Sunday, June 21, 2009

Well, That’s Pretty Damned Serious.

I don't know if this is just the internet being seriously out of proportion and context, but apparently Activision (the number one game publisher in the world), is pulling their weight around, and saying that it would consider to drop support for the PS3 and the PSP if the prices aren't dropped soon. Some comments I've come across are mixed. Some are saying "GTFO Activision", as many feel that their reputation is extremely damaged, due to a yearly franchise release policy, overpriced plastic toys necessary to play many of those games, and incremental upgrades to them as well. Others are saying that they won't actually desert Sony, it is just a bluff.

I must say that my position on it is that Sony should take this seriously. Sure it's all about profit in the end, and that's why this is happening in the first place. But it's probably more serious than most people are taking it.

Exclusivity happens all the time in the Entertainment Software Industry. Games come out for certain systems, or gain exclusive content all the time, and it's boggling to see how so many people don't think this is a big deal to Sony. I think of it like this:

  • Microsoft's game plan is solid. Activision has plenty of reason to choose sides with them primarily.
    • They have the cheapest "next-gen" system in the Xbox 360 Arcade, which sets the entry barrier low for many people, and essentially gives Microsoft a way to seriously take advantage of those people by making them pay extremely ridiculous prices for more hardware and Xbox Live pricing. It's the "T-mobile" plan honestly. What seems like a little will actually turn out to be a whole lot when you want more.
    • They pay for exclusivity to big name titles all the time, and in many cases, like with Valve, the developers don't really mind the exclusivity at all, since the workload is easier and the Return of Investment is usually high.
    • With the way that the 360's interface is designed for advertising, it means that Microsoft has given publishers a chance to step into the limelight with their projects, even if it would be an otherwise unknown title. Every day that someone signs on to Xbox Live, is a chance to sell a product for the 360.
    • Microsoft knows what sells. An exclusive contract for millions of dollars sounds like a lot, in the short term. But when people see that a product they want will only come through one venue, they flock there, and have no qualms about it. Ask Apple and AT&T. That turns into extreme amounts of sales for those involved.
  • When EA's franchises were number 1, and Sega didn't have them to back them up in the Dreamcast and the Saturn, Sales of those console showed. Most people have recognized that Sega killed the Dreamcast in major part due to lack of many 3rd party publishers including EA. With Activision doing what they do, Sony does not need yet another major reason for people to not buy the system.
  • Activision will not have a problem surviving without Sony. They have hardcore and casual titles in the DJ/Guitar Hero games, Tony Hawk, Call of Duty, and Spiderman plus they have World of Warcraft, which continues to bring in massive cashflow. Tony Hawk and the Hero games now also will require new controllers, with games coming out very expensive and still sell tons. Even without the Vivendi Universal buyout, they could have still skyrocketed to number one eventually.
  • The CEO of Activision is a straight up businessman. Doesn't even like games. Typical model of that guy in a business suit. "The Man", so to speak. He won't see a problem dropping Sony.
  • With Windows holding the marketshare it does on the Personal Computer, Games (until very recently) didn't really have a place in other Operating Systems. That kind of shift is something that could be expected, and considering the amount of money Sony has put into their more modern platforms, they don't want to see it crumble to that level.
  • Nintendo and Sony's PS2 may not have the most active userbase, but the extremely large userbase in general gives plenty of opportunity for uninformed sales. To the Walmart mom, there is no difference in a 360 or PS2 version of Guitar Hero, and that's where it sells.

So yes, I do believe that Sony should take it very seriously. It will be worth it in the long run, seeing as the result of this price drop will drive more sales of the PS3 anyway, and Activision's mega titles will still be a major part of the Playstation Equation. I don't really know how far this will go, but I would never be surprised that Activision will do what it says. We'll see how this will turn out.