Mr. Mullins, 19, is the creator of “Felix the Peaceful Monk”—his character in a videogame called The Elder Scrolls V: Skyrim. The game gives players wide latitude over their on-screen characters’ appearance and actions. Felix, who is half man, half cat, has become a small-time Internet celebrity for his steadfast refusal to kill.

Read the rest of this post on the original site »

Okay, okay, we get it: Morgan Stanley got the coveted left-hand lead position on Facebook’s blockbuster IPO filing. Goldman Sachs is there, too, but in the third-place, always-a-bridesmaid spo,t and is crying big salty tears about the injustice of it all.

It’s hard to feel badly for overpaid investment bankers, and focusing on them is kind of like endlessly discussing the lawyers who processed your mortgage, when the focus should be on the house you’re buying.

Does anyone except a few Richie Rich ZIP Codes in Manhattan care about this one deet of the initial public offering of the social networking giant?

Nope, but there is so little real news ahead of the IPO filing expected today that this is what we are chomping on this morning, as everyone awaits the big doc drop at the Securities and Exchange Commission.

Sources said it is likely to come this afternoon rather than this morning, though. And, perish the thought, all that dotting of I’s and crossing of T’s could delay it to tomorrow, even (unlikely, but mebbe!).

Sigh.

Tidbit: Facebook was actually founded the first Wednesday in February of 2004 in an undergraduate dorm room at Harvard University, like today but eight years later.

Thus, here’s a boring Facebook history timeline chart to look at:

Okay, that was really dull.

What up? The board met, the spinmeisters are at the ready and, most of all, Silicon Valley is stoked to make some more arrogant badillionaires.

Now, hopefully, we’ll get the real news about Facebook.

Namely, who’s getting the big dough in this much-anticipated Web 2.0 gambit? Co-founder and CEO and Hoodie Commander Mark Zuckerberg fer sure, but who else?

Plus all the juicy financials from Facebook, along with stats in usage, growth and just how much the company sticks it to its gaming serf — oops, partner — Zynga and others for the privilege of being on its all-powerful platform.

Me? I pay nada, like other Facebook users, for being able to show off pictures of my vacations and decline friendships from PR people I like, but still … well, you know.

Here is another Facebook financial chart that will not knock your socks off unless you are an accountant:

I am now so comatose waiting for the show to begin that I briefly began a liveblog of my activities this morning.

It went like this:

4:45 am PT: Done with AOL Q4 earnings, which were meh, but better meh than expected. AOL, if you recall, used to be Facebook and now is, um, not.

Note to Zuckerberg: Be nice to people on your way up, since you’ll meet them again on the way down.

4:46 am PT: I check the SEC site and get zip. Click, click, clickety-click over to find out the latest on Demi Moore and her fake-pot debacle.

Who knew there was synthetic cannabis and it is called K2 or Spice? Not me! According to Wikipedia: “It seems likely that synthetic cannabis can precipitate psychosis and in some cases it is prolonged.”

I decide to blame Ashton Kutcher and then wonder if he is an investor in Facebook via BFF-to-errant-celebrities-who-like-tech Ron Conway, also a Facebook investor.

Note to self: Call Ashton! That dude plays village idiots all the time, but I am not fooled by Mr. Pretty Face.

4:47 am PT: I consider email bombing Yahoo’s Jerry Yang, who is probably not so busy right now, and asking him what he thinks about the Demi Moore crisis and also Facebook’s IPO.

Remember when Yahoo was king of Silicon Valley and Yang posed in that purple VW on the cover of that magazine? Better still, remember when Yahoo was going to buy Facebook for just over $1 billion and then borked it?

Just sayin’, Mark — so, keep it reals!

4:48 am PT: I consider going out for doughnuts — and not because of any real weed need. I just would like me some glazed and sprinkled sugar treats right about now. Then, I could post the pictures of them on my Facebook page.

Sweet.

But you-know-who would file right when I left the house on the munchie run. Click, click, clickety-click over to the SEC site and I come up peanuts.

Time to check in on the Kardashians.

You get the idea — so, Facebook IPO, take me away!

MORE ON THE FACEBOOK IPO:

• Facebook’s Ad Business Is a $3 Billion Mystery
• Viral Video: Farewell to the No-IPO Mark Zuckerberg
• Zuckerberg Is the Billion-Share Man: Who Owns What, Who Makes What in the Facebook IPO
• Zuckerberg Tells Investors, “We Don’t Build Services to Make Money”
• Mobile Highlighted as Key Risk Factor (and Opportunity) in Facebook Filing
• Stop All That Poking: Facebook Filing Temporarily Crashes SEC Web Site
• Zynga Accounted for 12 Percent of Facebook’s Revenue in 2011
• Facebook Has 845 Million Users
• On Its Eighth Birthday, Facebook Files to Raise $5 Billion in Massive IPO (Get Your S-1 Here!)
• Go the F**k Back to Sleep, Silicon Valley: Facebook IPO Likely to File Later Today at Earliest
• Dude, Where’s My Facebook IPO Filing? (Ashton’s on Hold!)
• The Quiet Man: Meet the Less-Known Face of the Facebook IPO, CFO David Ebersman
• Facebook Board Meeting Today for Final IPO Okays
• Facebook (Eye)PO: Tracking the Truth of the Biggest Deal of Web 2.0
• Viral Graphic: Visualizing the Facebook IPO
• Is Facebook IPO on Track for Late May?
• IPO Watch: Facebook Hiring Brunswick to Help With Comms for Expected Public Offering
• Complete Facebook coverage

The Kyoto-based videogame maker also offered an even bleaker outlook for its full-year earnings for the year to March, saying Thursday that net losses will be three times greater than its projections in October as valuation losses on foreign-currency holdings from the strong yen continued to swell.

