Analyst cautious on EA, predicts next Xbox, Wii

Pacific Crest's Wilson believes Spore publisher is primed to reclaim market share by 2011; Microsoft's new box to debut in 2010, preceded by Nintendo's Wii follow-up.

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EA CEO John Riccitiello was the first to admit at last week's D.I.C.E. Summit that his company had made a number of costly mistakes that have opened the door for market-share challengers such as Activision in recent years. However, yesterday EA laid out a wide-ranging counterattack to fend off would-be third-party publisher kingpins. Specifically, the company officially confirmed the next installments in the Burnout and Skate franchises, and also dated Will Wright's long-awaited "sim everything" Spore. EA further said that it expects to increase revenues by an astounding 71 percent to $6 billion for its fiscal year 2011, which ends March 31, 2011.

However, while promising massive revenue gains is one thing, actually delivering is something else altogether. Although the jury will be out for another three years, Pacific Crest Securities analyst Evan Wilson believes EA's rosy projections are entirely feasible, though not exactly assured.

"EA has given us the best case yet that it has overcome its addiction to spiking development costs, game delays, poor game quality, and lackluster innovation," said Wilson.

Perhaps taking cues from Alcoholics Anonymous, Wilson laid out what he called "The 12-Step Program for a Broken Publisher," the first eight of which EA has successfully completed:

1. Recognize the problem: EA sees declining quality, market share, competitive position.
2. Seek help. Initiates a search for new management.
3. Decide to trust help: Hires John Riccitiello, Peter Moore, Kathy Vrabeck.
4. Take a close look at yourself: Go through detailed fiscal year 2009 and fiscal year 2011 plan.
5. Share your findings with another: Set out strong goals to board.
6. Practice trusting your help: Delay Spore, Warhammer, Battlefield, Mercenaries, and Rock Band in Europe.
7. Ask for help in specific ways: Admit issues and allow new hires to address flaws in quality, technology, and platform choices.
8. Think about those harmed. Host a very bullish analyst day for frustrated investors. Prep a solid fiscal year 2009 release slate for customers.

That leaves just four more steps to complete:

9. Make things right to those harmed: Release high-quality games for gamers and rein in costs in fiscal year 2009 for investors.
10. Regular check-ups: Host another bullish analyst day in February 2009.
11. Grow trust in help: Hit very optimistic market-share and margin targets
12. Live the program: Return EA to its glory in fiscal year 2011.

Concluding, Wilson noted, "While we have issues with the likelihood that EA will hit its fiscal year 2011 targets, it has a very strong slate in fiscal year 2009 and has every opportunity to gain back market share.

Wilson, who late last year made projections about a Nintendo DS redesign already being complete, also gave investors today a heads-up on when he believes Microsoft and Nintendo will unveil their next systems. "We believe that peak industry sales will occur in 2010, given that Microsoft will likely introduce its next console that year and Nintendo will likely launch before then. Further, 2010 is also likely to coincide with the end of the Nintendo DS and Sony PSP cycles."

Discussion

101 comments
liam82517
liam82517

having one console is THE most retarded idea I have ever heard. If MS or SONY or the big N dont have someone else driving them to make their product better then the only thing you will be playing on is a bust ass game system that they will drag their heels to fix. Take the 360 for example imaigine that the 360 is the only console avaliable. 1. Console will not be sold at a lose you will pay full price plus profit(read at least 100% over cost to manufacture) 2. With no competition new ideas would be left behind in place of tried and true methods. no wireless controllers no head sets no LIVE service. 3. RROD would not be fixed, why would they bother its not like your going to go buy a different console if they dont, there isnt one. 4. no updates to software games might still show inovation but on a system that doenst try they wouldnt be that reliable. having 2 or more companies is a good thing its the fanboys, the creepy little kids and weirdos that no one likes that spoil gaming. I prefer my 360 I prefer it because if 2 things and they are personal things to me. 360 controller and LIVE service that it plain and simple I like how the PS3 looks on the outside not so much the user interface, and i really hate the controller but i know that there are people that think the opposite of me, thats fine each to there own, and as long as we all have a choice to find somethign that suits each one of us and not just be forced to ONE console the gaming industry will continue to grow and change and yet somehow stay the same, if only there was a way to get rid of the fanboys that want to argue over nothing. I dont mind a debate as im sure lots of you do but i dont have to call someone a douche bag to make my point. Peace....

