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Posted by: Matt Vella on March 12
Ubisoft Entertainment (UBSFF), that other French games giant, has been on a tear lately, riding a mix of well-known franchises such as Tom Clancy and Prince of Persia as well as innovative original titles like the recent Assassin’s Creed to new levels of profitability. Year over year, the company has grown revenues from $841 million to over $1 billion. And unlike competitors – nudge, nudge Electronic Arts (ERTS) – its revenue growth has coincided with a boost to the company’s bottom line, from $18 million to $62 million. In the third quarter alone, sales revenue was up a tidy 44.4%.
Aside from its standard hardcore offerings, the company is targeting casual and youth audiences to support this growth. Notably, the company has achieved a great percentage of its success with games for Nintendo’s (NTDOY) platforms – something other developers have told me privately is difficult given the Japanese company’s own strong lineup of games. In the third quarter, for instance, 28% of Ubisoft’s sales were from DS titles – compared to 12% on Wii, 19% on Sony’s (SNE) PS3, and 19% on Microsoft’s (MSFT) Xbox360. A host of neat DS titles are planned for this spring and early summer. The company is also expecting some 20% of its sales for the year will be “games for everyone,” i.e. not the most hardcore players.
In this week’s Innovation of the Week podcast, I spoke with Laurent Detoc, Ubisoft North America’s president, about how the company’s surging profits have been driven by innovation and cross-genre experimentation embracing casual games and younger audiences. Click here to listen in.
No longer child's play, the booming global games market is worth billions of dollars. In Games, Inc., BusinessWeek Innovation writer Matt Vella and Tokyo correspondent Kenji Hall analyze emerging business trends in video games and interactive entertainment. They’ll examine everything from button-mashing, chart-topping, console games to serious games commissioned by big corporations to train staff. They’ll also map the evolution of expansive virtual worlds and go behind the strategies at companies that are turning play into big business.