Nevermind video games though (stop thinking SMALL)...even 'blockbuster' MOVIES like Iron Man are NO competition to ELITE video games like GTA 4.
In my opinion, the media made a big deal out of NOTHING this week with regards to Iron Man and its 'smashing' first weekend SALES debut of $100 million. Take Two must be laughing it UP as Grand Theft Auto 4 raked in 3 TIMES that amount of sales in its FIRST DAY.
Ok, Ok, if you still don't like my GTA 4 VIDEO GAME KILLED/WILL CONTINUE KILLING THE MOVIE STAR investing thesis then lets ignore sales...Lets attack the opposite end of the spectrum and talk COSTS. Iron Man cost $150 million to make and an additional $75 million to market. GTA 4? The Biggest + most expensive video game of all time cost a total of $100 million to produce.
Either way you SLICE + DICE it (SALES, COSTS, MARGINS - video games carry SIGNIFICANTLY higher gross margins than most products/services...think about it...once you have the video game software developed all you need to do is copy cd's to increase supply. AFTER the upfront R+D costs, the incremental cost per unit shipped basically becomes the incremental cost of each CD/piece of packaging shipped), GTA 4 is the talk of MY money hungry town..NOT Cornywood and its 2 hour Commodity Man movie.
--------------------------------------------------------------------------
Some GTA 4 1st week Sales Stats:
*GTA 4 sold 6 million units WW in its first week (average Rev per unit = $83.33!)
*The title sold about 3.6 million units on April 29, its opening day, bringing in roughly $310 million.
*GTA's 4 FIRST DAY SALES surpassed Microsoft's (MSFT) HALO 3 FIRST WEEK sales by about $10 million. GTA 4 blew by Halo 3's previous record of first week sales by $200 million !
*According to BusinessWeek, Microsoft said Xbox 360 sales jumped 54 percent in the week following the title's launch, compared with the prior week, and more than 2.3 million people played it on its Xbox Live online service.
*"Retailers say roughly four out of every 10 Xbox 360 consoles sold also included the sale of a copy of 'Grand Theft Auto IV,'" said Aaron Greenberg, director of product management at Xbox 360 and Xbox Live.
*Sony (SNE) spokeswoman Laura Bakken said the company's 10 largest retailers have "all seen a pretty substantial lift" in PS3 sales, but she did not give specifics.
http://www.businessweek.com/ap/financialnews/D90H0BHO0.htm
Data Courtesy: BusinessWeek.
Full Disclosure: I own shares of TTWO.
Posts
