Analysts baffled by GTA-hardware disconnect

Industry watchers scratch heads about Rockstar hit's inability to spark Xbox 360 and PS3 system sales.

When Grand Theft Auto IV was released in late April, analysts expected the highly anticipated Xbox 360 and PlayStation 3 game to inspire gamers on the sidelines of the current-generation console wars to jump into the fray and pick up a system. Even though hardware sales from April and May didn't reflect the expected influx of new PS3 and 360 owners, the industry-tracking NPD Group's own analyst is holding out hope for a GTA-driven bump in June's sales "due to gift-giving for Father's Day and graduations."

In notes to investors today, Wedbush Morgan Securities' Michael Pachter said he was again surprised at GTAIV's inability to drive hardware sales. And without new Xbox 360s and PS3s finding their ways into consumers' hands, the game could lose its sales momentum in a hurry.

"Sales were once again led by GTAIV selling 1.3 million units compared with our estimate of 1.7 million units," Pachter said. "This implies a tie ratio of 28 percent, implying potential for tempering demand over the next several months unless the installed base for PS3 and 360 grows faster."

EEDAR analyst Jesse Divnich suggested this week's release of Metal Gear Solid 4: Guns of the Patriots might have an easier time moving hardware than Rockstar's latest.

"This is likely due to the exclusivity factor as exclusive releases on Sony's platforms have historically shown to be a better hardware driver than that of multi-platform releases," Divnich said.

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Discussion

693 comments
RonHack
RonHack

The news about GTA IV not selling so many consoles? Not so baffling, guys. [1] How many people ACTUALLY buy a pricey console to play ONE game? [2] GTA IV for the PC, anyone? GTA started out on the PC, so why not this version? [3] Can you say "global de/recession? Just how much do these analysts get paid, anyways? Seems like the non-analysts out there (see "Democratic Underground" ) saw this coming, but the "analysts" are completely blind. Sheesh!

division_9
division_9

Youre worrying about inflation when youre country ontop of the rest of the western world exploits the poorer countrys to get cheaper coffee beans and more cotton from people who cant cover there expenses with youre ridicuosly cheap bastard corporations. The worst part of this is that youre country go's around saying to the third world "Make more coffee beans to sell" which at first glance sounds great but having more coffee beans means lower price per bean and the corporations wont always buy all of there beans. Also those farmers who are stuck in this kind of situation usually end up having to sell the beans any chance they get because theres so many coffee bean farmers. If they had an alternative to this ridiculously low income theyd take it.

IHatePipe
IHatePipe

Please keep in mind that the driving force behind this fuel hike is the end of the Bush run. He is making his buddies some cashola in the last days of his term. Clinton did it in 2000, Bush Sr. did it in 92' etc...etc. It's just something that happens election year. You have to remember that congress and the White House want us to run and cry to them when things go bad. It justify's their jobs. American's need to MOVE towards independence from the world rather than this BS world economy. We have everything we need, right here, in our own backyards. We just need a leader with the balls to make it happen. Also we American's need to quit acting like scared sheep when crap don't go our way. Ever since the "ME" generation of the 50's and 60's American's have gone soft. When you don't have to WORK for anything you can not place a value on an object you posses. What I mean by this is when your parents/family give you everything your heart desires from day one; how in your mind can you justify how hard it is to earn that product. An example is my XBOX360 which I received for X-mas 07'. My wife bought it for me (which means I really earned 1/2 of the money to purchase it), and it cost well over $400 with the extra controller and games. We are wage earners. I looked at it like this. "OK it takes X amount of hours to make the money to buy this console." Most Americans don't think about their purchases in how many hours of he/she's life it took to buy that object. In all it was about 40 hours of our lives (20 from each of us) to make the money to buy that particular item. I think if our younger generations thought more like this about the things they possess, they might have a better understanding of the actual value of money, and how hard their parents/family have worked to earn them that money. "Be smart, don't vote for either candidate this year...then you too can complain about the bad decision someone else made!" - George Carlin

captaincam2
captaincam2

Also other countries becoming more interested in buying oil in anything but the dollar doesn't matter either with the debt the U.S. is running. Huh? What percent of GDP is it at now? Let's not even talk about the housing market.

captaincam2
captaincam2

Yeah, good luck waiting for a rebound in the economy with the dollar tanking. Also economy going strong?????? It's always good to check if anyone fudged the numbers or the way the numbers are calculated as the government has done recently. LMAO!