Read the rest of this post on the original site »

Whether women buy more tech products than men seems to be another facet of the subject emerging right now.

According to a new report from Parks Associates, more women than men are downloading movies and music, women do the majority of game-playing across some platforms, and women have higher “purchase intentions” than men do when it comes to some electronics.

In the 1986 movie “Ferris Bueller's Day Off,” Ferris got a computer, while Jeannie got a car.

Women are 40 percent more likely than men to play games on Facebook, represent the majority of Nintendo Wii players, and match men in terms of owning and playing Microsoft’s Xbox and Sony’s PS3, says the report. And women are 73 percent more likely than men to have watched a full-length TV show online in the past 30 days.

Parks Associates also says that women have higher purchase intentions than men do when it comes to buying popular devices like tablets, laptops and smartphones, though men’s interest surpassed women’s when it came to purchasing flat-screen LCD TVs.

Intent, of course, is different from pulling the trigger and pressing the e-commerce “buy” button.

This Nielsen study, meanwhile, refutes the idea that women aren’t likely to purchase advanced TVs.

And while the Parks Associates report says 88 percent of women purchased tech-related items last year, compared to 83 percent of the men surveyed, not all recent reports point to women as besting men in tech-buying.

Confused yet? You’re not alone.

Let’s look at this chronologically:

In 2008, men were estimated to spend $902 annually on consumer electronics, compared with the $558 women spent on tech each year.

By 2009, women were spending more on consumer electronics than men, according to the CEA. It says women accounted for $55 billion of the $96 billion spent on electronics gear that year.

But in 2010, as our WSJ colleague points out here, the average man reported spending $3 on consumer electronics for every $2 the average woman said she spent.

With all of the fluctuating data, perhaps comparing women to men when it comes to consumer tech spending isn’t the right way to look at it. It’s how much growth is occurring overall when it comes to women and consumer tech.

We’ve come a long way from this 2003 report on women being “comfortable” purchasing PCs and DVD hardware.

Despite the fact that women were still trailing men in terms of consumer electronics purchases in 2010 — women spent $631 on average, compared to men’s average annual spend of $969 — women still spent $73 more on tech products than they did in 2009. And that number is expected to continue to grow.

You’ve probably heard a lot about the emergence of female purchasing power. A lot of this may have to do with the current state of the economy and shifts within households: While men are recovering more quickly from the recession — regaining more than one out of three jobs lost, compared to women regaining about one in four — men have been hit harder over the past few years, hovering at a full percentage point higher in terms of unemployment. (Some of the recent employment gains for men may also be attributed to a disproportionate number of men working in the government sector who have been regaining their jobs.)

Many women consider themselves to be chief financial officers — of the home. According to a Harvard Business Review report from last year, U.S. women continue to say they control more than 70 percent of total consumer spending. Earlier reports indicate that this number could be even higher, but some researchers say the number is murky.

Another Nielsen study shows big differences between what female consumers in developed countries spend money on versus what females in emerging countries spend on: More than half of women in emerging countries focus on allocating household funds for their children’s education, compared to 16 percent of women in developed countries, who are more likely to spend on vacations and other items. And yet, in both developed and emerging countries, more than half of women surveyed say that purchases of computers, mobile phones and smartphones have changed their lives for the better.

Bottom line: Women are making more buying decisions, and that includes consumer technology products, though the growth to date seems incremental. And that doesn’t necessarily have to be measured against what men are buying — though marketers like to know these things.

We can only hope that increases in women’s tech purchasing also means that manufacturers and marketers are getting savvier about that age-old question — what do women want? — and that the answer isn’t necessarily hardware in stereotypically girlish hues.

According to NPD data released today, about $6.7 billion, or 40 percent of consumer retail spending, was spent on the Xbox, breaking down into two categories: $2.1 billion on consoles and $4.6 billion on games.

The figures take into account U.S. retail sales of new physical videogame content, including portable and console hardware, games and accessories.

In all, those sectors generated revenue of $17.02 billion in 2011, an 8 percent decline over the $18.6 billion generated last year. (Yes, I repeat, Microsoft got 40 percent of that in 2011.)

The initial report does not take into account sales from digital formats such as downloadable content on the console, social and mobile games, or other categories, including used and rentals.

Those so-called “newer” categories generated $7.24 billion in revenues last year, an increase of 7 percent over the prior year.

The increase in spending on alternative formats, however, wasn’t enough to offset declines in physical retail. All told, consumer spending across both categories totaled between $16.3 billion and $16.6 billion, falling 2 percent over last year.

Separating physical and digital sales is quickly becoming an outdated concept, since the two are so intertwined. Consumers have the choice of purchasing many of the games over the Internet via a digital download versus buying them at Wal-Mart or Target.

NPD acknowledged today that it needs “deeper visibility” into digital distribution to get a complete picture of the industry, which will be its focus in 2012.

Still, the report can still be used as a litmus test to see what is performing well.

Overall, a surprisingly disappointing December is what dragged down results for the whole year, NPD discovered.

“Because of the great slate of content that came to market during the fourth quarter, I had expected December sales to represent a larger portion of total year sales than what occurred,” said NPD Group analyst Anita Frazier, in a release.

Frazier added that December sales accounted for just 23 percent of the annual total, compared to the past 10 years, when December, on average, represented 28 percent of the total.

In addition to Microsoft’s Xbox, Sony’s PlayStation also performed well, with both witnessing a 5 percent increase across all game categories for 2011. Meanwhile, the Nintendo Wii, which cannot display HD content, saw a decline year over year.

