Games and Recession ... and Creativity
On the face of it, you wouldn't expect the next couple of years to be
very good for innovation and creativity in videogames. Admittedly,
widespread fears over the effects of recession are somewhat overblown -
right now, there's simply no evidence that economic woes are impacting
on videogame sales and 2009 still looks set to be a growth year for the
market.
However, the recession - and perhaps more importantly, the slow-down
of commercial lending from banks - creates a certain mindset among
businesspeople, even those whose sectors are still in rude health. EA's
John Riccitiello summed up the mood at the DICE Summit earlier this
month, where he told the audience that EA - which has recently cut
1,100 jobs in its worldwide operations - had become "too fat, too
reliant on where things were."
Of course, that would have been true even if the recession had never
happened - in fact, people including some of EA's own executives have
been suggesting that the company is bloated and inefficient for years,
a fact underlined by years of rising costs and relatively stagnant
revenues.
As Riccitiello admitted, however, to firms in this position (and it's
certainly not just EA that finds itself staring at the consequences of
uncontrolled cost rises), the recession has been a "blessing in
disguise". Suddenly, macro-economic conditions allow them to slash
their costs without anyone batting an eyelid, while the same moves
twelve months ago would have caused serious concerns about the
company's status.
So even for those companies whose products will continue to see sales
growth for the next couple of years, the atmosphere is one of
frugality. Drought in the credit markets doesn't help, naturally, but
for the most part this sense of belt-tightening is more to do with
companies taking the opportunity to scale back costs than it is to do
with any real financial necessity.
Sadly, when companies scale back costs, they often do so at the
expense of throwing out a whole creche full of babies along with the
bathwater. If you look at the operations of a big first-party studio,
for instance, much of the wasted resource comes from big-name titles,
especially those on 12 or 18 month franchise schedules. Money and
man-hours are thrown away on bloated, mismanaged teams, the legacy of
years of ill-advised "throw more people at the problem" solutions to
problematic deadlines.
However, trimming the fat from those teams is hard work. Everyone on
the team will fight their corner, claiming their intrinsic worth to the
profitable project. Each middle-manager will act like a minor feudal
lord, jealously guarding his painstakingly accumulated collection of
vassals and subjects. Team sizes, all too often, end up being more to
do with office politics and power-grabs than to do with the actual
requirements of making a game, and extricating a small, lean, efficient
team from this quagmire requires a huge amount of work and some very
tough decisions.
Meanwhile, most studios also boast a handful of nascent projects -
ideas which are floating around in the pre-production stages,
championed by a handful of developers and designers who are working on
the concept. On a slightly larger scale are the original game projects,
games in production but lacking a big franchise or IP license behind
them.
These projects are risky. They're not guaranteed any level of
commercial success, and while critics all profess to love original IP,
that doesn't mean that original projects are guaranteed a high
Metacritic rating either. Compared with the risks associated with
trying to trim back costs on high-profile franchise projects, the
decision to instead cut back on new ideas and teams working on unproven
IP will look extremely tempting to many studios. The same logic, too,
will apply at the publishing level, with risky ideas likely to find far
less warm receptions at publishers in the coming years.
Both from a creative perspective and from a more long-term business
perspective, this is bad news. Creativity has always demanded some risk
taking behaviour from publishers - more specifically, a willingness to
balance out the risk of some original projects against the guaranteed
returns of some blockbuster franchises. The industry's business model,
meanwhile, demands that creativity to survive. Without the risk-taking
that allows original IP to emerge, the games industry would soon find
itself feeding off scraps from the table of the movie, TV and sports
licensing industries.
However, not all publishers are quite as willing to clamp down on risk
as they used to be. EA is a perfect example; since Riccitiello returned
to the company, the firm has been making increasingly encouraging
noises and now seems to understand that risk is an essential part of
the business of making entertainment, rather than being an unfortunate
side-effect which must be controlled and reduced. Some other publishers
are slowly but surely getting the message; the platform holders, too,
are learning. Whatever else it may have done wrong of late, Sony
deserves special praise for its recent willingness to try out new ideas
and champion creativity through its first-party releases.
Even these bright spots in the gloom, however, don't change the fact
that many publishers are going to become more risk-averse and less
friendly to innovative ideas in the coming years. However, there's a
further variable to be reckoned with in this equation - the slow but
increasingly assured rise of independent games as a commercial force in
the market.
We've all been talking about independent games for years, of course.
Created outside the studio system by passionate, talented enthusiasts,
independent games have been celebrated by the media and even recognised
by the industry (thanks to the fantastic Independent Games Festival
which runs alongside GDC each year). Rarely, however, have they made
any significant impact on the commerce of the industry.
This is changing. It is changing because millions of new consumers who
have never played games before are now active in the market, and
looking for new experiences which traditional firms simply don't know
how to provide. It is changing because the tools which allow the
creation of superb games are no longer out of the reach of small teams
and even individuals. It is changing because word of mouth has become
more powerful than any marketing campaign could ever be. More than
anything, it is changing because every major console on the planet now
has a digital distribution system allowing consumers to download games
at a wide range of price points.
No longer are independent games confined to the PC platform. No longer
do they have to be given away for free, as they have been in many
cases. No longer are they kept away from the marketplace simply by the
high walls which surround retail, isolated from consumers by an
industry which has traditionally only understood the concept of selling
monolithic units of entertainment at a fixed £30 price point.
The explosion of creativity which will be created by this change is
only beginning. Certainly, barriers to entry still exist, but they are
slowly coming down - and I anticipate that it won't be long before
services like PlayStation Store and Xbox Live Arcade start to offer
developers the same level of easy access to market that something like
Apple's iPhone App Store does.
This revolution will give us a new wave of developers who see games
through very different eyes to those of their studio-bound compatriots.
Forced to consider the financial bottom line, the technological
bleeding edge and the whims of Metacritic at each turn, big studio
development is by no means uncreative, but certainly has to follow
certain set patterns. With few such concerns, independent game
developers can follow their hearts and their instincts to a far greater
extent.
The studio system couldn't have created a game like Flower, the
utterly beautiful PSN title which came out earlier this month; but more
than that, it couldn't have created a persona like Jenova Chen, the
mind behind Flower, who happily talks in interviews about evoking
emotions, moving past primal feelings and "maturing" the industry in
ways that don't involve sex, blood and swearing. He talks about making
games that don't empower gamers, but instead make them experience other
things, other emotions. It's spine-tingling stuff. It's also commercial
suicide - or would be, to a studio working in the traditional
development context.
Others like him are emerging, or have emerged, from this scene. Let's
not beat around the bush - many of them will build games which will be
terrible. Many will try so hard to depart from the way games are
traditionally made that they'll fail to notice that some of those
things stem from hard-learned lessons, not constrictive rules. Others
will make games which are fascinating, or extraordinary, or immensely
entertaining, but which simply fail to find a market.
But from among them, there will come a select few who will make games
that tick all of the boxes. They will be new, and fresh, and daring -
and hugely, vastly commercially successful. Developed for a handful of
notes, they will make millions, and they will fuel the careers of new
auteurs and the passion of new generations of creators.
The studio blockbuster system won't go away any time soon - and nobody
should want it to, any more than any serious movie fan should genuinely
wish for the demise of Hollywood. However, the studio system is no
longer alone, and its role in creating commercial success will soon no
longer be a monopoly. Creativity will face tough times in recession -
but no financial downturn will stop it from blooming, even if it's not
in the places we might expect.
(www.gamesindustry.biz)
The decline of traditional retail is a topic which has been discussed,
on and off, for around a decade now. It's a conversation which is
particularly relevant to videogames and other digital media, where
direct online distribution is possible, but online shopping has
affected almost every retail sector - even clothes and food, the
backbone of the high street.
In spite of this lengthy discussion, it's still something of a shock
to see two large retail chains, both of them very active in the
videogames sector, shutting down in the space of a couple of months.
Woolworths has been a fixture of towns around the UK for a century, and
in recent years has been a key outlet for videogames, especially at the
casual and family-oriented end of the market. Zavvi, the new name of
the Virgin Megastores chain, occupies some of the best retail property
in the UK and was determined to focus the core of its business around
videogames.
Now they're both gone, or are on the way out. With no buyers in sight
for either chain, both have suffered the fate of stock liquidations,
massive job losses and the sale of their individual retail locations.
After years of discussion and dire predictions regarding the future of
high street retail, should these closures be seen as support for those
arguments? Is this, as much of the commentary has indicated, a clear
sign that the high street is entering its latter days?
Too much weight can be placed on those conclusions, and it's important
to consider that there are special circumstances surrounding the
collapse of both Woolworths and Zavvi. In the case of Woolworths, the
company has been facing trouble for many years, and found little
succour in the buoyant economic conditions of the past decade.
Ironically, its low-cost, "cheap and cheerful" approach (many would
debate the use of the word "cheerful", in fact) might have resonated
better with consumers in a recession. It'll never have a chance to find
out, however.
Zavvi, meanwhile, has slid out of view protesting all the while that
it's a victim of circumstance. Its sales through 2008, the company
says, were healthy - but when Woolworths went down, it also spelled the
end for Entertainment UK, a distribution outfit which supplied Zavvi
with much of its stock. With tens of millions of pounds of debt
suddenly being called in and deep concerns over how to keep key items
(especially games) in stock over Christmas, Zavvi promptly ended up
being dragged down by the Woolworths disaster.
Just unlucky, then? Woolworths, caught short by the timing of the
economic cycle; Zavvi, a victim of pure circumstance, mere collateral
damage in Woolworths' implosion?
That's one interpretation, and it's one to which many in the high
street retail business have flocked. There's certainly an element of
truth here - but in dismissing these dramatic collapses as mere
circumstance, we risk blindly ignoring the important lessons and
indicators which they provide.
The fact is that very few corporate collapses are marked by graceful,
textbook descents as sales slide, profits fall, and the whole
operation is wound down by administrators. As managers (and eventually
administrators) attempt to rescue businesses facing difficulties, they
often take gambles which result in far more dramatic collapses.
Weakened businesses are also easy prey for hiccups in the economy of
any description, which can result in a seemingly sudden demise rather
than a slow decline.
In other words, yes - the collapses of Woolworths and Zavvi are
definitely the product of circumstance. However, there is an important
argument here which says that those circumstances could only sink these
large companies because there are bigger, underlying problems in play.
The harsh reality is that high street retailers are increasingly being
burned by trying to play in the same markets as successful online
stores. Online retail has squeezed profit margins significantly, even
to the extent that many online stores such as Amazon and Play can make
a profit at prices which would drive bricks-and-mortar stores into the
red. It's extremely telling that even in the depths of Zavvi's closing
down sale, the store had few bargains on offer which weren't already
cheaper online.
Moreover, with those profit margins so tightly reined in, bricks and
mortar enterprises find themselves more vulnerable than ever to the
kind of bumps in the road I mentioned a moment ago. They become heavily
reliant on day to day cashflow, which can be seriously impacted by
supply problems. In order to paper over those cracks, they need a
healthy credit relationship with the banks - and right now, one doesn't
utter the phrase "healthy credit relationship" within a mile of the
City of London without eliciting bitter laughter and angry stares.
