U.S. video game industry sales plunged in October, dropping 19 percent from a year earlier, and 16.4 percent from September, according to data released Thursday by the NPD Group.
But with the tremendous, record-breaking, out-of-the-gate performance of Activision's Call of Duty: Modern Warfare 2 and the coming holiday season, NPD is bullish on the industry's fortunes for November.
Still, the $1.07 billion in total sales turned in by the industry in October were paltry, compared with $1.32 billion in October 2008 and $1.28 billion in September 2009. NPD analyst Anita Frazier tried to soften the blow a little bit in her monthly report, noting that while sales were down precipitously in October, it was still the third-best October sales report turned in by the video game industry.
"The continued economic turmoil, and in particular the troubling unemployment rate, is undoubtedly impacting industry sales," Frazier wrote in a statement. "Our latest Economy Tracker indicated that although consumers' general opinion about the economy is improving, their outlook on their own personal situation is worsening. If consumers' personal outlook continues to erode, they could very well be much more conservative with their holiday shopping this year."
That last sentence is no doubt one of the most chilling group of words imaginable to the honchos at companies like Microsoft, Sony, Nintendo, Electronic Arts, Activision, and many others involved in putting video game hardware and software in consumers' hands, especially as their most important sales months of the year are now at hand.
As always, regardless of the monthly results, the big console makers each had some things to celebrate in the NPD numbers.
For Nintendo, which has seen sales of its once-high-flying Wii dip and perceptions that the console's days of seeming infallible may be over, the numbers had some hope: in October, the Wii took back first place among the consoles--respectively the Wii, Microsoft's Xbox 360, and Sony's PlayStation 3. In October, Nintendo moved 506,900 Wiis, beating out the PS3 (320,600) and the Xbox (249,700).
Sony was coming off the first month the PS3 won since being launched in the fall of 2006, but while the console was beaten out by the Wii, there must certainly be some measure of gratification in having the PS3 come out ahead of Microsoft's console offering.
"In October, we saw continued momentum [for the] PS3, with nearly 70 percent growth, when compared to last October," Peter Dille, Sony Computer Entertainment of America's senior vice president of marketing, said in a statement. It was "the only console to see any growth year over year."
NPD itself touted Microsoft's chief bragging point for October: "Across all categories, the Xbox 360 platform contributed the greatest portion of total industry sales, representing 27 percent of total industry sales for the month," Frazier wrote.
Yet despite the record-smashing first-day sales posted this week by Call of Duty: Modern Warfare 2, the video game industry as a whole is facing a very painful reality: If sales don't improve quickly, there will be layoffs, slashed budgets, canceled games, and more.
Electronic Arts, for example, announced this week that it is planning to lay off 1,500 people as part of a major restructuring--the company's latest--and as a way to stave off growing losses.
And while the industry may have hoped that console sales--especially with prices for next-generation hardware now at their lowest levels ever--would help it rebound, Frazier did not offer much hope.
"Year to date, the hardware category has experienced the sharpest decline in the industry, with unit sales down 10 percent compared to the same time period last year," Frazier wrote. "Recent price cuts helped spur a one- to two-month increase in unit sales, and this month's Wii sales reflect that boost, but the other platforms have not sustained the sales momentum [after] price reduction."
CNET News reporter Ina Fried testing out Microsoft's much-heralded Project Natal.
(Credit: CNET News)According to a report issued by British games magazine MCV, Microsoft's much-heralded Project Natal hands-free gaming control system could hit store shelves as soon as November 2010 and cost as little as $50.
MCV said that Microsoft could launch Natal with a 5 million unit global shipment.
"This and other details have emerged following a behind-closed-doors Microsoft tour of U.K. publishers and studios," MCV wrote. Microsoft "has been demoing the tech and detailing its 2010 plans in order to spur more development support."
MCV also said that it had been told by a publishing source that Microsoft is "trying to get as close as possible to 'impulse buy'" with Natal.
The technology is considered very important for Microsoft as it seeks to differentiate the Xbox from Sony's PlayStation 3 and Nintendo's Wii.
The Seattle Times weighed in on the story by predicting that, "This is probably a preview of what (Microsoft CEO) Steve Ballmer and (president of the entertainment and devices division) Robbie Bach will disclose at the Consumer Electronics Show in January."
Microsoft did not immediately respond to a request for comment.
