Posts Tagged ‘Kinect’

Microsoft brings home record Q3 results, driven by Xbox and Kinect sales

Friday, April 29th, 2011

Redmond, Washington based software giant Microsoft has recently released their Q3 (ending March 31, 2011) results, reporting a new company record, as the firm brought home $16.43 billion in revenues. Of this massive number, $5.23 billion is counted towards net income, much higher than analysts’ projections, much to the delight of investors, which saw a valuation of $0.61/share. This revenue number may signal a wind of change at Microsoft, as figures are up a healthy 31 percent year-over-year.

Microsoft’s Business Division fared well YOY, with a decent growth of 21 percent, and points to Office 2010 as the fastest selling version of the popular office suite across the product’s lifetime.

Hardware products including Servers and their associated tools saw an 11 percent growth, the division’s fourth consecutive double-digit growth quarter. Microsoft points to a strong enterprise adoption rate of Windows Server 2008 R2, SQL Server 2008 R2, and System Center is primary drivers of this growth. Likewise, Microsoft reports that Windows 7 has now officially become the hottest selling OS in the company’s history, with over 350 million licenses sold. Despite these impressive numbers, overall revenue was down by 4 percent in Q3, which Microsoft attributes to decreased PC sales.

“We delivered strong third quarter revenue from our business customers, driven by outstanding performance from Windows Server, SQL database, SharePoint, Exchange, Lync and increasingly our cloud services,” said Kevin Turner, chief operating officer at Microsoft in a statement. “Office had another huge quarter, again exceeding everyone’s expectations, and the addition of Office 365 will make our cloud productivity solutions even more compelling. We continue to see strong adoption of our cloud-based services among the Fortune 500.”

And while all the business-focused divisions are (for the most part) reporting increases, it’s not until you look at Microsoft’s Entertainment and Devices category, where these numbers pale in comparison. This division alone is clearly the driving force behind the record numbers, reporting a whopping 60 percent year-over-year growth. And the primary driver with this division? It should come as no surprise that Microsoft’s motion sensing Kinect for Xbox, which became the fastest selling consumer electronics device in history, is also driving Xbox sales, resulting in happy days in Redmond.

“We delivered strong financial results despite a mixed PC environment, which demonstrates the strength and breadth of our businesses,” said Peter Klein, chief financial officer at Microsof in a statement. “Consumers are purchasing Office 2010, Xbox and Kinect at tremendous rates, and businesses of all sizes are purchasing Microsoft platforms and applications.”

Microsoft was reluctant to speak about it’s Windows Phone 7 platform, only mentioning on an earning call that “product reviews are good,” and that, “customer satisfaction is high.” With the growing prominence of mobile, and thus tablet, based user-consumption, can Microsoft now repeat the Xbox process, and get into the wireless game before it’s too late?

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Kinect to edge out Move in 2011 sales, 3D not so hot, and no love for OnLive and Gaikai

Wednesday, December 29th, 2010

Predicting hardware sales is a tricky business. Amongst the umpteen figures to consider, user preference is one of the hardest to call. However, UK based firm Screen Digest has planted their flag in the sand, stating that Microsoft’s motion based controller, Kinect will slightly outsell Sony’s answer, the Move by 7.6 million units to 7.3 million units, respectively.

According to GameSpot, Screen Digest’s predictions do not include 2010 sales figures. Normally, this would be a figure to throw by the wayside…if the two products were launched simultaneously, but you’ll remember that Move was out months before Kinect. It’s also noteworth, as Microsoft announced in November that it has moved 2.5 million Kinect units, and was well on pace to deliver 5 million by the end of this year.

Given these numbers, and Microsoft’s statements and additional numbers, moving 2.5 million units per month in the holiday buildup seems completely reasonable. Post holiday shopping will naturally see a decline, so let’s slim this number down to around half a million units per month. Even at this growth rate, Screen Digest’s numbers are a tad low. Meaning – although Screen Digest is lying on the conservative side of the numbers, it’s very likely that we could see Kinect push over 10 million sales in 2011.