It's also extremely telling that nobody actually wanted to step in and
buy Zavvi, let alone Woolworths. HMV has picked up a handful of stores
in order to extend its network around the UK, but even at that, some of
Zavvi's choicest retail locations - such as its enormous London store
on Oxford Street and the hugely prestigious Piccadilly Circus store,
formerly occupied by Tower Records - look set to leave the media retail
sector entirely. They're most likely to end up selling budget clothing
for the next few years.
If Zavvi's sales were growing and the company had a good plan going
forward, why didn't anyone buy them? In part, of course, it's down to
the fact that with the banks sitting in the corner sulking and refusing
to play, it's rather hard for the mergers and acquisitions game to
continue.
It doesn't help, however, that sentiment about the future of Zavvi's
entire market sector is almost entirely negative. It's not just that
you can buy CDs, DVDs and games more cheaply online - many in the
industry are still reeling from just how quickly digital distribution
is replacing CDs. Five years ago it was expected to take decades to
move consumers away from physical products; today, we're already past
the tipping point in some markets. Who can blame the business world for
looking nervously at the boxed movie and videogame markets and
wondering how long they'll be around for?
All of which, of course, causes us to cast a questioning eye in the
direction of the remaining retail giants of this sector - which in the
UK means Game and HMV. They're likely to enjoy something of an upwards
push from the demise of Woolworths and Zavvi, since there'll be less
high street competition - and it helps that their sector, the
relatively low-cost home entertainment market, is also likely to thrive
in an economic depression.
In the medium term, however, what future is there for these
businesses? If consumers increasingly go online - either for mail order
or digitally distributed product - what justification can there be for
the massive overheads involved in maintaining their enormous store
networks? Perhaps its telling that both firms are committing themselves
to second hand sales, much to the annoyance of the game publishing
industry - this, after all, is a USP which online simply can't
replicate.
In itself, that's a sobering vision of the future for the high street
- media stores simply filled with second hand product that was
originally bought online. Yet the bleak choices facing high street
media retailers in the next five years may be to resign themselves to
being second hand thrift stores, or to go the way of Zavvi. This
recession won't kill them - but the march of consumer buying habits and
preferences will leave them behind.
(www.gamesindustry.biz)
The Tokyo Games Show is, arguably, one of the videogame industry's
most unusual fixtures. The innate peculiarity of the Japanese market as
seen by western eyes aside, the mere timing of the event makes it
distinctly odd.
By the time TGS rolls around, in late September or early October, the
release schedule for Christmas has already been firmly locked into
place in the USA and Europe. By and large, E3 is the show where we find
out what'll appear in October and November. Europe's Game Convention is
where the schedule is tweaked and polished. TGS makes a running leap
off the end of the pier and misses the boat entirely.
There are a couple of key reasons for this. Firstly, the Japanese
market itself isn't remotely as Christmas-focused as the rest of the
world. The New Year celebrations do help to get the Yen pouring into
the tills, but the country's really big spending (on interactive
entertainment, at least) is reserved for Golden Week - a series of
national holidays at the beginning of May. As such, TGS is a good
opportunity to show the domestic market what's upcoming for that key
period.
Secondly, there's the simple fact that TGS is a consumer show. Given
the heavy focus on keynotes and new unveilings in western press
coverage of the event, it's easy to forget that the show's raison
d'etre is showing off upcoming games to consumers. Admittedly, once
you've made the error of being stuck in the immense crowds who descend
on Makuhari Messe for the consumer days of the show, this knowledge is
liable to be permanently stamped on your memory.
From a local perspective, then, TGS makes perfect sense. Looking at it
internationally, however, it's obviously tough for games companies and
media alike to know how to treat the event. Unlike other regional
shows, TGS is unquestionably a global event for the industry (look at
South Korea's intriguing but distinctly parochial G-Star show by
comparison). This is partially because Japanese games continue to hold
both fascination and commercial value for the global market, but also
because TGS has become another front in the ongoing console battle.
In recent years, the event has seen a rising tide both of western
media, and of western publishers and game titles. Microsoft's entry
into the console market - and its renewed assault on Japanese hearts,
minds and wallets with the Xbox 360 - is largely the root cause of
this. Combined with the prominence of European-developed titles in
Sony's line-up, it's led to the unusual situation where journalists
from Europe and the United States travel to Japan in order to see games
developed in their home countries, often presented by executives from
their home countries.
More often than not, these games aren't even that relevant to the
Japanese market - and are greeted distinctly coldly by the Japanese
media and consumers in attendance. Companies bringing titles to TGS
also walk a tightrope - do they show off titles due to launch after
Christmas, and risk being buried in the rush of new games in October?
Or do they show off their Christmas line-up, and risk the media
wondering why on earth they're looking at the same games they saw last
month, but eight time zones from home?
The oddly ill-defined nature of TGS is hugely relevant to how this
year's show will play out. Watched closely by "hardcore" gamers (an
unpleasant term I'm going to have to continue using until someone coins
a better one), there is one main thing they're looking for.
This week, once again, Sony is on trial. Whatever the firm's views on
TGS and its relevance to the western market may be, the company simply
can't afford a weak showing in Tokyo. TGS is home turf for Sony's
Japanese studios and partners, and it's from those studios that gamers
are expecting to see growing evidence of the PlayStation 3's relevance
as a gaming platform.
It's been becoming increasingly obvious over the past year that
whatever about Nintendo fans who feel deserted by the company's
strategy with the Wii, there is also a growing band of Sony consumers
who feel that the PS3 simply isn't the platform for them any more. In
conversations in recent months, I've heard the same sentiment expressed
over and over again - that the PS3 seems to be engaged in a "race to
the bottom" with the Xbox 360, pumping out action games and racing
games rather than building the strong, diverse catalogue which made the
PlayStation 2 appealing to such a wide audience.
Much of that diversity came from Sony's Japanese studios, strongly
augmented by contributions (especially in the social gaming space) from
Europe. Yet in this generation thus far, Sony's console has failed to
even deliver on key genres which were the PS2's core strength, like
J-RPGs - let alone creating a broad church of games that brought in
minorities and niches from all around the population, from the
colourful lunacy of Keita Takahashi's Katamari Damacy to the solemn
majesty of Fumito Ueda's Shadow of the Colossus. Individually, games
like those didn't sell many PlayStations. Taken as a whole, the vast
collection of niche interests and unusual tastes catered to by the PS2
secured its place as the most popular console in the history of the
business.
Nobody expects Sony to break out a whole range of software this week
and finally reclaim that strange, diverse market it has tapped for the
past decade - served by a myriad of titles, none of them blockbuster
hits but every one of them dearly loved by its own faithful. What's
being sought, however, is an inkling that they might be on the way;
that the PS3, like the PS2 and the PlayStation before it, might be the
right place to look for creativity and entertainment that's a bit off
the beaten track.
LittleBigPlanet is an excellent start, sterling proof that Sony
understands a world beyond guns and tyres. If TGS can deliver even a
handful of games that have the potential to captivate even a handful of
players apiece, stuffed somewhere into the cracks between the
inevitable soi-disant AAA titles, it will offer a solid ray of hope for
the PS3 to continue building a strong market in 2009.
Microsoft, meanwhile, is also on trial - but this is a far less
crucial trial. In fact, it's really just curiosity on the part of the
media and gamers alike. After weeks of resurgent Xbox 360 sales in
Japan, people want to know if Microsoft really can succeed in a country
which has traditionally been utterly nonplussed about the Xbox and its
successor.
Despite some deeply uninformed conventional wisdom that's passed
around the industry in recent years, Japan isn't inherently resistant
to American- or European-developed electronics or entertainment
products. Just ask Apple, whose iPods have done great business in Japan
just as they have everywhere else, and whose iPhone is making an
unexpectedly significant dent in the "closed shop" of the Japanese
mobile phone business.
The problem with the Xbox and the 360 was that they just didn't appeal
to Japanese consumers. The industrial design seemed ugly (a problem for
Europeans too, it should be noted), the game line-up was heavily
tailored for American tastes, and previous forays into Japanese
developer relationships were fleeting enough to leave consumers worried
that they could buy an Xbox for one or two games, and then watch it
gather dust.
Now, however, there's evidence that a corner could have been turned -
a vital tipping point where consumers see enough software and enough
evidence of future software development to be willing to invest in the
console hardware. Barriers remain, of course. The Xbox 360 is still
(arguably) ugly and (provably) noisy as hell, factors which don't go
down terribly well with those who live in homes with small living
spaces - a problem, it's worth pointing out again, which applies in
Europe too.
That won't be solved at TGS - but what we will get to see is whether
Japanese consumers are really taking an interest in what Microsoft is
doing. The calibre of locally developed software on display, and the
size of the queues for the Xbox 360 displays on the show floor, will
give industry analysts plenty to think about. As Sony struggles to
convince the broad market it won with PS2 that PS3 is really the right
upgrade for them, Microsoft could finally be about to become Big In
Japan - and for once, that won't involve a photoshop of a giant Xbox
looming over Mount Fuji.
(gamesindustry.biz)
Secondhand games annoy publishers
During an otherwise excellent and optimistic talk at the Develop
conference in Brighton yesterday, industry stalwart David Braben
embarked on a brief but heated tangent from his speech topic to attack
videogames retailers - specifically, those videogames retailers who
engage in the second-hand goods market.
This is, of course, a bone of long-standing contention between
retailers and the rest of the industry. Braben added fuel to the fire
by presenting photographs of retailers whose shop windows, he pointed
out, consisted entirely of second-hand goods ("the only new thing is
the A4 piece of paper advertising Wii Fit") and making the anecdotal
claim that some games pass through the used re-sale process ten times
or more.
I can't dispute the scale of the second-hand (or even tenth-hand)
market since, like Braben, I don't actually have any figures on the
size or prevalence of this market. One area where I agree with him is
that more research into the scale of the market (and, crucially, into
the price points at which it operates) would be extremely helpful.
So for now, let's accept his assertion that second-hand sales
represent a large enough percentage of overall sales to seriously sting
the industry. That's probably true, although for a proper business case
to be made, real figures are needed.
The industry is, of course, within its rights if it wants to weigh
down more heavily on the retailers who engage in this trade. Many of
them are retailers with whom the industry does business - supplying new
hardware and software, paying for point-of-sale promotions, and so on.
That puts the industry in a position of some power, assuming, of
course, that it's willing to risk cutting off its own nose to spite its
face by further reducing the appeal of new software at these outlets.
Where the industry's rights - and more importantly, the sanity of its
actions - come into question is in some of Braben's more outlandish
proposals to tackle what he emotively, incorrectly and utterly
unhelpfully described as retail "piracy". (He did, in fairness,
subsequently soften his tone and start describing it as "rental", which
is equally inaccurate but not quite so deliberately emotive.)
He talked in terms of unique codes which could be printed on discs to
activate them, or even taking the step of making a DRM-protected
download into the primary product, with the disc full of game data
being an "optional" add-on for those who don't wish to download a DVD
or Blu-Ray sized chunk of data. Essentially, Braben wants to find a way
to strip consumers of their rights over the game they buy. He wants a
way to ensure that you can't sell it, can't lend it, can't pass it on.
And let's be clear here - there was a lot of nodding in the
industry-heavy audience as he laid out this draconian stuff. He's
hardly a lone, Quixotian figure bashing away at windmills in the dusk.
