Has Rare Lost Touch With The Gaming Industry?

In an interesting interview this week at 1up.com, Peter Moore, now at Electronic Arts, believes the skillset that Rare holds is a bit dated for our gaming industry. Moore, best known in his role of VP at Microsoft in their Interactive Entertainment Business division, understands how great Rare and their games once were but seems to believe the industry has passed them by.

Looking at their latest Microsoft titles, mainly Perfect Dark Zero, Viva Pinata and Kameo: Elements of Power, it’s not hard to believe his statements as fact. None of the titles have blown away a market full of Grand Theft Autos, Halo’s and other top selling titles. None of their games hit the epic review scores of Bioshock or Crysis. It’s not all first person shooters are taking the big sales numbers; Spore was given rave reviews by online review sites (sans Amazon) and that’s a completely different style of game.

Popcap’s Peggle has had more fame and glory than some of the bigger titles from Rare, probably made with less money. Is Rare a dying breed of developers with no good direction to react to the changing ways of the game industry?

No. Peter Moore is missing a big part of the changes in Rare since their 2002 purchase by Microsoft. The major difference is… Microsoft. Microsoft had plans to make Rare Ltd as successful on their own console as Rare had with the Nintendo 64. Moore says:

“I thought ultimately [Viva Pinata] would be very successful — and you know, Microsoft, we’d had a tough time getting Rare back — Perfect Dark Zero was a launch title and didn’t do as well as Perfect Dark… but we were trying all kinds of classic Rare stuff and unfortunately I think the industry had past Rare by — it’s a strong statement but what they were good at, new consumers didn’t care about anymore, and it was tough because they were trying very hard — [original Rare founders] Chris and Tim Stamper were still there — to try and recreate the glory years of Rare, which is the reason Microsoft paid a lot of money for them and I spent a lot of time getting on a train to Twycross to meet them. Great people. But their skillsets were from a different time and a different place and were not applicable in today’s market.” (1up)

Perhaps if Rare had the ability to pick and choose their own platform for their own desires and innovation they’d have a killer Wii game for the market. Nintendo and Rare had a great partnership in the making of Donkey Kong Country, a product they couldn’t do on their own due to the intellectual properties but managed to create a memorable franchise when combining forces. Imagine, taking Donkey Kong to such awesome levels with a ground breaking and well crafted title with high quality graphics on a low quality system.

What about GoldenEye 007? A game that changed the first person shooter landscape on the console and sold over 8-million copies on a Nintendo platform. Along with their hot back log of titles is that of BattleToads, a game which was well received by reviewers but insanely difficult for gamers to master. Of course, Banjo-Kazooie was another great title from the folks at Rare, most of which was made famous on a non-Microsoft console.

What’s the lesson? Don’t point fingers at the creative talents behind the projects and future decisions when you’re boxed into a single console under someone elses name. For a developer to thrive and grow they need space to do it, they need to be fully able to access all the gaming hardware in the industry. Microsoft tried to fit a round peg and a square hole and paid $375 million to figure it out.

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Wallets Shrink, Used Game Market GrowsWallets Shrink, Used Game Market Grows

Over the last year we’ve seen developers scrambling to find “value add” features to new game purchases. Their goal is to convince the customer to buy new instead of used because developers don’t see a penny from a used game sale. While GameStop sees 48% profit margins from the used game market developers struggle to stay floating in the industry.

for-saleThis is not the fault of GameStop and their 48% profit margins because they’re only getting 7% to 20% profit margins (say analysts) on new game sales. As someone that’s run a game store online, if you’re getting 15%+ on a new game you’ve got some great hookups in the distribution channel or are buying in huge quantities.

Buying games in huge quantities to build profit margins can be a huge mistake in this industry. Gamers are fickle little creatures and they’re going to buy their top tier games for a few weeks and then sales will drop significantly. No retail chain wants to purchase a thousand copies of GTA IV (only as an example) and sell seven hundred over the first few week to be stuck holding onto a few hundred copies when the dust settles. Now you’ll have to put them on sale to get them out of the store because the hardcore gamer have already done their shopping and you’re not going to get any price protection if you’re not a major player in the industry.

Why take 7% profit margins when you can get 48% on a used game? The gamers don’t seem to mind because they’ll trade in a used copy of a sports title like Madden to save $5.00 on the latest franchise release. Gamers will buy Fable 2, beat it in a week and rush to the store to get the “most for their dollar” before the game gets stale and buy-back prices drop like a stone. Why not rent Fable 2 and save yourself $50.00? Of course, renting pisses off developers as well because they see no additional revenue.

While the economy struggles and consumers fight for their jobs, the entertainment side of life continues to grow. People would rather “cocoon” in their homes playing video games and watching movies on their brand new HD television because it takes them away from the low points of the economy if only for a few hours. History has shown us trends in entertainment during the down points of economies, it’s natural to want to get away for a bit.

