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[KoopaTheCasual]

wrong.

http://www.neogaf.com/forum/showthread.php?t=891704&highlight=

“Activision is, too. But the budget for Destiny, including associated marketing costs and pizza Wednesdays, is nowhere near 500 million dollars.”

http://www.gamespot.com/articles/destiny-budget-nowhere-near-500-million-bungie-says/1100-6420802/

 

[Boss Man]

I'm sure we'll stop seeing cross generation aim-down-sight shooters any day now after this.

 

[Necromanti]

http://www.gamespot.com/articles/destiny-budget-nowhere-near-500-million-bungie-says/1100-6420802/

That seems consistent, though:

Responding to a question from a fan, Bungie’s Eric Osborne repeated the developer’s Chief Operating Officer Pete Parsons’ explanation: “For marketing you'd have to ask Activision people, but for development costs, not anything close to $500 million,” Parsons told GameIndustry International in an interview.

No one's saying that all that money went into the development of the game, since a large part of that would go into expenses like marketing.

 

[Xplatformer]

It's going to make as much as Bungie can make DLC.


Create OLD Los ANGELES for $40, SOLD.

Create the Fallen HOME PLANET for $30. SOLD.

Add SPACE COMBAT...for $30, SOLD.


It's very vanilla now, but dis about to be the new Star Wars franchise.

 

[KoopaTheCasual]

That seems consistent, though:

No one's saying that all that money went into the development of the game, since a large part of that would go into expenses like marketing.

But in the second (my) quote, he goes on to assert that even with marketing it's not $500 million.

Edit: the original $500 million quote is vague enough, that it probably is a lifetime budget including sequels.

 

[Asd202]

Those September NPD results will be glorious.

 

[Necromanti]

But in the second (my) quote, he goes on to assert that even with marketing it's not $500 million.

Edit: the original $500 million quote is vague enough, that it probably is a lifetime budget including sequels.

True, but the first quote was said by the COO of Bungie, rather than their community manager (to which the second quote is attributed). I assumed he'd have a better idea of where the money would be going. I'm guessing the point is that it wasn't towards Bungie's marketing where those funds were going, but Activision's (and Activision had some deal with Sony as well). That was my impression, at least.

 

[cnorwood]

Destiny didn't do $500 million in a single day. This is retailers anticpating sell through. The question is will a Mario game do $500 million eventually and the answer is chances are good. Most of these copies are going to sit in warehouses for a long time.

Well from what I see the only Marios game that would've sold ~$500m in one day is Super Mario Galaxy 11.09m , and thats assuming every copy was sold at $50. And new super Mario bros wii , But that was bundled with the wii for a while. No other recent games even come close.

 

[KoopaTheCasual]

True, but the first quote was said by the COO of Bungie, rather than their community manager (to which the second quote is attributed). I assumed he'd have a better idea of where the money would be going. I'm guessing the point is that it wasn't towards Bungie's marketing where those funds were going, but Activision's. That was my impression, at least.

Weird, I always thought the quotes were the same person. I do find it weird that Bungie employees don't know for sure, and that Activision only poetically puts the $500 million as long term investment.

I still think it means the franchise, not the game.

 

[bigmit3737]

London, UK – 10th September, 2014 – Activision Publishing, Inc., a wholly owned subsidiary of Activision Blizzard, Inc. (Nasdaq: ATVI), announced today that the company sold more than $500 million of Destiny into retail stores and first parties worldwide as of day one, making the game the biggest new video game franchise launch in history.

Yeah, it's sold-in, not sold-through.

I'm confused. Activision sold $500 million of Destiny into retail stores .

So that's at the price of what Activision sold to retailers and not retail price right ?

 

[Shpeshal Nick]

Just the be clear. That's sarcasm right? Because there seem to be plenty of crazies that actually do believe that crap.

You believe marketing doesn't sell games?

