Ubisoft looks to the Wii, Project Natal for casual gaming future

While Ubisoft CEO Yves Guillemot singled out a nosedive in the DS market as a significant contributor to his company's poor Q1 performance, he didn't condemn the growing casual gaming space or his company's increasing reliance on it. Where the DS software market is falling – Guillemot pointed to Ubi's consistent market share in Europe, despite a drop in revenue – other casual opportunities are growing. "The DS is declining quickly, but the Wii is taking off quite fast," Guillemot said. "That's why the average margin remains around 20%." So, while DS software sales dipped, Wii software was there to make up the difference. So why did a drop in DS software sales hurt so bad in the last quarter? Guillemot says Ubi's summer Q2 "is a period where people are going for holidays and they buy lots of [DS] games and because this market is going down it has a big impact on the second quarter."

With DS software sales flagging, Ubi's not without a plan to safeguard its lucrative casual franchises. Executive director of Ubisoft, Alain Corre, broke down the Wii's growth, saying, "This year we expect the Wii to represent over 40% of our sales on casual versus last year it was at 18%. So it's a big change for the Wii, and [the Wii] is contributing much more to our casual sales than the DS last year."

So Ubisoft is looking to the Wii, and beyond, for the bulk of its casual gaming sales. "The casual business is changing rapidly and it will still be a very interesting business but we have to reinvent it this year," Guillemot expained. "We already have a big shift from DS to Wii this year, and we'll continue with the Wii and the Xbox 360 with the new 3D camera next year." Of course, we've been focused on how Project Natal will work with "our" games; however, here's the CEO of a major publisher talking about the Xbox 360 (not the PS3's motion camera though?) as another prong in its successful casual strategy.