When the original Doom was released in 1993, its unprecedentedly realistic graphic violence fueled a moral panic among parents and educators. Over time, the game’s sprite-based gore has lost a bit of its impact, and that previous sentence likely sounds absurd.
Given what games have depicted in the nearly quarter century since Doom, that level of violence no longer shocking so much as it is quaint, perhaps even endearing. So when it came time for id Software to reboot the series with last year’s critically acclaimed remake of Doom, one of the things the studio had to consider was exactly how violent it should be, and to what end.
Speaking with GamesIndustry.biz at the Game Developers Conference last month, the Doom reboot’s executive producer and game director Marty Stratton and creative director Hugo Martin acknowledged that the context of the first Doom’s violence had changed greatly over the years. And while the original’s violence may have been seen as horrific and shocking, they wanted the reboot to skew closer to cartoonishly entertaining or, as they put it, less Saw and more Evil Dead 2.
“We were going for smiles, not shrieks,” Martin said, adding, “What we found with violence is that more actually makes it safer, I guess, or just more acceptable. It pushes it more into the fun zone. Because if it’s a slow trickle of blood out of a slit wrist, that’s Saw. That’s a little bit unsettling, and sort of a different type of horror. If it’s a comical fountain of Hawaiian Punch-looking blood out of someone’s head that you just shot off, that’s comic book. That’s cartoonish, and that’s what we wanted.”
“They’re demons,” Stratton said. “We don’t kill a single human in all of Doom. No cursing, no nudity. No killing of humans. We’re actually a pretty tame game when you think about it. I’ve played a lot of games where you just slaughter massive amounts of human beings. I think if we had to make some of the decisions we make about violence and the animations we do and if we were doing them to humans, we would have completely different attitudes when we go into those discussions. It’s fun to sit down in a meeting and think about all the ways it would be cool to rip apart a pinky demon or an imp. But if we had the same discussions about, ‘How am I going to rip this person in half?’ or rip his arm off and beat him over the head with it, it takes on a different connotation that I don’t know would be as fun.”
That balancing act between horror and comedy paid off for the reboot, but it was by no means the only line last year’s Doom had to straddle. There was also the question of what a modern Doom game would look like. The first two Doom games were fast-paced shooters, while the third was a much slower horror-tinged game where players had to choose between holding a gun or a flashlight at the ready. Neither really fit into the recent mold of AAA shooters, and the developers knew different people would have very different expectations for a Doom game in 2016.
As Stratton explained, “At that point, we went to, ‘What do we want? What do we think a Doom game should be moving forward?’As much as we always consider how the audience is going to react to the game–what they’re thinking, and what we think they want–back in the very beginning, it was, ‘What do we think Doom should be, and what elements of the game do we want to build the future of Doom on?’ And that’s really where we came back to Doom 1, Doom II, the action, the tone, the attitude, the personality, the character, the irreverence of it… those were all key words that we threw up on the board in those early days. And then mechanically, it was about the speed. It was about unbelievable guns, crazy demons, really being very honest about the fact that it was Doom. It was unapologetic early on, and we built from there.”
It helped that they had a recent example of how not to bring Doom into the current generation. Prior to the Doom reboot, id Software had been working on Doom 4, which Stratton said was a good game, but just didn’t feel like Doom. For one, it cast players as a member of a resistance army rather than a one-marine wrecking crew. It was also slower from a gameplay perspective, utilizing a cover-based system shared by numerous modern shooters designed to make the player feel vulnerable.
“None of us thought that the word ‘vulnerable’ belonged in a proper Doom game,” Martin said. “You should be the scariest thing in the level.”
Doom 4 wasn’t a complete write-off, however. The reboot’s glory kill system of over-the-top executions actually grew out of a Doom 4 feature, although Stratton said they made it “faster and snappier.”
Of course, not everything worked as well. At one point the team tried giving players a voice in their ears to help guide them through the game, a pretty standard first-person shooter device along the lines of Halo’s Cortana. Stratton said while the device works well for other franchises, it just didn’t feel right for Doom, so it was quickly scrapped.
“We didn’t force anything,” Stratton said. “If something didn’t feel like Doom, we got rid of it and tried something that would feel like Doom.”
That approach paid off well for the game’s single-player mode, but Stratton and Martin suggested they weren’t quite as thrilled with multiplayer. Both are proud of the multiplayer (which continues to be worked on) and confident they delivered a high quality experience with it, but they each had their misgivings about it. Stratton said if he could change one thing, it would have been to re-do the multiplayer progression system and give more enticing or better placed “hooks” to keep players coming back for game after game. Martin wished the team had messaged what the multiplayer would be a little more clearly, saying too many expected a pure arena shooter along the lines of Quake 3 Arena, when that was never the development team’s intent.
Those issues aside, it’s clear the pair feel the new wrinkles and changes they made to the classic Doom formula paid off more often than not.
“Lots worked,” Stratton said. “That’s probably the biggest point of pride for us. The game really connected with people. We always said we wanted to make something that was familiar to long-time fans, felt like Doom from a gameplay perspective and from a style and tone and attitude perspective. And I think we really accomplished that at a high level. And I think we made some new fans, which is always what you’re trying to do when you have a game that’s only had a few releases over the course of 25 years… You’re looking to bring new people into the genre, or into the brand, and I think we did that.”
Washington D.C. intends to become the home of eSports in the United States, with a strategy that includes sponsorship of the NRG Esports team and the construction of a $65 million stadium.
The city’s plans, which were revealed to Mashable, will be executed by Events D.C., the District of Columbia’s convention and sports authority. The deal with NRG Esports is among the first instances of a city sponsoring a pro gaming organisation, and Washington D.C. will now have its logo and branding on NRG teams’ uniforms, livestreams and websites.
NRG, which has teams competing in Overwatch, Counter-Strike: GO, Hearthstone and Rocket League, has roots in the world of traditional sports. It was founded by Andy Miller and Mark Mastrov, the co-owners of the NBA’s Sacramento Kings, and counts the basketball player Shaquille O’Neal and the baseball stars Alex Rodriguez and Jimmy Rollins among its investors.
“This is just another prong in our strategic approach to continue to make D.C. a great place to live and work and play,” Events D.C. chairman Max Brown told Mashable, highlighting the number of students attending the city’s many universities.
“There are lots of younger kids who are here and are coming here every year through our universities, so we think it makes a lot of sense for us as a city to plant a flag [for eSports], and ultimately be the capital of eSports like we’re the capital of the United States.”
