FWIW, they've often been criticized for their shoddy predictions of the entertainment market. Just being so completley polar on gamecube (from one million units sold in year one to 10 million?), and just after seeing a few games at E3, shows how little actual research they appear to do.

I'd be weary of their financial estimates of the cost of manufacture as well. They were WAY off on the Xbox cost they predicted awhile back, and had to revise the PS2 financial impact on Sony at least a couple times. They've been scolded by virtually every console manufacturer in the past for not having a clue about the way the business works.

Was it Henry Blodgett by any chance?

I honestly think we're fast approaching a day when large conglomerates of market forecasters and analysts are ridiculed and ignored. There is so much guessing involved in any industry and often a company comes out of nowhere with a product that completely shatters and earlier projections.

In the game industry, this is certainly true because all it really takes is that one must have (forgive me) "Killer App" that makes one console much more desirable than the rest. If an analyst was sitting there playing games and following up on works in progress, he's likely have a different view of the entire industry.

That said, I do think Nintendo is going to stomp a big fat boot down on Microsoft. Sony will maintain their current pace and do quite well in the end. Have you seen the news at CoreMagazine.com about people buying up old Famicom (NES) games in Japan? The reason supposed is that the games hold a simple appeal that is missing in a lot of today's games. Well, Nintendo really never stopped making those kinds of games. They just have prettier wrappers now. I think they're poised to dominate if they play their cards correctly.

Plus that Cube is really tiny and cool IMO. I honest-to-God have no room for an Xbox in my house based on its physical size. Japanese apartments are about as big as my bathroom...no way they're putting an Xbox in it. It's about the games primarily though and all the Nintendo stuff appeals to me. Only a couple of the Xbox games do because they all look like something I'd get on the PC where I can enjoy them more anyway.

I enjoyed The Gaming Intelligence Agency's E3 Wrap-Up. This line (which sounds like it was ripped straight from the mouth of Erik Wolpaw) was one of my favorites...

---

Quote:

Fuzion Frenzy is billed as a party game, but its dark, dystopian, steel environments, distant camera, and use of colors instead of characters makes it feel more likely to suck the fun out of any party. It's the party game for gamers who are tired of life.

---

Fusion Frenzy is an Xbox game BTW.

--Dave

Also... Gamecube is getting this...also taken from The GIA's article.

---

Quote:

Best Actual Use of Monkeys in a Monkey-Based Game: Super Monkey Ball.

You're a monkey! In a plastic ball! The great ideas always sound simple when you describe them.

---

Monkey in a ball? No way! Where do I sign up? ;)

-- Xaroc

I saw Monkey Ball over at the Sega booth. Really wacky, and oddly compelling. The monkey reminds me a lot of Samba De Amigo. Well, in a hamster-ball. =)

This is interesting:
http://ps2.ign.com/news/35550.html

I found it intriguing that they haven't decided on a system for Ninja Gaiden yet. The remarks about american Xbox developers is interesting, too.

>I honestly think we're fast approaching a day when large conglomerates of market forecasters and analysts are ridiculed and ignored.

I like to ridicule them already! Especially forecasters. =) Analysts have some use in putting together statistics on current and past market conditions, at least.

>all it really takes is that one must have (forgive me) "Killer App" that makes one console much more desirable than the rest.

Even outside of consoles, such a hit-based business is hard to judge. You never know when some struggling publisher will put out a game that unexpectedly sells 4 million copies and turns it all around.

re: Console wars--with the exception of the 15-month old PS2, it's just too early to tell. Consoles become "big" in year two and beyond, and we haven't seen what either Nintendo or Microsoft has on the plate for Xmas 2002 and beyond. PS2 is actually IN year 2 now.

As for xbox size, if people want one, they'll find room. It's smaller than most DVD players, and those sell fine. Could be an issue in Japan, true, but I wonder if it's that big a deal. Everyone's saying it is, but nobody's tried to sell a big console there yet. They got room for 26" TVs, after all. =)

"I honestly think we're fast approaching a day when large conglomerates of market forecasters and analysts are ridiculed and ignored."

Unfortunately, the people who pay most attention to the securities analysts are the companies being analyzed. Large companies do extremely short-sighted and stupid things based on analysts' comments and with the sole intention of swaying their opinions. I was part of a 3 day event for a Fortune 50 company in which about 100 analysts were wined and dined and given numerous presentations in order to convince them to write glowing recommendations for the stock. It was the first time I'd ever seen the CEO actually sound nervous.

Jeff

""I honestly think we're fast approaching a day when large conglomerates of market forecasters and analysts are ridiculed and ignored."

Market forecasters are already taken with more than a grain of salt. In a lawsuit by an investor who had lost $300 million in US dollar futures based partly on bullish statements about the dollar by its chief economist, Wayne Angell, Bear Stearns used as part of its defense that such forecasters are essentially "entertainers" who are only right about 35-40% of the time.

