RE: "Also on Iwata's list of unimpressive technologies are further motion control extensions, such as those being pursued by Sony and Microsoft, and higher-definition graphics."

This is surprising given that Nintendo had considered a Natal-type controller, but decided against it because of the implementation cost. In addition, the Wii does not have the processing ability to manage the full motion tracking and AI that will be present in Project Natal.

Remember that the Project Natal included, originally, a processor in the camera which would take care of most calculations before handing the results to the main CPU. Microsoft removed it to make it cheaper, which gives the reason to Iwata about the price.

About the "How is that going to look to other people?" phrase: it brought a lot of discussion at NeoGAF. Without the original interview, it is possible that something was lost in translation (he is not really someone to use irony -- PS: even in English he may have wanted to say something different). The assumption is that he was referring to how 3D games would look to people who are watching the game but don't have the glasses (a mess of distorted red and blue).

@ David

Well, he's right, the iPad is nothing to write home about. If the platform was strong enough to be a current generation game console while being portable you'd have something. If it gave a cheap and usable entry point in to MacOS while extending the iPod/Phone UI you'd have something. As it stands, you have a really big iPod touch, like the man said.

second point - is anyone in their right mind excited about natal? He's right, it will never drive platform sales and personally I dont think it will make back the cost of development in peripheral or first party software sales.

lastly - ya, I think he's just being petty about the 3D glasses.

All of his observations are predictable and defensive, but I still agree with most of them.

Edit :

@ Robert - thx, for the correction re: Iwata's 3D comments. That actually makes much more sense.

Yeah I definitely think that the statement makes much more sense as a case for "How will the screen look to people without glasses?" than "How will people look wearing glasses?". This article makes it read as though it's the latter, however, with it's reference to physical motions whilst using the Wii.

I would also suspect that he meant the former. Looking at motion 3D without 3D glasses is very disorienting and unpleasant. I wouldn't want it in my home.

great comments thanks for the clarification

DataBoards and 3D technology is the future, whether nintendo likes it or not. It represents a more costly future for them in which they wont be able to ride off on old technology and cheap gimmicks to succeed. At one point or another, they will have to make a serious investment if they want to compete and be willing to take the risk along with the reward.

@ Richard

Regarding your second point: Natal will never drive platform sales.

It is too early to tell. One thing I have seen over the years is that radical innovations like Natal are often not successful when they are first introduced, but they eventually find their way into various products. I am confident that Natal or a similar technology will eventually become commonplace and will change the way we interact will all kinds of devices, not just game consoles.

3D technology will only be the future when glasses are not required. For example, 3D holographic projections, rather than 3D glasses. Glasses prevent 3D graphics from being social and shared, while projections allow a group to enjoy an experience together. For example, will we all be expected to wear 3D glasses while watching friends play Soul Calibur V or Starcraft III, or even while simply watching TV in a bar? Glasses are ultimately a dead-end technology in terms of affordable consumer technologies (although they will have plenty of specific uses in the future; for example, private viewing). Glasses are, in internetz, a gimmick.

I'm with Iwata on all points.

I have no need for a larger Touch, but would gladly jump on an OS X based tablet from Apple. At that size and price for so-so storage, it's just not worth it imo.

If Avatar 3D is the cutting edge, it's not to a point that my eyes like it, but at least it didn't give me a headache like earlier tech.

I agree with you Carl, get rid of the glasses and provide a natural 3D experience and I'll be all over it.

I'm not keen on Natal, but maybe it will be fun. Just keep it away from my work. The last thing I want is a Minority Report future where I have to be a spaz like Tom Cruise just get a simple task done.

Jonathan Osment,
Read up on what Nintendo has done for the industry as a whole and on more than one occasion. After reading your comment, I'm sure it will be an eye opener. It's pretty clear that you're not familiar with their history.

3D without glasses is almost here. Patent pending.

http://www.cubicvue.com/

@ Richard Putney

"second point - is anyone in their right mind excited about natal?"

You are kidding right?
You must be living under some rock out in the mountains somewhere.
I have been following the video game business for a long time, and I have never seen any new video game product generate as much excitement in the mainstream/non-gaming media as Natal did last year after E3, a full 18 months before its even launched.
Not only was Natal on "Good Morning America", Natal was on late night TV as well, and in hundreds of newspapers and non-gaming magazines.
Neither "Good Morning America" or "Late Night with Jimmy Fallon" are gaming programs, and they don't bring people over unless they are excited about the product and think it will help their ratings.


