Cliffy B Describes Games Industry's "State of Turmoil"

[Zombie_Moogle]

Why are there so many people here with absolute confidence in Nintendo?
Historically, Nintendo has been pretty hit'n'miss with it's consoles. Did everyone throw Nintendo this much support when they were pushing the GameCube? No one bought the 3DS until they slashed the price, & I don't think I need to remind people of the Virtual Boy.
Not sure I agree 100% with Cliffy on this topic, but it's not unheard of for a Nintendo gimmick to crash & burn

 

[FFP2]

I love how this has turned into a console war. I doubt that any of the big three will die off anytime soon.

OT: The dude is right, there haven't really been any AAA games that can be called "one of the greatest games of all time". I'm not saying that all current gen games are shit, I'm just irritated at how safe devs are playing it these days and I just feel that the gaming industry has lost it's "charm".

 

[AzrealMaximillion]

Well since you didn't believe me here is an article about it. I used google because I didn't feel like using the escapist search bar even though I know they published the same article.

http://www.techradar.com/us/news/gaming/consoles/wii-u-only-needs-to-sell-one-game-per-system-to-make-a-profit-1115427

But of a problem with this link. It was written less than a week after the Wii U was released, back when Nintendo had higher sales expectations and when Rayman Legends and a couple of other games were exclusives/going to be released shortly after launch. It also comes from the vein of "Reggie Fils-Aime said it", which is borderline believable at this point, considering there are 2 Wii U models and no way to tell that a single game offsets the Wii U losses. There's too many variables to that statement such as the fact that Nintendo also loses money for handing out copies of Nintendo Land in bundles, and that Not everyone who owns a Wii U has Super Mario Bros U (only thirds, while still damn high, not enough to cover the losses with current sales as they are). And also as I said, the Wii U has no competitors at the moment.

Also Microsoft in no way came in 3rd considering it outperformed the Ps3 (as much as I love it) sales wise not only in the console consistently but they made bank through xbox live. In 2012 there were over 40 million users registered in xbox live gold accounts. Even if it is only 40 million over a period of time that is some strong bank that was for over 6 years. The kinect while I think is useless sold something like 24 million units while the PS move hit like 15 million.

http://www.engadget.com/2012/11/16/playstation-3-sales-70-million-units/

http://www.eurogamer.net/articles/2013-02-12-xbox-360-worldwide-sales-top-76-million


http://www.tgdaily.com/games-and-entertainment-brief/60687-xbox-live-users-topple-40-million

This point is diffused by that article posted on the Escapist stating that the PS3 has officially shipped more consoles than the 360, and that was a month ago. Also counting the fact that the 360's RROD problems did force a large amount of people to buy another one, the 360 is in third place to be honest. It will be at the end of this generation for sure. As it stands now, the great majority of exclusive games on the 360 were ported over to the PS3 and PC, that will impact current sales in a very big way.

Also your theory about saying that sony beat them 2-3 generations ago is not applicable I am afraid. This current console generation Sony was the one that got dominated by both parties and a few scandals (linux removal, hack attack bringing PSN down for a MONTH). The Wii while my least used console still broke records for the first 4 years of console sales and except for the last 1.5 years of this console cycle has dominated and made profit per system sold.

Sorry, but the RROD scandal and the E74 scandal alone effected the 360 in a much bigger way that the PS3's scandals. Both of the 360 scandals made the console inoperable, same can't be said about the PS3. And the Wii, while it broke records for the first 4 years of its release also stopped selling well if at all at about the same time. Wii sales slowed down in a very steep way. That's what happens when the gimmick wears off. It also explains why the tablet controller its drawing people to the Wii U in the same way as the Wii's motion control. People by and large don't want gimmicks.

There is no statistical proof you can provide that would suggest that Sony is not in the most trouble compared to Microsoft and Nintendo. When you have to sell an HQ to keep out of the red, you are in big trouble.

http://www.nypost.com/p/news/business/sony_sells_hq_bldg_for_iqeTsssvfEcW3D033MzLCL

Also I love my vita and especially persona 4 golden but it has also underperformed massively and isn't helping Sony right now.

All in all said I love my Ps3 but I am not blind to what is really going on.

