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[LEAK] Licensing Terms between Sony and Marvel for Wolverine exclusivity

Thick Thighs Save Lives

Thick Thighs Save Lives

NeoGAF's Physical Games Advocate Extraordinaire
Those HW bundles royalty fees are šŸ˜µā€šŸ’«.

9VJHnAF.png


Mowcno said:
In-case people aren't understanding, Insomniac aren't getting 35-50% of the Hardware bundles revenue, the calculation given afterwards show the number is then cut by the percentage based on the agreed fee for the bundled game. I don't know the wholesale price of consoles but basically the fee's are going to look like this if we just use retail prices instead.

$70 Physical Game: Between $13.30 and $18.20 goes to Marvel
$70 Digital Game: Between $6.30 and $12.60 goes to Marvel
$500 Console Bundled with Physical Game: Between $33.25 and $65.00 goes to Marvel
$500 Console Bundled with Digital Game: Between $15.75 and $45.00 goes to Marvel

"number of units x wholesale bundle price x applicable royalty rate for bundle x applicable royalty rate for game"

EG for max possible bundle with physical game fee: 1 x $500 x 0.5 x 0.26 = $65

It is written in a confusing way that makes it seem that the 35%-50% is the final result after the calculation they specify but this obviously can't be the case. For one if the 35-50% isn't the "applicable royalty rate for bundle" in the calculation then they don't state it anywhere which would be a very strange piece of information to omit. Secondly it's just common sense that there is no way Sony is giving away $250 for selling a $500 console. If that was the case they would be losing a gigantic amount of money on hardware. Operating profit would be completely in the toilet every time a Marvel game is bundled so they just wouldn't bother bundling them.
Click to expand...
 
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Mownoc

Mownoc

Member
Banjo64 said:
Will be interesting to see if their Xmen game sells 6m. Thatā€™s not the loftiest target but IMO Xmen doesnā€™t have the same mainstream appeal as Spider-Man.
Click to expand...
Well how much do you think Wolverine will sell? Because the X-Men game will obviously heavily feature Wolverine.

Sure he's not as popular as Spiderman but I'll be surprised if these games only sell 6m.
 
VulcanRaven

VulcanRaven

Member
Those exclusivity terms are interesting. There is probably same kind of deal with Spider-Man. If there is does it mean that Disney/Marvel can't re-release the old PS1 and 2 games without Sony's permission? Sad if Sony could just block re-releases of Ultimate Spider-Man and the PS1 Neversoft game.
 
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YOU PC BRO?!

YOU PC BRO?!

Gold Member
Sad to see exclusivity rights to the X-Men on PlayStation. Obviously that has only left certain characters available to Microsoft for their own licences games I.e. Blade.

Iā€™m assuming that this is conformation that there will be an X-Men game coming at some stage?
 
Mownoc

Mownoc

Member
Thick Thighs Save Lives said:
Those HW bundles royalty fees are šŸ˜µā€šŸ’«.
Click to expand...
In-case people aren't understanding, Marvel aren't getting 35-50% of the Hardware bundles revenue, the calculation given afterwards show the number is then cut by the percentage based on the agreed fee for the bundled game. I don't know the wholesale price of consoles but basically the fee's are going to look like this if we just use retail prices instead.

$70 Physical Game: Between $13.30 and $18.20 goes to Marvel
$70 Digital Game: Between $6.30 and $12.60 goes to Marvel
$500 Console Bundled with Physical Game: Between $33.25 and $65.00 goes to Marvel
$500 Console Bundled with Digital Game: Between $15.75 and $45.00 goes to Marvel

"number of units x wholesale bundle price x applicable royalty rate for bundle x applicable royalty rate for game"

EG for max possible bundle with physical game fee: 1 x $500 x 0.5 x 0.26 = $65

It is written in a confusing way that makes it seem that the 35%-50% is the final result after the calculation they specify but this obviously can't be the case. For one if the 35-50% isn't the "applicable royalty rate for bundle" in the calculation then they don't state it anywhere which would be a very strange piece of information to omit. Secondly it's just common sense that there is no way Sony is giving away $250 for selling a $500 console. If that was the case they would be losing a gigantic amount of money on hardware. Operating profit would be completely in the toilet every time a Marvel game is bundled so they just wouldn't bother bundling them.
 