The rights which Braben wants to take away from his customers are
called, in the United States, Right of First Sale. In Europe, it's
called Exhaustion of Rights. Both describe a similar thing - the fact
that once you sell a piece of media to a consumer, you automatically
give up certain rights in the process. You stop being able to enforce a
trademark action against the consumer for selling your product, for
instance; in essence, you drop all rights which could otherwise prevent
the consumer from re-selling the item they've bought. It is this right
which allows the existence of second-hand book stores, second-hand
record stores, and so on.
What Braben and others in the industry want to do is to usurp this
right, not through legal means but through technical restrictions.
There's something very questionable about the basic morality of using
technical instruments unthought-of when such laws came into force to
circumvent the law and rob consumers of basic rights. Exhaustion of
Rights and Right of First Sale aren't some grubby legal loophole that
consumers are using to rob hard-working developers of their money -
they're a fundamental part of the covenant between nation and creator
which gives us the copyright laws and allows creators to make money in
the first place.
More important than the moral and legal arguments, however, are the
practical ones. On a simple level, boiled and reduced, measures like
these don't just rob consumers of their rights - they also treat paying
customers like criminals. This is one of the most simple and potent
arguments against DRM and the majority of "anti-piracy" measures - what
they come down to is placing restrictions on legitimate customers which
pirates will not face.
Legitimate customers potentially wouldn't be able to lend games to
friends, bring them to someone else's house and play on their console,
or perhaps even pass them on to a younger sibling or cousin when
they're done. Pirates, of course, would continue to be able to do
anything they bloody well liked. On the scale of business own-goals,
vastly increasing the appeal of piracy to your consumers has to rate
pretty highly. Just ask the music business, assuming you can get an
answer in between the spluttering and wheezing as they recover from the
ferocious beating they've taken in recent years due to policies such as
this.
In Braben's defence, however - and I should reiterate that the vast
bulk of his talk was enlightening, entertaining and wonderfully
optimistic - he did also make some really positive suggestions about
how the second-hand market could actually be leveraged as a force for
good within the industry.
He talked about optional downloadable content, player subscriptions
and in-game advertising as ways to extract revenue even from copies of
games which don't return any initial revenue to your company. This is,
quite obviously, the approach the industry needs to take. If a copy of
a game passes through the re-sale process ten times, don't treat that
as ten instances of lost revenue - treat it as ten chances to sell DLC
to a consumer, or ten more sets of eyeballs looking at in-game ads.
Look at the positives of second-hand gaming, rather than grousing over
retail "piracy" or other such nonsense. By providing a market-generated
lower price point, it's giving more and more people access to games.
Quite simply, it's a total fallacy to think that the 35 to 40 pound
price point is the standard for games; if you want to know what
consumers are actually paying, try adding the second-hand and
discounted prices, and even the revenue returned to them for trading in
old games, and then reaching an average figure.
Chances are most games are being sold for well under 15 pounds, or
even under 10 pounds - around the cost of a DVD. Kick the stool out
from under the retail mechanisms that provide those price points, and
you'll lose thousands - possibly millions - of consumers, and risk
alienating an entire generation of teenagers from the industry. Find a
way to capitalise on all those extra eyeballs and players instead.
The second hand market isn't a problem for your business unless your
thinking is inflexible, traditional and rapidly becoming outdated. For
those with fresh ideas and the will to implement them, the second-hand
market is great news - and frankly, the day is coming when we'll say
the same thing about piracy and file-sharing. In the not too distant
future, businesses will wake up to the idea that if a million people
are downloading your game over BitTorrent, it should be the best thing
that's ever happened to your company, not the worst. My fear, however,
is that we're going to have to do the same agonising birthing process
that the music industry just went through before this kind of thinking
starts really making itself known.
(Gamesindustry.biz)
New Generation Consoles: and the score is ..
Tabloid Emotions: UK Games Censorship
The Soft Target
After almost a decade of watching with thinly-concealed smugness as
America's conservatives tore into the videogames industry, confident
that Britain's more liberal society would protect the medium on these
shores, the worm has finally turned. The alarm bells are ringing, and
an unpleasant awakening is upon us - Britain now faces exactly the same
kind of backlash against games that has blighted the United States for
years.
It is not, as yet, at the kind of fever pitch which anti-videogames
sentiments have reached on occasion in the USA. Britain fundamentally
lacks the sort of high profile youth crimes, such as school shootings,
which have focused attention in the United States - and when high
profile cases do come along, the UK seems more willing to condemn the
failures in society which have caused them, rather than trying to pin
everything on an easy scapegoat like videogames.
However, the atmosphere around games is shifting slowly and
unpleasantly, and nowhere is that to be seen more clearly than in
Westminster, the administrative heart of the United Kingdom. Here,
there's a certain measure of desperation in the air. Gordon Brown has
transpired to be a deeply unlikeable and unpopular Prime Minister, and
his Labour government faces the possibility of a humiliating defeat in
the next general election if a slide in popularity cannot be halted
promptly. Every straw in sight is being grasped at, and videogames, it
seems, are well within arms reach.
A "hard line" on videogames certainly seems to be one of the options
on the table for Brown's strategists, who know that the government
needs some kind of answer to questions of law and order, and especially
regarding youth crime.
The government's problem is that telling the truth - that Britain's
crime figures have been falling steadily for some time, and that we're
safer now than we've been for a long, long time - doesn't seem to work.
A vicious campaign of lies, half-truths and insinuations on the part of
the UK's vile tabloid newspapers (and, shamefully, some of our
broadsheets too) has convinced the population that UK society is in
meltdown. Faced with a population who believe that they're in danger of
being stabbed by a feral youth at any minute, the government can't
simply tell them to stop being so bloody stupid; it is forced into a
position of Being Seen To Do Something.
The something in question, I increasingly fear, will be the imposition
of restrictions, regulations and censures on the videogames industry.
This will come as part of a wider package of measures against the
creative industries. The BBFC, which has moved with the times and now
reflects Britain's largely liberal views on media, has also been
slammed in the right-wing press in recent weeks for allowing the
release of movies formerly classed as "video nasties" in the 1980s, and
it seems eminently likely that government will move to grant itself a
veto over the BBFC's decisions.
Admittedly, thus far much of the noise in Parliament on this front has
been made by Keith Vaz, an MP whose contributions to the videogames
debate are so frequent and so consistently ignorant and uninformed that
even his fellow parliamentarians have become sick of him. His shocking
and utterly false assertion this week that games are available in which
the player can rape women was challenged by Ed Vaizey MP, while his
ongoing promotion of the tragic Stefan Pakeerah murder case as an
example of videogame inspired violence (both the police and the court
system having ruled out any possible link) has been dismissed by the
minister responsible, Margaret Hodge.
Vaz' one-man quest against the videogames industry continues, however
- and indeed, it seems that it's not entirely a one-man quest any more.
While the headlines were stolen by Vaz' statements to the House, it
transpires today that Gordon Brown himself is to meet Stefan Pakeerah's
mother to discuss the question of violent videogames.
A triumph for Vaz, then, and a sad defeat for any modicum of common
sense. While Giselle Pakeerah's loss is truly tragic and saddening, her
claim that her son's murder was inspired by Rockstar's Manhunt is
patently and provably false. It was her son, not his killer, who owned
the game. The game doesn't even feature the type of murder weapon used
in the killing - and moreover, the killer was clearly inspired not by
playing a game, but by the debt he owed to a drug-related gang.
Giselle Pakeerah, in her grief, has been coldly and cruelly
manipulated, becoming a tragic champion in the battle against a medium
that had nothing whatsoever to do with her son's murder. Who, after
all, is going to argue with a grieving mother? What possible response
can Gordon Brown have to her statements - however ill-informed they may
be - than to nod sympathetically?
Moreover, I suspect that Brown - and those who have set up this
meeting, Keith Vaz himself undoubtedly among them - knows this
perfectly well. Gordon Brown doesn't want to be advised on his media
policy by Giselle Pakeerah. He wants to meet her so that when he
announces his already well-laid plans in this regard, he appears to
have consulted the grieving mother - which will play well for the
tabloid press who are hounding him to Do Something about the country's
allegedly rising crime levels.
It's a desperately worrying time for anyone with an interest in
freedom of expression, but more so for anyone involved in the creative
industries in the United Kingdom. One point of light at the end of the
tunnel may be the Byron Report, which is due out in the coming weeks. I
suspect that the report's author, Tanya Byron, is not likely to be a
willing patsy for the Labour government's preferred policies. This
report, with any luck, will actually set the facts straight. Whether
that will be enough to get videogames off the hook as Labour
desperately seeks to rebuild its public image, however, remains to be
seen.
(gamesindustry.biz)
No Hollow Victory
It's been a long time since any industry pundit was willing to bet on
the success of Toshiba's HD-DVD, but the protracted war over the future
of high-definition content delivery continued regardless. Staggering
and limping its way through a litany of awful sales figures and
high-profile studio defections, HD-DVD was the zombie format - struck
with lethal blows from all sides, but refusing to fall down and stop
twitching all the same.
This week brought merciful respite, and the end, when it came, was
swift. Months of horrible news for HD-DVD snowballed into an
unstoppable force after its studio support crumbled just before
January's Consumer Entertainment Show. A month and a half later,
Toshiba has finally pulled the plug - cutting the format's life support
off and consigning it to history's gallery of noble technological
failures.
The reason for HD-DVD's continued staggering across the battlefield,
mortal wounds notwithstanding, has been well aired by now. Although
ostensibly a Toshiba-backed format, HD-DVD's most staunch ally in the
past year has been Microsoft. Its HD-DVD add-on for the Xbox 360
accounts for around a third of total sales of HD-DVD players, and there
have been credible reports that the format's studio support was being
propped up by co-marketing deals funded from Microsoft's expansive
purse.
Microsoft's objective in all of this was simply to prolong the agony
of the high-definition format war. Divide and conquer has been a
strategy that has served Microsoft well over the years, and its
ambitions with regard to high definition content are very clear.
Although it sells technology used by both the Blu-Ray and HD-DVD
formats, Microsoft's hope is that consumers will ultimately spurn both
formats in favour of downloading HD content - preferably through
Microsoft's own services, like Xbox Live. If achieving that means
fermenting a format war that damages consumer confidence in both sides,
so be it.
So just how much damage has HD-DVD's zombie act done to the prospects
for high definition disc formats? Has it bought enough time for HD
downloads to become a realistic prospect for consumers, or even for the
concept to start to take root in their imaginations?
I'm not convinced that it has. Blu-Ray's victory comes early enough
not to be a pyrrhic one - and there are strong signs to suggest that
although downloads are beginning to earn their place in the HD content
market, there will be at least another healthy generation of disc-based
distribution before the world is ready to go entirely digital.
The problem which HD downloads face is simply that the market is not
yet ready for them. Broadband connections even in relatively developed
countries like the United Kingdom simply aren't up to the speeds
required for multi-gigabyte downloads of movie content. Although speeds
of 25 and even 50 megabits are advertised by some providers, the
reality for UK consumers is that their broadband probably runs at
somewhere between 2 and 5 megabits - and much, much lower in certain
areas. With some notable exceptions, much of the rest of the world is
in the same boat; the reality of broadband lags behind its promise.
