An interesting industry picture
At present, Newell explained, games [AAA ones, anyway! – Raph] require an investment of between USD 10 million and USD 30 million before development can even begin. “There’s a huge amount of risk associated with those dollars and decisions have to be incredibly conservative,” he said.
Meanwhile on the other side of town…
yep, there are 300 games a day coming on the iphone.
and
In the six months since King.com (www.king.com), the world’s leading online skill games company, started scouring the world for developers who can create high-quality games that could be promoted via their distribution network, over 40 games have been created and released, which have been played over 100 million times on 7,000 websites.
Oh, but where’s the money? Well…
If granted, the “Advertised Revenue Sharing” patent will let Microsoft populate virtual worlds with advertiser-generated avatars. These virtual creatures, true predecessors of Agent Smith, will be used to provide advertising in virtual worlds. Furthermore, in the application, Microsoft talks about monitoring the level of interaction between your avatar and the advertiser-generated avatar. You can guess what’s next.
Remember Bootless helping you in Banjo-Kazooie? Well, now imagine Bootless won’t let you progress in the game until you hear about a new cell phone or weigh-loss product.
– TeamXBox.com, “Microsoft Working on ‘Advertiser-Generated Avatars'”
or Viximo’s latest post, or these notes from Casual Connect on how developers are doing it, or…
Such interesting times. 🙂
12 Responses to “An interesting industry picture”
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The last quote is an example of one of the few cases in which I think current industry trends will actually hurt the genre of online games and virtual worlds. “View this Viagra Ad to progress!” would be a barrier to entry. Remove enough monetary and technological barriers to entry and start putting in too many immersion breaking mechanics like that – the game will go from enjoyable to annoying.
In a relatively similar example, interstitial ads. I will not browse websites that do 3rd party interstitial ads. I won’t download from sites that do the same thing. It pisses me off. If a movie I want to watch online has a commercial before it, I turn it off. I don’t watch commercials on TV either, everything is DVRed or I turn the channel during commercials.
Maybe I’m in the minority. But at some point, gamers would rather pay for a AAA MMO than deal with constant in-your-face ads. Where that point is, I’m not sure. Evidently we’re not there yet.
Cuppycake wrote:
But at some point, gamers would rather pay for a AAA MMO than deal with constant in-your-face ads.
Well….
1. Having ads and being AAA are not really related. Lost is certainly a AAA tv show and they drag you out of the show every few minutes to watch a couple minutes of ads. Yes, you can skip them if you DVR them like you do (and like I do) but shows like Lost and American Idol are still money machines because a huge portion of people do not do that. They’d rather consume content on the ‘free’ networks than pay an extra fee for the HBOs or Showtimes (which tend to have higher quality content, in my subjective opinion).
2. I think it’s a mistake to believe that most people want the kind of immersion core gamers want. Zynga, Playdom, and Playfish are demonstrating the point here pretty strongly.
–matt
zo – that’s how you start a shift I.
Well, you know, I think they (you) don’t pay enough attention to the filtered results of what’s more fun than actual playing but the blogs of IMPLICIT REWARDS, that is, the filtering of the research of the researches TN. Teh one thing I thought was important, anyway.
Standing outside of something called Acadechism. I just love that, making this postm, can’t get a group for that. Ots is another shift thing but I think it is profound. See… LFG says only one found. And, as I condemn this, they respond with evidence to the contrary, which I love too, because it comes out as have you ever been to the achenmisch? which of course the response is “That I have” “but not in some while I haven’t”…
I guess I should just buy the automated char transfer to Antonia Bayle server now, eh?
Oh and while I’m shouting out I need some movement based games (see “IMPLICIT REWARDS”) I don’t give a about your latency issues. Or sell me the classics before all that “changes”.
Ah but then there is “just feel like doing something and don’t mind helping others when asked”….. which throws it all off, eh?
> Remember Bootless helping you in Banjo-Kazooie?
I don’t.
There was a character named Bottles, though.
And being forced to watch unwanted cut-scenes before being able to get on with the actual playing is already a problem.
If you’re looking for a great way to have player-funded games, check out Greg Stolze’s Ransom model.
Don’t know how is in the U.S. but in the U.K. commercial t.v. channels are in deep, deep trouble because advertising revenue is sliding out of sight. And that started long before the recession. The talk here is about whether commercial television will even survive without finding a non-advertising based funding model.
The response so far has largely been to go further and further downmarket in search of consumers who don’t have sufficient other options to avoid the advertising, but that creates a demographic that isn’t attractive to many advertisers. It’s a vicious circle of decline.
In gaming terms, I would imagine we’ll get the same as other entertainment genres: high quality, commercial-free product for those willing to pay a premium, low-quality advertising-driven product for the rest. Whether, in gaming terms, “the rest” is enough to make advertisers buy-in remains to be seen.
