PS3 is supposed to drive the gaming division (thanks to PS2 they can/have taken their time), the Blu-ray movie division, helps drive the flat panel division and is central to SONY's future in digital distribution of their content.
SONY is currently looking at selling off its finance arm...raising approx 8 Billion USD in the process.
"I agree that Sony desperately needs market share...I just fail to see why a large company with interests in many areas would continue to dump money into a single division."
While I'm not weighing in on the MGS discussion as I am still undecided, I would just like to point one thing out about Sony. They will "dump" money into the gaming division in the bucketloads for one main reason. Blu-Ray. I read an article referenced in this site (couldn't find it) that Blu-Ray (including PS3 sales) had outsold HD-DVD in North America. A victory in both the format war and the console war is worth billions upon billions in revenue. Even a draw or a loss in the console war could still be a victory in their eyes as it would mean millions of Blu-ray consoles distributed all around the world that will be no less useful. If Blu-Ray wins out and gets the kind of exposure that DVD has for even a couple of years then that is a huge success for Sony. Only a huge technological advance will top Blu-Ray because if we can see everything in High Def and Blu-Ray allows for multiple lanuages and the like then what need have we for further advances when watching a movie?
The winner of this format war could be the standard for years to come as new technology comes from seeing a need and feeding it, but, if there is no need......
The format war could be worth trillions. So don't think Sony will just pack up here and go on to PS4. While it will always be in the back of their mind, the rest of their mind is thinking of the bonanza that could stem from winning the format war with PS3 as the playmaker in that. On that basis Sony could well factor in a price cut/extra bundling for the holidays as long as they can see that it will lead to greater profit.
That wiki entry about MGS3 is well-referenced...except the comment about Subsistence selling 1 million copies (which has none). Without any confirmation, I don't believe it. Even vgchartz doesn't list it. If it is considered a completely seperate SKU for sales (and I don't see why it would be...), then it should be a seperate stock anyways and irrelevent to this discussion (if MGS4 will have a quarter of its sales from it).
I'm not sure I would call MGS more accessible. Comparing the stories and general focus of each series, I would say that Splinter Cell is a bit more mainstream. Of course it also spreads itself thin over all platforms and probably cannibalizes its sales through speedy sequel turnover time.
I agree that Sony desperately needs market share...I just fail to see why a large company with interests in many areas would continue to dump money into a single division. Shareholders won't want their money lost on PS3 price cuts when it could be put into LCD TV ads. At some point there might be a decision to milk the last bit from the PS2 line (still very lucrative) and cut their losses with the PS3 and start work on an early release for the PS4. Right now, their gaming division is rapidly changing from a money-maker to a money-pit. Sony wasn't built around gaming and nor is it dependent on it and I'm certain that execs are already setting a point where they'll have to cut their losses if things don't improve soon. If one price cut didn't produce results, why would another? Sorry, drifted a bit off topic.
I agree that MGS2 and MGS4 have similar circumstances...however, MGS2 came off of great sales and critical acclaim of MGS while MGS4 is coming after a big drop in sales. Will the MGS fans come back? Hmm...
@Laoldar, I do not think Splinter Cell is a good comparison because it hasn't approached the sales that the MGS series has. The best it ever did was 2.93 million copies with SC1 for XB. And ever since then it has been going downhill. SC1 XB 2.93 million SC2 XB 1.41 million SC3 XB 1.07 million SC4 360 1.02 million
MGS1 PS1 5.51 million MGS2 PS2 5.56 million (not including Substance) MGS3 PS2 3.96 million (not including Subsistence, which Wikipedia actually has sales at >1 million)
MGS is a more accessible game than SC & it sells much better and is more popular. There is not a better comparison, as the stealth genre is much like the survival horror genre, it is not broad in the amount of games. MGS stands alone as the stealth king, much like Resident Evil stands alone as the survival horror king.
My last post was ENTIRELY about why MGS2 did so well & why MGS2 & MGS4 have so many things in common. I don't know why you're acting like I went back to MGS2 in order to try and forget about MGS3. And if you add Subsistence sales to MGS3 its actually sold over 4.96 million.
The lower sales for MGS3 could be due to the fact that the game came out in holiday 2004, going against a barrage of other amazing games and pretty late in the PS2's lifetime. Look at God of War, which came out a few months later than MGS3, it only pulled in 2.66 million.
