Next-gen dev costs to hit $60 million - Guillemot

Ubisoft CEO says the cost for creating games for new consoles will double due to technical potential, OnLive could usher in new cycle earlier than expected.

As the technical capabilities of gaming consoles have increased with each subsequent generation, so too has the price to make games for those systems. Current-generation AAA game development is a pricey affair indeed, with Guerrilla Games telling a Dutch newspaper that its top-tier PlayStation 3 shooter Killzone 2 cost upward of $21 million. And according to Ubisoft chairman and CEO Yves Guillemot, that trend will continue with the arrival of the next generation of gaming consoles.

Yves Guillemot

Speaking to CNBC, Guillemot said that he believes creating upper echelon games will cost on average $60 million, due to the increased investment in technology necessitated by the technical potential of the new consoles. "The next generation is going to be so powerful that playing a game is going to be the equivalent of playing a CGI movie today," he said. Headcount is likely to be another factor spiking costs, with Ubisoft saying in May that more than 450 people are working on Assassin's Creed 2.

A number of analysts, including Wedbush Morgan Securities' Michael Pachter, believe that the next round of new consoles will arrive in 2013 at the earliest. However, Guillemot believes one factor that could advance that window is OnLive's on-demand game-streaming service.

"If somebody comes out with online--if OnLive manages to make this work--we will have a next generation of systems sooner than currently planned," he said. Ubisoft, along with Electronic Arts, Take-Two, Warner Bros. Interactive Studios, THQ, and several others, announced that they would support the service with new games when it launches later this year.

Having debuted the publisher's own Wii-based movement sensor during Ubisoft's E3 2009 press conference, Guillemot also expressed optimism over Microsoft's and Sony's new wave of camera-based motion sensing.

"[Microsoft's Project Natal] is one step, but quickly they will take the other step [of releasing new consoles]--pushed by the environment," he said. "For us, the current machines are very powerful, and we can do high-quality work. I'd like to stay with this generation as long as possible, but my customers will want the best machine possible." Guillemot went on to tell CNBC that he expects the new motion-sensing technology to expand the core gaming audience by 20 percent.

Lastly, Ubisoft's foremost executive addressed the publisher's ambitions in the massively multiplayer online gaming space. According to Guillemot, Ubisoft was outbid by Atari for Star Trek Online developer Cryptic Studios last year, but the publisher is still interested in establishing a foothold in the space.

"We know it can be a disaster or a very profitable business," he said. "It's a part of the business we want to be in...but we have to find the best place to invest." Notably, as part of Ubisoft's acquisition of the Tom Clancy brand in March 2008, Guillemot said that the publisher was interested in adapting the military franchise to a massively multiplayer online environment.

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