Entries from December 2008 ↓

In order to be more sociable and to create an area for people with the common interest of the games industry I have started a Facebook group for Bruceongames. It is open for anyone to join, so please do. Just put Bruceongames in your Facebook search window. See you there!

Firstly if you want web traffic you need the search engines to index your site. And the search engines look for keywords. So it is really useful to know the keywords that people are using in their search queries. Google release a lot of this information in Google Zeitgeist. Using this could make your website a lot more successful.

Secondly there is a lot of useful information you can find out about a website but it takes ages to do so. Firefox SEO does it automatically to every item on a Google search. This really is a very powerful tool indeed and will give you so much marketing information that you probably didn’t have before. Here is what it looks for: PR: ? | Google Cache Date: ? | Traffic Value: ? | Age: ? | del.icio.us: ? | del.icio.us Page Bookmarks: ? | Diggs: ? | Digg’s Popular Stories: ? | Stumbleupon: ? | Twitter: ? | Y! Links: ? | Y! .edu Links: ? | Y! .gov Links: ? | Y! Page Links: ? | Y! .edu Page Links: ? | Technorati: ? | Alexa: ? | Compete.com Rank: ? | Compete.com Uniques: ? | Trends | Cached: ? | dmoz: ? | Bloglines: ? | Page blog links: ? | dir.yahoo.com: ? | Botw: ? | Whois | Sktool | Yahoo position: ? | Majestic SEO linkdomain: ?

In any organisation the customer is king and it is therefore vital to give them the best experience possible. They can always take their business elsewhere. So I have made a habit of testing the customer systems of companies I have been a manager at. By pretending to be a customer you get the customer experience and can then fix any problems. With this in mind I am now going to have a rant.

Last night I booked a holiday with Lastminute.com giving them all the payment details and received a confirmation email. This morning I received a phone call from someone who said he worked for the holiday operator and could he please have my email address and the 3 numbers off the security strip on my debit card, details I had already given last night in my confirmed booking. Obviously I said no.

I then rang Lastminute.com and got their robotised phone system. It asked me repeatedly for my order number which I typed in straight off the screen, it kept telling me it didn’t recognise it (obviously their booking computer and phone computer systems don’t talk to each other very often). In the end it said OK we will proceed without the number, it then asked me for the departure date. Whilst I was looking for this it said it was terminating the call and cut me off!

So I tried again. This time I told the robot that I didn’t have the order number and I had my departure date to hand to get it in quickly before I was cut off. I then answered the questions as well as I could “Have you already booked a holiday” etc and it put me in a queue for 5 to 10 minutes of the normal waffle. A gentleman then answered the phone and asked me a lot of security questions he then told me he couldn’t help me before I even told him what the problem was. He then put me in another queue for another 5 to 10 minutes of waffle before I got another gentleman who asked me all the same security questions. Then when I told him the problem he put me through to the person who phoned me this morning!

As you can see their procedures are full of holes. The confirmation email doesn’t say what it should. Their system for dealing with payments and their suppliers doesn’t work properly. Their computers don’t work properly. Their robot phone system is a shambles etc etc. It must be costing them millions in lost business. I have a choice and whilst I am not saying never again to Lastminute.com, they will certainly be the last service I check with in future. There is always Expedia, for instance.

I am amazed that the management at Lastminute.com allow this mess, they must surely know about it from customer feedback. Self evidently they don’t value customers as highly as I do and as you should.

There is suddenly a lot going on. Enough for this bonus edition.

