While Activision proudly announced that Black Ops 2 managed to hit $500 million in its first 24 hours of release, Call of Duty's time in the sun might soon be coming to an end.
According to Sterne Agee analyst Arvind Bhatia, not only is the franchise's sales tracking down double digits year-over-year, their initial checks at some retailers even show that sales are down 20% compared to previous entries in the series.
We believe unit sales of Call of Duty: Black Ops II are tracking down double digits year-over-year. Our checks show initial sales of CoD: Black Ops II at some retailers were down as much as 20 percent. Subsequently, it appears sales of CoD did pick up a bit over the Thanksgiving holiday. We think the current sales curve suggests CoD: Black Ops II unit sales in its first year could ultimately be down 10 percent to 15 percent year-over-year.
Bhatia adds that if they're correct, then this marks the second-year in a row Activision's biggest moneymaker has seen its units sales decline. Comparatively, Modern Warfare 3 sales are down estimated 5% compared to that of the first Black Ops. It's estimated that the Call of Duty games generate 40-45% of the company's EBIT (Earnings Before Interest and Taxes) on a yearly basis and any weakness from the franchise's sales is a cause for concern for the world's largest videogame publisher.
So, what could have caused this signifcant downturn when it comes to Black Ops 2's sales? Bhatia notes that there are three factors they're considering now:
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We (they) note that (review) ratings for Black Ops II on average were slightly lower than Modern Warfare 3, which may have impacted initial sell-through.
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Black Ops II launched only a week after Halo 4, which could have impacted its sales.
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Black Ops II launched only a week before Thanksgiving, which may have caused some consumers to delay purchases in anticipation of potential deals/discounts.
There's also a fourth reason Bhatia failed to mention and that could very well be franchise fatigue. It's already happened to Activision's past premiere brands such as Tony Hawk and even the Guitar Hero franchise. So, there is a chance that some people are getting tired of Call of Duty. Another reason could be is that since this is the tail-end of this current-generation of consoles, more and more people might be tempted to not get every game coming out and instead wait for their next-gen versions to buy those instead.
While Call of Duty is still the king when it comes to the FPS crown, there should be a cause for concern from Activision about this. Notably, since its closet competitor, which is EA's Battlefield 3, has already managed to ship over 17 million units to date — a figure, that unless I'm mistaken, is the highest-ever for an FPS game that's not named Call of Duty. With Battlefield 4 slated to ship next year and EA still having another bullet in use in former Infinity Ward co-founders' Jason West and Vince Zampella's game at Respawn, 2013's battle for the FPS crown might be one of the most memorable in recent years.
Do you think the Call of Duty franchise has peaked or is it just due to Halo 4? Also, which game franchise do you think has a shot at finally unseating the current king? Sound off and let us know.
Thanks, GamesIndustry
