The Most Expensive Video Game in History: Activision's "Destiny" Gamble

All sorts of big video-game announcements came out of this month's E3 conference. A company making one of the biggest splashes was Bungie, the studio that created the Halo series that became the Xbox's marquee franchise. The studio separated from Microsoft  (NASDAQ: MSFT  ) in 2007 and produced its last game in the series -- Halo: Reach -- back in 2010. 

Since breaking from Microsoft, the studio signed a 10-year publishing deal with Activision Blizzard  (NASDAQ: ATVI  ) . The first game under this agreement, Destiny, is slated for a September release. Destiny is a hugely important game for a simple reason: It's the most expensive game ever made. Activision's CEO let slip at an investing conference that he believe Destiny will cost $500 million in development costs and marketing. That's more than $200 million more in costs than the next most expensive game, Grand Theft Auto 5. 

Aside from the massive costs sunk into the project, Destiny is a risk because it's creating an ambitious melding of a first-person shooter and role-playing game. Luckily for Activision Blizzard, most reviews of Destiny were largely positive. With Call of Duty appearing to be a franchise that's slipping in popularity, it's important that Destiny could become another marquee bankable franchise for the company. 

In this episode of The Next, Motley Fool tech analyst Eric Bleeker and Rule Breakers analyst Simon Erickson talk about this year's E3, and also some of the disappointment around Microsoft. As expected, there won't be a new Halo game in 2014, which only compounds the Xbox One's early struggles. 

To see their full thoughts, watch the following video. 

Are you ready for this $14.4 trillion revolution?
Have you ever dreamed of traveling back in time and telling your younger self to invest in Apple? Or to load up on Amazon.com at its IPO, and then just keep holding? We haven't mastered time travel, but there is a way to get out ahead of the next big thing. The secret is to find a small-cap "pure play" and then watch as the industry -- and your company -- enjoy those same explosive returns. Our team of equity analysts has identified one stock that's ready for stunning profits with the growth of a $14.4 trillion industry. You can't travel back in time, but you can set up your future. Click here for the whole story in our eye-opening report.

 


Read/Post Comments (4) | Recommend This Article (12)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On June 23, 2014, at 5:06 AM, fr0sty wrote:

    They didn't specify if that $500 million was for just the one game or the entire series. This is Activision we're talking about, known for taking the Call of Duty brand, as soon as Modern Warfare made COD a household name, and whoring it out to 3 different studios to make different games in the same franchise every single year.

    I imagine they plan on milking Destiny much the same. At least Destiny is a good game, after playing the Alpha I'm looking forward to the polished final. I just hope it doesn't get too popular and get ruined when Kotick sees $'s in his eyes. If we end up with a new "Destiny Wars" "Destiny: The Fallen" etc. every year, I'm going to be pissed.

  • Report this Comment On June 23, 2014, at 4:22 PM, chrismireya wrote:

    @ fr0sty: It doesn't matter if this was money spent on an eventual "series" of games. There is no guarantee that DESTINY will even be successful. If it is a bomb, then the money was spent entirely on this game alone.

    It is a major gamble. If the first game fails to sell well, I suspect that Bungie/Activision will still attempt to make a trilogy out of it and hope for the best.

  • Report this Comment On June 23, 2014, at 10:49 PM, awang0718 wrote:

    I'm pretty sure Destiny will sell really well, but I don't imagine it ever coming close to the sales of GTA 5.

    Destiny needs to sell 8.3 million copies to recoup the budget, and 16.7 million copies to break even.

  • Report this Comment On June 24, 2014, at 8:20 AM, Alilwet wrote:

    It will make it's money back for one reason. Activision will use 100 million of it to buy ads on every game critic magazine and website. After that the mags and site will all give it 5/5 and 10/10.

    None of these games are new and innovative. They just take a bit of COD, mash it with a bit of BF, and a bit of Halo, and call it a masterpiece...

    Titanfall was absolute trash. All we heard was how epic it was going to be, ads everywhere... Look at it now... Games like BF4, COD BOII, and Arma III regularly have 100x more viewers on Twitch as it does... Twitch may not be the be all end all of success, but it sure as hell shows you what is popular. TF had a max of 20,000 viewers per day when it was released... To give you an idea, a pro League of Legends player has 20-30,000 viewers a day... That is one person playing a 5 year old game...

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 3003486, ~/Articles/ArticleHandler.aspx, 8/21/2014 8:45:37 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Apple's next smart device (warning, it may shock you

Apple recently recruited a secret-development "dream team" to guarantee its newest smart device was kept hidden from the public for as long as possible. But the secret is out. In fact, ABI Research predicts 485 million of this type of device will be sold per year. But one small company makes Apple's gadget possible. And its stock price has nearly unlimited room to run for early-in-the-know investors. To be one of them, and see Apple's newest smart gizmo, just click here!


Advertisement