Over the last few years, competitive gaming has made huge strides, building a massive fanbase, supporting the rise of entire genres of games and attracting vast prize pots for the discipline’s very best. Almost across the board, the phenomenon has also seen its revenues gaining, as new sponsors come on board, including some major household names. Sustaining the rapidity of the growth of eSports is going to be key to its long term success, maintaining momentum and pushing it ever further into the public consciousness.
In order to do that, according to Newzoo, eSports need to learn some lessons from their more traditional athletic counterparts. Right now, the research firm puts a pin in eSports revenues of $2.40 per enthusiast per year, a number which is expected to bring the total revenue for the industry to $275 million for 2015 – a 43 per cent increase on last year. By 2018, the firm expects that per user number to almost double, reaching $4.63.
That’s a decent number, representing very rapid growth, but it pales in comparison to Newzoo’s estimates on the average earning per fan for a sport like Basketball, which represents a $14 per fan revenue – rising to $19 where only the major league NBA is a factor. To catch up to numbers like this is going to take some time, but Newzoo’s research has listed five factors it considers vital to achieving that aim.
Right now, MOBAs are undeniably the king of the eSports scene, and one of the biggest genres in gaming. The king of MOBAs, League of Legends, is the highest earning game in the world, whilst others like Valve’s DOTA 2 are also represent huge audiences and revenues, including the prestigious annual International tournament. Shooters are also still big business here, with Activision Blizzard recently announcing the formation of a new Call of Duty League.
Nonetheless, MOBAs are still the mainstay and if you don’t like them, you’re not going to get too deeply into competitive gaming as a fan. Although their popularity with the athletes is going to make them a difficult genre to shift, Newzoo says that broadening the slate is a key factor to growth.
The major tournaments bring players, and audiences, from all over the world, but it’s often only the very top tier of players who can find themselves a foothold in regular competition. Major territories like the US, South Korea and Europe have some local structure, but again League of Legends stands almost alone in its provision of local infrastructure. By expanding a network of regular leagues and competitions to more countries, eSports stands a much better chance of building a grassroots movement and capturing more fans.
Already a problem very much on the radar of official bodies and players around the world, the introduction of regulation is always a tough transition for any industry. However, when you’re putting up millions of dollars in prize money, you can’t have any grey areas around doping, match fixing and player behaviour at events. These young players are frequently thrust into a very rapid acceleration of lifestyle, fame and responsibility – a heady mixture which can prove to be a damaging influence on many. Just like in other sports, stars need protecting and nurturing – and the competitions careful monitoring – in order for growth to occur without scandal and harm to its stars.
Dishing out the rights to broadcast, promote and profit from eSports is a complex issue. Whilst games like football are worldwide concerns, with media rights a hotly contested and constantly shifting field, nobody owns the games themselves. With eSports, every single aspect of the games being played is a trademark in itself, with its owners understandably keen to protect them. However, with fan promotion such a key part of the sport’s growth, and services like Twitch a massive factor in organic promotion, governing the rights of distribution is only going to become a murkier and more complex business as time goes on. With major TV networks, well used to exclusivity, now starting to show an interest, expect this to become a hot topic.
Conflict between new and old media
That clash of worlds, between the fresh and agile formats of digital user-sourced broadcasting and the old network model is also going to be source of many of its own problems. One or the other, or even both, is going to have to adapt fast for there to be a convivial agreement which betters the industry as a whole. There’s currently considerable pushback from established media against the idea of eSports becoming accepted as a mainstream activity, fuelled in no small part by their audiences themselves, so a lo of attitudes need to change. Add to that the links between these media giants and many of the world’s richest advertisers and you can start to see the problem.
The PlayStation business has had another phenomenal quarter in the first four months of 2015, selling three million PS4 units and turning in an operating income of $160 million from revenues of $2.365 billion. There are now 25.3 million PlayStation 4 units in the hands of players worldwide – a number achieved in less than two full years.
The console continues to be the company’s fastest seller – outpacing the PS2, which took two years and eight months to reach the 20 million mark. Furthermore, thanks to dropping production costs for PS4 hardware, a 12 per cent increase in sales from the same quarter last year translated to a massive 350 per cent rise in operating income.
A strengthening dollar again hurt Sony’s bottom line, having an estimated impact of 15.6 billion Yen on the revenue total of 288.6 billion Yen, but this was massively outweighed by the increase in sales and the efficiency gains of Sony’s operation. On the strength of the results, Sony has added another 20 billion Yen in operating income to the sector’s full year forecast.
The sales rate of PS4 shows a healthily steady growth in player base, returning to a gradual upswing after a huge blip in Q3, 2014. Sony has upgraded it full year forecast from 16 million units to 16.5 as a result – a figure which would show a substantial increase on 2014′s 14.8 million total. By Sony’s own reckoning, the end of Q1 2016 will see nigh on 40 million of the consoles in homes. Vita sales once again went unmentioned in the report, whilst the gradual decline of PS3 continued.