Ray101TOT
Ray101TOT

Agreed with Moester10 and darkride66. :)

Moester10
Moester10

I must agree with darkride66. The media's fear mongering has no basis in facts. Any analyst will tell you that we are currently entering a cyclical low which occurs on a five to seven year cycle. The economy isn't going at the same rhythm as it previously was, but nobody expects everything to always go up. The Media is just playing the angles; when things are good they make it seem like the never-ending gravy train; and when things are bad there's no bottom. The fact that the economy is doing as well as it is in spite of high fuel prices, a war and a lack of liquidity in the markets shows that the actual economy is in much better shape than analysts who predicted recession thought.

darkride66
darkride66

stpaul. Wrong wrong and wrong. Look at the ISM numbers. The US economy is steadily improving and has been for months now, despite the the concern about inflation. The fed has eased off on the rate cuts and that's a good sign..it means they're working and they don't have to cut further. Unemployment is still at almost histroic lows (it hit 10% during the recession in the 80's. You're at something like 5.5% now, now even close to the same thing) and yeah, fuel costs are high. Oil is high and you're in the summer driving season, fuel prices always go higher in the summer. Despite the doom and gloom reports the media fixates on, those of us in the financial industry who's job it is to watch the economy have been given nothing but reason for optimism after the recession failed to materialize through the worst of it. Don't believe everything you read. Most media reports would have you believe you're in the grip of one of the worst periods every as opposed to a period of continued, yet slower, economic expansion. I'm sick of having to put out fires for my clients who call up wanting to liquidate their accounts because the media has led them to think it's the end of days.

stpaul
stpaul

i can't see how anyone was expecting expensive videogame consoles to sell like gangbusters in this economic environment, especially in the united states. despite the rose-tinted glasses of folks like darkride66, the economy continues to worsen. the federal reserve board has stopped cutting interest rates due to continued fears of rampant inflation and the minimal impact such rate cuts have had on the economy. fuel costs are out of control, which effects everything, transportation, the cost of food, your electric bill and the price of heating your home. and unlike the go-go nineties, consumers aren't able to borrow against home equity due to mountains of bad debt in the financial system and the attendant free-fall of real estate values. you also have to consider rising unemployment, the flooding of this year's corn crops coupled with ethanol mandates and the global rice shortage. at the very least americans are going to have to make some lifestyle adjustments, and i suspect the video game industry is in just as much trouble as anyone else because of this.

awheaten
awheaten

@marco0798 MGS4 is not coming to the 360... Sorry. 360 dosn't hold enough space on its disk. Well unless they plan on making 12 disk CD collection... I don't think so...

TheoleDominion1
TheoleDominion1

Recession or no recession the "cost of living" and the economy sucks. If gas prices get any higher we're all gonna be on bicycles pretty soon and growing food in our own backyards (I knew I should've planted some tomatoes this year) ...lol

darkride66
darkride66

evanparker2134 said "Perhaps we can't say "recession" just yet. But how can anyone ignore the goings-on in today's economy? We are in trouble, and there will be a recession, without a doubt. " Incorrect sir. The potential for recession has passed. The predicted recession was supposed to occur within the first two quarters of this year with a recovery to start the second half of 2008 but this never materialized. The US economy showed surprising strength during the first two quarters and now there is every indication (have a look at the lastest ISM numbers) that the worst has passed and the recovery has started on schedule. Inflation will need to be watched but your federal reserve has ceased cutting rates for now, which they would still be doing if a recession was still threatened (and they still had plenty of room to cut if they needed to). No one is predicting a recession in the US at this point. If you do a search for "US recession" you will find article after article for the last year and a half screaming about the horrible recession to come, just like the Y2K scare. And like Y2K it didn't happen. I don't understand why so many buy into the doom and gloom. The US economy showed tremendous resiliency by avoiding a recession during what's still a terrible housing crisis, the sub-prime mortgage mess and the subsequent credit crunch. Haven't you noticed that all talk of the US recession has now been removed from the media's lexicon? Now they're all focused on the terrible inflation/gas prices - the next crisis which will probably subside once the summer driving season ends, with no mention of recession. You should all be proud that your economy still managed a period of expansion through the worst of this.

The_Fat_Zebra
The_Fat_Zebra

Life is too costly to include a PS3 and a 70 Euro game...: Maybe if I stop paying the rent for one month; or don't eat for one month, I might pick it up :p I'd really like to play GTA IV, but that'll happen when 1) a port to PC comes out 2) the PS4 hits the market with commensurate decreases in PS3's & GTA IV sold as platinum :)

evanparker2134
evanparker2134

Perhaps we can't say "recession" just yet. But how can anyone ignore the goings-on in today's economy? We are in trouble, and there will be a recession, without a doubt. Some say we already are in one.

crimped
crimped

CHRION987 you aren't alone. the systems are just too expensive. 360 and PS3. thats one reason that the Wii sold so well. it had games everyone can play and was at a better price point. if they(MS and SONY) want to move systems what we need is a good old fashioned price war.