• Korean government to invest $200 million in gaming. They want to become a world force in the industry. A repeat of their policy with steel making, consumer electronics, ship building and car manufacture. And precisely what the Canadians are doing. These guys understand what is happening in the world. Yet still the British government don’t get it. For a small fraction of what they have spent bailing out incompetent bankers they could have built a thriving, world class games industry in Britain. Instead they do everything they can to thwart us. Amazingly gaming in the UK does not even get the benefits that the film industry gets. And Keith Vaz is given credibility when he spouts half truths to the House of Commons.
• Xbox 360 attach rate is 8.1 games. This is remarkable when you consider how many millions of these machines were only recently bought. And 360 third party games generate more turnover than the Wii and PlayStation PS3 combined. No wonder so many publishers are voting with their feet when it comes to choosing which platform to support. Once you discount the occasional, casual, “toy” user Microsoft are winning this generation hands down.
• Microsoft Live Arcade sales have tripled since the revamp with NXE. That is an amazing success story. Live now has 14 million members. People think I have a bias towards Microsoft. But I don’t. I am only reporting it how it is. And Microsoft’s success in this console generation is quite simply staggering.
• In a survey of 4,500 teens on Habbo the Xbox 360 came top of the Christmas wish list. With a third more votes than the PS3. And just beating the soar away Wii. And all three consoles beat the iPhone. This is a good bit of research because it is a large sample size, geographically dispersed, of one of the key demographics.
• EA stock falls nearly 25% in two days, from an already stupidly low position. And we all know why. The company is now worth less than five and a half billion dollars. This puts a huge amount of pressure on John Riccitiello to do something drastic to sort the company out. We may yet see more interesting new coming from this quarter.
• Ubisoft looking at three acquisition deals worth about 5 million euros each. So these will be for fairly small developers. Not Codemasters or Eidos. But it is indicative that the game industry is still in full M&A mode. And also that Ubisoft are building on their fantastic success with acquisition growth as well as their prodigious organic growth.
• Playing video games improves elderly brains. This is pretty much what you would expect and builds on previous research. And is all the more reason for politicians and newspaper editors to be forced to play them.
• 5 reasons Disney should buy Electronic Arts. It is nice to see that the financial experts are coming round to what this blog has been saying for a long time.

It’s happening pretty much worldwide. Less and less people are watching television. So there is less advertising revenue (and the recession just makes this worse), so there is less money to spend on making programmes. Except at the BBC where every British household is forced to give them money, so they are the last bastion of wildly overinflated salaries. Not just for their legions of executives but also for their coterie of foul mouthed yob presenters.

The demise of TV is because it is old technology. Quite frankly I find it pretty boring these days. They just cannot compete with computing, the internet and gaming. And they cannot compete because they are not interactive (except in a farcically limited way), they do not connect the user with other users and their content is purely linear. Their main market now is the educationally subnormal,  geriatrics and babies, because these are the only people left who aren’t online.

TV executives have been glacially slow to react. The only gem is the BBC’s world class website. But there is just so much they could have done. For instance why can’t I watch any TV programme ever made, on demand when I want it, financed by micropayment? It would be great to come back to the pub for an episode of the 6 Million Dollar Man, Charlie’s Angels, Monty Python or the Goodies. The technology is there to do this, we have the server farms, it would bring money into the coffers of the TV industry. But they are moribund. Bogged down in a previous age.

This isn’t the only way the TV executives have been inept. They are sitting on a goldmine of intellectual property. But they can’t be bothered mining it, or they don’t know how to. If the TV industry aligned itself a lot more closely with the gaming industry they could make a fortune. And I don’t mean with half baked shovelware licensing deals. I mean with entertainment products that integrate television and gaming, playing to the strengths of both. You could do amazing things with Dr Who for instance. Episodic content and user generated content would work fantastically.

And so we come to this amazing news. Sky TV are exploring using consoles to stream their content. Wow. I bet you are all jumping up and own with excitement. It is a pity really as Rupert Murdoch is in a prime position to put television back on the map by doing something really good to align it closer to gaming. But don’t hold your breath. Television as an entertainment medium is in intensive care and the condition looks terminal.

• Details of the ten most pirated PC games of 2008 have been released by TorrentFreak, it gives some idea of the sheer volume and value of what is being stolen. No wonder the boxed standalone PC game is becoming extinct.