Agermemnon
Agermemnon

@shadynate82 if all three were to make one system who would try and jump in and mess with it ? also try asking the devcos who would be making games for the one console to make games for it ?

shadynate82
shadynate82

it would be nice to see the consoles come together and attend to all needs. Iif that was to happen though then a new console will try and knock. it happens to everyone who trys to buy up competition

Agermemnon
Agermemnon

I would be all for a single console format to sit alongside the pc the current three formats is just stupid IMO , One format would be great and imagine all the devcos just working on it and the pc ? would be a win win situation for the consumer .

Gaza-for-wii
Gaza-for-wii

I don't think there should be a nextbox, a ps4 or wii 2.I think these companies should bring their ideas to eachother and bringout one kickass, superawesome console.That way we'll have no console wars, ppl saying sony ripped on Nintendo and MS, complaining that one console has better graphics, etc. I thinks its what should happen.It could be interesting and start a whole new gen of gaming!But a name for it!HMMMMMMM??????

nate1222
nate1222

@BigSmitts07 I totally feel you on that. I love gaming. I feel that gaming is a superior entertainment medium. But at some point 'big-expensive-tech' needs to make room for, dare I say it, PRACTICALITY. You know, "BC", "afforability"... Nintendo seems to be bearing this in mind. They want the Wii to be a console that can be available and affordable in countries that normally don't have a console market. Look at Southeast Asia: they pretty much play OLD ASS PC games on low-end rigs, because consoles cost too damn much over there. $ony and Micro$oft aren't even considering such factors. Nintendo is going to win this console generation, because they're working on ways to make gaming GLOBAL. Rich/poor, educated/illiterate, developed nation/s*** hole, you can afford and play a Wii.

Nikodemus87
Nikodemus87

i wonder how long my 360 will last until MS kills it? 2012 maybe? atleast...that´s what i hope. that and 4:3 support to reamarge instead of the stupid widescreen support.

Proust
Proust

If MS and Nintendo dare to put out a console in 2010 ... Make'em cheap and make'em often is not an attitude that should be held with consoles.

Dav_id83
Dav_id83

What should one thing to consider is the fact that most EA games for todays consoles have been little on the impressive side. NFS Pro Street on 360 looks poor even in HD there have been bugs in games like NFS Carbon. There online servers totally suck and they don't do anything about it I am finally glad to see competition such the likes of Activision I was hoping to see BioWare and Pandemic do the same. To me there purchase by EA is false I believe EA saw them as a threat Mass Effect sold well and a trilogy is in store. Mercenaries 1 sold well I and really enjoyed it with Mercs 2 it's going to sell well and so a franchise could of been seen more loss to EA's marketshare. Only 1 thing left to do buy them out take them out the game add them to your every big bullying company and gain the marketshare back.

rockstar_88
rockstar_88

Man I remember when Sega released the Dreamcast. The Sega Saturn lifespan was too short and EA cut Sega off their list to develop games for afterwards.

AceCometh
AceCometh

It's sad that they're talking about new systems already. This current generation of consoles is just getting started and will be around for quite a while.

GeigerdolylWodd
GeigerdolylWodd

I don't know maybe they're being a bit to harsh this generation isn't exactly like the last generation. Its more expandable and xbox 360 has had flash drive updates to the hardware and the swappable harddrives. 7 years or so not just 5 or 6. The BCing is what I'm mostly concerned about not all games have been BC'd yet.

GeigerdolylWodd
GeigerdolylWodd

'"Wilson, who late last year made projections about a Nintendo DS redesign already being complete, also gave investors today a heads-up on when he believes Microsoft and Nintendo will unveil their next systems. "We believe that peak industry sales will occur in 2010, given that Microsoft will likely introduce its next console that year and Nintendo will likely launch before then. Further, 2010 is also likely to coincide with the end of the Nintendo DS and Sony PSP cycles."'

