The Nature of Success in the Gaming Industry

[ROG27]

I have been reading alot of Monday-morning quarterbacking commentary on the "run-away" success Nintendo with the Wii and the DS lately. I think most analysts, journalists, gamers, game-makers, and critics (did I miss anyone?) are missing the point. I most-recently read an article on the logical fallacy of the nature of the "casual gamer audience" by game companies, and I agree with much, if not most, of what the author says. I have a big problem with his analysis, though. It speaks truth but is bias at the same time...bias as in not giving weight to the concerns of gamers who enjoy a more complex, in-depth style of game at the top of the spectrum which he describes (read his article here: Birdmen and the Casual Fallacy by Sean Malstrom). He attempts to "rationalize away" (as he likes to say) the very real concern that "hardcore gamers" have...their type of gaming may be deemphasized by business types--the guys who make the decisions on what games will get made. He seems to lack empathy for these individuals. I'd like to readjust his train of thought to a more objective path. It is a model for having a successful gaming business that each and every company, if they plan on being successful, must follow. Atari met it originally, then Nintendo (8-bit era), then Sega and Nintendo (16-bit era), then Sony (32-bit era), then Sony again (last-gen), and finally Nintendo (current-gen).

The criteria for success in the gaming business can be summed up as follows:

"How to create a successful gaming platform...by Mike Rogers

Incorporate these 3 things in no particular order (each is as important as the next):

-Reasonable prices for system, peripherals, and games.
-An innovative technology/hardware shtick to initially draw people in.
-A diverse and wide-reaching library of software (ranging from simple/bargain-bin to complex/high-production values and inclusive of all subject matters and genres)."

All of the successful gaming platforms in history have met these basic requirements. The requirements, however, are relative in terms of the available competition. There is no measure of each in terms of absolutes. Remember that before trying to deconstruct what I am saying.

 

[Shifty Geezer]

Regards the nature of Wii's success, may I point out that of the existing console install base, most gamers don't want a Wii? Wii has less than 50% of the entire market share. I know modern political standards regard the largest portion of pie as being a majority, and this with almost 80% of potential voters not voting in favour of Labour, we still manage to have a 'democratically elected representative of the people' Labour Government, but I do wish people wouldn't jump the gun so much, dividing people into absolute winners and loses.

A successful console is one which earns the console company profit, directly or indirectly, as that's why they created it - that's the purpose of commercial business.
For the gamers, a successful console is one which provides them with entertainment they enjoy at a price they are happy to pay.
For the software companies, a console is a success if it provides them a viable platform that, targeted with the right software with an appropriate amount of effort invested, produces profitable sales.

There are different grades of success, so you can have a runaway success that makes the software developers life easier, providing a market with enough chumps that cheaply produced hackware sells in numbers and makes an easy profit. That doesn't make every other competitor a failure though.

I can only guess that contemporary values have been affected by decades of Adidas and Nike commercials, so that viewpoints are polarized into viewing success as being the alpha-male, numero uno, guy on top. Putting it another way, who here wouldn't want the sort of failure of the multi-billion-dollar making GC on their hands?

 

[tongue_of_colicab]

No offence shifty but could you please stop the constant stream of wii isnt for gamers, wii isnt bought by gamers etc? You never give any sources and at best you'll have anecdotal ''evidence'' which will be easy to contradict given how ''real'' games like re4 (released for like the 5th time when it came out on wii) still sold a million (along with plenty of other real games selling into the millions). It annoys me.

As for what makes a console a succes? I think if you're purely looking at selling the most the 3 things named along with image and marketing are important. The last 2 can mean a whole lot and they can also be a factor for cheaper games and a big libary. We saw that with the DC vs ps2. In no way the ps2 was even close to the DC in its first year. But because of alot of marketing sony managed to get people into the ps2 and creating a few of the conditions mentioned.

 

[RancidLunchmeat]

No offence shifty but could you please stop the constant stream of wii isnt for gamers, wii isnt bought by gamers etc?

That isn't what he said at all.

What he said is that based upon the population size of 'gamers', the majority of them have NOT purchased a Wii.

The question would be where he's arriving at his number for the population of gamers if you want to nitpick.

If you don't want to nitpick and just take a minute to understand his point, it's a good one. Even with the tremendous success of the Wii, most gamers have not purchased one. A LOT of them have, a majority has not.

Which is why Shifty then goes on to wax anecdotal about majorities and the like.

 

[BoardBonobo]

IMO success is either pinned down by the shallow bottom line 'we're making loads of money' short term look, or the longer term etching into the popluar 'zeit geist', how far your brand\IP\game whatever sinks into peoples minds that it becomes part of regular culture. Pac Man for instance ro even Pong!