Hardware wasn’t the only success story. Network, (“Network includes network services relating to game, video, and music content provided by Sony Network Entertainment Inc.”) mad almost as much in revenues, netting around 105.8 billion Yen compared to Hardware’s 129.5 billion. The Other category (Other includes packaged software and peripheral devices) brought in 30.6 billion.
Overall, the corporation turned a healthy profit, banking $676 million in net from sales of nearly $15 billion. Whilst the PlayStation business is very healthy indeed, it’s far from Sony’s only, or even biggest, success story: Devices, Imaging, Financial Services and Music all continue to return a higher operating income.
At Sony’s 2015 Investor Relations Day today, Sony Computer Entertainment president and global CEO Andrew House detailed the company’s strategy for the coming year, including how it will address some shortcomings.
House began his presentation on a positive note, talking up PlayStation 4 as “the fastest selling hardware platform in our history,” showing better-than expected growth and pushing PlayStation Plus subscriptions to twice what they were in fiscal year 2013. He said the company has a competitive advantage for the moment, and laid out three ways it hopes to maintain that. In addition to next year’s launch of the Project Morpheus virtual reality headset and continued cost reduction efforts, House said the company needs quality software.
“We are working very hard to continue very strong support from third-party pubs and devs,” House said. “Our first-party lineup is a little sparse this year, so I think this places even greater emphasis on getting good third-party support.”
That doesn’t necessarily mean exclusive third-party support. To date, House said Sony has been primarily trying to get multiplatform developers to simply take advantage of features the PS4 has over the competition, like SharePlay, or maybe include extra content in the PS4 version or give players early access to add-on content. Third-party exclusives are still an option, just not a frequently used one.
“I will admit that these are, in the current publishing landscape, few and far between, but we were able to announce a full exclusive around a franchise like Street Fighter so that Street Fighter 5 is a complete exclusive for PlayStation 4,” House said, adding, “Although given publishing dynamics and development costs, those are increasingly difficult to secure.”
House also talked about the decline in Sony’s other platforms. As much as the PS4′s growth has exceeded expectations, so too has the PlayStation 3′s decline. House said the system’s price simply isn’t as competitive in the market as the PlayStation 2 and PSone were after their successors launched, and added that the shift toward more connected console experiences has also made less capable offerings less attractive.
House also cast a dim view of the company’s handheld business. While he noted that the Vita platform remains “strong and vibrant” in Asia and Japan, his outlook for the current fiscal year included declines in the US and Europe. Additionally, he referred to the PlayStation Vita and its microconsole counterpart the PlayStation TV as “legacy platforms” when discussing a write-off of hardware components for the two.
“I would characterize 2015 as the beginning of a harvest period for the PlayStation 4 platform,” House said. “The beginning of a harvest period. That being said, we are also undertaking to invest in the future, and 2015 will also be a year of investment.”
That investment will be focused on a few areas. There’s the Morpheus, of course, as well as continued spend on original PlayStation entertainment content like the TV show Powers (which was recently greenlit for a second season). On top of that, House said Sony would be investing in the expansion of its PlayStation Vue television streaming platform and a continued re-architecture of its PlayStation Network with an eye toward increasing stability and reducing maintenance downtime.
Hackers from Brazil have managed to discover a new exploit for the PS4 which enables them to bypass the DRM on any software and games.
A couple of weeks ago, a number of electronic stores in Brazil had been advertising the means to copy and run a series of ripped retail games on the console.
At the time little was known about the hack back then, but information gradually began to trickle out from customers and make its way around the web. Please see below for commentary from Lancope.
Gavin Reid, VP of threat intelligence, Lancope said that Sony was playing an arms race against groups that benefit from the abilities to copy and share games.
The hack originates from a Russian website and has been pushed into the public by Brasilian retailers. The hack isn’t necessarily a jailbreak for the PS4, nor is it really a homebrew technique.
What they did was use a retail PS4, with several games installed on it, with it’s entire game database and operating system (including NAN/BIOS). This was then dumped onto a hacked PS4 via Raspberry Pi.
The entire process costs about $100 to $150 to install 10 games and $15 per additional game.
“Open source groups like Homebrew with more altruistic motivations of extending the functionality of the console alongside groups selling modified consoles specifically to play copied games and of course the resell of the games themselves at fraction of the actuals costs. This has happened historically with all of the major consoles. It would be highly unlikely not to continue with the PS4,” he said.
The deal that helped Crytek recover from its recent financial difficulties was Amazon, according to a report from Kotaku.
The online retail giant signed a licensing deal for CryEngine, Crytek’s proprietary game engine. Sources within the company put the deal’s value at between $50 million and $70 million, and suggested that Amazon may be using it as the bedrock for a proprietary engine of its own.
However Amazon uses the technology, though, the importance of the deal for Crytek cannot be overstated. Last year, during the summer, it became apparent that all was not well at the German developer. Employees hadn’t been fully paid in months, leading to an alleged staff walkout in its UK office, where a sequel to Homefront was in development. Koch Media acquired the Homefront IP and its team shortly after.
