Top
460°

Metal Gear Solid 5 will reportedly have to double its current 3 million sales in order to break even

From GameWatcher: "Huh, no wonder Konami's reluctant to get back into triple-A video game development. Forbes reports that development costs for the publisher's latest title, Metal Gear Solid 5, hit nearly $80 million.

That's not including marketing or distribution, which means that the game will presumably have to double its current figure of 3 million copies sold in order to break even."

The story is too old to be commented.
NewMonday1121d ago (Edited 1121d ago )

Metal Gear 4 did about 6 million on the PS3 alone and it launched when the console had a very small market share.

6 million on 5 platforms should be easy, probably by the end of the year, after that its all profits.

freshslicepizza1121d ago

exactly, which is why making games multiplatform makes sense for big budgeted games from third party publishers. 3 million in such a short time is very good for any game.

NewMonday1121d ago (Edited 1121d ago )

multi-platform envelopment is what inflated the budget in the first place, its a high risk high reward situation, if you are confident your game will be a hit its a no brainier, Witcher 3 had a similar budget and they are selling great now according to CDPR

if want to play it safe developing for the PS4 only or before starting on other platforms is what many developers are doing with games like NiOh, Dragon Quest, SOMA..etc, this was something CDPR did by making Witcher 2 only for 360

Shadowsteal1121d ago

@NewsMonday

This is false. Witcher 3 development and marketing cost was $60-$70 million. They stated they've made $300 million back in June of this year. Please do not spout misinformation, as there are expensive AAA titles but Witcher 3 wasn't one of them, Heavy Rain was another that multiplied its coat in profits. The articles can easily be found by googling "Witcher 3 $35 million".

XBLSkull1121d ago (Edited 1121d ago )

It is ironic the people who side with Kojima in the imaginary "Kojima vs Konami" battle genuinely don't seem to like this game very much, and then you take in the fact the game needs to double its sales to break even... Konami is definitely in the right for releasing the game and getting rid of Kojima. Kojima put the game way over budget and if he had his way the game likely would have never gotten finished.

That being said this is easily the best MGS title to date, the great gameplay remains while most of the crap story and super, super, super super super excessive cutscenes are virtually non-existent.

@NewMonday
"multi-platform envelopment is what inflated the budget in the first place, its a high risk high reward situation"

multi-generation I think is what you meant. PC/X1/PS4 are close enough in architecture that it doesn't take a lot of effort to make all those versions. Throw in last gen 360 architecture and a cell processor and then you are starting to make a valid point.

freshslicepizza1121d ago

@NewMonday
"multi-platform envelopment is what inflated the budget in the first place"

false. mgs4 had a budget of 60 million and that was only for one platform and that was also back in 2008.

"its a high risk high reward situation, if you are confident your game will be a hit its a no brainier, Witcher 3 had a similar budget and they are selling great now according to CDPR"

it's actually less risk, which is why so many games are indeed multiplatform. most of your comments reflect your complete bias in favor of the plasytation which is why debating with you is fruitless and goes nowhere.

"if want to play it safe developing for the PS4 only or before starting on other platforms is what many developers are doing with games like NiOh, Dragon Quest, SOMA..etc, this was something CDPR did by making Witcher 2 only for 360"

mgs sells well outside of japan which is why it makes sense to be multiplatform more so than games like nioh.

let's all just be happy konami decided to make this game multiplatform because if it was up to you the xbox and pc would be getting far less support than it currently does.

bouzebbal1120d ago

Iam going to buy it used I refuse to give these morons my money.

Tzuno1120d ago

If you think how many people are on this earth 3M is a minuscule minority, makes me wonder how many gamers are out there? well not to many with a bright mind.

Gwiz1120d ago

Making MGS:TPP multi platform was still a risk.
The game sold 6 million on the PS3 right?and was considered a system seller.If they only had to develop it for PS4 it could be a much lower budget plus Sony could've helped here and there as well (the latter is probably no longer the case because of Sony's financial position)Multi Platform doesn't always mean less risk,the financial risk could potentially be bigger because you're not part of a company that depends on your game (meaning MS,Sony and w/e).

