The recession is taking its toll on discretionary income, video games included, causing gamers to rally behind hit titles. But what do the big studios have in store for this year?
Analyst Heath Terry of FBR Capital Markets is covering video games once again, and weighs in on the biggest of the big: Activision Blizzard (ATVI) and Electronic Arts (ERTS)
Activision Blizzard: Heath is optimistic, likes the company management, and notes a strong lineup in the works including a relaunch of Tony Hawk and Diablo, a new racing title called Bizarre Creations, and movie-related titles such as Transformers, X-Men, and Ice Age.
We add two notes of our own to Heath’s: Movie-related titles are notoriously hit-or-miss, THQ’s (THQI) Wall-E bomb is but one recent example in a long line of failed movie-to-game adaptions. On the other hand, anticipation for sci-fi themed Starcraft 2, due out this year from the Blizzard team behind World of Warcraft, is running white-hot. (Warcraft, Starcraft, get it? Not a coincidence.)
Electronic Arts: A more cautious appraisal from Heath. The company’s workhorse, EA Sports (think Madden NFL), has been losing share every year since 2003. Franchises like Need for Speed and Medal Of honour are stagnating, Rock Band delivers low margins and the most promising titles on the horizon are Sims 3, Dragon Age, and Harry Potter.
What else should we be tracking? What will be the most commercially successful games of 2009? Let us know your predictions in the comments.
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