In a separate statement, Microsoft said that it outsold the PlayStation, the second-place console, by 2.7 million units, and that in all, it has now sold 66 million Xboxes and 18 million Kinect accessories. On a global basis, Sony said in a statement that it sold more than 6.5 million units worldwide this holiday season.

Here are the Top 10 best-selling games in December, according to NPD:

1. Call of Duty: Modern Warfare 3 by Activision Blizzard
2. Just Dance 3 by Ubisoft
3. Elder Scrolls V: Skyrim by Bethesda Softworks
4. Mario Kart 7 for 3DS by Nintendo
5. Battlefield 3 by Electronic Arts
6. Madden NFL by Electronic Arts
7. Assassin’s Creed: Revelations by Ubisoft
8. NBA 2k12 by Take Two Interactive
9. Super Mario 3D Land for 3DS by Nintendo
10. Batman: Arkham City by Warner Bros. Interactive

According to research outfit Media Create, which closely tracks the Japanese console gaming industry, Sony sold just 72,479 Vitas during the crucial shopping week before Christmas. That’s a massive decline in sales following the device’s debut — well over 75 percent.

In fact, at 72,479, the Vita actually sold fewer units that its predecessor, the PS3.

So what happened?

That’s not at all clear. Certainly, inventory issues could be to blame. The decline could also have something to do with early reports of problems with the device. While Sony was quick to refute such allegations — which ranged from laggy gameplay to freezes and crashes, it wasn’t able to stamp them out before reports echoing them appeared in the broader tech media.

Could such negative chatter have put this big a damper on holiday sales? Maybe. A more likely explanation, though, is the Vita’s high price, its underwhelming lineup of games at launch, and Nintendo’s decision to debut its wildly popular Monster Hunter game at the same time. Knit those three things together with reports of software glitches and you’ve got a pretty big wet blanket.

Either way, those hiccups will be well behind Sony when the PS Vita hits the U.S. and Canada on Feb. 22, with a pretty impressive lineup of launch titles.

(Media Create chart courtesy of Neograf)

Though it won’t arrive in the U.S. until Feb. 22, Sony’s newest handheld gaming device has stumbled out of the starting gate in Japan. The device sold 321,400 units in two days, but on Monday, Sony issued an apologetic statement after complaints emerged that the Vita was freezing and crashing.

But, for what it’s worth, there is a common thread between the two products: Sony’s new gadget was developed in part by one of the original creators of one of the most successful consumer-electronics devices of all time.

As the PlayStation blog reports today, the look and feel of the Vita was designed by Takashi Sogabe of the Sony Corporate Design Centre. It also notes that Sogabe, who has been at the company for 27 years, worked on the original Walkman.

While it probably isn’t entirely accurate that he worked on the original Walkman (since it came before Sogabe’s time), a bio on Sony’s Web site gives him credit for a “See-through Walkman,” and a “Beautiful Walkman.” He also worked on the PlayStation 3 and Sony’s e-reader.

The PlayStation blog will be posting a full interview with Sogabe later, but today’s post did offer some details.

Sogabe said the design team came up with various versions of the Vita, including one with a sliding back, and another that snapped shut like a clamshell.

He also said that they tried to incorporate two touchpads in place of the dual analog sticks, but that they weren’t accurate enough.

(Takashi Sogabe image courtesy of Sony)

(Walkman images courtesy of Wikipedia)

Zynga is set to begin trading tomorrow morning, having achieved a $1 billion initial public offering.

This evening, the San Francisco company confirmed that it priced at the high end of its range by selling 100 million shares at $10 apiece. Shareholders also granted the underwriters a 30-day option to purchase up to 15 million additional shares if there is more demand. That will bring the total to $1.15 billion; however, Zynga will not receive any of the proceeds from those additional shares.

Zynga had been seeking to sell 100 million shares at between $8.50 to $10 each. By hitting the high end, it easily becomes the largest Internet IPO in the U.S. since Google in 2004. The company will now be worth around $7 billion, which is in line with other publicly held game companies, such as Electronic Arts.

But tomorrow will be the true gauge, once the company starts trading freely on the Nasdaq under the ticker symbol ZNGA. It is looked at as favorable if the stock jumps right out of the gate; if trading is more modest, it could signal that Zynga was priced fairly.

What is particularly stunning is the global appetite for game companies. Earlier this week, Tokyo-based Nexon went public on the local stock exchange, also raising $1 billion at the same valuation of $7 billion.

Investors and employees in particular will be banking on Zynga’s price to pop tomorrow. Earlier this year, the company sold shares to investors for $14, roughly 30 percent higher than the $10 price. Some employees’ stock options are rumored to be issued at even higher prices.

The worst-case scenario is that the stock falls. In November, Groupon shares jumped by 40 percent on the first day of trading, increasing to as much as $30 from the intial $20 pricing. But by the end of the day, the share price settled down at $26, and in subsequent weeks, fell to as low as $15.

Nexon’s stock fell modestly in next-day trading; however, that was largely blamed on a weak economy.

The social games leader, known for FarmVille and other franchises like Words With Friends, may have decided to price its offering modestly to avoid scenarios like that.

Already, it is choosing to do things a bit differently. Zynga won’t be flying to New York to ring the opening bell, as is customary.

Instead, the company’s founder and CEO, Mark Pincus, will ring the bell remotely from its brand-new San Francisco headquarters, where the Nasdaq has set up a temporary bell. Pincus will be joined by the company’s management team, board member Bing Gordon and Pincus’ wife, Alison Pincus.

That designation comes from Web video tracker Visible Measures, which says the official upload from Apple, plus unofficial uploads and derivative clips (parodies, “responses,” etc.), generated 28 million views this year.