In a world in which Disney defines its brand and the content it releases under its own name as being aimed at the broadest possible audience, Mickey Mouse is known largely as a feel-good, happy-go-lucky cartoon character.
But that's not how Mickey was in the early days. Back in 1928, when he first hit the world stage, he was a very badly behaved mouse. And now, one of the best-known video game designers in the world wants to bring back a little of bit of Mickey's dark side.
And he'll get his chance to make that a reality. Warren Spector, the game designer behind the Deus Ex franchise, is working on a new game, Disney's Epic Mickey, which is being positioned, in part, as a "re-imagining" of Mickey Mouse.
Planned for a fall 2010 release, Disney's Epic Mickey will be an adventure-platforming game exclusively for Nintendo's Wii. The story is built around a world--crafted by the sorcerer from The Sorcerer's Apprentice--in which a series of forgotten Disney creations live, and thrive. Among those characters is Oswald, Walt Disney's earliest cartoon star. As the years pass and Oswald becomes bitter at Mickey's success, Mickey inadvertently destroys Oswald's comfort zone in the cartoon wasteland and he must face the consequences of what he has accidentally wrought.
"It's a game where we remind (people) that Mickey is a hero who solves problems by dynamically changing the world around him and deciding how to interact with the people and places and problems he encounters in this strange new world," Spector said.
In 2005, Spector formed a start-up, Junction Point, which Disney bought when it commissioned him to work on the Mickey Mouse game. "I've wanted to work for Disney forever," he said, "so that was not a stumbling point for me at all."
And because Spector is a lifelong Disney fan and animation "freak," everything came together in 2007 for him and his Junction Point team to take on perhaps the best-known cartoon character of all time. On Tuesday, Spector talked with CNET News about the project.
Q: How did you get involved?
Warren Spector: I was out pitching a near-future science-fiction game and an enormous epic fantasy role playing game, and my agent suggested we talk to Disney. They turned things around and asked me if I wanted to a Mickey Mouse game, and I told them no, because I don't do kids games and Mickey's been kind of a kid property for a long time. But they said, No, no, we want someone to bring Mickey to a gaming audience in a whole new way and make him a hero for the 21st century. Pretty much at that point, I was in.
What was it like to get a chance to re-imagine Mickey Mouse?
Spector: How often do you get a chance to work with the most recognizable movie star character property on Earth? That's an opportunity most people never get. There was pretty much no way I could say no. Mickey touches everybody, and none of us will ever meet a human being who doesn't know about this character.
What's the best-case outcome for this game, in your fantasy?
Spector: The best case is to change the way people think about Mickey Mouse. He's not just your 8-year-old kid's best buddy, or a character who teaches infants colors on Mickey's Clubhouse. He's a hero again. In his early days, he appealed to every body. From 1928 to the mid-1930s, moviegoers around the world, everybody, men, women, old, young, you name it. Everybody loved Mickey. And the opportunity to bring him back to that place, where he's not just an icon on a watch or a T-shirt, but is actually a character that people care about in a narrative context, or want to be, to look up to as a character whose skin they want to inhabit for awhile, Boy, I can't think of a better (challenge) for someone who tells stories and makes games for a living.
The logo for Disney's Epic Mickey.
(Credit: Disney Interactive Studios)
Why does Mickey need re-imagining? And why now?
Spector: There's these characters, like Mario and Link (from the Zelda games) and Sonic, and I don't know if it's true, but you've got to believe that those characters--who are three heads tall and cute and iconic--at some level were inspired by Mickey Mouse. So why shouldn't Mickey be at the top of the gaming heap? Mickey deserves to be at the top of the game hero pyramid.
What are some of the things you're doing to make this new Mickey recognizable for everyone?
Spector: I came into this with a pretty good idea of who Mickey was. I wanted to remind Mickey that it's okay to be mischievous and badly-behaved. For so many years, he hasn't been allowed to do anything remotely mischievous. But if you go back to those early cartoons, he was very badly behaved, and we've got to let him get back to that. And in his early cartoons, he was very cartoon-y, he squashed, he stretched. He could remove his tail and use it as a sword. That was the second thing. And the third leap was mischievous cartoon character made of paint. So we talked about what we could do if we gave Mickey control over the stuff that he's made of and let him paint and then use paint thinner to remove stuff.
Were there other things that were essential for bringing Mickey to this medium?