When the company’s management eventually addressed the rumors, it had already secured the financing necessary to take the company forward. No details of the deal were offered, but it’s very likely that Crytek got the money it needed from Amazon.
We have contacted Crytek to confirm the details, but it certainly fits with the perception that Amazon could emerge as a major creator of game content. It has snapped up some elite talent to do just that, it acquired Twitch for a huge sum of money, and it has been very open about where it plans to fit into the overall market.
Over the last few years, the industry has seen budget polarization on an enormous scale. The cost of AAA development has ballooned, and continues to do so, pricing out all but the biggest warchests, while the indie and mobile explosions are rapidly approaching the point of inevitable over-saturation and consequential contraction. Stories about the plight of mid-tier studios are ten-a-penny, with the gravestones of some notable players lining the way.
For a company like Ninja Theory, in many ways the archetypal mid-tier developer, survival has been a paramount concern. Pumping out great games (Ninja Theory has a collective Metacritic average of 75) isn’t always enough. Revitalizing a popular IP like DMC isn’t always enough. Working on lucrative and successful external IP like Disney Infinity isn’t always enough. When the fence between indie and blockbuster gets thinner and thinner, it becomes ever harder to balance upon.
Last year, Ninja Theory took one more shot at the upper echelons. For months the studio had worked on a big budget concept which would sit comfortably alongside the top-level, cross-platform releases of the age: a massive, multiplayer sci-fi title that would take thousands of combined, collaborative hours to exhaust. Procedurally generated missions and an extensive DLC structure would ensure longevity and engagement. Concept art and pre-vis trailers in place, the team went looking for funding. Razor was on its way.
Except the game never quite made it. Funding failed to materialize, and no publisher would take the project on. It didn’t help that the search for a publishing deal arrived almost simultaneously with the public announcement of Destiny. Facing an impossible task, the team abandoned the project and moved on with other ideas. Razor joined a surprisingly large pile of games that never make it past the concept stage.
Sadly, it’s not a new story. In fact, at the time, it wasn’t even a news story. But this time Ninja Theory’s reaction was different. This was a learning experience, and learning experiences should be shared. Team lead and co-founder Tameem Antoniades turned the disappointment not just into a lesson, but a new company ethos: involve your audience at an early stage, retain control, fund yourself, aim high, and don’t compromise. The concept of the Independent AAA Proposition, enshrined in a GDC presentation give by Antoniades, was born.
Now the team has a new flagship prospect, cemented in this fresh foundation. In keeping with the theme of open development and transparency, Hellblade is being created with the doors to its development held wide open, with community and industry alike invited to bear witness to the minutiae of the process. Hellblade will be a cross-platform game with all of the ambition for which Ninja Theory is known, and yet it is coming from an entirely independent standpoint. Self-published and self-governed, Hellblade is the blueprint for Ninja Theory’s future.
“We found ourselves as being one of those studios that’s in the ‘squeezed middle’,” project lead Dominic Matthews says. “We’re about 100 people, so we kind of fall into that space where we could try to really diversify and work on loads of smaller projects, but indie studios really have an advantage over us, because they can do things with far lower overheads. We have been faced with this choice of, do we go really, really big with our games and become the studio that is 300 people or even higher than that, and try to tick all of these boxes that the blockbuster AAA games need now.
“We don’t really want to do that. We tried to do that. When we pitched Razor, which we pitched to big studios, that ultimately didn’t go anywhere. That was going to be a huge game; a huge game with a service that would go on for years and would be a huge, multiplayer experience. Although I’m sure it would have been really cool to make that, it kind of showed to us that we’re not right to try to make those kinds of games. Games like Enslaved – trying to get a game like that signed now would be impossible. The way that it was signed, there would be too much pressure for it to be…to have the whole feature set that justifies a $60 price-tag.
“That $60 price-tag means games have to add multiplayer, and 40 hours of gameplay minimum, and a set of characters that appeal to as many people as they possibly can. There’s nothing wrong with games that do that. There’s some fantastic games that do, AAA games. Though we do think that there’s another space that sits in-between. I think a lot of indie games are super, super creative, but they can be heavily stylised. They work within the context of the resources that people have.
“We want to create a game that’s like Enslaved, or like DMC, or like Heavenly Sword. That kind of third-person, really high quality action game, but make it work in an independent model.”
Cutting out the middle-man is a key part of the strategy. But if dealing with the multinational machinery of ‘big pubs’ is what drove Ninja Theory to make such widespread changes, there must surly have been some particularly heinous deals that pushed it over the edge?
“I think it’s just a reality of the way that those publisher/developer deals work,” Matthews says. “In order for a publisher to take a gamble on your game and on your idea, you have to give up a lot. That includes the IP rights. It’s just the realities of how things work in that space. For us, I think any developer would say the same thing, being able to retain your IP is a really important thing. So far, we haven’t been out to do that.
