Game Company Financials Examined

An anonymous reader writes "An article over at Curmudgeon Gamer collects together and discusses the revenue reported over the past eight quarters for five game companies: Electronic Arts, Take Two Interactive, Activision, THQ, and Midway. Using graphs and some discussion, it reveals some interesting points and trends in the market. You can see how important Grand Theft Auto has been to Take Two, just how big EA really is compared to Activision, and whether the Xbox or GameCube is generating more revenue for these game companies." This is a very interesting attempt at collating and comparing revenue data for some of the bigger multi-platform game publishers.

Wow the PS2 is Big for EA, Overall Comment

[MBCook]

I didn't realize that the PS2 was just THAT BIG for EA. Considdering that they publish the best selling game of all time (and all 9 (or whatever) of it's expansion packs), you'd think that The Sims would make the PC a bigger share of their revenue. For the PC revenue to stay smaller than PS2, you can tell just how big the PS2 really is.

That said, I would have liked to see the graphs in millions or something like that, instead of percent. That way you could tell that while the PS2 make look like it's market is shrinking for a company in a specific timeframe, it's actually growing, but some smash hit game on the PC just dwarfed the revenue. I also would have liked to see "dots" on the graphs representing some of the bigger games being published so we could see the results.

Quantity versus quality

[xenocide2]

Theres a few deeper reasons why the PS2 represents the larger market. The Sims might be the best selling game of all time, but all time implies a long time. Plus, expansion packs for it sell at a substantially lower cost. Thats not to say that the Sims and the PC market don't matter; the PC market is the second largest for EA.

But EA's real bread and butter is sports games. Sports games appeal to a wide audience that want to enjoy playing video games, but don't nessecarily have the time to learn and play a more original and involved game. People know the rules, and they can all sit on their couch and play with or against eachother. Their signature game Madden is practically a liscence to mint money by selling roster updates and bug fixes as sequals.

The other reason that PS2 gains on PC is lower costs. PC games still suffer from double packaging, and heavy promotional packaging considerations. Packaging on ps2 games, on the other hand, are smaller DVD cases. They weigh less, they use less material. And since the packaging is standard, economies of scale begin to appear. All you need to come up with is a cover slip design, a manual, and the game disc.

The nail in the coffin as to why PC games aren't doing well is their overenthusiasm for online gaming. The Sims online was a PC game and hasn't been doing nearly as well as executives had been predicting. I believe (but have not confirmed) that so far its been a net detriment to the PC side of EA.

The ps2 really is a large segment. Its also somewhat self fullfilling; when one sector owns a large enough portion of the market, developers start seeing less returns for porting games to other systems. The increasing lack of availablity and console exclusives beckons more gamers to the platform, causing a vicious circle.

Re:Quantity versus quality

[scot4875]

The other reason that PS2 gains on PC is lower costs. PC games still suffer from double packaging, and heavy promotional packaging considerations.

Of course, this is completely offset by the fact that there are no licensing fees to publish PC games. PS2 developers have to pay royalties to Sony, which likely far outweigh any packaging costs.

--Jeremy

Re:Quantity versus quality

[jkcity]

"The other reason that PS2 gains on PC is lower costs. PC games still suffer from double packaging, and heavy promotional packaging considerations. Packaging on ps2 games, on the other hand, are smaller DVD cases. They weigh less, they use less material. And since the packaging is standard, economies of scale begin to appear. All you need to come up with is a cover slip design, a manual, and the game disc"

I don't know where you are from but nearly every game released in the UK for the pc these days comes i

Re:Quantity versus quality

[xenocide2]

I'm just going by what I've seen in Wal-Mart and in the news. EA recently announced (and has since shipped) a new packaging format, slightly larger but close to dimension as a VHS box. There are some discount titles that only provide a jewel case, however.

Graphs

[Hedonist123]

Anyone else find those graphs to be set up in a very hard way to comprehend. Having % of revenue along the y-axis and company color coded like that didn't seem to make sense to me. It was hard to tell which console was providing the larger chunks of revenue, since he had gamecube right on top of x-box. I don't know, I just think that there must be a better way to set it up. Still interesting though. Hed.

Wow

[Daetrin]

Looking at those graphs is depressing. If Nintendo has any miracles to pull out of their pockets they better get started now.

On the bright side, for some of the companies there were a few peaks where the GameCube was dominating the XBox, so maybe they're just in a temporary downswing, but the pessimistic side of me has trouble believing that.

Re:Wow

[Mike Hawk]

Nintendo owns Sega? That's a new one on me. Have Nintendo fanboys stooped to outright lying to justify their devotion?

Last I heard Sega was a little unhappy with the NGC. They were dropping their sports line-up from the platform. The best Sega game I played lately...Toe Jam and Earl III, exclusive to XBOX. Whoops.

Re:Wow

[scot4875]

Have Nintendo fanboys stooped to outright lying to justify their devotion?

Zelda, Smash Brothers, Metroid, Eternal Darkness. Those're all the justification I need.

I'll be happy when Nintendo has clearly slipped into the #3 spot, still happily producing good games. That way, I won't have to listen to XBox fanboys pound their chests about how well their console is selling. Of course, it probably won't happen for a while ... meaning I'll get to continue to listen to idiotic arguments from people trying

First party games?

[the_riaa]

The comments about Nintendo's lack of financial market share are severely skewed by not including Nintendo's extremely well-selling first party titles for both GBA and GC. Zelda, Metroid, Mario - those are the staples of the GameCube library, and probably the three best selling games, and to leave them out just doesn't make sense to me. Sure, the Gamecube might be third to the Xbox, but I dont think the figures are as drastic as this comparison shows.