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Old 05-08-2014, 05:56 AM   #1
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Activision Is Reportedly Spending Half a Billion on a Single Game

http://time.com/89407/activision-des...t-500-million/


Victor Luckerson May 6, 2014





Activision is making a half-billion-dollar bet on a single video game.

At a Los Angeles conference last week, CEO Bobby Kotick said that his company would pour $500 million into Destiny, an upcoming massively multiplayer online first-person shooter being developed for the PlayStation 3, PlayStation 4, Xbox One and Xbox 360.

The game comes from Bungie, the makers of the Halo series, so it has a high pedigree and a mountain of hype.

But the figure may still be unprecedented in the gaming industry, especially for a new IP.

Activision did not respond to a request for comment.

Typically, lavish budgets are reserved for franchises with proven popularity.

Last fall’s Grand Theft Auto 5 was estimated to cost $160 million to produce.

The Destiny figure dwarfs that, but an Activision spokesperson clarified to Reuters that the budget includes marketing, packaging, infrastructure support, royalties and more.

The spokesperson said that the game’s budget will be “roughly in line with other Triple-A titles.”

Still, the huge sum shows that Activision is hungry for a new massive franchise.

The company’s annual Call of Duty games have been selling less and less in recent years, and Activision’s sales and profits were both down in 2013.

In an industry increasingly dependent on blockbusters, Activision is trying to position Destiny as too big to fail.
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Old 05-08-2014, 07:58 AM   #2
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There goes all their Call of Duty money
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Old 05-08-2014, 09:08 AM   #3
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Quote:
Originally Posted by Megas75 View Post
There goes all their Call of Duty money
chump change for em'
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Old 05-08-2014, 10:14 AM   #4
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They better hope it does GTA 5 numbers or better just to break even.
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Old 05-08-2014, 02:09 PM   #5
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I find this kind of surprising. They're taking a bigger gamble than I ever expected them to.
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Old 05-08-2014, 03:07 PM   #6
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Quote:
Originally Posted by Megas75 View Post
There goes all their Call of Duty money
Like anyone gives a damn.

Anyway, that is a staggering amount of money to gamble on Destiny. Don't get me wrong, I expect that it will be a good game, but still, it's astounding that they can spend that much money on a single game.
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Old 05-09-2014, 06:15 AM   #7
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http://www.technobuffalo.com/2014/05...tarts-in-july/


Destiny Budget Could Hit $500 Million, Beta Starts in July


By Ron Duwell | May 7, 2014








And you thought Tomb Raider was in a tight spot. Destiny needs to be a huge hit for Activision, or a lot of employees are going to be feeling the pain. In this age of AAA gaming budgets gone wild, Bungie and Activision are absolutely bonkers for pumping as much as $500 million into the new franchise. That must be some kind of record, because it shatters the budget for pretty much every form of entertainment out there.

Reuters reports that at the Milken conference in Los Angeles, Activision CEO Bobby Kotick claims the franchise is a huge risk for the company but the stakes are simply too big to ignore.

“If you’re making a $500 million bet you can’t take that chance with someone else’s IP,” the Activision CEO said. “The stakes for us are getting bigger.”

For what it’s worth, Destiny looks like a really fun game, but seriously? $500 million? By comparison, Grand Theft Auto V clocked in at about half that at $250 million, but that was for an established franchise everybody knew would sell.

Analysts are putting Destiny at having to sell 15 million to 16 million if it wants to break even, meaning it’s not the largest number in history but its still pretty significant. I just don’t see it, though, unless Activision prepares an enormously expensive marketing campaign over the next few months.

What are we working with here to make this the one of the biggest new franchise launches in history? Halo isn’t in style anymore, and Bungie isn’t nearly the household name it once was when the series’ popularity peaked at Halo 3. A whole new and massive generation of gamers have come of age since then and most might have never even played a Halo game. Activision can’t really use Bungie’s name to market to anyone beyond its fanbase.

Call of Duty still hogs the charts, and Call of Duty: Advanced Warfare will be competing against Destiny in the science fiction first-person shooter genre this year. Sure, they are different types of first-person shooters, but what Average Joe is going to know that? The gamer crowd is too small to sell 16 million copies and the casual crowd will lean towards the familiar Call of Duty namesake.

Finally, Activision is totally ignoring the PC market, which has been rocketing off over the last few years with the rise of digital distribution. A huge chunk of hardcore gamers are jumping to gaming on the PC these days, and if Activision is trying to attract these people to make up for those who flock to Call of Duty, why deny them the platform?
Like I said, Destiny looks great, but $500 million worth of great? I’m not sure.

We’ll have to wait until July to get our first hands on it to see if it was worth the check. During its financial reports, Activision confirmed that a beta test would begin for Destiny this July on the PlayStation 3 and PlayStation 4 first. No information for registration has been made available yet, but we’ll keep an eye out for it.

If the beta proves to be successful, I might have more hope in Destiny‘s outlook, but we’ll ultimately have to wait until launch on September 9th to see if Activision’s huge gamble will pay off. Destiny will be released for the PlayStation 3, PlayStation 4, Xbox 360, and Xbox One.
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Old 05-09-2014, 08:47 AM   #8
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Quote:
Originally Posted by Alice View Post
Like anyone gives a damn.

Anyway, that is a staggering amount of money to gamble on Destiny. Don't get me wrong, I expect that it will be a good game, but still, it's astounding that they can spend that much money on a single game.
They're might need to make GTAV sales just to break even like Tanis said. Even with all the hype and Bungie's name, spending that much money on a new IP just sounds not only absolutely insane, but stupid too
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Old 05-09-2014, 10:18 AM   #9
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It's a huge move, but even a mild failure in sales with this isn't gonna put a kibosh on Activision's plans. This is just an indicator that AAA titles have gotten way too inflated.
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Old 05-09-2014, 10:47 AM   #10
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Quote:
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It's a huge move, but even a mild failure in sales with this isn't gonna put a kibosh on Activision's plans. This is just an indicator that AAA titles have gotten way too inflated.
I second this
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