"Project Natal makes Appearance on Late Night with Jimmy Fallon and Good Morning America!"
http://gamingconsolenetwork.com/tag/good-morning-america/



"He's right, it will never drive platform sales and personally I dont think it will make back the cost of development in peripheral or first party software sales."

You are talking total, unadulterated crap!
Read this:
"Analysts see Project Natal adding billions to Microsoft's revenue
Friar and Derek Bingham of Goldman Sachs. The analysts make a series of assumptions -- including an $85 retail price for the camera-based system -- and estimate that Natal will boost Microsoft's revenue by $1.7 billion in its 2011 fiscal year (which begins in July 2010) and $2.3 billion in its 2012 fiscal year."

http://techflash.com/seattle/2010/01/analysts_see_project_natal_as_microsofts_ne
xt_billion-dollar_product.html

@ Kevin Jones
"Analysts see Project Natal adding billions to Microsoft's revenue
Friar and Derek Bingham of Goldman Sachs. The analysts make a series of assumptions -- including an $85 retail price for the camera-based system -- and estimate that Natal will boost Microsoft's revenue by $1.7 billion in its 2011 fiscal year (which begins in July 2010) and $2.3 billion in its 2012 fiscal year."

Goldman Sachs say, they think the hardware will cost 85 US$, they say, it will drive revenues by 4 billion US$ in the fiscal years 2010 and 2011, the don't say anything about software, so I take it for granted, that they say this 4 billion US$ in revenue will be made with the hardware.
85 US$ per unit and 4 billion US$ revenue in the fiscal years 2011 and 2012 means that MS has to sell 47 million units of Natal in around 20 month, this means, they have to sell 2.35 million units each month. I have seen many things, but I am pretty sure, I won't see Natal sell 2.35 million units each month for 20 month in a row.

@ Chris

"I'm not keen on Natal, but maybe it will be fun. Just keep it away from my work. The last thing I want is a Minority Report future where I have to be a spaz like Tom Cruise just get a simple task done."

The mistake many people make is assuming that products like Natal are "all or nothing." In fact, the motion sensing, AI, and voice recognition features in Natal will complement existing technologies. In areas where motion sensing makes sense, users will be using the tracking camera. In areas where traditional controllers are warranted, they will still be used. In many cases, both interfaces can be used together quite effectively.

I devote several pages in the epilogue of the book explaining why Natal will be a game changer for the industry, even if Microsoft somehow screws up the implementation.

@ Christian

I agree with you that those numbers seem excessively high. Many financial analysts simply do not have the proper industry grounding and therefore false assumptions often enter into their equations. A few years ago, most of those analysts were predicting that the Wii would be a flop. Some got it right however, because they were the ones who followed the industry closely and saw the enthusiastic response to the Wii during the 2006 E3 announcement.

@ Christian Keichel

:"Goldman Sachs say, they think the hardware will cost 85 US$, they say, it will drive revenues by 4 billion US$ in the fiscal years 2010 and 2011, the don't say anything about software"

This is what Goldman Sachs said: "and estimate that Natal will boost Microsoft's revenue by $1.7 billion in its 2011 fiscal year (which begins in July 2010) and $2.3 billion in its 2012 fiscal year."

That means Goldman Sachs expects Natal hardware, Natal first party software, Natal 3rd Party software ( License fees), Natal XBOX 360 bundles, and Natal everything else to boost Microsoft revenues by $1.7 Billion and $2.3 Billion in fiscal 2011 and fiscal 2012 respectively.


" so I take it for granted, that they say this 4 billion US$ in revenue will be made with the hardware."

WRONG assumption. There is nothing in the Goldman Sachs note that says that.


"85 US$ per unit and 4 billion US$ revenue in the fiscal years 2011 and 2012 means that MS has to sell 47 million units of Natal in around 20 month, this means, they have to sell 2.35 million units each month. I have seen many things, but I am pretty sure, I won't see Natal sell 2.35 million units each month for 20 month in a row"

You made a wrong assumption, then proceeded to to base your calculations on that wrong assumption. It's like building a house on a weak foundation of sand.
All you had to do was do an internet search. You would have found out that Goldman Scahs, specifically stated that they expected a total attach rate of 56% after 2 years.{http://www.techflash.com/seattle/2010/01/analysts_see_project_natal_as_microsoft
s_next_billion-dollar_product.html}.
Also, Natal will come bundled with the 360, so therefore if total 20 million 360's are sold in fiscal 2011 and fiscal 2012 (Assuming a small boost in 360 sales), that means 20 million Natal units in people's homes by the end of fiscal 2012, even if the standalone Natal unit sells zero units. Of course the Natal standalones will sell millions as well.