Yeah, there's a lot of proof to show that Sony isn't the only one in trouble. The fact that the 360 spent the majority of this generation losing Microsoft money is a big one. The fact that it has next to no exclusive franchises to go into the next generation with. The fact that we have no idea what the next Xbox will bring while Sony is to release the PS4 this year. I don't need statistical proof when there are major factors effecting MS and Nintendo that aren't represented in statistics. Nintendo loses money on every Wii U and 3DS sold, their third party reputation is almost mirroring Sega's in they days when Sega made consoles. Not to mention that Sony and MS's gaming businesses are just part of big corporations while Nintendo IS a gaming corporation.

Don't be naive and think that only Sony's stand in the console game is in trouble here. All 3 are in trouble for different reasons. This upcoming generation is the one that will most likely see one of them fall, and to be honest, the thread that holds the Sword of Damocles above Microsoft's console franchise is the one that seems to be splitting the most.

 

[AzrealMaximillion]

Because, again, a few games selling well doesn't save a company from bad profits. Nintendo is selling the Wii U at a loss right now (for the first tme in a while) with 3 million units actually sold. Super Mario Brothers U is the ONLY game to sell that well on the Wii U. Why? There's nothing else to buy on it with that appeal. There's also a long wait before anything worth looking at on the Wii U is coming out. Nintendo can't rely on one Mario game to make up the losses.

It's only a loss for the 8 gig model, and it makes that loss back with ONE single game sale. Nintendo is Ultra Conservative and masters of making consoles make money even if they "lose" the war. Only Nintedno can get this kind of a head line "Nintendo [http://www.google.com/hostednews/afp/article/ALeqM5j134LCcyCG3HkAatvCIyhETMpskA?docId=CNG.3635386fb91e249bdbefa9c459b6b22c.6c1] boosts profit forecast, cuts Wii U sales target". How do you INCREASE your profit forecast when each unit sold is at a loss. The only way is to be making a profit on each unit sold. If you take the 3 Nintendo published games on the Wii U (Mario, Nintendo Land, ZombiU) it comes to 3.5 million games. That vastly exceeds Nintendos minimum for profitability of the system.

A lot of what you said doesn't make any sense. How is the 8 gig model selling at a loss while the 32 G model isn't? Nintendo Land is bundled so those sales don't count for profit, if anything that would bump up losses. ZombiU is also bundled so that's another loss factor, and ZombiU didn't sell that well and wasn't that good. It sounds like you're pulling a lot of what you said out of thin air.

Also, in your link while it does say that the Wii U may boost profit, it also points out that the 3DS is losing Nintendo a lot of money, that the profit boosts are due to a weak yen, and that Nintendo said they would be at an operating loss this year.

Should've read the article.

 

[AzrealMaximillion]

Why are there so many people here with absolute confidence in Nintendo?
Historically, Nintendo has been pretty hit'n'miss with it's consoles. Did everyone throw Nintendo this much support when they were pushing the GameCube? No one bought the 3DS until they slashed the price, & I don't think I need to remind people of the Virtual Boy.
Not sure I agree 100% with Cliffy on this topic, but it's not unheard of for a Nintendo gimmick to crash & burn

People only look at articles showing Nintendo's business in a positive light and seem to ignore all the articles that show the Wii U and 3DS are actually losing them quite a bit of money. I had a Nintendo fan link me this article [link]http://www.google.com/hostednews/afp/article/ALeqM5j134LCcyCG3HkAatvCIyhETMpskA?docId=CNG.3635386fb91e249bdbefa9c459b6b22c.6c1[/link]

They read the headline and thought Nintendo was going to do awesome. I read the article itself and found that Nintendo predicts to be posting another year of operating at a loss.

I guess the "success" of the Wii has some people in a cocaine like high where they only see Nintendo as the king and forget that the console crown hadn't been on Nintendo for a good long time before that.

 

[medv4380]

Because, again, a few games selling well doesn't save a company from bad profits. Nintendo is selling the Wii U at a loss right now (for the first tme in a while) with 3 million units actually sold. Super Mario Brothers U is the ONLY game to sell that well on the Wii U. Why? There's nothing else to buy on it with that appeal. There's also a long wait before anything worth looking at on the Wii U is coming out. Nintendo can't rely on one Mario game to make up the losses.