There are other “prongs” to the city’s strategy, the most notable being the construction of a new stadium. The arena will be used by the WNBA team the Washington Mystics, as well as other events, but it is being built “with eSports in mind.”
“A $65 million 4,200-seat, state-of-the-art arena,” Brown added. “[It will] come online in late-2018, early-2019. Fully tailored and wired for esports.”
The games industry’s leading analysts have highlighted just how difficult it is to predict how well Nintendo Switch will perform.
IHS, SuperData, DFC and Niko Partners’ predictions range from 4.4m to 10m shipped by the end of 2017.
DFC thinks Nintendo Switch will sell 8.3m units in its first year, as detailed back in January, to eventually hit an install base of 40m.
IHS estimate a rather weak first year for Switch at just 4,4m, reaching 10m by year two and 30m by the end of the lifecycle – which is a slower start than Wii U but a stronger finish.
SuperData, as revealed yesterday, have concerns over the Switch’s price and software line-up and pencil year one as hitting just 5m units – which is slightly better than Wii U.
Finally, Niko Partners’ Daniel Ahmad thinks the machine could ship 10m this year, although how it does beyond that he’s not sure. That’s stronger than most Nintendo launches, but behind that of Wii and PS4.
Much like previous consoles from the company, Nintendo is targeting an altogether different market to PS4 and Xbox One, and even a slightly different one to its previous machines – which makes estimating its potential difficult.
There are legitimate concerns about the price – if not of the console itself, then the accessories and games. Although it’s possible Nintendo will address this if consumer uptake is sluggish, as it has done in the past with 3DS and GameCube.
There are also concerns about the relatively soft launch line-up and the rather sparse schedule throughout the year – although it’s important to note major first-party IP including Zelda, Mario Kart, Mario and Splatoon are all scheduled to launch his year. It’s also likely Nintendo is holding off many game announcements for E3 in June.
As we’ve observed twice now, it appears Nintendo is taking a softer approach to the launch of Switch than previous machines, although early retail reports is that the product is selling out in many locations.
We won’t get an accurate picture of the Switch’s potential for little while now. In the words of our very own Rob Fahey: “As with any risky new venture, keeping an open mind until the picture is clearer is going to serve any observer of the industry well.”
Nintendo has doing its best to see off stories that its new Switch portable console is blighted with dead pixels.
Those who have got their paws on the Switch have been complaining of distracting dead or stuck pixels, or light or dark patches on the screens of their brand-new consoles.
Nintendo’s answer to this is that such pixels are “normal” and are not defects. In contradiction to this statement, Nintendo claims that only a small number of cases have been reported.
Either way if you have a problem with dead pixels Nintendo will not give you another one.
But “dead” pixels belong to the early days of LCD screen technology but improvements in the underlying technology and manufacturing techniques driven by their use in billions of smartphones has generally been regarded to have significantly reduced the issue.
It seems that Nintendo has not learnt much about customer support a similar issue happened with the Nintendo DS at launch in the US, but the Japanese gaming company eventually relented after complaints from buyers.
Nintendo said at the time: “We suggest that you use your system for a few weeks to determine whether this interferes with your enjoyment of game play. If, after using your system for awhile, you feel that this tiny dot is too distracting, the Nintendo DS does carry a one-year warranty.”
Bizarrely Nintendo also warned users that using the Switch near an aquarium or within a metre of another wireless device, including laptops, wireless headsets, wireless printers, microwaves, cordless phones or even USB-3.0 compatible devices “such as hard drives, thumb drives, LAN adapters, etc”, might cause the Joy-Con controllers to disconnect from the Switch.
It is increasingly looking like Nintendo are trying to shifted a console with an underpowered processor and graphics system with dodgy LCD screens on a slightly more cynical buying public. Time will tell if it will get away with it.
According to details provided over at EA’s Origin site, those looking to play the new Mass Effect game will need at least an Intel Core i5-3570 or AMD FX-6350 CPU, 8GB of RAM and Nvidia Geforce GTX 660 2GB or AMD Radeon HD 7850 2GB graphics card.
The recommended system requirements rise up to an Intel Core i7-4790 or AMD FX-8350 CPU, 16GB of RAM and either an Nvidia GTX 1060 3GB or AMD RX 480 4GB graphics card.
Both minimum and recommended system requirements include at least 55GB of storage space as well as a 64-bit version of Windows 7, Windows 8.1 or Windows 10 OS.
The official release for the game is set for March 21st in the US and March 23rd in Europe and it will be coming to PC, Playstation 4 and Xbox One. Those with EA Access and Origin Access should get the game five days earlier.
It doesn’t feel right. It all seems so muted. Sure, there are those that can’t decide if Nintendo has made the ultimate games machine or the most pointless, but even so, it doesn’t feel like a new machine from the most iconic name in video games is a little over a week away.
Up until yesterday’s onslaught of unboxing videos, there has been a distinct lack of significant press coverage. Where’s the massive media campaign? Where’s the release countdowns? Where’s the surprise last minute announcements?
You know something is up when Sony’s big new IP launch, Horizon: Zero Dawn (which is also out next week) is comfortably winning the PR battle. Switch was announced six weeks ago and somehow it has already managed to lose its momentum.
And there’s so much we still don’t know about it. Where are all the games that have been promised? What about the Virtual Console? How does the online infrastructure work?
If I was a cynical man, I’d almost suggest that Nintendo is sending its next console out to fail and are preparing a more complete ‘switch’ to smartphones in the near future.
The reality is perhaps something a little more simple – the launch of Nintendo Switch just isn’t that important. Christmas is the true test.
By the end of March, there will be 2m units in the channel worldwide, which is a relatively cautious figure (Nintendo sold 3m Wii Us in that time, albeit over Christmas). There should be more than enough Nintendo fans or Zelda obsessives to pick up most of those – the sort of people who have already dropped £150 on the new Zelda collector’s edition and its assorted Amiibo (which are all gone). Switch has sold out at major US retailers, although there’s still some stock available in the UK.
In fact, you can easily see who Nintendo is targeting with Switch by the level of PR and marketing focus being spent on the new Zelda, as opposed to the actual console.
If you think back to the last time Nintendo released a console at this time in the year, it was the 3DS in 2011. Nintendo got the fundamentals of that launch wrong, both in terms of software line-up, price and PR positioning. In the months that followed the company took drastic action. It dropped the price significantly, ramped up its development resources and launched two big games at Christmas (Super Mario 3D Land and Mario Kart 7). The move meant the 3DS had a strong first Christmas, and the console went from there to 65m units globally in five years.
