Michael Pachter Prediction: Games Sales Down 20 Percent in January

February 10, 2014 - GamePolitics Staff

According to a research note from Wedbush Securities analyst Michael Pachter to investors, game sales dipped 20 percent on the weakness of current generation sales in the month of January. Pachter is making his predictions ahead of the NPD Groups' retail report for the month of January. When those numbers are released on Thursday, Pachter says that they will show that retail software sales fell 20 percent in January to around $300 million - down 20 percent from the $373 million generated in the same period a year ago.

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Michael Pachter: Price Cuts in February for Xbox 360, PS3

January 21, 2014 - GamePolitics Staff

In the latest edition of Bonus Round, Wedbush Morgan analyst Michael Pachter says that Sony and Microsoft will likely slash the price of their last generation consoles in February. Pachter went on to claim that publishers have threatened to stop supporting the last generation consoles if platform holders didn't start cutting the price of their systems.

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Michael Pachter Takes a Shot at Nintendo President Satoru Iwata

December 6, 2013 - GamePolitics Staff

Speaking at the Game Monetization USA Summit in San Francisco this week, Wedbush Morgan analyst Michael Pachter said that Nintendo president Satoru Iwata should be fired for his handling of the Wii U and the company in general.

"I don't know why Iwata is still employed," Pachter said during his presentation, according to a GamesIndustry International report, adding that the Wii U’s commercial performance has been "underwhelming” and that he believed it was “possible but unlikely” that new titles could help the system to recover.

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Pachter: Sony Shipping One Million Units Per Month, Half Going to GameStop

December 3, 2013 - GamePolitics Staff

Wedbush analyst Michael Pachter estimates that Sony, who has promised "substantial resupplies" of the PlayStation 4 consoles in North America before the end of 2013, is making one million units per month. Pachter says that Sony is shipping about one million units to North America per month, with about half of those units going to retailer GameStop.

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Pachter: Microsoft Prepared to Lower Price on Xbox One

June 20, 2013 -

According to Wedbush analyst Michael Pachter, Microsoft could cut the price of the Xbox One a year or so after launch. Pachter thinks that the Xbox One bundle offers more value because it includes the new Kinect - even if it is $100 more than the PlayStation 4.

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Michael Pachter: Publishers Won't Block Used Xbox One Games

June 7, 2013 -

Wedbush Securities analyst Michael Pachter does not believe that third-party Xbox One game publishers will disable used games using the system Microsoft has put in place to do just that on its next-generation platform. Pachter goes so far as to say that any publisher that disables used games runs a serious risk of significant backlash or boycotts from consumers. In a note to investors today, Pachter said the majority of publishers will not block used games in the system's first few years.

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Pachter: Not Even a Price Cut can Help Wii U Sell Units

April 15, 2013 -

Wedbush Securities analyst Michael Pachter said in a preview note sent out to investors late last week that not even a price cut to Nintendo's Wii U will help it sell more units. He also predicts that Nintendo will report another month of weak sales for the console later this week.

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Analyst Michael Pachter Blames December Sales Declines on Nintendo, Franchise Fatigue

January 7, 2013 -

Speaking to GamesIndustry International, Wedbush Securities analyst Michael Pachter says that Nintendo's continued weakness contributed to 11 percent of the decline in U.S. video game sector in the month of December. Pachter also said that there was evidence that consumer fatigue has set in - even when it comes to popular games like Call of Duty: Black Ops II.

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Michael Pachter: Activision Should Charge a Fee for Call of Duty Multiplayer

December 7, 2012 -

This is sure to put analyst Michael Pachter on someone's naughty list: Recently he said that Activision needs to start charging a fee for the multiplayer portion of its Call of Duty games. Wedbush Securities industry analyst Michael Pachter made his comments during the Digital Game Monetization Summit in San Francisco, California (as reported by GamesIndustry International). During his presentation he said that Activision made a serious mistake when it didn't implement a subscription-based model for Call of Duty multiplayer.

Pachter: Big IP Mistakes Could Impact October Sales

November 5, 2012 -

Wedbush Morgan analyst Michael Pachter says that Electronic Arts and Activision's mismanagement of big first-person shooter titles could end up contributing to another month of "terrible" software sales for the game industry in October. He is referring to Medal of Honor: Warfighter, a game that was supposed to be a major release for EA in October and Activision's 007 Legends, which fared worse than Medal of Honor.

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Pachter: Vivendi Probably Won't Sell Activision Blizzard

July 3, 2012 -

Wedbush Morgan Securities analyst Michael Pachter has said in a note to investors (PDF) that it is unlikely that Vivendi would sell off Activision Blizzard.