Last edited:
StreetsofBeige

StreetsofBeige

Gold Member
Mowcno said:
In-case people aren't understanding, Insomniac aren't getting 35-50% of the Hardware bundles revenue, the calculation given afterwards show the number is then cut by the percentage based on the agreed fee for the bundled game. I don't know the wholesale price of consoles but basically the fee's are going to look like this if we just use retail prices instead.

$70 Physical Game: Between $6.30 and $12.60 goes to marvel
$70 Digital Game: Between $13.30 and $18.20 goes to marvel
$500 Console bundled with Physical Game: Between $33.25 and $65.00 goes to marvel
$500 Console Bundled with Digital Game: Between $15.75 and $45.00 goes to marvel

"number of units x wholesale bundle price x applicable royalty rate for bundle x applicable royalty rate for game"

EG for max possible bundle with physical game fee: 1 x $500 x 0.5 x 0.26 = $65

It is written in a confusing way that makes it seem that the 35%-50% is the final result after the calculation they specify but this obviously can't be the case, for one if the 35-50% isn't the "applicable royalty rate for bundle" in the calculation then they don't state it anywhere, which would be a very strange piece of information to omit. Secondly it's just common sense that there is no way Sony is giving away $250 for selling a $500 console. If that was the case they would be losing a gigantic amount of money on hardware. Operating profit would be completely in the toilet every time a Marvel game is bundled so they just wouldn't bother bundling them.
Click to expand...
I was too lazy to figure that out. But it makes no sense it's $250 of a $500 bundle. That fine print formula I didn't feel like doing mental math.

But looking at your bullet points, why would a physical game be less royalty money than digital for Marvel, but for a physical bundle set Marvel gets more royalties?
 
Last edited:
Mownoc

Mownoc

Member
StreetsofBeige said:
I was too lazy to figure that out. But it makes no sense it's $250 of a $500 bundle. That fine print formula I didn't feel like doing mental math.

But looking at your bullet points, why would a physical game be less royalty money than digital for Marvel, but for a physical bundle set Marvel gets more royalties?
Click to expand...
My bad, I had the royalties the wrong way round for the $70 games.
 
Mibu no ookami

Mibu no ookami

Demoted MemberĀ® Proā„¢
YOU PC BRO?! said:
Sad to see exclusivity rights to the X-Men on PlayStation. Obviously that has only left certain characters available to Microsoft for their own licences games I.e. Blade.

Iā€™m assuming that this is conformation that there will be an X-Men game coming at some stage?
Click to expand...

It was obvious that Wolverine was a first step to an X-Men game.

Microsoft missed the boat on this and with the quality of their game releases, Marvel was never going to trust them with top IP out of the gate.

We've already seen Avengers and they'll be on ice for a few years probably.

All that is left really is Fantastic Four and they'll probably wait to put out a movie first to breath life into the IP.
 
VulcanRaven

VulcanRaven

Member
Mibu no ookami said:
It was obvious that Wolverine was a first step to an X-Men game.

Microsoft missed the boat on this and with the quality of their game releases, Marvel was never going to trust them with top IP out of the gate.

We've already seen Avengers and they'll be on ice for a few years probably.

All that is left really is Fantastic Four and they'll probably wait to put out a movie first to breath life into the IP.
Click to expand...
I wonder how much exclusivity for Batman would cost. I'm suprised MS hasn't tried that.
 
Last edited:
U

Unknown Soldier

Member
Sony committing $120M per game to development costs is pretty wild and giving Marvel on average 20% of sales revenue is a pretty sweet deal for Marvel. Marvel doesn't have to do shit and gets 20% just for letting Sony use these licensed characters.

It's a good thing these Marvel games sell very well because break-even for Sony is pretty formidable. Sony starts out around $160M in the hole per game released and must make at least $160M / 0.8 = $200M in revenues to reach break even based on back of envelope calculations. Assuming $70 per game, and making a big assumption that 100% of sales are at full price which is of course not possible, then the minimum number of copies sold starts around ~2.8M sold at full price to just break even. Obviously the real required number of copies sold is much higher since only release copies are sold at $70. Without knowing the exact ASP for each game, I would just ballpark it and say anywhere between 3-4M copies sold at variable pricing to break even.