“With Hellblade, it’s really nice that we can be comfortable in the fact that we’re not trying to appeal to everyone. We’re not trying to hit unrealistic forecasts. Ultimately, I think a lot of games have unrealistic forecasts. Everyone knows that they’re unrealistic, but they have to have these unrealistic forecasts to justify the investment that’s going into development.
“Ultimately, a lot of games, on paper, fail because they don’t hit those forecasts. Then the studios and the people that made those games, they don’t get the chance to make any more. It’s an incredibly tough market. Yes, we’ve enjoyed working with our publishers, but that’s not to say that the agreements that developed are all ideal, because they’re not. The catalyst to us now being able to do this is really difficult distribution. We can break away from that retail $60 model, where every single game has to be priced that way, regardless of what it is.
Driven into funding only games that will comfortably shift five or six million units, Matthews believes that publishers have no choice but to stick to the safe bets, a path that eventually winnows down diversity to the point of stagnation, where only a few successful genres ever end up getting made: FPS, sports, RPG, maybe racing. Those genres become less and less distinct, while simultaneously shoe-horning in mechanics that prove popular elsewhere and shunning true innovation.
While perhaps briefly sustainable, Matthews sees that as a creative cul-de-sac. Customers, he feels, are too smart to put up with it.
“Consumers are going to get a bit wary of games that have hundreds of millions of dollars spent on them”
“I think consumers are going to get a bit wary. Get a bit wary of games that have hundreds of millions of dollars spent on them. I think gamers are going to start saying, ‘For what?’
“The pressures are for games to appeal to more and more people. It used to be if you sold a million units, then that was OK. Then it was three million units. Now it’s five million units. Five million units is crazy. We’ve never sold five million units.”
It’s not just consumers who are getting wise, though. Matthews acknowledges that the publishers also see the dead-end approaching.
“I think something has to be said for the platform holders now. Along with digital distribution, the fact that the platform holders are really opening their doors and encouraging self-publishing and helping independent developers to take on some of those publishing responsibilities, has changed things for us. I think it will change things for a lot of other developers. “Hellblade was announced at the GamesCom Playstation 4 press conference. My perception of that press conference was that the real big hitters in that were all independent titles. It’s great that the platform holders have recognised that. There’s a real appetite from their players for innovative, creative games.
“It’s a great opportunity for us to try to do things differently. Like on Hellblade, we’re questioning everything that we do. Not just on development, but also how we do things from a business perspective as well. Normally you would say, ‘Well, you involve these types of agencies, get these people involved in this, and a website will take this long to create.’ The next thing that we’re doing is, we’re saying, ‘Well, is that true? Can we try and do these things a different way,’ because you can.
“There’s definitely pressure for us to fill all those gaps left by a publisher, but it’s a great challenge for us to step up to. Ultimately, we have to transition into a publisher. That’s going to happen at some point, if we want to publish our own games.”
While the Sony PlayStation 4 has been selling very well, it seems that Christmas was not really its season.
Sony said that the PlayStation 4 has sold more than 18.5 million units since the new generation of consoles launched. While that is good and makes the PS4 the fastest selling PlayStation to date, there was no peaking at Christmas.
You would think that the PS4 would sell well at Christmas as parents were forced to do grevious bodily harm to their credit cards to shut their spoilt spawn up during the school holidays. But apparently not.
Apparently, the weapon of choice against precious snowflakes being bored was an Xbox One which saw a Christmas spike in sales.
Sony said that its new numbers are pretty much on target, it sold the expected 2 million sales per month rate.
Redmond will be happy with that result even if it still has a long way to go before it matches the PlayStation 4 on sales.
For independent developers, the last decade has been an endless procession of migratory possibilities. The physical world was defined by compromise, dependence and strategically closed doors, but the rise of digital afforded freedom and flexibility in every direction. New platforms, new business models, new methods of distribution and communication; so many fresh options appeared in such a brief window of time that knowing where and when to place your bet was almost as important as having the best product. For a few years, right around 2008, there was promise almost everywhere you looked.
That has changed. No matter how pregnant with potential they once seemed, virtually every marketplace has proved unable to support the spiralling number of new releases. If the digital world is one with infinite shelf-space for games, it has offered no easy solutions on how to make them visible. Facebook, Android, iOS, Xbox Live Arcade, the PlayStation Network; all have proved to be less democratic than they first appeared, their inevitable flaws exposed as the weight of choice became heavier and heavier. As Spil Games’ Eric Goossens explained to me at the very start of 2014: “It just doesn’t pay the bills any more.”
Of course, Goossens was talking specifically about indie development of casual games. And at that point, with 2013 only just receding from view, I would probably have named one exception to the trend, one place where the balance between volume and visibility gave indies the chance to do unique and personal work and still make a decent living. That place would have been Steam, and if I was correct in my assessment for even one second, it wasn’t too long before the harsher reality became clear.