• Nintendo sell 800,000 Wiis in one week in USA. An amazing feat, just the logistics involved are impressive. At this rate Nintendo will have to launch a new machine because every American household will have a Wii.
• Analysts says that the Sony Playstation PS3 is vulnerable in an economic downturn as customers become more price sensitive. And the Nintendo Wii is vulnerable because its more casual gaming is a discretionary luxury. So it looks like 2009 will be Microsoft’s year.
• Konami launch teaser site that hints that Metal Gear Solid is coming to the Microsoft Xbox 360. This makes commercial sense if you look at the relative sales figures of the consoles. The industry will not exactly be surprised if/when this is officially announced.
• Sony to cut 8,000 jobs. And 8,000 contractors, so the total is 16,000. Sony just had a 90% fall in quarterly profits and warned of full-year earnings down 58%. What can you say? Difficult times call for difficult measures.
• Sony launches PS3 Home today and Trip Hawkins is not impressed:  “What I can’t really tell yet about the various announcements made about online and what they’re doing so far, I can’t tell whether they’re going more towards this mass market idea – the way I’m describing this ‘omni-market’ – or if they’re being lured into essentially trying to compete with Warcraft or Second Life. My own personal opinion is: if Sony makes Home feel too much like a Warcraft environment, they’re just never going to create the kind of audience size that you’re going to see Nintendo and Microsoft create. Because clearly Nintendo is orientated towards the mass audience, and even Microsoft has learnt a lot of valuable lessons from things like Xbox Live Arcade.”
• Lots of Zune rumours. Mainly that it will feature in Steve Ballmer’s CES speech on 7 January. Some say that it will be the Zune phone, others that it will be a big gaming announcement. Already the Zune has features and benefits that the iPod doesn’t. But still Microsoft need to catch up in the perception of the market. As Zune is a cornerstone of their long term strategy they will stick at it till they win.
• The Nintendo DS has broken the all time UK one week console sales record. And that is without counting all the counterfeit machines. Yes, now they are stealing the consoles as well as the games!

I am a great fan of John Riccitiello, he talks the talk and says more sensible things than just about any other game industry manager. More than that he has instigated a boutique, mix and match approach to working with developers which gets the best out of them. A massive improvement from EA’s previous policy of assimilation which tended to result in squandering the assets they had bought.

He has gradually (maybe too gradually)  moved EA away from relying on other people’s IP with licensed games towards a more sensible policy of creating their own, original IP. And he has gone after product quality. Whereas once a lot of what EA produced was little more than shovelware, now they are in a position where much of what they produce is critically acclaimed. Riccitiello is a great believer in getting high Metacritic scores.

Yet despite this Electronic Arts, as a company, are underperforming. The industry as a whole is booming like crazy yet EA are delivering lackluster results both in terms of growth and in terms of profit. Meanwhile competitors like Activision/Blizzard and Ubisoft have been massively outperforming.

This hasn’t escaped the attention of the analysts. Wedbush Morgan’s Michael Pachter thinks that EA will have a 16 percent year on year decline in revenue. At Lazard Capital Markets  Colin Sebastian says: “Specifically, we believe several EA titles are tracking below plan at retail this holiday, including Need for Speed Undercover (with disappointing reviews), new franchise Mirror’s Edge, and Rock Band 2. We believe further cost and franchise reductions are likely. Importantly, we believe EA is continuing to review its cost structure and franchise base, and it is possible that management will announce further cuts in headcount and the development pipeline (including existing franchises) over the coming quarters.”

So what is going wrong? Here are some areas where, from what I have heard and seen, EA may be weak:

• Too much and too expensive management. Every time EA get into a bit of trouble they have a cull of development staff (who make the games). We never hear of them flattening their management hierarchy or reducing management perks. There are ways of successfully running big organisations with a minimum management infrastructure. It has been done before and there are many examples I could point EA at.
• Inefficient development processes. EA are notorious for making their development staff work long hours of “crunch” to get games out on time. They shouldn’t get themselves in this position and “crunch” is a notoriously inefficient method. But it is typical of the stories I have heard from within EA of very large teams being run very inefficiently. Perhaps they could take a lesson from Ubisoft’s low cost global development. Or from the far smaller team sizes that you find in most independent developers.
• Unimaginative, steamroller marketing. It is almost as if the marketing team are given a budget and then work out how to burn through it with the least effort. Totally uninspiring. This is the entertainment industry and the marketing we do should reflect that.

It is a great pity that EA are being forced to retrench at a time when the industry is booming and they should be investing in growth. This is a massive corporate underperformance. I see this as making it even more likely that EA becomes a takeover target. There are several suitors around who could easily afford it and who would bring efficiencies of synergy that could once again see Electronic Arts leading the way.