That first Christmas is crucial and is often more important than the console launch itself.
Nintendo now has the same window of correction. Based on its current schedule, by Christmas there will be four significant first-party Switch games available (Zelda, Mario Kart, Splatoon 2 and Mario Odyssey). It will have a better idea of what parts of the machine are resonating and which aspects are not. It will also know for certain if that price is too prohibitive for anyone that isn’t a hardcore Nintendo fan.
We will have also passed E3. We will know whether GameCube games are coming to Switch and we’ll have a better idea of what the software pipeline looks like.
If you look at the rather understated marketing campaign, the continued announcement of new 3DS titles, the fact that Nintendo revealed the release date so late (including to many of its own employees), and the absence of rather salient information about the machine’s digital functionality, and you get the feeling that the arrival of Switch next week is almost a soft launch.
There’s a risk here. Next week Nintendo has a brand job to do in establishing the Switch, irrespective of how many units it has in the channel. And the problem with soft launches is that consumers and third-parties can quickly perceive a cautious approach as a failed one – it’s something Sony has been wrestling with a little bit with its approach to PlayStation VR.
the close of March, Nintendo should have 2m Switch consoles in people’s homes worldwide. The machine will be doing the rounds with friends and families, word will spread, there are a smattering of big releases during Spring and Summer to keep the conversation going. And then by November, as Sony’s PS4 Pro and Microsoft’s Project Scorpio duke it out over the high end sector, Nintendo have their £250 hybrid complete with a new Mario to tempt you.
It almost sounds deliberate.
When I first began my career in the games industry I wrote a story about an impending digital download chart.
It was February 2008 and Dorian Bloch – who was leader of UK physical games data business Chart-Track at the time – vowed to have a download Top 50 by Christmas.
It wasn’t for want of trying. Digital retailers, including Steam, refused to share the figures and insisted it was down to the individual publishers and developers to do the sharing (in contrast to the retail space, where the stores are the ones that do the sharing). This led to an initiative in the UK where trade body UKIE began using its relationships with publishers to pull together a chart. However, after some initial success, the project ultimately fell away once the sheer scale of the work involved became apparent.
Last year in the US, NPD managed to get a similar project going and is thus far the only public chart that combines physical and digital data from accurate sources. However, although many big publishers are contributing to the figures, there remains some notable absentees and a lack of smaller developers and publishers.
In Europe, ISFE is just ramping up its own project and has even began trialling charts in some territories (behind closed doors), however, it currently lacks the physical retail data in most major markets. This overall lack of information has seen a rise in the number of firms trying to plug the hole in our digital data knowledge. Steam Spy uses a Web API to gather data from Steam user profiles to track download numbers – a job it does fairly accurately (albeit not all of the time).
SuperData takes point-of-sale and transaction information from payment service providers, plus some publishers and developers, which means it can track actual spend. It’s strong on console, but again, it’s not 100% accurate. The mobile space has a strong player in App Annie collecting data, although developers in the space find the cost of accessing this information high.
It feels unusual to be having this conversation in 2017. In a market that is now predominantly digital, the fact we have no accurate way of measuring our industry seems absurd. Film has almost daily updates of box office takings, the music market even tracks streams and radio plays… we don’t even know how many people downloaded Overwatch, or where Stardew Valley would have charted. So what is taking so long?
“It took a tremendous amount of time and effort from both the publisher and NPD sides to make digital sales data begin to flow,” says Mat Piscatella, NPD’s US games industry analyst. NPD’s monthly digital chart is the furthest the industry has come to accurate market data in the download space.
“It certainly wasn’t like flipping a switch. Entirely new processes were necessary on both sides – publishers and within NPD. New ways of thinking about sales data had to be derived. And at the publishers, efforts had to be made to identify the investments that would be required in order to participate. And of course, most crucially, getting those investments approved. We all had to learn together, publishers, NPD, EEDAR and others, in ways that met the wants and needs of everyone participating.
“Over time, most of the largest third-party publishers joined the digital panel. It has been a remarkable series of events that have gotten us to where we are today. It hasn’t always been smooth; and keep in mind, at the time the digital initiative began, digital sales were often a very small piece of the business, and one that was often not being actively managed. Back then, publishers may have been letting someone in a first-party operation, or brand marketing role post the box art to the game on the Sony, Microsoft and Steam storefronts, and that would be that. Pricing wouldn’t be actively managed, sales might be looked at every month or quarter, but this information certainly was not being looked at like packaged sales were. The digital business was a smaller, incremental piece of the pie then. Now, of course, that’s certainly changed, and continues to change.”
“For one, the majors are publicly traded firms, which means that any shared data presents a financial liability. Across the board the big publishers have historically sought to protect the sanctity of their internal operations because of the long development cycles and high capital risks involved in AAA game publishing. But, to be honest, it’s only been a few years that especially legacy publishers have started to aggregate and apply digital data, which means that their internal reporting still tends to be relatively underdeveloped. Many of them are only now building the necessary teams and infrastructure around business intelligence.”
Indeed, both SuperData and NPD believe that progress – as slow as it may be – has been happening. And although some publishers are still holding out or refusing to get involved, that resolve is weakening over time. “For us, it’s about proving the value of participation to those publishers that are choosing not to participate at this time,” Piscatella says. “And that can be a challenge for a few reasons. First, some publishers may believe that the data available today is not directly actionable or meaningful to its business. The publisher may offer products that have dominant share in a particular niche, for example, which competitive data as it stands today would not help them improve.
“Second, some publishers may believe that they have some ‘secret sauce’ that sharing digital sales data would expose, and they don’t want to lose that perceived competitive advantage. Third, resources are almost always stretched thin, requiring prioritisation of business initiatives. For the most part, publishers have not expanded their sales planning departments to keep pace with all of the overwhelming amount of new information and data sources that are now available. There simply may not be the people power to effectively participate, forcing some publishers to pass on participating, at least for now.
“So I would certainly not classify this situation as companies ‘holding out’ as you say. It’s that some companies have not yet been convinced that sharing such information is beneficial enough to overcome the business challenges involved. Conceptually, the sharing of such information seems very easy. In reality, participating in an initiative like this takes time, money, energy and trust. I’m encouraged and very happy so much progress has been made with participating publishers, and a tremendous amount of energy is being applied to prove that value to those publishers that are currently not participating.”