After less than five months of 2014 had passed, Valve’s platform had already added more new games than in the whole of the previous year. Initiatives like Greenlight and Early Access were designed to make Steam a more open and accessible platform, but they were so effective that some of what made it such a positive force for indies was lost in the process. Steam’s culture of deep-discounting has become more pervasive and intense in the face of this chronic overcrowding, stirring up impassioned debate over what some believe will be profound long-term effects for the perceived value of PC games. Every discussion needs balance, but in this case the back-and-forth seemed purely academic: for a lot of developers steep discounts are simply a matter of survival, and precious few could even entertain the notion of focusing on the greater good instead.
And the indie pinch was felt beyond Steam’s deliberately weakened walls. Kickstarter may be a relatively new phenomenon – even for the hyper-evolving landscape of the games industry – but it faced similar problems in 2014, blighted by the twin spectres of too much content and not enough money to go around. Anecdotally, the notion that something had changed was lurking in the back ground at the very start of the year, with several notable figures struggling to find enough backers within the crowd. The latter months of 2014 threw up a few more examples, but they also brought something close to hard evidence that ‘peak Kickstarter’ may already be behind us – fewer successful projects, lower funding targets, and less money flowing through the system in general. None of which was helped by a handful of disappointing failures, each one a blow for the public’s already flagging interest in crowdfunding. Yet another promising road for indies had become more treacherous and uncertain.
So are indies heading towards a “mass extinction event”? Overcrowding is certainly a key aspect of the overall picture, but the act of making and releasing a game is only getting easier, and the allure of development as a career choice seems to grow with each passing month. It stands to reason that there will continue to be a huge number of games jostling for position on every single platform – more than even a growing market can sustain – but there’s only so much to be gained from griping about the few remaining gatekeepers. If the days when simply being on Steam or Kickstarter made a commercial difference are gone, and if existing discovery tools still lack the nuance to deal with all of that choice, then it just shifts the focus back to where it really belongs: talent, originality, and a product worth an investment of time and money.
At GDC Europe this summer, I was involved in a private meeting with a group of Dutch independent game developers, all sharing knowledge and perspective on how to find success. We finished that hour agreeing on much the same thing. There are few guarantees in this or any other business, but the conditions have also never been more appropriate for personality and individuality to be the smartest commercial strategy. The world has a preponderance of puzzle-platformers, but there’s only one Monument Valley. We’re drowning in games about combat, but This War of Mine took a small step to the left and was greeted with every kind of success. Hell, Lucas Pope made an entire game about working as a border control officer and walked away with not just a hit, but a mantelpiece teeming with the highest honours.
No matter how crowded the market has become, strong ideas executed with care are still able to rise above the clamour, no huge marketing spend required. As long as that’s still possible, indies have all of the control they need.
The group had published a list of emails and passwords for PSN, Windows Live Mail and 2K Games accounts online, and claimed to be prepared to release more, but Sony says that they’ve come from other sources than hacking.
“We have investigated the claims that our network was breached and have found no evidence that there was any intrusion into our network,” the company wrote in a declaration to Joystiq. “Unfortunately, Internet fraud including phishing and password matching are realities that consumers and online networks face on a regular basis. We take these reports very seriously and will continue to monitor our network closely.”
Blizzard is happy and why shouldn’t they be as World of Warcraft subscriptions are up. The reason for the increase can be traced to the release of the latest expansion pack which was recently released. The latest WOW expansion pack is called Warlords of Draeno and its release has driven subscriptions to 10 million.
Selling over 3.3 million copies of the Warlords of Draenor on the first day alone, growth has been seen in all major territories since release. The numbers do include those players that are using the 1 month free subscription that comes with the expansion pack. WoW subscriptions had climbed to 7.4 million last quarter after being down.
Of course the release of Warlords of Draenor has not been without its problems. Still Blizzard says that they are working around the clock to address them. Owners have been offered free play time as compensation.
Sources are telling us that we should expect new skateboarding titles from both Electronic Arts and Activision in 2015. Word is that Activision is preparing a new Tony Hawk title and Electronic Arts will be bring out a new Skate title as well.
While Activision and Electronic Arts have not made the announcements yet, our sources tell us that we should expect both titles to be announced in the near future for a likely late 2015 release. It is unknown who might be handling the development on both titles, but word is that both titles are already deep in development.
With the release of a new Tony Hawk and Skate titles, it will revive the Skateboarding segment that has been dormant for quite some time. EA has not produced a new title in the Skate franchise since Skate 3 and the late couple of Tony Hawk titles didn’t do so well, but the re-issue of original Pro Skater for the Xbox 360 and PlayStation 3 with DLC made up of levels from 2 & 3 have shown that interest does still exist for this segment.
Our hope is that it will be less like what we saw with the SSX revival that EA tried and then realized that it was not really want the people wanted and more like a new next-generation skateboarding title that puts the fun back into skating. We will have to wait and see.
While Grand Theft Auto may remain the industry’s true juggernaut, pretty much the only single franchise whose launch is capable of spiking software sales figures for an entire year and pushing all rivals out of the field in the process, Call of Duty has become the industry’s banner carrier in a different way. GTA’s extraordinary launches are such enormous events precisely because Rockstar wisely chose to avoid the annual update treadmill with the game; Call of Duty, meanwhile, has managed to continue a steady streak of enormous launches despite the punishing requirements of such a schedule.
