Ubisoft: Concentrate On Top Xbox 360, PS3 Franchises For Success

Author: by Chris Remo, Staff

Talking on an investor call following its earnings restatement late last week, Ubisoft's Yves Guillemot and Alain Martinez have been discussing the state of the Splinter Cell and Assassin's Creed publisher. In addition to recently Gamasutra-reported questions about the Avatar game and the I Am Alive reboot, the company's CEO and CFO made a number of other notable comments about the French-headquartered company's plans. In particular, Guillemot commented, similarly to recent remarks by Take-Two: "We will focus more on our major franchises, ensuring they can be released more regularly with the standard of quality required to maintain their profitability... We will create less brands in the future." The Ubisoft boss noted that, as DS and lower-profile new titles start to fail for them in a potentially overcrowded market: "Resources will be transferred from new projects to our top franchises, like we did for Assassin's Creed II and also for Splinter Cell [Conviction]." Indeed, Ubisoft will be "...much more focused on big franchises for Xbox 360 and PlayStation 3, the two consoles that should see software growth for gamers' titles in 2010." However, Guillemot did note: "We also continue our investment in the online genre." Internal Spend... Flat? Moving on to finances, CFO Martinez commented: "We're looking at the total amount of millions of euros we will spend this year, whether on internal production or external production, compared to last year." The investment going forward is now intended to be flat year on year, and it was explained: "The goal is not to increase too much the number of people that we will recruit this year." The Ubisoft execs continued, suggesting no major internal layoffs at the firm: "There will be some countries that will increase, and some that will decrease in fact, but just by natural evolution of those markets because you have people coming and leaving." Towards AAA, And Away From DS Guillemot added in the call, explaining why its core self-owned titles are most important, going forward: "Our plan is to take more care of our own franchises, we will have less place for licensed games." CFO Martinez chimed in: "If our figures are correct, There has been a major drop in our DS market. I believe it's gone from $300 million to $100 million. I'd have to check that. But it's a major drop. And more than anything, a lot of the sales in that market have been done at a very low profit, if not a loss." Thanks to the low margins, Ubisoft has radically reduced its reliance on DS. Martinez continued: "So I don't know what's going to happen next year exactly. There will of course still be some DS products, but even if we have a drop in the DS market, it shouldn't have a very negative impact on our bottom line [due to Ubisoft significantly reducing its DS slate]." Hints At Natal/Sony Launch Pricing? Finally, Guillemot tackled the launch of the motion-controller platforms for Microsoft and Sony, commenting: "We will fully support the Natal launch as well as the Sony launch." He then hinted at likely pricing for the peripherals, commenting: "We have lots of good quality products that are coming for the launch of those platforms. It represents a reasonable investment, the equivalent of one full-priced game." This comment seems to imply that Natal and/or Sony's peripheral will launch for around $60, but is relatively oblique.