Spector: One major challenge was finding a look for him, especially a 3D look. With a couple of rare exceptions, Mickey's always been in 2D and the animators cheated all the time, with the way his ears work and the way his nose fits relative to the rest of his face. In 3D you can't do that, so I looked at the few previous 3D Mickeys and I didn't feel anybody had gotten it right. We went through probably thousands of concepts trying to find the right look.There are a lot of people at Disney who care a lot about Mickey Mouse, and so getting a look that people could get behind was tough. Rendering it in 3D was tough and then getting it to move like a cartoon character was a huge challenge and tons of fun, and you'll tell me if we succeeded.
Warren Spector, lead designer on Epic Mickey.
(Credit: Disney Interactive Studios)
How much control did you have and how much control Disney assert?
Spector: I was really worried about that when I first started on this. There are lines you don't cross with Mickey Mouse, OK? But the thing that surprised me was how far out those lines were and how obvious it is where the lines really are.
There are people who say, 'Oh, give Mickey a big knife and put a gun in his hand, and then I'll like him.' Well, come on, nobody's going to do that. And you're not going to make Mickey evil, you know? And when you have an icon, where any combination of three circles defines Mickey Mouse for most people on the planet, you're not going to make his head square. I'd say it was a pretty easily negotiated deal, creatively.
Talk more about where the story idea came from?
Spector: During a meeting with the Disney guys, they showed us a PowerPoint with the concept of cartoon wasteland, a world of rejected and forgotten Disney creativity. And the foundation was making Mickey relevant to a gaming audience and a modern audience. It was funny because I watched this presentation thinking, Holy Cow, this is phenomenal and the seed of an amazing thing. And then all the execs were saying, Oh, you don't have to use any of that, this is just our think tank's concept. And I'm sitting there, going, Are you guys crazy. That's a great idea. Why would I not use all of that? I just thought it was so funny because they were trying so hard to make it clear that I had all this creative freedom, and I was like, No, I don't want it, I want this as my starting point.
Can you tell me something about working with these famous Disney characters that would surprise us?
Spector: I think the thing that surprised me the most is how easy it is to get these characters almost right. It's like, drawing Mickey or any other character in the Disney archives, they are so well known and defined and recognized and have such strong personalities that getting them 90 percent right is very easy. But that last 10 percent that just nails them, that's really, really hard. And that goes for how they look, and how they act and how they move, which is one of the reasons why I was so proud of my animators. I didn't tell them to do this. They came up with this idea on their own, of going back to the old cartoons, and rotoscoping them. They took the old cartoons and took our model and rig and then duplicated classic 2D animation, and composited our guy into classic Disney 2D cartoons. When you couldn't tell if it was our model or the original 2D animation, that was when I knew we had it.
Why only the Wii?
Spector: At the beginning, it was supposed to be on all platforms. I remember vividly how nervous I was about that. The idea was we were going to do a Wii port and I was never comfortable with that because the Wii really deserves its own design, something that takes advantage of what the Wii does best. We were talking about this one day and (Disney Interactive Studios executive vice president) Graham Hopper basically said, What does it take to ensure quality? I said, you can never guarantee greatness, but you need enough time and money to be competitive and it helps if you can focus. A single platform would be great. And it was an easy step from there to, Hey, we should do a Wii exclusive.
What about the Wii "stalling?" Does that worry you at all?
Spector: Yes and no. I've been doing this for 20 years, and I've had this saying, That I just need to sell one more copy of a game than is necessary to get my publisher to fund my next one. So I'm looking at this as, I've got a responsibility to Mickey Mouse and to Disney, and if I do something really good, commercial success will follow. I've got to believe that. And once you start talking about painting, people's hands (on the Wii) just immediately start moving as if they're holding a brush. It just totally works. I think we're on the right platform.
People always talk about dog years, or cat years, but what about video game console years?
It's hard to know what that math is, but one thing is certain: Sony's PlayStation 2 turned 9 years old Wednesday, and it sure feels like the best-selling video game console of all time has been around a whole lot longer than that.
Yet even though we're already more than three years into the PlayStation 3/Xbox 360/Wii console generation, the PS2 is still going strong. Routinely, month after month, its sales are in six figures--146,000 in September in the United States alone, according to The NPD Group--and there's no reason to think the 485 (and counting) developers who have made games for the platform are going to stop any time soon.
The PS2 turned 9 on Wednesday. What's that in video game years, if dog and cat years are equal to 7 human years?