It’s hard to overstate just how important this difference in approach is to a game franchise. GTA’s main instalments are all developed by the same studio, Rockstar North, meaning that each subsequent game begins its lengthy gestation after the launch of the previous title. The result is that the ball is rarely if ever dropped in terms of quality; no untested team gets to mess things up in an “off-year”. Each new GTA game follows a clear evolutionary path from the previous game, as the studio learns and develops its approach; a major advantage over the “three steps forward, two steps back” games that result from an annual update cycle with different teams working on different schedules. Finally, GTA’s spaced out launches give each one the sense of being a genuinely enormous event, and the games continue to sell at a solid price point for many months after launch, a feat which is otherwise only achieved in this industry by Nintendo’s key titles.
“The sheer scale of GTA’s success has made it into an unbalancing factor in the publisher’s figures”
Again, this contrasts with the annual update cycle for games like Call of Duty; on a couple of occasions, new CoD games have arguably truncated the sales of their predecessors when they launched. All of these benefits, however, are outweighed by the big problem with such an irregular launch cycle, namely that it plays merry hell with Take Two’s financial performance. The sheer scale of GTA’s success has made it into an unbalancing factor in the publisher’s figures; it means that from the perspective of the markets, everything else Take Two does is relegated to being a “snack between GTAs”. The “snack” quarters in the company’s financials are by no means bad, but they end up being compared, desperately unfairly, to the GTA quarters, and analysts fret endlessly over whether the company is a one-trick pony and how far down the tubes it will go if GTA ever falters. Of course, annual updates also make more money – in the short term, arguably; GTA may be genuinely evergreen due to its slow update cycle, where annually updated games, apart from sports titles, tend inevitably to lose steam). But even if they didn’t, it’s hard to imagine a company like Activision risking a “spiky” set of financial results. Huge companies don’t just want to make more money; they want to make more money in a predictable way, with a nice growth curve and no nasty dips that make shareholders lose confidence.
Thus we end up with the situation now facing the Call of Duty franchise. We’re a long day from the heady days of Infinity Ward’s groundbreaking CoD 4: Modern Warfare. As of this year, there are now three separate studios working on the franchise, with the instalment that launched this week, Call of Duty: Advanced Warfare (“CODAW”, which is fun to say but not remotely as fun as “CODBLOPS” was a few years back) being the first full game in the franchise from Sledgehammer. This is one interesting approach to keeping the quality of the games high in spite of the annual treadmill; the other key approach being employed by Activision is to throw money at the franchise like confetti at a particularly exuberant wedding, with CODAW’s most eye-opening use of cash being the suitcases full of it which were presumably delivered to Kevin Spacey’s door in order to persuade him to dress up in a motion capture gimp suit and deliver a villainous performance that’s at times delightfully Frank Underwood but all too often disappointingly Lex Luthor.
Keeping the quality bar high is an extraordinarily important task for Activision – be it through giving studios the time they need to genuinely polish their franchise instalments, or hiring famous faces to do their best with the games’ B-movie scripts (seriously, CODAW’s singleplayer campaign was apparently written by a 15 year old off his tits on Mountain Dew and Doritos who had just watched Michael Bay’s Transformers movies back-to-back and emerged with the sole complaint that “there weren’t enough explosions”). Last year’s CoD: Ghosts was judged both critically and commercially as a slip for the series, which may be partially responsible for the lower pre-orders for this year’s instalment which have been tracked by many analysts.
This year’s game has had great critical response thus far, so it represents an important test – given that the quality bar has arguably been returned to a solid level (it’s all subjective, of course, but the overall tenor of the coverage is positive), will sales also get back to an even keel? Or was CoD Ghosts’ weak commercial showing the start of a slide for the series which can only be reversed by a truly radical reinvention? Consumer fatigue, after all, is absolutely a real thing. It’s even tougher for games that for movies; the Marvel Cinematic Universe movies could probably continue for many years to come, since they only ask consumers for a couple of hours of time every few months. CoD players invest dozens upon dozens of hours in each game (in some cases, hundreds), which makes it much more likely that they’ll burn out; that at some point, they’ll reach an annual update that’s just a step too far for them. The best defence against this is keeping the franchise fresh, consistently reinvigorated with new ideas, and of course, keeping the quality bar high; but even that may not halt the slow decline
This year could go either way for COD. Pre-orders are definitely down on the previous year, which does not bode well, but that doesn’t take into account digital pre-orders – and it’s worth noting that on the new-gen consoles there appears to be a very strong trend towards digital pre-orders and first week digital purchases. Activision claims that purchase intent is tracking high, although that’s Schrödinger’s Statistic to a large extent – you don’t know for sure if it’s remotely accurate or not until you open the box with the sales figures inside.
