Profits for publishers hinge on huge sales numbers

Namco is reporting that they need to sell 500,000 copies of a PS3 game to make a profit. That is outlandishly high and will make niche games impossible for the PS3. Small game developer companies will have no hopes of ever making a profit on the PS3, so they probably won't even try.

Namco has only sold 22,000 of each of their PS3 games, Ridge Racer 7 and Mobile Suit Gundam: Crossfire. That is only 4.4% of what they need to sell to make a profit. Exacerbated by the fact that Sony cannot produce consoles fast enough for demand, game publishers are stuck with games that are losing them millions of dollars. If it takes a year for publishers to recoup their investment on games for the PS3, they may just decide to program for the 360 or Wii.

The only hope for small and independent game publishers on PS3 is the download service. Not many details of this feature of the PS3 has been revealed, but it will probably be like Xbox Live's game download service. It is worrisome, however, that Sony has not divulged any details to other companies about their planned service.

The PS3 game shelf at your local video game retailer will probably be small, with only big name publishers and sure fire hits. I don't see any company taking any chances with a new concept on the PS3, and that is sad not only for the console, but for the industry. http://digitalbattle.com/2006/11/30/namco-big-sales-for-ps3-profit/

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Posted by Brian

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