It's only a loss for the 8 gig model, and it makes that loss back with ONE single game sale. Nintendo is Ultra Conservative and masters of making consoles make money even if they "lose" the war. Only Nintedno can get this kind of a head line "Nintendo [http://www.google.com/hostednews/afp/article/ALeqM5j134LCcyCG3HkAatvCIyhETMpskA?docId=CNG.3635386fb91e249bdbefa9c459b6b22c.6c1] boosts profit forecast, cuts Wii U sales target". How do you INCREASE your profit forecast when each unit sold is at a loss. The only way is to be making a profit on each unit sold. If you take the 3 Nintendo published games on the Wii U (Mario, Nintendo Land, ZombiU) it comes to 3.5 million games. That vastly exceeds Nintendos minimum for profitability of the system.

A lot of what you said doesn't make any sense. How is the 8 gig model selling at a loss while the 32 G model isn't? Nintendo Land is bundled so those sales don't count for profit, if anything that would bump up losses. ZombiU is also bundled so that's another loss factor, and ZombiU didn't sell that well and wasn't that good. It sounds like you're pulling a lot of what you said out of thin air.

Also, in your link while it does say that the Wii U may boost profit, it also points out that the 3DS is losing Nintendo a lot of money, that the profit boosts are due to a weak yen, and that Nintendo said they would be at an operating loss this year.

Should've read the article.

The price of the 8 Gigs of Memory is about 10 Bucks retail.
The price of 32 Gigs of the same type of memory is about 25 bucks retail.
Both of those are sold at a profit. Nintendo gets them for much less because they buy in bulk.
The 8 Gig model sells for 300 and 32 gig sells for 350. You think Nintendo doesn't make a profit off of increasing the price by 50$ to give you 15 bucks in additional parts? You think Nintendo Land only is profitable if it sells at Full Price? You're crazy if you think that. The 32 gig model adds about 50$ to the price for about maybe 20$ worth of parts and product.

You should have actually understood the article I linked too. You clearly read it, but didn't understand.

If you were right and Nintendo was Bleeding money selling and making the Wii U then why did they make a Profit? Why with lowing their forecast for units sold which they already made are they making a profit? Why would selling fewer units then anticipated and with units you already paid for with production, and still make a profit? The value of the yen is the only thing causing it to continue to go up even after the last 3 revisions of sales. The truth is that Nintendo isn't taking a full 60$ loss on the Wii U 8 gig model. It might be 20$ possible 30$. They make money on EVERY game sale and they make the most on their own published titles which gives them almost 2 Nintendo Published games sold for each system. If you were right they should be well into the Red and they aren't even close.

In the history of Nintendo they've only had 1 year where they had a loss. And that required a Tsunami in Japan, Taiwan Floods Jacking up prices, The Yen going in the Opposite direction it is now, an over priced 3DS, and yea they had a loss that year out of the past 30 years of profit. For a hundred year old company they're good and figuring out how to make a profit when no one else seems to be able to find one.

 

[GAunderrated]

Well since you didn't believe me here is an article about it. I used google because I didn't feel like using the escapist search bar even though I know they published the same article.

http://www.techradar.com/us/news/gaming/consoles/wii-u-only-needs-to-sell-one-game-per-system-to-make-a-profit-1115427

But of a problem with this link. It was written less than a week after the Wii U was released, back when Nintendo had higher sales expectations and when Rayman Legends and a couple of other games were exclusives/going to be released shortly after launch. It also comes from the vein of "Reggie Fils-Aime said it", which is borderline believable at this point, considering there are 2 Wii U models and no way to tell that a single game offsets the Wii U losses. There's too many variables to that statement such as the fact that Nintendo also loses money for handing out copies of Nintendo Land in bundles, and that Not everyone who owns a Wii U has Super Mario Bros U (only thirds, while still damn high, not enough to cover the losses with current sales as they are). And also as I said, the Wii U has no competitors at the moment.

