Entries from February 2012 ↓

A history of the UK video game industry through my eyes. Part 2

So here is the second of three parts of a potted history of UK gaming through one pair of eyes. As first published on the Kwalee website. If you are interested in drilling down for more stories you can use the anecdotal musing button in categories in the right hand column here, or search for keywords using the box at the top of the right hand column.

 

Imagine Software was very profitable to begin with, the cassettes cost us well under 50 pence to manufacture and sold to distributors for between two and three pounds. We built up turnover during 1983 to a million pounds a month. So although the directors had nice cars the hire purchase payments on these used up very little of our cash flow.

Then in 1984 sales hit a brick wall and we suddenly had no income. It was as if someone had turned a switch. We employed quite a few Youth Opportunity Programme people and they told us that all their friends had stopped buying games, they were tape-to-tape copying instead. To double the problem, a number of illicit duplicators now had manufacturing equipment to counterfeit product to sell cheaply in markets.

One of our largest customers was the newsagent chain W H Smith. One day a truck filled with literally tons of our games appeared from them which Smiths told us were all faulty and they refused to pay our bill. We tested the games and they were all perfect, the kids were buying them, copying them and then returning them as faulty.

To try and prevent people copying instead of buying we tried many things, including writing a letter to all of the magazines, which some of them published. We wanted to bring the retail price of our games down but our big customers (W H Smiths, Bootsetc) wouldn’t let us. The “megagames” (Psyclapse and Bandersnatch) were an attempt to make our games copy proof by incorporating a “dongle” that plugged into the back of every customer’s computer. But we ran out of money before they could be completed and we went bust. Lots of other game publishers also went bust. We were particularly vulnerable because our development process was drastically under managed, so lots of staff created very little product which resulted in us being one of the first to go.

After Imagine, I went to see Barry Muncaster, the managing director of Oric and he offered me the job of managing director at their software house, Tansoft. He wanted to inject more excitement into the market for his computer. There were rumours that they had financial problems so I asked Barry if the job would be safe, he said that they couldn’t go bust because they were a subsidiary of a public company. Unfortunately I believed him and my new job did’t last very long. Working in Cambridge was very interesting because there were so many technology companies staffed by exceedingly bright people, but it was a desert for marketing. If we added some marketing competence to Cambridge we would have a British Silicon Valley.

At Tansoft I had met Bill Richardson of Oxford Computer Publishing, based in Chalfont, who published serious software for the Spectrum. Bo Jangeborg from Sweden was writing a graphics programme and Bill employed me to market it. But he sold it toTelecomsoft who published it as The Artist and I was looking for something to do again. Luckily one of his friends, Vic Cedar of Citadel Products, had a spare desk for me and I set up a company called Abbot to buy and sell computer related stuff using my contacts in the industry. Working at Citadel was fascinating because it was an early PC clone manufacturer and the workshops were always full of the very latest technology so I learned a lot about what made the IBM PC tick. At this time I started exhibiting at the ZX Microfairs held at the Royal Horticultural Halls in London, which were incredibly busy.

Then one day I saw a cheeky advert in CTW for a new game company in Banbury, set up by the Darling family, called Codemasters. I went up to see them and they asked me to work for them a couple of days a week. Within a month I was full time, in charge of marketing and I sold Abbot off. Back then Codemasters consisted of David and Richard Darling mostly managing product but also massively involved in the business side of things, their father Jim Darling (who today is the chairman at Kwalee) applying his vast business experience, sister Abigail running the office and Anne Pinkham ringing round the industry to generate sales.

Codemasters’ business model was to combat piracy by selling games at the lowest possible price. This meant that they were not worth copying and became impulse purchases at places like petrol filling stations. We came up with a very effective marketing strategy of telling the world that our games were full price quality at a budget price. This was very effective against the competition. Why buy a full price game when you can buy something of comparable quality for a fraction of the price? And why buy from one of the other budget publishers when you could buy a higher quality game from Codemasters? The £1.99 price point meant that we had to sell enormous quantities of games and that there was not much money to spend on marketing. So we concentrated our efforts and spend on marketing to the trade, with advertising campaigns in the trade newspaper CTW. To reach consumers we used public relations and went to the Lynne Franks agency (which the Absolutely Fabuloussitcom is based on). They got David and Richard on to lots of the weekend morning kids TV shows and into most of the weekend newspaper colour supplements. Within the first year of trading we had 27% of the total UK market by sales volume according to the Gallup charts, but in reality we were selling much more because we were selling vast quantities of games through outlets that Gallup didn’t monitor.