Runners-up for the “most viral” title, according to Visible Measures: Ads featuring Lady Gaga, the International Space Station, PlayStation 3 and YouTube gaming god Freddie W. (One of these things …)

It’s worth noting that Visible Measures’ methodology and classifications for this one are a bit particular. For instance, it includes ads for videogame platforms, but not the games themselves. There’s some logic to that, because while videogames have many, many more views, the bulk of them come from “game play” videos that players upload themselves.

Which is fine, but that also means that straight-up ads like Jonah Hill’s Call of Duty spot don’t make the list. And that one has racked up  a minimum of 17.7 million views this fall.

But at the very least we can say that these are five very, very popular Web videos from the past year.

Google Chrome’s “The Web is What You Make of It” Campaign: 22 million views

YouTube/Spacelab: 17 million views

Sony PS3 “Michael/Long Live Play” ad: 15.8 million views

YouTube star Freddie W’s Samsung “Gamer Commute” ad: 11.5 million views

“It was strictly a business decision,” said Kabam’s COO Chris Carvalho, quoting a line from The Godfather.

Carvalho said that in return for Google getting a 45-day exclusive, Google has agreed to drive traffic to the game through various marketing techniques. In addition, Google only takes a 5 percent cut of revenues from virtual goods sold inside the game, compared to Facebook’s 30 percent cut.

Together, those two incentives could make for a more profitable game, even if Google’s audience is much smaller.

“We’ve found our games monetize very well on the Google+ platform, and their team to be incredibly responsive and willing to get things done quickly and efficiently,” Carvalho said.

At last count, roughly 40 million people have joined Google+, and to date, it has a total of 28 games. In comparison, Facebook has more than 800 million users worldwide, and literally has too many games to count.

Getting heard above all those distractions on Facebook can be costly, so clearly Kabam feels it has a better chance to stand out on Google.

It will be important to see if other developers feel the same way and follow in Kabam’s footsteps. If so, Facebook may feel pressure to make games easier to find (other than the developer purchasing more ads), or even adjust its revenue cut, as some have suggested may occur with increased competition.

In all, Kabam has three other games on Google+: Dragons of Atlantis, Global Warfare and Edgeworld.

The Godfather will not be the first exclusive on Google+ Games. Rovio launched Angry Birds first on Google+, and still hasn’t officially launched yet on Facebook (probably due to the large costs, since Rovio is known for being outspoken about Apple’s 30 percent revenue cut on mobile devices).

Kabam has licensed rights to “The Godfather” movie from Paramount Digital Entertainment to build a big-budget social game for Facebook, based on the American Mafia classic.

Kabam, which is based in Redwood City, Ca., is known for making hardcore social games that appeal to gamers typically found using videogame consoles. That differs from Zynga, the leading social games company, which makes mainstream games for the largest audience possible.

The game, which launched today, is set in the Prohibition era of the 1930s, preceding the setting of the first film by about 10 years. Players and five crime families will battle for money, power and respect, with the goal of becoming the “Don” of a family.

The illustrations are cinematic, with extremely dark and menacing graphics, which is a dramatic shift from the cartoonish art and happy, smiling characters found in most Facebook games today.

In a statement to All Things D, Microsoft said: “We are still working to get the release out. Stay tuned, we’ll have an update this afternoon on when it will begin rolling out.”

(Update: By late afternoon, Microsoft said the rollout would begin gradually in a few hours.)

The free over-the-air software update was due to hit the Xbox this morning.

As part of the update, the Xbox is getting a major face-lift that would give users the ability to control the interface with the Kinect using voice and gestures.

It also aims to turn the game console into an entertainment hub for the living room through the addition of several new content deals that will provide access to more movies and TV.

The delay was first reported by Xbox employee Larry Hryb, who goes by @majornelson on Twitter. At roughly 7 am PT, he tweeted: “FYI: The timing for Xbox 360 dashboard update has been slightly delayed. I’ll have a status update later today.”

In a follow-up tweet, he added: “I’ll share additional details when I have more to share. Until then, thanks for you patience.”

In it, WSJ.com’s Markets Hub host Paul Vigna asked the (largely offscreen) media mogul some questions about online stuff, as the other two (terrified-looking) panelists watched.

What about buying into online gaming giant Zynga’s upcoming IPO? “No,” gruffed Murdoch. Does he play its flagship game, FarmVille? Of course not.

Murdoch is apparently on Facebook, though. Well, could Vigna be besties with his ultimate boss (News Corp. owns Dow Jones, which owns The Wall Street Journal, which owns WSJ.com, which also owns AllThingsD.com) on the social networking giant?

“No,” growled Murdoch.

Heh.

But the 3-D handheld gaming device has gotten a boost from recent game releases, and the gaming giant hopes two more items will keep the hardware’s momentum going for the holiday season.

This Sunday, Nintendo will release Mario Kart 7 for 3DS. It’s the second game in the Mario franchise aimed at the portable device in the past two weeks. Retailing for $39.99, Mario Kart 7 includes new courses and kart abilities and supports the 3DS StreetPass feature, which allows users to wirelessly connect to other “Mii” characters as they pass each other on the street or are in the vicinity of each other.

The company also plans to release a pink version of the 3DS, bundled with one of its Nintendogs + Cats games. The pink 3DS will cost $169.99 in the U.S., the same price as the standard Nintendo 3DS system. Nintendo had previously said a pink version was aimed at girls (sigh, but they do like lots of other colors, too).

The Nintendo 3DS, the company’s first 3-D portable gaming handset, hit the U.S. in March, at a price of $249.99. The device has an autostereoscopic screen — which means glasses aren’t required to see the 3-D imagery — and a depth slider that adjusts the intensity of the 3-D.

