Xbox One sells 1million units “worldwide” on day one

Microsoft confirms that the launch of the Xbox One was the best Xbox launch for the company yet.

Xbox One

Following the big launch of the Xbox One at midnight last night, Microsoft has just happily announced that the new console sold through 1 million units across 13 markets during its first 24 hours on sale. This marks a new record for the Xbox business, the company said. Supplies are also now limited. “Xbox One is now sold out at most retailers. We are working to replenish stock as fast as possible to meet the unprecedented demand from our customers,” Microsoft said.

“We are humbled and grateful for the excitement of Xbox fans around the world,” said Yusuf Mehdi, Corporate Vice President of Marketing and Strategy, Xbox. “Seeing thousands of excited fans lined up to get their Xbox One and their love for gaming was truly a special moment for everyone on the Xbox team. We are working hard to create more Xbox One consoles and look forward to fulfilling holiday gift wishes this season.”

Microsoft also mentioned some tidbits about gameplay milestones in the new games. In the last 24 hours, over 60 million zombies have been killed in Dead Rising 3, over 3.6 million miles have been driven in Forza Motorsport 5, over 7.1 million combos were put together in Killer Instinct, and over 8.5 million enemies have been defeated in Ryse: Son of Rome.

Sony’s PS4 also sold a million units in its first day, but it’s worth noting that the console still hasn’t shipped in Europe, unlike Xbox One. PS4 will launch across the pond on November 29.


Microsoft CEO Steve Ballmer to Retire ‘Within 12 Months’

Microsoft has issued a press release stating that its CEO, Steve Ballmer, will retire “within the next 12 months”, remaining in his position until a suitable successor is found. The precise reasons for Bullmer’s departure were not given, though he was quoted as saying:

There is never a perfect time for this type of transition, but now is the right time…we have embarked on a new strategy with a new organization and we have an amazing Senior Leadership Team. My original thoughts on timing would have had my retirement happen in the middle of our company’s transformation to a devices and services company. We need a CEO who will be here longer term for this new direction.

The stock market reacted positively to the news, with Microsoft’s share price opening 8% higher than the previous day’s closing.


(Image courtesy of Mashable)
Ballmer joined Microsoft in June 1980 and became the company’s 35th employee, having been a business manager recruited by Bill Gates, the former chief executive and chairman of the company. Ballmer was named CEO in January 2000, and throughout his tenure was responsible for some key changes in Microsoft as a company, including the shift towards cloud computing, key business acquisitions such as that of Skype in May 2011 and the release of Microsoft’s first consumer tablet device, the Surface, back in June 2012.

However, Ballmer’s tenure has not been without criticism. Microsoft’s share price has remained fairly stagnant under his leadership and the disappointing sales of the Surface have further sprinkled salt into the wound. He was also criticized concerning his remarks about Apple at a press conference back in 2009, where he described the company’s products as, “$500 more to get a logo”.

Microsoft’s Board of Directors has appointed a special committee to direct the process of replacing Ballmer as CEO. The committee, which includes Bill Gates as one of its members, will be working with an executive recruiting firm, Heidrick & Struggles, to find a replacement. The press release also stated that Microsoft, “will consider both external and internal candidates”, although no official job announcement has been made as of yet.



The Fast-Growing Latin American Games Market

Okam Studio co-founder Martina Santoro on the perks and pains of the fast-growing Latin American games market.


The borders of the gaming industry are frequently drawn around the US, Europe, and Asia, but there are lots of developers–and potential customers–beyond those lines. Martina Santoro, co-founder and director of Buenos Aires, Argentina-based developer Okam Studio, has been trying to convince people of this. Santoro has been digging up research on the Latin American market specifically, and presented her findings in May at the Ottawa International Game Conference.