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Pachter: Xbox 720 in Spring 2014

June 22, 2012 -

Wedbush Morgan analyst Michael Pachter expects that Microsoft’s next-generation "Xbox 720" console will be released in the Spring of 2014, adding that he expects the new console to function much like a set top box. Anyone that has followed Microsoft in the last ten years knows that the company has been working on a set top box strategy for a very long time - even before it considered making a video game console.

Pachter adds that he does not believe the speculation on a late 2013 release.

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Pachter: To Be Successful, Wii U Should Not Exceed $300

June 11, 2012 -

Wedbush Morgan analyst Michael Pachter says that Nintendo has to price its new Wii U console at around $300 per unit to stand a chance of being successful at retail.

Pachter tells C&VG that he remained uncertain after Nintendo's E3 press event whether it has a "killer app" to help drive sales of the new console.

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Michael Pachter: Sony and Microsoft Waiting on Wii U Pricing

June 7, 2012 -

Wedbush Morgan analyst Michael Pachter believes that Microsoft and Sony may very well cut the price of their respective consoles at some point but are waiting to see what the retail price of the Wii U will be so they can respond accordingly.

"I think both Microsoft and Sony are waiting to see Wii U pricing. If it is over $300, they don't need to cut." Pachter tells C&VG.

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Michael Pachter Talks On-Disc DLC

May 29, 2012 -

According to Wedbush Morgan analyst Michael Pachter unlocking downloadable content that is already present on a retail game disc when you by it might not be illegal. On the latest edition of his GameTrailers TV show " Pach Attack," Pachter also says that it shows the greediness of developers and publishers in some ways.

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Michael Pachter: Amalur IP Worth $20 Million

May 23, 2012 -

If 38 Studios is forced to sell the IP related to Kingdoms of Amalur: Reckoning and the MMO Project Copernicus (set in the same universe), one wonders how much both properties would be worth. Joystiq decided to ask Wedbush Morgan analyst Michael Pachter for a valuation and he came to the conclusion that 38 Studios' IP is worth about $20 million.

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THQ Predicts Lower Sales for Q3, Blames uDraw

December 8, 2011 -

THQ expected that bringing its popular Wii drawing peripheral, uDraw, to other platforms would be lucrative. Earlier this year they announced that the uDraw would be coming to the Xbox 360 and PS3. With the peripheral out and in stores, it looks like THQ isn't getting the kind of returns they expected. The company said yesterday that sales for the third quarter would be down around 25 percent and blames weak sales of the drawing peripheral for the Xbox 360 and the PlayStation 3.

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Pachter: Modern Warfare 3 Will Generate $1.1 Billion in First Six Weeks of Release

November 4, 2011 -

According to Wedbush Morgan analyst Michael Pachter, Activision's Modern Warfare 3 will sell ten percent more copies than Call of Duty Black Ops. He estimates that the game will rake in $1.1 billion in its first six weeks on store shelves. Pachter also predicts that the Call of Duty Elite premium service could pull in up to 4 million subscribers by the end of the year. Of course, he probably didn't know at the time that it wouldn't be available for PC users. That may throw a wrench into the gears of his calculation machine.

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Pachter: Modern Warfare 3, Battlefield to Generate $1.4 billion in Q4

October 24, 2011 -

Wedbush Securities analyst Michael Pachter loves to make predictions, and when he does, he goes big. Two of the biggest games this year - Modern Warfare 3 and Battlefield 3 - are set to launch in North America and Pachter has a big number that he believes both games will hit. Pachter believes that Modern Warfare 3 and Battlefield 3 will generate more than $1.4 billion combined by the end of the year.

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Should Game Developers Have A Union?

July 26, 2011 -

In light of the accusations of horrible working conditions that L.A. Noire developer Team Bondi has garnered of late (excessive hours, no overtime pay, employees cut out of the game’s credits), do game developers need labor rights?  Should they have a union?

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Pachter: Surprising LA Noire Sales Offset by Bad Duke Nukem Forever Sales

July 6, 2011 -

While LA Noire has proven to be a decent tile for Take-Two, Wedbush analyst Michael Pachter says that the poor showing of Duke Nukem Forever has eaten away at those profits. In a note to investors today, Wedbush analyst Michael Pachter lowered his expectation for Take-Two's quarterly revenues, saying that bad performance from Gearbox Studios' Duke Nukem Forever have offset the stronger-than-expected sales of Rockstar's L.A. Noire.

