- Smart Business Choices During Economic Downturns

Smart Business Choices During Economic DownturnsSmart Business Choices During Economic Downturns

November 6, 2008| schommer| 0 Comment| 1:46 pm

Many game studios are being dropped following a bit of an economic downturn in the United States and globally. Activision has to deal with being agile enough to survive the economic times like anyone else and has dropped a few games that had great potential.

Gamers continue to ask the question, “why?” when some of their highest potential games were dropped to the floor. Ghostbusters and Brütal Legend are a couple examples of games with eager fans already salivating prior to its launch. Some of these fans are a bit ticked off that Activision named them as dropped franchise opportunities.

People ask why a company holds one “mediocre” title while getting rid of other potentially awesome ones. Don’t forget, this is a business and a good studio/publisher is going to make good business decisions without emotional attachments – those that bring emotions into play may end up with a highly valued product (to them) with no additional potential and lower revenue. This isn’t to say developers cannot be passionate about their games and their industry, they just have to build games gamers will buy and continue to fall in love with release after release.

Activision CEO Bobby Kotick is one of these business savvy individuals who knows where investors will find profits for the future, and he also know how to manage employees, with the use of software like this sample pay stub for payments and more.

“[Those games] don’t have the potential to be exploited every year on every platform with clear sequel potential and have the potential to become $100 million dollar franchises. … I think, generally, our strategy has been to focus… on the products that have those attributes and characteristics, the products that we know [that] if we release them today, we’ll be working on them 10 years from now.” (1up)

Ghostbusters is a great example of a title which could be well received and fun to play but probably wouldn’t be an exploitable franchise. The game, based on a popular movie, has limited potential for yearly releases and huge franchise success. Ghostbusters fans would probably disagree, but that’s when emotion comes into play. Think dollars and cents, not awesome fun gaming.

Oddly enough many of these business decisions from Activision, Electronic Arts and other big publishers arrive when the economy is in free fall and investors are eying your revenue potential. People make their most important and, usually, unfriendly business decisions when their company is at risk.

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It’s sad to think money comes first and entertainment value comes second but we’re not the ones trying to make a profitable living in the industry. Put yourself in Kotick’s shoes as he walks into a board meeting to discuss future plans, road maps and profitability – you’d do what you have to do to keep your job, right?

Users Pwn MetaCritic Review SubmissionsUsers Pwn MetaCritic Review Submissions

November 5, 2008| schommer| 0 Comment| 11:34 pm

Although we’ve found Metacritic a userful resource for game reviews, many folks have gone on a user submission rampage to discredit games that haven’t even launched yet. Their first attack was on LittleBigPlanet followed by Resistance 2, now their hitting Gears of War 2.

While Gears of War 2 has a Metacritic score of 94/100 the user’s have reviewed it to be a 3.5 out of 10, with a bright red box around the user review due to its low nature we’re sure. Although users are free to give their own honest representation of the game from their perspective, Gears of War 2, as of the review dates, hasn’t been released yet – these reviews are bogus.

This style of attack was popularized in Spore, when Amazon got nailed with poor reviews of the game because Spore’s “Draconic” DRM made people angry. However, it’s more reasonable for people to voice their opinion on a known issue with a game; Gears of War 2 review spamming is just mean.

We use Metacritic as guidance when we do our gaming podcast to understand what games are rated in the industry, but we don’t use user reviews as our main guide. There are plenty of folks out there that may utilize these reviews in more seriousness because they may feel journalists reviews are tainted by advertisers or “the man” and want the common gamers opinion.

The common gamer cannot possibility be reviewing Gears of War 2 before the title has arrived. This is bogus. Metacritic has this to say:

“My advice for our faithful users is to focus your attention on the Metascore for this game and not the thousands of user votes, most of which have been submitted before said users have played the game. This is a gaming community, and if people want to stuff the ballot box, there’s not much I can do at this point. When we upgrade the registration requirements for participation on the site in the near future, this type of thing won’t happen. We’ll post the full legitimate user reviews upon the game’s release. As always, thanks for using the site.” (1up)

So, to those looking for holiday gaming gifts, keep this in mind while you start hunting down games you’ll want to buy.

TD Gaming Podcast 95: Bad Judgement of MMOsTD Gaming Podcast 95: Bad Judgement of MMOs

November 4, 2008| schommer| 0 Comment| 11:27 pm

This weeks gaming podcast covers two reviews, including LittleBigPlanet and Guitar Hero: World Tour. We also touch on a bit of retro NES history with ExciteBike. This weeks gaming news includes:

Nintendo to release old games with new controls
Analysts negative on Electronic Arts
Sony files patent for a motion sensing controller
THQ dismantles studios

We’re also stepping on our soap box and asking if MMO’s are too risky for consumers who buy into MMO’s that fail in under a year.