Also Microsoft in no way came in 3rd considering it outperformed the Ps3 (as much as I love it) sales wise not only in the console consistently but they made bank through xbox live. In 2012 there were over 40 million users registered in xbox live gold accounts. Even if it is only 40 million over a period of time that is some strong bank that was for over 6 years. The kinect while I think is useless sold something like 24 million units while the PS move hit like 15 million.

http://www.engadget.com/2012/11/16/playstation-3-sales-70-million-units/

http://www.eurogamer.net/articles/2013-02-12-xbox-360-worldwide-sales-top-76-million


http://www.tgdaily.com/games-and-entertainment-brief/60687-xbox-live-users-topple-40-million

This point is diffused by that article posted on the Escapist stating that the PS3 has officially shipped more consoles than the 360, and that was a month ago. Also counting the fact that the 360's RROD problems did force a large amount of people to buy another one, the 360 is in third place to be honest. It will be at the end of this generation for sure. As it stands now, the great majority of exclusive games on the 360 were ported over to the PS3 and PC, that will impact current sales in a very big way.

Also your theory about saying that sony beat them 2-3 generations ago is not applicable I am afraid. This current console generation Sony was the one that got dominated by both parties and a few scandals (linux removal, hack attack bringing PSN down for a MONTH). The Wii while my least used console still broke records for the first 4 years of console sales and except for the last 1.5 years of this console cycle has dominated and made profit per system sold.

Sorry, but the RROD scandal and the E74 scandal alone effected the 360 in a much bigger way that the PS3's scandals. Both of the 360 scandals made the console inoperable, same can't be said about the PS3. And the Wii, while it broke records for the first 4 years of its release also stopped selling well if at all at about the same time. Wii sales slowed down in a very steep way. That's what happens when the gimmick wears off. It also explains why the tablet controller its drawing people to the Wii U in the same way as the Wii's motion control. People by and large don't want gimmicks.

There is no statistical proof you can provide that would suggest that Sony is not in the most trouble compared to Microsoft and Nintendo. When you have to sell an HQ to keep out of the red, you are in big trouble.

http://www.nypost.com/p/news/business/sony_sells_hq_bldg_for_iqeTsssvfEcW3D033MzLCL

Also I love my vita and especially persona 4 golden but it has also underperformed massively and isn't helping Sony right now.

All in all said I love my Ps3 but I am not blind to what is really going on.

Yeah, there's a lot of proof to show that Sony isn't the only one in trouble. The fact that the 360 spent the majority of this generation losing Microsoft money is a big one. The fact that it has next to no exclusive franchises to go into the next generation with. The fact that we have no idea what the next Xbox will bring while Sony is to release the PS4 this year. I don't need statistical proof when there are major factors effecting MS and Nintendo that aren't represented in statistics. Nintendo loses money on every Wii U and 3DS sold, their third party reputation is almost mirroring Sega's in they days when Sega made consoles. Not to mention that Sony and MS's gaming businesses are just part of big corporations while Nintendo IS a gaming corporation.

Don't be naive and think that only Sony's stand in the console game is in trouble here. All 3 are in trouble for different reasons. This upcoming generation is the one that will most likely see one of them fall, and to be honest, the thread that holds the Sword of Damocles above Microsoft's console franchise is the one that seems to be splitting the most.

I'm sorry mate but I am not going to engage in conversation about this anymore. Not because you are a troll or anything but because you back up my articles and actual STATISTICAL DATA with conjecture and opinions that have no proof behind it.

I know it is a common thing to just spout off random things you have heard without proof but in real intellectual debates people tend to have proof backing up what they claim. Please continue this conversation with me once you get some.

-under

 

[Lunar Templar]

oh look -.- the 'Michel Bay' of video games said something again. fantastic ....

 

[xPixelatedx]

Did everyone throw Nintendo this much support when they were pushing the GameCube? No one bought the 3DS until they slashed the price, & I don't think I need to remind people of the Virtual Boy.

