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).
@Deltaneutral, I know, thats why I am trying to put out periodic notes when I see stocks like this that have drifted up to the absurd range with their prices. We usually see them dip down and then pick up again over time.
@pilias_simber, the problem with these titles is that a lot of people think they sell a lot more than they do. Or we picked up a lot more new users and they tend to buy big name franchise games.
1
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).