NPD’s achievements is significant because it has managed to convince a good number of bigger publishers, and those with particularly successful IP, to share figures. And this has long been seen as a stumbling block, because for those companies performing particularly well, the urge to share data is reduced. I’ve heard countless comments from sales directors who have said that ‘sharing download numbers would just encourage more competitors to try what we’re doing.’ It’s why van Dreunen has noted that “as soon as game companies start to do well, they cease the sharing of their data.”
Indeed, it is often fledgling companies, and indie studios, that need this data more than most. It’s part of the reason behind the rise of Steam Spy, which prides itself on helping smaller outfits.
“I’ve heard many stories about indie teams getting financed because they managed to present market research based on Steam Spy data,” boasts Sergey Galyonkin, the man behind Steam Spy. “Just this week I talked to a team that got funded by Medienboard Berlin-Brandenburg based on this. Before Steam Spy it was harder to do a proper market research for people like them.
“Big players know these numbers already and would gain nothing from sharing them with everyone else. Small developers have no access to paid research to publish anything.
“Overall I’d say Steam Spy helped to move the discussion into a more data-based realm and that’s a good thing in my opinion.”
The games industry may be behaving in an unusually backwards capacity when it comes to sharing its digital data, but there are signs of a growing willingness to be more open. A combination of trade body and media pressure has convinced some larger publishers to give it a go. Furthermore, publishers are starting to feel obligated to share figures anyway, especially when the likes of SuperData and Steam Spy are putting out information whether they want them to or not.
Indeed, although the chart Dorian promised me 9 years ago is still AWOL, there are at least some figures out there today that gives us a sense of how things are performing.
“When we first started SuperData six years ago there was exactly zero digital data available,” van Dreunen notes. “Today we track the monthly spending of 78 million digital gamers across platforms, in spite of heavy competition and the reluctance from publishers to share. Creating transparency around digital data is merely a matter of market maturity and executive leadership, and many of our customers and partners have started to realize that.”
He continues: The current inertia comes from middle management that fears new revenue models and industry changes. So we are trying to overcome a mindset rather than a data problem. It is a slow process of winning the confidence and trust of key players, one-at-a-time. We’ve managed to broker partnerships with key industry associations, partner with firms like GfK in Europe and Kadokawa Dwange in Japan, to offer a complete market picture, and win the trust with big publishers. As we all move into the next era of interactive entertainment, the need for market information will only increase, and those that have shown themselves willing to collaborate and take a chance are simply better prepared for the future.”
NPD’s Piscatella concludes: “The one thing I’m most proud of, and impressed by, is the willingness of the participating publishers in our panel to work through issues as they’ve come up. We have a dedicated, positive group of companies working together to get this information flowing. Moving forward, it’s all about helping those publishers that aren’t participating understand how they can benefit through the sharing of digital consumer sales information, and in making that decision to say “yes” as easy as possible.
“Digital selling channels are growing quickly. Digital sales are becoming a bigger piece of the pie across the traditional gaming market. I fully expect participation from the publishing community to continue to grow.”
If you’re someone who makes a living from videogames – as most readers of this site are – then political developments around the world at the moment should deeply concern you. I’m sure, of course, that a great many of you are concerned about things ranging from President Trump’s Muslim travel ban to the UK Parliament’s vote for “Hard Brexit” or the looming elections in Holland and France simply on the basis of being politically aware and engaged. However, there’s a much more practical and direct way in which these developments and the direction of travel which they imply will impact upon us. Regardless of personal ideology or beliefs, there’s no denying that the environment that seems to be forming is one that’s bad for the medium, bad for the industry, and will ultimately be bad for the incomes and job security of everyone who works in this sector.
Video games thrive in broadly the same conditions as any other artistic or creative medium, and those conditions are well known and largely undisputed. Creative mediums benefit from diversity; a wide range of voices, views and backgrounds being represented within a creative industry feeds directly into a diversity of creative output, which in turn allows an industry to grow by addressing new groups of consumers. Moreover, creative mediums benefit from economic stability, because when people’s incomes are low or uncertain, entertainment purchases are often among the first to fall.
Once upon a time, games had such strong underlying growth that they were “recession proof,” but this is no longer the case. Indeed, it was never entirely an accurate reading anyway, since broader recessions undoubtedly did slow down – though not reverse – the industry’s growth. Finally, as a consequence of the industry’s broad demographic reach, expansion overseas is now the industry’s best path to future growth, and that demands continued economic progress in the developing world to open up new markets for game hardware and software.
What is now happening on a global basis threatens all of those conditions, and therefore poses a major commercial threat to the games business. That threat must be taken especially seriously given that many companies and creators are already struggling with the enormous challenges that have been thrown up by the messy and uneven transition towards smart devices, and the increasing need to find new revenue streams to support AAA titles whose audience has remained largely unchanged even as development budgets have risen. Even if the global economic system looked stable and conditions were ideal for creative industries, this would be a tough time for games; the prospect of restrictions on trade and hiring, and the likelihood of yet another deep global recession and a slow-down in the advances being made by developing economies, make this situation outright hazardous.
Consider the UK development industry. Since well over a decade ago, if you asked just about any senior figure in the UK industry what the most pressing problem they faced was, they’d give you the same answer: skills shortages. Hiring talented staff is tough in any industry, but game development demands highly skilled people from across a range of fields, and assembling that kind of talent isn’t cheap or easy – even when you have access to the entire European Union as a hiring base, as UK companies did. Now UK companies face having to fill their positions with a much smaller pool of talent to draw from, and hiring from abroad will be expensive, complex and, in many cases, simply impossible.
The US, too, looks like it may tighten visa regulations for skilled hires from overseas, which will have a hugely negative impact on game development there. There are, of course, many skilled creatives who work within the borders of their own country, but the industry has been built on labour flows; centres of excellence in game development, like the UK and parts of the US, are sustained and bolstered by their ability to attract talent from overseas. Any restriction on that will impact the ability of companies to create world-class games – it will make them poorer creatively and throw hiring roadblocks in the path of timely, well-polished releases.
Then there’s the question of trade barriers; not only tariffs, which seem likely to make a comeback in many places, but non-tariff barriers in terms of diverse regulations and standards that will make it harder for companies to operate across national borders. The vast majority of games are multinational efforts; assets, code, and technology are created in different parts of the world and brought together to create the final product. Sometimes this is because of outsourcing, other times it’s because of staff who work remotely, and very often it’s simply because a certain piece of technology is licensed from a company overseas.