Note: Piers hardin-Rolls from Screen Digest commented at Gamasutra clarifying the numbers:

“Our [data] actually refers to new Move and Kinect enabled consoles added during 2011, not installed base, which we forecast to be 11.7 million for Move and 12.1 million for Kinect by end of 2011.”

Adding: “Please note that the Move numbers refer to Move-enabled consoles and not total Move peripheral sales (as a % are bought for multiplayer gaming on single consoles).”

And while Sony may have answered the Nintendo Wii with it’s own motion based control, it’s a case of too-little-too-late. While Sony spent time developing at system that amounts to nothing more than a Wii in HD, Microsoft developed an entirely new product and input method. Coupled with Move software’s dreadful sales, it appears as though Sony has delivered the golden egg.

Screen Digest also noted a few other Sony shortcomings when it comes to all-things-digital. The much hyped and anticipated arrival of 3D televisions has been less than overwhelming, with the firm saying that 3D TV sales will fall flat in 2011. They state that broadcasters are putting too much focus on sporting events and non-recurring programming for consumers to find value in said television.

Also of note: Screen Digest wasn’t any friendlier when it came to streaming gaming services, aka OnLive and Gaikai. The postulate that neither device offer a compelling experience, ultimately providing a poor value proposition.

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Microsoft moves 2.5M Kinect thus far; Nintendo, 1.5M gaming systems in a week

Tuesday, November 30th, 2010

If there is a recession going on, please do not tell the American consumers. Based on recent reports, even if times are tough, and money is tight, pixel hungry consumers are out in force.

Microsoft Kinect

Microsoft recently announced that the traditional shopping nightmare day of Black Friday has propelled sales of the motion sensing Kinect over the 2.5 million mark. This represents a global total sales figure, and has been accomplished in only 25 days. And with some quick cocktail napkin math, that breaks down to 100,000 units sold/day.

“We are thrilled about the consumer response to Kinect, and are working hard with our retail and manufacturing partners to expedite production and shipments of Kinect to restock shelves as fast as possible to keep up with demand,” said Don Mattrick, president of the Interactive Entertainment Business at Microsoft. “With sales already exceeding two and a half million units in just 25 days, we are on pace to reach our forecast of 5 million units sold to consumers this holiday.”

5 million units in just 2 months? Impressive numbers for sure Microsoft. To you, I can only say; Hats off. Available in more than 38 countries around the world, and 60,000 retailers, Kinect is Microsoft’s answer to the once-top-of-the-charts Nintendo Wii motion sensing controller. With Kinect, not only can you control games, but also interact with movies, music, and television, and the Kinect system also responds to voice commands.

“Kinect on Xbox 360 was a top performer at Target this weekend,” said Nik Nayar, vice president, merchandising, Target. “We expect Kinect will be a must-have gift this holiday season, so Target will continue to receive consistent shipments of Kinect throughout December. The hands-free, active gaming experience that Kinect offers is something that everyone in the family can enjoy.”

Nintendo

And while Microsoft might be on target to sell 5 Million units before the holiday season comes to an end, Nintendo also received the Black Friday bump, with Redmond reporting that consumers took home a combined $1.5 million worth of Nintendo gear over the course of Black Friday week, November 21st – 27th. Nintendo’s Black Friday sales numbers clocked in at a very healthy 900,000 units of the Nintendo DS line moving off the shelf, and with 600,000 Wii consoles destined for holiday happiness. This numbers do not reflect actual sales numbers, but are derived from Nintendo’s own internal sales estimates.

When viewed in the same Don Draper-esque math, Nintendo moved 9,000 units per hour over the Black Friday Week.

“For the past several years, consumers have decided that Nintendo defined both top value and all-inclusive entertainment, and that sentiment continues again at the start of this shopping season,” comments Nintendo of America President Reggie Fils-Aime.

Nintendo points to it’s attractive new hardware color offerings, as well as popular game/hardware bundles as primary drivers for the sales numbers. Bundles include a limited edition Mario red Wii and DSiXL, as well as orange and green DSi systems, all of which feature one iteration or another of the now 25 year old Mario franchise.

