Master Gamer News

March 30, 2001
   Sega has announced its support of the Microsoft Xbox, with 11 games 
currently in development exclusively for the Xbox.  Of these 11 games, the 
four that have already been announced are the newest versions of Panzer 
Dragoon, Sega GT, Jet Grind Radio, and Gun Valkyrie.  Beyond these games, 
Sega has not revealed any details about its Xbox plans.  When asked for a 
comment on Microsoft's signing of Sega, PS1 and PS2 creator Ken Kutaragi's 
entire response was, "I'm not worried."

   Sony has allegedly strong-armed retailers into limiting their in-store 
advertising and pre-orders of the Microsoft Xbox.  Electronics Boutique and 
Toys R Us stores are currently displaying Xbox advertising, but are not 
accepting Xbox pre-orders and have not done so in the past.  On the other 
hand, Babbage's was both advertising the Xbox and accepting pre-orders for 
it a few weeks ago, but is now doing neither due to alleged threats from 
Sony.   
   The story goes that Sony gave Babbage's an ultimatum: Stop advertising the 
Xbox and taking pre-orders for it, or we'll cut off your supply of 
PlayStation 2 systems.  Trade publication MCV has substantiated these 
reports by calling a random sampling of 20 Babbage's locations throughout 
the country.  An alarmingly high 17 of the 20 stores backed up the reports 
about Sony's threats.
   Despite overwhelming evidence, Babbage's VP of business development Russ 
Howard denies that his company is having any problems with Sony.  Howard 
claims that Babbage's voluntarily halted its advertising and pre-orders of 
the Xbox due to concern that it wouldn't be able to fulfill the rapidly-
increasing amount of pre-orders when the system launches.  Pre-orders of the
PlayStation 2 last year spiraled out of control to well over one million, 
which left many people empty-handed when Sony shipped less than 400,000 
systems on launch day.
   In response to Sony's alleged actions, Microsoft's director of Xbox 
marketing John O'Rourke says, "We've heard from our retailer partners that 
there have been discussions with other companies... when someone suggests to
them, 'Hey, I suggest you take down those Xbox (advertising) materials,' in 
some cases they may do it because they have a short-term business need, and 
we understand that.  Other times, they'll just look at it and laugh it off."

   Nintendo has not outright threatened any retailers, but its VP of sales, 
Peter Main, has sent a very carefully-worded letter to retailers nationwide 
in which he strongly encourages retailers to stop supporting the Xbox.  The 
wording of the letter attempts to make retailers believe that Nintendo is not
trying to hurt the Xbox, and is merely looking out for the good of the video 
game industry as a whole.  Main said, "I am suggesting that Nintendo may have
more concern about the health of the industry than a company with a current 
zero share of the market."
   In the now-infamous letter, Main also said, "The curious question is why 
retailers would join with a potential future industry participant, eight to 
ten months or perhaps longer before his unspecified product arrives, to 
essentially sell against current sales by installing an array of 
(advertising) materials, which essentially suggest to their customers to wait
for this alleged new product."  Clearly, Peter Main was absent on the day 
that his grammar school class learned about run-on sentences...
   After the initially-confidential letter hit the Internet, Nintendo's VP 
of marketing, George Harrison, issued a statement about it.  Harrison said, 
"The purpose of the letter was to express to retailers our own curiosity as 
to why they felt this material belonged in their store... Microsoft is not 
in the business, but they would like nothing more than to say to people, 
'Don't buy a PlayStation 2, wait until next October (for the Xbox).'"
   In response to Nintendo's letter, a Microsoft spokesperson says, "We're 
very pleased to see that Nintendo is paying attention to the Xbox.  At the 
same time, we're very concerned that they're trying to control the flow of 
information from retailers to consumers."
      
   Activision, the #2 third-party publisher based on US sales, remains at 
the center of a whirlwind of possible buy-outs and mergers.  Several weeks 
ago, Hong Kong-based Pacific Century CyberWorks (PCCW) made a formal offer to
Activision for a buy-out.  Activision has not yet accepted or rejected PCCW's
offer, but is said to be leaning towards rejecting it.
   At the same time, THQ is once again interested in merging with Activision.
Last year, unsuccessful negotiations took place for a three-way merger 
between Activision, THQ, and Midway.  PCCW is still interested in breaking 
into the US gaming market, with or without Activision.  If Activision rejects
PCCW's offer, the next company on PCCW's hit list is... you guessed it... 
THQ.  So, PCCW wants to buy Activision, THQ wants to merge with Activision, 
and PCCW wants to buy THQ.  I think I'm getting a head-ache...