Ubisoft alone is on track to release 10 Natal games in it's first 5 months alone:
http://www.1up.com/do/newsStory?cId=3177140

Plus 70-80% of 3rd parties are working on Natal games right now:
70-80% of Publishers Working on Natal Games.
http://www.ripten.com/2010/01/14/publishers-working-on-natal/

In addition, Aaron Greenberg from Microsoft has already predicted millions of Natal units to have been sold by Christmas this year alone, despite Natal itself only coming out around November this year.

"Greenberg claims millions of Xbox 360 Natal units to sell by Christmas 2010"
http://gamer.blorge.com/2010/01/10/greenberg-claims-millions-of-xbox-360-natal-u
nits-to-sell-by-christmas-2010/

As for Goldman Sachs, they not only predicted that Natal will sell, they backed it up with money, by making MSFT a "buy", and then raising MSFT's target price to $35, based in part on big Natal/Natal games sales.

Goldman Sachs Raises Earnings Estimates for Microsoft (MSFT)
Created by Dividend.com

Software giant Microsoft Corporation (MSFT) saw its earnings estimates raised on Monday by analysts at Goldman Sachs.
The analyst said it raised its estimates for MSFT through 2012, citing expectations for the success of Office 2010 and Project Natal. Goldman currently rates the stock as a “Buy” with a $35 price target.
http://www.nasdaq.com/newscontent/20100125/GoldmanSachsRaisesEarningsEstimatesfo
rMicrosoftMSFT.aspx?storyid=8338

I would say that a Goldman Scachs recomendation to their clients to buy MSFT stock, based on projected Natal sales, carries a heck of a lot more weight than some post on an internet board from some guy that calls himself "Richard Putney", that nobody knows an anything about, wouldn't you?

@ David Wesley

" few years ago, most of those analysts were predicting that the Wii would be a flop. Some got it right however, because they were the ones who followed the industry closely and saw the enthusiastic response to the Wii during the 2006 E3 announcement"

Well there was an even more enthusiastaic response to Natal at the 2009 E3. Natal generated more buzz at E3 than anything else.

Project Natal generated most E3 “buzz” says research firm
http://www.electricpig.co.uk/2009/06/08/project-natal-generated-most-e3-buzz-say
s-research-firm/

Microsoft's No-Controller "Natal" Steals the Show
http://www.pcworld.com/article/165891/e3_microsofts_nocontE3:roller_natal_steals
_the_show.html

@ David Wesley,

If it's a compliment, I'm OK with it, so tracking my head while playing GRID on my PC, something similar to IR-Tracker.

I'm not into voice commands though, I never have been. I only like to talk during games when in the same room as friends, or playing online via STEAM. But I'm not opposed to any improvements on the tech, since it can provide more accessibility for some.

Chris Melby said: "But I'm not opposed to any improvements on the tech, since it can provide more accessibility for some."

What we have to be open to is the possibility that the "some" that we are talking about can mean a large number of people. MS's Sync technology on some Ford vehicles have been catching on in popularity and perhaps it's only a matter of time before voice interaction with computers is more commonplace and is a standard. Though maybe we have to credit Gene Roddenberry for that rather than Microsoft. :)

It's interesting that Iwata looks at the other tech as "features" that people will buy. The Wii itself sold well because of it's software, which made good use of it's features. He should know better than most that if Sony or MS has great software for their motion controllers, they will sell. Great software meaning games that are easily understandable by the public (not only in terms of gameplay, but in concept as well...a dancing game makes more sense than a "stop that leaking pipe with your hands" game) that are enjoyable to play.

Secondly I find it odd if Iwata was meaning to deride the iPad as being not much different from previous Apple products. The DS Lite, DSi, and DSi XL are for the most part the same sort of device. In fact the DSi, without it's GBA backwards compatibility, is a tad inferior to the previous version in some respects. Yet despite this these new iterations of the DS sell well, something we can expect for the iPad (keeping in mind that the announcement of the DSi was met with mixed reaction as well).

Amir, regarding your third paragraph, "Iwata looks at the other tech as features that people will buy", remember that Nintendo, contrary to Sony and Microsoft, designs the console around the games instead of designing the games around the console. In other words, they think in the games they want for the console and then build a console able to run these (before the Wii, it was really noticeable with the N64, where they build the controller around Mario 64). They expect these addons to not catch (Eyetoy, even in the best estimations, sold 12m units in a 140m playerbase, less than a 10% attachment).

