Analyst: Rise of the Tomb Raider Xbox Exclusivity Period Could Result in 40% Less Sales on PS4
With Rise of the Tomb Raider, Microsoft and Square Enix partnered for a one-year console exclusivity period, meaning it won’t appear on PlayStation 4 until holiday 2016. According to Wedbush Securities’ Michael Pachter and DFC Intelligence’s David Cole, this could negatively impact the sales of the game long-term.
In an article on Gamasutra, Pachter says the timed exclusivity “probably cost only $20 million or so,” with Microsoft spending another $20 million to advertise Rise of the Tomb Raider over the holidays. It seems to have paid off, with Microsoft announcing earlier this month that RotTR sold “well over” one million in 2015, thanks to a big December.
As Cole explained though, the money Microsoft paid might not have been enough to offset the lost PS4 revenue, which he estimates could be around $150 million in the short term:
Unfortunately I think it was probably not enough to make up for the lost opportunity. Anything under $100 million is probably a bad deal for Square Enix, and I doubt Microsoft paid anywhere near that amount.
Weighing in on the effects of platform exclusives, Cole says Square Enix missed out on a major opportunity with the Microsoft deal:
The problem with exclusives in today’s market is you have a clear market leader. So if you are not on that platform, you lose a major market opportunity and it would take a lot for Microsoft or another competitor to reimburse you for lost opportunities.
While Pachter believes Tomb Raider will do well when it’s eventually released on PS4, he thinks the full year-long wait could result in a 40% loss of sales over what it would have seen launching at the same time as Xbox One.
Now that so many franchises appear on multiple platforms, Cole says the idea behind exclusives is driving hardware sales. He adds, “The problem is that one exclusive such like [Rise of the Tomb Raider] is hardly enough to make close to a dent,” and it’s becoming more expensive for Microsoft to secure impactful exclusives, while Sony “as a market leader has less need to pay for market exclusives.”
For Cole, the best exclusives are extras like DLC and levels (Call of Duty is an example of this), because “you aren’t giving away the whole deal, and thus neither party has as much at stake.”