(Credit: Sony)In large part, that's because there are millions of people for whom the world-beating processing power of the PS3 and the Xbox 360, and the graphics-so-good-you-can-see-beads-of-sweat-on-sports-players'-bodies aren't worth paying several hundred dollars for. For $100, they say, you can get one heck of a good video game playing experience with a PS2.
It "still holds a place in my heart--there's so many great games with huge amounts of replay value," said Michael Steavenson, a public relations professional who bought his PS2 around 2001. "I'm not so interested in blazingly fast processing speeds, graphics that make games look like a movie, or uber-cutting-edge hardware stats. If the game is well-designed, fun to play, and provides me with a good emotional connection, I'll play it forever."
According to Sony, one out of every three U.S. households owns a PS2, and, worldwide, almost 140 million people have one. To date, Americans have bought more than half a billion PS2 games, and all told, nearly 10,000 titles have been released for the platform. Not bad for a machine that has earned the right to be living out its golden years sitting on a porch somewhere, smoking a cigar and grumbling about kids these days.
... Read more
The PS3 Slim, the newest iteration of the PlayStation 3, comes with the lowest price ever for the PS3: $299. Because of the price cut, the PS3's sales rose in August and September, and many people see signs of a resurgence for the console.
(Credit: Sony)Is Sony's PlayStation 3 at long last ready to stop being its rivals' punching bag?
With its first-place finish in September in number of units sold, Sony finally has a tangible response to persistent criticism that its PS3 can't keep up with its next-generation video game console competitors, Microsoft's Xbox 360 and Nintendo's Wii.
For the month, according to video game analysts at the NPD Group, Sony sold 491,800 PS3s in the United States, while Nintendo moved 462,800 Wiis and consumers bought 352,600 of Microsoft's Xbox 360s. It was the first time since the next-generation console wars began in earnest nearly three years ago that the PS3 finished a month on top.
Yet, as everyone knows, a single positive piece of data does not a trend make--something Sony's competitors are quick to point out--especially when the existing trend is so contradictory. So, on the heels of those rosy-at-long-last September numbers, and the August price cut and launch of the new PS3 Slim that preceded them, can Sony finally demonstrate conclusively to its detractors that it is through being badly outmaneuvered?
According to a group of experts interviewed for this article, the answer appears to be yes. No one will yet predict that Sony is ready to grab hold of the leadership position it enjoyed in previous console generations. However, there does seem to be widespread agreement that for the first time since its November 2006 launch, the PS3 is ready to seriously compete for that role.
"I think that the fact that they did introduce a new footprint for the PS3 (the Slim) and a lower price point, coupled with some of the really high-demand games" coming out for the platform, "could really prime the pump for Sony to have a resurgence for the PS3," said Brian Crecente, editor of the popular video game blog Kotaku.
"I do think that we are probably going to see, if not it topping the charts leading into the holiday, it...doing better than it has in (the recent) past," he said.
Beginning a comeback in a hole
There's no doubt, however, that Sony is beginning any PS3 resurgence in a rather sizable hole. Since the start of the current console generation (in November 2006 for the PS3 and the Wii, and November 2005 for the Xbox 360), Sony has sold 25.26 million PS3s worldwide and 9.76 million in the U.S, according to VGChartz, a Web site that aggregates video game sales data. By comparison, the Wii has moved 54.19 million units worldwide, of which 25.05 million were in the U.S., and Microsoft--with its one-year head-start--has sold 32.51 million Xboxes, including 18.66 million in the U.S.
By those measures, the PS3 has a minimum of a 2-1 disadvantage, in the U.S. at least, when it comes to the PS3 install base. That fact puts pressure on third-party developers working on games for the console because they know that there are at least twice as many Xbox buyers in the U.S. as there are for the PS3.
That dynamic, in turn, has led to one of the biggest complaints over the years about the PS3: that the software lineup has paled in comparison to that of the Xbox. To be sure, Sony has always disputed that notion.
Hard to prognosticate
Over the last three years, this space has been home to multiple arguments that the PS3 would one day emerge as the clear-cut winner of the next-gen console wars. But there's also been plenty of room here for the theory that Sony's flagship video game device was doomed to languish behind the Xbox and the Wii.
Clearly, prognostication about the PS3's fortunes has been difficult. And with the state of the economy in flux, supply chains always hard to analyze, and consumers' whims ever-changing, there's no way to know for sure how the console wars will go from here on out.
