Entries Tagged 'Opinion' ↓

In the past Electronic Arts developed a reputation of buying up smaller but very highly talented development companies and assimilating them into corporate EA, whereupon the spark of inspiration would be lost. This was bad business because time after time the investment was wasted. And the underlying problem is that this is a creative industry so you have to foster that creativity and let it flower.

Obviously EA want to bring a flow of superior product to market so they have cleverly worked out how to get the best out of developers. Basically they use a mix and match bespoke policy with each developer, which contrasts strongly with the one size fits all policy they used before. Each developer gets what they need from EA, no more and no less. If they want to be owned by EA then OK, if they don’t want to be owned by EA that is also OK. If they just want money, fine. If they just want marketing that is also fine. What matters is nurturing the creativity to create great games.

David DeMartini runs their partners programme with a staff of sixty. He says: “EA looks at the top 20 developers in the world and we try to sign anything those guys are working on.” Speaking to developers of all nationalities will bring a global feel to EAs catalogue. Most recently, for instance, he has recruited Resident Evil creator Shinji Mikami working with developer Suda 51, which has to be a feather in his cap.

This whole operation is vastly more sophisticated than anything any other publisher is doing. It promises to bring the very best talent under the EA umbrella (in one way or another) and so bring EA the very best games being made. The payoff won’t be quick and they will have failures as well as successes, but over time this policy must work to consolidate and enhance EAs position as one of the top global publishers, even in the face of the global entertainment media giants muscling into the market.

Firstly let’s look at how the numbers stack up. According to the best guesses there are about 30 million Nintendo Wiis in the world, 20 million Microsoft Xbox 360s and 15 million Sony Playstation PS3s. So the Wii has currently sold 50% more than the 360. And 10 million is a lot of units to make up. Here is how it will happen:

• As this site has been predicting for a long time the Xbox 360 is now $199. This is the price point at which historically 75% of consoles sell. However the 360 has got to this point very early in its life, so far, far more than 75% of 360 sales are yet to happen. Currently the Wii is above the magic $199 price point, expect it to come down as predicted here. But even at a new, low, price point the Wii will have difficulty in perceived value against the Xbox 360.
• Sony are making massive losses on the PS3 so cannot bring the price down. All they have been able to do recently is pass on lower hard drive prices by giving customers bigger drives at the same price. As the PS3 and the Xbox 360 are very similar in their capabilities Sony will now lose a huge number of potential sales to the Xbox 360.
• The Wii is for many people little more than a glorified toy. It is just a box for playing Wii Sports or Wii Fit. If these people want proper gaming they will buy a 360.
• The 360 has by far the best catalogue of games in this generation. This is because they launched first, because it is far easier to develop for than the PS3, because Microsoft have invested a lot in exclusives and because 360 owners buy more games than owners of the other consoles. The Wii has some brilliant first party exclusives, but these are relatively few and most third party games are little more than shovelware.
• The Wii is very stunted in capabilites being largely just an uprated gamecube. It’s capabilities are far behind those of the Xbox 360. This is especially damaging in the lack of HDTV support and a hard drive. Comparing the two machines side by side is like looking ar a Ferrari next to a bicycle.
• The Wii is going to have a very short production life, perhaps four years, before it is replaced by a SuperWii that will correct its weaknesses. The Xbox 360 is going to be in production for at least eight years, the last half of that life as the low cost partner to the Xbox 720 (Phoenix) in a two model range. So the 360 has a long time to catch up and overtake the Wii for total sales.
• The 360 is being engineered into a single chip (+memory) combining the GPU and CPU. The effects of Moore’s Law are such that this will become cheap enough to incorporate into televisions, which Microsoft seem to be gearing up to do. Nintendo have no chance here with the Wii, who would want a non HD console built into their HDTV?
• The Xbox 360 has Xbox live which is by far the best online gaming portal there is. Microsoft have built a formidable USP here and are not about to lose it anytime soon. They will invest what it takes to keep their online offering well ahead of those of its competitors. So great will the power of live become that every keen gamer will be forced to buy the hardware necessary to access it, just so as to remain a viable member of the gaming community.
• Microsoft have now made the Xbox 360 commercially viable in Japan by creating the games that the Japanese want. This is a huge turnaround and adds a lot to the potential total sales of the console.

The success of the 360 goes against Microsoft’s traditions, normally they wait for the third iteration of a product to become the market leader. And of course if you add the sales of the Wii to the sales of the SuperWii then Nintendo have the potential to still end up ahead.

