Intellivision Amico - Tommy Tallarico introduction + Q&A

For those interested there will be an interview with Mike Mika (Night Stalker Reimagined) this Thursday by "The ORIGINAL Next Level Gaming".

Maybe he will talk a bit about his current projects?

I just found a couple of interesting comments in the Vara Dark interview. The first one is plain hilarious:

The second one seems a bit more serious but it appears to be lacking key information about how the financial success of the project:

Tommy (and everyone), what do you have to say? Answering the first one can probably be fun since his suggestion is so crazy, and clarifying the second with real data would also be great.

7 hours ago, fiudr said:

So? Most will just assume Amico is made-up. I did until I learned what it meant by following this thread.

 

So... I'm joking!😜

42 minutes ago, IntelliMission said:

I just found a couple of interesting comments in the Vara Dark interview. The first one is plain hilarious:

 

 

The second one seems a bit more serious but it appears to be lacking key information about how the financial success of the project:

 

 

Tommy (and everyone), what do you have to say? Answering the first one can probably be fun since his suggestion is so crazy, and clarifying the second with real data would also be great.

In the interview he said 5M units, not $5M.  That would be at least $1B in revenue (assuming lifetime sales not annual).  Regarding game development, consider small teams of four or five people working for six months, and a little bit of math, will show you that a game can be profitable after selling only 25k copies.

6 minutes ago, mr_me said:

47 minutes ago, IntelliMission said:

The second one seems a bit more serious but it appears to be lacking key information about how the financial success of the project:

 

 

Tommy (and everyone), what do you have to say? Answering the first one can probably be fun since his suggestion is so crazy, and clarifying the second with real data would also be great.

In the interview he said 5M units, not $5M.  That would be at least $1B in revenue (assuming lifetime sales not annual).  Regarding game development, consider small teams of four or five people working for six months, and a little bit of math, will show you that a game can be profitable after selling only 25k copies.

You should reply to him !

1 hour ago, IntelliMission said:

I just found a couple of interesting comments in the Vara Dark interview. The first one is plain hilarious:

 

 

The second one seems a bit more serious but it appears to be lacking key information about how the financial success of the project:

 

 

Tommy (and everyone), what do you have to say? Answering the first one can probably be fun since his suggestion is so crazy, and clarifying the second with real data would also be great.

Luposian is doing the typical doomsaying but he's dressing it up with a more "concerned" or attempted logical reasoning. 

He's just saying "This won't last and can't be funded because money." They all say the same things, and always say the same things, but phrase it like they are the first person to come up with this or that they have come up with the perfect "gotcha" comment. 

All jokes aside, his comment boils down to this:

"BUT how will you support it without having infinite money forever...? In 3-5 years you'll be broke and say thanks everyone, bye!"

Tommy should address him but it's kind of pointless to say anything to that. If it sells well and the games sell well, it supports itself. If they don't, then that's that.

He says "this doesn't make business sense", but what he posted IS business. You make a product, hope it sells, and continue to support it while it does... Could be 6 months, could be 1 year, could be 5 years. Ultimately I just see his comment as pointless. 

I like how he kind of assumes that you can't make any money with games at $10, so he then goes to assume that the Amico will constantly need more and more funding and never make any profits. And then he explains everything with an in-depth financial analysis... oh wait, he never does that. 😑

2 hours ago, IntelliMission said:

I just found a couple of interesting comments in the Vara Dark interview. The first one is plain hilarious:

 

 

The second one seems a bit more serious but it appears to be lacking key information about how the financial success of the project:

 

 

Tommy (and everyone), what do you have to say? Answering the first one can probably be fun since his suggestion is so crazy, and clarifying the second with real data would also be great.

No worries.  When there's need of a long reply to a YouTube comment involving any sort of numbers or analysis, I'm there.  It's like my bat symbol.  ::cue the Mighty Mouse theme song::

reply as follows:

He didn't say $5m in sales. He said 5 million units. $5,000,000 in sales is not going to cover operating costs. 5 million units sold (as he was talking about PS4 at 100+ million, Switch at 50 million, Xbox at 30 million units).. equates to approximately $1.2 billion in sales revenue. If the average console purchase price is about $240 (considering a base model of $230 and a special edition of $280, with more base units than special editions sold) average recorded sales for every 1 million units is $240,000,000. Or $1.2 billion when the 5 millionth Amico is sold.