Speaking with GamesIndustry International last week, Santoro said it was a difficult process because there are only a few people really researching the Latin American market at the moment, but some of her findings suggest there should be a lot more. Santoro said there are about 60 million smartphones in Latin America, half of which are regularly used for gaming. On top of that, the region has shown the fastest smartphone growth in the world. And in terms of spending power, the Latin American market is comparable to China. According to Alta Ventures, China’s population of 1.3 billion commands an average disposable income of a little over $2,200 per person ($2.9 trillion in total). The population of Latin America is less than half that, about 594 million, but commands an average disposable income over $4,700 ($2.8 trillion total).

“The amount of mobile devices [in Latin America] is doubling every year,” Santoro said. “The biggest market is still Brazil, but it’s amazing how in countries like Argentina, Chile, Mexico, Bolivia, Peru, Colombia, the access to information and the internet is growing very, very fast. I wasn’t really expecting that.”

Martina Santoro

Martina Santoro

Unfortunately, the biggest attractions of the Latin American market–its growth–goes hand-in-hand with its biggest challenges. The gaming industry there is still young, and it lacks some of the infrastructure one might take for granted in a more established market. The single biggest challenge Santoro pointed to is payment methods. Credit cards aren’t as ubiquitous in Latin America as they are in the US and Europe, and even for those with credit cards, paying for content from another country can carry surcharges. Billing directly to users’ carriers isn’t a viable alternative, partly due to infrastructure issues and partly because telecom companies can require an exorbitant cut of revenues for games purchased that way. Publishers have been working around the issue to date with tactics like selling pre-paid cards in drug stores and super markets or having people pay by SMS, the same way charities might collect donations here. These hurdles impact the business model, which in turn impacts the games being made. For example, game developers have had to learn that designing games that rely on impulse purchases isn’t nearly as effective in Latin America.

“[W]e’ve had companies that have grown a lot for big projects and then needed to downsize…For a strong industry, we’ll need more projects to come in and maintain the studios.”

Martina Santoro

Piracy and localization are two more concerns publishers have had with working in Latin America, but Santoro said both situations are improving. Digital distribution and the free-to-play business model have both helped cut down on piracy, and Steam in particular has proven more successful than many retail stores in the region. As for localization, Santoro said companies are starting to put more effort into the task, and are being rewarded for it. One faux pas she sees less these days is the use of Iberian Spanish instead of Latin American Spanish.

“For many years, the products for here were dubbed by Spanish people,” Santoro explained. “So gamers, especially hardcore gamers, preferred to buy games in English directly from the US. So when big studios did their marketing research, the results said that Latin Americans weren’t spending money on games. But the fact was they were; they were just spending it in the US market.”

For Latin American developers, the industry’s youth can be seen in the difficulty of educating new hires. Santoro said there’s plenty of talent in Argentina, but there are few academic programs to shape them into professional game developers. And without colleges teaching how to do this for a living, people might not even consider development as a possible career.

“On the human resources side, in Argentina it’s pretty hard to tell your parents you’re going into the video game industry,” Santoro said. “If you studied programming, then it’s something your parents think is good because you’ll work for a bank or something. But it’s difficult when you tell your parents you’re going to start a video game studio and make games when they don’t have a clue what you’re going to do. My mother doesn’t know what I do. She doesn’t get it. She accepted it after a time, but not everyone knows it’s an option to make a living out of this.”

One more problem Okam and other Latin American developers have had to face is the at-times inconsistent flow of available work.

“We’re trying to create an industry, so it’s been hard to get the projects going in a very fluid way,” Santoro said. “So we’ve had companies that have grown a lot for big projects and then needed to downsize. Stuff like that happens all the time. For a strong industry, we’ll need more projects to come in and maintain the studios so people can grow and get more experience.”

FoosballOkam is working on a mobile game for the upcoming movie Foosball

Challenges aside, Santoro said she’s had some substantial advantages as a Latin American developer. Naturally, her team has a leg up making games targeted for the Latin American market, but Santoro said Okam’s location in Buenos Aires means the studio is well-suited to creating content for the North American and European markets. Part of that is that the city’s cosmopolitan makeup provides developers with an understanding of what works for global audiences, such as cultural tastes or sense of humor. On a practical level, Santoro noted Okam’s time zone is shifted four hours from San Francisco and four hours from London, making regular conference calls possible without requiring odd hours. There are financial benefits as well, with government tax credits and

“We are kind of cost-efficient,” Santoro admits. “We have highly trained professionals, and our costs for each of our team members is really low compared to big production houses in the US or Europe.”

