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Analysts see Project Natal adding billions to Microsoft's revenue

Video-game enthusiasts are looking forward to the release of Microsoft's motion-sensitive video-game control system, code-named "Project Natal," later this year. Maybe investors should be doing the same.

That's the underlying message in an analysis of Project Natal issued this morning by Sarah Friar and Derek Bingham of Goldman Sachs. The analysts make a series of assumptions -- including an $85 retail price for the camera-based system -- and estimate that Natal will boost Microsoft's revenue by $1.7 billion in its 2011 fiscal year (which begins in July 2010) and $2.3 billion in its 2012 fiscal year.

The Goldman Sachs analysts obviously believe consumer demand for the motion-sensitive Project Natal device will be big. In a note to clients, they say they expect Natal to reach a 56 percent "attach rate" less than two years after its launch, meaning that more than half of new and existing Xbox 360 owners will buy Natal for their consoles

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LordMarius3216d ago

The bots will buy anything and receive nothing

LordMarius3216d ago (Edited 3216d ago )

YES!!!!!!!

I been waiting for someone to call me that
just try to smash this droid, bot

-MD-3216d ago

I like how you call yourself a droid lol what a queer.

LordMarius3216d ago

Those are some good estimates

blitz06233216d ago

$85 retail? I don't think that's possible. It would be great though

Agent Smith3216d ago

The wireless adaptor cost more than that......

Megaton3216d ago

Hah, estimates from Goldman Sachs. Now there's a name I see in the news often.

feelintheflow3216d ago

You mean the one investment company that is still making money, and whose stock price is still way up, and they are turning profits, and will make even more when cap and trade becomes a reality since they own a chunk of the exchange that they will be traded on? If there is one company that I would listen to when it comes to financial things, its Goldman Sachs.

commodore643216d ago

Wow... that's a big call!
Could this mean a 10 year xbox 360 life?

If the $85 launch price is true, then this represents a very accessible pricepoint for casuals.

No doubt there will be a massive and ongoing advertising campaign to educate casual consumers (who know nothing of n4g) on Natal.

This looks huge.
Will be interesting to observe, that's for sure.

GreenRingOfLife3216d ago

Thats Microsoft for ya. They are always innovating and at the same time making it a successful business strategy

Megaton3216d ago (Edited 3216d ago )

@1.4 - I usually think of them first as one of the companies that handed out massive bonuses after taking TARP funds. I know they're one of the only entities in the whole mortgage crisis to make it out relatively unscathed (and actually profit off of it), and I know they paid back the TARP funds last year, but it's still funny to me.

On the whole, I think this is a misstep. Not that Microsoft will see large profits, but that they're hedging it on Natal. I think a lot of uninformed entities outside of the gaming world are under the assumption (planted by Microsoft) that the concept of Natal has never been done before in gaming, and that everyone is as naive as them in thinking that this is a revolutionary must-own gadget. I also think that Microsoft is seriously misunderstanding its fanbase with Natal. I know what the fanboys here say about it, but that's just cheerleading a product for their favorite company. I really doubt millions and millions of 360 owners are super excited for the newest motion cam. They're claiming Natal will reach a 56% attach rate in 2 years. Is there even a GAME on 360 that has achieved a 50% attach rate?

Tru_Ray3216d ago

However, as a gamer I couldn't be less interested in Natal, the PS dildo, or any other motion controller for that matter. Kudos to Microsoft for their me too +1 business strategy.

Christopher3216d ago (Edited 3216d ago )

No way in heck do I see a $1.7 billion boost just from Natal in 2011. Sorry, but they're essentially saying they're going to increase their game revenue by 50% just from Natal in 2011 and I think they're crazy to make such a statement this early on and without any proven games or other applications.

FamilyGuy3216d ago

It's possible yet improbable. What gaming peripheral has ever reached that amount of attachment? It'd have to be and almost necessity like the dual shock 3 over a six-axis.

ThanatosDMC3216d ago (Edited 3216d ago )

Well there are a lot of suckers out there and one born every minute. I still regret buying all those wii accessories that are now just collecting dust. The PS Arc (is that confirmed) will be the same crappy waggle stick.

+ Show (9) more repliesLast reply 3216d ago
THE MAX SPEED 213216d ago

All the new Natal games and support it's getting from the big Devs like capcom will bring more fans.

WildArmed3216d ago

I sure hope so.
And hopefully MS will use that to open up more studios/jobs down the line.
Economy just aint any good in USA atm =/

LordMarius3216d ago

yes not so good, we must help MS and buy their Natal endeavors

A Cupcake for Gabe3216d ago

M$'s consoles are made in Mexico. What American economical stimulus are you hoping for?

LordMarius3216d ago (Edited 3216d ago )

What a shocking revelation, I retract my statement

bioshock12213216d ago

That's crazy they actually see Natal extending the life of the xbox 360 until 2015 that would be great if its true. This definitely looks like it will be the longest generation in video games ever.

kaveti66163216d ago

Microsoft can continue to support 360/Natal on the side for casual crowd while releasing another full-fledged Xbox (3) in about 2 years.

No one actually believes that MS won't have another console until 2015. That's nonsense. Even Sony is working on a PS4.

BX813216d ago

I just don't see another console being released till 2012 the earliest. It's funny how some down MS for rushing the console, RROD no blu ray but you have to give it to MS. For all the mishaps they sure know how to make the most of what they have.

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