But Sony definitely feels like it's finally in the driver's seat.
"Overall, we're just hitting a stride that just (reasserts) what we knew all along--that there's tremendous value under the (PS3's) hood," said Julie Han, Sony PlayStation spokesperson.
That's a notion that video game industry analysts agree with. Yet when talking about Sony's laudable September numbers, they also point, first and foremost, to the fact that there were a lot of consumers sitting on the sidelines, just waiting for the company to lower the PS3's price. In August, with the release of the $299 PS3 Slim, Sony did just that.
"It's really a combination of pent-up demand and (the point) where value and pricing meet," said Jesse Divnich, an analyst with Electronic Entertainment Design and Research. "The (thing) about the PS3 was, it was really a system ahead of its time. Developers didn't really have the capabilities to take advantage of all the power in the PS3, and at the same time you had systems like the Wii, which just had perfect timing. But now, (the PS3) has caught up."
That means, Divnich continued, that the time has finally come where the PS3's jam-packed collection of a powerful video game console, a Blu-ray player, and built-in Wi-Fi met consumers' needs, even as the price dropped to where large numbers of people feel they can afford it. The lowest-priced Xbox costs $199, while the Wii runs $249.
Finally hitting a 'sweet spot'
Divnich said that at $299, the PS3 has finally hit its "sweet spot." And he said while it's likely the initial boost of sales that came as a result of the August price cut will slow down, "Long term, into 2010 and 2011, I don't think the PS3 is going to be in last place to the degree it was before. The gap between the systems will be much smaller."
For his part, Wedbush Morgan analyst Michael Pachter said he expects the PS3 to outsell the Xbox during the holiday season because of the perceived value of the $299 PS3, loaded as it is with the Blu-ray player and Wi-Fi. He and others do, however, still think that Nintendo will sell more Wiis because of the broader general appeal of that device and the fact that it is seen as a better Christmas present.
"Is Sony back? Yeah," said Pachter. "Are they back as the leader? Probably not. Are they back in second? Probably."
Another analyst, Lazard Capital Markets Senior Vice President Colin Sebastian, also attributed the September PS3 sales boost to the "pent-up" demand for a lower price, and said that there would have been serious trouble for the console if the results had not been so good.
"If they had not shown the uptick with the price cut," Sebastian said, "then we'd all be putting a nail in the coffin for (the PS3). But what we're seeing is that there's still life left for the PS3, and that's an encouraging data point (for Sony)."
Still, as Pachter put it, "Microsoft is not the type of company that's going to stay (down) for a long time. They don't like it."
That's why, Pachter said, if the PS3 can keep pace with the Xbox for the next few months, there's a good chance that Microsoft will drop the price of its console another $50 sometime early next year, a move he doesn't think Sony would be able to match.
To be sure, Microsoft wouldn't easily cut the Xbox's price--"they're certainly not going to give money away just for the hell of it," Pachter said--but it is an arrow in their quiver.
Sebastian said he, too, could see an Xbox price cut next year, as well as one for the Wii. Would Sony follow suit if its rivals did so?
"They could do it," Sebastian said. "It's just a matter of what their tolerance is for absorbing less revenue on the hardware side, and whether they can make up that revenue on the software side."
According to Xbox spokesman David Dennis, a price cut is just one of many things Microsoft would consider as a way to keep pace with the market. He said other possibilities include different hardware and software bundles. "There's a lot of different levers you can pull," Dennis said.
Not surprisingly, Dennis is dismissive of the PS3's sales boost. He agreed that there were a lot of people waiting to buy the console at a lower price, but said that the impressive initial jump in units sold came as a result of early leaks of pictures and information about the PS3 Slim, and so there were "months of pent-up demand."
Further, he predicted that Sony would not see a sustained resurgence for its console and that even in September, when the PS3 outsold the Xbox and the Wii, Microsoft brought in more revenue for the entire Xbox ecosystem--including accessories, software, and fees for online services--than did Sony.
The two halves of 2010
In the end, most people seem to agree that the overall fortunes of the consoles have as much to do with software as price. That's why each of the analysts talked to for this story pointed to a bright future for Sony: They see a lot of strength in the PS3's coming games lineup, which includes titles like God of War III and Gran Turismo 5. And then there's also Sony's PlayStation Motion Controller, which could bring the PS3 more Wii-like functionality.