If countries become more hostile to free trade, all of that will become more complex and expensive. And that’s even before we start to think about what happens to game hardware, from consoles that source components from across Asia before assembly in China or Japan, to PC and smart device parts that flow out of China, Korea, Taiwan and, increasingly, from developing nations in South-East Asia. If tariff barriers are raised, all of those things will get a lot more expensive, limiting the industry’s consumer base at the most damaging time possible.
Such trade barriers – be they tariff barriers or non-tarriff barriers – would disproportionately impact developing countries. Free trade and globalisation have had negative externalities, unquestionably, but by and large they have contributed to an extraordinary period of prosperity around the world, with enormous populations of people being lifted out of poverty in recent decades and many developing countries showing clear signs of a large emerging middle class. Those are the markets game companies desperately want to target in the coming decade or so. In order for the industry to continue to grow and prosper, the emerging middle class in countries like India, Brazil and Indonesia needs to cultivated as a new wave of game consumers, just as many markets in Central and Eastern Europe were a decade ago.
The current political attacks on the existing order of world trade threaten to cut those economies off from the system that has allowed them to grow and develop so quickly, potentially hurling them into deep recession before they have an opportunity to cement stable, sustainable long-term economic prosperity. That’s an awful prospect on many levels, of course (it goes without saying that many of the things under discussion threaten human misery and catastrophe that far outweighs the impact on the games business), but one consequence will likely be a hard stop to the games industry’s capacity to grow in the coming years.
It’s not just developing economies whose consumers are at risk from a rise of protectionism and anti-trade sentiments, however. If we learned anything from the 2008 crash and the recession that followed, it should be that the global economy largely runs not on cash, but on confidence. The entire edifice is built on a set of rules and standards that are designed to give investors confidence; the structure changes over time, of course, but only slowly, because stability is required to allow people to invest and to build businesses with confidence that the rug won’t be tugged out from underneath them tomorrow. From the rhetoric of Donald Trump to the hardline Brexit approach of the UK, let alone the extremist ideas of politicians like Marine le Pen and Geert Wilders, the current political movement deeply threatens that confidence. Only too recently we’ve seen what happens to ordinary consumers’ job security and incomes when confidence disappears from the global economy; a repeat performance now seems almost inevitable.
Of course, the games industry isn’t in a position to do anything about these political changes – not alone, at least. The same calculations, however, apply to a wide variety of industries, and they’re all having the same conversations. Creative industries are at the forefront for the simple reason that they will be the first to suffer should the business environment upon which they rely turn negative, but in opposing those changes, creative businesses will find allies across a wide range of industries and sectors.
Any business leader that wants to throw their weight behind opposing these changes on moral or ethical grounds is more than welcome to, of course – that’s a laudable stance – but regardless of personal ideology, the whole industry should be making its voice heard. The livelihoods of everyone working in this industry may depend on the willingness of the industry as a whole to identify these commercial threats and respond to them clearly and powerfully.
Physical retailers are calling for a change in how video game pre-orders are conducted.
They are speaking to publishers and platform holders over the possibility of selling games before the release date. Consumers can pick up the disc 1 to 3 weeks before launch, but it will remain ‘locked’ until launch day.
The whole concept stems from the pre-loading service available in the digital space. Today, consumers can download a game via Steam, Xbox Live and PSN before it’s out, and the game becomes unlocked at midnight on launch day for immediate play (after the obligatory day one patch).
It makes sense to roll this out to other distribution channels. The idea of going into a shop to order a game, and then returning a month later to buy it, always seemed frankly antiquated.
Yet it’s not only consumer friendly, it’s potentially retailer and publisher friendly, too.
For online retailers, the need to hit an embargo is costly – games need to be turned around rapidly to get it into consumers’ hands on day one.
For mainstream retailers, it would clear up a lot of confusion. These stores are not naturally built for pre-ordering product, with staff that are more used to selling bananas than issuing pre-order receipts. The fact you can immediately take the disc home would help – it could even boost impulse sales.
Meanwhile, specialist retailers will be able to make a longer ‘event’ of the game coming out, and avoid the situation of consumers cancelling pre-orders or simply not picking up the game.
Yet when retail association ERA approached some companies about the prospect of doing this, it struggled to find much interest from the publishing community. So what’s the problem?
There are a few challenges.
There are simple logistical obstacles. Games often go Gold just a few weeks before they’re launched, and then it’s over to the disc manufacturers, the printers, the box makers and the distributors to get that completed code onto store shelves. This process can take two weeks in itself. Take the recent Nioh. That game was available to pre-download just a few days before launch – so how difficult would it be to get that into a box, onto a lorry and into a retailer in advance of release?
It also benefits some retailers more than others – particularly online ones, and those with strong distribution channels.
For big games, there’s a potential challenge when it comes to bandwidth. If those that pre-ordered Call of Duty all go online straight away at 12:01, that would put a lot of pressure on servers.
Piracy may also be an issue, because it makes the code available ahead of launch.
The end of the midnight launch may be happening anyway, but not for all games. If consumers can get their game without standing in the cold for 2 hours, then they will. And those lovely marketable pictures of snaking queues will be a thing of the past.
None of these obstacles are insurmountable. Getting the game finished earlier before launch is something that most big games publishers are trying to do, and this mechanism will help force that issue. Of course, the disc doesn’t actually have to contain a game at all. It can be an unlock mechanism for a download, which will allow the discs to be ready far in advance of launch. That strategy is significantly riskier, especially considering the consumer reaction to the same model proposed by Xbox back in 2013.
As for midnight events, there are still ways to generate that big launch ‘moment’. Capcom released Resident Evil 7 with an experiential haunted house experience that generated lots of media attention and attracted a significant number of fans. Pokémon last year ran a big fan event for Sun and Moon, complete with a shop, activities, signing opportunities and the chance to download Mew.
So there are other ways of creating launch theatre than inviting consumers to wait outside a shop. If anything, having the game available in advance of launch will enable these theatrical marketing events to last longer. And coupled with influencer activity, it would actually drive pre-release sales – not just pre-release demand.
However, the reality is this will work for some games and not for others, and here lies the heart of the challenge.
Pre-ordering is already a relatively complex matter, so imagine what it’ll be like if some games can be taken home in advance and others can’t? How many instances can we expect of people complaining that ‘their disc doesn’t work’?
If this is going to work, it needs cross-industry support, which isn’t going to happen. This is a business that can’t even agree on a digital chart, don’t forget.