Last year the global growth in video gaming was vastly more than even the most optimistic analyst predicted. So they upped their estimates for this year. And again the growth is vastly outstripping any one’s wildest dreams. So what has happened to cause this?

• Nintendo have been brave enough to create a succession of games intended for non traditional (or sometimes broader) demographics. Far more than this, they have been even braver and put big marketing spend behind these games so as to reach these demographics. This has been a massive unleashing of the potential that is interactive entertainment.
• We have escaped from the Sony monopoly. By dominating the market for the PS1 and PS2 generations they had no need to compete or take risks. So they held the market back for over eight years, which is several lifetimes in this industry. Capitalism and competition is great. But when it is hogtied, as happened during the Sony monopoly, everyone loses.
• We have three platform holders going for it. Sony, Microsoft and Nintendo are now each investing billions and using the best brains that they can find both in product and in marketing so as to fight a three cornered console war. The stakes are enormous, this industry is still at its very beginning. Interactive entertainment will grow to be bigger than film and television combined. As in any war we see great advancement. World war two started with biplanes and finished with jets, in just six years. The same leap is happening in gaming right now.
• MMOs mature. This has been an incredible phenomenon. MMOs have gone from text to 2D graphics to 3D graphics to immensely complex alternative existences with hugely powerful social networking. At the same time with games like Habbo, Runescape and Maple Story they have sought out new demographics. There is now a range of MMOs for everyone. But still it is just the beginning. The genre is held back by its dependence on sword and sorcery themes. And commercially by the supposed $1 billion price tag that would be needed to take on World of Warcraft.
• Casual gaming. This is the 800 pound gorilla that has come from nowhere to become a multi billion industry in just a few short years. Traditional gaming was too obtuse and too demanding of the player. The industry was committing self harm in a big way with its dependence on the niche that is hard core gaming. Now we have escaped from that and are reaping the rewards.
• New business models. The industry was stuck for years in depending on high street sales of cardboard and plastic. But gradually subscriptions and then in-game advertising came along. Then premier membership levels on free games and micro payments for in-game items. So now there are lots of ways to make money. And that money gets invested back into the industry. So great has been this impact in such a short time that the once near monopolistic cardboard and plastic business model is in danger of dieing out.
• The interweb and more specifically broadband. Virtually every gaming platform is now connected. This is a huge change, not only in product delivery but, more importantly, in allowing a step change in the level of interaction. And as this is interactive entertainment, this step change has shaken the industry to its roots. At the same time it has magnified the immense advantages we have over older, non interactive, entertainment media. The interweb is also democratising publishing which encourages niche products, which further expands the market.
• Globalisation and consolidation. This is a good thing. It has brought massive outside investment into the industry. It has allowed managers to paint with a broad brush and to take risks. It has attracted the best brains and the best talent. Not only to development, but more importantly, increasingly to management.
• Platform proliferation. I remember, quite recently, when there were just two viable platforms to publish on, PC and Playstation One. Now we have the big three home consoles and in addition their online portals. There are two massively successful dedicated handheld consoles. There is traditional phone gaming, iPod/iPhone, Zune and nGage. The PC has proliferated into a multi faceted platform that is different things to different people. And there are many more. Dedicated handheld games, aircraft seat back gaming and so on. There is even video gaming on SCUBA diving wrist computers! And this proliferation will only increase as the industry becomes massive and as interactive entertainment enters new niches.

The thing about each of these elements (and there are more) is that they don’t work in isolation. They work synergistically together which magnifies and leverages the effect that each of them has. So we are in a virtuous upward spiral of serendipity. Where at long last interactive entertainment is coming out of the shadows and is beginning to give us a glimpse of its true potential. Things may be starting to look big now, but you ain’t seen nothing yet. We are still at the beginning of what we are going to achieve.

It would be unfair (so as to have some balance) not to mention the three biggest problems in the industry:

• Gaming is still badly misunderstood and mistrusted by the majority of the world’s broadcast media. Entrenched ignorant dinosaurs in positions of power make this so. This is slowly changing as the gaming literate generation rises through the ranks. But it is a slow process. The same also applies to the world’s politicians.
• Game industry management is very often poor. This is a legacy from when the industry was very small and there were low barriers of entry for managers. So people’s careers have just grown with the industry without them needing to compete in the area of management skills. I have been derided by senior people in the industry for having some professional management training, this gives you an idea how pathetic and insecure some of these people are. This situation is changing, but it will take time.
• Piracy. We are engaged in an ongoing technical war against the vast majority of people who would rather not pay for their games. Game consoles, effectively, are DRM machines that serve as anti piracy dongles. Once protection is bypassed the business model is broken. This has happened many times in this industry and is happening right now with PSP and retail PC games.

