Recent news in the video game world has prompted me to ask whether or not there is money to be made here.
There are new consoles coming from Sony Corporation (ADR) (NYSE:SNE) and Microsoft Corporation (NASDAQ:MSFT) later on in the year, and there are bound to be countless numbers of games from publishers Activision Blizzard, Inc. (NASDAQ:ATVI) and Electronic Arts Inc. (NASDAQ:EA).
In the news
Activision Blizzard, Inc. (NASDAQ:ATVI) and EA have been in the press as of late–one for the good, and one for the bad. We’ll get the bad news out of the way first.
Activision had a great first quarter but their big money maker, “World of Warcraft,” actually lost a whole lot of players. In 2010, the game had approximately 12 million active subscribers, and that has since dropped to 8.3 million. With players paying around $14 per month to play the title, it can be assumed that revenues have dropped by some $50 million per month on the game.
Now on to the great news for Electronic Arts Inc. (NASDAQ:EA)! They will actually be teaming up with Disney on all future Star Wars games. Obviously it is not known exactly what games will be coming, or whether they will be viewed positively by fans, but having such a name on the roster is definitely positive for Electronic Arts Inc. (NASDAQ:EA).
Later this year store shelves shall see a refreshed set of consoles. Sony Corporation (ADR) (NYSE:SNE) has already showed off the controller for their next generation system, and Microsoft will be unveiling their console later today.
The initial reactions from that unveiling will weigh heavily on Microsoft Corporation (NASDAQ:MSFT)’s entertainment division, particularly after the dismal news of late on Windows 8.
One particular feature that hardcore gamers are hoping doesn’t make an appearance could in fact be a make or break on this next Xbox: always-on DRM. Always-on DRM would mean that gamers have to ensure their console is connected to the internet in order to complete basic tasks, even playing games.
The always-on DRM issue led to the “resignation” of Microsoft Corporation (NASDAQ:MSFT)’s Creative Director Adam Orth earlier on in the year after some very questionable Twitter exchanges.
While the DRM fiasco may only have been a hoax or a misunderstanding, it will leave a lot of hardcore gamers waiting and wondering what will become of the Xbox.
Would it mean anything?
Microsoft Corporation (NASDAQ:MSFT) may seem like a company that would have more interest in trying to sell copies of Word rather than Xbox’s, but they’re not. The company actually estimated that their Xbox 360 sales generated some $56 billion at retail.