That is before you ever factor in 1) software sales, 2) additional controller sales, 3) merchandise sales, or any other licensing agreements or sponsorships secured. Software sales in the current pricing model is usually 7-10 times the number of units. The Switch has sold ~45-50 million units right now, software sales are going to be about 300 million units. And that's software at $50-60 per unit sold for many of those physical sales.

If they're reporting $1.2 billion (with a B) in sales, and Walmart, Costco, Best Buy, Target, Toys R Us et al are getting good margins, they're going to go out of their way to support sales moving forward as it's a high return product for them for one. Where's the recouped development cost? In-house developed games are going to run Intellivision $100k or less, per game, in overall cost - they're likely produced in 5-8 months by a team of 5 employees concurrently working on 3-5 games, so you're talking about overall game development cost around $100k on average if the devs are paid close to $100k salaries and their yearly output is 4 games that they had a hand in producing with the average 5 man dev team. Certain games will be less intensive card games, translations of licensed board game properties, recreational sports.. others will take more time/resources. Games developed externally in partnership with developers working on Amico exclusives are going to be closer to $150k-$350k in development costs. That's a bit more up front cost. But still, if you think about 20 in-house games released per year, that's no more than $2-3 million in development costs. And if you think about another 30 games produced annually by third party developers, that still assumes annual production costs of $6-$10 million per year.

But Tommy just said $1.2 billion worth of console unit sales at that theoretical 5 million units sold worldwide. If they're spending $12 million per year on software development, and retailers are getting a guaranteed 25% margin per hardware unit sold on that $1.2 billion ($300 million), and they're spending $12 million per year on marketing and another $4 million in new game licensing each year ($16m per year), over four years that's $64m for marketing/licensing, $48m for software development.. EVEN if the production and distribution costs of manufacturing and moving 5 million Amico consoles was $750 million in cost, you're looking at a remaining profit of around $42 million over four years after the major costs (licensing, development, marketing, manufacturing, retailer cut) is taken into account. And in that figure, we haven't even added ONE single dollar from software sales. On a primarily digital access platform. Or additional controllers/accessories. Or merchandising. Or other important revenue like sponsorships, Intellivision's own licensing deals and exclusive contracts..

And we both know if the system can sell 5 million units, it can easily sell 60 million individual games (12 games lifetime purchases per buyer at $8 average expense per game, $96 in games sales per owner.. or the equivalent of the average Switch or PS4 owner buying exactly one full price game and one clearance price game over a four year lifetime of games purchases for that system). If that's an $8 average per-game expenditure on a paltry 60 million games, that's $480 million dollars in revenue. With zero retailer cut for most of those games (and even for the physical games for collectors appearing exclusively in stores, let's just knock that number down to $350 million dollars in digital-only revenue. That's still about $400 million dollars in profit Intellivision has pulled from selling 5 million systems with an average consumer expenditure of under $100 in lifetime games purchases.

I was VERY conservative with these numbers. And I didn't account for taxes Intellivision will have to pay and more than enough ancillary costs to chip away at that $400 million - but I think when we're talking about revenues north of $1.5 billion and remaining profits after major costs, venture funders have been handsomely rewarded with a good return on investment, there's a strong Intellivision brand with a successful product and healthy assets and revenue stream at the end of the day. The other big three can't operate like that because their game development on average for the AAA titles is 50 to 500 times the cost. Those dev teams are 50-100 man teams on giant Bethesda open world explorers. Their marketing isn't $12 million annually, it's $80 million. Their systems are not cost-efficient, production/distribution costs are above 75% of their MSRP. Retailers may make $40 per Switch sold, and if Nintendo spends $240 to manufacture and distribute each Switch, you can see the modest profit margin that both Nintendo and retailers have to work with. But they're all raking in several billions, even at that scale.

I think the plan is sound, the funding is there, the costs are exceptionally lean and they'll be successful. Before ever considering what the Plan B or any follow-up system would need to be.

Here is a recent reply from the Night Stalker Video on You Tube.

Nick Bruty (Rogue Rocket Games) on Twitter: Making AstroSmash for @Intellivision. Having a lot of fun making an old school shooter again.

