Acclaimed director and aspiring game developer Michael Bay (Transformers, The Rock, Playboy Video Centerfold: Kerri Kendall) has lambasted Microsoft's HD DVD initiative as a ploy meant to weaken the format and eventually strengthen the company's on-demand video service.

"Microsoft wants both [HD DVD and Blu-ray] formats to fail so they can be heroes and make the world move to digital downloads. That is the dirty secret no one is talking about," Bay wrote on his official forums.

"They want confusion in the market until they perfect the digital downloads. Time will tell and you will see the truth," he continued. "That is why Microsoft is handing out $100 million dollar checks to studios just [to] embrace the HD DVD and not the leading, and superior Blu Ray [sic]."

Microsoft is currently using the Xbox Live Video Marketplace to sell television shows and rent on-demand movies to Xbox 360 users in the United States. Just yesterday, the company announced it would be expanding the Video Marketplace to... Read more

A tally of the past four weeks of Japanese hardware sales shows that Sony's PlayStation 3 outsold Nintendo's Wii for the first time, according to magazine publisher and marketing data provider Enterbrain.

The figures, as reported by Reuters, show that the PS3 sold 183,217 units throughout November, whereas the Wii only sold 159,193.

The strong sales of the PlayStation 3 are attributed to this month's releases of Konami's soccer title Winning Eleven 2008 (PS2, PS3, X360) and Omega Force's slash 'em up Dynasty Warriors 6 (PS3). Both series are extremely popular in Japan, and tracking firm Media Create states they were the two best-selling PS3 games between November 19 and 25.

In terms of overall software sales, Winning Eleven 2008 was the third best-selling title of that time, topped only by the PS2 edition of the game and Square Enix's DS remake of Dragon Quest IV. Dynasty Warriors 6, which debuted earlier this month, came in at #13, with only two Wii games--Nintendo's Super Mario Galaxy and Sega's Mario & Sonic at the Olympics--outselling it.

Current PlayStation advertising firm TBWA/Chiat/Day is no longer a contender in Sony Computer Entertainment America's search for a marketing agency, reports Advertising Age.

TBWA began working with PlayStation brand in 1994 and has been creating ads for it across the past 13 years. Among the company's efforts are the "u r not e" campaign for the original PlayStation, which many gamers still reference more than a decade later, and the more recent white-room commercials for the PlayStation 3.

The new home for the $150 million PlayStation account has yet to be announced, though SCEA is said to have requested more information from at least two of the four companies still under consideration.

For the third time this week, Nintendo has spoken out on the shortages afflicting its ever-popular Wii console, which is still difficult to find on store shelves after over a year on the market.

"Typically, we'd have begun stockpiling console hardware back in August [for the holiday rush]," Nintendo senior VP George Harrison told Wired. "But this year, we were selling all the Wii we could get, and we got all the way through the summer with basically no inventory in our warehouse."

Nintendo currently produces about 1.8 million Wii units a month. About a third of those are allocated for North America, where the $250 system sold more than 350,000 units last week.

Harrison also commented that, based on the strong performance of Western third-parties and developers, the company has no incentive to acquire... Read more

In just over a year, Nintendo's Wii-based online Virtual Console service has netted over 3.5 billion yen ($31.7 million USD) in revenue.

Using the Virtual Console portion of the Wii Shop Channel, gamers can purchase and download retro classics from a variety of older video game systems, including the Nintendo Entertainment System, Super Nintendo, Sega Genesis, and TurboGrafx-16. In all, the service has accumulated more than 7.8 million downloads, and new titles are added each week.

The figures, as reported by IGN, were disclosed at a press conference in which the company discussed its recent teaming with Japanese internet provider NTT to promote the Wii's internet connectivity.

"We're currently unsure if this is a lot or low," said Nintendo executive Shinji Hatano. "They're not bad figures."

Nintendo plans to begin offering original downloadable titles--a la Xbox 360's Xbox Live Arcade and PlayStation 3's PlayStation Store--through the WiiWare portion of the online store in early 2008.

In a very carefully worded statement, Sony Computer Entertainment America has announced that sales of the PlayStation 3 in North America's top ten retailers have increased 298% since the $399 40GB model hit November 2.

On a smaller scale, PlayStation 3 sales at those select retailers were up 245% on the day after Thanksgiving--commonly referred to as Black Friday--compared to those of last year.

