Will COD share Guitar Hero's fate?

February 16th, 2011, 01:44 Posted By: wraggster

With over-exposure cited as one of the key factors behind the demise last week of Activision's once mighty Guitar Hero franchise, industry talking heads have now turned their attentions to the publisher's other cash cow – Call of Duty – and asked if it's hurtling towards a similar fate.
The answer? No. Probably.
A number of pundits chimed in on the topic during a lengthy IndustryGamers report, among them Wedbush Morgan's pontificator-in-chief, the irrepressible Michael Pachter. He peered into his crystal ball and saw a relatively bright future for the FPS juggernaut.
"I don't think they are comparable at all," Pach-man insisted.
"Guitar Hero is a franchise that people buy once, because the peripherals are great. As it saturated the installed base, the only buyers were people who are new console purchasers, and the 'fad' appeared to wear off at the same time. Guitar Hero was a victim of its own success.
"Call of Duty, on the other hand, has a vibrant online community that keeps growing. When a new version comes out, the 'network effect' kicks in, and many people buy it because their friends have done so. The risk to the franchise is competition, not people tiring of the gameplay.
"Call of Duty won't fade unless Activision opens the door to competition by making a bad game," he concluded.
Colin Sebastian of Lazard Capital Markets toed a similar line, reinforcing that Call of Duty's future was dependent on the quality of the finished product.
"I think music games were a fad - just like fitness games were at one point, and maybe dance games are today. But after years of franchise growth, I wouldn't put Call of Duty in the same category.
"Could Activision mess it up? Sure, but if they focus on maintaining high game quality, fresh story-lines, and online multiplayer, then I don't see an obvious reason for the franchise to decline."
Mike Hickey of Janco Partners, took a slightly more fatalistic stance, though speculated that Guitar Hero's grisly end was sped up by its status as a flash-in-the-pan social phenomenon.
"All entertainment experiences have life cycles; an accelerated cultural burn will likely extinguish the cycle faster than a gradual iteration philosophy. Ultimately, it's the development studio and collective culture that defines greatness, not Wall Street or the executive teams managing toward a linear path of growth.
Only Billy Pidgeon of M2 Research struck a more cynical note, calling out Activision's lucrative but destructive "strip mining" strategy but adding that the publisher seemed to be getting better at it in recent years.
"Guitar Hero and other former franchises may appear to be publisher failures, but the truth is that strip-mining franchises is a successful, risk-averse strategy. ATVI made good money on GH. Sequels were produced quickly and cheaply.
"The hit it and quit it model - carpet-bombing the market with sequels and then slashing the assets - pays off big in the short term, so ATVI's shareholders are happy. ATVI is learning to execute this strategy with greater efficiency each go-round."
"There is an alternate strategy," he continued, "but it's more risky as it requires careful investment and isn't necessarily as lucrative. Publishers can attempt to keep a franchise going for a longer period of time by spacing out sequels.
"In either scenario, the trick is to keep the franchise selling for as long as possible before it (or the developers) burn out. The endgame is always ugly because layoffs are typically involved."
http://www.eurogamer.net/articles/20...tar-heros-fate

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