still don't know. Let me remind you that most game publishers have a very hard time making a steady profit of more than 5% - for example Ubisoft, EA, and Take Two - despite being multiplatform.

What conclusions you draw from this? Well, one must be that many games published by Ubisoft, EA, TT lost money.
(and another that video game developing is a very competitive market and hard to make money in)

Whenever you read publisher press-releases like "Assassin's Creed was a huge success, but games like Prince of Persia failed to meet expecations" it's very likely that PoP lost money. Or "Madden had impressive sales, but Mirrors Edge sold a lot less than EA had projected" it's very likely that Mirrors Edge lost money.

Now, these kind of games still sell in the millions. But they also cost a lot to develop.

So I can only imagine that new IP from Sony like Resistance, Uncharted, Motostorm, Lair and Heavenly Sword and games like Ratchet - games that sell on average less than 1.5 mill - lost a lot of money.

Btw, Rare is a bad example of proof that 1st party is beneficial. Rare is a disaster for MS, not just because it cost insane amunt of money to aquire, but because it's a big ass studio (300 guys or so?) who don't have a clue about what the market and gamers want. I bet MS would get rid of Rare tomorrow if anyone just wanted to buy them.

It also seems you dont have a clue about how first party games work. Sony recieve a much larger amount of money from first party games compared to 3rd party games, that is why they make back money so quickly. On GAF it was posted where the $60 go and for first party games they get a huge proportion of the money, at least half if memory serves.

3rd party devs get a much smaller return, they have to pay the console company the game is on, get a smaller amount back etc so of course they will need more sales. Even games which sell 1 million for first parties make Sony at least $30 million back, pretty sure that is more than enough to cover costs. And that is the bombas, resistance and uncharted sold well over 1 million.

 



 

RPG on 23 January 2009
ymeaga1n said:
RPG said:
Slimebeast said:
RPG said:

 

Doubt that, pretty sure most if not all Sony's first party games have made profit. With that said the ones which will definitely sell well ala GT5, GOW III and KZ2 have not even released yet so nope, cant see the first parties being a burden for Sony.

 

 But then why don't MS go that route if it's really profitable?

And unlike a comparison to Nintendo, MS and Sony are very comparable in their gaming business - same size of console sales, same ambitions and target audience.

I think you're just hoping Sony's big budget titles are making money. But MS is one of the smartest software guys on the planet - if they saw there's money in having their own studios they would invest in it, not downsize.

I dont have to hope, if the numbers of this site are correct the first party games are making money. MS have kept Lionhead and Rare whom make games which sell, they know first party games are still important. Also Turn 10, the guys who make Forza have remained.

 

Making money doesn't equal profit. Last I checked vgchartz doesn't report the costs of developing a game. Sony's financial statements do though, and that...well....

 

 

Well yes I think VGChartz thinks too highly of people..........that they have brains. :/ You can make your own estimations about how much they are making from SOFTWARE sales with the knowledge that games like Uncharted cost $20 million.



 

ymeaga1n on 23 January 2009
NinjaKido said:
ymeaga1n said:
RPG said:
Slimebeast said:
RPG said:

 

Doubt that, pretty sure most if not all Sony's first party games have made profit. With that said the ones which will definitely sell well ala GT5, GOW III and KZ2 have not even released yet so nope, cant see the first parties being a burden for Sony.

 

 But then why don't MS go that route if it's really profitable?

And unlike a comparison to Nintendo, MS and Sony are very comparable in their gaming business - same size of console sales, same ambitions and target audience.

I think you're just hoping Sony's big budget titles are making money. But MS is one of the smartest software guys on the planet - if they saw there's money in having their own studios they would invest in it, not downsize.

I dont have to hope, if the numbers of this site are correct the first party games are making money. MS have kept Lionhead and Rare whom make games which sell, they know first party games are still important. Also Turn 10, the guys who make Forza have remained.

 

Making money doesn't equal profit. Last I checked vgchartz doesn't report the costs of developing a game. Sony's financial statements do though, and that...well....

 

Just because Sony isn't making a profit off the entire division doesn't mean 1st party titles aren't making a profit , there's plenty of factors to consider.

 

Agreed. But I think it's a further stretch to assume Sony is making profit on 1st party titles when they bleeding massive amounts of money company wide. 