1 hour ago, RetroAdvisoryBoard said:

I was VERY conservative with these numbers. And I didn't account for taxes Intellivision will have to pay and more than enough ancillary costs to chip away at that $400 million - but I think when we're talking about revenues north of $1.5 billion and remaining profits after major costs, venture funders have been handsomely rewarded with a good return on investment, there's a strong Intellivision brand with a successful product and healthy assets and revenue stream at the end of the day. The other big three can't operate like that because their game development on average for the AAA titles is 50 to 500 times the cost. Those dev teams are 50-100 man teams on giant Bethesda open world explorers. Their marketing isn't $12 million annually, it's $80 million. Their systems are not cost-efficient, production/distribution costs are above 75% of their MSRP. Retailers may make $40 per Switch sold, and if Nintendo spends $240 to manufacture and distribute each Switch, you can see the modest profit margin that both Nintendo and retailers have to work with. But they're all raking in several billions, even at that scale.

I will keep it short in order to hopefully avoid the (well deserved) wrath of Blarneo - but Intellivision is likely going 1) going to have the highest margins in the business on their consoles, 2) provide the highest margin to retailers (and it is all about margin per foot of shelf space for Walmart/Target/BestBuy etc) 3) the highest percentage of estore sales revenue (better than 70%/30% instead of 30%/70%) and all on a ultra low cost basis with critical costs like staff, base marketing and base game development running cost under $30 mill a year (of course they will spend more if they get more). It would take an astoundingly low number of sales for a console (basically hundreds of thousands of units - rounding error for any of the majors) for Intellivision to become profitable and any million unit sort of sales would produce skyrocketing returns on investment. This is why Intellivision can manage to attract VC funding even after the huge ($50 mill) Ouya investor burn & Atari VCS giving the alternate console industry another, on-going black eye.

Thanks, RetroAdvisoryWall...

Just kidding, that was really informative. 🤓

By the way I have more news for you all, courtesy of Robert Shmigelsky: 1) Board games are better in Facebook, 2) The Amico is not powerful enough for 3D motion controlled sports and 3) Intellivision Entertainment's only chance is to be bought by Google. Source: his *ss.

(Thanks, 1001lives, for pointing that out!)

I believe Mr. Rivers is doing the best he can with the keyboard in front of him.

46 minutes ago, IntelliMission said:

Thanks, RetroAdvisoryWall...

 

Just kidding, that was really informative. 🤓

 

By the way I have more news for you all, courtesy of Robert Shmigelsky: 1) Board games are better in Facebook, 2) The Amico is not powerful enough for 3D motion controlled sports and 3) Intellivision Entertainment's only chance is to be bought by Google. Source: his *ss.

 

 

 

(Thanks, 1001lives, for pointing that out!)

Has he specified what this 'prohibitive artificial paywall' the Amico supposedly has is? Because I am stumped and he keeps bringing it up.

I doubt it is the cost of the games themselves, as a 10$ high end cost is hardly considered prohibitive, when considering Switch and XBox games cost around 50-60$ per game.

The paywall part has me puzzled as well. Tommy has mentioned multiple times that when you buy an Amico game; you get 100% of the game. No DLCs, loot boxes or micro-transactions will be allowed. Many mobile games will indeed give you their game for 'free', but after you play it a bit you start hitting micro-transaction paywalls. That is just the reality of it, you always pay one way or another. None of these mobile companies are making games just to bring joy to the world.

It is a bit amusing that when you get right to the heart it; he seems indignant that the console will cost money, and that games will also cost money. The gall of Intellivision, actually charging for their products!

1 hour ago, IntelliMission said:

Thanks, RetroAdvisoryWall...

 

Just kidding, that was really informative. 🤓

 

By the way I have more news for you all, courtesy of Robert Shmigelsky: 1) Board games are better in Facebook, 2) The Amico is not powerful enough for 3D motion controlled sports and 3) Intellivision Entertainment's only chance is to be bought by Google. Source: his *ss.

 

 

 

(Thanks, 1001lives, for pointing that out!)

Where the heck do these people come up with this stuff? And why do they all always say the exact same things. Down to the letter sometimes. People love the idea of something failing. Why is that all they talk about? Failure? Is that all their lives are about? I just can't imagine doing that. Going around to random products and typing up paragraphs about how it will fail spectacularly. Is this like a failure fetish I don't know about?

The perfect solution is for Google to buy them and make Stadia 2.0? Just what the heck is he going on about... What?

Do these people just like to type a lot?

Still no confirmation e-mail for myself or my friend and we both ordered from different places within 5 minutes after the preorder went live.

He ordered 2 with the PayPal option,2 separate transactions to make sure I got one too in case something went wrong with my order.

I used the credit card option,I thought maybe that was why I didnt get my confirmation yet.