A lot of marketing effort went into trying to recruit other developers whose work we could publish. Andrew and Philip Oliver were the most prolific, churning out game after game, all to a very high quality. Most famously they developed the Dizzy series of games and today they run a large development company in Leamington Spa calledBlitz. Gavin Raeburn was another excellent game developer who is now development director at Playground Games in Leamington. Peter Williamson came from Scotland and created many titles. He is now Managing Director of Supersonic Software in Leamington. And so it went on, a panoply of young talent who went on to have a major impact on the game industry in Britain.

A history of the UK video game industry through my eyes. Part 1.

On the Kwalee website we are trying to be as open and informative as possible. Part of this means listing and profiling all the staff and doing Q&A sessions with them. To supplement this I wrote three articles that are a biographic look at the industry. Regular readers here will know that there is enough material for a book, so this is very much a compressed version.

Kwalee CMO, Bruce Everiss, talks about his experiences in the UK games industry. Starting at the very beginning.

In the early 1970s I trained as an accountant in Liverpool, because of wanting to be a businessman. There wasn’t the plethora of business degrees then so serving articles for the Institute of Chartered Accountants seemed to be the best way of gaining a broad business-based knowledge. After this I became a Managing Director, running a computerised book-keeing company called Datapool Services, which is still going! In those days the only computers were vast and enormously expensive machines owned by government, universities and big business. So our book-keeping was done on time rented from a big bank computer.

During this time I started reading the two computer industry newspapers, Computer Weekly and Computing. Occasionally they carried articles about the amazing idea that an individual person could own a computer and have it at home, using a kit of electronic parts centred around the only recently available microprocessors. Then came news of people actually setting up retail stores to look after the people who were interested in these products. I knew that this would explode in popularity and decided to do the same. I begged, borrowed and stole the money to set up Microdigital in Liverpool in 1978, one of the first computer stores in Europe. Most British people couldn’t afford the expensive American home computers, but luckily we had a home grown device called the Nascom 1, which cost £200. This was a kit with 1,200 solder joints and which gave users a massive 1K of RAM to play with. We created a very successful business fixing kits that people had built but which had failed to work.

For rich people we sold the Apple 2, which had 16K of RAM for £1,200. This was a fortune in those days and used a cassette interface to input and output content. Eventually Apple brought out a disk drive that cost £425 and which had a capacity of 113K. Everybody thought that this was incredible.

Over the years we sold many other machines: the Commodore Pet, the Science of Cambridge MK14 (from Uncle Clive), Exidy SorcererHewlett Packard HP-85Sharp MZ 80K and more.

Getting hold of stock to sell was problematic, as the demand was so much greater than the industry could possibly keep up with. It was not unusual for our turnover to double month on month. Our bread and butter was selling books, which we imported from America, to satisfy the thirst for knowledge. We set up a mail order department and pretty soon we were shipping stuff all over the world. We also set up our own monthly computer hobbyist magazine called Liverpool Software Gazette and used our extensive contacts to fill it with excellent articles.

During this time I went to America a lot, they were well ahead of us and were the place where the products and ideas were coming from. On one visit to Apple in Cupertino, California, I was offered their UK distributorship but turned it down because I knew we just couldn’t handle it. On these trips I also visited the early computer stores, such asComputer Components of Orange County. I noticed they had some polythene bags attached to a noticeboard containing a cassette (or disk) and a sheet of photocopied paper in each one. These were the very first commercially available home computer video games that people had written and duplicated at home to sell on the noticeboard. I bought loads of them and brought them back to use as demonstration software in the shop.

Eventually I sold Microdigital out to a large chain of Hi Fi retailers called Laskys for them to use us as a template to put computer stores within their shops all over the country. Then there was a phase of consulting. I did the business plan for a home computer industry magazine for Felix Dennis at Dennis Publishing, this becameMicroscope. I did a pile of stuff for an office equipment company in Liverpool calledDAMS and I did some work for Bug Byte. This was fascinating, one of the very first home computer game publishers in Britain. I managed to convince them to upgrade their cassette inlay cards from crude mono sheets, sometimes photocopied, that were the industry standard, to professional four colour printed cards with an airbrush image to represent the game.