Consumers were less than thrilled by the 3DS, with many citing vision problems and high game prices, forcing Nintendo to later reduce the price. The move resulted in a 260 percent sales jump, with Nintendo selling 235,000 units in August, ranking it the second-best-selling piece of gaming hardware in the U.S. that month.

The 3DS got another boost when Nintendo’s Super Mario 3D Land game became available Thanksgiving week, as part of a bundle with a red 3DS. Nintendo of America President and COO Reggie Fils-Aime said the game was the fastest-selling portable Mario game in Nintendo’s history, and that interest in the game drove hardware sales up 49 percent.

“We believe more and more that software drives hardware,” Fils-Aime said.

Fils-Aime said Nintendo continues to invest in 3-D technology in terms of content, but for now, consumers shouldn’t hold their breath for a next-generation 3DS.

“I wouldn’t expect a complete redesign of the hardware in the near-term,” he said.

In addition to the new pink model, Nintendo 3DS is available in the U.S. in blue, black and red. A white version of the device is sold in Japan, although Fils-Aime noted that Nintendo’s white handheld DS and DSi devices haven’t sold as well in the U.S. as other colors have.

Experts Give the New Xbox Raves for Control, Creativity
(Dec. 6 2001)
Photo: Mario Tama/Getty Images

Microsoft sold more than 960,000 consoles last week, with a majority flying off the shelves within a single 24-hour period.

Nintendo also said the Wii had the biggest Black Friday ever, selling more than 500,000 units on the day after Thanksgiving.

At one point during the shopping madness, a shopper pepper sprayed a crowd at a Wal-Mart to get her mitts on an Xbox (although reports now say police are investigating the incident to determine the cause of the attack).

Sony declined to release sales figures for the PlayStation 3 last week, but it is likely benefiting from a recent $50 price cut.

Such strong sales are mind-blowing.

People are lining up for — and in some cases fighting over — hardware that is five to six years old. It’s difficult to imagine any other consumer hardware that could attract that kind of demand after such a long period of time.

All three are nearing the end of their life cycles. The Nintendo Wii and PlayStation 3 are both five years old, and the Xbox 360 is a year older.

Nintendo announced that it will release a new console, the Wii U, later next year. Microsoft and Sony have not said anything official, but they are both expected to follow with competing launches in the same time frame.

It has long been a pattern for all three rivals to release new hardware at the same time. A European PlayStation executive recently hinted that Sony’s plan was to continue that trend because it was “undesirable” to be significantly later than the competition, according to IndustryGamers.com.

Despite the odds, there are at least three reasons why sales continue to do well.

The lineup of games is as strong as it has ever been for the consoles; all three have tried sprucing up the hardware with accessories and adding downloadable content; and, finally, consumers don’t have a choice — the only alternative is to wait another year.

First, the games: This year, publishers waited until now to release some of the hottest titles of 2011; hardcore gamers in particular will have their choice of any number of blockbuster hits.

Activision’s Call of Duty game is already a runaway success, grossing $775 million in the first five days it was available, to shatter all entertainment records.

Also in the hardcore genre is Electronic Art’s Battlefield 3, Ubisoft’s Assassin’s Creed, PlayStation’s Uncharted 3 and Rocksteady’s Batman: Arkham City, which are all going head to head this holiday season.

But the consoles don’t just serve the hardcore genre anymore.

Last year, both Sony and Microsoft released motion-controlled gaming systems to rival the Wii’s technology, which has always been considered more family friendly and easy to use.

This holiday season, Sony and Microsoft are offering the most games ever for the Move and Kinect, respectively. Microsoft will have 75 new Kinect games available for the Xbox this holiday, four times last year’s number. Sony said the PlayStation Move is expected to launch 26 titles.

In addition to being used to play games, the consoles are turning into entertainment systems for the living room.

It started with the ability to use the Internet-connected boxes to stream Netflix to TV screens. Now the consoles are turning into media hubs, playing video, music and other content that is readily available over the Internet.

Microsoft and Sony have made entertainment a particular focus between their respective online networks, Xbox Live and PlayStation Network.

Microsoft will make a huge push on Dec. 6, when it rolls out a free update to Xbox Live. Users will be able to conduct a Bing search to find games, music and video across several providers. To make it even more family friendly, the Xbox Live user interface will be controlled with voice commands, rather than by the game controller.

By the end of the year, Microsoft expects that nearly 40 TV and entertainment providers — including Comcast, Netflix, Hulu, ESPN and HBO GO — will be available on its system.

All of these reasons added up could keep the pedal on the gas for what in any other segment would be considered ancient technology.

In an interview, John Koller, director of marketing for Sony’s PlayStation, argued that there’s a lot left in the current generation of consoles.

As an example, he said its predecessor, the PlayStation 2, is 12 years old, but continues to be used in homes around the U.S. as a game player and DVD player. Similarly, the PlayStation 3 substitutes as a Blu-ray player.

Overall, the PlayStation 2 ended up reaching nearly half of all U.S. households.

If that can be used as a guide, then the PlayStation 3 still has a very long way to go. In fact, the goal may be unattainable if new hardware is coming around the corner.

To date, Sony has sold 18.7 million PlayStation 3’s in the U.S. That makes up just a fraction — less than 17 percent — of the 112.6 million households, according to the most recent U.S. Census Bureau figures.

“We are nowhere near where we could be,” Koller admits.

Next year, the true testament will be how the hardware sells as we get closer to the release of Nintendo Wii U and consoles.

According to sources close to the situation, neither CEO Mark Pincus nor one of its principal venture shareholders, Kleiner Perkins, will be selling any shares in its upcoming initial public offering.

