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The biggest spender is not always the biggest winner

28 October on Blogs, Editorial  

Just a few days after my previous post, I read this amazing article by Emily Rogers that seems to agree with a lot of my thoughts - though her research is miles above mine. Not that the concept is entirely new - Nintendo was aware of the risk of increased development costs way back during the GameCube era. I quote  Genyo Takeda, Nintendo's hardware guru:

This may sound paradoxical, but if we had followed the existing Roadmaps we would have aimed to make it "faster and flashier." In other words, we would have tried to improve the speed at which it displays stunning graphics. But we could not help but ask ourselves, "How big an impact would that direction really have on our customers?" During development, we came to realize the sheer inefficiency of this path when we compared the hardships and costs of development against any new experiences that might be had by our customers.(...)It must have been about a year after we started developing Wii. After speaking with Nintendo's development partners, I became keenly aware of the fact that there is no end to the desire of those who just want more. Give them one, they ask for two. Give them two, and next time they will ask for five instead of three. Then they want ten, thirty, a hundred, their desire growing exponentially. Giving in to this will lead us nowhere in the end. I started to feel unsure about following that path about a year into development.

top_enMind you, this is an interview from around the time of the Wii launch, and talks about their decision even before the Revolution was announced. Now, let's see the contrast of that with what Takeshi Nozue said about the impressive Agni's Philosophy demo - he joins the choir alongside Epic demanding better specs for the next-generation Xbox and PlayStation.

A quick disclaimer before I continue: I truly appreciate Square-Enix's creation of a mixed team with members from the Japanese office and the western studio Crystal Dynamics. Their acquisition of Eidos was good news all around, with better funding for projects like Deus Ex: Human Revolution, the Tomb Raider reboot and the new Hitman title... all of those are amazing titles, only made possible by generous schedules and budgets. That said, let's think a little bit about one example Emily Rogers gave in her article: Max Payne 3. Amazing game, with a generous marketing budget... and the need to sell 4 million copies to break even. And to think not too long ago being a million-seller was a huge milestone for most games.

Let's have a little "story time" moment here. At the time of the PS3 and Wii launches in November 2006, I worked as a games journalist for a TV channel, and traveled to the US to stand in line to get both. Now, the PS3 was in huge demand, with long lines and a lot of people getting turned down despite camping in line for 48h - and several eBay listings marking up the already high price of US$599 (for the 60GB high-end version) by anywhere from 20 t0 50%. I managed to get the Wii fairly easy, though it was good that I stood in line (albeit for only 4 hours), because they flew from shelves and would stay hard to find for more than a year. Funny enough, PS3 started popping back up as returns on December 26th. The high price made the console reasonably easy to find and resulted in disappointing sales. You know things aren't all that great when Sony's CFO states that it's actually a good thing the PS3 isn't selling as much as expected due to substantial subsidizing of the console. What followed was a series of feature cuts - memory card readers, PS2 hardware compatibility... to bring the price down. It's no big surprise that once the hardware was priced competitively it started selling a lot better.

Now let's add the numbers. Square-Enix is asking Sony and Microsoft to make their hardware more expensive, so they can spend more to make better looking games which require a lot more sales to pay for themselves. As is, the company took almost half the life-cycle of the PS3 to release their flagship Final Fantasy XIII (which, by the way, is looking like it will require a second spin-off sequel to justify its costs), and it doesn't look like the fabled Final Fantasy XIII Versus being developed alongside with it is anywhere near release. And remember, the studio was one of the first to receive PS3 devkits, as evidenced by their early FF VII tech demo. Can you imagine what these titles already need to sell? Imagine what would become of a title based on that new demo... and imagine that their hardware requests would push console prices up, thus diminishing early sales and slowing adoption rates - which, in turn, means less software sales because of a smaller user base.

Taking into consideration the leaked Microsoft roadmap for Xbox, it seems clear that the company is aware that you can't pull another PS3 in the middle of a recession. While there is a considerable power bump, the company is clearly being conservative not only in raw horsepower and cost increases, but also energy consumption. We know that the WiiU is basically catching up to the PS3 and Xbox 360. And it's probably for the better - should the bar be raised again, we could be more than stifling creativity. Emily's analysis makes it pretty clear that more studios could be closing doors with such a bump.

I greatly respect Shinji Mikami as a game designer, but his recent comments about Japanese game development baffled me.

Hollywood spends like 200 million dollars producing a movie, and you can make an incredible movie with that sort of money. But Japanese movie studios don't spend anything like that. The difference in [the] scale of the budgets [is] the same in games. Japan needs to make games like Hollywood makes movies.

There are several weird quotes on that piece, but that one concerns me. This is not the first case of a Japanese developer disappointed with the country's production. Itagaki seems to agree on the need for bigger budgets. But it's funny to look at two other examples: Valve and Nintendo. Both have reasonably low budgets for their games, exercise extremely unconventional development cycles, don't rely on Hollywoodian marketing pushes... and yet their games sell just fine. And with one major difference: they don't break day-one records like Halo and Call of Duty, but unlike those titles, they aren't in the bargain bin in a couple months - they can hold their prices for years.

