Sony vs Microsoft: Who Wants the New GTA IV Gamers More?

Is a new customer worth more than an old one?

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Sony vs Microsoft: Who Wants the New GTA IV Gamers More?
According to Mike Hickey - an analyst at Janco Partners - quoted by the Associated Press last month, "...5 million copies of GTA IV will sell the first week of release, on par with last year’s record-breaking $300 million first-week sales of Bungie Studios’ Halo 3.

"Hickey said Rockstar’s hush-hush promotional effort – more viral, less in-your-face than the Halo 3 campaign – could give GTA IV an edge".

So, big stakes to be played for. GTA IV, however, differs in one huge element from Halo 3 - it is not a platform exclusive game.

Rockstar and Take-Two's promotional activity (hush-hush or loud-loud) will be aimed at selling its game - to anybody who will buy it (or to anybody whose big brother will buy it for them). It has to be.

Retail will be in the same situation.

The fact that, come April 29th, the game is also going to be offered on both Xbox 360 and PlayStation 3 consoles, Sony and Microsoft will be pushing hard. Here lies the question for the day: GTA IV can benefit both Sony and Microsoft but unless there is a miraculous statistical confluence of exactly 50/50, one of them is going to benefit more than the other, so "Who wants it more and why?"

By this we mean, "Who wants the new customers brought in by GTA IV more?" The only real way to assess this is via marketing pre-launch... and maybe by effort.

Shane Kim, corporate vice president of Microsoft Game Studios, has already made it very plain what he thinks about the battle. Speaking to Wired earlier this year regarding the game's launch, he stated:

"I think it really is about marketing, right? We already own it, I believe, from a content standpoint, because we have the exclusive episodes. And so Xbox 360 is still going to have the ultimate experience for GTAIV. But we have to make sure the customers know that.

Because if you look back, again, to the role of GTAIII and what that played in terms of PS2's development -- in Europe as well, because it was huge in Europe -- GTAIV, first time on our platforms, so that's a great opportunity for us. We need to take advantage of it.


This has recently been supported by Microsoft spokesman, David Dennis, who told Next-Gen, "We’ve got a lot of marketing muscle behind products like Grand Theft Auto IV, and we certainly plan to have consoles on shelves available when that game launches, so that there are no supply issues by that point in time.

We believe that the value-add of having additional premium content for Grand Theft Auto on our box will certainly be a sales driver for the console. …"

Let's not forget Microsoft's apparent $50m payment to Rockstar for exclusive episodic downloadable content. The figure arose from an analysts call last June that contained the following exchange:

Evan Wilson - Pacific Crest Securities
"Thank you. And as it relates to the deferred revenue chunk associated with the episodic content on X-Box 360, you can see that $25 million of that moved into short-term deferred. Could you give us any sense of when that’s going to hit the P&L? Will we see $25 million at one time and then the second 25 or will it be a slow bleed?"

Lainie Goldstein - Take 2 Chief Financial Officer
"The first 25 is for the first episodic content package that’s supposed to go out and that is in March of ’08. That’s why it moved into current because it’s in the next 12 months. The second 25 will be for the second episodic, the episode, and that will be later in fiscal ’08."

Sony's response, you might recall, came from Jack Tretton (President and CEO of Sony Computer Entertainment of America (SCEA)), who on looking at the GTA IV as a hardware seller, told The Street:

"There's no question that having the Grand Theft Auto franchise helped us a lot (with PS2) and helped us sell some units...

"No, I don't think it (GTA IV's non-exclusivity) hurts us. No, I really don't."


So, if Jack doesn't think it's important, is it?

It's a long held belief business meme that getting hold of a new customer is much, much more of an effort than retaining existing ones. Business managers the world over sit in seminars trying to work out just what the 'cost of customer acquisition' and how to minimise it.

Right now, in terms of customer retention, Microsoft holds the strongest hand. The Xbox is long forgotten (admit it), the 360 is the centre of its gaming attention in Arcade, Elite and Premium format. Its 'installed base' is settled. GTA IV is coming out for its format.

Sony, on the other hand sees GTA IV launching on PlayStation 3 only. Its current hardware brand leader, the PlayStation 2, will see users leaving - in order to buy the game. They will be leaving to either the more expensive PS3... or they could jump brand entirely to the 360.