 

[Shifty Geezer]

That isn't what he said at all.

It sure wasn't! Not sure what tongue_of_colicab was reading.

What he said is that based upon the population size of 'gamers', the majority of them have NOT purchased a Wii.

The question would be where he's arriving at his number for the population of gamers if you want to nitpick.

Current sales of consoles. The combined market of XB360 and PS3 is about 30 million, the market for Wii is about 26 million. And that's ignoring PS2 sales. Out of all the people who have bought consoles, more are not buying Wii than are buying Wii. In a pie-chart of current-gen market share, at the moment Wii has less than one half of the pie. A chart of sales might have Wii at 50% or so, but they're hard to come by!

And I have made no mention at all of audiences. Just pointing out that the initial definition of 'Success' seemed overly polarized to me.

 

[vazel]

You're assuming people only buy one console.

Edit: Oh wait I think I understand what you're trying to say. I still don't agree about your point. There is no burying the fact that the Wii is the most successful gaming console of this gen. Since when do the 2nd to last placeholders combining to form a greater percentage negate the winner when all those rest only get a piece of the pie each?

 

[Shifty Geezer]

Most successful, sure, and I ain't disagreeing with that. Is it the only one that's a success though? That all depends on how you measure success. The OP had a list of three criteria for a successful console, yet the real measure there isn't success but 'sales winner'. If you're only goal is to a win a race, then not coming first equals failure. But if your goal is make money, and you make $3 billion versus your rival's $5 billion, is $3 billion in profits really a failure just because managed better than you? What if your original aim was to make $1 billion?

My whole complaint is taking a front runner and naming then a success, and (by implication) everyone else a failure. Success has to be measured by pursued goals, and in that case any product can be a success and a failure depending on the targets it's being measured by. Just as all hardware has strengths and weaknesses, and you can't just label one console 'the best'. I already outlined three examples of 'The Nature of Success in the Gaming Industry' according to who you ask. If the OP really meant 'How to be the Number One Hardware Seller/Net Profiter in a Console Generation', I wouldn't have posted anything

 

[vazel]

I haven't read most people speak in absolute winner or failure. I haven't heard a console branded an outright failure since Sega's add-ons for the Genesis and maybe the Saturn to a degree. Of course the ones that aren't 1st place are still going to make profit. Nintendo did make profit during the Gamecube's lifespan. It's a big industry and that's why the ones at the top have the most to gain.

 

[oli2]

That isn't what he said at all.

What he said is that based upon the population size of 'gamers', the majority of them have NOT purchased a Wii.

The question would be where he's arriving at his number for the population of gamers if you want to nitpick.

If you don't want to nitpick and just take a minute to understand his point, it's a good one. Even with the tremendous success of the Wii, most gamers have not purchased one. A LOT of them have, a majority has not.

Which is why Shifty then goes on to wax anecdotal about majorities and the like.

That isn't what he said at all.

It sure wasn't! Not sure what tongue_of_colicab was reading.

He was certainly reading the exact same thing as me !
i mean why do you keep on insisting saying this, even if it is ATM perfectly correct ? It is as of now completly irrelevant.

(i question you on that, and i think that was his purpose)

My main concern with that point are :
1) Why suddenly PS2 count as "hardcore" machine as it is admitted widly that casual consumers made its success.
2) What will you say if / when Wii reaches 55-60-65% of market ? Will you stop counting in percentage and give raw "million" number as non-Wii console players ?
3) it seems to me you oppose Wii ("casual") to non-Wii ("hardcore") console players and have clearly shown your choice in this war. IMO, the war is between "next" and "new" gen.

If i am correct on your purpose, your argument is nitpicking ... You don't account trends and future projections, the fact that Wii came a year later than first entrant, or the fact that 18 monthes after launch PS2 was "only" at 13M mark (i know, it is unfair because of EU and US PS2's launch).

To sum up, it looks like a Sony PR, where they say "PS brand" sold more than DS or Wii, counting PS2 + PSP + PS3. My question to you here is "why don't you add Wii and DS to compare to "PS brand"" ?

 

[Readykilowatt]

He was certainly reading the exact same thing as me !
i mean why do you keep on insisting saying this, even if it is ATM perfectly correct ? It is as of now completly irrelevant.

(i question you on that, and i think that was his purpose)

My main concern with that point are :
1) Why suddenly PS2 count as "hardcore" machine as it is admitted widly that casual consumers made its success.
2) What will you say if / when Wii reaches 55-60-65% of market ? Will you stop counting in percentage and give raw "million" number as non-Wii console players ?
3) it seems to me you oppose Wii ("casual") to non-Wii ("hardcore") console players and have clearly shown your choice in this war. IMO, the war is between "next" and "new" gen.