 

[jrDev]

The videos I've seen are first person, can I play this in third person and join the fun? :/

 

[BishopLamont]

I thought Titanfall was the best selling XB1 title...

Doesn't change the fact that TF will sell less than Destiny.

Despite MS, EA, and Respawn (and Respawn employees on GAF) all saying they were happy with the game's sales, despite a sequel being greenlit, and despite it being the best selling title on Xbox One, there is a sizeable community who still believed the game 'flopped' according to their personal standards.

I never said it flopped, just that EA is behind Activision again with their shooter wars.

If any Mario game sold 500m in even the first week, do you think nintendo would be quiet about it?

And I did say recent Mario game, with the sales of the Wii u, there isnt going to be a Mario game that has the same success as Destiny for quite a while.

Well its obvious no recent Mario has sold that quick, Nintendo hardware hasn't been faring well lately, not really sure why it has to be a recent Mario game either.

Mario was just a bad example you used, just accept that and move on, especially since it sells big amounts pretty quickly, maybe not first day but thats obvious with the nature of the game.

 

[Dire]

Well being the most pre ordered ip in history would probably mean that they shipped copies they think they could sell. Shipping $500m of any current Mario game probably wouldnt be as smart

Once again you're being misled by Activision PR.

Destiny is the most preordered new ip. The difference is not small. It's like how they can state that Destiny is the biggest new franchise launch, even though the $500m shipped is actually less than half of what CoD Ghosts shipped, even less than what CoD: Black Ops 2 shipped and all of those are dwarfed by something like GTA 5, etc.

 

[TAJ]

Like lambs to the DRM slaughter.

 

[TKM]

I'm confused. Activision sold $500 million of Destiny into retail stores .

So that's at the price of what Activision sold to retailers and not retail price right ?

Right, it's at the price Activision sold to retailers and Sony (for Destiny PS4 bundle). THe press release doesn't specify whether it's gross revenue or net revenue so the number could differ. Net revenue would subtract for estimated returns and price protection. For Day 1 though, I wouldn't expect a large reserve for returns or PP. So gross and net revenue should be closer.

Overall, we recognize revenues from the sale of our products upon the transfer of title and risk of loss to our customers and once any performance obligations have been completed. Certain products are sold to customers with a “street date” (which is the earliest date these products may be sold by retailers). For these products, we recognize revenues on the later of the street date or the date the product is sold to the customer. Revenues from product sales are recognized after deducting the estimated allowance for returns and price protection.

Activision watches weekly sell-through very carefully and uses reorder data to estimate the need for future price cuts or allowances for returns. Outright returns of non-defective products are rare in the game biz. Usually marked down until it sells.

We closely monitor and analyze the historical performance of our various titles, the performance of products released by other publishers, market conditions, and the anticipated timing of other releases to assess future demand of current and upcoming titles. Initial volumes shipped upon title launch and subsequent reorders are evaluated with the goal of ensuring that quantities are sufficient to meet the demand from the retail markets, but at the same time are controlled to prevent excess inventory in the channel. We benchmark units to be shipped to our customers using historical and industry data.

We may permit product returns from, or grant price protection to, our customers under certain conditions. In general, price protection refers to the circumstances in which we elect to decrease, on a short- or longer-term basis, the wholesale price of a product by a certain amount and, when granted and applicable, allow customers a credit against amounts owed by such customers to us with respect to open and/or future invoices. The conditions our customers must meet to be granted the right to return products or price protection include, among other things, compliance with applicable trading and payment terms, and consistent return of inventory and delivery of sell- through reports to us. We may also consider other factors, including the facilitation of slow-moving inventory and other market factors.

 

[TKM]

This is correct. Think of it this way, Activision likely takes down 50% of the $60 for a game and the rest is split amongst the retail markup, console manufacturer and the printer.

If Activision is really booking $500M of revenue then this infers they put 17M copies of the game on the shelves ($500M * 2)/$60. If the $500M represents the aggregate value of the copies of Destiny sold to retailers then take ($500M/$60) or 8M copies. Which makes more sense?