I did support Nintendo when they made the gamecube. In the rare instance a game was multi-platform, I always chose the gamecube version because F*** YEAH no loading times! XD It may not have had anywhere close to the great selection the PS2 had, but it had an infinitely better selection then the original Xbox. The original Xbox is still considered 'The Halo box' as that was the only real game pushing the console into homes on the larger scale. I also bought a 3DS at launch and have not regretted it. While it didn't have a selection of great games for a while, it was a great upgrade to my DS since it was backwards compatible. Oh yeah, the 20 free games I got from the ambassador program was nice! Especially since many of them I was planning to buy and download anyway (and they would have come to even more money then I lost from he price slash lol).
The Virtual Boy was just terrible, I'll give you that one. But I am happy I bought one for $20 new when ToysRus was removing their stock of it. It makes an interesting and neat looking collectible at least, just like the Power Glove.

OT: The dude is right, there haven't really been any AAA games that can be called "one of the greatest games of all time". I'm not saying that all current gen games are shit, I'm just irritated at how safe devs are playing it these days and I just feel that the gaming industry has lost it's "charm".

I hear that. The last game to come out that made me think 'This will be timeless' was Shadow of the Colossus. Playing that for the first time was like play Zelda or Halo first time; it gave you that feeling that you were witnessing something amazing that would live on in history. Games just don't do that anymore... at least, most don't even try. I just watched a video for that new Tomb Raider game, and while it didn't look bad at all it seemed very typical of what we see in every game this gen. If you put a black bar over the screen, covering the character, I wouldn't have been able to tell that wasn't Uncharted I was looking at. I think the problem is everyone is now trying to be so cinematic, that everything feels like a movie, so everything feels the same. In prior gens when genres were spread out more and protagonists had a bigger selection outside of everyman/woman and space marines, you got distinctly different experiences. Because of that game mechanics were also more diverse since a platformer is distinctly different from an FPS, etc. It was easy for everyone to show their uniqueness and stand out more.

 

[AzrealMaximillion]

The price of the 8 Gigs of Memory is about 10 Bucks retail.
The price of 32 Gigs of the same type of memory is about 25 bucks retail.
Both of those are sold at a profit. Nintendo gets them for much less because they buy in bulk.

The 8 Gig model sells for 300 and 32 gig sells for 350. You think Nintendo doesn't make a profit off of increasing the price by 50$ to give you 15 bucks in additional parts? You think Nintendo Land only is profitable if it sells at Full Price? You're crazy if you think that. The 32 gig model adds about 50$ to the price for about maybe 20$ worth of parts and product.

Where are you getting this information from? The Wii Us are built at a Foxconn factory, not by Nintendo themselves. There is no "buying in bulk" for the memory. So the price of the memory doesn't really matter and is a moot point. Parts price =/= the price you buy it at when you go to an electronic store when it comes to manufacturing. Really, If I were to use your method of calculating the price of the Wii U I could just point you to the tablet controller and tell you to have a nice day, because the tablet alone would be made of the most expensive material. But the fact is that you can't use the retail prices of memory as a good comparison. Hell, you can't really use a piece of what it takes to build a Wii U and draw a price from it, its kind of impossible. Nintendo just pays Foxconn to make them. So when Nintendo says they are selling at a loss, it means that Foxconn's charges plus shipping and other costs work out to above $300 a Wii U for an 8 GB and over $350 a pop for the 32 GB model. How much of a loss the Wii U selling at, we don't know.

You should have actually understood the article I linked too. You clearly read it, but didn't understand.

If you were right and Nintendo was Bleeding money selling and making the Wii U then why did they make a Profit? Why with lowing their forecast for units sold which they already made are they making a profit? Why would selling fewer units then anticipated and with units you already paid for with production, and still make a profit? The value of the yen is the only thing causing it to continue to go up even after the last 3 revisions of sales. The truth is that Nintendo isn't taking a full 60$ loss on the Wii U 8 gig model. It might be 20$ possible 30$. They make money on EVERY game sale and they make the most on their own published titles which gives them almost 2 Nintendo Published games sold for each system. If you were right they should be well into the Red and they aren't even close.

Considering in the link you posted the following was said:"But Nintendo said its profit upgrade was largely due to a weaker yen, as it slashed its revenue forecast for the fiscal year by 17 percent to 670 billion yen and warned it would post an operating loss.", I'd say that they are in the red. That's what an operating loss means. When they use the word "profits" its for when they're making money, but Nintendo hasn't come out of the operating losses from last year. Just put Nintendo's name in Wikipedia and look at the numbers on the right side. They all show RED arrows, meaning that they are operating at a loss.