Consumers, too, aren't quite ready for download content. I don't doubt
that they will be, and sooner than many pundits believe - the
attachment to physical products is not remotely as strong as some high
street retailers and content publishers would like to think, as the
incredibly fast transition from CD to music downloads is proving.
However, we're simply not quite there yet, and it certainly doesn't
help that few consumers are sporting home networks and properly
configured media servers, replete with large hard drives, in their
living rooms. Equally, it doesn't help that while consumers may be
prepared to shed their attachment to physical products, they're still
not going to give much ground on the question of ownership - and rental
models where movies "time out" after a certain period, or can only be
watched a certain number of times, are likely to prove to have very
narrow appeal.
This isn't to say that HD downloads won't form a part of the video
content market going forward - indeed, I suspect that the landscape of
the next ten years will be much more varied than the DVD-dominated
market of the last decade. Downloads, existing DVDs and Blu-Ray will
all have roles to play in this market - but the important news for
Sony, and arguably for the games industry as a whole, is that Blu-Ray
certainly does have a role in this landscape, and a very important one
at that.
Challenges remain, of course; Blu-Ray's prices need to come down, both
for hardware and software, before it can seriously start challenging
sales of DVDs, but already figures for the uptake of key Blu-Ray titles
are encouraging. Most of all, it's clear that Sony's "trojan horse"
strategy has worked. With over ten million PS3s sold through, Blu-Ray's
installed base from that console alone was more than ten times the
total HD-DVD installed base - and even if many of those users don't buy
too many Blu-Ray films, it still represents a very healthy potential
market for the format.
It's not fair, perhaps, to say that Microsoft's gambit has failed. If
Blu-Ray had become established a year earlier, it would have been a
serious blow to the Xbox 360, and to Microsoft's ambitions both in
downloads and in videogames. On the other hand, Sony can heave a sigh
of relief that the damage done has been fairly limited - and can
undoubtedly expect a major boost both for PS3 sales and for its share
price off the back of Toshiba's capitulation.
It's also worth noting that for the media market as a whole - from
consumer electronics through movies to games - the final end of HD-DVD
means the end of a major source of confusion over high definition.
Spurred on by strong sales of HD television, 2008 can at last become
what every year since 2005 has been predicted to be by various analysts
and commentators; the long-delayed year when high definition finally
takes its place at the head of the table.
(gamesindustry.biz)
A Question of Size
It's not terribly long since THQ looked like one of the best growth
prospects in the publishing sector. With a new commitment to quality, a
determination to build new IP and a strong pool of publishing and
management talent, the company's stock was cautiously tipped as a
grower - and it's certainly not an assessment I'd have disagreed with.
The acrimonious divisions that developed between the publisher and the
WWE wrestling body from whom many of its successful franchises had been
licensed seemed to have been a wake-up call for THQ regarding its
reliance on externally owned IP, and the future looked bright.
Now, I remain a firm believer in THQ's abilities as a publisher - and
I think that games like STALKER and Company of Heroes have done a great
deal to boost the value of the brand among gamers. By no means is it
time to start writing obituaries for the firm. However, it's tough to
spin this week's news in a positive light.
THQ has been forced to can a pair of racing franchises - Juiced and
Stuntman, both of which the firm acquired from other publishers with a
view to expanding its market share in racing - alongside a pair of
unannounced titles, the PS3 SKU of the upcoming Frontlines title, and
the PS2 SKU of the new Destroy All Humans game. In total, the firm
expects to suck in around $27 million in charges related to the
cancellations - and to close an entire studio, Concrete Games, which
was working on an unannounced title.
It's tempting to see this as a crisis for THQ, which has also just
downgraded its Q4 expectations due to game delays, and reported the
underperformance of licensed titles Ratatouille and Conan. However, a
wider view reveals that it's not just THQ that's facing trouble. This
malaise extends to almost every mid-range publisher in the market.
Tomb Raider publisher Eidos is perhaps the most high profile victim in
recent weeks. Talks with a takeover suitor collapsed, and with it the
firm's value on the stock market - followed promptly by the resignation
of the company's top management. It's worth noting that the management
themselves only arrived at Eidos after a takeover, having manoeuvred
plucky British publisher SCi into position to take over its larger
rival only a few years ago.
One company regularly mentioned as a potential Eidos suitor is Midway
- another mid-level publisher, big enough to run franchises like Unreal
Tournament and John Woo's Stranglehold, but unlikely to give the big
boys of the market any headaches in the near future. Midway, too, is
struggling to some extent; it hasn't posted a profit since 1999, and
has had to rethink its publishing strategy for 2008 in the face of the
weak reception for its titles this year.
These companies are the publishing B-list - they sit somewhere behind
Electronic Arts, Ubisoft and their ilk, but have well-established
sales, distribution and marketing operations, strong relationships with
buyers and media, and enough muscle to sign promising titles from top
developers. So what's going wrong?
Well, in each instance, there's a rather different set of factors
contributing to the individual problems of that publisher - but I think
those problems may, to some extent, be symptomatic of a change which is
being forced into the industry by the next generation transition. Put
simply, as games get more expensive for developers, publishers and
consumers alike, the challenges of managing huge teams and huge budgets
mount up - and it gets increasingly hard for a mid-level company to
compete with the industry's giants on a level playing field.
This happens to every media sector at some point in their history. How
many big film distributors are there? Break it down by removing the
child companies (such as Columbia Tristar and MGM, both of which belong
to Sony Pictures) and you end up with about five or six corporations
controlling the lion's share of the market. Music is even more
centralised - what was once a thriving market of small publishers has
been centralised into four major corporations.
The cost and risk of being involved in the games business took a huge
step up when the Xbox 360 and PS3 arrived, and the problems faced by
mid-level publishers could be the early symptoms of a major storm that
will only be weathered by firms with sufficient scale to survive.
Big companies face problems with being nimble and able to react, and
they often have difficulty controlling their costs - just ask EA, whose
development costs have grown at a rate far faster than its revenues in
recent years. However, they can also offer better deals for developers,
better incentives for distributors and retailers, and more lavish PR to
attract media coverage. They can better afford to take risks, can more
readily absorb losses from unsuccessful products, and their promise of
higher salaries, better benefits and more job security often attracts
the cream of the crop in terms of staff.
Such advantages spell problems for mid-level companies - and they
certainly make it foolhardy to try and compete on a level playing field
against them. Witness how badly Take Two was stung when it tried to
challenge EA's dominance of sports titles a couple of years ago. THQ's
attempt to hurl its racing franchises against the might of Burnout and
Need for Speed hasn't resulted in such a public defeat, but it's
unlikely to sting any less for that.
What can smaller firms do, faced with this situation? They have, I
suspect, two options in front of them. They can do what small companies
in music and movies do, and focus their efforts on original IP and
niche markets - taking risks on artistic products that could win a
discerning audience, or focusing on titles with a proven market that's
too small for EA to bother with.
The second option is, perhaps, more attractive - but might be even
harder to implement. That option is to get bigger, and the only way to
do that quickly is through mergers and acquisitions. Activision
Blizzard isn't the first merged firm to be created to try and achieve
scale in this market, and we doubt it'll be the last - and for the
likes of THQ, Midway and Eidos, deals like that could be crucial to
their future survival.
It's unlikely that any of the people who run mid-range publishers are
unaware of these pressures. Backroom discussions about mergers or
direction changes are undoubtedly ongoing at most of them right now.
The questions I'm wondering about is whether 2008 will be the year of
industry mergers and acquisitions; and if not, whether 2009 will be too
little, too late.
(gamesindustry.biz)
Six of One...
Retailers across Britain have been piling up tinsel, trees and
selection boxes in their stores since late September - earlier, I'm
told by complaining Scrooges, than any other year before, and certainly
early enough that many of us have tried stoically to ignore them for
over a month now. However, we've reached the point where even the most
festive-averse among us can't deny it. Christmas is, indubitably,
coming.
Oxford Street and Regent Street, the prime shopping streets of London
and hence of the British Isles, told the tale last weekend. Not yet
December, and already the streets were packed like sardines on a Sunday
afternoon, as hapless consumers ventured out in the mistaken belief
that they'd be early enough to avoid the crowds. Christmas is coming -
and while I can only take the word of the old nursery rhyme that the
geese are getting fat, the loud ringing of tills up and down the
country provides assurance that the pockets of retailers, distributors
and publishers alike are certainly piling on the pounds.
In the last half-decade, there has been a welcome rebalancing of the
games industry's financial years, which have finally stopped being
quite so ludicrously heavily focused on the October to December quarter
at the expense of long, barren months around summer time. Despite this,
the Christmas season is still a vitally important time. The incredible
pace of weekly releases since late September is evidence of this; the
long waiting lists for Wii hardware, and dwindling stocks of other
consoles such as the PSP, are further proof.
Therefore this is a timely moment to look through the releases of the
present quarter and consider just what impact they're going to have on
the marketplace - be that on the success of retail sales in the coming
weeks, or simply on the bottom lines of their publishers.
As such, GamesIndustry.biz has created a shortlist of the most
important titles on retail shelves in Britain this holiday season. Over
the space of two columns, I'll be talking through a dozen of those
titles - starting today with the first six, the more hardcore titles
which will be pulling in the key gaming demographic between now and
Christmas Eve.
Crossing the Divide
It won't come as a surprise to anyone that this shortlist is dominated
by cross-platform titles. While the last generation was a clear victory
for Sony's PlayStation 2, the emergence of cross-platform releases as
the industry's default was one of the most important trends to come out
of that era. It was always certain that this would be the case in the
present generation as well; it's only Sony's laggardly movement out of
the starting blocks which has slightly delayed the re-establishment of
cross-platform releases.
As such, there are only two platform exclusives in the six core
audience titles identified for this Christmas. Crysis, of course, is a
PC exclusive - and while its high system requirements will certainly
damage the overall sales potential of the game, that's not the whole
story here. Many PC gamers will see Crysis as a reason to upgrade their
hardware, and the amount of revenue it generates for specialist
retailers will be enormous as a result - with graphics cards, memory,
and even processors and full systems being sold off the back of the
title. After Vista's lacklustre showing on the gaming front, this will
be a welcome boost for retailers who stock hardware components
alongside software.
The other exclusive on the schedule is the Xbox 360 title Mass Effect,
which has had a positive critical reception and looks set to be the
360's last huge title of the year. It ends a stunning run of software
for Microsoft's machine which has cemented its place as the console of
choice for the core gaming audience. Carrying that reputation into a
second Christmas will be a major boon for Microsoft, and Mass Effect's
sales certainly won't suffer from coming in the wake of huge titles
such as Bioshock and Halo 3 which have helped to drive adoption of, and
interest in, the 360 platform.
Actually, there is a third exclusive on our list, albeit not one which
is exclusive out of choice. Epic's Unreal Tournament 3 will not be
launching on the PS3 in Europe this side of Christmas, leaving it to be
released only on the PC in that timeframe. Like Crysis, it may well
help to drive adoption of PC hardware upgrades; however, it is not as
high profile as Crysis in the PC market, not least because it has been
so heavily promoted as a PS3 title. Its delay is disappointing;
however, its appearance on Sony's console next year will probably be
popular with those who have picked up a PS3 over the Christmas season
and are keen for new games.