Though Sony did not provide any hard numbers, the PlayStation 3 sold about 120,000 units per month across September and October. However, the specifics of the provided percentages make it difficult to confidently calculate hardware sales using this figure, causing some to wonder what, if anything, the announced numbers imply.

The PS3 launched in North America on November 11, 2006, mere weeks before Black Friday. Likely explanations for this year's jump in Black Friday sales over... Read more

Former Sony Computer Entertainment CEO Ken Kutaragi, the "Father of PlayStation," will receive the Academy of Interactive Arts & Sciences 2008 Lifetime Achievement Award at next year's D.I.C.E. Summit, the academy announced today.

The ceremony on February 7 will mark the second time a lifetime achievement award has been granted by the academy, with the first going to former Nintendo of America executives Minoru Arakawa and Howard Lincoln this year.

Kutaragi retired from his position as director, chairman and group CEO of SCEI on June 19, replaced by SCEI president Kaz Hirai. He now serves as honorary chairman and senior technology adviser to Sony CEO Howard Stringer.

During his tenure at SCEI, Kutaragi helmed the creation of every major PlayStation product, including the handheld PSP and PlayStation 3.

Xbox 360's Xbox Live Arcade was once billed as a utopia for independent developers, where smaller studios could easily develop and cheaply distribute new titles. That may be changing as the "dreaded realities of business models" set in, Frozen Codebase design director Norb Rozek tells Shacknews.

"Uh," Rozek responded when asked if he thought it odd Microsoft recommended a publisher to the studio, whose upcoming Arcade game Screwjumper is published by THQ. "I think Xbox Live Arcade has gotten to the point where the dreaded realities of business models are setting in. The wild wild west period is over."

Green Bay-based independent developer Frozen Codebase began developing its debut game Screwjumper for Arcade in 2006. The company originally pitched the game directly to Microsoft but was recommended to sign with a publisher rather than go straight to the service.

"[Being told to find a publisher] doesn't strike us as weird," Rozek continued, "but things aren't quite as 'yee-haw, kick down the doors, let's going in with our guns blazing' as you would like to hope. But what the hell, that's just the way things are, man."

Under conditions of anonymity, developers from other studios have... Read more

Sony Corp.'s Game division made up by subsidiary Sony Computer Entertainment Inc. revealed operating losses today for the second fiscal quarter of 96.7 billion yen ($841 million). The amount more than doubles last year's losses of 43.5 billion yen for the period of July through September.

Sony attributed the losses, as usual, to selling PlayStation 3 hardware for a loss. But software sales for both PlayStation 2 and PSP titles had decreased as well, with PS2 titles selling 9.2 million units less than last year's second quarter at 38.0 million, and PSP titles down 600,000 units to 12.6 million.

Although PS3 hardware sales can't be compared year-over-year, it nearly doubled its paltry first quarter sales, with Sony selling a relatively high 1.31 million units of the console due most likely to pricing rearrangements. Sony recently cut the price of the 80GB PS3 SKU worldwide and introduced a new 40GB baseline barebones model in all territories, so increased sales reflecting these changes should be posted in the current quarter.

Despite the Game division's grim outlook, Sony Corp. overall came away with a remarkable 73.7 billion yen ($641 million) profit for the quarter, a huge increase over last year's second quarter profits of 1.7 billion yen.

Kyoto-based game giant Nintendo reported its mid-year financial results today, posting a 132.5% increase in year-over-year sales to 694.8 billion yen ($6.072 billion) for the six months ending September 30. The vast majority of these sales came from sales of the increasingly popular Wii and still top-selling DS, with hardware sales taking in 452.7 billion yen ($3.957 billion) during the period.

Most of the revenues, 77.9%, came from overseas sales in markets like the U.S. and Europe. Nintendo's profits showed even greater gains, rising to 132.4 billion yen ($1.157 billion), a 143.7% increase over the first half of the last fiscal year.

Nintendo sold 7.33 million Wii consoles and 13.35 million DS units worldwide during the first half of the current fiscal year, bringing lifetime sales numbers for each console to 13.17 million and 53.64 million, respectively, and furthering Nintendo's reign over both the home console and handheld markets.

Strong software sales of titles like Game Freak's Pokemon Diamond and Pokemon Pearl--which sold 6.95 million units during the period--padded the company's profits as well. The Brain Age series of DS games also continued to sell, a popular title among Nintendo's casual demographic, with the first two games in the DS series hitting 5.19 million units sold during the period.

Nintendo has projected sales of 1.55 trillion yen ($13.5 billion) during the current fiscal year ending in March.

