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.