Wait what? 2010 the next XBOX? What's he been smoking? The 360 just came out 2 years ago sans 2006. 5 years tops 2011 maybe 2012 maybe.

I don't think they should make any more I think they shoud finish optimizing what they've got. If they do make another console it should have swappable parts aside from controllers. wait the 360 and PS3 have swappable parts aside from controllers right?

razu_gamer
razu_gamer

sorry EA but do hate it when you are always wrong??

BigSmitts07
BigSmitts07

well...2010 will be 5 years...seems short to me but its longer then the oringial xbox....at least i know that ill still have at least 2 more good years with my 360...i hate trying to keep up with systems, i wish companes would just invest in DLC games adn updates more so systems cycles couldl ast more then 5 years.....im tired of trying to keep up with the joneses....if the new MS system is 350-400...i guess ill be gaming with my 360 for alot while longer..

PS360owner
PS360owner

LOL. By the time Sony catches up to this generation, Microsoft's going to be on to the next. This just really shows how backwards, arrogant, and uncompetitive Sony has become. In a couple of years the BS3's going to become hopelessly obsolete.

svaubel
svaubel

New consoles in 2010? Too soon

Lord_Artix
Lord_Artix

Besides Iwata-san already stated that there wouldn't be another full-on nintendo home console while he was still in office. I don't think that there will be any new consoles until at least 2012 or 2013. If this is true, that would put the Wii beyond the normal console lifespan, which as much as I'd like to see it happen, imo the Wii doesn't have that much staying power. I'd say Q2/Q3 2011 will see the next Nintendo system.

nate1222
nate1222

As a long time gamer (NES thru present), my chief concern is BC. Not just the software, but the controllers, mem cards and harddrives. I do NOT like the prospect of dolling out money on games and periferrals that I can't use on future hardware. And I KNOW I'm not alone. Whichever console maker addresses these issues (probably Nintendo) gets my money. My current relationship with Micro$oft is tenuous as it is.

wingnut99
wingnut99

Well I did hear something about sega's new system. But I thing what they were talking about a new system for VR5. I tryed to find some thing online about it. Never did find anything but DreamCast.

Captainintendo
Captainintendo

"2010 huh? By that time SEGA will already have another console availible." ? Is this comment supposed to be sarcastic? Sega is out of the console business.

y2guru
y2guru

I am sure they meant they would get their hands on the tech specs and dev kits from Nintendo and Microsoft in 2010, the consumers would see/hear about the next platforms a year or so afterward. Typical consumer hardware cycle is about 6 years.

Dr_Corndog
Dr_Corndog

A Wii follow-up in 2010? I hope not. Although the blow would be softened considerably if Nintendo makes it fully compatible with the Wii's controllers.

wingnut99
wingnut99

@wsradon. Think about it. New video cards that are coming out have 1-2 gigs. Now in a few years video cards could have 4. So why is that hard to take in? When I find the link about it I will put it up. i had it in my favs but had to reinstall windows. I'll look for it.

shoeman12
shoeman12

all of those are quite possible

LindBergh2007
LindBergh2007

2010 huh? By that time SEGA will already have another console availible.

dru26
dru26

I think nintendo will be the first out of the gate next go round, with MS a very close second. Let's face it us Wii owners like our console, but it's impossible to argue that the technology is very dated, and looking worse and worse as the days roll by.

wsradon
wsradon

Where do you get 6 gigs of ram from? it will probably have a good 2 gigs of ram and a gig of video ram, but 6 gigs gimme a break.