That leaves three huge, third-party, cross-platform titles which will
appeal to the core gaming audience - each of which seems set to be a
major hit in the extremely tough, but vastly rewarding, pre-Christmas
market. Activision's Call of Duty 4 has attracted rave reviews, and is
picking up extremely good word of mouth recommendations - the only
concern over its performance being the possibility of "first person
shooter fatigue" in the market after Bioshock, Halo 3 and Valve's Half
Life 2: Orange Box.
Ubisoft's Assassin's Creed, however, hasn't fared quite so well
critically. There have been mixed responses to the game among reviewers
- and its major audience, core gamers in their twenties, is the
audience arguably most likely to pay attention to specialist press
coverage. However, it's tough to see Assassin's Creed suffering
terribly from reviewing poorly in the coming weeks - not least because
Ubisoft's extremely high profile advertising campaign for the title is
certain to drive high sales.
Finally, it's perhaps the dark horse of this list - but Eidos' Kane
and Lynch: Dead Men, which arrives this week alongside Mass Effect,
could be the other core gamer title that really flies off the shelves
in the next four weeks. Developers IO have shown their ability to
create enduring franchises in the past, and Kane and Lynch's mature,
cinematic style - backed up, undoubtedly, with a strong marketing
campaign - could press all the right buttons. It will help, of course,
that this Christmas is unexpectedly lacking Grand Theft Auto IV - a
title which should have appeared last month, and whose pent-up demand
Kane and Lynch is perfectly positioned to tap into.
(www.gamesindustry.biz)
Teach Those Who Can't
Anyone who has ever wasted a significant amount of time on the
Internet - and this being the games industry, it's a safe bet that most
if not all of our readers are well within that demographic - has
probably encountered a simple quiz called the Political Compass.
It's a popular web application which poses a number of key political
statements, and asks you to mark whether you agree or disagree with
them. Your answers are then plotted on a two-axis graph, which in
theory tells you whether you're more Mahatma Ghandi or Margaret
Thatcher in your thinking.
One aspect of the quiz which has struck me on a number of occasions is
the following, presumably contentious, statement: "There is now a
worrying fusion of information and entertainment."
The statement is presumably there because it represents a point on
which opinions diverge significantly - but from the point of view of
those embroiled with the videogames industry and its products, it's
tough to see how anyone could see the union of information and
entertainment as a negative, worrying thing.
However, that proposition came back to me upon reading comments from
esteemed film producer and politician Lord Puttnam to the Virtual
Worlds Forum this week. Speaking about the potential for developers to
successfully lobby the government for state aid, Puttnam highlighted
educational and cultural value as being key to this campaign.
"Build education capacity into the function of your games and you
might get state aids," he told the Forum. "Otherwise you don't stand a
snowball's chance in hell."
His comments aren't hugely controversial, for the most part. After
all, one of the key things which has separated television and film
(both relatively heavily state-aided) from videogames over the years is
the fact that Westminster is sold on the concept that TV and movies can
be educational. The debate over the cultural value of those media is
long-over; art, expression and common sense won a resounding victory.
Videogames are still halfway through that struggle - if even that. The
medium is still fighting a rearguard action against ill-informed,
sensationalist attempts to turn it into a scapegoat for crime and
violence. That's a battle which will probably only be won when Rupert
Murdoch finally bites the bullet and buys a game publisher, a move
which will undoubtedly silence the shrill hackery of outlets such as
Sky News, Fox News and The Sun on this topic.
Only once that particular battle has been consigned to the graveyard
of history will the industry be able to start the process of convincing
government - and, indeed, society at large - of the educational and
cultural value of its products.
That process in itself may be a slow one. This goes back to the
Political Compass statement I mentioned earlier; the idea that the
fusion of information and entertainment is seen as "worrying" by many
people. Indeed, I'd go somewhat further than that - I believe that
there are a great many people who simply don't believe that information
(and by extension, education) and entertainment make for good
bedfellows at all.
Much of this is down to a simple misunderstanding. To address Lord
Puttnam's comments directly, I'd argue that many virtual worlds and
massively multiplayer environments are actually very educational - just
not in a straightforward manner which is easily presented to committees
of people who have never experienced this kind of environment.
Be it a world overtly focused on creativity and commerce like Second
Life, or one ostensibly focused on role-playing and combat like World
of Warcraft, virtual worlds offer their players an opportunity to
interact socially and commercially in a relatively safe, enclosed
space.
These worlds feature intricate economic models in which players buy,
sell and trade, where markets fluctuate and investment values can fall
as well as rise.
They demand that players develop and demonstrate the ability to
interact socially to accomplish goals with large groups of others,
building the kind of diplomacy, leadership and teamwork skills that
corporations pour countless millions into paintball venues to nurture
later in life.
As virtual worlds develop and evolve, they will continue to add vastly
more such opportunities to the mix. Worlds set in historical
environments will educate users as they play; worlds with more advanced
economic models will allow people to experiment with businesses and
entrepreneurial ventures in a low-risk environment.
We will even see worlds with advanced enough content tools to allow
creators to build art of many different forms in virtual environments.
None of this is blue-sky, far-future thinking. All of these things
exist in forms that are far from rudimentary already, and will continue
to evolve at a rapid pace in the coming years. Will this be recognised
as educational, though? Will the immense cultural and social value of
such progress be identified by those who make such judgements on behalf
of the nation's purse-string holders?
Perhaps they will - but I confess to a degree of pessimism here. The
breakneck pace of progress has smashed information, education and
entertainment together, and the shape of things to come is only now
emerging from the wreckage - held together with high technology,
networked environments and advanced interactivity.
Given how long it has taken to convince the world that comparatively
simple, linear gaming experiences are not a tool of Satan, can we
really expect that virtual, networked worlds will be embraced with open
arms without a massive fuss?
In other words, I think Lord Puttnam's comments, perhaps, make more
sense the other way around. MMOG and virtual world creators should not
be scrambling to make their games more "educational"; they are doing a
fine job of that already, without even knowing it. However, they should
not count too heavily on the idea of state support, either.
The state is a conservative and slow-moving beast - the job the market
faces is not to make their products more educational or culturally
valuable, but to demonstrate that value to people to whom these ideas
might as well be in a science fiction novel.
I feel fairly strongly that the idea of state aid for a sector such as
this is a bit of a white elephant. Cutting edge online and games
technology is a front that moves far faster than the public sector can
keep up; the focus now, as ever, must be on the pace of progress,
rather than on trying to bring the mandarins of Westminster along for
the ride.
(Gamesindustry.biz)
There's almost a sense of festival around the launch of Bungie's
long-awaited Xbox 360 iteration of the Halo franchise. We won't see
official sales figures for the UK (or, indeed, most other territories)
until next week, but Microsoft's Shane Kim already seems on the verge
of exploding with joy over $170 million first day sales in the USA,
with various retailers also being rolled out to express how ecstatic
they are over the figures.
Suffice it to say, then, that Halo 3 has done really rather well -
critically, it has scored over 90% from almost every specialist
publication in the Western world, and commercially, it seems certain
that its launch day is the biggest ever recorded by a videogame.
Consequentially, it may well be the biggest launch day for any media
product in history - although the caveat here is that this applies only
to the dollar figure. Halo 3's comparisons with other videogame
products are eminently valid, but the success of the game in comparison
with products in other mediums is inflated by the high price-tag of
videogames.
Bring it back to actual unit sales, or the basic number of people who
engage with the product on day one, and the figures don't hold up. It's
wonderful that so many people are willing to go out and pay a large
amount of money for a great game - but while back-slapping is certainly
in order, let's not kid ourselves that this represents a "mass-market"
phenomenon on the same scale as a huge movie or music release.
This is where the Halo message gets slightly confused. The game sits
on a peculiar middle ground between Microsoft's two key ambitions for
the Xbox platform. On one hand, the game itself is quite clearly a
hardcore gamer's dream - wonderfully polished, crafted and presented it
may be, but at heart it is still a heavily multiplayer focused
first-person shooter where you play a space marine taking on an alien
invasion. For the core audience of Xbox 360 owners, there couldn't be a
finer product.
On the other hand, the "media event" status which Microsoft has
carefully crafted for Halo 3 speaks volumes about the firm's
desperation to break out to a more mainstream audience. Months of
forward planning by the company's PR and marketing divisions has seen
Halo 3 being widely reported upon in the mainstream press, with
television, radio and newspaper reports focusing on launch events
around the world.
In London and elsewhere, launch parties were arranged with a coterie
of "celebrities" for the tabloid papers to take pictures of. The queues
outside retailers were the subject of news reports, and major news
outlets cast the net far and wide to try and find anyone who could
explain something about the game on air. My own Halo 3 launch day
started at 5am with an interview on the BBC's World Business Report -
which ended with the rather bemused presenter asking earnestly (and,
frankly, somewhat hopefully) whether videogames were "just a fad".
That, in a nutshell, is where the cracks start to show in the Halo 3
phenomenon. This is not a game for the mass market; it's not the kind
of game that will encourage casual players or non-gamers to engage with
the Xbox 360 or even with gaming in general. In fact, fantastic though
it may be, it's not even really a game that will appeal to anyone who
doesn't specifically enjoy the first-person shooter genre.
It is annoying, certainly, the much of the mass media has approached
the launch of such an anticipated game with a "look at the crazy
gamers!" tone in its coverage. It is frustrating to see features on the
London launch which focus on the fact that Pharrell Williams looked
"bored" rather than on the excitement of the gamers who turned up,
referring to them only in condescending terms.
However, it's not surprising to see this reaction. Unlike last year's
media frenzy around the Wii, the Halo 3 launch isn't something that can
be easily expressed to the non-gamers who cover this subject for the
mass media. The Wii is a genuinely mass-appeal product, simply because
its appeal can be summed up in simple anecdotes that easily sell the
features of the system to a wide audience. Halo 3, however, is a
gamers' game; a refinement of a genre whose appeal is almost
exclusively to existing players.
We fully understand Microsoft's desire to push the Xbox 360 into the
mainstream - after all, this very column has been advocating for years
the idea that the firm needs to broaden its appeal if the 360 is to
break out of the market segment which the original Xbox carved.
However, Halo 3 is the wrong product for the job. It is a game which
will bring core gamers more firmly onto Microsoft's side than ever, but
whose vast public exposure risks painting the 360 further into the
"hardcore only need apply" corner.
What Microsoft needs is not more widespread exposure for an
established, core gamer franchise like Halo 3. It needs a wider range
of gaming experiences to engage with a wider audience - the kind of
breadth and depth of software library which ultimately drove the
PlayStation 2 to its immense sales in the last generation. On a
positive note, we're seeing mounting evidence that this kind of
software is on the way - but it remains to be seen how Microsoft plans
to inform the public of this fact. Much will hinge on its ability to
project a PR message effectively beyond its core audience.
In the meanwhile, none of this should detract from the undoubted
enjoyment that hundreds of thousands of gamers will be experiencing
this week from Halo 3. Whatever about the mixed media response or the
Xbox 360's place in the market, the game itself is a triumph for
Bungie, for Microsoft and for the core gaming public.
