TDK Mediactive is finding it helps to have right partners as licensor DreamWorks is picking up marketing slack for its Shrek Xbox game by packing ads and promotions in 20 million Shrek DVD and VHS videos expected to ship by year-end. Marketing boost is aimed at finding ways to generate mind-share for 3rd party publisher in holiday selling season that’s likely to be dominated by heavy marketing by Microsoft and Nintendo.
Mad Catz Interactive sales from continuing operations in its 2nd quarter ended Sept. 30 jumped 51% to $15.7 million from $10.4 million same quarter year ago. Toronto videogame maker posted $324,509 (1? per share) revenue after taxes and goodwill charges, compared with $597,602 loss (-1?) year ago. Company’s full loss for year-ago quarter, including discontinued operations, was $1.8 million (-4?). Commenting on results, Mad Catz CEO Morris Perlis said: “We continue to focus on reducing expenses allowing us to achieve profitability during our lower revenue quarters.” He said that although company’s results in quarter “were solidly in the black, the slowdown in retail sales that resulted from the events of September 11 did have an impact.” But Perlis said: “We strongly believe that the growing demand for [PlayStation 2] and Game Boy Advance accessories, coupled with the upcoming introduction of Microsoft’s Xbox and Nintendo’s GameCube, should bode well for Mad Catz for the balance of the year.” He said: “If, as we believe, consumer confidence rebounds, we expect that Mad Catz will achieve the $80 million net sales estimates that analysts projected for fiscal year 2002.” Perlis said he expected company’s short-term gross margin to “be under some pressure for the balance of the year” because of increased airfreight expenses for shipments of its accessories for GameCube and Xbox and “aggressive pricing by some of our competitors on several of the new launch products.”
Growing interest in telematics products and services was evident in 2 deals announced Tues. MobileAria will partner with Sony Ericsson Mobile Communications to support and market Sony Ericsson’s Bluetooth-enabled phones with its True Hand Free service to be introduced at year-end. Service will work with consumer’s PC and MobileAria-provided cellphone, “devices people carry with them throughout the day,” and will be marketed independent of automaker, company said. Using MobileAria’s Bluetooth cellphone and telematics service, drivers can use voice commands to: (1) Read, file, reply, delete or prioritize e-mail. (2) Dial phone saying numbers or contact name. (3) Navigate through voice mail and customer service prompts. (4) Answer or hang up phone. (5) Listen to personalized headlines, sports, financial and entertainment news. Company later will roll out more services such as real-time traffic information, business location finder and real time weather, it said. MobileAria investors include Delphia Automotive, Mayfield and Palm. Separately, Ford and Qualcomm joint venture Wingcast said it would use Sun Microsystems Open Net Environment as backbone of telematics delivery network. To be unveiled in model year 2003, telematics offering will be based on Java language and will run on Sun Fire servers, company said. Sun and Wingfire will work together to create network architecture and “relevant applications.” Computer maker also will promote Wingfire services to domestic employees and “develop purchase incentive programs to help ignite industry demand,” Sun said. IDC research firm recently estimated telematics market to grow to $42 billion by 2010 from $1 billion in 1998.
Less than month after The Mummy Returns scored record retail revenue on home video release, distributor Universal Studios Home Video (USHV) bested itself with Nov. 2 release of Dreamworks’ Shrek on DVD and VHS. USHV said Tues. that animation sold more than 7 million DVDs and tapes valued at $110 million in 3 days after release. DVD version ($19.95) accounted for 2.5 million sold and is on track to become fastest-seller in DVD’s 4-1/2 year history, USHV said. Combined sellthrough was half of initial shipment to retail, studio said.
Salt Lake City professional services company SBI was tapped by Microsoft to design Xbox packaging. Microsoft also requested that SBI create online and offline brand usage guides. Microsoft Brand Mktg. Dir. Don Coyner said company picked SBI because its “designs most accurately captured the performance and power of the Xbox videogame system… SBI so thoroughly tapped into the power of the Xbox brand and the gamer mentality that we asked them to develop an Xbox brand guide that would ensure that all our internal and external communication stayed true to the Xbox brand.”