"We had previously expected Duke to be one of the year's top sellers due to a high degree of hype and a dedicated fan base, and expected solid profit contribution as the bulk of development had been previously expensed," Pachter told investors. "However, the game's poor reviews (average Metacritic score of 49) likely had a negative impact on sales, causing us to lower our [first quarter] sell-in estimate to 1.5 million units from 3 million units."

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Analysts Talk: The Worst of 2010

December 21, 2010 -

In a Gamasutra feature article called "The Year In Review: Game Biz Analysts On The Worst Happenings Of 2010" analysts from various firms sound off about the worst moments in the game biz during 2010. Below is a small sampling of what analysts had to say.

According to Wedbush Securities analyst Michael Pachter, the worst thing to happen in the industry in the year is video games going before the Supreme Court:

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Left Behind Games and the Pachter Effect

November 17, 2010 -

Christian video game publisher Left Behind Games has increased guidance upwards by 30 percent for its fiscal year ending March 31, 2011. LBG expects $1.3 million in annual revenue as a result of significant interest in our products - according to CEO Troy Lyndon.

The company also gave credit to Wedbush Morgan analyst Michael Pachter for some of that newfound interest in its products:

"On February 24, 2010, Michael Pachter, Research Analyst at Wedbush Securities stated, 'I think that the Christian video game market is a significant market currently underserved by traditional publishers.' Since the time of Pachter’s quote, LB Games has grown in revenues by more than 1000 percent and gained national retail distribution through Synnex, a billion dollar funding, fulfillment and distribution partner introduced to LB Games by Walmart. LB Games products are also available online at Walmart.com and BestBuy.com."

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Michael Pachter: 'I Use The Press'

November 16, 2010 -

Journalist Tracey John and analyst Michael Pachter guest star in The Escapist feature, The Crystal Ball of Michael Pachter. No matter what you think of the outspoken Wedbush Morgan video game analyst, this interview / feature from Tracey John sheds some light on what Pachter does on any given weekday and how he manipulates the media to promote himself.

Here is the part where he shows his humility and admits that he uses the press:

"Investors should [listen to me] because I'm really good, but look, I use the press," he admitted when I asked why we should listen to him. "It's a symbiotic relationship. I try to give you guys what you need, and I use the press to promote myself so that more investors want to talk to me. That helps me get paid more money."

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Pachter: So Far, GameStop Not Impacted By Online Pass

August 20, 2010 -

Michael Pachter, gaming research analyst for Wedbush Morgan Securities, says that schemes to recoup cash from used game buyers doesn't seem to be having an impact on sales at GameStop. In a post-financials report on the retailer, Pachter said that the country's largest games retailer remained unscathed in its latest quarter and that aggressive code-based schemes for used games weren't hurting the retailer’s bottom line. This could be because most of these schemes from EA and THQ (in a small measure) are targeting multiplayer, which GameStop says only 25 percent of used game buyers are interested in.

"The company has not seen a negative impact on used software sales from first-use codes or new competitors in the space," Pachter said. "The company estimates that only 25 per cent of used game buyers play online.”

Naturally EA and THQ have just barely rolled out such schemes on a couple of titles. We'll see how it affects used games sales of titles like the latest Madden game in the next quarter. Pachter also shared his pessimism on GameStop’s plan to create a digital market space to sell DLC.

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Wedbush: Industry Rebound Possible on New Hardware

June 21, 2010 -

Wedbush analysts Michael Pachter and Edward Woo, who no longer think that the video game industry is "recession proof" (remember that?) are now saying that the new hardware introduced during E3 last week in Los Angeles has the potential to reinvigorate the sector. The major hurdle, they say, is pricing. The Wedbush duo were apparently most impressed with the Nintendo 3DS, which provides gamers (not under the age of 7, says Nintendo, because 3D is the devil to your eyes at that tender age) with 3D gaming and entertainment without the need for goofy 3D glasses. The 3DS is rumored to have a price point of $250 or more, but the pair do not believe it will matter, saying that Nintendo will sell millions of units.

Microsoft's Kinect, on the other hand, will have to be priced reasonably to sell, they believe:

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Pachter: Best Buy's New Games at Used Prices Experiment Destined to Fail

August 10, 2009 -

Brand-new games at used game prices?

A pilot program that does just that is being tested at a Best Buy location in Utah. While it sounds like a good deal for consumers, Wedbush-Morgan analyst Michael Pachter doesn't expect to see the Best Buy experiment gain traction on a large scale.

Of the program, under which Best Buy will match used game prices in effect at either GameStop or Game Crazy, Pachter said:

I don’t think it will do well.  The price match means that Best Buy either cuts their profit per game in half, or wipes it out altogether.  I don’t think that they can afford to sell $60 games for $50, and don’t think that it will be effective in the long run.  If it does well, then GameStop will cut used game prices to the point where Best Buy can’t match without losing money.