Anecdotally, we've never seen so many of our friends on Xbox Live at
the same time, and all playing the same game (bar the occasional weird
refusenik, of course). Gamers' enthusiasm for the franchise may leave
the mainstream media cold - but that won't stop us from taking great
pleasure in Finishing the Fight.
(Gamesindustry.biz)
We've discussed Sony's next-gen strategy at some length in this column
before, but with each press conference, it seems that the firm's
attitude to the market becomes more confusing.
In the wake of yesterday's conference in Leipzig, for instance, it's
as obvious as ever that Sony's main focus at present remains firmly on
the PS2 and the PSP - profitable platforms with healthy installed bases
and thriving software sales.
This isn't surprising - indeed, we've previously attributed many of
Sony's more unusual decisions with the PS3 (such as the ludicrous dance
it played around the "value proposition" at E3) to a desperate need to
avoid rolling over and crushing the PS2 by pushing consumers to
next-gen too quickly.
As such, it wasn't a surprise to see SCEE boss David Reeves devoting a
fair bit of time to talking up the PS2 in Germany - and noting along
the way that the venerable console continues to outsell the Xbox 360 by
a large margin.
That's an uncharitable stab at a rival, certainly, but also an
important and sobering factor to consider in any discussion about the
next-gen battle. Like the current spat between HD-DVD and Blu-ray, it's
still a format war which has no relevance to the vast, vast majority of
consumers, as they remain perfectly satisfied with their existing
platforms.
Equally, plenty of time was devoted to the PlayStation Portable, a
system whose sales have been rather eclipsed by Nintendo's DS, but
which has been reasonably successful in its own right - and is almost
certainly very profitable for Sony.
The big deal for the PSP in Leipzig, however, wasn't new games - or
even the new PSP Slim And Lite hardware, which launches here in a few
weeks' time. Instead, the likes of God of War, WipEout Pulse and
Pursuit Force were given short shrift in favour of new "services" for
the system - non-games software which Sony hopes will push the console
out into new markets.
So now you'll be able to use instant messenger and voice chat over
wireless networks using Go! Messenger, work out travel plans and find
local services on the GPS-enabled Go! Explore, and view television
content from Sky on the move using yet another Go! branded service.
None of this is in any way a Bad Thing, but it's an unusually
scattergun approach to take with a product. Sony's strategy here, it
seems, is to add functionality until a tipping point is reached where
the device has enough desirable elements that consumers can use to
justify the purchase to themselves.
That's logical enough, but leaves very unsettled feelings about the
future of the platform. The concern is that the PlayStation brand is
becoming very diluted by Sony's determination to focus on things that
aren't, well, Play.
A similar issue exists with the PlayStation 3, and it's here that
there's real confusion about Sony's intent in the market. The addition
of a digital tuner and Freeview function to the console is a logical
step, which allows it to act as a hard disc recorder for television -
not exactly earth-shattering, since such devices can be bought for
under a hundred pounds, but certainly a nice addition to the console's
value.
However, the focus in Leipzig zoomed in tightly on this announcement -
and, curiously, on social gaming, with strong focus on next-gen
iterations of Singstar and Buzz. Both of those are fantastic
franchises, but it's not apparent where Sony thinks they're going on
the PlayStation 3.
That area of social gaming, pioneered by SCEE over the last few years,
has largely been enabled by the enormous market penetration and low
price point of the PlayStation 2. On the PS3, with a small installed
base that hasn't even reached most of the "hardcore" market yet, such
products just look out of place - and it's downright confusing as to
why Sony would even want casual game fans to switch to the
(loss-making) PS3 right now, ditching the (profitable) PS2 in the
process.
The problem here, then, isn't a million miles away from the issue
perceived with the PSP. Both platforms find themselves being advertised
as something that isn't a videogames console; instead, they're being
pushed harder than ever as multi-function entertainment and media
devices, systems which have "something for everyone" regardless of
whether you're into games or not.
Because of this, there's a very real risk that Sony's message will
find itself trapped between a rock and a hard place.
On one side, you have the traditional early adopters of PlayStation
hardware - the millions of gamers who formed the core audience for the
PS2, and whose influence and advocacy should not be underestimated when
considering the reasons for the success of that console. If not
actually neglected, those people certainly feel unloved right now, and
worse, they feel that they're being asked to pay above the odds for
non-gaming functions when they just want a games console.
On the other side, you have the more casual, mainstream audience who
adopted the PS2 late in its life - or who haven't previously owned a
games console. This is a rich vein indeed, as Nintendo could attest -
but Sony's mistake here is that it is attempting to leap straight into
this market without first winning over the early adopters.
By doing so, it is missing out on the crucial word of mouth and
advocacy which it gained from the early adopter market in the last
couple of generations - indeed, it is actually generating negative word
of mouth, which is damaging its prospects immensely. Without that
positive advocacy at a grass-roots level, the firm's products face a
daunting prospect - trying to sell a hugely expensive PlayStation to
people who don't want a PlayStation, and aren't even sure if they want
an integrated, all-singing, all-dancing media centre.
With the battle between HD-DVD and Blu-ray taking another awkward
twist this week as Paramount and Dreamworks hopped back on the HD-DVD
wagon (assisted ably by around USD 150 million of inducement from
Microsoft, if industry scuttlebutt is considered trustworthy), Sony
cannot rely on an early victory in the next-gen DVD battle to lift it
out of its sales slump.
Instead, it needs to focus its efforts on retaking what it foolishly
assumed was its home territory - the core market of gamers who make up
the bulk of sales for any console (except, perhaps, the Wii) in its
first two years on the market.
This week saw Microsoft drop its price points and begin the first of
the massive software launches which will carry it through to Christmas.
Certainly, there is a question mark over Microsoft's ability to
continue the momentum of the Xbox 360 past the hardcore market. But
ironically, while Sony demonstrates a great understanding of how to
break out from hardcore adulation to mass-market success, right now the
firm seems to have forgotten how to accomplish Step One.
The software and services are, arguably, on the way - but the message
needs to be fixed. It's time for Sony to get back to basics, and sell
us again on what the PlayStation does best - Play.
(Gamesindustry.biz)
There has been quite a commotion in the UK about Rock Star's
Manhunt 2 being banned - the first computer game to be so.
Mstation's stance is simple - let adults make their own
choices. In other words, we don't like censorship. We also
believe kids should be protected against what feral adults
might like, and so there needs to be a classification system
and there need to be responsible adults.
In the UK, at least, there seem to be plenty of completely
irresponsible adults and, in addition to that, there's plenty
of evidence to suggest that the 18+ classification is widely
ignored in shops.
It's a problem - a societal problem. Clearly some people
need a little more education about looking after their
children for one thing. And as for Rockstar, they've been
playing this bottom-of-the-barrel game for ages now and
deserved the very expensive lesson dished out to them in both
USA and the UK.
But wait, there's more! ...
Sick Filth?
You'll have to forgive the British tabloid press for seeming a little
bit out of sorts this week. Normally slavering at the mouth at the
first sign of a violent videogame being condemned, the low brow red
tops have had their noses put out of joint after being utterly
pre-empted by the British Board of Film Classification.
After all, "Ban This Sick Filth" makes for a wonderful headline. "Some
Sick Filth Has Been Banned", however, looks a touch limp, no matter how
big you make the letters.
Tuesday's announcement that the BBFC has denied a rating to Rockstar
Games' Manhunt 2 represents a new stage in the debate over violence in
videogames. It is the first time that a videogame has been denied a
rating since Carmageddon suffered a similar fate ten years ago -
although Carmageddon's publisher, SCi, successfully appealed that
decision.
I ought to say, at this point, that I am deeply uncomfortable with the
fact that the BBFC - an organisation whose very name suggests
classification, rather than censorship - should be in a position to
make a decision like this.
British consumers and commentators have regularly noted that Germany
has a particularly censorious regime surrounding videogames, and that
the United States has an astonishing tendency to outrage over even the
mildest sexual content. The irony is that neither of those countries
actually censor videogames, in the strict sense of the word.
The German authorities can refuse a rating, which prevents a game from
being advertised but doesn't stop it from being sold. In the US, an
outcry over a game may cause some large retailers, such as Wal-Mart, to
withdraw it from shelves. However, in neither country can a game
actually be banned.
In the UK, however, despite a generally liberal attitude to media and
all forms of artistic expression, free speech does not enjoy the same
legal protections which it is afforded across the Atlantic. The result
is that the BBFC's refusal to certify Manhunt 2 means that it is now
entirely illegal to sell the game in this country.
Concerns over the mechanism of censorship, however, are secondary in
this instance. In the US, after all, Manhunt 2 has been "banned" just
as effectively by the actions of the videogames industry itself. The
ESRB, a voluntary ratings board, has classified the game as Adults
Only, and Sony and Nintendo have therefore refused to license it for
sale on their systems.
This is a voluntary, internal industry process of self-censorship
which is far more laudable than externally imposed censorship - but
nonetheless, the effect for consumers is the same. Manhunt 2 is banned,
on both sides of the Atlantic.
What's more important, if somewhat less comfortable a topic for
discussion, is the question of why this game has been banned. The BBFC,
after all, has not exactly been the most censorious of organisations in
the last decade.
The organisation has largely kept pace with changing social mores and
an increasingly liberal view of art and media in the UK, and has in
fact been a staunch supporter of the right of videogames to move into
areas of mature, adult content more commonly associated with older
mediums like film.
In the case of the Hot Coffee scandal, for example, a ridiculous storm
which threatened to shatter teacups across the USA, the BBFC rather
sensibly opined that the tame sexual content revealed by the Hot Coffee
mod did nothing to change their view that Grand Theft Auto: San Andreas
was perfectly fit for consumption with an 18 rating.
Indeed, comparing the BBFC of now with the BBFC which reacted so
strongly to Carmageddon in 1997 clearly displays the progress made in
attitudes within the organisation. It seems almost certain that were
Carmageddon to come before the BBFC censors today, it would pass,
uncut, without the blink of an eye. We even suspect that it wouldn't
garner an 18 rating in today's vastly more accepting climate.
The point here is this; Manhunt 2 is not merely the first game to be
banned by the BBFC in a decade. It is also the only game to be banned
by the organisation since its liberalisation.
It is a game which has been judged as being simply too cruel, callous,
unpleasant and disgusting to be granted a classification, in an era
when films like James Wan's Saw series and Eli Roth's Hostel make it
into cinemas without even a ripple of attention - either from censors
or from the tabloids.
This isn't a case of knee-jerk reaction to the controversy surrounding
the first game; it's well known by now that the links made between
Manhunt and the murder of a teenager in Leicestershire were tenuous at
best, and weren't supported by police investigating the case.
Besides which, the BBFC doesn't succumb to knee-jerk reactions. Nor is
this a case of videogames being discriminated against in classification
due to being a "new" medium, and the whipping boy du jour of the
conservative media. Time and time again, the BBFC has shown that it
understands and respects videogames.
Our discomfort at the fact that the board has the capacity to censor
at all has been allayed, for the most part, by the incredibly sparing,
informed and judicious use of that capability which it has exercised in
recent years.
In other words, with Manhunt 2, Rockstar has crossed the line - and
crossed it at a full tilt run, it would seem, since the BBFC was unable
to suggest any cuts that would bring the game in line with its
guidelines.
