Can Viacom Draw in the Young Crowd?
Associated Press
Sep 04, 2009
NEW YORK - Those of a certain age may still have affection for the mop-top Fab Four, but will the video game demographic go for The Beatles? One analyst has his doubts, a potentially bad sign for Viacom Inc.'s forthcoming "The Beatles: Rock Band."
Caris & Co. analyst David Miller trimmed a penny from his earnings per share estimate for Viacom's fourth quarter Thursday. He now expects 68 cents, compared with an average forecast of 75 cents, according to Thomson Reuters.
Miller raised several concerns about the new game.
First, it hinges on "music which certainly has its place in the heart of baby boomers, but may not be as appealing to young males 18-25." That is, the people who spend the most money on gaming.
Miller is also worried about profit margins.
"Unlike Rock Band's first iteration, the Beatles version available for sale next Wednesday will encompass all three major gamer platforms all at the same time," he noted, "requiring massive upfront promotional costs. And that's on top of rights costs to the music."
The weak economy may also hurt sales, Miller added, as well as competition from "Guitar Hero 5" from Activision Blizzard Inc.
Shares of Viacom, which is controlled by billionaire Sumner Redstone, declined 8 cents to $25.31 in midday trading.
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Copyright 2009 by Associated Press
