EPTOn December 08 2010 11:26 goofy wrote:
Your facts are incorrect about SC2. Take a look at page 18. Under "revenue by platform," the increase in revenue for "PC and Other" was only $46 million for Q3 of 2010. I can imagine that the majority of that revenue was from SC2, but this means that SC2 is still a very small % of the revenue stream for Activision / Blizzard compared to the WoW money tree.
Your facts are incorrect about SC2. Take a look at page 18. Under "revenue by platform," the increase in revenue for "PC and Other" was only $46 million for Q3 of 2010. I can imagine that the majority of that revenue was from SC2, but this means that SC2 is still a very small % of the revenue stream for Activision / Blizzard compared to the WoW money tree.
I too saw the section about "revenue by platform", but did not discuss it in my original post. However, I think that my numbers are more plausible than yours for three reasons.
1) If it were true that Blizzard made $46 million in revenue from over 3 million SC2 units sold, then it would mean that the average worldwide SC2 sales price was about $15. In the United States, the sales price is $60 per unit. This means that if Blizzard sold 750k units in the United States alone, then it would have achieved the $46 million. However, Blizzard stated that SC2 sold over 1.5 million copies worldwide in the first 2 day alone (http://us.battle.net/sc2/en/blog/363375). I know that prices are different in different countries, but Europe accounts for a large share of the market and I believe they also have a relatively high price. (For example, Amazon.co.uk quotes the original SC2 sales price at 45 pounds, which is more than $60.)
2) In the financial statement it says, "Blizzard distributes its products and generates revenues worldwide through various means, including: subscription revenues (which consist of fees from individuals playing World of Warcraft, prepaid cards and other value added service revenues such as realm transfers, faction changes, and other character customizations within the World of Warcraft game play); retail sales of physical “boxed” products; electronic download sales of PC products; and licensing of software to third-party or related party companies that distribute World of Warcraft and StarCraft II." The differentiation in the last two phrases between PC products and licensing SC2 leads me to doubt that all SC2 revenues are in the "PC and other" line item on page 17.
3) Given the size of Blizzard, the size of the gaming market, and the substantial investment made in developing the game, if SC2 only generated $46 million in revenue in its first two months, then I think most would consider that a huge disappointment. However, we have not heard "disappointment" from any of the Blizzard execs, but rather enthusiasm in most public statements.
Regardless, it might be true that SC2 only had revenues of $46 million in its first two months of sales, and I could be wrong. I agree with you that WoW is big business for Blizzard and I am not disputing that fact. Please let us know if you have additional information.