_guenter_26
_guenter_26

[This message was deleted at the request of the original poster]

CHRION987
CHRION987

i wonder how many people are in a similar situation I am? My rent, car insurance, T1 line, and satellite bill every month... a half O, and newports, on a weekly basis, and im left with no moolah:( thats the main reason i just play wow...i cant afford a 360 and i want one badly...being in your mid 20's is F'in hard as hell...

darkride66
darkride66

thenephariouson said "When GS gave this a '10' they just flushed their scoring integrity down the toilet." OR...it could means that they think it's deserving of a 10, like most of the other game reviewers on the fact of the globe. Just because you don't like it doesn't mean it's not the finest example of it's genre. It just means you personally don't like it.

lorenzojkt
lorenzojkt

woi gamespot!, Can you tell me when GTA IV Came to ps2 pless reply

thenephariouson
thenephariouson

Whwn GS gave this a '10' they just flushed their scoring integrity down the toilet.

khariss
khariss

the thing is after San Andreas everyone was like that game is the best ever so people went and bought it with gta 4 most people i spoke to thought it was a let down and i have to agree (still a good game though) but that's why people are not buying consoles for it

darkride66
darkride66

bochap76 said "Class, can we say recession?" We sure can, and we can even define it. Two consecutive periods of negative GDP growth. The US has so far had....drumroll please....None. Not one. Not a single negative growth period and things are actually improving from an economic standpoint (not to be confused with growing inflation). There is no recession.

bochap76
bochap76

Class, can we say recession?

keyser27
keyser27

GTA4 just flat out isn't great. It's good, but the reviews giving it 10 after 10 after 10 did it a real disservice, as playing the game in your hands is not a great experience. A note to analysts: People buy a system for the exclusives. The new Metal Gear game is going to move PS3's, just as Halo 3 and GoW moved 360's. If the Wii hadn't been selling like hotcakes, SMG would've ensured it went huge. FF13 will do the same. GTA4 is not exclusive and not great, the HYPE ensured a massive launch, but you have to have a great game to cause systems to move systems. Playing this game is sluggish and and the cellphone becomes a nuisance less than a third of the way through. I wish the reviewers actually played this game. We would be seeing 8s and 9s for it and it may have done better via word of mouth, as it is, 10's across the board and ok word of mouth with cause it to sink.

darkride66
darkride66

_guenter_26 said "Analysts job isnt that big they just make predictions of sales and such." Again, your ignorance seems to know no bounds. Without analysts the entire world's financial system would cease to be. Stock exchanges wouldn't exist without someone to analyse and assess risk vs return, no one would buy company's debt instruments, no one would know what to invest in, what markets to pursue, where to put any money. Do you think you can survey an entire industry and make accurate predicitons to guide investors accurately without analysts insight? If you could, you'd be an analyst! My misguided friend, analysts are the very backbone of the entire world's economic system. Well, maybe not the backbone, but the liver and kidneys, filtering out all the crap so we can function.

canaries1
canaries1

The main reason though is people don't want to shell out a lot of money on one game. Most prople know they can just play it round a friends house.

_guenter_26
_guenter_26

[This message was deleted at the request of a moderator or administrator]

snakes3425
snakes3425

Did they ever consider that by now everyone who wanted a 360 has one

RunningMansKid
RunningMansKid

[This message was deleted at the request of a moderator or administrator]

darkride66
darkride66

MJ-X said "darkside66 stop commenting on other ppl's opinions and give ur own freakin one. as u can c u got downgraded all the way till this point its all hidden already." Of course it did. If your interested, I've got a theory on that over at my blog called "Majority Rules". You should check it out. The ability for 12 year olds to censor anything opposing viewpoints that offend their poor brains ruins any legitimate chance at debate on these news forums for the most part. It's sad because some of us would actually like to talk about gamer issues, but the Microsoft legions of 12 year olds won't even discuss the issues. Besides, I work in the financial industry, I rely on the advice of analysts every single day because I can't research every single stock out there. Analysts make the entire financial industry work and it sickens me to see kids crap all over their opinions every time they're off. They have no respect for the hard work and dedication these people have.