"Unremitting bleakness and callousness of tone in an overall game
context which constantly encourages visceral killing with exceptionally
little alleviation or distancing" is the key reason given for the ban;
we would encourage readers to recall that this is judgement of a
classification board which has happily classified Hostel and Saw, and
indeed, the first Manhunt game.
One commonly heard argument is that being a Wii, PSP and PS2 title,
it's impossible that Manhunt 2 could have the same level of realistic
gore and violence seen in live-action movies like the aforementioned
Hostel. However, this is an excessively simplistic way of looking at
the violence contained in games like this.
It's crucial to consider that in gory films like Saw and Hostel, the
viewer is placed at best in the role of an outside observer; at worst,
they are given the viewpoint of the victim, a technique used by
filmmakers to heighten the discomfort and reactions of the audience.
In a game like Manhunt 2, however, the player is in the role not of
the hunted, or of the victim (as they are in, for example, survival
horror type games); instead, they take on the role of the predator, of
the serial killer, of the murderer who enjoys inflicting pain and
torture.
There are certain parallels for this in literature, of course - Brett
Easton Ellis' American Psycho and Iain Banks' Complicity both deal, in
very different ways, with murderers portrayed in the first person.
However, the clear opinion of the BBFC - and presumably of the ESRB -
is that Manhunt 2 doesn't represent the sort of insightful commentary
represented by those works. This is killing, maiming and torturing for
the sake of it; this may, in fact, be the game which lives up to the
shrill claims of the conservative wing that games are "murder
simulators".
In making such a game Rockstar has been juvenile, shameful and
irresponsible. The right of creators to push the boundaries of media
and society must be balanced out against a simple sense of social
responsibility - something with Rockstar seems to entirely lack.
This will be seen in some quarters as a question of being the enfant
terrible of the games industry, a reputation which the firm seems to
relish; however, I disagree with that assessment.
At several points along the line, during the development of Manhunt 2,
people in management at Rockstar and Take Two have surveyed this
product and made a decision, based on pure financial logic, to continue
funding its development. This is not a question of art; this is a game
which, it was decided, would sell well as a commercial product.
That decision has now backfired spectacularly on Rockstar and its
parent company - and while we may be uncomfortable with the way in
which the game has been censored in the UK, the rapid and effective
self-censorship applied by the industry in the United States is
laudable.
Videogames are not murder simulators; the vast, vast bulk of the
attacks by the conservative right on the videogame medium have
absolutely no merit, and are based simply in a pathetic attempt to find
a scapegoat for wider societal problems.
Unfortunately, Rockstar seemed to view the accusations levelled at
this industry, and at this medium, as a challenge. With even the mostly
liberal minds in the BBFC apparently horrified, the message here should
be clear; the videogames industry as a whole doesn't condone the
overreactions we've witnessed in the media and among politicians in
recent years, but it fully understands where lines must be drawn.
The fact that videogames are not murder simulators is a solid defence
against the attacks of the conservative right; it is not an indication
of a gap in the market. Perhaps now, with an entire development budget
down the drain, Rockstar will be receptive to that lesson.
(gamesindustry.biz)
Microsoft's Xbox 360: seeing red
Rings of Red
Microsoft needs to act now on hardware failures - or risk losing
consumer support.
With all the accolades presently being paid to Nintendo for the
astonishing success of the DS and the Wii, it's understandable that
Microsoft occasionally seems a bit put out by the whole situation.
After all, the Xbox 360 sailed through the seemingly ambitious 10
million unit goal which was set for its first year or so on the market,
and is outdoing Sony's PS3 in most markets - a situation which few
would have dared to predict only a few years ago.
Given the circumstances, it's not hard to see why some more
ill-advised comments from Microsoft executives regarding the Wii have
seemed... Well, a touch bitter. Right now, Microsoft must feel like the
kid who stayed up all night learning all the best combos in Street
Fighter, only to arrive in school the next day and discover that
everyone else in the class has decided to play marbles instead.
Nintendo's resurgence, however, doesn't really detract from
Microsoft's success in real terms. Right now, the Xbox 360 is winning
the battle which it set out to win - namely, the battle with Sony's PS3
- and is showing no sign of relinquishing its dominance of the "real"
next-gen market.
I have always argued that this fight was Sony's to lose, and that
remains the case; what's happened here is that Sony has slipped up
badly enough, and fallen hard enough, to give Microsoft a clear shot at
goal. The problematic PR, delayed launch and presently weak software
line-up for PS3 are all fairly major concerns; the enormous price
point, however, is the most serious issue.
Prior to launch, plenty of people questioned whether the market would
support that pricing level - Blu-ray drive or not. The answer has
returned, loud and clear; no, the market will not support this price
point. Every day that Sony leaves the PS3 on the shelves with this
unattractive price tag attached gives its rivals more of a head start.
With flawless execution, Microsoft could sail into the space which is
being left by Sony's failures and build an Xbox 360 market share which
would be practically unassailable. In some regards, that's exactly what
it has done. Nobody can downplay the company's astonishing achievements
with regard to software; the Xbox 360 has a compelling line-up of
software on shelves, and an even more compelling line-up of exclusive
titles in the pipeline.
Games like Halo 3, Bioshock and Mass Effect make Xbox 360 owners feel
good about their purchase, and provide compelling reasons for Xbox and
PlayStation 2 owners to upgrade. Indeed, in the top ten Most Wanted
games chart compiled from user data on GamesIndustry.biz's sister site,
Eurogamer.net, seven of the top ten titles are Xbox 360 games. Two Wii
titles (Super Mario Galaxy and Super Paper Mario) make it into the
ranking; only one PS3 title, Metal Gear Solid 4, appears.
It's obvious, then, that Microsoft is doing more than just making
headway with the hardcore audience. Frankly, that battle is all but
won, and the onus is now on Sony to demonstrate that it is capable of
creating an offering for hardcore gamers that is as attractive as the
one Microsoft has crafted.
The obvious criticism - which is no less true for being so obvious -
is that there's precious little evidence of Microsoft's software
line-up managing to break out of that hardcore market. The company
still lacks not only the kind of Singstar, Eye Toy and Buzz titles
which drive casual market adoption, but also the Final Fantasies and
Tekkens which appeal to the vast mass of "average" gamers who lie
outside the hardcore market Xbox 360 has so far exploited.
This is, at least, a well-understood problem, and one which is widely
commented upon. It has, of course, done nothing to slow down
Microsoft's race to ten million; but it may make the next ten million a
lot harder to sell, and the following ten million almost impossible, if
the issue is not addressed.
However, there is another problem which Microsoft faces at the moment
- one which the company has shown even less sign of understanding, or
addressing. It is the problem of hardware reliability and customer
service, an area in which the Xbox 360 has a track record that is
nothing short of utterly appalling - and an area which Microsoft
absolutely must address, or risk handing the goodwill of the market
back to its rivals.
Of course, this too is not a new problem. Microsoft has been slammed
over the failure rate of Xbox 360 consoles, and its own poor customer
service in dealing with that matter, many times before - British
readers will undoubtedly recall that the firm was hauled over the coals
on the Watchdog programme here only a few months ago.
This problem hasn't gone away; in fact, from a consumer point of view,
Microsoft appears to have done precisely nothing to address it. While
the attention of the media may have turned to scrutiny of Sony's
failings, the vast numbers of Xbox 360 owners who have been let down
first by Microsoft's shoddy manufacturing, and subsequently by the
company's arrogant and unfair policies with regard to customer service,
have increased. Their voices are contributing to a groundswell of
unrest and negative buzz which will hurt Microsoft very badly indeed if
it is not addressed.
The problem is clear. A large number of Xbox 360 consoles from launch
onwards have shipped with manufacturing problems which have manifested
themselves in the dreaded "three red lights" - an error code displayed
on the front panel which means that the console has died, and needs to
be returned to Microsoft for service.
The number of systems which shipped with these problems is a matter of
some debate, but it's clear that it is a far, far higher proportion
than the company originally admitted. Early claims suggested that Xbox
360 consoles were only failing as often as you would expect from any
piece of consumer hardware - a figure generally agreed to be around 3
per cent. However, entire batches of consoles at launch were failing en
masse - and the reliability, although it improved, continued to be poor
for months afterwards.
Has this been fixed? Who can say - Microsoft has certainly made no
promises regarding enhanced reliability for the Xbox 360 Elite console,
so it's simply impossible to judge whether new machines rolling off the
production line will be any better than their predecessors. Even giving
the benefit of the doubt, that still means that millions of machines
from the "unreliable" period of the console's manufacturing are sitting
under televisions around the world.
This, however, is only half of the problem. For a new piece of
consumer hardware to display a high failure rate is damaging, but not
seriously so, as long as the company has a good system in place to
ensure that customers' systems are being repaired, and goodwill is
being maintained.
Unfortunately, Microsoft has made two massive blunders in this regard.
Firstly, it has taken to shipping refurbished systems to customers
whose consoles have died - not a huge problem in itself, but the
reliability of these refurbished machines is also vastly suspect, which
results in anecdotal cases where gamers have returned their consoles to
Microsoft three or even four times, with each subsequent console
suffering the same fault after a few months. These cases make
compelling "horror stories" for consumers, and have been widely
disseminated.
Secondly, despite its shameful appearance on Watchdog, and being
lambasted by the press over its behaviour, Microsoft continues to
insist that British consumers whose consoles have failed after its 12
month warranty period must pay GBP 85 (around 125 Euro) to have the
system repaired. Its customer service representatives are adamant on
this point, refusing to budge even when it is pointed out that these
manufacturing flaws are clearly Microsoft's responsibility under
consumer law, regardless of the terms of the firm's own warranty.
For Microsoft to rectify these problems will, of course, be painful
and expensive for the firm. It is also absolutely essential if its head
start over Sony, and the market goodwill it has built around its brand,
are to be even remotely meaningful over the coming years.
To hardcore gamers, consoles are "special case" items; they are early
adopters, generally have a large disposable income, and are willing to
accept all manner of problems and flaws in order to enjoy the games
they want to play. However, they are a small - if vocal - market. To
everyone else, to the vast ocean of consumers to whom Microsoft must
now appeal, if the PlayStation brand is to be unseated, a console is
just another piece of consumer electronics, and it is subject to the
same standards you would expect from your DVD player, your digital
camera or your toaster.
You wouldn't buy a specific DVD player, no matter how nice the
feature-set, if a friend had told you that he bought one last year and
had to return it to the manufacturer three times. You wouldn't buy a
certain digital camera if you heard that they routinely break down
after 13 months, and you have to pay around a third of the original
purchase cost to have them repaired. You wouldn't buy a toaster if your
friend had that model of toaster, said it made lovely toast, but every
couple of months it burns the bread and has to be replaced.
Silly examples? Not in the slightest; this is exactly the thought
process with which the average consumer, considering a next-gen
purchase, is presented. The Xbox 360 may be a magical box of wonders to
the hardcore gamers enjoying the likes of Gears of War and Crackdown,
but to the rest of the world, it's just another piece of consumer
electronics. If they hear horror stories about reliability and customer
service, they won't buy it - end of story.