Of the past few years, we’ve predicted that the video game industry may be recession proof, and while sales numbers and associated costs have remained relatively consistent with all other forms of entertainment around them, it’s very clear that consumers are finding significant value in video game entertainment. To put a number on that value? Well … it’s somewhere around 5 million for Microsoft and Kinect, and certainly, Nintendo has nothing to complain about with 1.5 million units moved in a week.

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Microsoft lines up top advertisers for Kinect launch

Tuesday, September 28th, 2010

Announced at this week’s Advertising Week 2010, Microsoft has lined up key advertisers for the upcoming November 4th launch of their new motion control system for Xbox 360.

microsoft_kinect_31-540x337

As Microsoft hopes to usher in a new way of play, advertisers are already showing interest in how their ads can be interacted with. Taking advantage of Kinect’s unique response to body movements, Chevrolet, Sprint, and T-Mobile USA will launch respective ad campaigns across the Kinect console network, “Kinect Joy Ride,” “Kinect Adventures,” and “Kinect Sports.”

All ad campaigns are slated for a November 4th launch; let’s take a deeper look:

  • Chevrolet. This was the first campaign that was announced for Kinect, back in June, and places auto maker Chevrolet in a prime position to allow customers the opportunity to test drive Chevrolet vehicles from the comfort of their own home. The title will open with users driving Chevy’s new Volt car, but users can unlock additional cars such as the Cruze, Camaro, and legendary Corvette by watching video advertisements either on Xbox LIVE or the Web. An additional campaign is slated for the first of the year where Chevrolet will feature the same vehicles in the Kinect Hub.
  • Sprint. US telecom provider Sprint will launch “Kinect Adventures,” with a matching retail experience features on Xbox LIVE, as well as a “Kinect Adventures,” contest whereby players will have the opportunity to have their pictures features on Xbox LIVE. Those attending the NY Comic Con (October 8-10) will have a first crack at “Kinect Advetures,” as the campaign will be live at the Sprint booth suring the convention.
  • T-Mobile. Focused on sports, T-Mobile enters the Kinect ring with fixed product placements throughout the motion based games including volleyball net logo placements, custom bowling balls, and foam fingers in the virtual stands. In addition to the product placement, T-Mobile is going the extra mile and sponsoring a contest whereby players can view video content and partake in the first launch weekend “Play and Win” contest with prizes including Family Gold memberships (a $99.99 retail value).

“With Kinect for Xbox 360, we are removing the last barrier to interactive television — the controller,” said Mark Kroese, general manager of the Interactive Entertainment Advertising Business Group at Microsoft. “We have seen tremendous momentum from the advertising community, including big campaigns from Chevrolet, Sprint and T-Mobile. These visionary marketers are leading the entertainment revolution with ground-breaking campaigns that are highly engaging.”

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Chevrolet partners with Microsoft for virtual Volt test drive via Kinect

Wednesday, June 23rd, 2010

Announced at the 2010 Cannes Lions International Advertising Festival, Microsoft and Chevrolet have partnered to bring the worlds first mutliscreen advertising campaign that takes advantage of the upcoming Kinetic’s controllerless gaming interface. The project will promote Chevy’s Volt electric car launch later this year. From a gamers view, Kinect offers an entirely new way of interacting with video game titles, whereas from an Advertisers view Kinect offers a unique way of connecting with consumers by allowing them to virtually physically interact with a product.

chevy_voltThe Volt IGA will take place within “Kinetic Joy Ride,” Microsoft’s first sans controller racing title. After gamers view the video ad in-dash on Xbox LIVE or the Web, the Volt will be unlocked and available for a test drive.

“The Volt applies advanced environmental technology to give Chevrolet drivers freedom from the gas pump, making it one of the most exciting developments the automotive industry has seen in years,” said Jim Campbell, U.S. vice president, Chevrolet Marketing. “Our marketing campaign needs to reflect this. Kinect allows us to bring the excitement of the showroom to the living rooms of our customers. It’s a way for us to replicate the experience of physically engaging with a product that is essential to the customer’s purchasing decision.”