   Nintendo has upset numerous third-party publishers with its self-centered
Game Boy Advance business model.  Nintendo has structured the royalty 
payments in such a way that it will be the only company that is able to 
profitably give its GBA games a suggested retail price (SRP) of $30.  If 
third-party publishers want to make a profit, they will be forced to sell 
their games at the much less attractive SRP of $40 (which is just $10 less 
than new-release PlayStation 2 games).
   Even with SRPs of $40, profit margins for retailers and third-party 
publishers will still be lower than they are with the Game Boy Color.  An 
executive at a third-party publisher who wishes to remain anonymous says, 
"It shocked the hell out of us that Nintendo was going to do that.  The 
royalty structure with Nintendo doesn't let anybody go to $30 but them."
   Nintendo has also upset retailers with its announcement that there will
only be 500,000 GBA systems shipped to retailers for the launch on June 11, 
not the previously announced figure of one million units.  Nintendo claims 
that a total of more than one million systems will be shipped to retailers 
by the end of June, and that the initial shipment is being limited to 500,000
"for strategic purposes."  
   In other words, Nintendo is hoping to increase demand for the system by 
artificially limiting the supply, and it has no qualms about admitting this.
The Game Boy Advance will carry a suggested retail price of $100, but given 
the fact that Nintendo will be selling the systems to retailers for just $88
per unit, you can probably expect to see systems being sold for $90 at some 
retailers.

   Electronics Boutique plans to offer downloadable rentals of PC games on 
its web site by June 1 of this year.  Consumers with DSL or cable modem 
connections will be able to pay a fee to download PC games and play them for 
a certain number of days before the software requires that they buy the games
if they want to continue playing.  EB has not yet decided the price that it 
will charge consumers to rent games, nor the number of days that each rental 
period will last.
   To get this service up and running, EB has partnered with the broadband 
Internet division of the $40 billion gas and electric tycoon, Enron.  Enron 
previously signed a similar deal with Blockbuster Video to provide 
downloadable movies, but eventually backed out of the deal before anything 
became of it.
   Electronics Boutique will need the permission of individual game 
publishers to offer their games as downloadable rentals.  EBgames.com's 
president Seth Levy says, "We think there's going to be an opportunity to 
promote games in ways that publishers find attractive and that will lead to 
greater sales."
   When asked about the possibility of these rentals being extended to 
include console games, Levy responds, "For the forseeeable future, this move
is for PC games.  Consumers need a broadband connection and a hard drive."  
The Xbox will have a hard drive and broadband adapter built-in to every 
system sold, but EB would still need to strike a deal with Microsoft before 
Xbox games could be offered as downloadable rentals.

   The 4th Annual Interactive Achievement Awards ceremony recently took place
in San Jose, California.  Winners included:
Overall Game of the Year: Diablo 2
PC Game of the Year: Diablo 2
Console Game of the Year: SSX Snowboarding
Outstanding Achievement in Visual Engineering: SSX Snowboarding
Outstanding Achievement in Gameplay Engineering: SSX Snowboarding
Outstanding Achievement in Art Direction: Final Fantasy 9
Outstanding Achievement in Animation: Final Fantasy 9
Outstanding Achievement in Sound Design: Metal of Honor- Underground
Outstanding Achievement in Musical Composition: Metal of Honor- Underground
Outstanding Achievement in Game Design: Zelda- Majora's Mask
Outstanding Achievement in Character and Story Development: Baldur's Gate 2
Massively Multi-Player Game of the Year: EverQuest- Ruins of Kunark
Best Online Gameplay of the Year: MechWarrior 4
Innovation in PC Gaming: Deus Ex
Innovation in Console Gaming: Shenmue
Most Full-of-Crap Awards Show of the Year: Interactive Achievement Awards

   Last year, Origin Systems cancelled all of its games-in-progress that 
didn't have online components, then Origin cancelled all of its games that 
didn't tie into the Ultima universe, and now Origin has cancelled the sequel
to Ultima Online.  The sequel was in development for several years and was 
about one more year away from completion when the plug was finally pulled by 
Origin and its parent company, Electronic Arts.
   Origin's David Swafford says that the decision was made so that the 
company could continue to focus on the original Ultima Online and its 230,000
subscribers.  Expansion packs such as the recently-released "Ultima Online: 
Third Dawn" will continue to be released for UO in the future.  As part of 
the sequel's cancellation, Origin has laid off approximately 85 of its 
employees.

