Game industry tax breaks questioned

President Obama hopes to finance his recently proposed $447 billion jobs plan by, in part, eliminating tax breaks given to large oil and gas corporations. However, according to a New York Times report, even the oil industry has raised its eyebrows at the generous tax incentives granted to the video game industry.

Game industry tax breaks are some of the best in business.

The report notes that the incentives amount to various deductions, write-offs, and credits that were largely aimed at bolstering other industries during different eras. However, game companies stand in a unique position to capitalize on these breaks because of the way they straddles lines between the software development, entertainment, and online retail industries.

As tax return forms are not publicly disclosed, it is not possible to tell how much game companies pay in federal taxes and how that compares to the US corporate rate of 35 percent. However, speaking to the New York Times, Treasury Department veteran and University of Texas tax professor Calvin H. Johnson believes that the game industry is one of the most heavily subsidized businesses in the US.

As a direct example of how these tax breaks aid the industry, the article points to Electronic Arts. During the past five years, the company reported that it brought in $1.2 billion in operating profit worldwide. However, due to various (and entirely legal) accounting techniques, such as deferred revenue and executive stock option deductions, the company has reported a loss for those years.

The report goes on to note that EA paid only $98 million in taxes during the period, which equates to about an 8 percent tax rate. The publisher also told the New York Times that about 50 percent of its revenues are generated outside the US.

"EA is a global company with a majority of our customers and roughly 50 percent of our revenue generated outside of the United States," EA VP of corporate communications Jeff Brown told the paper. "Naturally we hire, build facilities, copyright our trademarks, invest, and pay taxes in countries outside of the US."

Industry-lobbying group the Entertainment Software Association has in recent years spent roughly $4 million annually in Washington to, among other concerns, maintain and increase tax breaks for game companies.

It is unclear as to why EA is the sole gaming company referenced in the article, though the report does state that the publisher's "competitors acknowledge that its tax strategies aren't particularly aggressive compared with others in the industry." The article's author had not responded to a request for comment as of press time. EA and the ESA declined to comment on the report.

Metallic rose DSi XL blooming September 18

The 3DS may be in the midst of a turnaround, but that isn't keeping Nintendo from continuing to support its DS/DSi line of portables. Today, the Japanese game company announced it will be releasing its DSi XL in a new metallic rose color on September 18.

Nintendo's DS becomes pretty in pink, again.

Nintendo has previously released the DS Lite with the metallic rose shade in 2008. The publisher described the color as "an eye-catching shade of pink with a luminous modern sheen," playing up its fashion-accessory potential with kids and adults. As with the bronze, midnight blue, and burgundy DSi XL models, the metallic rose edition will carry a $170 price tag,

The metallic rose DSi XL release coincides with that for the latest outing of Nintendo's iconic pink puffball in Kirby Mass Attack. Scheduled to arrive on September 19, Kirby Mass Attack has been billed as a side-scrolling real-time strategy game, in which players attempt to guide an amassed army of Kirbys to safety.

Blizzard three-year plan includes two World of Warcraft, Starcraft II add-ons

Blizzard Entertainment is notorious for not committing to a release window until it is absolutely sure the game is done. However, the studio remains but one among the Activision Blizzard umbrella, and its corporate partner is expecting Blizzard to release a number of products over the next three years to grow the publisher's top and bottom line.

Tippl believes the Starcraft II trilogy will conclude by 2014.

Speaking at the Citi 2011 Technology Conference today, Activision Blizzard COO Thomas Tippl said that over the next three years, the publisher is expecting six "proven property" releases from Blizzard. These releases include two expansion packs each from World of Warcraft and Starcraft II.

While Blizzard has not indicated any expansion pack plans beyond WOW's Cataclysm, it has been more forthright with its Starcraft II plans. The game's second installment, Heart of the Swarm, focuses on the Zerg faction, andBattle.net project director Greg Canessa indicated it will be available in mid-2012. The series will conclude with Legacy of the Void, which focuses on the Protoss camp.

The remaining two releases pertain to Diablo III. While Blizzard maintains that it hopes to release Diablo III in 2011, Tippl said that the game has not been factored into its earnings report expectations for the calendar year. Tippl also expects that a Diablo III expansion will be available before the end of 2014.

Of course, Tippl's word choice also left the door open for Blizzard to release an as-yet-unproven property in the next three years, namely its newest massively multiplayer online role-playing game, Titan. According to a purportedly leaked, and thus far accurate, release schedule, Blizzard is planning on releasing Titan in fall 2013.

[UPDATE] For its part, Blizzard is maintaining a veil of secrecy on its upcoming lineup. "We haven't made any announcements in regard to plans beyond our current slate," a Blizzard representative told GameSpot. "Currently, we are focused on the next content update for Cataclysm, the upcoming release of Diablo III, and continued development on Starcraft II: Heart of the Swarm."