If we look at how much MGS2 & MGS3 sold in each region here is how it breaks down: MGS2 JA: .85 mil MGS3 JA: .86 mil..... +.01 MGS2 NA: 2.29 mil MGS3 NA: 1.42 mil... -.87 MGS2 Others: 2.42 mil MGS3: 1.68 mil.. -.74
That difference from MGS2 to MGS3 is not bad at all considering the timeframe during the PS2's life when MGS 2 was released (& how it showcased the PS2's power & 1st AAA PS2 game) compared to the timeframe of when MGS3 was released. Now MGS4 is being released in a timeframe much more similar to MGS2 than when MGS3 was released, the main point of my previous post. You can't just compare games in a linear fashion: game 1, game 2, game 3 and "now game 4 must follow this linear trend".
Yes, I believe there will be a pricecut this holiday on the PS3. But it may come in a variety of forms. Either the current 80gb bundle gets a price cut or Sony comes out with more bundles or a different PS3 SKU, passing on more savings. PS3 needs to start gaining marketshare, that is the most important thing. If more PS3's aren't sold, software will not sell enough, and this will also hurt 3rd party support. Do you believe that PS3 selling badly and software sales being very low, but with a higher PS3 price; is actually better than PS3 selling decently with decent software sales but a lower hardware price? It costs tons of money to make games, Sony has to worry about software sales just as much as hardware sales. Software is where the profit is. And the cost of Bluray & the hardware in the PS3 is dropping steadily, they will be able to pass on more savings this year.
I'm not saying traders should price a denied rumor into the price of MGS4 stock, I'm saying that this is in the back of the minds of traders just like Brian (Kultofcows) of the SE talks about how users would be having to price in the risk of cancellation into a futures contract before the change was made so that a cancelled game would be refunded.
I doubt it would take a year to compress cinematics from MGS4 to fit on several DVDs. If the game did come to 360, they would either already be working on it or be able to create it quickly afterwards with the full team, and it is easier to develop for the 360.
Laoldar and others ... thanks for your thoughts thus far.
As an aside...an 80GB PS3 with no game in the box for 499 replacing the 60GB, in my opinion, is extremely likely for the holiday season. The marginal cost difference in the 80GB and 60GB is nothing to SONY (Reeves was quoted as saying it was pennies per console).
If you don't think that Splinter Cell is a good comparison (it is one of the most successful stealth franchises), please name a more appropriate one. I find myself struggling to think of a very successful stealth game beyond these two franchises (though I may not be the best person to think of that, having only played Twin Snakes and MGS2). Why are you continuing to go back to MGS2 and ignoring MGS3? Could it be that many who bought MGS2 were turned off by the story and didn't come back for MGS3 (something you see a lot of on mesage boards)? If so, it could mean that MGS2 is a bad comparison. Otherwise, why did 1.5 million MGS2 gamers not pick up MGS3?
A price cut on the 80 gb by this holiday? I don't think that Sony's gaming division can handle two pricing cuts in their first year of the PS3. Their divison is going to be in serious financial troubles if they have to continue cutting into their own bottom line and could start becoming a target if it begins to hold back the rest of the corporation. Sony is already taking a $200 million dollar hit by reducing the 2 million 60gb systems sitting in warehouses.
I don't think that exclusivity to the extent you claim (MGS2 on the XB didn't catch on) and besides Konami and Kojima have repeatedly (and clearly) stated there will be no 360 version...so while it may happen, I don't think traders should price a denied rumour into the price. If a 360 version was to happen, it would probably take a good year to come out anyways just to compress the cinematics from Blu-Ray onto several DVD9s and port the game over.
@Laoldar, I no longer hold any shares in MGS4 but I'd like to reply to what you posted. MGS2 sold 5.56 million because it was the first game on PS2 to showcash the systems power and deliver true AAA gaming. MGS4 will likely do the same for PS3, [in terms of] showcasing PS3's power and delivering the first AAA game.