kejigoto
kejigoto

Personally I see Nintendo launching another console but keeping the Wii alive and on the market. It already has a great user base and plenty of people out there love it. I mean its been well over a year since this thing hit store shelves and in many places people are still struggling to get their hands on one. Why would Nintendo just up and end the Wii with this large of a user base? Even Sony is smart enough to keep the PS2 around considering the numbers it has, why kill something that is still doing well? I think Nintendo could easily support two consoles on the market at once, one being the Wii for the casual gamer audience while the other being a graphical powerhouse for the more hard core gamer. I know its abit of a stretch but at the same time this move wouldn't surprise me either. This would allow Nintendo to have the best of both worlds, and would also appeal to even more people. However I don't see Nintendo doing anything like this for awhile with the Wii still doing well and the quality of games really starting to pick up. If the Wii holds up through this year and continues to dominate the market like it has then Nintendo has no reason at all to move onto the next big thing. 2010 sound reasonable for the end of the DS and PSP lift cycles and personally I can't wait to see what Nintendo will do for the next handheld. Hopefully Sony will bring abit more to the table and learn from their many mistakes with the PSP (that's if Sony decides to stay in the handheld market at all). It will be interesting and I wonder if anyone else will try to break into the handheld market on this next cycle, can anyone top Nintendo? As for Microsoft I'm not sure, they are doing well and have a great user base. I don't see them moving onto another that quickly when they are doing so well and managing to keep on top of Sony. This year will definitely show a direct comparison between Sony and Microsoft, and I'm guessing Microsoft is going to continue to stay ahead of Sony and that more developers will be moving over to the either a 360 exclusive or a multiplatform launch (Devil May Cry 4 and GTA IV). Just have to wait this year out and see what happens, if Microsoft and Nintendo continue the way they have been going, I wouldn't expect any change from them anytime soon. In fact I'd be more adapt to look at Sony for some huge changes to try and get back in the game.

carljohnson3456
carljohnson3456

"Autolycus ps3 will not come out 2nd... they will do whatever they can to come out first. from someone with more credibility then this shmuck" Oh, like they'll rush a console to market... rush the hardware... make it faulty? Is that right?In all honesty, that was a cheap shot at the Xbox just because I know how much you really hate Sony. So basically, anything you say about Sony is not credible, because you're so biased, so that "shmuck" has more credibility than you. Sony will probably come out 2nd because their hardware is built to last longer. BluRay, WiFi, Bluetooth, exchangable HDD, while the 360 has none of those. I dont beleive in the "10 year cycle" but I dont think they'll be rushing a new console anytime soon. Considering MS cut the original Xbox off at 4 years, I bet they come out asap, make sure to beat the PS4 to market. Obviously they will be the ones to do that before Sony, considering they did that this gen. But like it's been said, this is all fun speculation, right?

wingnut99
wingnut99

The new x box, from what i have seen will have 6 gig of video ram. Sony will have 4. That could change. once MS come out with the specs. Sony wants power so they wont be out done like the PS3.My god. What will games look like with 6 gigs of video ram?? Gears 3 any one?

funky_muzic
funky_muzic

One of my favorite parts about video game discussions is the speculation. Remember the crazy diagrams of the possible new Nintendo "Revolution" controllers before they were unveiled? I actually believe that the Wii will have the longest lifespan in the market. That's because many Wii owners don't care as much about high-end graphics and such like many PS3 and 360 owners do. Microsoft will definitely not bow out of the console market. Their gaming division recently turned a profit for the first time. Why would they get out now. You may say they messed up with a console that has a high percentage of technical problems...but I personally know several 360 owners that bought a second 360 when the first one gave them the red lights of doom (prior to the warranty being extended, of course). The 360 must be OK, if people will buy it twice. Also, why would MS make an XBox 660 (LOL), shouldn't it be the 720? Maybe some people just don't get it. I would not be shocked if Sony's next console does not have the "Playstation" name attached too it. Granted, they have developed that brand, but is there too much negativity associated with the name now? Also, it will probably be "middle off the road" as far as technology goes. They now know just how important the price point is. Of course, by then, Blu-Ray will be middle of the road technology. Sony will also try to cater to some of the non-gamer market that Nintendo has helped to create. Nintendo will continue to have a low-priced, "low-tech" console that does not alienate their "non-gamer core. " I am confident that Nintendo will unveil some new innovations in motion-sensing technology with their new system. I'm quite excited too find out what the new Wii will bring to the table.

djayshaggy
djayshaggy

How can they say that the Wii, which is expected to sell out until the beginning of 2009, will have its follow-up by 2010. That's just stupid. That would give it a four-year life span. The GameCube had more than that, and it has ALOT less staying power than the Wii. Besides Iwata-san already stated that there wouldn't be another full-on nintendo home console while he was still in office. I don't think that there will be any new consoles until at least 2012 or 2013. This war is still fresh and young. These consoles aren't moving into their maturity as quick as they did before, and people don't want a new one as quick as before.

