Ubisoft announces 19% increase in sales

French publisher Ubisoft has reported a 19% increase in net sales and an “excellent” outlook for the second half of the fiscal year, ending March of 2006.

The report showed that the company still lost €11 million ($13 million) the first half of the 2005-2006 fiscal year, an improvement from a €33 million ($39 million) loss for the same time last fiscal year. “Ubisoft saw progress in all of its performance indicators and is today a major player in the videogame industry,” said Yves Guillemot, CEO of Ubisoft. “Indeed, already second largest independent editor in Europe, Ubisoft joined the top six in the USA, and ranks even in the top five on consoles, as it continues to gain market shares. This trend is expected to prevail in the second half of the year: with major game launches scheduled, fiscal year 2005-2006 could well be an outstanding year.” Gross profit was also up 5.2 percent, from €73 million ($86 million) to €95 million ($112 million). The company credited releases such as Rainbow Six: Lockdown, Brothers in Arms: Earned in Blood and Far Cry: Instincts with increases in sales and profits. The recent release of Peter Jackson’s King Kong and Prince of Persia: The Two Thrones is expected to play a significant role in the second half of the fiscal year. The statement also included an up-to-date release list, with a few new titles surfacing: WWII flight game Blazing Angels for Xbox 360, Brothers in Arms for the PSP and an unannounced Xbox 360 title. more @ next-gen.biz

Pixel-Lab interviewed by BBC about Bully

I was asked to participate in the BBC’s Politics show last week. It featured a discussion about Rockstar’s Bully.

Broadcast on the Sunday before Xmas it featured Dave Doak, FRD, myself, Roger Bennett, ELSPA, and Keith Vaz MP. It centered around the danger of Bully falling into the wrong hands and the game becoming damaging to the work by anti bullying groups. The industry argues that a product cannot be banned before it has been seen, as Bully hasn’t been seen by anyone yet.

The piece was quite well balanced, but I looked fat, tired and shabby (what do you expect of a new dad)

You can see more here.

EA buys Jamdat for $680m

Electronic Arts has been poking around the mobile games industry for a couple of years, but finally the company has committed in typically extravagant fashion – by putting in a successful $680m bid for US mobile content publisher and developer, Jamdat. You can get the full financial story here but, in brief, EA is paying $27 per share for its latest acquisition and plans to publish around 50 mobile titles in the year following the deal.

Jamdat is, by mobile gaming standards, an industry veteran, formed back in March 2000 by two ex-Activision execs, Scott Lahman and Zack Norman. It’s certainly one of the key publishers in the global business holding licenses to Tetris, Lord of the Rings, SOCOM, Tony Hawk’s and Doom among others. Hmm, what will happen to all those Activision IPs now?

Another question is, where does this leave I-play, the UK mobile publisher that entered into a strategic partnership with EA last year and has co-published and distributed a number of key EA licenses such as Tiger Woods, FIFA and The Sims.

2005 News Round Up: Take Two

“Through December, Next Generation is running a series of features looking at how leading publishers fared in 2005, including the highlights and lowlights.”

• Grand Theft Auto, was found to featured hidden sexual content. The game was pulled, reclassified, and became the subject of an FTC investigation, a class action lawsuit, untold lost dollars and gallons of media airtime. In short Take-Two became the focal point of the industry’s reputation for playing fast and loose. It may well be that, in a year of three hardware launches, this episode will be remembered as the most significant of the year.
• Take Two were involved in deals for big brands like Charlie And The Chocolate Factory, The Warriors, Prey, 24, The Olympics, The Elder Scrolls IV: Oblivion, The Da Vinci Code, and Serious Sam.
• Firaxis Games, home of industry icon Sid Meier, was picked along with its Civilization franchise. 2K Games had already been a partner to Firaxis in the marketing and release of Pirates and Civilization IV. The company also bought Sega’s sports studio Visual Concepts and its subsidiary Kush Games.
• Possibly the biggest deal of the year was the pick-up of exclusive third-party publishing rights to MLB, pushing rivals like EA out to lesser licenses. The seven-year deal does not exclude hardware manufacturers from the market. Take-Two ended its association with ESPN following EA’s deal with the broadcast label.
• Delays of key product out of the main selling season are one of those recurring nightmares for game publishers. Take-Two was forced to recalibrate its financial outlook (downwards) following the delay of Elder Scrolls IV, PSP GTA in Europe and GTA PS2 in Japan.
• The company’s Rockstar label likes to see itself as edgy and macho. In an interview with the New York Times the company’s Sam House explained, “As a grown man, I find playing with an elf a little bit demeaning. We’re into gangster movies, car chases, ‘The Warriors,’ westerns and lots of other things. But we’re not expert in space or science-fiction or elves, and so we couldn’t do that well. It wouldn’t be fun for me to work on that stuff. And if we can’t have fun doing it, then the sheer amount of work that goes into making one of these games and the hideous hours that we have to work would be like being in prison.”

more @ Next-gen.biz

2005 News Round Up – Activision

“Through December, Next Generation is running a series of features looking at how leading publishers fared in 2005, including the highlights and lowlights.”