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Pachter: Economist's Claims in Madden Monopoly Case Irresponsible

July 15, 2009 -

Yesterday's GamePolitics report detailing a University of Michigan economist's estimate that EA's exclusive NFL deal cost Madden buyers as much as $926 million raised a number of eyebrows, including those attached to the forehead of Michael Pachter (left).

In an e-mail exchange with GamePolitics, the Wedbush-Morgan analyst scoffed at the monopoly theory offered by Dr. Jeffrey MacKie-Mason in a filing last week with the U.S. District Court in San Francisco. MacKie-Mason was hired as an expert witness for the plaintiffs in a class-action suit filed in 2008 by a pair of gamers who allege that EA exploited its exclusive NFL deal to jack up the price of its popular Madden series.

Here's what Pachter had to say:

What kind of fool is this U of Michigan economics professor? ...Madden (according to NPD) sold 23 million units in 2006 - 2009, not the 30 million that Dr. MacKie-Mason claims... The total retail sales were $1.034 billion, meaning that EA's cut was around $800 million (retail margin is 20%).  How in the world does [MacKie-Mason] conclude that EA overcharged by more than they generated?

For the four year period, EA's average retail price was $44. For the period 1995 - 2005 (when either Sega or Take-Two provided [NFL 2K series] competition), EA generated $1.548 billion of sales on 36 million units, for an average price of $43. In other words, WITH competition, the price was $43, and WITHOUT competition, the price was $44.18...

I rarely read anything that gets me so incensed... They may have some odd estimates I'm not aware of, but based on what you printed, they should be embarrassed. You can quote me.

Here's more: Take-Two discounted [NFL 2K5] to $19.99 to gain market share, and lost their butts in the process. It's the same as a dollar menu at McDonald's that is a loss leader in order to gain share, and McDonald's hopes people buy the high-margin soft drink. There is no "right" among consumers to receive a perpetual discount just because one retailer decides to discount below cost... 

It strikes me as irresponsible that the professor would focus on the NFL exclusive as if there is some god-given right for consumers to have all intellectual property available for exploitation by any business that chooses to do so in the name of competition... 

The ONLY I/P that has ever been licensed to multiple video game parties is team sports.  The NFL, Major League Baseball, FIFA, and NCAA Basketball have all chosen to go the exclusive route for games, similar to the contracts for all movie-based games.

GP: As GamePolitics reported yesterday, MacKie-Mason acknowledges that his analysis is based on incomplete data. In a response filing, attorneys for EA (who were similarly contemptuous of MacKie-Mason's theory) agreed to furnish available documentation dating back to 2001.

Pachter: 100,000,000 Used Games Traded Yearly in U.S. ...New Game Sales Helped, Not Hurt

June 30, 2009 -

A new report by Wedbush-Morgan analyst Michael Pachter should put paid to game industry whining about used game trades. Although, somehow, we doubt that will happen.

According to gamesindustry.biz, Pachter found that up to 100 million (!) used video games are traded each year in the United States. That figures accounts for a remarkable third of all game sales.

But Pachter also reports that the used game trade has a positive impact on new game sales, not the negative impact so often claimed by a variety of game industry types. The outspoken Pachter comments:

The vast majority of used games are not traded in until the original new game purchaser has finished playing - more than two months after a new game is released - typically well beyond the window for a full retail priced new game sale.

If trade-ins occur at GameStop, they should position the trade-in customer to buy more new games than he/she would otherwise normally purchase. Because the average used game value is around 20 per cent of the new game price, we think that used game trade-ins fuel incremental sales of over six per cent of total new game sales, suggesting that the cannibalisation from the used game 'push' is more than offset by the benefit from used game currency.

22 comments

Pachter Backs Off PSP Go "Rip Off" Comments... We Don't

June 12, 2009 -

Wedbush-Morgan analyst Michael Pachter has publicly apologized for saying that Sony was "ripping off the consumer" by setting a $249 price point on the PSP Go. The eminently quotable Pachter made the damning comment about the new handheld last week during an E3 segment of Bonus Round.

Apparently thinking better of his words in the interim, Pachter penned an apology yesterday as he debuted a new monthly column for IndustryGamers:

I sincerely regret the choice of words... where I said that Sony is "ripping off" the consumer by pricing the PSP Go at $249.99. I made a poor choice of words, and I do NOT think that Sony is doing anything nefarious in choosing their pricing strategy.