So far then, Microsoft stands to benefit more - and appears to be doing more. The news today that it is to introduce price cuts across all Xbox 360 stock keeping units (SKUs) is a strong indicator that the company is revving up for the battle. Its Xbox Live competition, 'GTA IV Sweepstakes', which offers the chance for gamers to win a trip to New York is also a strong indicator that it see Rockstar's game as major driver (sic). The only way you can enter is to have an Xbox Live gamertag - and if you've got one of those, hell, you might as well have a 360.

In the UK, major High Street retailers Game and GameStation are offering 500 Xbox Live points if you pre-order for the Xbox 360. It's doubtful that either retailer stumped up the cash to cover this. Game is also offering £3.50 worth of Game reward points for both PS3 and Xbox 360 versions.

One final point to note, however, could be that for the gamer who doesn't - gasp - like enjoy GTA, Sony's recent Blu-ray win would have far more impact as a platform seller than any non-exclusive game, no matter how big.

Having taken this time to look back over the build-up to the GTA IV four things come to the fore:

1) Microsoft appears to be expending more time and energy - even if only by words and a few (free Xbox Live points etc) actions. It seems to see more benefit.

2) Sony either doesn't see GTA IV as a hardware seller or doesn't care.

3) There is still more than a month to go and no one wants to blow budget.

4) GTA is no no longer a hardware seller.

We've contacted Microsoft, Sony and Rockstar today to see what marketing activities are in the offing, so far.... so no response from any of them.

In the meantime would GTA IV make you switch gaming brand? Would you move from 360 to PS3? Or would you abandon PlayStation entirely for the Xbox 360? Tell us in the Forum.
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Comments

spung 5 Mar 2008 18:11
1/15
After reading all of the previews for GTA 4, for the first time I have thought about upgrading from the ps2 to the ps3. I think brand loyalty will stop most ps2 users from jumping to the 360 as most people either, wanted more incentive, or a lower price to upgrade. I think I will buy the 40G and upgrade the drive at the end of April for GTA!
SiPie 5 Mar 2008 18:48
2/15
As someone who waited AGES and queued til midnight to get a PS3 at launch, I have to admit that the thought of missing out on DLC and such worries me. I might get a cheapo 360 later off ebay if the DLC turns out to be something I'll feel bad missing. Would I sell my PS3? We'll see how it goes. I don't play online enough to want to pay for it but still want to have the option to waste a few hours. I did have a concern that the 360 version is slightly better graphically but then that was the case on GTA III, Vice City and San Andreas when comparing xbox and PS2 and I wasn't that fussed then. Hooray - a few hubcaps look different, big deal. Anyway, if Microsoft want to win this battle they need to tell everyone what the downloadable content is. My guess is they're holding off because it's going to be far more underwhelming than everyone is speculating and will end up making little difference.
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Jonathan 5 Mar 2008 18:51
3/15
I was considering getting a PS3, but the 50Million purchase from Microsoft of episodic content - that sounds like it will be very good, so I'm going with the 360.
config 5 Mar 2008 18:53
4/15
Thinking back to PS2, many bought that console for its DVD capabilities.

Now, the GTA lovers of those people that have yet to go next gen will be looking which way to jump, and the factors typically considered are;

1. Console price
2. Brand loyalty
3. Exclusive GTA content

Now that the HD war (okay, skirmish) is done I think Blu-ray will be an important additional factor in the decision process.

Though some say they care not a jot about HD movies, the gadget nut on the right shoulder is going to be whispering "with PS3 you'll have an HD player AND an upscaling DVD player". This affects the perception of the console price.

The true casual GTA gamer, who picks up the game for a quick 10 minutes, may not know or care about all that HD shenanigans - but then those folk prolly don't know or care about this exclusive download content either.
Mornelithe 5 Mar 2008 19:14
5/15
I know several people who are going to buy a PS3 for GTAIV's launch. So, I aigree with you Spung. I think most GTA fans will get it for PS3/purchase PS3's just because it's the brand they started on.


Morne
The_Con-Sept 5 Mar 2008 19:50
6/15
It really doesn't matter who has more content on a GTA game because they have tried this in the past with the PS2 and the XBOX. The PS2 version came out and did quite well and then the XBOX version came out later with "upped graphics and extra's." But it didn't seem to affect the consumer market on the XBOX side.