• Activision extended its Spider-Man deal, and held Dreamworks into a 12-year agreement, covering the likes of Shrek and Bee Movie.
• In the last year, Activision bought Vicarious Visions, best known for its handheld expertise, kids games specialist Toys For Bob and Quebec-based Beenox.
• Activision’s year ending March brought in record revenues of $1.4 billion, 50% higher than the previous year. Profits came in at $138 million. Bobby Kotick said, “We delivered the highest net revenues, operating margin and earnings in the company’s history.” It’s doubtful that achievement will be repeated this March.
• Clearly identifying a new revenue stream, Activision has been one of the main proponents of in-game advertising, working with research outfit Nielsen to talk-up the sector’s potential.
• Bobby Kotick branded Take-Two’s budget-priced ESPN sports titles as “irresponsible” and “disruptive” and predicted way back in January that game prices for the next generation would be up $10. He added, “We haven’t raised prices as an industry in 20 years. Look at the movie business as an analogy. You’re not getting any more hours of entertainment — it’s the same two hours of a motion picture — and yet you’re spending twice as much as you did 10 years ago.”

more at next-gen.biz

Sony Purchase Guerilla Games

Sony Computer Entertainment World Wide Studios has officially brought Killzone developer Guerrilla Games. Sony announced its acquisition of Amsterdam-based Guerrilla Games, developers of the Killzone franchise and its next-generation PS3 iteration. The two companies already had a strong working relationship, as an exclusive development agreement was already in effect since March of last year.

Phil Harrison, president of SCE WWS, said, “As we prepare for the launch of PlayStation 3 next year, this acquisition strengthens our development portfolio to take full advantage of the exciting entertainment opportunities provided by PSP, PlayStation 3 and beyond.”

The statement also mentioned that a Killzone PSP title is in the works.
credit:Next-gen.biz

2005 News Round Up – EA

“Through December, Next Generation is running a series of features looking at how leading publishers fared in 2005, including the highlights and lowlights.”

Electonic Arts

• Responding to an attack on its turf from Take-Two, EA got serious in the sports market.
• EA also added to its portfolio of international development subsidiaries, picking up Digital Illusions in January, and along with it, the Battlefield series.
• The firm also tied up a distribution deal with Valve.
• EA picked up 20% of its growing French rival, (Ubisoft)
• This year, the company finally got serious about mobile. Mobile games in the works include Madden NFL, The Sims 2, Need for Speed Underground, Tiger Woods and FIFA. Deals were struck with Verizon Wireless and Sprint.
• At the end of its financial year, EA managed to break through the $3 billion revenues mark with profits of $500 million, but its Q4 wasn’t hot.
• Steven Spielberg agreed to collaborate on the making of three original franchise games via the EA’s Los Angeles studio.
• A … new International HQ in Geneva, Switzerland was announced. The company was seeking to move many key roles from its UK office, to a more central position in continental Europe.
• Gaming’s most aggressive collector of AAA IP picked up next generation game rights to The Simpsons. A game based on Superman was also announced.

Taken from Colin Campbell’s piece at Next-Gen.biz
read more here

Analysits predict Zero Growth for 2005

WMS has issued its preview of NPD’s TRSTS report, estimating a poor November for the industry. The analyst has forecast sales of $715 million, down 16% over last year. It has also downgraded its full-year estimate from 6% growth to zero growth.

NPD’s final stats are due Thursday, December 8. WMS’ numbers are an estimation based on a much smaller sample group than NPD’s. However, they appear to confirm a general feeling in the industry that the peak Holiday season is starting late, and may not gather the hoped for momentum.

November 2004 saw sales of $849 million, driven by strong initial sell-through of Microsoft’s Halo 2 and continued strong sales of Take-Two’s Grand Theft Auto: San Andreas, which accounted for approximately 20% and 9% of last year’s sales respectively.

This year’s big releases have been Activisions’ Call of Duty 2 Big Red One, THQ’s WWE Smackdown vs. Raw 2006, Electronic Arts’ Need for Speed Most Wanted, and LucasArts’ Star Wars Battlefront 2. Continuing to shine are Madden NFL 06 and NBA Live 06, Sony’s SOCOM III, and Take-Two’s Grand Theft Auto Liberty City Stories.