38 Studios Pulls EA and Blizzard Talent38 Studios Pulls EA and Blizzard Talent

November 4, 2008| schommer| 0 Comment| 1:57 pm

Formerly Green Monster Games, 38 Studios is growing a large pool of talented folks for their MMO endeavor. First, we heard R.A. Salvatore (writer of the Dark Elf series) was heading over to work on a story, art direction by Todd McFarlane (creator of Spawn) and now Irena Pereira from Blizzard and a sound designer, Aubrey Hodges.

Hodges has done sound for games like Kings Quest, Quake and even Madden NFL. Pereira was a World of Warcraft interface designer which allows us to invision a bit about what 38 Studio’s MMO may look like from a user interaction perspective.

The MMO, currently titled Copernicus has a tentative launch date of 2010, which seems short for a full MMO design but they’ve been hard at work for roughly two years. Not too shabby a team for a privately held company founded by baseball star Curt Shilling.

It’s important to note Shilling is an avid gamer and loves massive multiplayer online games. What else does a man with a lot of money do as a side project? Fund a company based on the hobby he loves! If anyone knows the best directions and qualities of an MMO it should be an experienced team guided by someone with a passion for the game genre.

We’ll have to wait and see!

Read on for the full press release

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Studios Closing: The Good, Bad and UglyStudios Closing: The Good, Bad and Ugly

November 4, 2008| schommer| 0 Comment| 10:50 am

Gamers around the world are going to feel the pain in the 2009 holiday season after the economy shakes apart many great development studios. Electronic Arts feels the pain of being a public company as their investors complain about lackluster revenue, THQ deals with closing studios to extend their runway and other firms will lose more headcount in the coming months.

It’s not all bad. But, it’s going to get ugly before it gets better.

The financial market has played tricks on everyone in our global economy and companies across all industries are going to feel a bit of a tightening around the belt. Investors are shaken and doing their best to protect their investments and cutting loose those that aren’t projecting profits in the near future. Game studios are going to slow their financial burn rates, trim a bit of the fat and hunker down the long term. The end result, next years holiday season will have a few less games because those games are being dropped to the floor now.

Mid-sized studios within larger firms may find their projects canceled or put on hold and their employees re-structured or let go while big studios assess what projects will make the long haul. This is the ugly side of the business, having to make a decision on what games stay and what games go with the grief of having to tell some of your best talent “goodbye.”

The bad part of the industry is occurring today, with publishers posting mediocre profits and trying to convince their investors to be patient and trust they’ve got a firm hold on their destiny. The game industry is not alone in this, many firms are reducing head count and many startups are finding themselves without series A or B funding; they’re closing their doors because the money is being directed to more stable ventures.

What’s the good in all of this?

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Circuit City Denied Sony Shipment, In TransitCircuit City Denied Sony Shipment, In Transit

November 3, 2008| schommer| 0 Comment| 4:29 pm

Circuit City seems to have a problem paying their bills or so it seems, as Sony stopped their shipments mid-transit and returned them before hitting the distributors command center. In this unfavorable market climate, with the holidays around the corner, it seems bad for Circuit City to lose the trust of Sony.

Sony is afraid, “Circuit City couldn’t pay for the shipments” so the merchandise was turned around and returned home. Considering Sony, more than likely, wouldn’t have shipped the products to start with unless Circuit City was in good standing suggests things might have been “learned” after the shipment left the docks.

Circuit City’s been in some bad situations before, having a rough time dealing with competition in a very low margin, high volume, world of electronic retail. I’ve witnessed CompUSA disappear after the local Best Buy moved in and now Best Buy sits about 80 yards from Circuit City.

This is unfortunate because Best Buy can use some competition before they take over the bulk of this industry leaving only Wal*Mart and a few smaller stores to keep them in check. Considering I just purchased a 2-year warranty on my Rock Band 2 drum kit at Circuit City I’m fearing I’ll have to break the hardware sooner than later!

(Thanks, Gizmodo)

Will Xbox Live Survive 2008 Holiday Stress?Will Xbox Live Survive 2008 Holiday Stress?

November 3, 2008| schommer| 0 Comment| 1:38 pm

This year many gamers will open new consoles for the holidays and many of those same gamers are going bring their console “live” on Xbox Live the same day. Traditionally we’ve found Xbox Live falls under the weight of the holiday rush much like Apple’s iTunes. Will we repeat history again?

Although a fully loaded Xbox Live service is money in the bank, how much money will Microsoft lose when gamers login for the first time to a service in a state of destruction? People say first impressions are extremely important, but Microsoft makes a poor first impression every holiday. Xbox Live’s Jerry Johnson told Eurogamer:

“I can tell you that when Robbie Bach is on the phone on Christmas Day calling people asking what the hell is going on, and that’s coming down from Steve Ballmer… that’s the kind of attention it got last holiday.