This deal is pretty great for Marvel, and kind of rough for Sony. I'm starting to see why Microsoft turned Marvel down when they were approached first even though Microsoft is quite literally almost worth $2.8 trillion, which is more than 20 times what Sony is worth by market cap. It's not an exaggeration to say that Sony basically don't directly profit financially from the Marvel titles, rather the benefit to Sony is ensuring the Playstation platform's continued overall success by having these popular games exclusive to Playstation.
 
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Mibu no ookami

Mibu no ookami

Demoted MemberĀ® Proā„¢
VulcanRaven said:
I wonder how much exclusivity for Batman would cost. I'm suprised MS hasn't tried that.
Click to expand...
It would cost a lot. Microsoft's problem is that they can't reach an IP owner's desired sales goals. That's why they're stuck with Blade.

Marvel doesn't care if it flops because they'll be getting paid either way.

It's no mystery as to why Xbox hasn't had any major 3rd party exclusives this generation.

Imagine your IP can't sell at all in Europe and Asia, and even in the US a large sum only wants to play on GamePass.

They've destroyed that brand.
 
64bitbros

64bitbros

Member
Mibu no ookami said:
It was obvious that Wolverine was a first step to an X-Men game.

Microsoft missed the boat on this and with the quality of their game releases, Marvel was never going to trust them with top IP out of the gate.

We've already seen Avengers and they'll be on ice for a few years probably.

All that is left really is Fantastic Four and they'll probably wait to put out a movie first to breath life into the IP.
Click to expand...
Pretty much. What would you rather have? All X-Men.... or Indiana Jones?
 
64bitbros

64bitbros

Member
ArĀ¢tos said:
Indiana Jones... But probably neither knowing Indy will be turned into either a FPS or a "modern" action game.
Click to expand...
Really? Its an old irrelevant IP at this point? Its last successful movie was 1989. Crystal Skulls was hated, and the last movie bombed (even though i liked it).
 
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Mibu no ookami

Mibu no ookami

Demoted MemberĀ® Proā„¢
64bitbros said:
Pretty much. What would you rather have? All X-Men.... or Indiana Jones?
Click to expand...

No brainer for sure.

Robb said:
Those royalty fees are way higher than I wouldā€™ve guessed tbh. Disney making bank.
Click to expand...

People wondered why Microsoft declined. I'm sure the deal for Spider-Man was similar to the deal for Wolverine/X-Men.

Just look at the development cost commitments and the number of games they need to sell to keep the deal going. Microsoft can not confirm 6 million units sold. There's just no way.


What should have people concerned here is that the commitment is really for 4 games between now and 2035... 4 games in 11 year is quite a bit.

I'm sure that one of these is going to be a live service game.
 
TGO

TGO

Hype Train conductor. Works harder than it steams.
That explains the Spider Man 2 Collectors Edition
 
ArĀ¢tos

ArĀ¢tos

Member
64bitbros said:
Really? Its an old irrelevant IP at this point? Its last successful movie was 1989. Crystal Skulls was hated, and the last movie bombed (even though i liked it).
Click to expand...
It's not superhero stuff, enough for me to prefer it. Can't stand superhero things, regardless of being Marvel or DC or whatever.
 
Tiago Rodrigues

Tiago Rodrigues

Member
Banjo64 said:
Will be interesting to see if their Xmen game sells 6m. Thatā€™s not the loftiest target but IMO Xmen doesnā€™t have the same mainstream appeal as Spider-Man.
Click to expand...
An Xmen game will sell 6M with ease by the time it releases close to the end of this gen / early next gen. By then the PS5 will be at like 120M units and PS6 will be out.
 
Mibu no ookami

Mibu no ookami

Demoted MemberĀ® Proā„¢
DenchDeckard said:
There is no way it means 35 - 50 percent of the whole cost of the retail hardware box right?
Click to expand...

The formula is in the graphic. The only thing we don't know is what would cause the rate to be on the higher or lower end of the ranges given.

It's not up to 35-50% of the entire bundle price.
 
Mibu no ookami

Mibu no ookami

Demoted MemberĀ® Proā„¢
Tiago Rodrigues said:
An Xmen game will sell 6M with ease by the time it releases close to the end of this gen / early next gen. By then the PS5 will be at like 120M units and PS6 will be out.
Click to expand...

For frame of reference:

Infamous Second Sons sold 6 million copies and Detroit Becomes Human sold 5.5 million copies.
 