Then, in 1982, one of my former Microdigital Employees who worked at Bug Byte, Mark Butler, told me he was setting up his own company with a programmer he worked with called David Lawson. I joined them as Operations Director at Imagine Software and took over marketing, amongst other things. Then Eugene Evans joined us who had been a Saturday boy in the Microdigital shop before working for Bug Byte. Eugene is now VP, Studio GM, Bioware Mythic, at Electronic Arts. Back then there was no proper video game industry. Most people who wrote games ran their business from home (often part time) and sold directly to customers by mail order. We decided to do it differently with a proper company with departments and offices. Our first problem was getting sales. I remember sitting with everyone else on the carpets, packaging up games to go in the mail and then filling rows of mailbags up. This was no way to go. So I recruited a couple of tele-sales staff from DAMS (something that was then new and which I had learned there). They were given every Yellow Pages for the UK and they rang retailers telling them to stock our games. This was the foundation of video games as an industry in the UK. They would ring every newsagent, then every electronics shop, then every photographic retailer, doubling turnover every month. Obviously once a retailer started selling games they would look for more to sell and would contact our competitors. So the industry moved from a mail order hobbyist footing to professionally run companies selling their products at retail.

After a while I recruited two more tele-sales staff. One who spoke French and German fluently and one who spoke Spanish and Italian fluently. Then we sold our stuff like crazy all across Europe. This was the beginning of the dominance of the British video game publishers in Europe. At the same time we developed our inlay cards adding more and more folds and on these we put development credits, company profile, sales material for our other games and translations for our overseas customers.

Games originally were written by one person using assembler software and writing on the target machine. The first improvement was when John Gibson was having difficulty getting the clouds to look realistic in Zzoom. We dragged an artist in and using a piece of graph paper he represented pixels and created realistic clouds. David Lawson seized on this and soon we were employing artists, then he extended the concept and we were employing musicians. Then we looked at getting away from using the target machines and bought very powerful 68000 based professional computers running Z80 assemblers. Then we started to move over to the C programming language.

So throughout the life of Imagine software we continued to lead and innovate in many ways. What we did was very widely copied. The reason we had to be creative was because nothing existed before us, we were the pioneers in many ways.

 

Kwalee progress report

I thought it would be a good time, now the company has been going about 6 months, to give you an update on how everything at Kwalee is coming along.

Brilliantly is the answer, in as far as it can be without launching a product. Everything is moving along as planned. Overall the big thing has been climbing lots of learning curves. The development and marketing of mobile apps is a lot different to making and marketing boxed console games.

Initially the app market seems to have a low barrier to entry. Many apps have been written in less than a day and it costs $95 to become an Apple App Store publisher. However when you try to market and sell your product you discover what the true barrier to entry is. Basically the App Store is the most competitive market that has ever existed on planet earth. There are around three quarters of a million apps with over 600 new ones being added every day. How do you get noticed amongst that without spending a fortune?  What has happened is that marketing has become more important than at any time previously in the history of the video game industry. Marketing is the key strategic differentiator between apps. It is the golden age for the application of the full range of marketing skills.

The first thing we had to do at Kwalee was recruit our staff. You can see what we have done in the people section of the Kwalee website. David Darling was immensely, incredibly fussy about who he took on. And the result is an utterly fantastic team. But then if you have the right people you can get everything else.

The games we are developing have a number of distinctive features. Some of these have been used previously by other games, but they are not common. Also we are working around the freemium business model. As in many things we do we are on steep learning curves and it has been interesting developing our own technology to perform the features. Our first game (code named Vegemite), which will incorporate this, is still about two months away. Whilst it is an excellent game it has also served as our technology development mule and has given us a whole pile of skills that will go into future games.

From a marketing perspective the website is very important as we build our brand and communicate with the world. We started with a placeholder but now there is an excellent Kwalee website. We are putting a lot of content on it to try and keep it fresh and interesting. We are following a policy of being as open as possible and of showing people as much of the workings of the company as we can. Also we view marketing very much as a two way street and are very keen indeed to receive any feedback.

To do all the marketing work we have taken on some very keen and bright young staff who bring a whole pile of skills to the company. Lizzie Stabler is Brand Evangelist and her work involves dealing with the press as well as applying her special skill at making videos, something the website is already benefiting from. Joe Barron  is Community Evangelist and his work is to deal more directly with people by using social media and all the other tools available to him on the internet. He has a game journalist background which helps a lot when he tries to relate what we are doing.

Even with nothing launched yet we are very busy indeed, with a backlog of two month’s worth of weekly press releases and another backlog of videos that need making for the website. We are determined to do everything we can so that we have a polished marketing ecosystem in place when Vegemite is launched.

 

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