 

The company has the right to price its products at a point that they think is competitive, and has no obligation to sell products at lower than a competitive price. They have been subsidizing purchases of the PS3 since launch, to the tune of 22 million sold at a loss of $100 or more apiece (on average), so if they are able to make a profit on the PSP Go, more power to them. They are pricing at a point that positions the PSP Go competitively with the iPod Touch, and the PSP Go arguably has much more value than the Apple product. Notwithstanding my view that the price point is too high to generate more than a few million units sold, I really think my comment was unfair, and would appreciate your allowing me to clear the air...

GP: Pachter is a straight shooter and, apology notwithstanding, I believe he was speaking from the heart when he made his original comment. It's not too much of a stretch to imagine that there were a few angry phone calls from Sony HQ to Pachter between the airing of the "rip off" remark and yesterday's mea culpa.

But the fact is, Pachter got it right. Why does the PSP Go, which does away with the UMD drive assembly, cost $80 more than the current PSP-3000? There's no good reason, and gamers knew that even before Pachter spoke out. From the moment it was announced at E3, the PSP Go's $249 price point went over like the proverbial lead balloon.

Nor do I think much of the PS3 justification floated by Pachter in his retraction. Sony is losing money on the PS3, certainly, but that's no excuse to try to make a few million back by skinning consumers with the PSP Go. Personally, I love my PS3. But if Sony overdid the hardware, over-estimated their market and totally screwed up the worldwide launch, that's on them.

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Sleaker@CraigR been using Win8.1 for a while, I don't really see any usability difference between it and 7 (Work uses 7)10/01/2014 - 2:16am
Craig R.Ok, my internal debate was short-lived. If Win10 is still a year out, I'm not waiting that long for an SSD, so on Win7 I will remain.09/30/2014 - 7:52pm
Matthew Wilsonits called windows 10, and I am happy to get the start menu back.09/30/2014 - 7:18pm
Jessy HartIs this stuff about Windows 10 legit? Is it actually called Windows 10 or is it just some stupid joke?09/30/2014 - 6:57pm
ZippyDSMleeSo I been trying to play Bioshock Infinite I got all the DLC,ect but do not want the extras to make your charatcer over powered from the start.....they force you to take them which is quite annoying......09/30/2014 - 6:45pm
Craig R.I need to upgrade to an SSD, still seriously debating moving to Win8.1 from 7 at the same time09/30/2014 - 6:07pm
Craig R.Win10 is probably Win8.1 with more cleanup and the Start button back.09/30/2014 - 6:06pm
Sora-ChanAhh, it's just weird seeing someone's post all of a sudden have replies from days prior before it was posted due to that.09/30/2014 - 5:49pm
MechaTama31sora: I broke the ordering intentionally, as AE's and my conversation had squeezed the text boxes down to be quite slim. I replied to an earlier post of his instead of the one I was actually replying to.09/30/2014 - 5:46pm
MechaTama31So, 9 would have been the good one, but they are skipping it to do two crap ones in a row?09/30/2014 - 5:41pm
Sora-ChanSo, judging from the poll post for #gamergate, it looks like too many thread replies breaks the ordering of posts, as seen with the recent post from Infophile.09/30/2014 - 5:31pm
Andrew EisenOr no! It wasn't Y3K compliant. Microsoft thought it best to super future proof its OS and skipped straight to 10 which is Y3K compliant!09/30/2014 - 5:01pm
Andrew EisenJust tell them it wasn't Y2K compliant.09/30/2014 - 5:00pm
Craig R.Looking forward to having to explain to coworkers down the road what ever happened to 9 *sigh*09/30/2014 - 4:57pm
Craig R.2k was crap. XP was solid, 7 is good, 8.1 is actually really good once you make it look like 7 :)09/30/2014 - 4:52pm
Sora-Chan@MP As someone who has used each version of windows since 3.1... I prefer Vista over 7 for various reasons. The only thing I give 7 over Vista is preformance. They really screwed up a bunch of things when making 7. Also, XP was a pain. 2k was better.09/30/2014 - 4:13pm
Jessy Hart@E. Zachary Knight Is that show called Pac-Man and the Ghostly Adventures?09/30/2014 - 3:34pm
IanCWin 8 isn't bad, it just can't decide whether to be a desktop OS or a tablet OS.09/30/2014 - 2:40pm
IanCI think its a way of getting round giving it free to Win 8 users...09/30/2014 - 2:39pm
MaskedPixelanteWindows alternates between bad and good versions. XP was good, Vista sucked, 7 was good, 8 sucked, therefore 10 will suck, QED.09/30/2014 - 2:18pm
 

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