Activision bets on Destiny being massive hit to the tune of half a billion dollars

Activision is spending half a billion dollars on Bungie's Destiny with an eye on doubling its money and setting up a new franchise that it hopes will top games charts for many years to come.

The $500 million it has allocated to the game includes "marketing, packaging, infrastructure support, royalties and other costs" but is still seen as an enormous gamble on a new intellectual property by some. It is believed to be a record sum spent on just one game.

READ: Destiny gameplay preview, trailer and screens

However, Activision has a 10-year contract with Halo-creator Bungie that gives the software publisher worldwide distribution rights and control over the franchise's development.

"If you're making a $500 million bet you can't take that chance with someone else's IP," said Activision CEO Bobby Kotick. "The stakes for us are getting bigger."

READ: Bungie releases 7-minute Destiny gameplay trailer of The Devil's Lair cooperative Strike mission

Analysts predict that Activision will sell eight million units of Destiny worldwide - far shorter than the 32.5 million copies of GTA V sold to smash records last year.

"It's a head scratcher," said Sterne Agee analyst Arvind Bhatia to Reuters. "For brand new IP, it's tough but it could post a big surprise."



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