The Rise of Costs, the Fall of Gaming

[Bigduo209]

The Rise of Costs, the Fall of Gaming
http://www.notenoughshaders.com/2012/07/02/the-rise-of-costs-the-fall-of-gaming/

How do feel about the future of gaming and the rising costs associated with it?

 

[Nesh]

The Rise of Costs, the Fall of Gaming
http://www.notenoughshaders.com/2012/07/02/the-rise-of-costs-the-fall-of-gaming/

How do feel about the future of gaming and the rising costs associated with it?

I see an issue unless the industry begins to have seriously sophisticated companies that will focus solely on advanced flexible game engines and flexible art assets with which will supply devs to cut back costs and R&D.


Edit: or another probable solution is for each company to focus on low budget games and when it comes to high budget games, multiple companies should probably reduce risk by sharing costs and develop the big project together. That way smaller groups per company will be involved in a big project while freeing others to focus on low budget low risk titles.

Some profits will be generated by multiple smaller projects for each company but if a big project generates lots of losses, by sharing them, theywill not necessary offset the total operating profits because they produce other sources of income concurrently. Currently devs focus too much of their own manpower on long term high risk long lasting, cost generating projects with not enough new products released during that time frame to bring them full margin.

I say share risk and costs on big budget titles and produce more fun lower cost titles during the project's development cycle

 

[tuna]

If you spend shitloads of money making crappy games, you will lose money! I feel pretty good about that!

 

[Nesh]

If you spend shitloads of money making crappy games, you will lose money! I feel pretty good about that!

You dont know a game is crappy until its out there. Also good titles dont guarantee high profits if any profit at all as costs rise. One failure could bring one company that produced lots of great games to its demise.

 

[tuna]

You dont know a game is crappy until its out there. Also good titles dont guarantee high profits if any profit at all as costs rise. One failure could bring one company that produced lots of great games to its demise.

I do not see how this differs from any other industry.

 

[Shifty Geezer]

You dont know a game is crappy until its out there.

A designer who doesn't know their design is crappy isn't very good at their job. They may not know if their product will resonate with the consumers or may not appreciate the competition etc., but there's no excuse for crappy games (DnD: Daggerfall, I'm looking at you). Crap games should get shelved early on enough. It happens in all creative industries, where bad products are identified cand canned, and it's bad management to let weak products go all the way through to completion and release.

 

[Squilliam]

The article also seemed a little slanted in that it seemed to be almost a Wii U development advertisement. What I don't personally understand is why they seemed to imply for instance that if say 500 people worked on Assassins Creed 2, they worked on it full time. Whilst the article likely has a point it seems a bit too skewed.

 

[Scott_Arm]

Seemed to be a pretty well-written piece. I have to agree with the overall sentiment, that these studios need to stop chasing the AAA blockbuster or they will die. There will be some successful blockbuster games, but smaller focussed titles is the way of the future. A lot of this gens best games were downloadable titles from Arcade and PSN, and making those kinds of games is not nearly as risky financially.

I don't think the market is going to grow next gen. You'll probably have roughly the same number of consoles sold as you did this gen, so increasing production budgets is basically a recipe for failure.

 

[ERP]

I recently saw some figures, which I'm going to misquote because my memory sucks but ...

If you remove the Wii from the equation, and DS sales which are massively down, Console game sales are actually higher now that they were at any point in the last generation.

However the more interesting note is how few games dominate the bulk of the market, and his is where my figures are likely wrong
In the last generation the top 20 games accounted for 40% of the market, in this generation it's more like 80%.
Now I wasn't paying attention when this was presented, so it could have been franchises, and might not have been 20, but the point was that the market is more and more hit driven.
As a publisher you're making a play for that small number of games at the top, or you're fighting over 20% of the market...

 

[Scott_Arm]

It'll also be interesting to see how they manage to transition into next-gen. How many next-gen consoles would have to sell in the first year to make a $50 - 100 million game financially viable?

EA must be so happy they have their sports branch. Madden, FIFA, NHL and NBA are all pretty predictable sellers (I think), and probably fairly cheap to make with their iterative approach to development.

 

[Nesh]

I do not see how this differs from any other industry.

We arent discussing how much it differs from any other industry, are we?

 

[Nesh]

A designer who doesn't know their design is crappy isn't very good at their job. They may not know if their product will resonate with the consumers or may not appreciate the competition etc., but there's no excuse for crappy games (DnD: Daggerfall, I'm looking at you). Crap games should get shelved early on enough. It happens in all creative industries, where bad products are identified cand canned, and it's bad management to let weak products go all the way through to completion and release.

I agree that some games are apparent that they are crappy(I am looking at you DMC2) but i disagree that every game is apparent before release. It also depends by your definition of crap. FF13 for me as a consumer for example was a crappy FF in the series. But I doubt as a developer I would have been sure about it before release. There are also gems that the consumer dont recognize, works of art such us Okami and Viewtiful Joe. Amazing games which as a designer see the splendor and great work, but doesnt know if the consumer will like the work until it hits shelves.

 

[Shifty Geezer]

There are also gems that the consumer dont recognize, works of art such us Okami and Viewtiful Joe.

