I have a serious & significant question now:
Sony is spending a HEAP on developing these "big" titles - 20m plus on some titles (no idea what HS costs). How will these sales figures impact what they are doing?
Can these titles be "long-term" titles, and drive sales for a year (or two) in the future? Can they use the tech from these titles as a basis for future titles - and release improved sequels or even more IPs?
Can they afford to stick with this route?
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Out of LAIR, HS, Warhawk, Folklore - I would say Warhawk is closest to breaking even. It is also selling on PSN, so probably has raked in a lot more revenue than we know of.
Folklore has been a strong commercial failure - it has sold under 100k WW (?) to date. Even at $30US profit per unit - that makes $3m to cover development, marketing, production. I would estimate its costs at $12m-$15m?
HS has at least sold some units in the US, and will probably crack 500k WW. At $30US, this should reach $15m WW. This probably won't cover development and marketing (any figures anyway?), but may get close.
LAIR has been the worst, and for good reason Sony is not pushing the title internally. It may struggle to reach 300k WW. At $30US, that makes a paultry $10m revenue - for a title that reportedly cost more than $20m alone to develop.
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A simple comparison is against MP8 (Mario Party on the Wii). It will have sold close to 3m units by the end of the year. Nintendo may be making $25US / unit (this may be a lot higher), reaping $80m US (+).
By constrast, the game probably cost around $5m-$6m to make, and maybe another $5m to advertise/market. That's enough profit to fund the development of all these big Sony titles - at once.
It may be too late for Sony - but is Ninty's strategy of cheaper/casual development the right one? Is it worth doing this to fill in the coffers, and THEN use some of this money to fund the riskier big-budget titles?
(sorry to all - this is sort of off-topic :P)