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October 20, 2006

That’s show biz!

Posted by David Hunter at 9:05 PM ET.

Michael Fleming at Variety reports that the deal (announced a year ago) for a film version of Microsoft’s Halo video game has apparently come a cropper:

It’s game over for Universal’s and Fox’s participation in the feature adaptation of Microsoft’s “Halo.”

Both of the studios that agreed to co-finance the screen adaptation of the popular Microsoft game have abruptly backed out of the picture. While rumors had the studios concerned over a budget that was rising above the original projected $135 million pricetag, the filmmakers said the double defection came after U and Fox played hardball and unsuccessfully tried to get the filmmakers and Microsoft to reduce their profit participation.

The studios made the pay cut demand as a Oct. 15 deadline approached. On that day Microsoft was to have received the bulk of a promised $5 million upfront payday. Software giant also stood to receive 10% of gross for rights to the game and a script by Alex Garland.

There’s more insider gossip by following the link, but Microsoft is reportedly in talks with other distribution partners. Relieved shareholders will note that Microsoft is not self-financing this venture and that, at worst, films usually never manage to do lasting damage to the underlying brand.

And what would a tale of Microsoft in Wonderland be without a mention of Viva Pinata, Microsoft’s attempt to build a younger (ages 6-11) Xbox 360 demographic, with a combination of a video game (“most important Xbox 360 release of the year“), TV show, and kiddie merchandise. This unique effort got a goofy puff piece in the Wall Street Journal this week where Microsoft is identified as a “Silicon Valley giant” and the full force ad strategy is described as “viral marketing”, but here’s the nut:

The broad push behind the piñatas is now coming into full view. New TV ads for game and the Xbox 360 start airing this week that feature a purple and green piñata horse named Horstachio trying to persuade a group of children to let him down from a tree. The segments are part of Xbox 360′s big holiday campaign that promotes game titles and the console on TV, in print and online.

The heart warming premise being, of course, that Horstachio is begging the kids not to bash him open with bats like other pinatas, but I digress.

The campaign is the first salvo in what is likely to be one of the biggest holiday ad battles in years. Xbox 360 ads will begin airing just weeks before rivals Sony Corp.’s PlayStation and Nintendo Co. launch massive ad efforts to hype their new consoles, the PS3 and Wii, respectively. Microsoft plans to spend about $50 million on its holiday push, according to a person familiar with the matter. Analysts and ad executives expect videogame makers to spend about $100 million between them promoting consoles and game titles during the fourth quarter.

Horstachio’s starring role in the Xbox 360 ad campaign is a direct assault on Nintendo’s territory, which has dominated games for young children. “Clearly Nintendo has owned that space,” says Jeff Bell, corporate vice president of global marketing for Microsoft Interactive Entertainment. “But we are now going after that space.”

Hit the link for more details than you likely want, but there are some odd off notes like some of the merchandise not appearing for a year and how they are trying to create a children’s TV show to promote all this kid bling without running afoul of children’s TV advertising regulations.

I continue to be frankly dubious about the whole premise, but if there’s a saving grace it’s that the Viva Pinata game seems to be getting good pre-reviews. Still, it doesn’t seem like a real kid’s game, but more like a kid’s game designed by and for adult geeks. The game ships in November.

Filed under Coopetition, General Business, Marketing, Microsoft, Nintendo, Public Relations, Sony, Xbox

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2 Responses to “That’s show biz!”

  1. Deals, deals, deals -- Microsoft News Tracker Says:

    [...] Microsoft’s Halo video game based movie that went on the rocks when Universal and Fox withdrew their funding has been indefinitely postponed: Microsoft Corp. on Tuesday said the company and the Oscar-winning team behind “The Lord of the Rings” films have postponed “Halo” — the movie based on Microsoft’s popular alien shoot-up video games. [...]

  2. Microsoft draws an Xbox 360 line in the sand -- Microsoft News Tracker Says:

    [...] In advance of the imminent console releases by Sony and Nintendo, Microsoft this week launched new high profile Xbox 360 games for the holidays: Viva Pinata (supposedly the “most important Xbox 360 release of the year“) and Gears of War, a much more likely candidate for being the Xbox 360 franchise game. Meanwhile, Microsoft is sticking by their Xbox 360 forecast: Peter Moore, vice president of Microsoft’s entertainment and devices division which oversees Xbox, confirmed the company’s expectation that Xbox 360 shipments would reach 10 million by the end of 2006, and 13 million to 15 million by the end of its 2007 fiscal year. [...]

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