 




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FinalEvangelion on 23 January 2009

Damn. MS is shutting down all the games I actually care about. I don't give two sh*ts about Gears and Halo. Tales of Vesperia has even been discontinued - the reason I bought a 360. Well, I am buying SO4 first day because that will probably follow a similar fate to 360/MS games I like.

Cry-On and Flight Simulator - that was pretty awesome.



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fulcizombie on 23 January 2009

Man sony has everything right these days, making so much profit ....



Slimebeast on 23 January 2009
RPG said:
Slimebeast said:
RPG said:
Slimebeast said: 

 But then why don't MS go that route if it's really profitable?

And unlike a comparison to Nintendo, MS and Sony are very comparable in their gaming business - same size of console sales, same ambitions and target audience.

I think you're just hoping Sony's big budget titles are making money. But MS is one of the smartest software guys on the planet - if they saw there's money in having their own studios they would invest in it, not downsize.

I dont have to hope, if the numbers of this site are correct the first party games are making money. MS have kept Lionhead and Rare whom make games which sell, they know first party games are still important. Also Turn 10, the guys who make Forza have remained.

 

You still don't know. Let me remind you that most game publishers have a very hard time making a steady profit of more than 5% - for example Ubisoft, EA, and Take Two - despite being multiplatform.

What conclusions you draw from this? Well, one must be that many games published by Ubisoft, EA, TT lost money.
(and another that video game developing is a very competitive market and hard to make money in)

Whenever you read publisher press-releases like "Assassin's Creed was a huge success, but games like Prince of Persia failed to meet expecations" it's very likely that PoP lost money. Or "Madden had impressive sales, but Mirrors Edge sold a lot less than EA had projected" it's very likely that Mirrors Edge lost money.

Now, these kind of games still sell in the millions. But they also cost a lot to develop.

So I can only imagine that new IP from Sony like Resistance, Uncharted, Motostorm, Lair and Heavenly Sword and games like Ratchet - games that sell on average less than 1.5 mill - lost a lot of money.

Btw, Rare is a bad example of proof that 1st party is beneficial. Rare is a disaster for MS, not just because it cost insane amunt of money to aquire, but because it's a big ass studio (300 guys or so?) who don't have a clue about what the market and gamers want. I bet MS would get rid of Rare tomorrow if anyone just wanted to buy them.

It also seems you dont have a clue about how first party games work. Sony recieve a much larger amount of money from first party games compared to 3rd party games, that is why they make back money so quickly. On GAF it was posted where the $60 go and for first party games they get a huge proportion of the money, at least half if memory serves.

3rd party devs get a much smaller return, they have to pay the console company the game is on, get a smaller amount back etc so of course they will need more sales. Even games which sell 1 million for first parties make Sony at least $30 million back, pretty sure that is more than enough to cover costs. And that is the bombas, resistance and uncharted sold well over 1 million.

 

That don't matter. Sony is the publisher and the developer, so of course they get more money than a dev gets from each copy of game sold. But for example in the case of Ubisoft you've got the same situation - Ubisoft is both publisher and developer.

And I already told you publishers tend to make 5% in profit at the most (xcept for Nintendo and Activision) - and actually EA and Take Two has lost money for years - why would the individial studios be any different? So it's pretty safe to say that the profits overall are small - thus releasing your games on a single platform, halving the sales, should mean a big loss in revenue while the games still cost as much as a multiplatform to develop.



Squilliam on 23 January 2009

Rare -> NXE avatars etc. Also seems to be a flexible studio but due to past performance I can see them pruned back a bit.

Turn 10 -> Forza is a significant series because not only does it sell games, it also sells peripherals like racing wheels which are extremely profitable. Also important as they are about the only racing developer even close to Polyphony, a good counter balance to GT. They also live in Redmond, and its harder to fire people you see every day now is it?

Lionhead Studios -> Their games always sell well, and theres always the chance that ol' Pete is gonna pull some brilliant sunshine out of his butt. Possible game changer, and the current sales of over 2M should see them through.

Wingnut -> Collaboration with Peter Jackson, cheap development costs (New Zealand) and producing their landmark series, will not be touched.







Tease.

theRepublic on 23 January 2009

I see some arguements about games and profitability, so I suggest you take a look at this link.

It says that only 4% of games that start production actually make a profit.  It goes on to say that 20% of games that make it to market will make a profit.

That means that making games is a very risky business.  Add the fact that developing games is a long and expensive process, and I can see why Microsoft would be a little worried about owning developers right now.



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