But MGS2 came out when the PS2's installed base was between the following #'s: (Sept 01: 19.57 million, Mar 02: 28.68 million) so the installed base was probably near 22 million. ((Keep in mind that JA had a PS2 pricecut the day MGS2 was released, but NA did not have any PS2 pricecuts before MGS2 released)) Whereas PS3 will have an installed base next April somewhere between 6.5-10.5 million. Thus, we can be pretty positive MGS4 will not reach 5 million, and may be lower than 4 million. Just based on this data.
Stealth games are as accessible as FPS games, depending on the type of stealth and type of FPS we are actually talking about. I don't think Splinter Cell is the best comparison. I do agree as a genre that stealth games aren't in the same league as a top quality FPS for sales, but there aren't that many top quality FPS that surpass the sales of MGS2, which strengthens my point in the beginning of this paragraph.
A price cut on the 80gb will come this holiday season, it has to, or the PS3 will have no chance in this generation against Wii & 360. Sony will have costs down enough by that time to make a pricecut, and the additional installed base will be better than no pricecut and lackluster software sales.
Regarding advertising, MGS4 will probably get at least 50% of the advertising that Gears received, maybe even as much or more, but we really can't tell right now. Konami did well financially this past year so that should help. And I think Konami would have much more money to be able to put up than Epic could've contributed to MS, so Sony + Konami adv. $ > MS + Epic adv. $.
But there is the MGS4 porting factor. If it comes to 360 the same day as PS3 then this stock would need to be at 50% of what it is, if it is a timed exclusive for PS3 this stock would need to go down to 65% of its current value. This is something that does not appear to be reflected in this stocks current price.
@Laoldar, I agree with Laoldar. The reason we know we can't compare this to the accessibility of Gears of War is that the previous MGS games were not nearly as accessible as GoW. MGS games in the past haven't pulled in large portions of the PlayStation userbase.
Additionally, I would also agree that stealth games are much less accessible than shooters. Shooters work for the casual player, pick it up and let loose some steam. Most casual players don't have the patience to be sneaking around and waiting for the right time to make the move in a stealth game. MGS gets its sales from people who like stealth games, and in large numbers because it is one of the best of the genre.
I'm not short on this game (too volatile since it's a high-profile stock, so I invest elsewhere), but my thoughts:
Previous MGS games - On consoles with over 100 million systes (PS/PS2) the game has only moved about 4-5.5 million and the lowest sales were for the latest in the series, which had the highest install base to work from. Why would sales be at the same level with only 10% as many consoles? Unless everyone who picked up MGS (not just fans of the series, but more casual players as well) is buying a PS3, it's not going to happen.
Accessibility/Genre - Stealth games (especialy a series that prides itself for its complex and intelligent storyline and isn't afraid to offend) aren't as accessible as gritty FPS games. Splinter Cell has yet to reach 3 million sold on ANY system, and that series' sales have been dropping steadily as well. As a genre, stealth games aren't even in the same league as a top-quality FPS for sales.
Will people buy any "top quality game"? A better question would be "Is there pent up demand for a cinematic stleaht game?". Also, Sony already had a price cut (and stores are advertising it as such). A price cut for the 80gb systems before next April would be nothing less than a move of desperation that would slaughter their revenues.
Advertising? I don't recall a ton of adverts for the previous MGS games, but I could be wrong. MS really hit it out of the park with their GoW ads, so Sony/Konami would have to really impress to get the same kind of response.
Question for those following this game...especially those shorting it.
Gears of War has been able to push 3 to 4.5 million on an install base of 10 million.
Assuming a March release and assuming Sony meets its targets of approx 10 million installed base by then (there MUST be a price cut coming!)...my question then is why would MGS not be able to garner similar sales (or more considering GOW launched when x install base was approx 6 million).
Is the game less accessible than GOW (I now it isn't the same type of game but is a shooter any more accessible than MGS type games?).
Is the pent up demand for a high quality game any less for PS3 than it was for X at the time?
Do we expect less over the top advertising of this game than GOW?
Just wondering about your thoughts (I am actually short on this but am reconsidering my position as I have the above questions).
1
Have to agree with jr on this one...
PS3 is supposed to drive the gaming division (thanks to PS2 they can/have taken their time), the Blu-ray movie division, helps drive the flat panel division and is central to SONY's future in digital distribution of their content.
SONY is currently looking at selling off its finance arm...raising approx 8 Billion USD in the process.