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Author Topic: The "Shenmue just wasn't a financial success" Argument  (Read 49680 times)

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Offline LagunaVII

The "Shenmue just wasn't a financial success" Argument
« on: July 07, 2014, 07:26:48 PM »
'Shenmue just wasn't a financial success' or similar responses is often what us fans are greeted by when we discuss our needs for Shenmue 3 and while there are often conflicting sources and information about how much money was spent on Shenmue, was it a financial failure?

The cost for production of Shenmue has often been debated, I myself heard it cost upwards of $80,000,00. Where as Yu Suzuki has stated I believe it cost as little as $40,000,000. What, I think, has always been constant though is that the figures quoted were for the entire series! That's chapter 1 through 16 (or 11 as recent interviews with Suzuki would suggest)

It has often been said that Dreamcast owners would have to buy 3 copies of the game just for the game to have made a profit, or two depending on which website you are going to source. Clearly we have some mixed information.

A quick internet search shows that the Dreamcast shipped 10.6 million units. I don't know how much games cost in 1999 in the US, However one thing about video games, is there price has remained pretty consistent forever and have not been increased with inflation. I've been paying around £40 for new games for years. A quick search shows a new Xbox One game ships for $60. Using the figure of $60 a game and the 10 million Dreamcast's sold, its clear to see that every owner did not need to buy it twice. Off course I am aware that not all the money made from sales go direct to the publisher and if I knew the % that went to the Retailers, Wholesalers, Etc I'd gladly work it out proper.

Unfortunately, Shenmue did not sell to every Dreamcast owner, in fact the sales figures were 460,000 in the US alone  - based on the $60.00 price tag that's still $27,600,000! Worldwide, Shenmue was one of only six games for the Dreamcast to break 1 million sales with a total of 1,180,000 units sold worldwide. Nights into Dreams only sold 430,000 but no one ever seems to call that a failure. Again lets use the $60 price tag. For a total income of $70,800,000!! Again this does not take into account retailers profits, wholesalers profits or for that matter the exchange rate between dollars and pounds, dollars to Yen etc. Still $70,800,000 is very close to the higher of the quoted development cost, and we haven't even factored in the sequel yet!

I, unfortunately, have been having trouble pulling the sales figures for Shenmue II. I know it sold well in England especially as the US imported it, I also believe it sold very well in Japan though as I say. I do not have any figures to back it up. One thing that is known however is that it sold poorly on Xbox, was this because of the previously mentioned importation of Dreamcast versions? Who knows. But its safe to say I think that is sold enough over the two consoles to push the overall income over $80,000,000.

In fact, I think it is probably safe to assume that the game pretty much broke even or was close to, the money everybody says Shenmue lost was not in fact due to Shenmue, but rather the money Sega was bleeding from the Dreamcast.

Which now begs the question: If the original budget was for all chapters for the Shenmue saga, and there is currently gigabites of character models, locations, research, story all sat on a Sega Server somewhere as the rumours would suggest, Why, oh why, have these assets not been ported to a newer console in either a HD I + II or the elusive III - especially when recent reports suggest a game such as The Witcher 3 only cost $15,000,000 to develop?

Anyway, all this I suppose is subjective and speculation, I cant be sure on the amount of money Shenmue cost to make or its Sequel for that matter, nor can I be sure on the total amounts sold! But I will say this: Based on the sales figures 1 in 10 Dreamcast owners owned Shenmue and the Dreamcast, as we know, was a very easy system to pirate! I wouldn't be surprised if at least 2 of the remaining  9 of 10 customers pirated the game.

No, the 'Shenmue wasn't a Financial Success' or the 'Shenmue wasn't a popular game' just doesn't hold water for me! Especially when you look at the information available to us. No Shenmue was in fact successful, not as successful of the saviour game they wanted it to be, but still far from a flop people make it out to be.

Offline Shenmue Stare

Re: The "Shenmue just wasn't a financial success" Argument
« Reply #1 on: July 07, 2014, 09:25:22 PM »
Absolutely. I think most people when talking about Shenmue failing mean the Xbox iteration. You're only as good as your last movie, game, etc.  I'm not sure about the game industry, since the budget's are so all over the place, but a general rule of thumb for movies is that it needs to make back 4 times its budget to make profit, but a chunk of that is due to the theater chains fudging the books to get their cut. Games are a little more cut and dry since they're just sold to retailers wholesale.In general, though, games are way more expensive than movies.

Offline Shenmue Stare

Re: The "Shenmue just wasn't a financial success" Argument
« Reply #2 on: July 07, 2014, 09:25:41 PM »
If I remember rightly, long ago I've read that your average game nets the game publisher between 15 and thirty bucks a copy. So Shenmue definitely didn't recoup the budget, but then again, there were supposed to be 5 or 6 games, and had they saw fruition, would have certainly brought in profit. Look at Assassin's Creed. I remember when the first game came out, it got middling "8" reviews pretty much across the board, and thus sales suffered. Ubisoft even made a statement on how it didn't sell very well. Lo and behold, they stuck with the series and have henceforth made plenty of profit on it.

Offline Shenmue Stare

Re: The "Shenmue just wasn't a financial success" Argument
« Reply #3 on: July 07, 2014, 09:26:12 PM »
Shenmue was also a killer app. Had the Dreamcast not been announced dead 2 months after Shenmue came out, the game would have sold millions more copies. Undoubtedly.