NewMonday1120d ago

@Shadowsteal

"CEO Adam Kicinski revealed the game’s total budget – including development and marketing costs – as 306 million złoty or about $81 million USD"

http://gamingbolt.com/the-w...

@moldybread

"It's being written in recent news that MGS4's budget was over 5 billion [yen] or 7 billion yen($60 million), Imaizumi tweeted. It didn't cost that that much. If it cost that much, Imaizumi added, the game would've become multi-platform."

no apologies needed guys everyone makes mistakes

but do your homework first next time :P

Mainman1120d ago

I'm sure the development of FOX engine is also part of this supposed budget of MGS5?

If that's the case then we got to keep in mind that the FOX engine was also used in other games like PES and MGS5:GZ. And it's at their disposal for future games as well, and they can potentially license the engine to third party developers as well.

My point is, it may not be as black and white as we think.

And the way MGS5 has been received by the public, I'm sure it will sell more than 6 million.

freshslicepizza1120d ago

@NewMonday,
"It's being written in recent news that MGS4's budget was over 5 billion [yen] or 7 billion yen($60 million), Imaizumi tweeted. It didn't cost that that much. If it cost that much, Imaizumi added, the game would've become multi-platform."

then what was the cost including marketing? oh that's right, they refuse to comment.

you also neglected to mention why games become multiplatform in the first place, it takes away some of the risk due to high cost. not more risk. why else do most aaa games become multiplatform? again you have no answer.

like i said, if it was up to you the pc and xbox one would be getting even less support which is why your input in regards to anything about games being multiplatform is redundant.

nosferatuzodd1120d ago (Edited 1120d ago )

Great Xboxskulls is at it again lol

NewMonday1119d ago

@moldybread
"If it cost that much, Imaizumi added, the game would've become multi-platform."

cant help you out if you ignore actual official sources.

as for multi-platform development, that requires hiring an external dev, or growing the manpower of the studio, that requires having constant projects to get constant income, and you need them to be constantly successful.

freshslicepizza1119d ago

@NewMonday,
"as for multi-platform development, that requires hiring an external dev, or growing the manpower of the studio, that requires having constant projects to get constant income, and you need them to be constantly successful."

like i said, if it was up to you the pc and especially the xbox one would get far less support than what we see. thankfully that isn't the case. we have also seen less exclusives over the years from third party which is why your input in games going multiplatform is moot.

+ Show (10) more repliesLast reply 1119d ago
1121d ago Replies(4)
caseh1121d ago

Don't forget the DLC as well and things like people purchasing MB coins will generate a load of income that wouldn't be tracked.

1121d ago
caseh1121d ago (Edited 1121d ago )

The MB coins are also used in the FOB section of the main game for expanding the base and there are many people (can see them when scanning bases to infiltrate) who have bought enough to set up additional bases.

The MB coins are basically a no expense open-ended income for Konami.

stiggs1120d ago

@NewMondy

"multi-platform envelopment is what inflated the budge"

You have no idea what you are talking about.

ZombieKiller1120d ago

Kind of have to wonder if this had anything to do with the Kojima/Konami fallout. It really seems as if they just don't see eye to eye patch on the matter. I hope the future of MGS turns out to be a good future. I could care less about any of their other games. Maybe they'll get desperate and sell it.....to Sony. HEY, ONE CAN DREAM RIGHT?!

Matc1231119d ago

So konami only get $13.333 per game. That can't be right even if it was ground zero sold 2 million which would of payed for a chunk of that budget even with a reduced price.

+ Show (3) more repliesLast reply 1119d ago
Old_Boss_1121d ago (Edited 1121d ago )

Correct me if i'm wrong but isn't MGSV Budget was like 80 millions ? so if it sold 3 million 60$x3,000,000=180,000,000 lets take 30 million from that 180$ million because the PS3/360 version are cheaper, that's like 150$ million so it almost sold double,Now lets say it sold 6 million copy , 60$x6,000,000=360$ million dollar that's almost quadruple the money they put in the game.

