Pot Meet Kettle: Activision, the new Black
Bobby Kotick’s choice words for Sony sparked outrage amongst PS3 fans, and quickly became one of the most controversial subjects of the summer. The outspoken CEO suggested Activision would drop support for PlayStation if Sony didn’t lower the price point on the PlayStation 3. The glare of the corporate flames shine a light on what is actually a very bold statement, coming from a publisher responsible for some of this years most expensive video games. Basically Activision has a lot of nerve.
The PlayStation 3‘s biggest fault is it’s price. Especially in this global economic climate. Sony’s beautiful black beast, although not selling poorly, is clearly being held back because of it’s $399 price tag. This equates to a smaller installed base, which Kotick feels is holding back profits for publishers such as Activision.
Activision closed 2008 with over $344 million in net profit, and tallied over $2.9 billion in total revenue. Thanks to franchises like Call of Duty, Guitar Hero, and more Activision saw it’s 16th consecutive year of growth. So how does Activision plan to increase profits in 2009? By having some of the most expensively priced video game products on the market today.
The recent announcement of $149.99 priced Modern Warfare 2: Prestige Editon stuck out like a sore thumb after claiming Sony needed to lower it’s behemoth console. Other Activision franchises have shocked with their pricing strategy. Games like Tony Hawk’s Ride, which will literally take you for a ‘ride’ with it’s $119.99 price tag. Or DJ Hero, at the same $119.99 price, might have you ‘scratching’ your head, asking if it’s really worth the cost of 2 new games. Even though Guitar Hero World Tour does pack a whole band into the bundle, the $189.99 MSRP is still astronomical just to play one game.
Do the math, four of Activisions most profitable franchises would comes to a total of $579.96. While the “expensive” 80GB PlayStation 3 bundle (featuring Killzone 2, and MGS4) offers for just under $180 less. Without the streets there would be no cars, Activision needs the PlayStation 3 to “drive” sales of these expensive titles. Granted the Prestige Editon of Modern Warfare 2 is completely uncessary, even after removing that $149.99 from the equation the three remaining games values are about as expensive as the aforementioned PS3 bundle.
Activision needs Sony as much as Sony needs Activision. Both have some of gaming’s highest priced items. However Sony easily offers a much greater value in it’s PlayStation 3, than any combination of 3 Activision titles listed above. Maybe Activision should look into lowering it’s own prices, before calling the kettle black.
23 Responses to “Pot Meet Kettle: Activision, the new Black”
Great points! I agree.
i like what you did here sev. good article and great viewpoint.
Very nice! I love it.
I love this, at least with the PS3 you have a ton of replay ability…. While I have GHWT, I would never pay 149 for MW2 PE or 120 for TH or DJ….
So every PS3 is like the Prestige console, the Wii is the Hardened, and the Xbox 360 is the Regular?
I will take my Prestige PS3 any day over the others thank you very much.
CoD is their only valuable title.
I’d rather see who would hurt more (Act. or Sony), if Activision sold their garbage to only 360 owners.
thank you Sev. excellent article. i’m sure you know my thoughts on this subject. it just seems to me that ‘someone’ has grown too big for their briches. and that’s stating it mildly.
Calling out the Prestige Edition and whole band kit for Guitar Hero is pretty shitty, they’re not requiring you to buy the whole thing, I’d assume if you like Guitar Hero you would’ve gotten a guitar by now (or if you have taste, you would’ve got Rock Band instead).
And darkangel, seriously, do you have ANY idea how many games Activision puts out? Expand your horizon to cover more than just our exclusives, because when the holidays come around, nobody gives a shit or knows what inFamous is. It’s all about franchise games like Spiderman, Guitar Hero, Spyro the Dragon, Tony Hawk, or Call of Duty to name a few.
Yeah, Tony Hawk and Spyro have sucked ass, but kids have shitty taste. And saying Guitar Hero doesn’t matter? I hate the game, but come on, you can’t deny sales numbers! If those were only on 360, what parent in their right mind would purchase a PS3? I’m sure little 10 year old Jimmy will LOVE sophisticated games like Resistance 2 or Metal Gear Solid 4.
Nice write up, Sev.
if i remember correctly didn’t Sony account for the biggest percentage of activision’s 2008 profits?
it is intersting that one CORPERATION would bash another about its pricing. Activition shuld be working internally with Sony to lower its price. Not get into an ESPN style, war of the words in the media
Nothing more needs to be said after that read.
Great article, I never thought of it from that perspective.
and also, Why the Star Trek picture? haha
@TimPV3:
It doesn’t matter if you are not forced to buy the bundles. Activision is still charging that much for a game and people are still buying them. You have to look at the big picture.
Hmmm, maybe I just missed something, but isn’t the PS3 bundle actually $180 cheaper not $80?
2 things:
1. TimPV3 needs to calm down and re-read the article for what it was intended to be read for
2. I love all of the puns in this article; makes it fun to read
Great article Sev. I am really liking all the editorials you guys have been doing lately.
Please keep’em coming.
Tim, sorry… guess Im a gamer snob but the activison line up over the last several years has just been crap. GH isnt big because it is good, it is big because HMX made it and Activision took it over and flooded the market with it. Rock Band puts GH to shame
There are enough shooters on the market at this point that CoD really is just a name rather than a quality game. I havent seen a new game that impressed me since True Crime, LA (in 2003). Speaking of which, they have just been re writing COD, GH and Tony Hawk over and over again for the last 6 or so years. Way to work hard huh?
“which will literally take you for a ‘ride’ with it’s $119.99 price tag. Or DJ Hero, at the same $119.99 price, might have you ’scratching’ your head”
come on…
All I have to say… is… Crappyvision needs Sony WAY more than Sony needs Craptivision. Sure it will be a hit on Sony’s software sales, but ya know what? That just means less competition for games like Killzone 2, Resistance 2, and companies like EA and others are capable enough.
I mean Skate is doing well, Rock Band 2 would dominate if they would treat Europe and Australia nicer, Burnout Paradise has been a game changing (literally) experience, as well as a HUGE change in game marketing. I don’t care about Modern Warfare 2. There are people who would LOVE a game like M.A.G. or klilzone but are so obsessed with Call of Duty, Socom, or Halo, that they just won’t give a title time to work it’s magic.
Give me 1 game Sony can’t live without. Prototype just eats up a few sales from people who got off on the wrong foot with Infamous. I could go on. I would rather do without Craptivision. It’d make boycotting them so much easier. Cause then I wouldn’t even have to look at game labels anymore.
[...] everyone had salaries like Mr. Kotick, CEO of Activision, then we could afford the astronomical prices Activision charges for their games. But this is [...]
[...] and his plethora of unprecedentedly ludicrous public statements concerning Sony, his staff, and Activision supporters, but this was only the start of their [...]