   Few people believe it, but Sony claims that it has shipped over 10 million
PlayStation 2 systems worldwide.  Sony claims that it has shipped a total of
4.7 million systems in Japan, 2.8 million in North America, and 2.6 million 
in Europe.  There continue to be huge differences in the official numbers 
supplied by Sony and the numbers released in statements by retailers and 
independent sales-tracking companies.  In addition, less than two months 
before the "10 million units" announcement, Sony itself announced that it 
would only be shipping nine million units before March 31, 2001.

   Electronic Arts has yet to officially announce its support of Nintendo's 
GameCube, but it does indeed have games in development for the system.  EA's 
chairman and CEO, Larry Probst, practically confirmed EA's support of the 
GameCube in a recent teleconference when he said, "We think the GameCube is 
going to be an important platform in the next generation of platforms.  I 
think you could surmise that we would be there when the GameCube is launched 
as a new platform, and going forward from there as well."

   Video game retailer Electronics Boutique made some interesting 
"projections" in its newest financial statement.  EB expects the GameCube to
be released in November at a $200 price point, and it expects the Xbox to 
launch in October at a $300 price point.  On a related note, Electronics 
Boutique isn't the only company that expects the Xbox to launch at $300.  
In a conversation about the Xbox, Nintendo's VP of marketing George Harrison
recently said, "There is no doubt that the potential consumer for an N64 
wouldn't necessarily be the same consumer who's looking to buy a just-
released, next-generation machine for $299."

   Threshold Entertainment previously acquired the rights to make a movie 
based on 3D Realms' Duke Nukem franchise, and Threshold has now sold its 
rights to Dimension Films.  Dimension plans to work with Threshold in the 
development of the movie, with Threshold's CEO Larry Kasanoff serving as the
film's producer.  Kasanoff previously produced both of the Mortal Kombat 
movies.  Dimension Films has also announced that Duke Nukem: The Movie will 
be tame enough to given a PG-13 rating.

   Saudi Arabia is the latest country that has banned all Pokemon-related 
products.  The country's highest Islamic authority has issued an official 
edict that states, "Pokemon has possessed the minds of a large chunk of our 
students, captivated their hearts, and become their preoccupation... they 
spend all their money to buy the cards and compete with each other to win 
more."  The edict also says that Pokemon "involves gambling" and "includes 
symbols that promote Zionism," both of which are illegal in Islam.

   Sega has announced that the Sega Smash Pack will soon be available as a 
separate purchase from the Dreamcast console.  The Smash Pack contains eight
Sega Genesis games and two Dreamcast games (Virtua Cop 2 and Sega Swirl) on 
one GD-ROM.  Babbage's reports that the Smash Pack will be released on April 
24 at a price point of $40.

   Babbage's Etc. operates over 200 more stores than Electronics Boutique, 
but EB is in much better shape financially.  In the financial year that ended
on February 3, EB beat Babbage's in terms of revenue, $770 million to $760 
million.  More importantly, EB's bottom line was a $15 million profit, while
Babbage's posted a $10 million net loss.  Babbage's parent company, Barnes & 
Noble, is in even worse shape, posting a $52 million net loss in the same 
12-month period.

   The Dreamcast version of Half-Life is now due out in May, but this release
date doesn't really carry any more weight than any of the game's previous 
six release dates.  The Dreamcast version of the game will contain no multi-
player modes of any kind.  In addition, the game's "Blue Shift" single-player
campaign, previously said to be Dreamcast-exclusive, is now scheduled to be 
released for the PC this fall as a stand-alone retail product.

   A law has been proposed in New Hampshire that would place a tax on video 
games and donate all proceeds to victims of sexual assault.  Supporters of 
the law, which would also tax movies, say that both games and movies often 
"feature sexual violence" and "portray women as objects of sexual 
gratification."  Under the proposed plan, the tax would be $1 per sale and 
five cents per rental of video games and movies.

   Acclaim plans to publish the first-ever indoor lacrosse video game 
sometime this spring.  Called Blast Lacrosse, the game is for the PS1 and 
features arcade-style gameplay.  In the press release announcing Blast 
Lacrosse, Acclaim's director of brand management Steve Felson said, "Acclaim
Sports continues to lead the video game industry by introducing ground-
breaking sports games."  Reports that Felson was struggling to keep a 
straight face while making that statement could not be confirmed at press
time.

   The corporate marriage between Titus and Interplay has not been a marriage 
made in heaven.  The French owners of Titus extended a $5 million line of 
credit to California-based Interplay last year, and Interplay is now 
claiming, "We have been notified by Titus that it no longer feels obligated 
to fund this line of credit."  In addition, investment bank HSBC reports that 
Titus is looking into the possibility of selling off part or all of its 44 
percent ownership stake in Interplay.