That's why Divnich said he thinks that the PS3 is likely to dominate the first half of 2010.
But he also expects that Microsoft will release its highly anticipated Project Natal motion-sensitive controller in the second half of 2010, a move that could stir up the console pot anew. Indeed, Divnich said he thinks that the Xbox will once again overtake the PS3 at that point.
And after that? It's anybody's guess.
For the first time, the Sony PlayStation 3 was the monthly top-selling video game console, a mark that has been nearly three years in the making for the much-maligned platform.
According to video game analyst NPD, Sony sold 491,800 PS3s in September, beating out Nintendo's Wii--which moved 462,800 units--and Microsoft's Xbox 360, which came in last at 352,600 units sold for the month.
The PS3, the newest iteration of Sony's next-generation video game console, finally won the top slot in a monthly sales report, thanks to the platform's lowest price ever.
(Credit: Sony)For Sony, the news seemed to prove that many would-be PS3 buyers had been waiting for nearly three years to get one of the consoles at a price more in line with what Nintendo and Microsoft charge for their devices.
In August, Sony unveiled the $299 PS3 Slim, which got the platform under the $300 level for the first time. The Wii currently runs for $199, and the lowest-price Xbox goes for the same.
Based on the PS3 price cut, some analysts had been predicting that the console would finally come out on top when NPD released its September numbers. Indeed, Wedbush Morgan Securities analyst Michael Pachter was proven right when he suggested that price cuts for all three consoles would most benefit Sony. He even said that he thought it is possible that the PS3 will outsell the Xbox for the rest of the year, which, if true, would be a major blow to Microsoft's video games group.
Sony would do well to temper any crowing. Its first one-month victory came after nearly three years, and clearly demonstrates that many buyers felt the console was too expensive previously. The PS3 was originally released with a top price of $599.
Still, the September results are big news for Sony and could be a sign that things are finally turning around for the beleaguered PS3. ... Read more
Sony announced it was working on a new motion controller at E3 last June in Los Angeles.
(Credit: Daniel Terdiman/CNET)Sony announced late Wednesday night from the Tokyo Game Show that it plans to release a new motion-sensitive controller for its PlayStation 3 video game console sometime during spring of 2010. The news came just hours after Nintendo's own announcement that it was cutting the price of its Wii console from $250 to $200.
The company originally announced that it was working on a new controller at E3 last June. That news seemed, at the time, to indicate that Sony was aiming at taking on the Nintendo Wii and its intuitive Wii-mote. Microsoft, too, unveiled a hot new controller system, code-named Natal, but revealed no substantial details about how it would be used, what it would cost or when it would be available.
As for Sony, it didn't say last June when its new device would hit the market. So Wednesday night's announcement marks the first time it has given any specificity about the date.
"The newly announced Motion Controller is equipped with two motion sensors, three axes gyroscope and three axes accelerometer that can detect the controller's angle and movement held in the user's hand," Sony said in a release. "Together with the PlayStation Eye camera for PS3 which can accurately track the absolute position of the controller, the controller can detect the natural and intuitive movement of the hand and reflect the precise movement on to the game."
Earlier Wednesday evening, Nintendo said it was slashing the price of the Wii from $250 to $200. Although both announcements were made during the Tokyo Game Show, the timing is notable given that with Sony's announcement, PS3 users and fans now have a better sense of when their favorite console will take on some additional Wii-like functionality. Nintendo may well have decided it couldn't waste any time in making its own move to protect its console.
Is this the new PS3 Slim? Rumors have it Sony may unveil such a device at the Gamescom show in Germany Tuesday. On the other hand, it may all be fanboy-driven fervor with no substance. Either way, to CNET News reporter Daniel Terdiman, the excitement is unlikely to be matched by the reality of anything Sony may introduce.
While all new technology product rumors have to be taken with a grain of salt, you can sometimes tell--often by the volume of online chatter about a particular morsel--that one is more likely to turn out to be true.
That seems to be the case with the so-called "PS3 Slim," a rumored new PlayStation 3 form factor that could well be on the horizon. And if the latest slew of blog and forum posts are right, there's a pretty good chance Sony will formally announce the new console Tuesday at the Gamescom conference in Cologne, Germany.