Yeah, but those aren't crappy games. I think you were using the term to mean 'will sell crappy'. That's not very predictable, but I think those in the industry can be a bit blinkered at times. Certainly there are games produced as 'triple A' which, IMO, are obviously not going to perform as AAA top sellers. And a lot of games having money thrown at them shows a business that really doesn't get what it's all about. Hollywood covers films across a massive range of production costs. We now have more production options for console games, so the publishers should be spreading their investments across a wider range. Evaluate an idea as mid-tier, cheapie, and blockbuster, and fund accordingly, evaluation development as it progresses and being willing to move the game's retail position and investment accordingly.

 

[Nesh]

We now have more production options for console games, so the publishers should be spreading their investments across a wider range. Evaluate an idea as mid-tier, cheapie, and blockbuster, and fund accordingly, evaluation development as it progresses and being willing to move the game's retail position and investment accordingly.

I think they are already doing that but the industry forces the big companies such as high competition to invest also on high budget titles which are risky by nature due to the complexity and rising costs. At some point costs will be so high for a single high budget quality title that there will be no best business model other than relying completely on low budget games.

Because everyone is afraid that one large dev company will come up with a high profile game that will eat up sales (which are almost always the million top sellers in charts) and demolish them, all the big players do it even though million sellers dont always brake even, and the small cant even compete. Because they supply the market with many high profile high cost risky projects, they all need higher sales per generation while the pie unfortunately is not enough for everyone

Its a business model they dont want to follow but follow it in fear of competition that may take advantage of the opportunity

They are leading each other to a tighter leash every gen, until something changes the course of the industry as a means to survive, or they change their business models altogether.

In the 80s bad quality games led to the videogame industry crash. Now it will be the strive towards high profile, quality games due to fierce competition and growing costs, while the market interested for these games doesnt grow as much to support them

 

[Scott_Arm]

Maybe there will be a new effort put into episodic gaming. Valve had trouble with it, but Valve is SLOOOOW. If your first episode doesn't pperform, you cut your losses.

 

[Shifty Geezer]

I think they are already doing that but the industry forces the big companies such as high competition to invest also on high budget titles which are risky by nature due to the complexity and rising costs. At some point costs will be so high for a single high budget quality title that there will be no best business model other than relying completely on low budget games.

I'm sure this discussion has been had before in a TheChefO thread, but I'm just posting quickly. There's been a shocking lack of progressive development IMO. That is, you float an idea in a simple form as a download, guage interest, and then build on it. eg. Kingdoms of Amalur. That could have been started as a simple dungeon crawler in a download title. If it's well received, roll out some upgrades and then start into a full-sized disc title. If that does well, start into the MMO while developing KOA2. Download titles have given us a chance to test ideas out without having to invest in a full-priced experience, and most importantly to get market feedback.

Or as Scott says, turn development into something more episodic. A typical game progresses along levels. These assets could be created at various intervals, giving financial support the games development instead of needing the full investment up front.

Or even run companion games that generate revenue, like a Halo tactical top-down squad game or something. The sort of thing that gets churned out on tablets but could work fine on consoles only they're being avoided.

Publishers just aren't keeping up with the options and are losing money as a result, IMHO.

 

[Arwin]

Agreed. I'm pleased to see stuff like iOS and Kickstarter as some of the areas where things are being stirred up.

 

[Squilliam]

I suspect a major problem is that they are often trying to make the same game as other companies. How do you differentiate shooter #5 outside of trying to outspend/keep up with the spending on other titles and then hoping you're lucky and people jump on board your title over other titles?

 

[Scott_Arm]

I'm sure this discussion has been had before in a TheChefO thread, but I'm just posting quickly. There's been a shocking lack of progressive development IMO. That is, you float an idea in a simple form as a download, guage interest, and then build on it. eg. Kingdoms of Amalur. That could have been started as a simple dungeon crawler in a download title. If it's well received, roll out some upgrades and then start into a full-sized disc title. If that does well, start into the MMO while developing KOA2. Download titles have given us a chance to test ideas out without having to invest in a full-priced experience, and most importantly to get market feedback.

Or as Scott says, turn development into something more episodic. A typical game progresses along levels. These assets could be created at various intervals, giving financial support the games development instead of needing the full investment up front.

Or even run companion games that generate revenue, like a Halo tactical top-down squad game or something. The sort of thing that gets churned out on tablets but could work fine on consoles only they're being avoided.

Publishers just aren't keeping up with the options and are losing money as a result, IMHO.

Launching with a small downloadable title to test a concept sounds like a good approach too. Why not release a cheap game that tests a mechanic or idea to see if it works, and then trod into a full-scale title if it turns out to be popular. I suppose there's worry that someone else will see your idea and beat you to the punch in making something bigger out of it.

Either way, developers need to do something like that, or episodic games, to make sure an idea is a good investment, and give themselves a way to minimize their financial risk.

 

[RudeCurve]

One concern about these "consumer feedback" ideas is how do you filter out the "fake hand waving" from the genuine potential buyers? This happens a lot on car forums where lots of people say they want this and that from a car, but then when a car company makes a car with those things they don't end up buying the car so the car company doesn't make money from these people.

I think there should be some way to let consumers invest in the game development process so that the developer isn't left hanging with an idea that doesn't sell.