3DS sales soar 260% in August

Nintendo took drastic action in August to breathe some life into the 3DS. Suffering from anemic demand since its introduction in March, the $250 3D-enabled handheld became the $170 3D-enabled handheld in the US. The good news for Nintendo and its third-party partners is the price cut seems to be having its desired effect.

The 3DS showed signs of life in August.

As part of NPD's US retail sales report today, Nintendo announced that, following the price cut, 3DS sales in August were up 260 percent over the comparable 19-day period in July. All said, the 3DS sold 235,000 units during the month, making it the second-best-selling gaming hardware during the month.

Of the 3DS's total hardware systems sold during the month, 185,000 came after the August 12 price cut. Those who purchased the system at the $250 price point prior to August 12 gained access to the Nintendo 3DS Ambassador program, which awards more than 20 free games from the handheld's eShop. Nintendo also said that it sold 190,000 Wiis in August as well as 165,000 units in the DS/DSi family.

Sony, on the other hand, appears to not have received as significant a bump for the PlayStation 3 following its $50 price cut on August 16. However, that situation may be due more to supply constraints than consumer apathy.

"Despite inventory constraints at retail during the first half of August, PS3 hardware sales were very strong the last two weeks of the month following the $50 price cut and the new Infamous 2 bundle," Sony said in a statement. The company did not reveal hardware sales figures for the console.

As for who topped the hardware charts for the month, that distinction goes to Microsoft's Xbox 360. With 308,000 consoles sold during August, the Xbox 360 has now been the best-selling gaming hardware in the US for 14 of the past 15 months.

Max Payne going mobile this fall

Rockstar Games' pill-popping protagonist is going portable. The publisher today announced that a high-definition version of the original Max Payne will be released for unspecified mobile devices this fall, complete with customizable controls and Rockstar Games Social Club features.

Keep making that face and it'll stick that way.

Originally released in 2001, Max Payne was a third-person shooter that featured a "bullet time" gameplay mechanic, slowing the world to a crawl while allowing players to aim and fire at enemies at full speed. The game follows the titular antihero, a modern-day New York undercover cop whose wife and baby daughter are brutally murdered. On top of that, Payne is framed for a fellow cop's murder and becomes the subject of a massive manhunt by the police, the Mob, and a shadowy criminal organization.

The first two games in the series were developed by Remedy Entertainment, which has since moved on to create Alan Wake for the Xbox 360. Max Payne 3 development is being handled by Rockstar Vancouver, the studio behind the 2006 action adventure game Bully.

Super Monkey Ball rolling to PlayStation Vita in early 2012

Super Monkey Ball is rolling to new territory next year. Sega today announced that its long-running minigame and maze adventure game will be launching on Sony's new PlayStation Vita handheld in early 2012.

[Caption omitted for reasons of taste.]

Designed around the new hardware's features, the PS Vita version of Super Monkey Ball will make use of the handheld's tilt-sensitive motion controls, dual analog sticks, and both front and back touch screens.

The game will feature the series' familiar mix of maze challenges where players must traverse treacherous courses, collecting bananas en route to each levels goal, as well as a variety of minigames. Sega has not detailed all such minigames, but it did say the game would see the return of Monkey Target, as well as some new additions to the series.

The Monkey Ball series has become a handheld gaming staple over the years, appearing on the Game Boy Advance, N-Gage, DS, 3DS, iOS systems, and Windows Mobile phones. For more on the latest installment, check out GameSpot's review of Super Monkey Ball 3D on the 3DS.

GameStop launches iOS device trade-ins

GameStop isn't likely to get much value out of an Angry Birds trade-in, but the world's largest gaming retailer is seeing potential out of the iOS devices that the wildly popular mobile game runs on. Today, the world's largest gaming retailer announced that it has launched a trade-in program for used iOS devices, whereby gamers can get cash or in-store credit for their used iPads, iPhones, and iPods.

GameStop is willing to pay as much as $200 for your old iPhone.

Beginning today, GameStop has begun accepting any generation of Apple's iPad, iPhone, iPod, Mini, Shuffle, or Nano devices at select stores in the US. For their hardware, gamers will be offered cash or in-store credit.

A number of conditions apply. Device casings must be free of dents, "severe" scratches, and personal engravings. The retailer will also turn down devices with a cracked or severely scratched screen and those that do not power on, have an unreadable screen, or that are in any other way defective. Devices with water damage are also out.

In its announcement, GameStop did not indicate how much it would pay out for acceptable iOS devices, saying only that the value is "significantly higher than typical game trade-ins." GameStop's corporate office declined to disclose trade-in values.

However, a San Francisco-based GameStop store told GameSpot that a 32GB iPhone 4 is eligible for $200 worth of in-store credit or $160 in cash, and a 32GB iPhone 3GS is worth $140 in credit or $112 in cash. Meanwhile, Apple's iPad carries a trade-in value of $350 or $200, depending on the hardware configuration.