In the history of Nintendo they've only had 1 year where they had a loss. And that required a Tsunami in Japan, Taiwan Floods Jacking up prices, The Yen going in the Opposite direction it is now, an over priced 3DS, and yea they had a loss that year out of the past 30 years of profit.

Yet, as I stated, your link says that they'll be operating at a loss again this year. No Tsunami to blame, no Taiwan Floods either, and the Yen is in their favour. Still at a loss overall.

For a hundred year old company they're good and figuring out how to make a profit when no one else seems to be able to find one.

Not really considering all of what I just said.

Listen, when Nintendo says that they're boosting profits, it means nothing until the company's overall revenue is in the green. Until that happens, don't think that the word profits means everything is a-ok.

 

[AzrealMaximillion]

I'm sorry mate but I am not going to engage in conversation about this anymore. Not because you are a troll or anything but because you back up my articles and actual STATISTICAL DATA with conjecture and opinions that have no proof behind it.

I know it is a common thing to just spout off random things you have heard without proof but in real intellectual debates people tend to have proof backing up what they claim. Please continue this conversation with me once you get some.

-under

That's fine, but if you're going to use statistical data, make sure its not old, or easily defeated by me referencing an article on this very website that disproves it.

But if you want me to spell it out for you, ok then.

Your link:[link]http://www.mcvuk.com/news/read/u-need-help-retailers-call-for-new-wii-u-price-and-strategy/0111544[/link]

The proof against it:[link]http://www.gamesindustry.biz/articles/2013-01-09-idc-game-consoles-discs-to-remain-revenue-mainstays-for-years-to-come[/link]

and
[link]http://www.escapistmagazine.com/news/view/121472-PS3-Overtakes-Xbox-360-In-Shipped-Consoles[/link]

Result: The PS3 has shipped 77 million in December, the 360 has shipped 76 million. Xbox 360 in third place.

I really don't know how you can go on thinking that Microsoft isn't in any amount of trouble as Sony with the failure of the Surface, the failure of Windows 8 sales, and such but ok, we'll keep going.

Yes, Sony sold their HQ for 1.1 Billion.

And the flip side Microsoft sold their AOL patents to Facebook for $550 million. Sold MSNBC for $330 million. And sold an HQ of their own, their BING HQ for 374.7 million.

Links for each
[link]http://www.theverge.com/2012/7/15/3161659/msnbc-acquisition-comcast-redirect-nbcnews[/link]

[link]http://www.nbcnews.com/id/47144930/ns/business-us_business/t/microsoft-sells-many-aol-patents-facebook/#.US7gs6Lvsb0[/link]

[link]http://www.bizjournals.com/seattle/blog/techflash/2012/11/bings-hq-in-downtown-bellevue-sells.html?page=all[/link]

Point is, Sony selling their HQ is one of the few times (when compared to Microsoft) that they have done something to that degree. MS sells companies and buildings all of the time it seems.

But we're here talking about the gaming aspects, so let's get back to that.

I know that Sony's gaming division has lost them a lot of money, but let's look at the Playstation Brand vs the Xbox brand.

Here's an article showing that the PS3 has lost Sony almost $5 billion while the 360 has lost Microsoft almost $3 billion

[link]http://www.vg247.com/2013/01/07/xbox-360-and-ps3-losses-total-8-billion-ex-sony-employee-paints-grim-future/[/link]

Now, here's an article talking about how the original Xbox lost MS $4 billion over 4 years
[link]http://www.joystiq.com/2005/09/26/forbes-xbox-lost-microsoft-4-billion-and-counting/[/link]

That means Microsoft has lost $7 billion dollars in its attempt to enter the gaming industry. That also mean that MS has been losing money and coming in 3rd for 2 straight generations now.

I'd dare say that for the sake of Microsoft's bottom line, which is already shrinking, the Xbox brand is the most likely to die out of the big at this point. How much more of a loss can Microsoft find acceptable at this point?

There's your statistical argument. Try not to be so snarky next time.