On balance we are still well ahead despite these problems. The fundamental advantages of interactivity, connectivity and non linearity are so great that they overcome all obstacles.

It is very interesting that the marketing bosses of two different game publishers are using girls as marketing tools for upcoming games. The girls they have chosen, the marketing approaches and the press reactions make very interesting comparisons.

EIDOS/Sci  chose 23 year old Alison Carroll from Croydon to be the new “face” of Lara Croft to promote the latest upcoming version of Tomb Raiders. They make much of her attributes: “Sarah Hoeksma, Eidos Group Marketing Director says;“With her tremendous athletic ability, dance training and striking look we feel Alison embodies all the assets required to be the live model of Lara Croft, and we are really looking forward to working with her.” ” But this has absolutely zero to do with the game. And what is Alison actually going to do?: “Alison will be lining up a host of international modelling assignments, starring in TV commercials, appearing on chat shows and is set to travel the globe over the coming months.” So her body is the asset that Eidos marketing are using.

Alison was introduced to the press doing cartwheels wearing the iconic uniform. She said she had seen a sneak preview of the game and that it was “magical”. Then Alison was rolled out for prime time coverage in the main television channels who lapped it up hook line and sinker. At no stage has the issue of this being exploitative become an issue. Nobody is accusing Eidos of cynical marketing.

Then there is adult actress Tera Patrick who has been made a “special producer” on the THQ game Saint’s Row 2. She is is a bright, well educated lady who owns her own film production company, has a lot of experience directing and producing films and has been involved in two game development projects already, this is her third. She is a keen gamer, with a good knowledge of gaming and has a very high media profile globally. The core demographic of her fanbase is a close fit to the core demographic for the game and there are many opportunities for cross promotions between the two brands. She has been masthead publisher of Genesis magazine since 2003 so has a lot of experience of brand co-operation. She has considerable potential to add value to both the game development and the game publishing side of the project.

Yet, strangely, Tera’s appointment has been met with comment that it is exploitative and cynical when it seems to me that she has vastly more to contribute to a game than a golf club receptionist from Croydon. Certainly her first video was very good at getting the game features accross.

So I think that both marketing departments have done well here. They have succeeded in getting disproportionate global media coverage and their games will sell far better as a result. THQ are trying to build a little known brand up and are competing against the giant that is Grand Theft Auto. So they can afford to be more edgy, in fact it works strongly in their favour in building the brand image. Eidos, on the other hand, have an extremely well established brand, so need to play safe and conform to the existing brand identity. So they make a story about their girl doing cartwheels and going for SAS, firearms and archaeological training. Just enough bait to hook the press when combined with a camera friendly face and body.

In both cases the marketing use of the girls is very sophisticated and shows just how grown up and mainstream our industry is becoming. Which is the opposite of what some commentators say.

High street game retail has never had it so good as it is now, with three console manufacturers all succeeding and an ever widening demographic. But this next year or do are the peak of a wave and it will be rapidly downhill from then. Already high street retail sells a far smaller fraction of gaming than online provides.

Firstly far more games are stolen on peer to peer networks than are bought. So people are perfectly happy to accept delivery of games in this way. Admittedly without paying for them.

Then there is the legitimate online gaming. Habbo, Maple Story, Runescape, World of Warcraft etc with tens of millions of players. Downloadable games from all three platform holders, which is exceeding their wildest expectations. Steam and the other online content providers looking after the PC market. And the 800 pound gorilla that is casual gaming.

The main function of consoles is to act as an anti piracy dongle. And whilst this isn’t broken high street still has a role for this generation. However the world is very rapidly converting to 100Mbps broadband, which makes a console as a media hub based on the internet a practical reality. One which Sony and Microsoft are both working towards with ever bigger hard drives.

An alternative future is to have server based gaming with a fairly thin client in the home, perhaps built into the TV. This approach has the benefits of far lower hardware costs and zero piracy. Microsoft have invested heavily with a Chinese TV manufacturer, probably for this reason and Sony are already a major TV manufacturer.