Now since microsoft keeps praising the extra content they need to keep in mind that a majority of GTA players don't play GTA's story more than twice.
People play GTA just to F*** around in the city with the cops. Having those extra episodes isn't really going to be a major factor in which version is better because of these two simple reasons:

1. This extra content will not show up until August.
2. Microsoft spent 50 Million to obtain this extra content and I highly doubt it is going to be free. If these "episodes" cost more than half of what the game cost's then a lot of people are going to ignore it. I would rather be able to buy another new GTA game than a new "setting" for the old map.
Bentley 6 Mar 2008 00:52
7/15
I also know people who are gunning for a PS3 before GTA IV comes out. And have no interest in a 360. Many of my friends bought a PS2 just for GTA3, or GTA Vice City, and feel some kind of loyalty that will be rekindled by buying PlayStation again.

Or, as one of them put it, "I'm not having that c**t upstairs playing GTA on his 360 at launch while I'm sat in my room weeping while listening to his sirens". Or words to that effect.

I wonder how Rockstar managed to squeeze it all onto a standard DVD for 360, and if PS3's version will have any higher quality audio and/or textures... I suspect they'd not be vocal about such matters in case they upset the folks who gave them so much dosh for downloadable content in the first place.

I also wonder if the "exclusive" content is a true, true exclusive or there will be a time limit on it? Although I doubt it, as $50million should really buy "true" exclusivity. The DLC is a factor when it comes to a game like GTA, but I'm happy to play the PS3 version until I've had enough of it, by which time I might be able to pick up a 360 in a bargain bin.
deleted 6 Mar 2008 01:24
8/15
It’s got to be Microsoft, who’s going to make the money on this one, let’s look at it like this,

Firstly episodic downloads have already convinced me to buy for my 360 over my ps3, but more importantly,

there are a lot more 360 out there than PS3`s meaning the target audience is already bigger with 360`s also not to mention those who own both consoles as I do will probably go for the 360 version over the PS3 for the episodic.

It’s a no brainer,

But that doesn’t mean that PS3 won’t get episode 3 and so on or that 1 and 2 will never grace ps3 as maybe a its a time based deal who knows, but for the day one sales MS will reap.

As for console sales, unless people are stupid they will look at games for both systems and make an informed choice, my understanding of that would be the 360 is better equiped right now to take that on.
Gregormeister 6 Mar 2008 08:49
9/15
GTA IV will be a hardware seller for both, the 360 AND PS3. I've got some friends who own a Wii or no console yet and GTA IV will be a very good reason for buying a next gen machine. But the problem for 360 is (in my oppinion) that it had it's climax yet and the next Xbox will be there soon (in 2-3 years), whereas the PS3 is still takin' off and will surely show a lot of impressive games in future. So GTA IV will be an initial aid for both, but in the long run it's more clever to buy a PS3.

Oh, but I have to clear up two things: First, I'm from Germany and here in Europa there are more Sony lovers than MS's. Second, I own the PS3 from the first day and all my nearby friends see daily what the PS3 is able to do and they want to get that powerhouse, too. If I had a 360, it COULD have been the other way round, but not for sure, because we all had a PS2 before.
Peter Hurt 6 Mar 2008 09:31
10/15
Yep I'll be buying a PS3, the xbox 360 doesnt interest me in any way. and GTA 4 Is a definite PS3 seller
James 6 Mar 2008 10:03
11/15
I'll be getting the 360 version, for the fact gta4 was developed for 360, most ps3 ports are slightly poor (fight night, orange box, )

But mainly for the DLC content, if DLC 'as rockstar said is like a massive expansion, a whole new city or area will be exclusive to 360 why buy the PS3 version?? (PS3 price, no rumble, and possible port issues) If MS reduce the premium 360 price to £199 as rumoured next month then all the more reason.
SuperSaiyan4 6 Mar 2008 11:26
12/15
I could sit here and write up some fanboish comments but I won't.

All I can say is lets see who does better, I am sure Sony might offer GTA4 free when you buy a PS3 and the many PS fans out there might be waiting on such a deal just for that game alone.

Then you got the 360 owners or the Xbox gamers that are waiting on perhaps something similar and the icing on the cake for them is the extra content and same goes for current Xbox 360 owners too.

Its all well and good having the extra content but hopefully their wont be any graphical setbacks like screen tearing...Thats one thing I have noticed with this gen games is that there seems to be a lot of screen tearing on many games or graphical problems of sorts.

But overall even though the 360 userbase is higher who knows GTA4 could help boost PS3 sales even higher.