Offline Shenmue Stare

Re: The "Shenmue just wasn't a financial success" Argument
« Reply #4 on: July 07, 2014, 09:26:52 PM »
And yes, I split up my post in order to milk more yen for capsule toys, hahaa. ;D

Offline LagunaVII

Re: The "Shenmue just wasn't a financial success" Argument
« Reply #5 on: July 07, 2014, 09:34:54 PM »
Thats my point, i did mention that my post was pure speculation and estimates based on the information I could find on the internet, who knows I could have been wrong - but the only definitvie information I did find was that the budget was for the entire Saga, not Shenmue I so when people see the $70 mil price tag and the sales Shenmue I made - they dont see the numbers balancing - which to be honest they wont considering the fact that there was money spent on assests that are yet to be used.

Offline LagunaVII

Re: The "Shenmue just wasn't a financial success" Argument
« Reply #6 on: July 07, 2014, 09:41:57 PM »
I dont think over one million is sales constitutes a flop esp considering that it came out after the death the dream cast.
As I say its unfortunate I could not get difinitve numbers for the actual sales of Shenmue II as i would have really liked to have seen the ball park figure we would be playing with.
You are probably right, given the wholesale costs, retail costs... Shenmue probably didnt break even. however look at what we had to deal with
Shenmue i coming out after the death of the dreamcast
Shenmue II (dc) only being released in Jap and Eur
Shenmue II (Xb) having delays, and being released on a console that not yet had it popularity (also people had already inported Shenmue II)
I stand by what I said - It was by far not the finacial disater in which people make out, nor was not as popular as people make out. Im sure Sega and Microsoft would have liked it to have made more money, but the fact is both parties screwed up along the way 

Offline The Hazuki Legacy

Re: The "Shenmue just wasn't a financial success" Argument
« Reply #7 on: July 07, 2014, 11:08:43 PM »

Offline LagunaVII

Re: The "Shenmue just wasn't a financial success" Argument
« Reply #8 on: July 07, 2014, 11:28:51 PM »
Haha that picture pretty much says it all doesnt it :D
Anyway - some further numbers for you, though this one is a bit like comparing apple and oranges.... The total sales off the PS2 was 155 Million units. MGS2 Sold 7 million units which means 1 in 22 PS2 users had a copy of MGS2 a bit less than shenmues 1 in 10 ;) Still as I said I know its comparing apples and oranges, but still when you look at it like this, you can actually see the game did sell

Offline jameswalker85

Re: The "Shenmue just wasn't a financial success" Argument
« Reply #9 on: July 09, 2014, 06:08:31 PM »
When Shenmue was developed, it was ground-breaking. So much so that open-world wasn't even a genre, hence why it was dubbed "FREE". Now that open-world games are a dime a dozen, Shenmue III would not cost that much. Hell, they could even use Yakuza as a starting point.

Offline James

Re: The "Shenmue just wasn't a financial success" Argument
« Reply #10 on: July 31, 2014, 06:03:09 AM »
An old campaign article on this very subject, a month after Team Yu began:

Offline Matt Oliver

Re: The "Shenmue just wasn't a financial success" Argument
« Reply #11 on: July 31, 2014, 11:14:38 PM »
Budget does play a part. The issue is it is seen by businessmen as a failure due to the fact it did not even cover costs.

It was a success for us gamers as it was something very new and unique. Now the open world thing has been done and done. This does not in my opinion have an effect on Shenmue 3 or beyond as the Shenmue story is so strong.

Dev costs won't be as much as the basic research etc is all there and they can use pre-existing engines to run the game.

Offline Son ALA

Re: The "Shenmue just wasn't a financial success" Argument
« Reply #12 on: August 25, 2014, 12:33:02 AM »
I also remember reading that from the 70 million price tag, around 20 million was for advertising. (Something that sega never does anymore) So 70 to 80 million for 2 games and all the promotional stuff. I also wonder how much of that money also covered Yu's vacations/research around asia where he was so closely studying the areas for shenmue.

Then for the xbox numbers.  XBOX was my console of choice and its up there with the DC for being my favorite console ever but those low numbers for shenmue 2 should have an asterisk since there were so many factors working against it.

We have a console generation where the gap in graphics have never been so huge but while the xbox was the powerhouse, it was still the new kid on the block so everyone was on the ps2. Then Shenmue 2 was released on the Xbox but only in NA and then when it hit Europe it was English only and they alreadynhad their DC version.

It's like Shenmue really had the worst luck ever. It debuted on a console way ahead of its time, so much to offer but failed instantly the moment PS2 announced DVD. The DC didn't even last half the generation.  Then the game gets revived on the xbox but only for limited region release that also was also dominated by the ps2. So we had a small install base that was being filtered leaving an even smaller shenmue fan base  on the xbox.

In high school I was 1 of 3 people who had one and then 2 other kids I didnt know had it.  Then by the summer I managed to get my cousin and 2 more friends to jump over. I personally new 6 guys with an xbox by the time shenmue came out,  11 months after the console debuted. 3 of us bought shenmue since we had it on the dc too.

« Last Edit: August 25, 2014, 12:36:40 AM by Son ALA »

Offline Guppy

Re: The "Shenmue just wasn't a financial success" Argument
« Reply #13 on: August 28, 2014, 07:16:34 AM »
I asked someone the other day about do u  know Shenmue? She asked. Wots that? This was in my local game.
( shes loves playstation )
Guy says.. It was a dreamcast game.
O yes she says i remember gettin sonic adventure and chu chu rocket, funny how alot of pple didnt knowabout shenmue bk in the day.
Same with original xbox. U dont know shenmue? But u had a xbox??