That’s made studios like Okam attractive for foreign publishers looking to create less expensive games for their own markets, but Santoro says there’s a shift going on.

“We’ve been learning a lot on how to make games for other markets,” Santoro said. “Now it’s changing. Games in Latin America are being made for Latin American consumers, so it should be interesting to know what we’re able to do.”

Okam is currently working on a number of projects, including a mobile game for the upcoming CG movie Foosball, and another project based on Dark Horse Comics’ Dog Mendonça and PizzaBoy series about an overweight Portuguese werewolf and his unpaid intern.



Activision Blizzard goes independent as Kotick leads $8.2 billion buyout

Kotick and Kelly form separate investment group with Tencent as publisher also buys shares

Activision Blizzard goes independent as Kotick leads $8.2 billion buyout

Activision Blizzard is to become an independent company as CEO Bobby Kotick leads an investor buyout from Vivendi worth $8.2 billion.

The publisher of World of Warcraft and Call of Duty will buy 439 million shares from Vivendi for $5.83 billion. In addition, an investment group led by Kotick and co-chairman Brian Kelly, will purchase 172 million shares worth $2.34 billion.

With Vivendi no longer a major stakeholder, Activision Blizzard becomes an independent company led by Kotick and Kelly, whose investment group also includes Chinese operator Tencent, Davis Advisors and Leonard Green & Partners.

“These transactions together represent a tremendous opportunity for Activision Blizzard and all its shareholders, including Vivendi,” said Kotick.

“We should emerge even stronger-an independent company with a best-in-class franchise portfolio and the focus and flexibility to drive long-term shareholder value and expand our leadership position as one of the world’s most important entertainment companies. The transactions announced today will allow us to take advantage of attractive financing markets while still retaining more than $3 billion cash on hand to preserve financial stability.”

Kotick added, “Our successful combination with Blizzard Entertainment five years ago brought together some of the best creative and business talent in the industry and some of the most beloved entertainment franchises in the world, including Call of Duty and World of Warcraft. Since that time, we have generated over $5.4 billion in operating cash flow and returned more than $4 billion of that to shareholders via buybacks and dividends. We are grateful for Vivendi’s partnership through this period, and we look forward to their continued support.”

Kotick’s investment group will hold around 24.9 per cent of the company, with Kotick and Kelly investing $100 million combined of their own cash. Vivendi will continue to hold around 12 per cent of shares.



Perfect World suffers in the wait for new games

Revenue, profits and players all down in Q1 as online firm concentrates on pipeline

Perfect World suffers in the wait for new games

A lack of new games and content saw Perfect World’s business slow down on all fronts in the first quarter.

In the three-month period ended March 31, 2013, Perfect World’s revenue was RMB624.5 million ($102m/£68m), slightly down from RMB718.5 million in the prior year quarter. Net profit was RMB131 million ($21.4m/£14.1m), a more precipitous year-on-year decline from RMB209.8 million.

The steep drop in profits was due in no small part to higher levels of expenditure on R&D as the company attempts to address a similarly sharp decline in player numbers: Perfect World’s aggregate concurrent users have fallen from 804,000 in Q1 last year to around 554,000.

“During the quarter, we continued to primarily focus on developing new content for our portfolio and pipeline and slow down promotional activities,” said Perfect World CEO Robert Xiao in a statement. “As we expected, the overall performance of our existing games in the first quarter was softer, but we are pleased with the recent progress we have made in our portfolio and pipeline development.”

Perfect World has several major launches planned for this year: Cryptic Studios’ Neverwinter in North America and Europe, and Swordsman Online and Dota 2 in mainland China.