That may be true, and, of course, it may not. But what I want to know is why so many people seem to be so excited about this as-yet-unseen console? After all, the PS3--once thought by many to be the most likely winner of the next-generation console wars between Sony, Microsoft (with its Xbox 360), and Nintendo (with its Wii)--has lagged far behind its competitors.
... Read moreIn a stark reversal of the trend on display just a few short months ago--when general retail sales were plummeting even as the video games industry was still showing growth--cautious optimism in retail is now being offset by many losing months in video games.
In July, according to industry analyst the NPD Group, video game sales fell for the fifth straight month, and the year-over-year numbers are striking: In July, the video games business posted sales of $848.9 million, down 29 percent from $1.1 billion a year earlier. Year-to-date sales, reported NPD, were at $8.16 billion, down 14 percent from the same time period a year ago.
And things are only getting worse. While the industry's June numbers were down a full 31 percent from a year earlier, they still topped nine figures, coming in at $1.17 billion in June. But that means that in July, sales were down 27.4 percent from just a month earlier.
It wasn't that long ago that many people were making the argument that video games--because of their relatively low cost and many hours of entertainment value--were seen as close to recession-proof. But now, it would be hard for anyone to make that case.
Indeed, NPD analyst Anita Frazier wrote in a report Thursday that, "In order for the industry to come in flat or slightly up for the total year, the back five months of the year have to come in 11 percent (or more) higher than the last five months of last year."
That would seem to be a near impossible task, given the recent trend. But Frazier did throw the industry a bone: "While year-to-date results are weak, there are some big titles set to be released over the next several months, including Madden (10, from Electronic Arts) this month, which should help spur sales. The worst...should be behind us, and looking beyond August, we have The Beatles: Rock Band, Halo 3: ODST, and of course, Call of Duty: Modern Warfare 2 to look forward to."
Not to mention Guitar Hero 5.
One thing was also made clear in NPD's July report: sales weaknesses in the industry are being seen across the board. However, hardware led the charge, with a drop in sales of 37 percent ($280.94 million in July, 2009, as opposed to $447.71 million a year earlier). Software and accessories were down 26 percent and 12 percent, respectively.
Microsoft was quick to jump on what may have been the only bright spot in NPD's report: that its Xbox 360 was the only console to deliver growth over a year earlier. In its own report, trumpeting NPD's numbers, Microsoft pointed out that the Xbox has turned in 17 percent growth for the year over the same period in 2008.
And while Nintendo's Wii still leads the pack among the big three consoles (the Xbox, Sony's PlayStation 3, and the Wii), its lead has shrunk considerably. In July, consumers bought 252,200 Wiis, versus 202,900 Xboxes and 121,800 PS3s.
All in all, it's hard to be optimistic about the industry's prospects, though, as Frazier pointed out, there are a slew of big titles coming down the pike that could drive big sales. Still, the same is true every year, and as a result, there are few who could argue at this point that the video game business is facing what may be its biggest crisis in years.
The appearance by Beatles Paul McCartney and Ringo Starr at the Microsoft Xbox E3 press briefing on Monday caught the world by surprise, and turned into a perfect way to formally introduce 'Beatles: Rock Band.'
(Credit: Daniel Terdiman/CNET)LOS ANGELES--If you were among the thousands of people at Microsoft's E3 press briefing on Monday, it's a pretty sure bet that the appearance on-stage there of Paul McCartney, Ringo Starr, and Yoko Ono was one of the most unexpected things imaginable.
But if you think about it, the very existence of the game that led to their showing up during the Xbox press briefing, Harmonix and MTV Games' "Beatles: Rock Band," is even more surprising. After all, the Beatles have, over the years, maintained a stranglehold over control of their music. For example the Beatles are still the holy grail that iTunes has not yet been able to corral.
The game will be released on September 9 (09.09.09) on the Xbox 360, the PlayStation 3, and the Wii.
So how did the game come to pass?
Since the two remaining Beatles weren't able to come to the phone for this article, I decided to stop by the Harmonix booth at E3 and ask the game's lead designer, Chris Foster, for the skinny behind what has got to be one of the biggest coups in video gaming history.
Foster said the story begins a couple of years ago, when MTV President Van Toffler ran into Dhani Harrison, son of the late Beatles guitarist George Harrison, in some random social setting.
"It was just sort of through happenstance," Foster said. "Dhani was a big 'Rock Band' fan, and there was this sort of, 'Wouldn't it be nice if...but it'll never happen.'"