What we may well see is someone giving this concept a go. Perhaps a digital native publisher, like Blizzard or Valve, who can make it part of their PR activity.
Because if someone like that can make the idea work, then others will follow.
Take-Two today reported its financial results for the three months ended December 31, and they paint a mixed picture of the company’s performance for the holiday season.
Speaking with GamesIndustry.biz, Take-Two chairman and CEO Strauss Zelnick touted the company’s holiday slate of releases, mostly updating numbers revealed around Take-Two’s last earnings report. Mafia III has now sold-in approximately 5 million copies, while Civilization VI has surpassed 1.5 million units sold-in. NBA 2K17 has sold-in nearly 7 million units (up about 10% year-over-year), while Grand Theft Auto V continues to move copies, with sell-in now topping 75 million. Its recurrent consumer spending business (virtual currency, microtransactions, and DLC)has also done well, Zelnick said, noting that Grand Theft Auto Online posted a record number of players in December.
Despite some of those gaudy numbers, the quarter was not an unqualified success. The publisher reported GAAP net revenues of $476.5 million, up 15% year-over-year but near the low end of its $475 million to $525 million guidance. Additionally, Take-Two’s guidance called for a net income of $17 million to $30 million, but it ultimately posted a net loss of $29.9 million for the quarter.
“I know it’s a bit clouded by GAAP reporting, which requires us to defer revenues, and requires us to accelerate costs related to those deferred revenues, so we have a mismatch,” Zelnick explained. “It can look like, from a GAAP point of view, that we’re not doing as well as we’re doing from a bookings and cash flow point of view.”
Total bookings for the quarter did indeed jump 51% year-over-year to $719 million, with the aforementioned titles and WWE 2K17 serving as the largest contributors to that number. Bookings from recurrent consumer spending did particularly well, growing 55% year-over-year and making up 23% of the company’s total bookings.
The holiday quarter also saw the release of Take-Two’s first VR efforts, Carnival Games VR and NBA2K VR Experience. The company didn’t provide any performance metrics for those titles, but it’s clear Zelnick wasn’t counting on them to contribute too much.
“We were happy to bring the titles to market because it was a reflection of the fact we have the R&D abilities to address video games in a VR format if and when that’s a meaningful part of the business,” he said. “I have expressed skepticism in the past, and I think that’s been borne out by the fact that the market for VR in video games remains quite small.”
Zelnick also addressed the company’s $250 million acquisition of Social Point, the Barcelona-based mobile developer of Dragon City and Monster Legends. As for how the new studio will be integrated into the company, Zelnick said the goal was more to support them to continue doing what they’ve already been successful doing, while being mindful not to mess with what works.
“What we like about Social Point is they have multiplicity, it’s not just one [hit] and that distinguishes them from a lot of people in this space,” Zelnick said. “And they know how to monetize those hits and interact with their audience. I’m hoping we can help them grow even faster, but minimally, we want to be supportive so they can keep doing what brought them to this place in the first place… the way we tend to integrate new creative acquisitions is we want those companies to retain their identity and their independence, and to continue to do what works in the market.”
That’s not to say the company is abandoning all hope of synergy. Zelnick said he hopes Take-Two can help lend its experience in Asian markets to help Social Point find success in those territories, while acknowledging that Take-Two can probably learn a few things about monetizing in a free-to-play environment that could be brought to bear on titles like NBA 2K Online and WWE Supercard.
Nintendo, is finally getting around to embracing third party development tools including the Unreal Engine.
Nintendo has always had trouble getting third-party developers to make games for its consoles, but the Switch is supposed to show off a new image for the former playing card maker.
Game designer Shigeru Miyamoto has announced that Nintendo engineers have been learning how to use third-party apps and especially the Unreal Engine.
The Switch, like the Wii U, supports the Unreal Engine but has not been particularly enthusiastic about it.
Nintendo’s Shinya Takahashi said Nintendo now wants to develop an environment where “a variety of different third-party developers are able to easily develop compatible software”.
Miyamoto also suggested that Japanese developers no longer are behind their western counterparts when it comes to third-party engines. He added that his engineers’ skill set can “now be compared with those of Western developers”.
While Nintendo will stick to using its own development tools when building games for its new hardware, its engineers are apparently trying to understand one of the most commonly-used game development engines.
You know a company has had a rough set of results when its CEO needs to publicly state that they represent the lowest extent of a slump, with a bounce surely to follow; this being essentially the line that Nintendo boss Tatsumi Kimishima attempted to soothe worried investors with this week. It didn’t exactly work; Nintendo shares, which had been trading at their highest levels in five years, dropped back below the 23,000 Yen mark for the first time since last September. The figures reveal sentiment; investors aren’t sold on the Switch, don’t really know what to make of Super Mario Run, and while they’re generally more positive on Nintendo than they were a couple of years ago, they’re feeling jittery and nervous about the firm’s prospects.
As well they should. In fact, 2017 is likely to be a rollercoaster of a year for Nintendo investors, and those nerves are likely going to get more and more jangled as the year rolls on. The reason for that is simple; Nintendo is taking risks, and they’re not the kind of risks that it’s easy to calculate an over-under on. That makes them into the kind of risks that investors love and hate at the same time – but mostly hate. If Nintendo’s risk-taking pays off, it might soar, but there’s also a strong chance it’ll all come crashing down, and the worst part is, nobody can accurately assess what the risk of either of those scenarios, or anything in between, may be.
There are essentially two major risks Nintendo is taking on. The first, of course, is Switch. The company is hoping for Wii-like sales of the device; almost anything would be an improvement over the Wii U, of course, but in reality it probably needs to hit 40 or 50 million to be considered a genuine success, while anything below 20 million would be enough of a disappointment to cast a pall over the company’s entire future in the home console business. Switch is a high-concept device, quite unlike anything else on the market; from the control system it affords to the mixed-mode portable/home console design of the system, it’s a genuinely unusual piece of kit (far more so than the Wii U was) and that alone will undoubtedly inspire a lot of early adopters to pick one up out of sheer curiosity. It could ignite the imagination of a wide swathe of consumers and become a must-have entertainment device, like the Wii before it. It could equally prove attractive only to Nintendo’s fanbase and sink into much-loved but commercially disastrous obscurity like the Wii U.