While big investors often divest stock in IPOs, not all do. It is a carefully watched number by investors, who are always wary of insiders who unload a lot of shares in an offering.

But such activity by the fast-growing San Francisco online gaming company will be watched carefully since Pincus has recently been painted in a number of press reports as the greedy Mr. Potter of Silicon Valley.

Among the allegations is that he runs a poisonously tough culture that tracks its employees’ output and performance via elaborate data models that require extraordinary amounts of work, along with nefarious list-making of who’s naughty and who’s not.

That big-brother behavior has reportedly included taking away high-ranking jobs and the sweet stock options that go along with them from those execs found wanting.

While there is no doubt Pincus is a hard-charging personality, his defenders note that it’s due to a belief that life at Zynga is a meritocracy and that his practices are not any more heavy-handed than those at other firms.

Indeed, Pincus has a lot of competition in the tough-guy tech CEO category from longtime legends such as Microsoft’s Bill Gates, who set the gold standard for mean, as well as Amazon’s Jeff Bezos and now Google CEO Larry Page.

Pincus does not even rate in this pantheon, which is more typical of tech companies than anyone would care to admit or, to be fair, care to care about. With big benefits, vast wealth and much latitude, many in tech don’t mind the grueling work schedules.

After all, it’s not exactly ditch-digging, now is it?

In any case, sources said the coverage has hit Zynga staff hard, as well as Pincus, who has not responded due to the IPO’s quiet period. That’s in contrast to Groupon, the daily-deals site whose own rough process was rife with highly negative stories about the company’s prospects.

While those media accounts were more aimed at the business itself and less personal, Groupon CEO Andrew Mason vociferously defended the company in a controversial letter that was then leaked and published (to me and by me!).

Pincus will doubtlessly have a lot to say to investors who ask about the company’s culture and its possible negative impact on attrition, as some stories have charged.

His decision not to sell, sources said, was inspired by Zynga investor and close friend Reid Hoffman, who has sold very little of the stock of LinkedIn, where he serves as chairman.

The action all begins next week, according to multiple reports, when Zynga takes its show on the road in preparation for an IPO that is expected to value the company at $15 to $20 billion and will take place before the new year.

It will debut under the ZNGA ticker on the Nasdaq market.

While some have been worried about Zynga’s future growth, its past performance has been a lot stronger than other Internet offerings. In the first nine months of the year, the company posted $828.9 million in revenue, double the amount from a year ago, with net income of $30.7 million.

Pincus’s holding onto shares will be seen as a plus, of course, although he has sold a large amount of stock in Zynga’s history.

According to its S-1 filing:

“From our inception in October 2007 to date, Mr. Pincus, our Chief Executive Officer, Chief Product Officer and the Chairman of our Board of Directors, has purchased an aggregate of 149,197,328 shares of our common stock. To date, Mr. Pincus has sold an aggregate of 43,629,310 shares of our common stock at prices ranging from $0.42 to $13.96.”

Pincus now holds 91.4 million of Class B shares, 16 percent of the total, as well as 20.5 million of Class C shares, 38 percent of that group. Kleiner holds 65.2 million shares, or 11.2 percent, of Class B shares.

Other big Zynga owners, who might or might not sell at the IPO, include Institutional Venture Partners, Union Square Ventures, Foundry Venture Capital and Avalon Ventures.

As I reported earlier today, social gaming giant Zynga has posted another filing with the Securities and Exchange Commission.

That includes Chief Business Officer Owen Van Natta stepping out of an operational role and forfeiting shares in the process. To be exact: That will be 4.6 million options and close to 800,000 restricted stock units.

All of the details are in his transition letter in Zynga’s massive new S-1, which is in exhibit 10.12 to the amendment filing.

I would start at page 119, but to summarize: Van Natta is keeping all the vested stock options and restricted stock units, currently more than two million stock options that are already vested and another 936,000 RSUs (Zynga calls them ZSUs) already vested. He also has another 750,000 shares that will continue to vest due to his board position.

But, because he is no longer an employee, he is forfeiting all his unvested employee stock options and RSUs. Although it does seem like a lot, this is typical in such cases.

I need to go to lunch, so just read it for yourself:

ZYNGAINC-20111117-S1A-0

In a new filing with the Securities and Exchange Commission concerning its upcoming IPO, Zynga is expected to unveil two key management and board changes at the online gaming phenom:

Chief Business Officer Owen Van Natta — who came to the San Francisco-based start-up several years ago to help CEO Mark Pincus grow it and develop it — will step down from his job and become a strategic adviser focusing on major partnerships. He’ll still remain board member at Zynga, but will give up millions of pre-IPO shares by moving out of his operational role.

And director and venture investor Brad Feld will leave the the board, which VCs sometime do as companies move to a public offering and add members with more specific business experience.

In his place, longtime entrepreneur and investor Sunil Paul, who founded a company called FreeLoader with Pincus many moons ago, will join the board.

Zynga confirmed the changes to me in a statement by Pincus:

“Owen is a valuable business partner. He’s made great contributions to Zynga and continues to be an important part of our team.”

Sources said the changes related to Van Natta around are not part of a recent controversy around a Wall Street Journal story about clawing back of some share options grants of early Zynga employees who had become less involved in the company. While the company cannot actually take back already vested shares owned by those staffers, the article has put a lot of scrutiny on Zynga and raised questions about how to cope with the kind of hyper-growth some Internet firms experience.

That’s certainly been the kind of rocket ride Zynga has been on, as it has grown from a small social gaming company on Facebook to a high-profile public company.

Zynga is in the final stages of its IPO process, answering questions from the SEC that are typical. If all goes well, Zynga execs are expected to go on a road show after the Thanksgiving and go public by the end of the year at a market valuation of close to $20 billion.