Finally, I would believe it is not fair to compare previous Apple products and the iPad with the DS Lite, DSi and DSi XL. The iPod was a music player, the iPhone a mobile phone and the iPad a tablet PC, three completely different product that happen to look the same. The DS, DSL, DSi and DSi XL are all handheld consoles. People expected much more from the iPad, and instead obtained a supersized iPhone that doesn't run OSX and can't multiprocess. If you want, you could compare the iPhone and iPhone 3G with the DS family, but not different products.

With all this talk over the excitement of Natal. The one thing missing is the games it will sell. As a gamer that owns a Wii and a PS3, I can't honestly see either Natal or the PS3 wand making that much of a dent in the Wii's current market. The reason is very simple. The games those systems currently market and sell are vastly different form the games the Wii currently markets and sells. Even if Microsoft or Sony where to copy one Wii game with their Model controllers they would still have to sale the device, which at best is seen as a external add on rather than an extension to whats already there. Also they will still have several other gaming models to compete with concerning Wii games. So I would say that even if The two devices are slated to do some sales, they will be modest at best, and both companies best bets are to package the controllers with the consoles, and slowly fade out the old SKUs that don't include them.

@ Kevin Jones
Fun with numbers, the next chapter

IF MS is releasing Natal in November 2010 and if the attachement Rate is 56% 18 months later, this would mean, that they sold around 28 million units (I would say it is a conservative, but safe gues to say, they will have sold 50 million consoles at the end of fiscal year 2011).
Keep in mind, that I give MS here the advantage, that they sell EVERY Natal für 85 US$, even the packed ones. This is unrealistic, but I do it nonetheless.
This means, MS must sell 1.55 million Natals per month, 18 month in a row.
This Natal hardware would generate 2.4 billion US$ (only if they don't drop the price during this period, I can't remember any XBox Hardware, that had a stable price for 18 months, but let's don't take that into account).
This leaves 1.6 billion US$ to be made with Natal software.
Currently, I think it is safe to say, that 360 revenues in general are made up of 1/3 first party sales, Nintendo is responsible for 47% of it's revenues, as Pachter showed us earlier this month, so 33% for MS seems like a realistic guess.
This means that around 500 million US$ must be made with MS first party Natal titles, with a retail price of 60 US$, this means MS has to sell around 8 million Natal games.
The problem is, we don't know how big the licence fees are, they are internal business between every developer and MS, but let's take a guess and say, MS gets 10% of the retail price as a licence fee, if you take into account, that the majority of the profit is generated at the retailers, this sounds a little bit too high, but for the example it can help to illuminate things.
To achieve the last billion of revenues with licence fees, MS gets 6 US$ in our example from every natal game copy sold,the 3rd party developers have to sell 166 million Natal games. This means over 9 million Natal games per month. Keep in mind, we thought, that 25 million Natal units were sold. By the same time, MS and all 3rd party publishers have to sell around 175 million Natal games, every Natal owner has to buy 7 games in 18 months. Right now, the LTD sales of all 360 games after 50 months on the market are 164 million.
(http://www.gamasutra.com/view/news/26856/Analysis_Wii_Overtakes_Xbox_360_LTD_Sof
tware_Sales.php)
Sounds like a bold prediction to me.

@ David

Agreed. The technology is definitely on its way to something cool, and I think we'll see refined implementations built in to the next generation systems. Alot of my skepticism isnt about the natal in particular but about post launch peripherals. It takes a triple A software title to move peripherals off the shelves, and this really seems like a "me too" play at Nintendo's casual market success rather than a genuine inspiration. Adding an expensive peripheral intended to attract casual gamers to a console they dont already own with mini games seems iffy to me.

@ Kevin

Your response speaks to how much marketing MS has put behind the project, not anyone's interest. With all MS has put in to hyping its product I've never heard a gamer say "oh, cant wait to try it" or a dev that said "Ive got great ideas I cant wait to implement on that thing." Just microsoft hype.

Ubisoft alone is on track to release 10 Natal games in it's first 5 months alone:
http://www.1up.com/do/newsStory?cId=3177140 <<< ALL CASUAL GAMES.

Are YOU gonna pay $85 for a natal so you can play some iPhone games?

As for Goldman Sachs, I will bet you all the tea in China that they downgrade that estimate well in advance of microsoft actually having to hit those numbers. Investors inflate stock price on news and then sell off at product launch for high profits, downgrade the stock when the numbers disappoint, rally a sell and buy back low. They're just exploiting the MS hype engine.. Are you just tuning in to capitalism or are you unfamiliar with goldman sachs' earlier work?

http://www.macon.com/272/story/995859.html < here's an interesting tip from goldman sachs on how to short your own investors for profit!