Right now, those horror stories are proliferating; the word of mouth
about Xbox 360 is that the games are great, but the hardware is a
nightmare. If Microsoft is serious about reaching an audience with Xbox
360 which is bigger than the 20 million units achieved by Xbox, then
that simply isn't good enough. It's time for Redmond to stop burying
its head in the sand over this problem, and start coming up with
solutions - before its unhappy customers become one of Sony's best
assets.
(Gamesindustry.biz)
Do the death throes of music DRM mean anything for games?
It's not exactly been the loudest revolution of all time - in fact,
it's been so quiet that you might have missed it - but there has been a
genuine revolution in the music industry in the last fortnight. The old
order has been overthrown, and it isn't happy; a new, upstart approach,
widely lauded by the public and the grass-roots, is taking its place.
So far, it's been a bloodless coup, although it's hard to say how long
that will last once the financial results start filtering through in
the coming quarters.
Actually, it's not entirely true to say that this coup has been
bloodless. There's one head rolling in the basket beneath the
guillotine blade; it's ugly, unloved, and it's called DRM.
DRM, of course, is something most people in the videogames market will
be familiar with at this stage. At its most basic level, DRM is just a
concept - it's the idea of using encryption software to control what a
user can do with a piece of media they've bought from you.
For companies treading out into the great unknown of downloadable
content, DRM is a comforting safety blanket to clutch at; without it,
you're giving someone a file which they could easily just pass on to
one of their friends.
Needless to say, that scares companies involved in digital downloads
witless - and a plethora of DRM solutions have popped up to reassure
them that they're not just handing their whole business over to
pirates. That's the first problem; none of those DRM solutions actually
work with one another properly. You can't download music from the
iTunes store and play it on a Microsoft-compatible music player, or
vice versa.
That feeds into the second problem - a great, whopping, huge problem
with DRM and indeed, with a lot of ham-fisted copyright protection
efforts in general. Quite simply, DRM takes rights away from consumers
which they are used to having with other products.
A CD has no DRM; you can sell it to someone else, you can copy it to
your PC and play it on any media playing software, you can rip it to
any portable music device, you can copy tracks from it to make a mix-CD
for a friend.
Now, some of those uses aren't legal, and some of them even the courts
seem unsure about in some jurisdictions, but that doesn't actually
matter. From a real-world, grass-roots user perspective, those are the
things you can do, and do easily, with a CD. You can do the same
things, of course, with pirate MP3s which you download illegally.
Herein lies the rub - you can't do those things with legal,
DRM-protected music. Which means that, in a bizarre twist, legal music
has less actual value to consumers than illegal music.
Which is why, to a large extent, this old order had to fall. EMI was
the first of the big four music companies to buckle; it's launching its
music catalogue, without DRM, on stores like iTunes in the near future.
Now Universal looks like it's falling in line, with a deal with Amazon
to do likewise. The remaining firms, Sony and Warner, simply cannot
resist the trend which their two competitors have started. Music DRM
will inevitably collapse like a row of dominoes.
Why? Because eventually, it had to sink in that DRM wasn't just
angering geeks with blogs - it was hurting customers, and it was
providing them with a clear, logical and genuinely sensible reason not
to buy legal music. All of the threats of legal action and cajoling
appeals to people's better nature are meaningless if, at the end of the
day, your legal product is significantly crippled compared to the
illegal (but easily obtainable) alternative.
And as to the relevance of this decision to the videogames market?
Well, it's both more and less relevant than it appears at first glance.
A number of commentators - mostly out in the blogosphere - have opined
that this decision must, logically, have a knock-on effect on games and
movies. That's not necessarily true, because those mediums (and games
especially) actually come with very different consumer expectations to
music.
The average consumer is very used to the idea of being able to rip his
music, listen to it on multiple devices, copy it between formats and
even shuffle it around to create personal playlists. Those
expectations, however, don't exist for games, and only exist for a very
small (but growing) number of movie consumers.
Games, in particular, are seen as products which only work on one
device, which cannot be copied and cannot be modified. Under those
circumstances, DRM is far less of an issue than it is with music, and
the same pressures which have forced the hands of EMI and Universal
simply don't exist.
However, the revolution in music DRM still has important lessons for
the videogames market. All too often, videogames companies have
displayed a willingness to impose copy protection measures on their
software which actually seriously disadvantage or inconvenience
legitimate purchasers of the product.
On the PC, in particular, copy protection has often been mismanaged to
the point where playing a pirate version of a game can sometimes be a
better experience - and the advent of networked consoles opens up the
potential for similar mistakes to be made.
The core lesson to take away from the failure of music DRM is simple.
Copy protection should inconvenience pirates - but never, ever at the
expense of also inconveniencing legitimate, paying customers.
Failing at that key test is what drove the groundswell of dislike
against music DRM and the companies who imposed it. Their failures
should be foremost in the mind of games industry professionals as the
market pushes increasingly into digital downloads and concerns over IP
protection grow louder than ever.
(Gamesindustry.biz)
Mstation Games Review
Sat, 28 Feb 2009
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57 million. That, at a rough estimate, is the number of new-gen
consoles - Xbox 360, PS3 and Wii - that have been shipped worldwide to
date. Thanks to this week's flurry of financial results, we have the
first reasonably accurate breakdown of sales in ages, informing us that
the Xbox 360 has hit 19 million units, the PS3 is within shouting
distance of 13 million, and the Wii, leading the field by an impressive
margin, is sailing around the 25 million mark.
57 million. It's an impressive combined figure - but even if we assume
a neutral scenario, where this generation of hardware only reaches the
same installed base that the last generation did, we're still only a
third of the way through the sales curve of the systems. In the more
likely eventuality that this generation sells significantly better than
its predecessor, that proportion is even smaller.
It's worth taking a moment out here to consider the fact that the last
generation isn't doing so badly itself - nearly 14 million people last
year decided that they need a PlayStation 2 in their lives, giving it
healthier sales than either the Xbox 360 or the PS3.
That's not bad for a console that celebrated its 8th birthday back at
the start of March. Even allowing for the continuing slowdown in its
sales, it seems likely that the PS2 is going to gasp past the 150
million unit milestone before it breathes its last - the first console
ever to do so, just as its predecessor, the PlayStation, was the first
to break the 100 million mark.
Such figures put our 57 million number in perspective, to a large
degree. They illustrate just how new to the market the new-gen consoles
are, and how far they have to go to emulate the sales success of their
predecessors.
The figures also illustrate very effectively the enormous change that
the games market has undergone from the last generation to this one.
Some would argue that the biggest change has been high-definition, or
online. Some would argue that it's the rise of "casual" gaming. Those
are valid viewpoints, but I think that from a business standpoint, the
single most important change in the gaming market is fragmentation -
the diversification of the industry's output, and the accompanying
fragmentation of consumer spending.
In the last generational cycle, if you were a consumer who was keen on
videogames, you essentially had two choices - you could buy a gaming
PC, or you could invest in a PlayStation 2. With a single, incredibly
dominant console on the market, the alternatives (the Xbox and
GameCube, and handheld gaming in the form of the GBA) were essentially
niche interest devices, platforms which cultivated vocal and
enthusiastic userbases but whose broad commercial relevance was minor.
This was the pattern which had persisted for several years in the
games market. The PlayStation dominated its generation in a similar
fashion, and even in the era of famous rivalry between Nintendo and
SEGA, Nintendo's systems were the undisputed commercial champions. Over
20 years of gaming history, there have consistently been no more than
two realistic options for consumers with money to spend on videogames.
That has changed dramatically in the current generation. The PC, of
course, remains a viable and even healthy platform for many game
genres, producing million-sellers fairly regularly despite issues with
piracy and hardware expense, and the new generation of hi-def consoles,
the PS3 and 360, are locked in a proper battle for sales supremacy for
the first time in decades.
That's only the tip of the iceberg, however. The choice for consumers
is no longer simply between PC gaming and one or two high-end console
systems - instead, there's a whole fragmented universe of choice out
there, each sector exerting a pull on the finite (but growing)
collective wallet of the gaming public.
Take handheld gaming, for example. Despite the success of the GameBoy
and GBA, this was always previously a side-salad, with console or PC
gaming as the main course. The DS and PSP have changed that -
dramatically. 70 million DS consoles are in the hands of gamers, along
with close to 35 million PSPs. Even allowing for a lower software
attach rate than the home consoles enjoy, that's still a hell of a lot
of Pounds, Euro, Dollars and Yen accounted for.
Then there's the Wii - a console which arguably sits outside the
new-gen race, since its hardware specification belongs with the
previous generation of consoles. At the very least, it's indisputably a
very different beast, and it's got the most impressive sales curve of
any console in the history of the industry. 25 million today (more than
the GameCube sold in its lifetime), and 50 million projected by the end
of the year - that's way more than the N64 sold, and astonishingly, if
Nintendo hits that target it'll also pip the lifetime sales of the
legendary SNES. Again, more consumer bucks disappearing into a bucket
that isn't marked "new-gen consoles".
Of course, there's the PS2 - as I already mentioned, it's still doing
handsomely for itself. More than handsomely, in fact. Never mind the
hardware sales, check out the software - 154 million units of PS2
software sold in the last financial year, another big fragment of
"wallet-share". Hell, there are even individual games biting big chunks
out of the pie. Blizzard's World of Warcraft eats up over a billion
dollars a year of "videogame money". (That's even before you consider
how many games WoW players would potentially buy if they weren't
spending all their gaming time grinding virtual gold to pay their
repair bills from Serpentshrine Cavern raids. Or whatever.)
In many respects, this picture is positive. The fact that high-end
consoles and PCs aren't the be-all and end-all of the market any more
suggests a newfound diversity which will help to grow the demographic
reach of the whole medium. Moreover, it puts the brakes on the headlong
rush to more and more powerful systems which characterised the past
decade of progress. That rush will continue, but it no longer
constitutes the entire games business - and the existence and
commercial success of lower powered platforms, both handheld and home,
means that the barrier to entry for new developers is lowered
significantly. That's a good thing.
On the other hand, for publishers, the newly fragmented games market
does bring new opportunities - but it's largely just a massive,
thumping headache. For twenty years, they've been able to base their
business on supporting the PC, a dominant console platform - and maybe
a niche console platform if they were feeling charitable (or if a
platform holder greased the right palms).
Now, that's no longer the case. The 360 is leading the hi-def race,
but the slowly shrinking margin isn't large enough to justify doing
anything other than supporting the PS3 to an equal degree. However,
even those two consoles, for all the headlines they make and shelf
space they occupy, don't actually account for even half of the market.
The active handheld installed base is huge. The Wii is huge. The PS2 is
huge. Weird niche markets like MMOs are gradually getting around to
being huge.
With all these huge areas crowding for space (and more importantly,
cash), will any console hit the 100 million, or 150 million, figures we
saw last generation? Possibly, yes - but not because of genuine
dominance. Nobody is going to dominate this generation like the
PlayStation and PS2 dominated the previous generations - in fact, not
even the PS3 and 360 combined will have that kind of dominance.
Fragmentation is going to be tough, expensive and difficult for
publishers - but it's also laden with opportunity. The success stories
of the coming years will be those who learn to stop worrying and love
the diversity.
(Gamesindustry.biz)
Mon, 24 Mar 2008
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