If i am correct on your purpose, your argument is nitpicking ... You don't account trends and future projections, the fact that Wii came a year later than first entrant, or the fact that 18 monthes after launch PS2 was "only" at 13M mark (i know, it is unfair because of EU and US PS2's launch).

To sum up, it looks like a Sony PR, where they say "PS brand" sold more than DS or Wii, counting PS2 + PSP + PS3. My question to you here is "why don't you add Wii and DS to compare to "PS brand"" ?

You're right. Some posts in this thread looks eerily like it came right out of Sony's PR department. But, it's Beyond3D... Why are you surprised?

 

[Shifty Geezer]

He was certainly reading the exact same thing as me !
i mean why do you keep on insisting saying this...

T_o_c says I repeatedly say Wii isn't for gamers. I wasn't talking at all about gamers - I was talking about what constitutes a success (in all fields). You've both lost me completely! Maybe you can link in the many other posts I repeat this (amorphous?) point of mine in my Wii badgering campaign? They should be easy enough to find seeing as I repeat it so often

Furthermore, it'd be nice if people actually contributed to the topic. Few are actually commenting anything on what constitutes a success in the console space, instead preferring to play childish 'console wars' games.

 

[thatdude90210]

You can make the same argument against either the 360 or the PS3.

If you count individually, more gamers didn't buy x360 (19 mil vs 36 mil Wii + PS3) or PS3 (11 mil vs 44 mil Wii & 360).

See, the 360 & the PS3 aren't for gamers.

 

[Shifty Geezer]

Where the Hell did I say Wii wasn't for gamers?! Why in the blazes is everyone putting fictitious words into my mouth?!? Yes, you can make the same argument, about all platforms. None is in ascendancy such that most gamers prefer that one system. In exactly the same way you can't say most voters voted for one of the British Political Parties. None of them represents a majority of the voting public. None of the consoles represents a majority of the console buying public. This is key to the issue of discussing success in the console space, because it is a bad habit of people in general to take the leader in one field, such as best selling box, and extrapolate all sorts of accolades without a truly balanced perspective.

Ah, heck, I can't be arsed with this moronic discussion.

 

[Nesh]

Where the Hell did I say Wii wasn't for gamers?! Why in the blazes is everyone putting fictitious words into my mouth?!? Yes, you can make the same argument, about all platforms. None is in ascendancy such that most gamers prefer that one system. In exactly the same way you can't say most voters voted for one of the British Political Parties. None of them represents a majority of the voting public. None of the consoles represents a majority of the console buying public. This is key to the issue of discussing success in the console space, because it is a bad habit of people in general to take the leader in one field, such as best selling box, and extrapolate all sorts of accolades without a truly balanced perspective.

Ah, heck, I can't be arsed with this moronic discussion.

What? You still insist? Will you stop saying that Wii is NOT for gamers already? I am tired of you! You are braking my nerves!!

*runs away*

 

[Zassk]

You're assuming people only buy one console.

NPD recently reported that only 3% of console owners own 2 consoles, and less than 1% of console owners own 3 consoles. So the assumption is valid.

 

[thatdude90210]

Where the Hell did I say Wii wasn't for gamers?! Why in the blazes is everyone putting fictitious words into my mouth?!? Yes, you can make the same argument, about all platforms.

I'll concede that you didn't say Wii wasn't for gamers. Ok, let's disregard that.

Though you did say "of the existing console install base, most gamers don't want a Wii." The only reason for that is the 1 year head start for the 360. Since that launch of the Wii, it has met this criteria for success. Since launch, it has outsold the PS3 & x360 combined (25 mil to ~21 mil).

 

[patsu]

The scary thing about Wii is not its market share per se. It is mindshare, momentum and the principle that (games >> graphics). It launched a year later than 360, has no price drop, and still have stock out issues in many parts of the world. Market share does not reflect its true potential. It has the broadest appeal and the most ferocious growth rate compared to the other 2 consoles.

Where the gamer pie is concerned, there is certainly some dilution going on (It does not appeal as much to PS3/360 crowd). Then again, it was designed from the start *not* to appeal to these people only.

As for console success, I think it depends on individual companies' vision. They are all designed with specific audience and timeframe in mind. Until they have executed their business plans fully, it is hard to say who has failed. I feel that this generation, in a hand waving fashion, all 3 will succeed as they target different needs.

 

[blakjedi]

nintendo wii sells consoles not games... most folks with wii's only have wii sports and maybe paper mario/supermario galaxy

 

[tongue_of_colicab]

nintendo wii sells consoles not games... most folks with wii's only have wii sports and maybe paper mario/supermario galaxy

Not totally true.