Autolycus
Autolycus

ps3 will not come out 2nd... they will do whatever they can to come out first. from someone with more credibility then this shmuck

Phazevariance
Phazevariance

You have to remember that most companies (or good ones at least) tend to learn from mistakes they have made in the past. MS learned not to release too late, and thus 360 came out early. Good move? yes in terms of sales. Hardware wise, they had some problems, and that was mostly due to cost cutting so the price wasn't $1000, and you know what happens when parts are made for too cheap a price, it fails. This doesn't mean they will make the same mistake next time. I'm quite confident that the PS4 will blow the next xbox out of the water, but that's because it will probably come out to retail 2-3 years after the next xbox does. Perhaps by staggering release dates by a few years, all comapnies will get the opportunity to make a good profit on their consoles. Microsoft will never bow out of the race, seeing as they always have their hands in the pile with their PC software in terms of the gaming aspects. The next console will most likely have a bluray internal, if that becomes the definate industry standard. They've already said so in the past, if BD won, their console may get an adon, or the next one may have it internally. I would buy a PS4 if they just made the controller more like the 360's since to me the 360 controller is near perfection. As for the Wii, yes as hardware prices drop, expect that the next one will be much better in terms of graphics, and will have to have HD support. But it won't cost an arm and a leg, cause the hardware will have already come down in price for those features, at which time the next xbox and PS consoles will most likely include support for the next 2 resolutions of HD which are being worked on as we speak. I suppose the next problem to tackle will be how to make games that dont take 10 years to complete, and still keep up the insane quality and innovations.

wingnut99
wingnut99

Hvac0120@. I read that even when the new xbox comes out you can still take what you have one the 360 and put it on the next gen box. They will keep XBl the way it is. Just update it over time. So it's the same XBL. You can still use your gamer tag on the next gen box as well. i think they will have a cable to send what is on the 360 to the new x box.

Ravi_1900
Ravi_1900

Some recent interview MS representative said abt 8 year life cycle and I think the guess is by EA side, yeah the hardware will get old but developers will get to know a lot of it by that time and Xbox 360 do have more flexiblity than its predecessor, so as long as the developer support is there there would be no problem but yeah if we compare to the PC the games will be less impressive in terms of graphics and so goes for PS3 but with increased install base and sale you can hope for more exclusives.

theKSMM
theKSMM

I suspect that Nintendo will have the shortest console cycle (say, four years) and Sony will have the longest (about six). Microsoft will probably be due for a refresh in 2011, around the same time as Nintendo. Those parts of the prediction make sense. As for the rest of the console partisans, good luck in seeing your favorite company achieve domination of the gaming world within the next two or three years.

Hvac0120
Hvac0120

MS really screwed up with the Xbox360. It's been out for over 2 years and they are still having technical issues with it. I would prefer if they took their time and didn't rush to be out before Sony this next time around. It's likely that Sony is taking their time to develop PS4 and the tech included. Plus, MS has built up a lot of services for Xbox360. A lot which have only been around for a short period. I would hate to see people losing out on content because of DRM and transfer issues to the new box.

hotdork70minus1
hotdork70minus1

The average cycle is every 5 years, MS is only UNVEILING the new Xbox in 2010, not launching it. IBM has been working on new technology for this future xbox for 2 years now, this is no secret.