And while Kinect has been touted for it’s innovation and “never seen that before” technology and interaction capabilities, this campaign illustrates a number of revenue generating possibilities for Microsoft and advertisers. Not only can consumers take a product for a virtual test drive, but advertisers can extend a campaigns reach via Microsoft’s various resources. For example, an extension of the Volt campaign under consideration involves a mobile brand experience. Consumers can add a local Chevrolet promotion to their calendar to take the Volt for a real-world test drive, or use Bing’s voice search to locate a dealer near them.

“Chevrolet Volt is not only offering a new way for car buyers to interact with and learn about a vehicle before heading to the dealership,” said Darren Huston, corporate vice president of the Global Consumer & Online group at Microsoft. “It’s enabling people to virtually test drive the Volt from the comfort of their own living room. This campaign showcases the kind of breakthrough digital campaigns we can deliver for marketers when we combine great partnerships with leading-edge software innovation.”

Given what the Chevrolet Volt is and what it stands for, I couldn’t think of a more fitting partner to test the multimedia crossover advertising waters. Technology of what type meets technology of another. The ultimate question is, after the novelty of Kinect wears off, will we be back to the same old argument about IGA, or has Microsoft established a compelling enough experience to make it last the duration?

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Microsoft Kinects with users

Monday, June 14th, 2010

Microsoft has finally let the beans spill about the highly anticipated, and extremely well received Project Natal; now known as Kinect.

kinectPrior to the opening of industry event E3 in Los Angeles this week, Microsoft put on a pretty impressive show, Cirque du Soleil included, at the University of California’s Galen Center. Highlights of the show included video clips of Kinect in action starting with athletic sims. The videos showed participants running and jumping to complete a hurdles sim, others throwing a virtual javelin. Other sports based games included soccer, white water rafting, while still others offered up yoga and dancing games.

Microsoft is reported to be building deep social networking features into Kinect, which will in turn allow users to share their gaming experience with their friends (and in turn, subtly encourage others to join the fun by purchasing their own Kinect). Microsoft hasn’t set a specific price point, but rumors afloat on the great ship U.S.S. Internets, are indicating anywhere between $70 – $200. The scheduled release date for Kinect is this autumn, which gives Microsoft plenty of time to line up the Kinect launch with an anticipated Xbox 360 ‘slim’ (can you say bundle?).

The Kinect marks Microsoft’s foray into taking on the wildly popular Nintendo Wii. Wii, which has sold some 70 million units worldwide, features a unique motion-sensing controller that players use to interface with the game. Sony also has their own answer to the Wii interface, and is expect to debut its “Move” controller at E3 this week. However, Sony’s Move looks to be little more than a reverse engineered Wii controller, as the general principles are the same. Microsoft takes this motion sensing concept one step further, and eliminates the controller altogether. The player of the game IS the controller.

As social/casual games start to take a much bigger hold, and appropriately, attention of gamers, it’s clear that there’s quite a lucrative market here waiting to be tapped. Realizing that their ‘core’ brand of gamer is perhaps a bigger fan of shooters (I’m looking at your Halo and Gears of War), and has sought to bring in a much larger audience with the control-less interaction features of Kinect, as well as tap into the social networking pull of it all.

And while Sony might not have the Bing-Bang-Zoom features that Kinect is sporting, there are other rumblings in the news that could put both Sony and Nintendo back in the spotlight: 3D. The Nintendo handheld 3DS is on tap at E3, and Sony is expected to have 3D-compatible PlayStation titles on display, including the … wait for it … long awaited … Gran Turismo 5 (really? Do not tease me, yet again).

With this much chatter on the radio waves before the main doors have even opened, it looks like E3 may just have regained its slot on the top of gaming conferences. The event opens tomorrow, Jun 15th, and runs through June 17th at the Los Angeles Convention Center.

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