I suck at math.

Malphite1121d ago

The publisher doesn't nearly get $60 per game though.

Agent_00_Revan1121d ago

Great article with pie chart showing the breakdown (approx)
http://kotaku.com/5479698/w...

RosweeSon1121d ago

And righty so they publish they didn't produce and develop it. We all know who did that... Hideo!!!

AHall881120d ago

Even at $27 per sale that's around $81,000,000.
I don't see how they spent another $81 million on the marketing.
If Fox Engine cost that much then you make it back through licensing it out to studios, don't count on the first real game they use it for to recoup the cost that quickly.

Papafynn1121d ago

You wrongly assume that the entire selling price of a game goes to the developer/publisher. Of the $60 they will get at most $35. Retailers and the platform holders get a sizable chunk of your $60.

shloobmm31121d ago (Edited 1121d ago )

Actually there is very little mark up in Videogames. Gamestop doesn't make any money on new sales that's why they love the used games market. Most of that money actually does go to the publisher and those games are purchased directly from the publisher and then the retailers make there money by selling it to the customer.Marketing has already been paid which is why its included in costs as is what the developers make. The numbers are even better when development is in house like MGSV is. Console company gets a cut vut everything else is going to konami and the devs based on the contract incentives. Yall are assuming it's like a consignment shop which it most definitely is not.

wheresmymonkey1121d ago

Retailers get all of $5-10. of the $60 you pay for a game. Its why the 2nd hand sales and trade ins are pushed so hard. Game shops don't make almost no money off of new games or consoles.

Omega Zues1121d ago

Well don't forget that when a game sells the studio doesnt get the full $60 of profit. For example:

http://unrealitymag.bcmedia...

Now thats not the most legit graph out there but it more or less shows depending on the situation, publishers, ect that for some studios, they only make around 50-60% of the full retail price.

Even still, lets say Konami only made 50% of profit for every title sold, They still made around 100 million.

Far as the what this article is saying is completely BS, ive never heard of a game needing to sell +6 million copies to break even. The gaming budget would need to be like +$200 million to see figures that high.

Rookie_Monster1121d ago (Edited 1121d ago )

That is not how it works. There is something called wholesale price and manufacturing suggested retail price. When stores like Amazon order new game from Konami for instance, they buy on wholesale of course.

The wholesale price is typically about half of the manufacturer's suggested retail price, so if the full retail price is $60, the wholesale price is $30 and the developer gets around 10-20% of that, or $3 -$6 per unit sold and the publisher that paid $80 million to finance the game gets the remaining amount from $30. That also didn't factor in license free to console makers, typically around $5 per copy sold. Don't really know how digital distribution are broken down though. That is why companies always state shipped numbers on their financial reports as shipped is sold for them.

So having said that, Konami is basically getting like $20 per retail game sold and not $60.

shloobmm31121d ago

Electronic wholesale is not like other wholesale. Been in this business a long time. I own a purchasing company. On typical wholesale the product is marked up 100% that is not the case with electronics and software.

1121d ago
LightofDarkness1121d ago (Edited 1121d ago )

Publisher makes about $27 of the retail $60. Apparently the development budget was $80 million, which does not include marketing (which can be $60 million + for AAA games). I initially figured they'd made about $1 million profit by selling 3 million copies, which is pretty bad for a 7 year development. If this article is correct then it's much worse than that.

They've shipped 3 million, there are approximately 630000 people who own it on Steam and one could assume smaller digital numbers between Xbox and PS4 (probably closer to half of the PC digital sales combined, console digital markets are still quite small). Digital sales are about double the share (or more) for the publisher, so they're conceivably 75%-80% of the way there already. Coming up to Christmas I see them breaking even, at the very least.