But, consumers want to play these games on the cheap because their job may not be there tomorrow. Saving $5.00 knowing the store just took the title in for half the price doesn’t bother you; $5.00 in your pocket is better than in their pocket right? The fact that they just pocketed upward of 40% on the game doesn’t matter to you — it’s all about your bottom line!

While we’re bargain hunting during the recession developers are going to try and up sell you to a new copy of the game. If that means giving you special game items and features with a “one time code” upon purchase, it will be up to you to decide if it’s valuable. All the while GameStop will lock out the game industry from selling used games because 42% of their overall gross profit is from used game sales.

You, the consumer, benefits from a slightly cheaper game, bargain bin fire sales and additional game features if you do choose to buy new. The economic down turn is a great time to be a gamer, as long as you remain employed.

Video Games Are Entertaining, E3, Not So MuchVideo Games Are Entertaining, E3, Not So Much

Most folks in the game industry are already writing off E3 as an actual event to be attending. Even Wedbush Morgan analyst Michael Pachter is calling it “virtually useless” for both retail and investors. The writing is on the wall and the reasons are obvious.

Publishers and developers didn’t want to invest the millions of dollars to make E3 a glamour show of epic proportions anymore. The lights, camera and action are all what the industry is about; the hype wagon in full steam. Gamers eat up the hype, bloggers and journalist rely on the hype and action to build readership and keep them coming back for more and retail uses it to gauge new releases and get a grip of the future.

Without the entertainment value of E3 nobody seems to care anymore. Large scale gaming entertainment is reflected in the large scale events and, at the end of the day, we want our conferences and shows to reflect the emotion and exciting of the industry.

“E3 had much more of an impact when it was a show,” comments IGN.com vice president of games content Tal Blevins. “The video game industry is about fun and entertainment, and we should have a show that reflects it.” (gamasutra)

Everyone is sad to see the state of E3, it’s like a cancer patient waiting for their final diagnosis. It’s unfortunate, it’s going to get worse and life will go on without it. In its wake, new shows will crop up while old shows increase in audience, excitement, intensity and cost.

As one show begins to fade others will grow to replace it and developers will yet again find themselves spending millions of dollars to be the best of show.

Call of Duty: World at War Beta – Coming SoonCall of Duty: World at War Beta – Coming Soon

I don’t know anyone that can’t pass up a good beta, Call of Duty: World at War is no exception to the rule, especially for those gamers that pre-ordered the title already. It’s a great opportunity when you’re able to buy a game ahead of time because you’re a fan and get into the beta early.

Santa Monica, CA – October 13, 2008 – The dogs of war are being unleashed today, as Activision Publishing, Inc. (Nasdaq: ATVI) and developer Treyarch announced the launch of the multiplayer beta for Call of Duty: World at War on the Xbox 360® video game and entertainment system from Microsoft.  Console players can guarantee themselves a token by pre-ordering the game at North American GameStop retail locations,* or online at http://www.gamestop.com/Catalog/ProductDetails.aspx?product_id=71812. Call of Duty fans that register to become members at www.callofduty.com are also eligible to receive a token, but these tokens are limited in supply, so register today.  Windows PC fans can expect a multiplayer beta soon.  For more information about either beta and the opportunity to secure a beta token or key, fans can also visit www.callofduty.com/beta.

The Call of Duty: World at War multiplayer betas will provide players with an opportunity to play as U.S. Marines, German Wehrmacht, Japanese Imperial Army and Russian Red Army factions in a variety of game types (Team Death Match, Free-For-All, Capture the Flag and War), across three different maps:

  • Castle: The Imperial Japanese Army faces off against the Marine Raiders in a daytime battle, located on the grounds of an ancient, Japanese castle.
  • Makin: The U.S. Marine Raiders square off against the Imperial Japanese Army in a nighttime fight, set in an outpost on the Makin Atoll in the Pacific.
  • Roundhouse: The Wehrmact will fight the Red Army to the bitter end in a daytime struggle that features tank and infantry combat, set in a desolate, war-torn European train depot.

The betas will last for a few weeks; however, the full battle will commence on November 11, 2008 when Call of Duty: World at War is released to retailers nationwide.

Call of Duty: World at War is in development for the Xbox 360® video game and entertainment system from Microsoft, Games for Windows®, PLAYSTATION®3 computer entertainment system, Nintendo® Wii™ and Nintendo DS. The title has been rated M for Mature for blood and violence by the ESRB. The Nintendo DS version has been rated T for Teen by the ESRB.

For more information and exclusive updates about Call of Duty: World at War, visit www.callofduty.com

About Activision Publishing, Inc.
Headquartered in Santa Monica, California, Activision, Publishing, Inc. is a leading worldwide developer, publisher and distributor of interactive entertainment and leisure products.

Activision maintains operations in the U.S., Canada, the United Kingdom, France, Germany, Ireland, Italy, Sweden, Spain, the Netherlands, Australia, Japan and South Korea.  More information about Activision Publishing and its products can be found on the company’s website, www.activision.com.