Equity analysts are another story. Research is a crucial part of an investment bank's underwriting machinery and whether or not they're right, they're listened to. The scenario Jeff describes certainly happens routinely, but the wining and dining pales in comparison to one simple fact: most analysts' pay is not linked to their accuracy -- it's linked to the firm's underwriting revenues. Because top analysts can earn eight figures after salary and bonus, it's this effort to win future underwriting business from companies which is the real concern, not junkets.

Equity analysis and stock underwriting is an incestuous business that is frequently called into question, and makes the ridiculous "review payola" argument look like the parochial non-issue that it is.

"In a lawsuit by an investor who had lost $300 million in US dollar futures based partly on bullish statements about the dollar by its chief economist, Wayne Angell, Bear Stearns used as part of its defense that such forecasters are essentially "entertainers" who are only right about 35-40% of the time."

The lawyer in me has to ask: Did Bear Stearns win?

"The lawyer in me has to ask: Did Bear Stearns win?"

They lost. But the very fact that they trotted out this defense just shows you how seriously people view market forecasters.

I did a quick search but could only find this reference to the "entertainer" remark in the Washington Post. A more comprehensive search would turn up a better reference. I recall first reading about it in the NYT last year -- you can try searching there.

http://www.washingtonpostnewsweek.com/wp-srv/WPlate/2000-06/30/173l-063000-idx.html

If you want to read an interesting (albeit somewhat breathless) account of the story, here's a New York Observer article about it.

http://www.observer.com/pages/story.asp?ID=3428

"They lost. But the very fact that they trotted out this defense just shows you how seriously people view market forecasters."

Yeah, knowing how lawyers' minds work, this looks like a defense team cooking up 1)Everybody knows analysts suck so 2) why should we have to inform him when nobody in their right mind relies on them anyway?

The reason I'm actually not surprised Bear Stearns lost is that it was the conclusions of Bear Stearns' own commodities-research department that they didn't tell him about. When I first saw the story, I thought it was some guy on Wall Street Week. Being, like Bruce, a true Renaissance man, I'm also a securities arbitrator. Without all of the evidence, I couldn't tell you how I'd decide this case. I can tell you that neglecting to tell the investor about their own negative research would get my attention.

The thing is, there would really have been no reason to hide the negative opinions on the dollar from this Kwiatkowski character. If Bear Stearns convinces him to unwind all of his positions, they get paid commissions for all of the closing trades. Sure, he's paying margin interest, but he had clearly demonstrated a propensity for taking large positions, so it's not like he's going to take his money elsewhere. If you think the position is dangerous, get him out of it and into something else, for God's sake.

Retail brokers -- Jesus H.

I agree. And it's not like they needed to churn this account to generate commissions either. Man, the broker was calling him 20 times a day to consult on trades. It's also not like he was Mr. Naive about the dollar either. Not telling him was probably no more than simple neglect. And, it's doubtful it would have made a difference. I'd rate the chances of this verdict holding up at no great than 50-50.

Getting back to the value of analysts in general. Lexis-Nexis has newspaper archives going back through the 80's. I was doing some research a while back on the software industry as a whole. After the poor reception of Windows 1.0 back in '84, one analyst quoted in the WSJ said, "Gates really blew it with Windows. It's uncertain whether Microsoft can survive this." Those words should be carved in stone, eh?

"Gates really blew it with Windows. It's uncertain whether Microsoft can survive this." Those words should be carved in stone, eh?
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At least he hedged his bet with an "uncertain".
;)

Not really related, but it has been rattling in my brain a while but I read a great anecdote while researching an article on Children's books.

Apparently an editor at Golden rejected a certain chapter book primarily because Golden doesn't publish Juvenile chapter books (they publish for the younger set). This editor added a line to the standard rejection that he thought the story in question was "ridiculous".

Anyway, the book was EB White's "Charlotte's Web". White sent the rejection slip back to Golden much later and that slip is said to be framed in the Editor's lounge area for all to see.

-Andrew

Based on that criteria, it sounds like this editor would have passed on all the Grimm fairy tales and Hans Christian Anderson's entire body of work.

"After the poor reception of Windows 1.0 back in '84, one analyst quoted in the WSJ said, "Gates really blew it with Windows. It's uncertain whether Microsoft can survive this." Those words should be carved in stone, eh?"

Microsoft is lucky they had MS-DOS as a source of revenue, or else they might not have survived it.

I remember trying Windows 2.0 and it really sucked. At the same time I used Ventura for page layout, and it used the GEM OS. I could create 30 page WYSIWYG documents with screen captures and the documents were quite manageable and stable working on 640k systems. Years later using Word on much more powerful systems I experienced worse performance with my documents.

Heh, yes, DOS did save them, which just shows that Windows wasn't quite the gamble that analysts like the one I quoted thought it was.

No need to get into another Microsoft software sucks thread. It was just the way that particular bit of business fortune-telling looks from today's perspective.