Famed Nintendo game designer and Wii mastermind Shigeru Miyamoto received The Innovation Award for Consumer Goods from London-based money magazine The Economist last night. The award recognizes Miyamoto's contributions to the Wii in light of its recent success, along with the innovator's lifetime achievements.

"No one is more identified with modern video games than Shigeru Miyamoto," said Economist business editor Tom Standage at last night's event, held at the Science Museum in London. "His pioneering vision and creativity truly created a new category of entertainment."

Earlier this year, Miyamoto was awarded the Lifetime Achievement Award at this year's Game Developers Choice Awards. This year marks three decades of employ under Nintendo for the designer, who will be 55 years old next month on November 16.

Teaming up with HD DVD promoter Toshiba, Microsoft has just announced an incentive for purchasers of its Xbox 360 HD DVD Player, giving U.K. customers who purchase the add-on between now and January 31 five free HD DVD flicks. The offer is slightly different than the recently begun HD DVD incentive for American customers, but matches Sony's existing promotion for five free Blu-ray movies with the purchase of a PlayStation 3 or select other Blu-ray players, which runs through January 31.

Purchasers of Toshiba HD DVD players or certain Toshiba HD DVD-equipped computers are also eligible for the U.S. offer, which runs longer than the U.K. promotion through February 28. Americans can pick five titles from... Read more

NPD's U.S. sales figures for the month of September--the month of Bungie's Halo 3 launch--have arrived. Led by the highly anticipated title, total video game sales for the month reached $1.36 billion, a 74% year-over-year increase. Home console sales showed the most marked increase across the board, with $418.6 million in revenue, nearly three times more than the same month last year before the Wii and PlayStation 3 launches.

Both software and hardware sales were dominated by either Halo 3 or the game's platform, Xbox 360. Unsurprisingly taking the top spot for software, sales of all Halo 3 versions hit 3,256,082 units, bringing Microsoft approximately $225 million in revenue. Each version actually sold more on its own that any game in September, with the standard $59.99 edition's 2,367,795 leading, followed by the $69.99 collector's edition with 511,437, and the $129.99 Spartan helmet-including Legendary edition's 376,850 units sold.

No doubt spurred by Halo 3's launch, the 360 sold the most out of any hardware platform, with its 528,000 systems nearly doubling sales from a month prior. But even the Wii's second place at 501,000 consoles sold set a record... Read more

Xbox head Robbie Bach confirmed to the Financial Times that the rumored Xbox 360 Arcade SKU will be replacing the existing Core model. The $279 SKU is already available at some retail outlets and includes an HDMI port, wireless controller, 256MB memory card, and five Xbox Live Arcade games: Boom-Boom Rocket, Pac-man, Uno, Feeding Frenzy, and Luxor 2.

"Arcade becomes [for us] the ability to bring in a new set of audiences. They're probably a little bit more casually focused, they're looking for a new family experience or they're more price focused," Bach said.

Though the Arcade model does not include an HDMI cable, it features an HDMI output, making all models of the Xbox 360 now HDMI compatible. Microsoft's Xbox.com website has not yet been updated to include the new model.

A listing for the rumored $399 40GB backward incompatible PlayStation 3 SKU has appeared in Target store scanners, according to images from Gaming Bits. The news comes after documents that surfaced earlier this month from fellow retailer Best Buy referencing the $399 model as retailing on October 28.

The new baseline 40GB models have already been announced for Europe, Japan, and Australia. All the 40GB models announced thus far lack backward compatibility, have only two USB ports as opposed to four, and don't have any of the flash memory card slots of previous models.

The North American model is rumored to be bundled with a Blu-ray disc of Spider-Man 3, which retails October 30. The announcement of the 40GB model in Europe was coupled with a price drop for the 60GB version in those territories, so it's possible the announcement of the 40GB SKU for North America will be paired with a price cut on existing models as well.

Confirming what many had already assumed, Nintendo senior marketing VP George Harrison told Reuters the company's Wii console will remain at its $249.99 price point for some time.

"We'll stay at $249 for the foreseeable future. We are still selling everything we can make," Harrison told Reuters. "We think we're in a great position. Both our competitors took price reductions and it hasn't stalled our momentum at all."

Microsoft's Xbox 360 just had its first price cut earlier this year, nearly two years after its launch. Competitor Sony has been mainly shuffling prices for its SKUs less than a year after the PlayStation 3's release, with the most recent coming in the form of a stripped down baseline package that leaves out backward compatibility, currently announced for Europe and Australia.