No that's an odd way of looking at it. Both scenarios are wrong. Activision would report net revenue and costs of sale (product costs, software royalties, etc) separately. $30/unit is not net revenue.

Neither is $60. The $60/unit is revenue to Walmart, not Activision. Activision's gross revenue might be $51.99/unit less 1% allowance for returns = $51.47/unit net revenue.

 

[jcm]

There's nothing about the phrase "the company sold more than $500 million of Destiny" that would lead me to believe that the $500 million is revenue for Activision. Unless you're aware of something beyond that statement, in which case please do share, that phrase looks to say, as far as I'm reading it, that the $500 million refers to the value of the games in terms of what the consumers will pay, which may equate to income for the retailers, but certainly not Activision.

It's in the actual PR on the Activision IR site:
"Based on extraordinary audience demand, retail and first party orders worldwide have exceeded $500 million for Destiny," said Bobby Kotick, CEO of Activision Blizzard. "This industry milestone marks another blockbuster success for our company and demonstrates our unique ability to create some of the most successful entertainment franchises in the world. The success of Destiny, along with the recent introduction of Blizzard Entertainment's Hearthstone, is further validation of our unique capabilities to create great entertainment franchises from the ground up."

This is correct. Think of it this way, Activision likely takes down 50% of the $60 for a game and the rest is split amongst the retail markup, console manufacturer and the printer.

If Activision is really booking $500M of revenue then this infers they put 17M copies of the game on the shelves ($500M * 2)/$60. If the $500M represents the aggregate value of the copies of Destiny sold to retailers then take ($500M/$60) or 8M copies. Which makes more sense?

That math is just wrong. First of all, they get about $45 a copy for physical versions. But they also have collectors versions and digital versions and the bundled software they sold to sony. You can't calculate units from revenues, but their revenue per unit is much more than $30.

 

[DidntKnowJack]

The videos I've seen are first person, can I play this in third person and join the fun? :/

No, it's a first person shooter. The only time you're in 3rd person is on the hub world where all the merchants are.

 

[Bold One]

Bobby Kotick can now get that island he had his eye one, thats made of cocaine

fixed

 

[Blackstarhat]

Did it beat GTA V? I thought GTA made 500 mill during its launch too.

GTA V made $800 mill first day.

 

[Sotha_Sil]

At least this and Watch Dogs have proven there is a desire for new IPs.

 

[Log4Girlz]

McDonalds makes a lot of money too, doesn't mean it's good for you

You're saltier than their fries

 

[AngryMoth]

I'm really interested to find out the current vs last gen sales breakdown. My guess is 2/3rd next gen, always felt like pubs are being overly cautious with cross gen releases this fall.

 

[PFD]

You're saltier than their fries

lol

 

[Dire]

Did it beat GTA V? I thought GTA made 500 mill during its launch too.

GTA V made $800 mill first day.

People are once again confusing sell-in vs sell-through.

Activision announcement = We put $500million of product on store shelves and in storage rooms! Consumers bought up $??? of that in the first 24 hours!!

GTA 5 announcement = We put $??? of product on store shelves and in storage rooms! Consumers bought up $800million of that in the first 24 hours!!

GTA 5 was sell-through. Activision's number is sell-in. Sell-through tells you how much is selling. Sell-in is a relatively useless figure that tells you how much you allocated to hopefully be sold eventually.

And since you're responding to somebody who's also being misled. Destiny PR states it's having the biggest new franchise launch in history. Once again the details matter here. That means they're only comparing it against non-sequels: Titanfall, Ass Creed 1, Halo 1, stuff like that.

 

[Jimmyfenix]

I'm really interested to find out the current vs last gen sales breakdown. My guess is 2/3rd next gen, always felt like pubs are being overly cautious with cross gen releases this fall.

I can agree with this. I expect more companies to go down the Warner route and delay the last gen version of games.