RadioShack said Oct. sales declined to $363.9 million from $371.1 million year earlier on flat same-store sales at company- owned outlets. For year to date, sales were up 2% to $3.52 billion on 2% same-store sales increase. On same-store sales for Oct., company said parts, batteries and accessories were up by mid-single digits. It said strong sales of special-purpose batteries and video accessories were negated in part by drop in computer accessories. Wireless communications rose 40% in dollars, 70% in units. Core AV category fell by high teens, with DirecTV business down 25%, mainly on decline in average selling price to $50 from $100 year ago. Personal electronics fell by mid-single digits on difficult comparisons with promotionally active Oct. 2000. RadioShack said it expected to post flat total merchandise sales for 4th quarter.
Acclaim Sports starts shipping its first title for GameCube -- All-Star Baseball 2002 -- later this week at $49.99. Title was developed by Glen Cove, N.Y., game maker Acclaim Entertainment’s Acclaim Studios Austin under license from Major League Baseball Properties and Major League Baseball Players Assn. Acclaim said it planned to ship 4 other GameCube titles through holiday season -- Crazy Taxi, Dave Mirra Freestyle BMX 2, NFL QB Club 2002, XG3 Extreme G Racing.
Rayovac said 4th quarter profit narrowed to $6.5 million from $12.7 million year as battery maker took $5.7 million charge to cover restructuring and write-down of receivables owed by bankrupt retailers. Revenue declined to $187.6 million from $191.5 million. Rayovac recorded $3.5 million charge in quarter that partly covered shutdown of 90,000-sq.-ft. factory in Wonewoc, Wis., that produced lighting products. It also trimmed 500 jobs, move it expected would generate $12-$13 million in annual savings. In addition to closing plants, work forces at Mexico City and Tegucigalpa, Honduras, which manufactured zinc carbon batteries, also were reduced. Rayovac had 3,300 employees Dec. 2000. General and administrative expenses rose to $14.4 million from $12.1 million as company took $2.7 million charge to write off receivables from retailers Ames and Pharmor, both of which are operating under bankruptcy protection. As result, accounts receivable rose to $190 million from $154 million despite decline in inventory to $91 million from $100 million. Sales in N. America declined to $143.1 million from $150.3 million year earlier, while revenue from Latin America and Europe increased 4% and 18% to $30.2 and $14.3 million, respectively. Rechargeable battery sales were up 27% but heavy-duty batteries fell $4 million. Earnings also suffered from “intense promotional environment” led by Gillette’s Duracell brand, which priced 12-pack of AA batteries at Wal-Mart at $7.97, CEO David Jones said. At Wal-Mart, Rayovac has secured coveted check-out line placement for holiday season, spot it will share with mass merchant’s private label brand, Jones said. Rayovac also signed distribution agreement with Best Buy to carry its one-hour nickel metal hydride rechargeable system, first product battery maker has sold through CE dealer. Battery sales growth is expected to slow in 2002 to 3-4% from traditional 5-7% as result of slowdown in worldwide economy, Jones said.
Soundmax SPX audio technology is available to Xbox videogame developers through Microsoft Xbox tools and middleware program, Analog Devices announced Tues. Technology already is available for developers of titles for PC and PlayStation 2. Soundmax SPX is said to reproduce realistic sound effects that change in real time in direct response to player’s input.
Family Friendly value-priced computer game maker eGames said it entered into new bank agreement with Fleet to pay off outstanding balance owed over 22 months. Langhorne, Pa., game maker said agreement also provided that, despite its defaults under loan documents that previously provided company with $2 million secured line of credit, bank wouldn’t enforce its rights and remedies under those loan documents as long as eGames remained in compliance with terms of new agreement. Under new deal, remaining outstanding balance owed under credit facility will be repaid in monthly installments with interest at prime plus 3%. EGames also issued warrants to bank for purchase of 750,000 shares of company’s common stock exercisable until Oct. 31, 2006, at exercise price of 9? per share.