With the Wii's incredible performance at retail combined with its relatively low price point, it's extremely unlikely Nintendo would issue any sort of pricing cuts before even the next holiday season. The company expects to produce 16.5 million Wii units worldwide in the coming fiscal year, which likely won't meet the demand for the console.

Rumored to be leaving the company since Nintendo announced the upcoming relocation of its sales and marketing offices, long-time marketing VP Perrin Kaplan confirmed her departure from Nintendo of America today to Reuters. Kaplan will leave the company at the end of the year when Nintendo of America's marketing offices move from the company's headquarters in Redmond to offices in the Bay Area and New York.

Kaplan is the last of three long-standing marketing executives at Nintendo to confirm her departure from the company, following announcements from senior marketing VP George Harrison and corporate communications director Beth Llewelyn. Harrison announced his leave first, but will remain with Nintendo until the end of the year, while Llewelyn left at the end of September following an announcement a week prior.

Like Harrison, Kaplan has worked at Nintendo for 15 years, giving the trio of marketers 42 years of service to Nintendo between the three of them.

In a move that may be an attempt to match Microsoft's entry into in-game advertising, Sony Computer Entertainment America today revealed its establishment of a new arm dedicated to in-game ads. The unit is to be headed by Darlene Kindler, formerly an executive of Google-owned Adscape Media. Kindler has also served at defunct hardware manufacturer 3dfx as well as at Nintendo of America, where she established the company's European distribution arm.

According to Sony, Kindler will be "responsible for SCEA's in-game advertising strategy across all PlayStation platforms including PlayStation Network." SCE London Studio's virtual world Home (PS3) may be an early focus. The upcoming free software is said to contain many purchasable consumables, and is ripe for product placement via billboards, posters, and ads on in-game televisions.

Recent examples of in-game ads and the extra revenue it brings include the Xbox 360 and PC versions of various EA titles, the PC version of Splash Damage's Enemy Territory: Quake Wars and Flagship Studios' Hellgate: London (PC).

The divergence of campaigns between different platform versions of certain games might be a catalyst for Sony's push into the area. Microsoft's Massive has secured prominent dynamic in-game ads for the Xbox 360 version of Neversoft's Guitar Hero III, while the PS2, PS3, and Wii versions lack such integration.

Ads have been met with mixed reactions, though there has been little mass outcry. "The prevalence of ads will be determined by their effectiveness and by gamer acceptance--and for all the discussion and whining that goes on, there hasn't been much genuine resistance," Shacknews' Steve Gibson wrote recently.

Shares of Kyoto-based game giant hit a record high today at 64,800 yen ($560) after being given a "buy" rating by analyst firm Goldman Sachs, Reuters reports. The analysts said Nintendo's financial situation could make its stock emulate the rise of Cupertino-based iPod maker Apple.

"We believe Nintendo's talent in creating new markets, evident from the launch of the DS and Wii, could bring it close to the level of Apple, whose high valuations are due in large part to its innovative business model," Goldman said, according to Reuters.

There's speculation Nintendo may raise its earnings forecast a second time for the current fiscal year, which may have helped drive demand for the stock. Last week, Nintendo became Japan's second-most-valuable active stock on the Tokyo Stock Exchange.

When Microsoft declared Halo 3's $170 million launch the "biggest entertainment launch in history," the company claimed to have surpassed both Spider-Man 3's box office record and the latest Harry Potter novel's first day at retail. It turns out Master Chief's latest outing might not have dethroned the latest Potter party after all, as J.K. Rowling's "Harry Potter and the Deathly Hallows" could have made anywhere from $149.3 million to $290.4 million, according to MarketWatch.

Microsoft based its victory assumption on a $166 million estimate of Deathly Hallows day-one sales cited in The New York Times and elsewhere, but a Scholastic book rep told MarketWatch this figure wasn't official. The publisher says it sold 8.3 million copies of the book in its first 24 hours at retail, but won't disclose its revenues. MarketWatch got its estimated range of launch-day sales from the book's variety of retail prices, which spanned from $17.99 to the suggested retail price of $34.99.

Though it's kind of a silly issue, it's one of those things that sheds light on the bizarre world of video game fandom. Book readers couldn't care less if a publisher made tons of money on a recent novel, and Scholastic doesn't really have a reason to come out and declare itself champion of something like earning gobs of money on a product's launch day. Video game fans actually know the figure offhand, and are sometimes rewarded for this knowledge.