@drl21, I also have the same guidance as you : "this game will not reach 14 million, likely will not reach 10 million, and theres a good chance it will not reach 8 million, although I don't think 8 is really a safe bet either up or down"
Like I mentioned, 8 - 10 Million is a good neutral zone. The higher the price (higher than 10 Million) The better for short. The lower the price (lower than 8 Million) the better for going long.
I would say that in general Revenue and sales do correlate. Most if the time revenue falls and drops with sales. Profit may not necessarily correlate, I would give you that one. Still, I think it is a fair indication that PC sales are not the guarantee that they were. Consoles are doing more and more of what, 5 years ago, they could never do and only PC games could. Today theres simply less need for a game to be on PC. Keep in mind that this game is at least being looked into for a console release. While that is far from set in stone, if that does happen it will take considerable sales away from the PC. In general, all other things equal, (ability to play online, compatibility of controls) people would prefer to play a console version, at least that has been the trend recently.
Either way, no matter how you slice it, this game will not reach 14 million, likely will not reach 10 million, and theres a good chance it will not reach 8 million, although I don't think 8 is really a safe bet either up or down. I would sell anything over 9, and buy anything under 5 right now. I would say that the range between 5 and 9 is too iffy this far before release.
I'm confused too, I mean I shorted at 800 thinking this was wise. Diablo is simply not as popular globally as for instance Starcraft. How on earth does the TSE justify the current pricepoint?
Guess I'm just more bearish than the majority of TSE profiteers, or just not as good at reading investors. I tend to focus on the reality of the market rather than what others are doing. Often this means losing money :)
@drl21, This stock is very volatile. Whoever managed to short this stock at 140+ price point are now enjoying the profit. I was too late in getting into this stock.
Was there any game that have doubled the sales of their previous game ?
Just because more PC's are being sold does not mean that the PC gaming market is increasing. In regards to the percentage of annual game sales, PC sales are producing less earnings then console sales. Whether this is because PC games are less popular, or because consoles are more popular, is debatable. But overall, compared to consoles, PC games are not genorating the income that they used to.
You are most likely right. All you have done is confirmed my point that 14 million copies (which was the price as of my posting) is a gross over estimation. My point of it being 10 million was simply to demonstrate that 14 was too high. Your points are strong arguments towards even my 10 million being an overestimation. Either way the message is the same. Sell people, sell. Excitement has inflated the price of this stock far higher then it is likely to actually reach.
@drl21, Wait, because Diablo 2 has only been confirmed to have sold 4 million copies total, you're claiming it's safe to say Diablo 3 will sell 10 million? The PC gaming base has not doubled since 2006, hence Diablo 3 will have to appeal to a larger percentage of the total gaming market than before. If your claim that the PC market is shrinking is true, that exacerbates the situation even more. Furthermore, you say that we cannot expect Diablo 3 to sell WoW numbers -- 10 million is WoW numbers.
There are only 4 PC games ever confirmed to have breached 10 million units: The Sims, Lineage 2, The Sims 2, and World of Warcraft at 10 million. All of these games have players far outside the traditional gaming demographic that allowed them to reach such staggering numbers. You need something outside of the norm to occur to breach 10 million at this point. Presumably Starcraft will be confirmed at over 10 million units sometime in the future, but again, it will be because of its fanatical following in Korea.
I do not see Diablo appealing to the soccer moms and other non-core gamers. Nor do I see Diablo commanding the massive following that Starcraft has proven to with several Korean television stations broadcast ONLY Starcraft.
@drl21, I agree with most of your points, but I would like to point out quickly that the market for PC gaming is not dwindling. It has actually never been larger (due to the continually growing number of PCs that are bought by consumers each year). The market for PC gaming is merely changing (as it always is) and titles/genres that have previously sold well may not sell as well in the changing market.
This game will no doubt sell well, if nothing else just based on sheer name alone. On top of that, it is extremely likely that this will be a good game. However taking into account the fan base based on sales numbers of Diablo 2, I think that to estimate this came selling more then 10 million copies at this point in time is probably mostly excitement over the announcement. I'd say 10 million is a fairly safe number, but to estimate more than that right now would be a big risk. 14 is pretty chancy considering the dwindling market for PC gaming. We can not expect this game to sell WOW numbers even if it does have the same developers.
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I also have the same guidance as you :
"this game will not reach 14 million, likely will not reach 10 million, and theres a good chance it will not reach 8 million, although I don't think 8 is really a safe bet either up or down"
Like I mentioned, 8 - 10 Million is a good neutral zone. The higher the price (higher than 10 Million) The better for short. The lower the price (lower than 8 Million) the better for going long.