wingnut99
wingnut99

@mpeg3s. Dude. everything you just typed is wrong. The next xbox Bill Gate had alot to do with this new x box. Ah this new xbox was in the works a few years ago. So far x box executives have been better than any other executives. Gears Of War, Bioshock, NG2. I could keep going. So far the big executives for the PS3 have not been so good. As for faulty hardware. You are crazy if you think the next gen x box will have them. Lets not forget that the PS3 has had some bad drive's in there PS3. No one like to talk about that. My frist 3 PS3's had bad drive's in them. Gear Of War 3 and bioshock 3, also lets not forget that there will be a halo of some kind that will help sell. Also. Jappan only like to support there was people. So jappan game makers like to keep there cash in there home land. Maybe we should do the same. I also would like to point out something when we have a new presiden. The way we deal with comps out side the U.S. will change. Jappan can send there things to sell here almost free. But the U.S. pays out the butt to send things to jappan. So this next gen We will see a bigger tage on made in jappan things. This would also help the next xbox. Why? the next presiden will fix how we deal with out side goods. That way we can keep jobs here, and the comps will have a far chance at selling there goods to places out side the U.S. (So let say if) if the next gen xbox was $400 then the Next gen PS4 could be $800. Now keep in mind that this is just a shot in the dark, but this is how trade works. So we will see a bigger tage on all thing made out side the U.S. This is a good thing for U.S. bad for them. Now we could see no change. What could happen is anything we get from out side the U.S. could be 6 months to a year old teck. Thats why we see things come out frist in jappan with Sony. When we had a far trade deal with jappan the PS1 was out in jappan for almost a year. when the Price to make it came down, it came out here. I know the xbox was made out side the U.S. but it has the MS name so it wont get hit like that. Sorry for the book people. So we will see a bigger tag on both Sony and nentendo's next gen systems.

SavoyPrime
SavoyPrime

A new system from MS and Nintendo in 2010...this is getting damn ridiculous. These hardware manufacturers are raping the consumer with these shorter and shorter console cycles.

mpeg3s
mpeg3s

MS will bow out of the console race by then. The PS3 will over take it because the following: 1. Nintendo will release an X360 clone (more RAM) and internal HD without ANY stoage restrictions and NO Blu-Ray with their Wii Controllers. They may use HD-DVD if it's cheap enough to do so. 2. PS3 will have Blu-Ray and a new momentum and will go SLIM with a cheap price to try to compete with Nintendo surpassing ALL XBOX sells. 3. If MS is stupid not to dropout the hardware race then the next box must have Blu-Ray or HD-DVD and either way the pricing will be more than both the Wii 2 and the PS3. GAME OVER! MS can't compete because of not the hardware, it's their executives, which should be working at MS for FREE. They suck and don't have a Bill Gates vision of the XBOX! Too much faulty hardware Too many storage and DRM restrictions Not enough Japan exclusives GAME OVER!

kratos_karmakar
kratos_karmakar

i have a question to every 1 and would be glad if som1 answered having correct information about it. r we talking about ANOTHER console from ms and nintendo? not like a 360 with an internal hd or bluray player but an entirely new console with new hardware and new name like xbox 660 or something. if thats true then i miss the old days when consoles lasted longer than this. look at the ps2. still going strong. and sony supports it. they r so good not shutting down production to their ps2 to make ps3 sales grow. i love my ps2. to me its the coolest most hip most sexy console in the world. u cant keep it anywhere coz its so small. u can mishandle it roughly and it still runs like the 1st day u bought it. and games on it, okami, mgs, shadow, ico, god of war, dmc, etc. i always go back to those games and still feel the excitement from days passed.i have never gotten that sense of cool from nintendo's consoles. the only game i liked on nintendo was donkey kong country. cool!i know a lot of guys love that.

02sfraser
02sfraser

i agree with the end of the DS and PSP. both consoles have had a healthy life and not many exciting things are coming out. however i think the 360, PS3 and Wii have enough power and innovation to last at least until 2011

NecroCharm
NecroCharm

blackace you are correct, Nintendo's consoles always last min 5 years. No new nintendo until 2011 and MS has said no new xbox until 2011 as well. EA is wrong..as always.

pourya_ahmadian
pourya_ahmadian

are you sure?the MS console is so great(XBOX360);why the great MS must do it?

pourya_ahmadian
pourya_ahmadian

are you sure?the MS console is so great(XBOX360);why the great MS must do it?