The company is still sticking to its view that the market will correct itself by the end of the year, but says that its previous estimate of 6% growth is now too high. A statement read, “Our most recent forecast predicted U.S. console and PC software sales growth of 6% for 2005, and we now acknowledge that our forecast is too high in light of the weaker than expected October and likely weak November sell-through data. On balance, we now expect sales for 2005 to be flat to slightly positive.” The firm says it will issue a formal forecast after NPD’s stats are available.

WMS has repeated its view that the market has been hurt by a lack of exciting new releases. “We remain concerned that consumers are uninspired by the sequel-driven slate of new games released this quarter,” said the firm.

Publisher’s individual stats do not make for especially pleasant reading. Take-Two with revenues of $30 million, will be down 70% over last

year. THQ ($40 million) is down 44%. Electronic Arts ($125 million) is down 6%. Activision ($65 million), Atari ($25 million) and Midway ($12 million) are all up slightly year-on-year.

How can we improve Hardware Transitions?

Earlier this year, there were some in the industry who said that moving from one console generation to another has become as easy as stepping over puddles. They were wrong.

Earlier in the year, many were confidently predicting that we had it all figured out. Hard experience would help us through this console transition, in ways we hadn’t managed before.

Now, it’s become clear that sales of now generation games have not been as strong as many had hoped. While analysts say that overall sales will be up year-on-year, that is still dependent on a very strong December.

Also, the market has been helped by the launch of two handheld devices, effectively creating a new market within a market. But even those have failed to deliver much in the way of overall growth.

Retailers and publishers have been stepping forward in recent weeks, admitting that the ‘environment’ (read: game sales) has been weaker than anticipated.

This year we have seen few genuinely grandstand titles that have whipped up media and retail interest. Instead, most of the media’s attention has been spent on products that don’t exist – PlayStation 3 and Xbox 360. (Of course Xbox 360 does exist but, as far as third party publishers are concerned, it’s not going to butter any parsnips this year. The numbers are too small and will likely continue to be so well onto next year.)

It hasn’t helped that the industry has largely failed to create any genuinely remarkable games for either the now or the next generation. Looking back at E3, it’s difficult to match the games we thought looked great, with serious retail movement. Perhaps King Kong is the exception.

I just popped over to Gamerankings to look at the most popular games. There are only five PS2 titles in the top 20 – 50 Cent Bulletproof (widely regarded as crap), Dragon Quest VIII (well reviewed but hardly a U.S. retail monster), True Crime New York City (another weak release) plus two franchise releases – a THQ wrestler and Need for Speed. Both these games are well made and will sell well, but it bodes ill for the industry if they represent the future of our business.

Investors are looking at games publishers and retailers and what they are seeing is a familiar picture of over-promising and under-delivering. It’s not that individual publishers have messed up, (although few have distinguished themselves). It’s more that we, as a business, have largely failed to excite our audience this year, with the products that are actually going to make a difference to the bottom line.

We saw the lines last week for Xbox 360; we saw the disappointed consumers, and with them the picture of a missed opportunity; how many of those 18 Xbox 360 games will hit forecasts now? And with consumers now fixated on the next generation, how many PS2 and Xbox games will under-perform as a result?

The fact is that, although we’ve learned a great deal about console transitions, we are a long way away from managing them faultlessly. They remain wide, difficult and treacherous crossings. And we’re a long way from getting across this one safely.

BBC Research: UK Gamers

BBC Research commissioned a UK study of gaming in the media context. BBC News got a preview, and have done a little snapshot of the major headlines; the big paper bit is being laid out and subbed. Probably another week or so in the works.

To understand how games fit into people’s everyday lives, the BBC carried out extensive research commissioned by BBC Audience Research, New Media, as part of a wider Creative Research & Development study.

Some of the more interesting facts:

• The project profiled UK gamers and non-gamers from 6 to 65 and found that almost 60% played games.
• Of those, 48% are women and 100% of 6 to 10-year-olds play games.
• The average age of the UK gamer is 28, perhaps much higher that one might expect.
• Unsurprisingly, those born in the 90s do not know life without games.
• Perhaps more unexpectedly, 51% of the 36 to 50s play games, and the figures are still rising.
• Across all age groups, 48% of gamers are female. The biggest gender gap is in the 36 to 50 age group, but the gap is only 10%
• Most of the UK’s gamers – especially those under 35 – play on consoles, such as the Xbox, PS2 or GameCube. PCs dominates for the over-35s.
• Across the ages, web-based games are popular, with both males and females. Mobiles and handhelds proved big with younger groups.
• Gamers are more likely to have digital TV, broadband and other technologies in the home; 37% of 16 to 24-year-old gamers download TV and films from the net already.

thanks to Alice Taylor at Wonderland