   Is the GameCube really going to be released in the US this year?  In 
response to this question, Nintendo's George Harrison says, "The GameCube is 
definitely going to ship this year.  I think there has been speculation 
because some of the third-parties have only received their development kits 
more recently and they're saying, 'Gee, if I can't get a game ready by the 
end of 2001, how could they possibly launch the GameCube this year?'"

   Japanese publisher Koei has announced that it is taking a wait-and-see 
approach towards the GameCube, but it already has two Xbox games in 
development.  One of these games has yet to be revealed, while the other is 
an Xbox version of the cult hit Romance of the Three Kingdoms series of 
strategy games.
     
NEWS BRIEFS
   The Xbox's broadband network won't be up and running until sometime in 
2002.  Microsoft has announced that NTT Communications will be its Japanese 
broadband partner, but has not yet announced any US broadband partners.

   Nintendo's Ken Lobb has officially confirmed that a Metroid game is being
developed for the Game Boy Advance.  Lobb says that it will be an all-new 
game, not a port of any previous Metroid game.

   Microsoft has increased the size of the Xbox's hard drive, which will be 
built-in to every system sold.  Formerly 8GB, the hard drive is now scheduled
to be 10GB.

   Book publisher Random House has announced its purchase of Prima, the 
leading seller of video game strategy guides.  Future strategy guides from 
Prima will display both the Prima brand and the Random House brand.

   Gran Turismo 3 is still scheduled to be released in Japan in late April, 
with the US and European versions to follow in June at the earliest.

   For what it's worth, most of the Game Boy Advance's Japanese launch games 
were judged harshly by Japanese gaming bible Famistu.  Nintendo's F-Zero game
received the equivalent of a "C" score, while Super Mario Advance received a
"D" and the average of all games was a "D."

   Tecmo has announced that it is working on Dead or Alive 3 exclusively for 
the Xbox.

   According to trade publication CTW, under-achieving French developer 
Kalisto could be forced to file for bankruptcy in the near future.  With 
games like 4-Wheel Thunder and Nightmare Creatures 2 under its belt, 
Kalisto's dire financial situation shouldn't come as a surprise to anyone.

   Activision has acquired the exclusive rights to publish games based on the
upcoming Spider-Man movie, which is due out in May 2002.  Activision has also
announced that Id Software is working on a Game Boy Advance version of Doom.

   Crave Entertainment has exited the PC game publishing market.  Electronic 
Arts has purchased the publishing rights to all of Crave's former PC games, 
most notably Battle Realms and Freedom Force.

SALES CHARTS
   The following sales charts are based on sales from March 4 to 17.

Top Ten Best-Selling Games For All Systems
1. The Bouncer for PlayStation 2
2. Onimusha for PlayStation 2
3. Conker's Bad Fur Day for Nintendo 64
4. Pokemon Silver for Game Boy Color
5. Pokemon Gold for Game Boy Color
6. Paper Mario for Nintendo 64
7. Madden NFL 2001 for PlayStation 2 (click on the blue text for Master 
Gamer's review of the game)
8. Triple Play Baseball for PlayStation 2
9. Star Wars: Starfighter for PlayStation 2
10.Tiger Woods PGA Tour Golf 2001 for PlayStation 2

Top Five Best-Selling PlayStation 2 Games
1. The Bouncer
2. Onimusha
3. Madden NFL 2001
4. Triple Play Baseball
5. Star Wars: Starfighter

Top Five Best-Selling Dreamcast Games
1. NBA 2K1
2. Crazy Taxi
3. Phantasy Star Online
4. Sonic Adventure
5. Daytona USA

Top Five Best-Selling PlayStation 1 Games
1. Tony Hawk's Pro Skater 2
2. Driver 2
3. Gran Turismo 2
4. WWF Smackdown 2
5. Spec Ops: Stealth Patrol

Top Five Best-Selling Nintendo 64 Games
1. Conker's Bad Fur Day
2. Paper Mario
3. Donkey Kong 64
4. Super Smash Bros.
5. Pokemon Stadium

Top Five Best-Selling PC Games
1. The Sims
2. The Sims: Livin' Large
3. RollerCoaster Tycoon
4. Diablo 2
5. Hoyle Casino 2001

Sources for news: Fastest Game News Online, ZDNet, GameFan, Blue's News, 
Next Generation, Adrenaline Vault, MCV, The Magic Box, GameSpy, Daily Radar, 
Core Magazine, PSX 2 Online, PS2 Era, Nintendorks, IGN, RPGamer, Famistu, 
Gaming Age, The NPD Group, PC Data, www.cowdance.com

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