@ Christian Keichel

:"IF MS is releasing Natal in November 2010 and if the attachement Rate is 56% 18 months later, this would mean, that they sold around 28 million units (I would say it is a conservative, but safe gues to say, they will have sold 50 million consoles at the end of fiscal year 2011).
Keep in mind, that I give MS here the advantage, that they sell EVERY Natal für 85 US$, even the packed ones. This is unrealistic, but I do it nonetheless."

You still don't get it.
Natal is going to be bundled with every single XBOX 360 that is sold just like the Wiimote is bundled with every Wii that is sold. That means that at the end of fiscal 2012, there could be 20 million Natal units in people's homes, even if not even a single standalone Natal unit is sold to the over 40 million XBOX 360 install base at all. In reality, of course millions of standalone Natal units will be sold to th existing XBOX 360 install base as well.


"This Natal hardware would generate 2.4 billion US$ (only if they don't drop the price during this period, I can't remember any XBox Hardware, that had a stable price for 18 months, but let's don't take that into account)."

Nonsense.
You keep repeataing the same stuff that has already been discredited over and over again.
Goldman Sach's estimtaes of Microsoft making $1.7 Billion from Natal in fiscal 2011 and $2.3 Billion in fiscal 2012 is based on Natal hardware, Natal first party software, Natal 3rd party software licenses, Natal XBOX Live games, extra revenue from XBOX ve based on Natal games, and Natal everyting. It's NOT based on just Natal standlaone hardware sales.
I pointed that out to you in my previous post, only for you to turn round and repeat the same nonsense again.

@ Kevin Jones
You are unable to interprete the numbers you bring up. An attachement rate of 56% at the end of fiscal year 2012 would mean roghly 28 millions units, this is simple math. Goldman Sachs predicts 85 US$ for the natal hardware.
So, the hardware revenues would be 2.4 billion US$ maximum, I say maximum, cause, the bundled natal hardware wouldn't generate 85 US$ revenue, but you don't seem to understand, that this assumption I made is in favour of Goldman Sachs numbers, otherwise the hardware revenue for natal would be lower and much much much more software had to be sold.
Next thing Natal XBox Live games, I don't know, why you think those would sell in millions, can you show me one single XBox Live game that sold multiple million copies? So I think Xbox Live doesn't generate any significant sales.
You write:
"You keep repeataing the same stuff that has already been discredited over and over again.
Goldman Sach's estimtaes of Microsoft making $1.7 Billion from Natal in fiscal 2011 and $2.3 Billion in fiscal 2012 is based on Natal hardware, Natal first party software, Natal 3rd party software licenses, Natal XBOX Live games, extra revenue from XBOX ve based on Natal games, and Natal everyting. It's NOT based on just Natal standlaone hardware sales."

It seems you are not capable of reading AND understanding my posts, otherwise you would have noted, that about 2/3 of my last post were about SOFTWARE sales first party and third party, here I showed you with a simple mathematic example, that, with a licence fee of 10% of the retail price and a share of 1/3 MS Software and 2/3 third party software, it would be necessary to sell 175 million units of Natal software to achieve even 1.6 billion US$ revenue for Microsoft.
I would prefer, if you, instead of trolling around, show me your calculation, how MS should make 4 billion US$ revenue in 18 months with Natal Soft- and Hardware.
But my guess is, your answer will be again, like every time, that anybody else is an idiot. Come on surprise me with something else.

@ Christian Keichel


"Currently, I think it is safe to say, that 360 revenues in general are made up of 1/3 first party sales, Nintendo is responsible for 47% of it's revenues, as Pachter showed us earlier this month, so 33% for MS seems like a realistic guess"

Currently, the XBOX 360 had revenues of $3 Billion in the December quarter alone, and the XBOX business made it's highest profits ever in the last Decemder quarter, when it made $375 million in profits.
Don't forget, thhat when Microsoft launched Halo 3, Microsoft made more money in that month, than all the 3rd part games combined made on the XBOX 360.

"This means that around 500 million US$ must be made with MS first party Natal titles, with a retail price of 60 US$, this means MS has to sell around 8 million Natal games"

Listen, Halo Reach launch in Sepetmber 2010 alone, will probably generate over $500 million in just September alone( I am expecting Reach to shatter the 4.2 million MW2 sales in one month record), even before the rest of the year's Halo Reach revenues are factored in.
Microsoft always makes big money in the quarters that they launch their big first party games like a Halo or Gears game. he huge Natal launch shouldn't be any different
Making over $500 million from the big first party Natal launch games for the whole of fiscal 2011, shouldn't present much of a problem.