My personal guess is that it’ll do far better than the Wii U, but come nowhere close to the success of the Wii, but I’m at pains to call that a guess and nothing more. Anyone demanding that their forecast of the device’s performance is of more worth than mere guesswork is, bluntly, a bit of a charlatan. Not only is the market into which Switch is launching extremely poorly understood at the moment (find me a single soul who predicted pre-launch that PS4, at this point in its lifespan, would be outselling the mighty PS2?), with vast new differences emerging between different global markets and demographic groups, the device itself also has no clear analogues to which we might look for guidance. The strength of the Switch is that it’s Nintendo doing something genuinely different and distinctive from its competition – a metric on which the Wii U, ultimately, failed. The weakness of Switch is that that means success or failure, though clearly influenced greatly by traditional factors like software support, is impossible to pin down with a probability calculation.
Having one big, risky venture on the go would be enough to make investors jumpy, but Nintendo has another one running in parallel. The company has been told for years by its investors that it should be involved in the smartphone market, and indeed its recently relatively buoyant share price is largely the result of its initial announcement of a partnership to do just that with DeNA in 2015, and the launch of Pokemon Go last summer. As the company’s titles roll out, though, things are getting a little more grounded and sober, and investors are perhaps recalling that the market they’ve told Nintendo to dive into is one of the riskiest in the business. The first game title created under the Nintendo-DeNA partnership (discounting Miitomo, which wasn’t considered a game, and Pokemon Go, which was simply Nintendo IP licensed out to a different developer, Niantic) was Super Mario Run, which has been largely well-received critically but hasn’t set the world on fire otherwise. Eschewing the F2P business model and the various hooks and enticements it offers for player retention was taken as reassuring by the company’s vocal core fans, but has seen Super Mario Run fade rapidly from consumer consciousness. After a backlash over its $10 price, which laid out just how uphill the struggle for premium-priced mobile games is, Mario Run has managed around a 5% conversion rate and $53 million in revenue so far.
To be clear – that’s not bad, it’s just unremarkable, and not really what investors had hoped for when they pushed Nintendo towards mobile. The company’s next launch, Fire Emblem Heroes, arrived this week and uses the more established business model for mobile titles; a few months down the line we’ll also have an Animal Crossing title on mobile. The thing is that despite the popularity of these franchises and the pedigree of their development teams, their success simply isn’t assured – even the very best mobile developers have had trouble replicating their greatest successes or even being consistently successful with their titles. Many of the world’s biggest mobile game companies are essentially sustained by one huge, evergreen game, and show no evidence of knowing how to bottle that lightning; the reality is that it’s a hugely fickle, difficult market where, even if you produce a brilliant game, external factors (including a pretty big dose of luck) play an inordinately large role in success. Nobody should doubt the quality of the games Nintendo will launch on smartphones, but nobody should consider a gigantic commercial hit to be a sure thing, either.
All that being said, the point here isn’t that Nintendo is going in the wrong direction; it’s that it’s facing a risky, bumpy year ahead, and that’s going to play merry hell with the firm’s relationship with its investors. Since, unfortunately, the media remains convinced that stock markets are magically possessed of grand insights unattainable to mere humans, like a modern-day Oracle of Delphi – where the reality is that stock markets, in their short-term motions at least, are just the sum total of a load of largely not terribly well informed people charging around in blind mob panics – we’re going to see a lot of context-free stories this year about Nintendo’s share price plunging or recovering as the balance of risk seems to sway one way or the other. The reality behind that is that at least in the next few months, the actual nature of that risk profile is going to be utterly obscure to everyone – even to Nintendo itself.
Right now, the wrong direction for Nintendo would be the direction it was headed in two years ago; competing head-to-head with Sony and Microsoft with a home console that was poorly differentiated from the competition; pretending smartphones hadn’t upended its market; making some of the best software in its history for some of the least-played hardware on the market. The right direction is one that changes that path, and change means risk – especially when the only avenues of change available to you involve innovation, untested ideas, and a tough, poorly understood market.
Buried in Nintendo’s statements this week is cause for great optimism; the success of Pokemon Sun/Moon, which are already among the best-selling installments in the series, was built upon the use of Pokemon Go as a marketing and awareness vehicle, allowing Nintendo to reactivate older consumers of the franchise and change the demographic profile of its audience. As a test run for its future strategy of building struts of mutual support between mobile and console titles, it’s been damned near flawless; sure, it got lucky with a timely implementation of AR tech and a lovely marriage of IP to gameplay, but the underlying business strategy has also played out as well as could be hoped. These are the things to watch for in the next year. Ignore the markets; with any company as highly exposed to risk as Nintendo is right now, share price movements will be exaggerated and hypersensitive, even to rumour and falsehood. Watch, instead, for evidence that Nintendo’s actual plans – the things it wants to sell, the consumers it wants to cultivate and the ways it wants to link together its IPs across platforms and approaches – are coming together or falling apart. Only that will tell us whether Nintendo is really going to bounce back, or if Kimishima’s certainty that it’s already hit rock bottom is going to be tested.
Virtual reality will be coming to the Nintendo Switch – just as soon as the company is convinced people can play it for longer periods of time.
The news comes from an interview between Nintendo president Tatsumi Kimishima and Nikkei, as translated by Dr Serkan Toto, CEO of Tokyo-based consultancy Kantan Games. According to Toto’s tweets, Kimishima said Nintendo is studying VR now but will hold off until users can “play for hours on end without problems”.
Nintendo has been extremely cautious about virtual reality, partly due to ongoing reports of nausea and headaches among early adopters. The platform holder’s US president Reggie Fils-Aime also said the technology is “not fun” and “not social”.
However, patents emerged back in December for a virtual reality accessory designed to be used with the Nintendo Switch, suggesting the platform holder is at least preparing to make its new console VR-enabled.
Meanwhile, Kimishima has also detailed prices for Switch’s paid online service, suggesting Nintendo plans to ask for 2,000 to 3,000 yen per year.
3) Nintendo plans to introduce yearly and monthly paid plans for the online service. Again, price range is 2-3,000 yen/year (.70-.50).
— Dr. Serkan Toto (@serkantoto) February 2, 2017
As Toto observes, that translates to between $17.70 and $26.50, or £13.95 and £20.89 for the UK.
Little is know about the paid service yet, save that it will be required for online multiplayer titles and that subscribers will receive a free NES or SNES game every month. Some of the latter will also have online multiplayer added.
While the price point makes Switch’s paid service cheaper than those of PlayStation and Xbox, it will be interesting to see whether consumers deem there to be enough value to signing up. Both PlayStation and Xbox also offer free games every month, often major AAA releases from the past year, and thanks to strong third-party support the number of online multiplayer titles subscribers gain access to is much higher.