But that's still not enough. For it to be a success, it would likely have to sell through 10 million copies at full price, netting Konami a healthy return on investment. It could happen, but I'm not terribly optimistic. Again, these numbers make it quite clear why Konami are no longer interested in such protracted and expensive developments. They have recently said they're still making high-end console games, just not something that takes 7 years and $80 million. Very understandable. Their only real problem was with KojiPro's approach to development. They probably see how western developers are churning out big-budget sequels every 1-2 years, costing less than that and returning their investments in shorter timespans. I imagine this is how Konami will choose to operate in due course.

EDIT: the swinger on this could be a big digital sale leading up to Christmas or just before New Years. If they go for a 50-60%% off during the Steam holiday sale and follow suit on Xbox and PS4, they could sell through huge numbers quickly and make a tasty profit. This effect has been noted before , particularly last year with Alien Isolation.

KurtRussell1120d ago

Profit from 6-700000 copies sold on Steam is equal to 1.5m on consoles. And it will sell for years because of sales. So that makes Steam the most profitable platform for Konami in this case.

yellowgerbil1121d ago

there was once a pie graph breaking down where that 60$ go, you'd be surprised by how little actually go to the dev and publisher. Something like 30% goes to licencing fees to Sony/Microsoft and then like 20 or 30% goes to the retailers. Then like 20% goes to taxes. So at the end of the day they get maybe MAYBE 20$ for each copy. You then got to take in the cost of getting the discs made and shipped. So maybe 16$ will go towards the cost of MAKING the game.
With all that it takes a LOT of games sold to cover the 120 million or so that it cost Konami to make the game (80mil is only production they easily spent anohter 40million on commercials E3 etc)

TLG19911121d ago

You think they get full retail price??? well what does the shop make who sell it to you. and what do the suppliers make who sell it to the shops?

NewMonday1121d ago

publishers take $36 out of every $60 so Konami cashed in $105 at least from week1 sales double that should be over $200 million and way over profit, Luther didn't crunch his numbers properly.

UkrainianWarrior1120d ago

Stop spouting nonsense please. Thanks.

NewMonday1120d ago

@NewMonday

$36 according to Patcher, this is real market data, basically retail get %20 platform holders get %20 and publisher gets %60

+ Show (5) more repliesLast reply 1120d ago
_-EDMIX-_1121d ago

Basically sums up just why Konami is leaving console gaming. Love MGS, but the series isn't a huge seller, its very clear its budget didn't fit its actual sales and I'm not sure they are going to.

Consider that is 3 million MORE at full price...

I see them selling 3 million more, hell I see this MGS hitting 10 million.....not at full price. Fallout 4, Star Wars, AC, COD etc, this year is just jam packed and I don't see MGS going against other titles at full price, it will get sales, just not at the full 60.

HeavenlySnipes1121d ago

It'll probably reach 6 million by the end of the year lol

_-EDMIX-_1121d ago

If not more, I see it going on to sell slightly more then that though ,with the holiday season coming up, at a discount price it will be a big title for sure.

GamingSinceThe80s1121d ago

Let's not forget Ground Zero's was part of the same project so those sales should be included.Plus the collecters boxes were $100 And all the digital sales make them more profit and the online modes DLC.Their going to make money on MGS 5.

TLG19911121d ago

And wait till online kicks of and they start sapping the dedicated fans money with DLC and micro transactions.

traumadisaster1121d ago

Gamer's backlog causes less future sales at full price. Thus supply is outstripping demand and the vicious begins...you can wait to buy months later at $20, backlog increases, purchase then happens 1 year later for $10.

I've been in this cycle for years but I don't multiplayer, which is the only thing keeping the system going.

I also wonder if game devs do what a lot of workers do, piss off for a portion of the paid work day??? You see as long as the game is in development they have a stable income, once it starts to wrap up they may lose their job. Almost incentivized to keep development going.

The industry probably needs half the devs currently out there and probably needs much better management of resources.

_-EDMIX-_1121d ago

Agreed. As much as gamers hate the AC series and COD series, both those publisher always have a title in development, thus many of those staff are always working.

(I could have used a better example lol, tired is all.)

Show all comments (70)
The story is too old to be commented.