That was different from when Van Natta officially got to Zynga in the spring of last year — after a rocky experience running the doomed Myspace. At the time, he told me at the time that planned to be focused on scaling the business and did not consider himself a long-term operating executive.

Since then, he has helped Pincus hire a series of experienced gaming execs, including a chief operating officer, a chief marketing officer and others.

Zynga was Van Natta’s third high-profile Web company in recent years. He was a top early exec for Mark Zuckerberg at Facebook until early 2008, and in 2009 he took over News Corp.’s (NWS) MySpace, a job that lasted less than a year.

Early in his career, Van Natta was also was a top strategy, marketing and deal exec for Amazon, which bought an early social networking start-up called PlanetAll that he worked at.

It will now be interesting to see what Van Natta does next, but it is unlikely he will take a permanent position. He is a longtime angel investor in Silicon Valley, including in hot start-ups such as Asana and still holds a significant stake in Facebook.

But, in moving out of his job at Zynga, he will be giving up many millions of shares of a rich trove he was given when he arrived at the company. That said, Van Natta already owns millions of accelerated vested shares and will get another large grant as a board member.

Translation: Don’t cry for Mr. Van Natta, Silicon Valley — he made $42 million last year from Zynga shares alone.

Microsoft said today that longtime company veteran Yusuf Mehdi will be shifting roles to head marketing for the unit that includes its Xbox gaming division. Previously, Mehdi was in charge of the company’s online services division audience efforts. He will now report to Don Mattrick, president of the Interactive Entertainment Business.

Here are the internal memos on the move from Online Services Division President Qi Lu and from Mattrick:

Hi Everyone,

This email is to inform you that Yusuf Mehdi, Chief Audience Officer for OSD, will be moving on to a new and exciting chapter in his career, working for Don Mattrick, President of the Interactive Entertainment Business (IEB), as the Chief Marketing Officer for IEB, effective 12/05/2011.

Yusuf and I have been discussing his career plan for several months, and we both felt with OSD and OABG’s success and momentum, the time is right for Yusuf to take on a new challenge for Microsoft. With more than ten years of service in Microsoft’s online services businesses, he has been a trusted adviser, a great leader of people, and has helped get us to where we are today in OSD. We are fortunate to have had Yusuf be an important part of OSD for the past ten years, and are equally fortunate that he is staying close, helping IEB continue its great momentum as it becomes a global entertainment brand for Microsoft.

Throughout my tenure at OSD, Yusuf has been a key member of the OSD LT and a trusted partner, from whom I have learned a tremendous amount about marketing, the industry, and Microsoft. I have thoroughly enjoyed working with Yusuf and I am confident he will do an amazing job for Don, and continue to be a great partner to OSD and a great advocate for Bing and MSN.

Yusuf has been involved with leading Microsoft Online Services businesses longer than anyone else on the OSD LT, and has been a pivotal leader at critical milestones of our division’s journey from the early days of MSN, to the original MSN and Live Search products, to the launch of Bing and the consummation of key strategic deals for OSD and MS, including Yahoo!, Facebook, Twitter and Nokia. Most importantly, he has built a world class marketing, business development, strategy, and product management organization that has made incredible contributions to the success of OSD and Microsoft. I want to take this opportunity to express my heart-felt thanks to Yusuf for everything he has done for OSD.

I have asked each of Yusuf’s direct reports to step up their contribution to help lead through this transition period. On an interim basis, all of Yusuf’s directs will now report into me. I have also asked that Mike Nichols help with coordination of the OABG ROB and represent OABG at the OSD LT level, in addition to maintaining his current responsibilities as GM of Bing Product Management.

Please join me in congratulating Yusuf in his new role, thanking him for his many contributions to Online, and wishing him all the best.

Thanks.
-Qi

From: Don Mattrick
Sent: Tuesday, October 11, 2011 3:33 PM
Subject: RE: IEB Global Marketing News

After 21 years of outstanding service, Mike Delman has decided to retire from Microsoft at the end of the calendar year. Mike’s decision will allow him to spend more time with his family. He will also continue his non-profit efforts with Children’s Hospital and lecture at the USC Graduate School of Business.

While there’s never a great time to lose a valued leader, the time is right for Mike and the business to transition as we embark on our next journey to significantly grow our business in the next five years.

Between now and the end of the year, Mike will lead marketing through our biggest holiday ever, continue to set us up for long-term success, and work with me and Janet Zimmerman to identify his successor.

Mike’s marketing contributions at Microsoft are innumerable — he joined Microsoft in 1990 as director of corporate communications, responsible for advertising, collateral, point of sale, direct marketing and worldwide packaging for the entire Microsoft product line. Mike later became the director of marketing for Microsoft EMEA. He also served as general manager of the MSN and managed worldwide marketing operations, data and analytics, advertising, relationship marketing and events in the Central Marketing Group.

In 2008, he joined IEB as the CVP of IEB Global Marketing. Here in IEB, Mike played an extraordinary role in redefining the marketing organization. Specifically, under his leadership, the marketing organization has deepened the connection between marketing and product development, reinvigorated our research and business intelligence efforts, and set the course for repositioning Xbox from a core games brand to an entertainment brand for everyone. Over the same time period, the Xbox business doubled. I also want to thank Mike for his leadership in working with the team in EMEA to drive growth and success in that region.

Please join me in thanking Mike for his years of great work, and a heartfelt congratulations on his upcoming retirement. He has always been a strong strategic advisor for me, and I look forward to spending the next few months together.