But being a "Rock Band" fan, Dhani Harrison took his idea to Harmonix CEO and co-founder Alex Rigopulos and began a conversation about what a Beatles version of "Rock Band" could be. Foster said that the idea seemed like a huge challenge, but, deciding to pursue it, Harrison began evangelizing the idea to Apple Corps, the Beatles' U.K. publisher, and its shareholders, particularly McCartney, Starr, and Ono.
"So then, from that point, it was just sort of getting them familiar with ('Rock Band')," Foster said, "and getting them understanding what the game could be like."
By now, the discussions were far enough along that Harmonix put together a simple demo of the kind of music and conceptual art that could be used in the game, Foster said.
And, amazingly, inexplicably, it worked.
Creative partners
"At that point," Foster recalled, things "moved to (the Beatles) being creative partners" in the project. One of the most vital things to happen at that point was the introduction of music producer Giles Martin to the "Rock Band" project. Martin, the son of the Beatles' original producer, George Martin, helped Cirque du Soleil put together its Beatles show, "Love."
That was crucial, Foster said, because Martin was able to help solve one of the most important problems any Beatles "Rock Band" game would have, adding multitrack capabilities.
"We needed multitrack," Foster said, "because in 'Rock Band,' (players) need to get (individual) feedback about whether they're playing well or not. So with all those pieces in place, we were able to do a demo of what the music (in the game) would be like."
As things progressed, the developers knew that to make the game feel authentic, they'd have to offer players real Beatles venues to play in. So they worked to add famous Beatles locations like Liverpool's famous Cavern Club, the Ed Sullivan theater, Shea Stadium, the Budokan in Tokyo, and the rooftop at Apple Corps.
Then, Foster said, the development team came up with the idea for adding psychedelic dreamscape visions to the game. The game's trailer (see below) does a great job of demonstrating that element, as do some of the best pieces of Cirque du Soleil's "Love."
'We respected them and their music'
To Foster, the chief reason that the improbable game ever came together at all is that "they liked that we respected them and respected their music. I don't want to put words in their mouths, but what was important to us was that we respected them."
That's one reason that the development team made sure to include venues where the Beatles had actually played famous shows. "We weren't shoving them into live venues that didn't make sense," he said.
Another important factor was the developers' adding the ability to include vocal harmonies as part of game play.
"Their music is so much about harmonies," he said. Adding vocal harmonies was something that had never been done in "Rock Band" before, but it was considered vital to accurately representing the Beatles' music in the game.
And that also presented the developers with a hurdle they had to clear.
"The challenge (was) making it so vocal harmonies were fun and challenging, but really accessible, and finding a way to put that in the game, without overwhelming" players, Foster said. "(We didn't want to make them) feel like they failed to sing like the Beatles."
Foster acknowledged that contracting with the Beatles was a huge win for Harmonix, especially when it's been clear for some time that "lots of people were thinking about doing it."
The game is already being anxiously awaited by players, developers, and industry executives alike, and for both game play and business reasons.
"Clearly, (the Beatles) saw an opportunity of reintroducing their music to the current music-loving consumer and it makes perfect sense for them as they try and manage their brand," said Nintendo President and COO Reggie Fils-Aime. "So I think it makes a lot of sense and, candidly, what the music industry is finding is that the games industry is a great way to drive music sales."
And for Microsoft, having McCartney, Starr, and Ono take the stage at the Xbox press briefing at the University of Southern California's Galen Center was a gigantic victory. A Microsoft spokesperson said that the appearance came about because the company is always talking to its publisher partners, including, in this case, MTV Games. And that as "Beatles: Rock Band" progressed, the Beatles decided that the Xbox press briefing would be a very appropriate place to announce the game.
Note to Sony and Nintendo: Work harder at finessing those publisher partner contacts, and next time, maybe the stars will pick your E3 briefing.
To Foster, a big part of what makes the game seem authentic was that the designers concentrated on "telling the Beatles' story" but still finding a way to do so in the context of a "Rock Band" game that fans of both the band and the game franchise would appreciate and recognize. And also because the game will appeal to even the youngest Beatles fans.
He explained that the Harmonix team liked the idea of bringing new, younger audiences to the Beatles for the first time. But reality soon disabused them of that notion.
"The (Beatles') music is like the air we breathe," Foster said, "and it catches every generation...It's sort of presumptuous to think you can introduce the Beatles to anyone."