Many things have changed since then, and we realised [sic] the kind of growth trajectory we were on and had to prepare for it.” (Kotaku)

It’s obvious the top executives at Microsoft want to give customers a great first impression and, after a few repeated holiday down times, this year is the chance to change it all. By now, Microsoft should be fully aware of the holiday flash crowd and have a system ready to cover the load.

Plenty of gamers login because their console automatically signs in on startup, but a handful of those gameres will be shopping for Xbox Live Arcade games to see what Microsoft is now offering them and their new console. Many XBLA games the current 360 crowd is bored of will be fresh and new to holiday adopters so it’s very important to keep the system online.

Much like Amazon, sales will decrease when the service is busy or under heavy load. Hopefully Microsoft is ready to make a great first impression to new buyers and give them the option to buy high valued (high markup) electronic downloads.

Blu-ray Doesn’t Validate Your Console, SonyBlu-ray Doesn’t Validate Your Console, Sony

November 2, 2008| schommer| 0 Comment| 10:05 pm

Is Blu-ray dead? Tech Sites around the Net are calling it a “death spiral” and we’re now looking at the downfall of the winning high definition format. Many non-PS3 Blu-ray players are still in the USD $200.00 range, a bit high for mass market adopters, and people aren’t planning to run out and buy a Blu-Ray player in our economic slump.

What’s the market share of the Blu-ray product? Four Percent. Blu-ray and the PlayStation 3 have a lot of battle scares after the fight with HD-DVD to “win” the format war. In the end, Sony won the battle but the war was not with the HD-DVD format, it’s with the average Joe consumer.

Does this effect the PlayStation 3? One of the up sells of the PlayStation 3 was the Blu-ray capabilities, it games and it’s an entertainment device all-in-one. It’s a great deal right?

“The advent of low cost up-sampling DVD players dramatically cut the video quality advantage of Blu-ray DVDs. Suddenly, for $100, your average consumer can put good video on their HDTV using standard DVDs. When Blu-ray got started no one dreamed this would happen.” (zdnet)

The obstacles against the Blu-ray format are huge, especially with NetFlix coming to the Xbox 360, high definition download options and licensing costs on the Blu-ray to movie creators. Blu-ray won’t die in this generation of PlayStation 3 consoles but many folks, including Apple, are pausing to see if it has any chance at all to break into the industry.

Four percent just isn’t enough to inpsire confidence.

Games 2.0: User Generated Gaming?Games 2.0: User Generated Gaming?

November 2, 2008| schommer| 0 Comment| 9:37 pm

In a world driven by the Internet, global economics and the short attention spanned reader we’ve been bombarded with social networks and 140-character micro-blogging. We’re constantly finding ways to promote ourselves, promote our brands or tell people what we’re eating for dinner. Is this obsession with ourselves and our creativity bridging into video games?

It’s games 2.0 people!. A time when we’re inventing our own video game stages, characters and full blown casual games! Not only are people getting a chance to design their own games with Microsoft’s XNA, Adobe Flash or from small independent casual games, but we can design our own stages in games like LittleBigPlanet.

Microsoft wants to remind us that Boku is much like LittleBigPlanet in its user generated video game content. Seen in this video below:

It’s obvious their going down the same path as Sony has gone with creating your own stages with LittleBigPlanet and creating a new way of gaming: playing other people’s stuff. You can find some similarities with Guitar Hero: World Tour‘s ability to create your own songs and publish them for others to play.

Are we heading down a generation of games where some of the best stages are created by fellow dedicated gamers? Or, is this just a distraction and means for developers to have gamers invigorate and create more of a demand for the games they are making the money on?

(Thanks, Destructoid)

Trading Used Games, Like Fraud?Trading Used Games, Like Fraud?

November 1, 2008| schommer| 0 Comment| 11:38 am

David Braben, founder of Frontier Developments, says retail outlets that buy and sell pre-owned games are “essentially defrauding the industry.” Although multiplayer gaming might not be a huge threat, the single player experience in games may die out because gamers play the game quickly and resell it back to places like GameStop for others to buy.

Developers don’t get a dime when a game goes traded, many gamers will “share” the single player experience with a single copy of the game by reselling it over and over. The end result, retail outlets make a good penny for marking up old games while developers see nothing. This is really how game retail outlets survive because the margins on video games is so damn low.

The story has been heard before, developers want a piece of the action so they’re taking steps to entice people to keep the game with renewed downloadable content on old games; you can’t experience the new content without keeping the game around longer. In the world of low margin games, high cost development and short-lived story lines the solutions to this problem aren’t exactly obvious.

Braben’s idea of a solution is to offer two versions of the game, a not for resale/rental version at a high price, say $160, and a low priced version that cannot be shared (heavily DRM’ed?) for $50. In essence, gamers would no longer be able to trade in games because the idea of spending double for a game so you can resell it makes no sense to most gamers (including myself.)

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