Lets just wait and see everyone's a winner because we all get GTA 4.
Capitalflush 6 Mar 2008 11:51
13/15
I think MS and Xbox360 fans have missed a great point in their appraisal of console sales or perhaps they have but choose to ignore it because it doesn't do them any good. Brand-loyalty, only mentioned vaguely in the article above, is more important than we really think. And given the nature of console owners/gamers, the vast majority of them are inmensely brand-loyal.

So if we take into consideration that PS2 was making bigger profits for Sony in most of 2007 than its PS3, we can conclude that there are many PS2 owners still out there who haven't bought an Xbox360 and who most likely want a PS3 but have waited for prices to fall. And they already have with the 40Gb version. And also if we remember that PS2 was the leading brand during its age of existence, this makes up for many gamers out there who are only now starting to buy their PS3's.

And what is it that is making them stay loyal? The reason is that they believe truly that PS3 is more powerful and that its real capacity will be proven in the near future when game producers realize its greater capacities and begin making games from PS3's perspective. There are rumors in the internet that PGR producers are designing up a game that is evolutive of its predecessors that is no longer possible to conceive with Xbox360's operating capabilities, this is a sign to gamers that Xbox has reached a maximum point of capanility. Is this rumor true or false? Either way is there a grain of truth in this? If you read between the lines, you will find the unavoidable comment this rumor is making, "Xbox is either now or in the near future going to be outdates, and fast" - be it because of BluRay or its impressive CELL processor?

When PS3 owners are confronted with Xbox360 fans and are told that some games look better on Xbox's than on PS3's, Sony fans say that the reason for the difference is that those games in particular were made for the Xbox and when traduced to PS3 format (which is a completely different format) the quality was compromised, although graphics were almost the same save some brightness difference and minor dynamic light differences. Is this a poor and fake excuse or is there sense in this reasoning?

Some say that the Xbox is the console of "the now" and that the PS3 is the console of "the future". Are they right? Only time will tell. I believe MS's scheme with GTA is very smart but I feel as if I'm being swindled because they are making a very nice attempt at making me buy a product of theirs that seems outdated.

If we just imagine that MS hadn't made all this effort with GTA, that they haven't bought exclusive episodes, where does this leave us? If MS is doing this, it is for a reason. What is their fear? If you can answer this for yourself, you already know what MS thinks of its console and what it knows of its rival.

If you wish to contact me on this, email me at capitalflush@gmail.com
Jay 6 Mar 2008 12:21
14/15
50 million is a big investment for added content, but i dont think this argument is won and lost with what rockstar plan on delivering and i dont believe that content will push sales for either console. those upgrading from previous consoles will do so based on more than what GTA offers them.

take the inclusion of blu ray on a ps3 for example. what console you buy will depend on where you stand on high def and whether you intend to "upgrade"you're dvd collection. you would be nothing short of stupid to spend 200 quid on an xbox and 300 quid on a blu-ray player if you can spend 270 quid for an all in one system on ps3 with an equal gaming experience. then again if you dont like blu ray or are more inclined towards digital rentals - why spend 70 quid more on a system that has what can only be descriibed as less GTA 4

equally allegiances will lie with other game exclusives on each console. halo 3 or killzone 2? bioshock or gran turismo 5? gears of war 2 or final fantasy 13? if you are gonna buy a console, you do it based on the games you know. ps2 users IMO will buy ps3's if they were happy with the games available. but then again, if you've got a ps2 and cant get ahold of a ps3 first gen 60gig, you may well upgrade to xbox for sony's stupid decision cutting out backwards compatibility on ps3 - that would have d**ked me off

but then again i'd prefer a console that worked as well, and with microsofts RROD hitting the headlines on N4g time and time again some will ask whats the point in having gta added content if you cant play it.

in summary GTA is a great game that will push hardware sales as last gen consoles are thrown out for current gen consoles, but those updating their systems will do so based on more than some added content in a game that is multiplatform.
BigRocketLauncher 6 Mar 2008 14:24
15/15
Bentley wrote:
The DLC is a factor when it comes to a game like GTA, but I'm happy to play the PS3 version until I've had enough of it

Which'll be about the time the DLC comes out - but when I'm done with a game I just don't go back. I 've got all the GTAs sat there and haven't ever replayed. Never even finished VCS. On that point - Remember that a LOT of people don't even finish games before growing tired of them - their interested won't be invigorated by a few new missions, cars or weapons.

Anyway, with GTA after a while the missions are the sideline and the sideline sandbox playground becomes the real reason to play. I just don't see myself being all that bothered about the DLC when it finally shows. Plus, who says Ps3 isn't getting DLC?
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