"The problem is, we don't know how big the licence fees are, they are internal business between every developer and MS, "

We have a pretty good idea of how much Microsoft is taking from the average 3rd party developer. Just do an internert serach and do some research will ya?


"To achieve the last billion of revenues with licence fees, MS gets 6 US$ in our example from every natal game copy sold,the 3rd party developers have to sell 166 million Natal games"

Not quite.
To make $1.7 Billion in fiscal 2011 from Natal shouldn't be too hard.
Let's just say Microsoft launches Natal with Natal XBOX 360 bundles, at a higher price(say $50 higher) than the previous unblundled non-Natal XBOX 360's. If Microsoft sells 10 million Natal XBOX 360 bundles in fiscal 2011, that gives you an extra $500 million from Natal, no?
Then let's say Microsoft sells another 5 million stand alone Natal units to the 360 install base of over 40 milion, at say $80 each, bundled with say a very good fitness game called Natal Fit. That gives you $400 million.
Then Microsoft releases Natal Sports, Natal Kate and Milo, Natal Brian Training etc, all of which have great XBOX Live components that make the games even more usefull, addictive and fun. Let's say that all those Natal first paty games sell 10 million in total at say $50 each. That gives you another $500 million.
So now we have $1.4 Billion revenues already.
Now let's assume that Natal leads to another 2 millin XBOX Live Gold memebers in fiscal 2011, at say $40 each. That gives you $80 million. Then we have sales of Natal themes on Live, Natal XBOX Live DLC for Natal Fit, etc, Natal XBOX Live Arcade games etc, let's just say that generates another $120 million in revenue,
So now we have $1.6 billion in Natal related reveues in fiscal 2011, no?
That's only $100 milion short of the Goldman estimates, and we haven't added in any 3rd party license fees from Natal games yet.
Seems pretty doable to me.

"Then Microsoft releases Natal Sports, Natal Kate and Milo, Natal Brian Training etc, all of which have great XBOX Live components that make the games even more usefull, addictive and fun. Let's say that all those Natal first paty games sell 10 million in total at say $50 each. That gives you another $500 million."

Funny right now, NO Microsoft title EVER sold 10 million copies. Sure, if they release 3 Natal titles, that sell 3.3 million each, everything is possible, but come on, in the last 50 months 3 MS titles have sold more then 3 million copies and you predict now 3 Natal titles for the first 8 months? Besides this, the 3 titles were Halo and Gears of War, both franchises, that don't get Natal treatment, at least not at Natal launch.

"Listen, Halo Reach launch in Sepetmber 2010 alone, will probably generate over $500 million in just September alone( I am expecting Reach to shatter the 4.2 million MW2 sales in one month record), even before the rest of the year's Halo Reach revenues are factored in."

So, you really predict, that Halo Reach will sell over 8 million copies in it's first month? This is simply laughable. And besides this, Halo Reach is not a Natal title, so it would count 0 to natal revenue.

"We have a pretty good idea of how much Microsoft is taking from the average 3rd party developer. Just do an internert serach and do some research will ya?"

I don't know who "we" is, if you have numbers, show them.

"If Microsoft sells 10 million Natal XBOX 360 bundles in fiscal 2011, that gives you an extra $500 million from Natal, no?"

Yes, but that would mean, that MS has to sell 10 million 360 in 8 months, right now, their sales are declining and they are miles away from selling 10 million in 8 months. Besides that, it would mean, that MS won't sell any 360's without Natal, something I doubt will happen.

Roberto Alfonso said: "remember that Nintendo, contrary to Sony and Microsoft, designs the console around the games instead of designing the games around the console."

I completely agree. Though I do get the perception (right or wrong) that they only seem to design a handful of titles or concepts at first, then build the hardware around it. I have been somewhat disappointed with 2nd, 3rd, and 4th generation titles on the DS and Wii for not being very different from the first gen of titles for the respective console. Once in a blue moon you do get an innovative title, yes, but it seems that the hardware quickly becomes limited in application. Take for example, the need to add Motion-Plus to the Wiimote. Again, I do agree with your overall point. While I love the accuracy of Sony's Motion controller and the accessibility of the Natal (both solutions seem quite robust and not as "limited" as the original Wii Remote), I am very skeptical that Sony and MS can create the sort of software they need to get everyone rushing out to buy one. You've mentioned the EyeToy, the software for that never grabbed the general public at all.