I love cutting edge games. I appreciate amazing graphics. I am not advocating the end of complex core titles. But I think Jason Rubin has it right. I've been keeping an eye on him since he took reins at THQ, and with each interview, I like to hear what he has to say. He is not giving up on the traditional business model, and not even criticizing Free-to-Play, Social and Mobile games, even if he doesn't want to go there. He is keeping his eyes open and trying to make the company fit in with the times. You can't expect the market to bend to your expectations - things work the other way around.

Before continuing, I really feel the need to reaffirm my respect for the so called "casual" games. I don't mind the term itself, but it has become a dirty word among so many, especially game journalists. Nintendo sees the casual gamers of today as the core gamers of tomorrow, but I think that's just a small collateral contribution. I think it's even more important that we have opened a whole new market segment, and it has helped fight prejudice against games. But not all is good about the casual titles.

I had some very nasty things to say about companies like Zynga, Rovio and Vostu. My gripe with them are with certain business practices: outright plagiarism, messy development practices, focus on cheap production values, hardball and/or immoral business practices - many times with the intent of stripping a bubble before it bursts. While Zynga has gotten better about investing in their productions, early on they seemed decided to ride the bubble as aggressively as possible, without ensuring the survival of the very genre that put them on the map.

The worst part is that sometimes they even instigate competitors to do bad stuff they didn't do themselves. When I meet people and mention I am a videogame journalist, I get a lot of comments like "Oh, like Angry Birds!". Part of me delights that just about everyone can name a game... but it breaks my heart that I just find it not to be a particularly good one. And I am not talking about it being a casual title. But let's compare these two titles: Angry Birds and Cut the Rope. Here is some video to illustrate:

Now, most people will agree that the strongest elements of Angry Birds are the charming characters and simple gameplay. Well, not only is Cut the Rope clearly more charismatic and more intuitive, but the levels themselves are all majestically designed - there are tons of them, and each is very creative and fun to solve. Gameplay in Angry Birds in weird unresponsive in my opinion: I can't seem to predict how the birds are going to fly, even when using the guideline from the previous throw. Maybe I suck, but it feels like you can't be good at it, it's more luck than skill. And it's not that the game has to be challenging, but it's like eating potato chips, you keep going back for more because you are never satisfied. And that's not the worst part. So Cut the Rope is superior in every way, and yet is not more successful.

Angry Birds, much like Farmville, was successful because it was in the right place at the right time. In its case, the early App Store. By gaining momentum and getting highlighted as a top download, it creates a virtuous cycle. That sounds like a good thing, right? Except for the most part it's quite the opposite. A lot of developers just started resorting to paying Click Farms to generate downloads, and because the App Store environment is absolute chaos, it's nearly impossible to predict how a game will fare - unlike controlled, more "political" environments like Xbox Live and PSN, you have an ecosystem that is harder to get to... but you are given the attention you deserve. I've seen way too many great games buried by crap that used cheap tactics to appear on the most downloaded lists. Rewarding quality is vital to any industry. Disrespecting that can lead to its death. Zynga did its fair share of being cheap and copying, but at least they started investing on quality after a while. Rovio's new title, Amazing Alex, has higher production values but it's nothing more than an Incredible Machine rip-off. Seriously guys, you are rich now, I am not asking for HUGE risks, but you could try something A BIT more innovative.

But on the other hand, there is so much exciting stuff out there. Cut the Rope is just one example, but during E3 I was totally blown away by The Act, an amazing title that gives an analog twist to Dragon's Lair, while employing unbelievable hand-drawn animation that needs to be seen to be believed. SimCity Social may still be a clickfest and certainly uses all the tricks in the book to be addictive, but the game involves some clever planning to maximize results - and you still get the satisfaction from having a custom look for your town... certainly the kind of product that serves as training wheels for the upcoming SimCity coming in 2013.

You might be asking yourself: what's your point? Weren't you complaining about companies spending a lot... and then you criticize studios for being cheap? What I believe is that we have a spectrum here that lies on a balance of investment versus innovation. There is space for the so-called Triple-A titles, which tend to be a little less innovative... but don't put so much money that you are going to regret it. And by the way, increasing prices, like charging US$59 for a PC title and then dropping an avalanche of paid DLC regularly right after launch? Not acceptable, so don't budget your game to depend on that on top of multimillion sales. You don't want your core gamers to start giving up on their hobby, and sooner or later they might if you keep abusing their wallets. On the other hand, the lower your budget, the more risks you can - and SHOULD - take. Portal was a risk, and see how that paid off. We need some new, creative products to keep our audience from getting jaded. Gamers are getting older... and sooner or later they will lose their reflexes and get grumpy. We shouldn't lose them just as much as we need to bring new audiences.

I love videogames. I have a soft spot for the quirkier, different games I found while growing up, before this industry had such strong marketing muscles and it was hard to find a game before you heard about it on the Internet months before. I remember how magical it was to dig an unheard game on a rental store and be surprised with some gameplay mechanic I had never seen before. This pleasure is pretty much gone now, between conservative production and media overexposure. Maybe I am getting grumpy with age, but I believe this magic is not gone, we just need to put some heart into it.

Esta postagem também está disponível em: Portuguese (Brazil)

Author, freelance videogame journalist, cinematography major and a little insane.

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