Topher

Topher

Identifies as young
64bitbros said:
Oh i can totally see it from a personal preference. I just think mainstream-wise X-Men is far more valuable. Someone might prove me wrong, but thats how i see it.
Click to expand...

I think in either case the devs are going to have to create a kickass game or the IP doesn't matter. From that perspective, I have more faith in an Xmen from Insomniac than Indiana Jones from Machine Games. Hopefully MG will surprise me though as by the time the game comes out, we will be neck deep in comic book games.
 
Mownoc

Mownoc

Member
DenchDeckard said:
There is no way it means 35 - 50 percent of the whole cost of the retail hardware box right?
Click to expand...
Correct the actual highest percentage is 13% of bundle wholesale price because the percentage is reduced based on the license fee for the bundled title, my post above breaks it down. If the fee was actually up to 50% then Sony could be better off selling a standalone PS5 for $300 than a PS5 bundled with a marvel game for $500 and the standalone would sell a hell of a lot more at that price. They'd never create a marvel bundle at those rates.

"wholesale bundle price x applicable royalty rate for bundle x applicable royalty rate for game"
EG. $500 x (35-50%) x (9-26%)

What influences whether it is the lower or higher end of the % is unknown. My guesses are some of the factors could be the age of the bundled game and if the console is a limited edition with marvel designs on the console itself.
 
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ArĀ¢tos

ArĀ¢tos

Member
64bitbros said:
Oh i can totally see it from a personal preference. I just think mainstream-wise X-Men is far more valuable. Someone might prove me wrong, but thats how i see it.
Click to expand...
Yes, Indiana Jones IP is beyond dead. It was in an stasis of irrelevance, but the last 2 movies completely killed it.
The last good Indiana Jones game was Fate of Atlantis, and a game like that nowadays would only be considered successful if made by a tiny indie team, no matter how beautiful it could look.
 
DenchDeckard

DenchDeckard

Moderated wildly
Mowcno said:
Correct the actual highest percentage is 13% of bundle wholesale price because the percentage is reduced based on the license fee for the bundled title, my post above breaks it down. If the fee was actually up to 50% then Sony could be better off selling a standalone PS5 for $300 than a PS5 bundled with a marvel game for $500 and the standalone would sell a hell of a lot more at that price. They'd never create a marvel bundle at those rates.

"wholesale bundle price x applicable royalty rate for bundle x applicable royalty rate for game"
EG. $500 x (35-50%) x (9-26%)

What influences whether it is the lower or higher end of the % is unknown. My guesses are some of the factors could be the age of the bundled game and if the console is a limited edition with marvel designs on the console itself.
Click to expand...

Thanks for the breakdown.

Marvel making bank on their IP, that's for sure.
 
Thick Thighs Save Lives

Thick Thighs Save Lives

NeoGAF's Physical Games Advocate Extraordinaire
Mowcno said:
In-case people aren't understanding, Insomniac aren't getting 35-50% of the Hardware bundles revenue, the calculation given afterwards show the number is then cut by the percentage based on the agreed fee for the bundled game. I don't know the wholesale price of consoles but basically the fee's are going to look like this if we just use retail prices instead.

$70 Physical Game: Between $13.30 and $18.20 goes to Marvel
$70 Digital Game: Between $6.30 and $12.60 goes to Marvel
$500 Console Bundled with Physical Game: Between $33.25 and $65.00 goes to Marvel
$500 Console Bundled with Digital Game: Between $15.75 and $45.00 goes to Marvel

"number of units x wholesale bundle price x applicable royalty rate for bundle x applicable royalty rate for game"

EG for max possible bundle with physical game fee: 1 x $500 x 0.5 x 0.26 = $65

It is written in a confusing way that makes it seem that the 35%-50% is the final result after the calculation they specify but this obviously can't be the case. For one if the 35-50% isn't the "applicable royalty rate for bundle" in the calculation then they don't state it anywhere which would be a very strange piece of information to omit. Secondly it's just common sense that there is no way Sony is giving away $250 for selling a $500 console. If that was the case they would be losing a gigantic amount of money on hardware. Operating profit would be completely in the toilet every time a Marvel game is bundled so they just wouldn't bother bundling them.
Click to expand...
Cheers! I've added the info here to the OP.
 
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