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[–]rootb33r 2 points3 points  (0 children)


This is a great video.

It's also worth noting that pre-ordering doesn't really mean anything with respect to financial health of the developer. It's cash flow, but the company cannot actually recognize any revenue from sales until they "ship" (literally shipping the game, or they release it for download), and revenue is a really important thing for valuation purposes. It is, as TB mentioned, a decent source of data for financial models (for the purposes of investors, or other internal business decisions). Pre-orders can indicate a level of interest or a willingness-to-pay of a consumer which should feed into any good financial model.

I also think there are some additional considerations with respect to pre-orders. When speaking specifically about games which require company-run servers (MMO's and some FPS's), pre-orders are a great way to determine how to staff the IT teams and how much hardware to buy/lease. This can also be extrapolated to be representative of how much customer support is necessary.