I think the diversity of game platforms, ways to distribute and also to subvert the traditional AAA model is intriguing. As Develop in Brighton is was clear that the changes in how we interact and work across the web, social media and virtual worlds has bypassed a few people solely focussed on AAA.
It was pretty much the same as any industry in that there were pockets of great innovation and drive but also a lot of “this is the way we have always done it”. Something I probably should not have been surprised at as its the same in every large enterprise.
Many of the old school developers Like Dave Jones pointed out how exciting it was to see the social gaming, iphone, home coding suddenly reappear again as he pointed out “I started that way but thought those days had gone”.
A thought along a different line, what happens when the “long trail” (I think it’s called) becomes too long, and the leader is in decline? It seems to me that the gaming industry is approaching that, but that’s guess work on my part from a very narrow range of observation.
Sorry that was a bit obtuse, eh? What I mean is, it is apparently very easy to spend that $100 million and come up with something that isn’t fun. Seems like implicit fun should be where the serious development begins, not $10 or $100 million. It shouldn’t cost any more than a few hundred hours to determine if something is fun, I would think, regardless of the dressing. Obviously Gabe (or someone thereby) knew this bit at one point.
Speaking as a player, I think a eulogy for the AAA titles is premature. KOTOR, DC Universe and Star Trek, if they launch solid and smooth, have the potential to kick over the applecart. We all know that a blockbuster IP doesn’t make for a blockbuster game, of course. But a blockbuster IP behind a solid design that’s been polished and repolished to a flawless gloss before launch would be another matter (as opposed to one that’s shoved out the door raw and unfinished over the objections of the beta testers and devs).
I think DC Universe is especially underestimated. The property itself has waxed and waned in popularity, but it’s chugged along for more than 70 years now. DC creations have woven themselves into the culture, even into the language, to an extent that no other MMO property has.
I wouldn’t bet on it beating WoW, but given a solid launch and plenty of crunchy content, I believe it’s at least playing in the same division.
@Yukon Sam, The problem I see with all blockbuster IPs is that they inevitably force the design team to develop the same MMO we’ve seen since EQ. In an MMO if you give the players the ability to do anything they will usually do something that you did not expect. (See TSO and the Intel/McDonalds sit ins) Every designer has a story about this.
So, once you accept an IP, you’re forced to design to protect that IP from the players which leads to theme park games. I’m of the mind that the exisiting 16 million+ MMO players have grokked the theme park MMO pattern and are looking for something more in the genre. That certainly explains the shrinking market growth, the increased churn rates and a host of other declining indicators in the industry.
Unfortunately, those same feedback patterns from the players are killing the investment arena as MMO games go out of favor with investors. That’s why self funding works (Copernicus @ 38 Studios) and why people are even looking to crowdfunded games. For a MMO, IMHO, crowdfunding is a huge longshot. I’ve looked into it and the risks to the developer are large.
The tail is a set of associations. It is the transaction flow through it that accounts for sustainability. If the leader is declining and hasn’t changed position, the tail is evaporating. IOW, the market itself is evaporating. Think about sheet music transactions in the days when every house had a piano and players, mechanical or human, abounded. Think about it now. Does your family play the game of standing around a piano singing?
Whereas sheet music once ‘supported’ that ‘game’, it does at much lower frequency and distribution now. Wii on the other hand, is happening. One game replaced another. One set of hardware replaced another. Everyone is a player but few know or need to know how to tune ‘the piano’.
The long tail itself is a myth, a temporary hope that distribution would make the edges important and for a short time, they are. Then the market reaggregates, reconcentrates and the IBM of one era is replaced by the Microsoft, and Compuserve is replaced by Google. There is no change in kind, just fashions churning around local scarcities trending out to become fashion necessisities.
Same world. Different games. Same goals. Different moves.
Len, I don’t think that’s right, but I’m no expert. I thought the tail was all the other product on the graph chart. And just because the leader is declining doesn’t necessarily mean the tail is evaporating, although it could be. Equally possible is that the tail is extending, usually with cheaper product. What I think happens in this case is that the leader has failed to be good enough to maintain leadership, so it’s basically falling closer in line with the others. The point is that at some point, the tail has extended so far that profits are not enough for anyone to maintain the product, causing them all to cheapen their product even more to keep going. It’s a case of over saturated market. But also, these situations tend to level the field by the nature of some closing their doors, allowing the others enough extra business to keep afloat.
In MMOs though, there’s a wild card coming into the picture. Product that’s not there to make a profit for themselves, but for another (other) product(s).
Of course, the way to avoid that scenario is for new products that storm the industry with different somethings or a fresh look. Something that the cheaper products can’t really compete with, at least yet.