Roberto Alfonso said: "People expected much more from the iPad, and instead obtained a supersized iPhone that doesn't run OSX and can't multiprocess."

I understand that as well, but my point was more akin to "people expected more from the upgraded DS as well". The iPad is much like the DSi in that from Apple/Nintendo's perspective wasn't supposed to be very different from previous products, but the expectation from consumers was that it should have been. It's a battle between what the manufacturer's aims for the product were, and the expectations of the general public. Iwata shouldn't have really expected more innovation, as that wasn't the point of the product. I hope I'm making myself clearer here, I apologize for the confusion.

:"You are unable to interprete the numbers you bring up. An attachement rate of 56% at the end of fiscal year 2012 would mean roghly 28 millions units, this is simple math. "

Fiscal 2012 ends on June 30th 2013, that is 2 /12 year from now.
If Natal is bundled with every XBOX 360, and the XBOX 360 sales get a lift from the massive Natal launch, all Microsoft would need to do is to sell 20 million XBOX 360/Natal bundles in fiscal 2011 and fiscal 2012, and we already hve 20 milllion Natal units in people's homes.
After that, all that needs to happen is for Microsoft to sell another 8 million stand alone Natal units in fiscal 2011 and fiscal 2012, bundled with a very good Natal Fit game, and you have your 28 million aready.



"Goldman Sachs predicts 85 US$ for the natal hardware"

Microsoft can sell Natal at less than $85 and still realise the $1.7 Billion in Natal revenues in fiscal 2011, like I already explained in my post above.



"So, the hardware revenues would be 2.4 billion US$ maximum, I say maximum"

Non XBOX 360 bundled Natal sales are not that important. Bundled XBOX 360/Natal sales, plus great, addictive, Natal first party games is what counts.
If Microsoft is able to come out with some really great Natal first party games, the money will just keep flowing in.
Way I see it, Natal is jut perfect for fitness games and certain kinds of sports games.


"Next thing Natal XBox Live games, I don't know, why you think those would sell in millions, can you show me one single XBox Live game that sold multiple million copies? So I think Xbox Live doesn't generate any significant sales."

XBOX Live is what is keeping the XBOX business profitable right now, especially in the quarters when there are no Microsoft big first party games. With over 23 million Live members all of then buying DLC and themes and Arcade games and with the Gold members paying $50 per year, it all adds up to a good, regular revenue stream.

"It seems you are not capable of reading AND understanding my posts, otherwise you would have noted, that about 2/3 of my last post were about SOFTWARE sales first party and third party, here I showed you with a simple mathematic example, that, with a licence fee of 10% of the retail price and a share of 1/3 MS Software and 2/3 third party software, it would be necessary to sell 175 million units of Natal software to achieve even 1.6 billion US$ revenue for Microsoft"

That calculation was not valid, because you assumed that Natal first party launch game sales would be so low that Microsoft would need to sell 175 million 3rd party games in order to generate the $1.75 billion that Goldman was talking about. That is just wrong.
If you read my post above, you will see where you went wrong in your calculation.
Natal is like the luanch of a new console for Microsoft. There will be massive marketing and huge firsty party games. The console maker always sells a heck of a lot more software at launch of a new console than 3rd parties do.


"I would prefer, if you, instead of trolling around show me your calculation, how MS should make 4 billion US$ revenue in 18 months with Natal Soft- and Hardware"

I already have. You just can't see or hear so good.

"Funny right now, NO Microsoft title EVER sold 10 million copies."

# 1. Halo 3 has already sold 10 million units.
# 2. I mentioned at least 3 hypothetical games in my post, in addition to saying that those 3 games would be merely a part of a phalanx of Natal first party games, which could number as many as 10 by the end of fiscal 2012. All Microsoft would need, is for each Natal game to sell only 1 million worldwide, to meet my estimates. Launch first party games typically sell much more than a milion for console makers. Even the not so great games like Kameo ( a launch games for the 360) sold more than a million worldwide..

"Fiscal 2012 eend on June 30th 2013, that is 2 /12 year from now."
Ok, why Goldman Sachs says
"and estimate that Natal will boost Microsoft's revenue by $1.7 billion in its 2011 fiscal year (which begins in July 2010) and $2.3 billion in its 2012 fiscal year."
If fiscal year 2011 begins in July 2010, then is ends in June 2011, this means fiscal year 2012 ends in june 2012. At least this was what you were posting above. But at least you are right, it is 2 1/2 year from now, but in my universe this is june 2012.

"# 1. Halo 3 has already sold 10 million units."