Still, all in all there are some reasons to be There are also reasons to be cautiously pessimistic. One of the biggest problems facing COD this year is, oddly, one of Activision’s own successes – Destiny, which has attracted and continues to enthral a very large number of the core FPS fans who might otherwise be expected to devote themselves to CODAW. It seems plausible that the long gap between Destiny’s launch and the appearance of the first content pack, The Dark Below, is at least partially in order to give players a lull in which investing in COD will seem appealing; it will be interesting to see if that actually works.
The single biggest challenge, however, lies within COD itself. It’s a remarkably successful game and will continue to sell well for years to come, but if this year’s numbers can’t match last year’s (even in spite of much more positive critical reception and consumer word-of-mouth), it will be taken as clear evidence that a peak has been passed. Consumer fatigue, high competition and perhaps a lingering sense of being burned by Ghosts are all potentially damaging factors for the franchise this year; should they conspire to push sales down even by a few percentage points year-on-year, tough questions will have to be asked about the future of Activision’s annual cash- Indeed, in that instance, one might ask some tough questions about Activision itself.
It’s odd, perhaps, to question a company’s prospects when it has just announced record financials, but it’s entirely possible that this is a peak for the publisher. World of Warcraft is far from its peak figures, in spite of occasional bumps when expansions are launched, and Blizzard’s putative replacement, Titan, has been cancelled. Destiny has yet to prove itself as a franchise despite an amazing launch, and as I indicated last year, I’m not sure that Activision and the game’s fanbase see eye-to-eye on how it’s going to develop over the coming years. If Call of Duty also shows itself to be coming off the boil, then only Hearthstone will remain as a truly unblemished bright spot in Activision’s line-up. The markets will, no doubt, have noticed this already; Call of Duty Advanced Warfare’s performance is going to be subjected to intense scrutiny over the coming weeks and months, as analysts and investors attempt to divine Activision’s future from this crucial data point.
The internet has just received the first surge of what will be a raging tide of Call of Duty: Advanced Warfare reviews, but several key outlets will be lagging behind the others.
As is tradition by now, Activision chose to restrict press access to a fleet of new generation consoles set up in hotel rooms around the world. This has happened with pretty much every major Call of Duty release since Modern Warfare 2, but it’s only in the last year or two that disclaimers have become a common feature of the subsequent reviews. Polygon went to a review event, for example, but it paid for its writer’s accommodation. Kotaku makes no mention of any event despite having played through the entire campaign (presumably in an Xbox One bedecked hotel room), but it is nevertheless holding off publishing a scored review until it has the opportunity to play the game’s multiplayer in a live setting – “the way it was intended.”
Eurogamer took a third route, attending the review event on Activision’s dime but relaxing its critical trigger-finger until Advanced Warfare was released to the public and its true online mettle could be tested. Which is the right approach? Should a review prioritise accuracy or punctuality? No one person can provide a sensible answer to that question, but it seems that the task of the video game critic becomes thornier and more thankless with every AAA release.
One thing is roundly agreed upon, though: Call of Duty: Advanced Warfare is definitely better than Call of Duty: Ghosts, and most outlets believe that it’s an improvement on Black Ops II. Indeed, even though Eurogamer’s full review won’t be published until later this week, it was enthusiastic enough to publish a score-free recommendation of what it did have a chance to play in the meantime.
Advanced Warfare, the first full COD title from Sledgehammer Games, is, “the biggest shift for the series since the original Modern Warfare, and…easily the best entry since Modern Warfare’s ceasefire.” Here, Eurogamer argues, the series shrugs off the weighty, pained influence of films like Black Hawk Down and turns instead to science fiction romps like Star Wars and Halo, all exotic cityscapes, flying vehicles and elaborate weaponry – “Advanced Warfare impresses you with just how much fun war can be.”
Polygon is with Eurogamer in spirit, but it’s appraisal – based on a private playthrough of the campaign and closed multiplayer sessions hosted by Activision – has a 9.0 waiting at the end. This is exactly the sort of score that Activision and Sledgehammer have been working towards, and Polygon leaves little room for doubt that, this time out, Call of Duty has really earned whatever accolades it receives.
Key to it all are various “Exosuits,” which imbue the player with a range of abilities that the (more or less) contemporary and (in a manner of speaking) historical settings of previous Call of Duty games didn’t allow. For the most part, that means double-jump and boost mechanics, though there are different contextual uses for the suits throughout the game’s campaign.
“All of this makes moment-to-moment navigation much more interesting in Advanced Warfare than previous entries in the series or its imitators have managed,” Polygon’s review states. “The exo conceit also allows Sledgehammer to vary up the single-player campaign’s format and ideas in some exciting new ways.
“In fact, speaking strictly from level and encounter design and mission variety, Advanced Warfare is the best campaign the series has seen since Infinity Ward re-imagined the franchise with Modern Warfare in 2007. There’s no muddy objectives to get stuck on, and at least on my playthrough on the “hardened” difficulty setting, there were very few cheap-feeling death loops to get stuck in. It balances fairness with enough challenge and sophistication to make success feel worth it, and I never felt like any one part overstayed its welcome.”