 

[sant]

How long have you played it though? The game has a bad case of Assassin's Creed face where it's legitimately a fun game with beautiful art...until you play it for a while and realize it's also doing the same stuff over and over and over. Hopefully, Destiny 2 is the giant leap forward that AC2 was.

Poster's note: I still like the game and am still playing it but not sure for how long

I've played it for about 4 hours, been enjoying it so far.

 

[Shingro]

Ok. Say what you want about Kotick but the man is an amazing businessman. Activision..... Just holy moly....

Whatever devil horn photoshops exist I'll be thankful he avoided falling into the mobile trap and always has invested in games for the more hardcore audience.

(of course, skylanders and such aren't, but they were good from what I've heard)

 

[MrTroubleMaker]

I wonder what the sell-through number is.

 

[SparkTR]

At least this and Watch Dogs have proven there is a desire for new IPs.

That are disappointingly similar to existing IPs in many ways. I knew that there would be a push for new IPs during these first few years (before publishers start settling later on ), I just didn't expect them to be so stale. It's going to get so much worse that last generation.

 

[IdreamofHIME]

GTA V made a billion in three days, could beat that record.

Jesus Christ, it's the same spin as last year with COD. This is how much Acti made selling the game to retailers. How much stock those retailers bought and have sitting on shelves.

GTAV made 1 billion in sales to public in 3 days, not retailers....the public.

Do you not see the difference and how Kotick is spinning this?

 

[speculawyer]

Remember when they were saying that consoles were dead? I think not.

 

[Ingueferroque]

Jesus Christ, it's the same spin as last year with COD. This is how much Acti made selling the game to retailers. How much stock those retailers bought and have sitting on shelves.

GTAV made 1 billion in sales to public in 3 days, not retailers....the public.

Do you not see the difference and how Kotick is spinning this?

And you are spinning it as if most Destiny copies are still sitting on shelves? Okay.

 

[IdreamofHIME]

And you are spinning it as if most Destiny copies are still sitting on shelves? Okay.

Well I never said that, but you see it. Tells me a lot about your obsession with a game....not healthy.

 

[Paracelsus]

Remember when they were saying that consoles were dead? I think not.

I'm pretty sick and tired of this argument.

If Destiny sells 45 millions in a month but Yakuza 4 sells 20-50k and Bayonetta sells 800k then yes, consoles are pretty much dead because it's not an all-around healthy environment. It only means the market is dead unless you make a huge stereotypical blockbuster (whether it's good or not is a separate issue) and have at least twice the budget money to market it.

 

[Ingueferroque]

Well I never said that, but you see it. Tells me a lot about your obsession with a game....not healthy.

Haha, I barely played 2 hours. No time.

 

[Trust me. I'm a PhD]

Those September NPD results will be glorious.

I am hoping that PS4 and Xbox do a bigger number than any past September. October, November, and December will be strong regardless, but expanding the holiday sales season by and extra month would be an exceptional start to gen 8^^ Out side of Halo 3 there wasn't any big September releases last gen, correct?

 

[jholmes]

It's in the actual PR on the Activision IR site:
"Based on extraordinary audience demand, retail and first party orders worldwide have exceeded $500 million for Destiny," said Bobby Kotick, CEO of Activision Blizzard. "This industry milestone marks another blockbuster success for our company and demonstrates our unique ability to create some of the most successful entertainment franchises in the world. The success of Destiny, along with the recent introduction of Blizzard Entertainment's Hearthstone, is further validation of our unique capabilities to create great entertainment franchises from the ground up."

Nothing about that quote mentions or even infers that figure refers to Activision revenue. It says plain as day -- retail and first party orders, as in what people are spending to get the game.

I'm pretty sick and tired of this argument.

If Destiny sells 45 millions in a month but Yakuza 4 sells 20-50k and Bayonetta sells 800k then yes, consoles are pretty much dead because it's not an all-around healthy environment. It only means the market is dead unless you make a huge stereotypical blockbuster (whether it's good or not is a separate issue) and have at least twice the budget money to market it.

