Huge drop in profits compared to this time last year.
http://www.nintendoworldreport.com/news/23795
Capcom have reported a net income of 216 million yen ($2.4 million) for the quarter ending June 30, 2010. Compared with the same period in 2009, this is a 94.8 percent drop. While profits are down, net sales are similar to last year, with just a 2.4 percent drop to 19,037 million yen ($219 million).
The shrinking US and European markets due to the state of the economy and the strong yen are large factors in the profit decrease. Titles such as Super Street Fighter IV and Monster Hunter Frontier Online showed steady sales growth, but Lost Planet 2 sales failed to match projected earnings, leading to overall stagnant sales. The slow sales rate of Monster Hunter Tri for Wii and the struggle of Ghost Trick for DS in the Japanese market has contributed to the figures.
New franchises have high development costs, yet risk worse sales performance compared to established franchises. Recent reports from Capcom have stated the company's intention to release more titles of their more profitable franchises.
The interim results do not affect predicted income for the year ending March 31, 2011, an expected net income of 8,000 million yen ($92 million).
I think the two biggest factors in the near 100% drop in Profit is Lost Planet 2 and Dark Void. Lost Planet was already mentioned, but even Capcom would like to forget Dark Void. That was one of the biggest flops this generation. And it also had an enormous budget that spanned years of development time.
As for HD development being a large factor in lowered earnings... yes and no. NOW HD development is considerably easier than it was in 2005. But the massive investment that graduating to High Definition required in those years has not been monetized enough to make up for it, resulting in all of the pain of being a trailblazer, but none of the benefit.
This goes to show that third party games on wii are not the only ones suffering poor sales.
So time and effort into HQ HD assets with details in everything from the ground and it's grass to the character model and his shoes that are stepping on them cost about the same as a Good Wii game?
I'll be sure to tell that to all the 3rd parties that have been wasting all this time and money chasing the Uncanny Valley when they could have been making Wii games instead. They were the ones spouting off the cost difference of Wii development vs PS360 development afterall.
I really don't want to start a fight again, but the mentality that making an HD game costs significantly more money than making a non HD game is just patently false at this point.
By this logic, why on earth are there so many threads being so excited about how powerful the 3DS is? The hypocrisy is sickening.
Oh, and didn't Nintendo just post a big decline too? Obviously that's also because they are dedicating all their dev dollars to the 'HD Systems'.
See the fact is that people demand the same level of polish in Wii games or they call the developers "lazy". At that point, resolution and horsepower have very little to do with it.
The thing is, the visuals of Lost Planet 2 and Dark Void aren't even that impressive. I don't think them being HD projects is what made them so costly to Capcom, but that they put so much money into them trying to make troubled projects work and then no one bought them. Being HD projects certainly didn't help matters, but I doubt those were the worst costs of the projects. I doubt Capcom lowering their earnings projections for Dark Void shortly before release helped the game's sales, either.
