Under pressure
Speaking to The Times, Activision Blizzard CEO Bobby Kotick questioned whether it's worth his company continuing to support Sony's PlayStation 3, with attach rates remaining lower than hoped.
"I'm getting concerned about Sony; the PlayStation 3 is losing a bit of momentum and they don't make it easy for me to support the platform," he said in the interview. "It's expensive to develop for the console, and the Wii and the Xbox are just selling better. Games generate a better return on invested capital on the Xbox than on the PlayStation.
"They have to cut the price, because if they don't, the attach rates [the number of games each console owner buys] are likely to slow. If we are being realistic, we might have to stop supporting Sony. When we look at 2010 and 2011, we might want to consider if we support the console - and the PSP [portable] too."
A look at Activision Blizzard's market cap reveals it is, perhaps surprisingly, worth more than twice as much as the historical dominant player: Electronic Arts. While a lot of this is down to the merger with Blizzard, and the consequent acquisition of hugely successful MMO World of Warcraft, it's thought other innovative games like Guitar Hero are responsible for Activision's strong position.
This looks like a pretty unambiguous signal to Sony: find a way of increasing the install-base of PS3s or risk losing the support of the world's biggest games publisher. We therefore wouldn't bet against a round of PS3 price cuts soon.
Do you own a PS3 and if not what has prevented you buying one? Is it too expensive? Let us know your thoughts in the HEXUS.community discussion forums.
