Activision raises concerns over Xbox 720, PlayStation 4 launches

Bobby Kotick points to the Wii U's slow adoption rate as signs that Microsoft and Sony may struggle to drum up interest in their respective consoles

9 May 2013
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Games publishing giant Activision has warned of "uncertainties" surrounding the impending launch of Sony's PlayStation 4 and Microsoft's Xbox 720 consoles that could lead to a slow start for the next generation of games.

Speaking during his company's most recent earnings call, president and chief executive Bobby Kotick warned that the launch of the two next-generation consoles may not be the good news for the industry it would at first seem. "We continue to face the uncertainties of the console transition," Kotick warned investors. "There are still many unknown factors, such as pricing, launch dates and quantities, the level of first-party support and, importantly, consumer purchase intent in a world where consoles are no longer just competing with each other, but also with new platforms, such as smartphones and tablets.

"In addition, the newest console, the Wii U, has had a very slow start", added Kotick, voicing his concern over the poor performance of Nintendo's console - the first of the latest generation consoles to launch, and one that has proven a slow enough seller to see £100 lopped off its price since launch. "All of these factors further heighten our concerns heading into the back half of the year, particularly during the very competitive fourth quarter."

While hype surrounding Sony and Microsoft's next gaming console launches, Kotick is right to highlight questions as to consumer adoption: since the PlayStation 3 and Xbox 360 consoles launched eight years ago, mobile gaming has taken off in a way nobody predicted. The graphical quality of some games, running on high-end tablets and smartphones with powerful gaming chipsets like Nvidia's Tegra 4, rivals PS3 and Xbox 360 launch titles - yet cost considerably less to buy. The rise of free-to-play as a business model, where the basic game experience costs nothing but can be enhanced with the purchase of add-on features if required, has also taken the industry by surprise.

With Sony and Microsoft launching into a vastly changed environment, it's clear that the success of either console is by no means guaranteed - as proven by the slow adoption of Nintendo's Wii and Sony's own PlayStation Vita hand-held console, from which the PS4 control pad borrows its touch-sensitive strip.

Kotick was keen to reassure investors that Activision will weather the storm, however: despite its flagship World of Warcraft multiplayer online role playing gaming losing subscribers, the success of its Skylanders collectable miniatures game and new games from its sub-studios due to launch soon mean that it doesn't expect to be struggling for cash in the near future.

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