MJ-X
MJ-X

darkside66 stop commenting on other ppl's opinions and give ur own freakin one. as u can c u got downgraded all the way till this point its all hidden already, u can continue as u want since its ur right to do so but then again there is no point of doing that cuz its just lame. get a life.....

darkride66
darkride66

gatsbythepig said "When is GS going to stop listening to Pachter?" If you have a look at his track record, he's right far more often than he's wrong. That's an important thing for an analyst to be. If you can find a more accurate industry analyst overall, by all means post their predictions as a contrast to what we see on Gamespot. Or, just for the hell of it, post your own predictions and we'll see how they turn out.

gatsbythepig
gatsbythepig

When is GS going to stop listening to Pachter. This guy doesn't know what he is talking about. The real disconnect is his understanding of the gaming market.

2-Man
2-Man

Well, the biggest loser is Sony. When GTA4 was released the only PS3 consoles available were the 40gb model. What on earth was Sony thinking, not having any of their higher end models available at the launch of such a heavily anticipated game?!

AlphonseElric23
AlphonseElric23

@DryvBy4Ever Where have you been? The economy has been sh*tty for a really long time now. It has nothing to do with the economy. It's just that these "Industry watchers" are just idiots who don't know what they're talking about.

dysonlu
dysonlu

@marco0798: Are you SURE MGS4 is coming to the Xbox360? Or was your belief based on a rumor from 2006?

dysonlu
dysonlu

@marco0798: Are you SURE MGS4 is coming to the Xbox360? Or was your belief based on a rumor from 2006?

DryvBy4Ever
DryvBy4Ever

Well, it could be that the economy sucks right now. Gas being how much it is, people just don't have time for entertainment.

georgeorjose
georgeorjose

i was thinking about buying this game but after playing it in my friends house a just was not too excited to go out and buy it so most likely ill just use that money for MADDEN 2009

McGregor
McGregor

I definately was waiting for MGS4 over GTA4. Everyone I have talked to will agree with DVS23, the game (GTA4) fell short of its hype.

DVS23
DVS23

i personally thought the game fell short of what it was hyped to be, it's a great game but not spectacular, metal gear 4 would make more people buy a ps3 then GTA4 would

HappyBB
HappyBB

How about the price for a PS3 or an Xbox360 is still too high, and GTA4 is not such a must-have title!?

_guenter_26
_guenter_26

Vash67 If you were to go ask anyone that had GTA4 they would say it is better than the others and it has more content that you can download and it is plenty big. Also the graphics are amazing for a GTA game, all the others looked like they could run on yhe N64, but this truely can only run on a next-gen console. A lot people bought GTA4 but not every one has a PS3 or 360.

imprezawrx500
imprezawrx500

well with the rumors its coming to pc later in the year I see little reson to buy ps3 for one or 2 games when I have many games I haven't had time to finsh

marco0798
marco0798

"This is likely due to the exclusivity factor as exclusive releases on Sony's platforms have historically shown to be a better hardware driver than that of multi-platform releases," Is this guy stupid?? any console exclusive drives sales for that console as long as it has the anticipation,fan base or even marketing. MGS4 was the only reason i even considered a PS3 but once i heard it is getting a 360 release PS3 night aswell not exist anymore.

finaleve
finaleve

Vash67 > Sure its smaller than most GTA's, but the amount of detail in the city really makes up for it. And the gameplay is pretty good...i mean, you can ACTUALLY take a taxi to places...how freakin' convenient is that? It's the fact that GTA didn't help make the decision any better. You can get the same game for both systems. Exclusives are the only thing that make that kind of decision.

yboucher
yboucher

I think it's simple: people don't know if they should buy the 360 or the PS3 still. Having GTA4 on both systems doesn't make that choice any easier, so people are still waiting for something that will really tip the balance. That's MGS4 of course, which should tip it in Sony's favor. Let's see what the numbers say in a month or 2...

MOHSniper15
MOHSniper15

Honestly, I wouldn't be surprised if someone else has already said this, but I'm saying it anyway. First, I've played GTAIV and it is really good. My only problem is the game constantly crashes on my roommate's 360. However, did these analysts even consider who GTAIV is aimed at? The "mature" audience that the ESRB rates the game as being has other concerns over video games. I myself am 20 years old, I just got a PS3, and GTAIV is not on the top of my list of "must-haves" because (and besides my roommate has it) I can't afford it! I can't find a job and I'm lucky I was even able to afford the PS3. The audience aimed at by GTAIV are the same people who have to pay for their own outrageously overpriced gasoline, food, most likely housing, and possibly education. Not to mention that the younger generation that want the game can't get it because of its rating and the growing controversy around video games (especially the GTA series). So, maybe these developers need to take these factors into account when they make this stuff. Don't charge people $300-500 just to buy a console and then ANOTHER $50-60 for a game that most people will beat in less than a week, especially those people that can't get a decent paying summer job.