Best,

Don

In a blog post by one of its execs, titled “Flash to Focus on PC Browsing and Mobile Apps; Adobe to More Aggressively Contribute to HTML5,” Adobe said what had already been reported: That it would no longer be developing its well-known Flash for mobile devices.

Here’s the key graph:

“Our future work with Flash on mobile devices will be focused on enabling Flash developers to package native apps with Adobe AIR for all the major app stores. We will no longer continue to develop Flash Player in the browser to work with new mobile device configurations (chipset, browser, OS version, etc.) following the upcoming release of Flash Player 11.1 for Android and BlackBerry PlayBook. We will of course continue to provide critical bug fixes and security updates for existing device configurations. We will also allow our source code licensees to continue working on and release their own implementations.”

Last night, reports surfaced that the high-profile software company — whose Flash technology has been a flagship product — was halting development on the mobile version of its browser plug-in.

Now, Adobe will focus its PC Web browser business on tools that allow Flash developers to create mobile apps by packaging their code to run on Adobe’s AIR platform.

The move has big implications for Adobe going forward and also for mobile device makers, such as Google and Research In Motion. But not Apple.

As Ina Fried wrote:

“The move, if true, would be a major blow to Android device makers, who have long touted Flash compatibility as a key competitive advantage over Apple’s iPhone and iPad.

It would also mark a posthumous vindication for former Apple CEO Steve Jobs, who took a controversial stand by not supporting Flash on Apple’s mobile products.”

Turns out Jobs was prescient, as usual.

Here is the full version of the Adobe blog:

Flash to Focus on PC Browsing and Mobile Apps; Adobe to More Aggressively Contribute to HTML5

POSTED BY DANNY WINOKUR, VICE PRESIDENT & GENERAL MANAGER, INTERACTIVE DEVELOPMENT AT ADOBE ON NOVEMBER 9, 2011 5:59 AM IN BUSINESS PROFESSIONALS, CREATIVE PROFESSIONALS, DEVELOPERS, VIDEO

Adobe is all about enabling designers and developers to create the most expressive content possible, regardless of platform or technology. For more than a decade, Flash has enabled the richest content to be created and deployed on the web by reaching beyond what browsers could do. It has repeatedly served as a blueprint for standardizing new technologies in HTML. Over the past two years, we’ve delivered Flash Player for mobile browsers and brought the full expressiveness of the web to many mobile devices.

However, HTML5 is now universally supported on major mobile devices, in some cases exclusively. This makes HTML5 the best solution for creating and deploying content in the browser across mobile platforms. We are excited about this, and will continue our work with key players in the HTML community, including Google, Apple, Microsoft and RIM, to drive HTML5 innovation they can use to advance their mobile browsers.

Our future work with Flash on mobile devices will be focused on enabling Flash developers to package native apps with Adobe AIR for all the major app stores. We will no longer continue to develop Flash Player in the browser to work with new mobile device configurations (chipset, browser, OS version, etc.) following the upcoming release of Flash Player 11.1 for Android and BlackBerry PlayBook. We will of course continue to provide critical bug fixes and security updates for existing device configurations. We will also allow our source code licensees to continue working on and release their own implementations.

These changes will allow us to increase investment in HTML5 and innovate with Flash where it can have most impact for the industry, including advanced gaming and premium video. Flash Player 11 for PC browsers just introduced dozens of new features, including hardware accelerated 3D graphics for console-quality gaming and premium HD video with content protection. Flash developers can take advantage of these features, and all that our Flash tooling has to offer, to reach more than a billion PCs through their browsers and to package native apps with AIR that run on hundreds of millions of mobile devices through all the popular app stores, including the iTunes App Store, Android Market, Amazon Appstore for Android and BlackBerry App World.

We are already working on Flash Player 12 and a new round of exciting features which we expect to again advance what is possible for delivering high definition entertainment experiences. We will continue to leverage our experience with Flash to accelerate our work with the W3C and WebKit to bring similar capabilities to HTML5 as quickly as possible, just as we have done with CSS Shaders. And, we will design new features in Flash for a smooth transition to HTML5 as the standards evolve so developers can confidently invest knowing their skills will continue to be leveraged.

We are super excited about the next generations of HTML5 and Flash. Together they offer developers and content publishers great options for delivering compelling web and application experiences across PCs and devices. There is already amazing work being done that is pushing the newest boundaries, and we can’t wait to see what is still yet to come!

In a blog post aimed at developers, Facebook wrote: “We have begun working with a few developers to test the ability to offer Facebook Credits on websites, with the goal of helping them offer a more unified app experience to users beyond apps on Facebook.”

One of the first partners is GameHouse, a division of Seattle-based RealNetworks. GameHouse will be using credits for both Collapse! Blast and UNO Boost on its own game network at GameHouse.com. By integrating credits, GameHouse says players will now be able to switch back and forth between Facebook and GameHouse.com, while maintaining their scores and data.

“We truly believe that every game will be social someday, whether it’s played on Facebook, Google+, or at GameHouse.com,” wrote GameHouse in a blog post.

Since users will still log in to their Facebook accounts to play the games, technically the credits will be purchased directly from Facebook. GameHouse will still have to share 30 percent of the revenue from the sale of Facebook Credits, which is the standard cut on the social network.

GameHouse is one of the first to try using Credits off of the network, but there will likely be others following.

Earlier this month, Zynga announced Project Z, its own gaming platform, which will provide a seamless game experience between Facebook and its own Web site. Despite creating a separate game network, as we wrote at the time of the announcement, Facebook’s influence will be everywhere.

Zynga will use Facebook Connect to enable game players to log in and play the games seamlessly between Facebook and Project Z, and although it declined to comment on the use of Facebook Credits, we can imagine with this trial there will be a role for them on the new platform, as well.