Eight news stories 5.3


  • “New research conducted by games development industry body TIGA shows that the UK games development sector is a highly skilled and successful industry that exports games all over the world. However, the UK games industry is being held back by the Government’s tax regime, skill shortages, and a lack of finance.” A direct quote from this TIGA press release. And something every regular reader here already knows. The British game industry once pulled well above its weight but indifference, neglect, apathy, ignorance and ineptitude from this abysmal labour government have sold the industry down the river. Yet interactive media is the future and Korea, Canada, France, China, Malaysia etc have governments that realise this and who give massive support.
  • ITV (Uk commercial television broadcaster) loses £2.7 billion, 600 jobs to go. Inevitable. And this is just the beginning of the slide of television as we know it into oblivion. Their business model is broken because their old fashioned media cannot compete. They lack interactivity, connectivity and non linearity. Newspapers are in similar dire trouble. The BBC is impervious to reality with its massive salary culture because UK television owners have no option but to pay for it. Even this cannot go on for ever. Gaming will be bigger than television and film combined. People are switching their spend, both of money and time, away from the old and obsolete media to something that is technically vastly superior. And it could be so different, the TV companies have mountains of amazing IP that could make the transition across from old to new entertainment media, but their management are entrenched with their heads in the sand. Once again this has all been said on here before.
  • Toys R Us move towards the pre owned game market. So retail makes profit several times out of a single game whilst the developers only get paid once, despite several owners enjoying the fruits of their labour. You can see where this is going, the boxed game market is already a marginal business model. And the alternative of delivering content online works so much better in so many ways. All the retailers are achieving by going to pre owned is to speed up the demise of boxed games as a viable business. They are shooting themselves in the feet. Publishers are already moving from plastic and cardboard distribution to online at some speed. Now they will make the move even faster.
  • Blu Ray is turning out to be yet another failed Sony media standard. It offers too little in the way of features and benefits over DVD and is rapidly being overtaken by online delivery of content. This has cost Sony billions, is one of the main factors in the failure of the PS3 and is only the latest in a long string of Sony media standard failures, going all the way back to Betamax.
  • There have now been over a billion online matches of Halo 3 on Xbox Live. Another fact for anyone in this industry to write on their shaving/makeup/both mirror. If you had predicted this to anyone in the industry just two years ago they would have laughed at you. We have witnessed massive change in a very short time. And still there are plenty who don’t get it.
  • Howard Stringer rearranges the deckchairs on the Titanic rejigs Sony senior management. Something needs to be done. He says: “Consumers want products that are networked, multi-functional and service-enhanced utilizing open technologies, and user experiences that are rich, shared and, increasingly, green.”  Something Sony have singularly failed to deliver. Their obsession with media standards has brought them multiple product defeats. The PS3 is a disaster zone. And different divisions, like movie making, televisions and mobile phones don’t talk to each other. So what should and could be competitive advantages are totally ignored. Why have Apple succeeded with the iPhone when Sony was far better positioned in every way to deliver such a device? Why are blockbuster movies produced by Sony studios without integrating the IP into Sony gaming and hardware products as a matter of course? Why are Sony not pushing towards thin client televisions with cloud delivery of a huge range of content?
  • THQ has 50/50 chance of going bankrupt according to this analyst/report. They are being hit by multiple whammies. They are the wrong size, publishers need to be massive and global to get the economies of scale necessary to be competitive, or small and agile if they wish to exploit niches. The boxed console game market has become a very difficult business model for just about every publisher, it is not a good place to be. And finally product quality is on the up, publishers are realising that they are wasting their time selling bad games and so public expectations of product quality are much higher.
  • Microsoft Xbox 360 tops Japanese console sales (again). This time it is Star Ocean 4: The Last Hope that is doing the business for them. It is quite simple really, just give the public what the public want. Microsoft are succeeding to an extent in Japan that nobody could have predicted and as a result are building a very respectable customer base. If they continue this stream of must have titles they will become a genuine force in the Japanese market.


  1. THQ seem to be pushing towards digital distribution too. They got into bed with Steam for Dawn of War II, making GameStop have a fit like a toddler having his sweets taken away.

    The only thing that worries me is the idea that publishers are focusing on less releases, but bigger and better games…as THQ have stated today. On one side, you can see why to maximise profit …but it sounds a bit like “making bigger eggs and keeping them in less baskets”.

  2. More inconsistency to allow you to crowbar stories into your (single-format pipedream) worldview.

    It took over five years for DVD to unseat VHS, and it eventually happened not because the players or the films were cheaper, but because retailers pushed VHS out of the market. The same thing has happened with CRT televisions, and the same thing will eventually happen with DVDs.

    If retailers are having to resort to preowned games to shore up their profits, why are they going to do anything to keep virtually marginless DVDs around? Increasingly extravagant box-sets have given DVDs a seasonal stay of execution, but the piles of heavily discounted stock that clutter the shelves come January suggest that even this strategy has been milked to death.

    You (or rather the source article you’re taking at face value) also neglect to mention that movie downloads are typically rentals, not purchases. The studios have no interest in killing the golden goose of premium disc-based distribution either.

    Elsewhere we’ve got the usual premature writing-off of the PS3, made the more ridiculous when a PS3 exclusive (Killzone 2) is at the top of the UK all-formats chart (and another – Yakuza 3 – tops the Japanese chart), and a recent major multiplatform release (Street Fighter IV) has seen the majority of sales on the platform.

    Somehow Sony have sold 2m PS3s in the UK and 20m worldwide (while the machine has been uncompetitively priced); every multiplatform title of any note now ships simultaneously on the PS3 and 360. All the publishers seem to have figured out that the machine is here to stay, what do you know that they don’t?

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