Ubisoft backing off new IP as holiday sales slip

Publisher scaling back development of new properties, declares PS3 Motion Controller support, reconfirms Oct.-Dec. earnings fell 3 percent to $682 million.

In recent years, Ubisoft has launched a bevy of new series with varying degrees of success. Since 2006, the publisher has introduced gamers to Assassin's Creed, Shaun White Snowboarding, EndWar, HAWX, Rayman Raving Rabbids, Call of Juarez, and Haze, among others.

Assassin's Creed paid off for Ubisoft, but the publisher's looking to take fewer risks of that sort in the future.

The flow of original intellectual properties from Ubisoft will be stemmed in the coming years, as the publisher is shifting its focus away from new franchises. In reporting its final results for the third fiscal quarter (three months ended December 31, 2009), Ubisoft confirmed "a reduction in new creations investments."

The scaling back on new franchises is one part of a Ubisoft plan to ultimately have its major franchises seeing more frequent and regular releases. Delays have plagued a number of the publisher's sequels, most recently affecting Splinter Cell: Conviction, Red Steel 2, and the just-named Ghost Recon: Future Soldier.

In a postearnings conference call, Ubisoft CEO Yves Guillemot positioned the move as a reaction to the current economic climate. Given the state of the market, he said it is time for the publisher to take advantage of the new brands it made from 2006 to 2008 and take on fewer risky new projects.

That doesn't mean Ubisoft is ceasing production on new franchises entirely. Guillemot said the company has unspecified projects that have been in development for some time and will be launched in the publisher's next two fiscal years. Though he didn't mention them by name, I Am Alive and R.U.S.E. are the two most significant announced original intellectual properties on Ubisoft's slate.

Ubisoft may be scaling back on new franchises, but it's committing itself to new technologies. Guillemot told analysts that Ubisoft was working on a number of titles for Microsoft's Project Natal and Sony's motion-sensing controller, as well as games for the social networking site Facebook.

As for its financial results, Ubisoft's final numbers matched up with its preannounced earnings from last month. Revenues for the holiday quarter totaled €495 million ($682 million), down nearly 3 percent from the previous year. For the full year ending March 31, 2010, the company expects to post an operating loss of €50 million ($69 million) off sales of €860 million ($1.19 billion).

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