When did Halo 3 cracked the 10 million units, must have missed the Microsoft press release stating this.

"# 2. I mentioned at least 3 hypothetical games in my post, in addition to saying that those 3 games would be merely a part of a phalanx of Natal first party games, which could number as many as 10 by the end of fiscal 2012. "

When did Microsoft ever sell 10 million copies first party software in 8 months? And how should they manage this without Halo and Gears of War? This would mean, they have to sell 10 million copies Natal software PLUS the usual 360 non natal software, this would mean, MS has to sell more like 16 million units of software in 8 months.

"When did Halo 3 cracked the 10 million units, must have missed the Microsoft press release stating this."

Halo 3 had sold 8.1 milliom as long ago as Jan 4th 2008, that is over 2 years ago.
http://www.totalvideogames.com/Halo-3/news/Halo-3-Sales-Slam-Through-8m-Units-12
014.html

And hit 10 million in August 2009"
http://news.vgchartz.com/news.php?id=4787

"When did Microsoft ever sell 10 million copies first party software in 8 months?"

Halo 3 alone sold 8 million units in 2007.
http://www.totalvideogames.com/Halo-3/news/Halo-3-Sales-Slam-Through-8m-Units-12
014.html

Forza 2 which was released in May 2007 (5 months before Halo 3), has sold 3.5 million so far.
http://www.autoweek.com/article/20091029/CARNEWS/910289987

If we assume that 2 million of Forza 2's 3.5 million sales, were in the 7 months of 2007, that makes it 10 million Microsoft first party games sold in 2007 (when added to the 8 milion Halo 3 sales). Easy.
And that is even before we add in Microsoft first party games like Crackdown which also came out in 2007, and sold over 1.5 million units.
http://www.next-gen.biz/magazine/crackdown-2


" And how should they manage this without Halo and Gears of War?"

Umm..Halo Reach is coming out in September this year, and it's going to sell gangbusters.

"This would mean, they have to sell 10 million copies Natal software PLUS the usual 360 non natal software, this would mean, MS has to sell more like 16 million units of software in 8 months. "

Reach alone will sell 10 million units before the end of this year, with or without Natal.
Remember, MW2 sold approx 10 million on the 360 alone in just November and December last year worldwide, and Reach will have 4 months of sales this year as compared to only 2 months for MW2 in 2009 (Reach will probably launch in September), and Reach will have a bigger instal base of 360's to sell to than MW2 did.
When you add in Alan Wake and Crackdown 2 (both first party games), Microsoft will sell at least 14 million first party games worldwide this year, before we even add in any Natal games.
Like I have repeatedly explained above, with Natal hardware bundled with every XBOX 360 at a higher price, there are going to be millions of Natal units in people's homes in fiscal 2011 and fuscal 2012, before any Natal standalone units are even sold.
The Natal units in people's homes will form the beachead into which Microsoft can then sell the phalanx of Natal first party launch window games, where most of the money is going to come from.
Its simple really.

@ Kevin Jones

Some day they're going to find you lying still in a clearing after drinking all that microsoft kool-aid you know...

@ Richard Putney


As long as I am not drinking Nintendo Kool Aide like you, I will be just fine.
Can't say the same about you though.

Hey, if I qualify as a fanboi of anything its the Fairchild! I dont even own a wii, although I'd trade my 360 for one in a heartbeat.

Look, I dont know if you work directly or indirectly for the evil empire, or just like the smell of bad code in the morning. I'm just trying to point out that people might take less exception with your posts if you were willing to entertain perspectives besides Ballmer's.

Most of us are here to discuss game design and development because its our our job, our interest and our passion. It helps us learn and grow. There's more to gaming than microsoft press releases, and I for one wouldnt mind having you be a part of the larger discussion we're trying to have.

@ Kevin Jones

Since when is VGChartz a valid source, when it comes to Software sales? Their numbers are pretty guesses, nothing more. You can be sure, if Halo cracked 10 million units, MS would have said this, cause it is a very important milestone.
The same goes for your 10 million 360 units of MW2. Do you have any valid source for this? You can be sure, if it cracked 10 million units on the 360, Activision would have told us.
I made my predictions and my interpretation of the Goldman Sachs numbers on the basis of the 360 hard- and software performance of the last 50 months. You make your prediction out of the blue. The first party numbers you are predicting for MS would make Natal virtually unintersting for any third party developer, cause they were better than those of Nintendo.
By the way, Halo 3 will make 10 million units in it's first 3 months? Dream on and take a look at the numbers of Halo ODST.