Then there is the view of Alex St. John of WildTangent who thinks that consoles will die out to be replaced by PC gaming. I am inclined to disagree with this for a number of reasons: cost, lack of standardisation, piracy, lack of platform holder to market it, horrible architecture, poor entertainment hub capabilities etc etc

Download offers a lot of advantages over retail. A far wider range of product would be on offer with no stock problems, delivery is far more convenient with the game loaded direct on your game machine, there is no plastic and cardboard to clutter up your house, cutting out the costs of distribution and retail mean games can be cheaper to buy and publishers and developers have a better business model with a long tail so are far more likely to create niche games.

So the future will definitely be online and could be powerful entertainment hubs or server based gaming. Or both. Or maybe PCs. What is for sure is that none of these options need a high street.

In the early 1980s at Imagine Software in Liverpool I was trying to give customers the most possible added value in the packaging content. The idea was to add more and more folds to the cassette inlay card, each with additional information. So I wrote a company profile for one fold and a profile of the game’s author on another and so on. Eventually, as more people became involved on each game, it became possible to concoct a list of credits to put on yet another fold. This may (or may not) be the first time this was done with a video game.

I liked credits because they gave the picture of a team behind the game, thus adding to its perceived value. Artists and musicians were obvious additions but I even put the tea trolley girl on the list, which pleased her greatly. This is nothing more or less than the film industry has done for years. They really do go to great lengths for the maximum credit list, no matter how insignificant a person’s contribution.

Games now have production teams that can be bigger than those for a film. So the credits have grown. However the implementation of these credits within our industry is still shoddy, inconsistent, unprofessional and badly thought through. Both from a marketing point of view and from the view of looking after your staff properly. The credits policy varies wildly throughout the industry, from zero recognition of any one’s input to a massive list of everyone possible, and all possible permutations in between.

One unfortunate practice is to only include members of the team still employed by the developer at the end of the project. And to leave out anyone who has left the team to work elsewhere. This is especially harsh on an MMORPG which can take a few years to produce. Here someone can put two or three years of their life into a project and still not get a credit. This has reared its ugly head once more with Mythic and their game Warhammer. The International Game Developers Association (IGDA) are not happy and their chairperson Jen MacLean said: “This policy is disrespectful of the effort of the game developers who worked on the game, and misleads both consumers and game industry peers.”

Equally misleading is the habit some companies have of giving production credits to senior management, even if they had nothing to do with the game. One of the worst for this was Bruno Bonnell, when he was in charge every Infogrames game was “A Bruno Bonnell Production”, even if it was created by a company that he had recently bought, so he could not have had any input whatsoever.

It is obvious that what is needed here is standard industry practice. A set of guidelines for credits for all publishers to adhere to that gives game purchasers the true story and which rightly looks after the people whose creative input makes the whole industry possible. Surely as an industry we should be mature enough to get this right.

Despite supposedly employing the brightest people on earth and having the riches of Croesus, Google continually fail to extend its business model successfully beyond search advertising. This must be infuriating when it sees tech rival Microsoft being so successful in so many areas.

Google’s latest attempt to break out is the virtual world, Lively, which was launched in July. Browser based, it is really just a  Second Life lite. And, apeing Second Life, there is nothing to do, so like Second Life it is deserted. It is a pity because Google have the in house expertise and technology to do this right and make a serious impact on the virtual world market. Instead it has concentrated on the social networking aspect, an area that is more than well served by entrenched competition. This at the detriment of the gaming side. Just like Second Life. Perhaps if it had been looking at Maple Story, Runescape, Habbo, Club Penguin, Guild Wars etc it would have had a better idea what people want.

Maybe Google could learn in this area from Rupert Murdoch, who has no campus full of geeks. With a low cost, low risk strategy he is leveraging his existing brand and customer base with a product that people actually want, TheLondonPaper casual gaming portal. This can be used as a template and reskinned as a bolt on cash cow for any of his myriad global empire of media. You can see that he is a businessman.

We have another Second Life alike about to burst onto the scene with Sony Home. This time it has a huge potential to integrate gaming with social networking well. If it succeeds this could be a seminal product that changes the gaming landscape. We will see. Certainly it will be an extreme disappointment if this turns out to be another Lively.

Back to Google and another recent launch of its, Knol. This user friendly knowledge repository is a competitor for Wikipedia, and Google are relying upon user generated content to get it up to critical mass This has the potential to be another Lively, but it could be what finally gives Google a toehole in a business outside search.