Joystiq – which has yet another distinct mix of review conditions to consider – is similarly impressed with the way Advanced Warfare enlivens the core mechanics of the Call of Duty series with its new bag of tricks, awarding the game a commendable four-stars. However, there is also the lingering sense that Sledgehammer didn’t go far enough, assembling a clutch of innovative and empowering ideas but leaving most of them to bit-parts, cameos and walk-ons.
“On the one hand, you have the multi-function tactical grenade, which can either down drones with an EMP blast, stun enemies in a burst of light or paint targets through walls,” Joystiq states. “Selecting the right option is a rewarding decision, and not always easy to do quickly under fire. It’s a meaningful part of your arsenal.
“Less dependable are abilities like cloaking or a sonic pulse that disorients nearby enemies, which only appear for some missions. More exotic still are things like the grappling hook, a thrilling device that is first used in an awkward stealth mission. There’s a brilliant urban level later where these futuristic devices open the game up: You grapple between terraces and a central train track, yank enemies out of their power suits and launch yourself into massive, emplaced turrets to tear things up. It’s exciting, dynamic and as bombastic as any Call of Duty.
“It’s a shame these mechanisms come across as guest stars, because their use feels so fitting with Advanced Warfare’s unabashed science fiction shooting gallery… It just doesn’t have the power to break through the expectations of the brand, often coming across as an expertly played round of Call of Duty Mad Libs.”
This speaks to the concerns voiced by US Gamer, Advanced Warfare’s harshest critic at present with a score of 7 out of 10. There are inventive touches here, the sort that Call of Duty’s last few iterations have lacked, but this is innovation only in context. Advanced Warfare feels original in comparison to the series’ previous entries, but Sledgehammer is only reinventing the bubble in which these games exist. US Gamer acknowledges the delight that will bring to, “those who view gaming through the prism of Call of Duty and little else,” but the creative compromises made in the name of protecting the brand are all too clear.
“In a setting rife with possibilities, Advanced Warfare proves surprisingly short on imagination… In terms of design, there’s little to separate Advanced Warfare’s campaign from previous games in the series; and indeed, it frequently recycles tropes from previous games.
“After all these years of playing Call of Duty, the tweaks in Advanced Warfare just don’t do enough to mix up the formula, which is quietly becoming stale … There was a time not so long ago when ‘No Russian’ was on everyone’s lips, and Call of Duty was lauded for its daring and ambition in bringing RPG elements to multiplayer-a controversial choice back in 2007, when conventional wisdom ruled that XP would dramatically unbalance the action in favour of experienced players.
“There is a danger, however, in striving only to keep your core fans happy. Too often, it is easy for development teams to get lost in the echo chamber created by their game’s most vocal fans, which has the effect of encouraging them to prioritise balance changes over more ambitious endeavours. That is what I feel has happened with Call of Duty: Advanced Warfare, which tries very hard to capture the essence and the flavour of the series, and is ultimately a little too successful.”
In an interview that Xbox head Phil Spencer gave to IGN, he says that a new IP is in development at one of Microsoft’s development studios. It apparently isn’t a new racing or military space marine title.
Spencer says that the Xbox brand needs “new stories and new characters” which provide a “canvas to try new things.” He went on to add that “Sunset Overdrive is a great example of a game that isn’t like anything else in our portfolio, and he thinks that is great. I want to continue to invest in things which push the boundaries.”
Spencer believes that it has to be a commitment from the first-party publisher to try things that are new and unique. While he would not offer a clue as to which studio might be working on this new IP or what the new IP might be, he does seem to imply that there is at least more than one internal/external studio that is working on unannounced games for Microsoft studios.
In the interview he again says that he wants RARE to be more than the Kinect Sports developer and he is in fact heading out to see them soon to look at a new pitch from the studio.
To be more specific, that’s a difference of 3 million units, with Advanced Warfare expected to sell around 17 million. Obviously, that’s still a very healthy number, and the sort of success that most publishers rarely experience, but nevertheless it would be ill news for what remains Activision’s most important franchise.
Ghosts was, in itself, markedly less successful than Black Ops II, and a second year of decline will be enough to cause concern within Activision. When pre-orders for Ghosts were lower than expected, Eric Hirshberg attributed it to the transition to a new generation of consoles. With a minimum of 15 million PlayStation 4s and Xbox Ones now in the wild, that explanation would not stand up quite as well with Advanced Warfare.
In a note given to Cinema Blend, Sterne Agee’s Arvind Bhatia gave several reasons for the possibility of ongoing decline, one of which was the number of people who are still waiting to upgrade to new generation hardware, and may not buy any new software until they do. The others were sharply declining sales of Xbox 360 and PS3 software, and the fact that some Call of Duty fans may have been disappointed with Ghosts.
A significant counter to that is the positioning of Battlefield: Hardline, which slipped to March 2015 release and left Activision’s franchise free of its fiercest competitor.
Given its huge investment in Bungie’s Destiny and the relatively cool critical response that greeted the game, Activision will be hoping that Sterne Agee’s research is not an indicator of Call of Duty’s long-term health.