Modern Warfare 2 DLC to make $140m - analyst

Broadpoint AmTech analyst Ben Schachter has put the possible revenues for Activision from Modern Warfare 2 DLC at USD 140 million as the publisher looks to generate a long tail.

He arrives at that figure by comparing the estimated revenues generated from last year's title, Call of Duty: World at War, based on the sales of map packs across 2009, and factoring in total unit sales of Modern Warfare 2 of between USD 14-16 million, reports IndustryGamers.

"Call of Duty DLC can be a solid contributor to Activision's 2010 EPS," he wrote. "As with the last two CoD titles, the game itself should maintain its USD 60 launch price until the next iteration (due in large part to the value of its online gameplay), but Activision will also benefit significantly from the high-margin DLC potential enabled by the packaged product's success.

"We estimate that Activision will generate at least USD 100-140 million in gross revenue from Call of Duty DLC in 2010. After paying the platform holders an estimated 30 per cent, this should generate roughly USD 59-85 million in EBIT and contribute 4-5 cents to EPS."

And in keeping with the company's decision to position the main game at a higher SRP than other titles, Schachter believes that the DLC will also be priced above average.

"Though the company has not announced anything, we would not be surprised to see the content expand significantly beyond simple map packs to include new missions, modes of play, and in-game items (who wouldn't pay for a night-time desert assault mission, a 2x2 capture the flag mode, or a very, very sharp bowie knife?) The point is that Call of Duty's fan base will pay for additional content, and we expect Activision's Infinity Ward to monetize that throughout 2010," he said.

Activision revealed that Modern Warfare 2 had grossed USD 550 million in its first five days on sale - a new entertainment industry record.