The Beatles: Rock Band debuts to solid but not stellar sales

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Apparently, love isn’t all you need.

The Beatles: Rock Band, Viacom Inc.’s highly anticipated and pricey video game based on the music of the biggest-selling rock band of all time, drew a healthy but hardly standing-room-only crowd.

In September, its first month in release, the game sold 595,000 units in the U.S., according to the NPD Group.

That’s bigger than the first month sales of either 2007’s Rock Band or 2008’s Rock Band 2, but far below the best launches in the genre and some analysts’ estimates.

2007’s Guitar Hero III, for instance, sold 1.4 million units in its first six days on sale in October 2007.

Analyst Michael Pachter of Wedbush Morgan Securities had estimated that The Beatles: Rock Band would sell 1.3 million units last month. Jesse Divnich, director of analyst services for Electronic Entertainment Design and Research (EEDAR), estimated the game would sell 1 million units.

But Anita Frazier, an analyst at NPD, said initial sales for The Beatles: Rock Band were ‘very strong.’

Although it’s difficult to know what Viacom’s expectations for the game were, initial sales didn’t demonstrate that it had reached a wide range of gamers or Beatles fans. The month’s top-selling game, Halo 3: ODST, sold 1.5 million units, nearly three times as many as The Beatles: Rock Band.

However, Guitar Hero 5 came in a little behind the Beatles game, selling 499,000 units, according to NPD. Publisher Activision Blizzard Inc. had offered a free copy of December’s Guitar Hero: Van Halen to those who bought Guitar Hero 5 in its first month in an apparently unsuccessful attempt to boost interest.
Both games’ far-from-stellar sales were undoubtedly affected by continued sluggishness in the video game industry. With a number of big new releases and an easy comparison with 2008, EEDAR had projected that U.S. video game software sales would rise 16% last month. Wedbush Morgan had projected 21%. NPD reported, though, that they actually grew just 5%.

Viacom guaranteed at least $10 million to the various rights holders to the Beatles’ music and likenesses in exchange for all of the rights associated with the game, according to people familiar with the deal terms. Several people involved expected royalties to ultimately reach $40 million or more.

Despite the sizable royalty payments, Viacom has been counting on the Beatles game to turn around the significant losses it has experienced from its investments in the first two Rock Band video games.

The company is also counting on revenue from track downloads to improve the Beatles game’s overall profitability. MTV Games, the Viacom division that publishes Rock Band titles, said the first Beatles song available for download, ‘All You Need Is Love,’ had sold more than 100,000 copies so far.

Update (5:02 PM): For a more detailed analysis of the overall video game industry performance in September, check out the Times’ technology blog.

Update (12:26 AM, Oct. 20): For more, see the story in today’s Times.

-- Ben Fritz

Related: Viacom hoping the Beatles will change its money-losing ways in video games