Indeed. I have really no opinion on Destiny but the idea that this game is somehow a barometer of the industry's health is a joke. If anything, it shows just how much companies have to spend just to get the attention of the market.

 

[jcm]

Nothing about that quote mentions or even infers that figure refers to Activision revenue. It says plain as day -- retail and first party orders, as in what people are spending to get the game.

Retail orders means orders from retailers, which are Activision's customers.

 

[BokehKing]

I'm sure we'll stop seeing cross generation aim-down-sight shooters any day now after this.

What is wrong with ads?
Why must we live in the 90's with fire from the hip shooters instead?

 

[jholmes]

Retail orders means orders from retailers, which are Activision's customers.

And those total $500 million.

Honest question and I promise I'm not trying to be condescending: Do you know what revenue means?

 

[ZeroX03]

No, it's a first person shooter. The only time you're in 3rd person is on the hub world where all the merchants are.

Not exactly, it's also third person when you're on your hoverbike thingy and when using a certain weapon. And the little d-pad communications and some super moves I think.

 

[DangerMouse]

The videos I've seen are first person, can I play this in third person and join the fun? :/

Also, those third person screen shots, like in the share thread, make me think about how great it would be too since I also prefer third person to first person.

 

[DaleinCalgary]

Okay people sales of 500 million is not the same as 500 million profit.

 

[Renekton]

And those total $500 million.

Honest question and I promise I'm not trying to be condescending: Do you know what revenue means?

I need to know too.

What's the official definition of revenue when it comes to retailing?

Do you subtract the retailer/psn cut first? I assume expenses like shipping are not subtracted first?

 

[Some Nobody]

I'm pretty sick and tired of this argument.

If Destiny sells 45 millions in a month but Yakuza 4 sells 20-50k and Bayonetta sells 800k then yes, consoles are pretty much dead because it's not an all-around healthy environment. It only means the market is dead unless you make a huge stereotypical blockbuster (whether it's good or not is a separate issue) and have at least twice the budget money to market it.

lol, great post but awful examples.

And all the people trying to spin this as "well, it's just sold-in" are kidding, right? This game's a guaranteed hit. The pre-order sales were through the roof, and those are sold-through. Is it GTA V level? Well of course not, but it's still going to put up stupid numbers before the year is out.

 

[jcm]

And those total $500 million.

Honest question and I promise I'm not trying to be condescending: Do you know what revenue means?

I think you're confused. Activision sells to retailers. Activision's revenue is the amount the retailers pay them for their games. That's who Activision's customers are, that's whose orders of the game totaled $500M. Activision can't be talking about $60 sales to gamers, because they're talking about sell-in, not sell-through. The "retail orders" in the press release is referring to retailers ordering product from Activision.

I need to know too.

What's the official definition of revenue when it comes to retailing?

Do you subtract the retailer/psn cut first? I assume expenses like shipping are not subtracted first?

TKM posted it earlier on this page, straight from the Activision annual report.

Overall, we recognize revenues from the sale of our products upon the transfer of title and risk of loss to our customers and once any performance obligations have been completed. Certain products are sold to customers with a “street date” (which is the earliest date these products may be sold by retailers). For these products, we recognize revenues on the later of the street date or the date the product is sold to the customer. Revenues from product sales are recognized after deducting the estimated allowance for returns and price protection.

Activision's revenue is the amount the retailers pay them for the game.

 

[Dubz]

Jesus Christ, it's the same spin as last year with COD. This is how much Acti made selling the game to retailers. How much stock those retailers bought and have sitting on shelves.

GTAV made 1 billion in sales to public in 3 days, not retailers....the public.

Do you not see the difference and how Kotick is spinning this?

Now matter how you slice it. This game is huge for Activision, and we will see a lot more Destiny products in the future

 

[SRTtoZ]

Awesome games deserve awesome numbers.