I sent an e-mail to Intellivision Entertainment. 

I will hope for the best and wait and see!👍😊

OK, how about the rest of you lot... you coming down yet from the Getting HIGH of the purchasing of the Founders Edition Amico?

It has finally set in I am now part of the Intellivision Family... and officially purchased my 1st Intellivision!

Now to just figure out who here is the Drunk Uncle of my new Intellivision Family... LOL.

Hell.. it may be ME!!!  WTH.

haha

Nice to be aboard this new trippy ship of my life.

TJ

3 hours ago, Tavi said:

Has he specified what this 'prohibitive artificial paywall' the Amico supposedly has is? Because I am stumped and he keeps bringing it up.

I doubt it is the cost of the games themselves, as a 10$ high end cost is hardly considered prohibitive, when considering Switch and XBox games cost around 50-60$ per game.

The paywall part has me puzzled as well. Tommy has mentioned multiple times that when you buy an Amico game; you get 100% of the game. No DLCs, loot boxes or micro-transactions will be allowed. Many mobile games will indeed give you their game for 'free', but after you play it a bit you start hitting micro-transaction paywalls. That is just the reality of it, you always pay one way or another. None of these mobile companies are making games just to bring joy to the world.

It is a bit amusing that when you get right to the heart it; he seems indignant that the console will cost money, and that games will also cost money. The gall of Intellivision, actually charging for their products!

The paywall is the idea that Intellivision could sell the games for another system or mobile or PC/Steam/AppleArcade without needing to pay for a new console and that no one is going to pay $230 to buy a console for games they could play on their phones or switch. As Tommy once said, some have said they hope the Amico fails so the games will get ported to other consoles. Of course, all of this has all the basis of typical misinformation and rumors mix free of actual investigation that is typical of the internet and has been countered several times. 

For instance, the red haired woman who interviewed Tommy in a video a few days ago suggested he could put the games on Apple Arcade and people could use their Apple iPhones as controllers ... but what if you have Android phones...SOL. 

15 minutes ago, AtariSociety said:

OK, how about the rest of you lot... you coming down yet from the Getting HIGH of the purchasing of the Founders Edition Amico?

 

It has finally set in I am now part of the Intellivision Family... and officially purchased my 1st Intellivision!

 

Now to just figure out who here is the Drunk Uncle of my new Intellivision Family... LOL.

 

Hell.. it may be ME!!!  WTH.

 

haha

 

Nice to be aboard this new trippy ship of my life.

 

TJ

 

 

 

Stop rubbing it in,I am not officially a member of the family yet!😄

3 minutes ago, wolfy62 said:

Stop rubbing it in,I am not officially a member of the family yet!😄

Do you not own any Intellivision?  I figured I was among a small party here that has never owned on at all.. 😀  TJ

1 hour ago, wolfy62 said:

Still no confirmation e-mail for myself or my friend and we both ordered from different places within 5 minutes after the preorder went live.

He ordered 2 with the PayPal option,2 separate transactions to make sure I got one too in case something went wrong with my order.

I used the credit card option,I thought maybe that was why I didnt get my confirmation yet.

I sent an e-mail to Intellivision Entertainment. 

I will hope for the best and wait and see!👍😊

I am sure it will work out with a positive result. I ended up using the credit card option since PayPal would not load. (Blank white screen)

The fact both of you are waiting for confirmation is  encouraging and would suggest a issue with delays on posting out the emails. 

1 hour ago, AtariSociety said:

Do you not own any Intellivision?  I figured I was among a small party here that has never owned on at all.. 😀  TJ

No,I actually own everything intellivision! 

Collecting and playing proudly for 40 years!👍😀

16 minutes ago, wolfy62 said:

No,I actually own everything intellivision! 

Collecting and playing proudly for 40 years!👍😀

See... you have enjoyed the greatness of Intellivision all these years.. and me... I have no clue what I been missing. 😋

TJ

Speaking of family - the Amico family grew by one a couple of days ago. It may take a while for him to get the hang of the controller though.

Sumeet is the Managing Director of MENA/South Asia for Intellivision Entertainment

3 hours ago, Tavi said:

Has he specified what this 'prohibitive artificial paywall' the Amico supposedly has is? Because I am stumped and he keeps bringing it up.

In this case the paywall is the Amico itself.  Because all the games are exclusive, if you are only interested in one Amico game you have to pay over $200+ to play it.