The Nintendo Switch launches worldwide on March 3rd, and VG247 reports that Kimishima is confident it will reverse the platform holder’s recent fortunes, with the president claiming Nintendo’s fiscal performance will only improve from here.
He said the Switch’s unique features mean it could sell as well as the Wii – which means Nintendo is targeting sales of around 100m. Regardless of whether or not it reaches that, hopes are high that it beats Wii U’s disappointing lifetime sales of 13.5m.
The traditional sports ecosystem is dominated by three models of organisation. The most decentralised sports, like the PGA Tour or NASCAR, consist of largely independently organised competitions, which are sanctioned and governed by an administrative body and are open to any qualifying athlete. From there, we have typical leagues like the NBA or Premiership, which have a set number of recurring teams and players, and are extensively managed by a league front office that’s owned by each team.
eSports are quite different. If you choose to race without NASCAR or play basketball without the NBA, there’s nothing – and no official body – that can prevent you from replicating the experience. No one ‘owns’ racing or basketball, but someone does own Overwatch, and if you want to play you essentially have to go through that company. If you wanted to create your own eSports league, your ability to market or represent it would be entirely dependent on the legal team of the game’s publisher. Furthermore, the core experience is fully controlled by that publisher.
“No one ‘owns’ racing or basketball, but someone does own Overwatch, and if you want to play you essentially have to go through that company”
Leagues that are operated or endorsed by publishers can do unique things – e.g. item drops, exclusive/first-release capabilities, bundled original content – and offer unique monetisation opportunities. Three months before The International, the annual world championship for Dota 2, Valve sells interactive in-game items that directly contribute to the tournament prize pool. This model has been so successful that, in 2016, the prize pool reached $19.17 million.
Most tier-one publishers also handicap the data streams that the public can leverage. Whereas in traditional sports there are multiple providers of a firehose of sports data, game publishers offer barebones APIs that allow access to little more than character information and select match data. Valve offers an open API but, as events this year have demonstrated, it can shut off access and change policy at any time. On the platform side, Twitch is miles ahead of its competitors in terms of creating an external ecosystem thanks to its two year head-start and passionate developer community, but it maintains an ever more precarious balance between build vs. buy.
Because of these walled gardens, the investible opportunities within eSports often end up being features not products, which set them and their investors up for more of an acquihire than a Twitch-esque exit. There’s a strong argument to be made to publishers that working with third-party developers will lead to a stronger overall bottom line, foster innovation and provide defensibility.
It’s no secret that being a top publisher is a lucrative business. Activision reported $1.57 billion in revenue for Q2 of 2016 and EA $1.271 billion. It’s rumoured that Valve’s 2015 revenues reached $3.5 billion in 2015, and Riot Games’ over $1.6 billion. It’s not hard to see why partnerships with third parties and external API infrastructure aren’t a priority with so much money flowing, but that’s shortsighted. As publishers start thinking about how to monetise beyond game licenses and IAP, every moment not spent developing the ecosystem is a wasted one.
This isn’t unparalleled, and we can see examples of where large platforms in other verticals have made the decision to invest in their future, often early on in their company lifecycle. Salesforce, an enterprise software company, has a market cap of $50 billion. A report last year by IDC put the opportunity front and center: the AppExchange currently generates 2.8x the revenue of Salesforce itself and is expected to grow to 3.7x the size of Salesforce.
“As publishers start thinking about how to monetise beyond game licenses and IAP, every moment not spent developing the ecosystem is a wasted one”
Slack, the enterprise collaboration tool darling, also gets it. Even before raising money in April 2016, at a $3.8 billion valuation and boasting over 1.25 million paying users, they announced the Slack fund in December 2015 - an $80 million investment into supporting new integrations. Slack and Salesforce could have gone the closed route and developed these integrations and products internally, but they understood that the immediate revenue trade-off was well worth the ability to focus on creating the best core product possible, in addition to leveraging minimal company resources.
Now to everyone’s favourite eSports comparison : traditional sports. During the height of the daily fantasy sports craze in 2014/15, the NBA entered a multi-year partnership with FanDuel that gave it an ownership stake. The NFL expanded its partnership with Providence Equity in 2013, investing $300 million to participate in, “media and technology deals where it believes the league could help play a strategic role.” And these are just a few examples. Partnering with and investing in new properties allows older, larger establishments to participate in the upside of nascent industries quickly and cheaply.
Publishers are thinking about the shelf-life of games. The NFL and NBA will both be around in 25 years, but what about League of Legends or Counter-Strike? Opening up the ecosystem not only benefits players and fans by allowing them an outlet to interact with their favorite IPs, but ultimately enhances the core value of those IPs and gives publishers an opportunity for additional exposure through revenue share, API fees and strategic investments.
In addition to commercial benefits, let’s look at network effects. Valve is the publisher of both Counter-Strike: Global Offensive (25 million+ copies sold, 8.2 million+ players in the last two weeks), and Dota 2 (87 million+ times downloaded, 11 million+ active players in the last two weeks.) While the titles have richer histories than virtually any other competitive esport, Valve’s open API, developer tools and hands-off approach has contributed to their sustained success and status as two of the top eSports titles.
ELeague, FaceIt Esports Championship Series and Gfinity, ESL One and IEM. These streams of revenue have contributed to a high demand for professional CS:GO players, leading to lucrative contracts and opportunities.
3: The most lucrative has been the in-game skins economy, which allows players to purchase crates that contain different cosmetic versions of CS:GO weapons or Dota 2 items. During major tournaments, Valve has offered exclusive stickers that generate up to high six-figures for qualified teams. Valve has also allowed free reign on opening up use cases within this skins economy, which led to wagering, gambling and marketplaces (Bloomberg estimated yearly transaction volume to be >$7 billion.) Variations of this model have since been followed very conservatively by multiple franchises, including Call of Duty, Halo, H1Z1 and Overwatch.
On the platform side, Twitch’s dominance in livestreaming can largely be credited to going all-in on eSports first, but Twitch also has numerous native or platform exclusive features for its users. Diving deeper, this experience is powered by a blend of features that were built in-house or created by third parties. Examples include:
Bits, preceded by Streamlabs and StreamTip: direct donations from viewers are one of the foundations of a streamer’s income.
Clips, preceded by Oddshot, Plays.tv and Forge: allows viewers and creators to efficiently capture highlights and share to different social media channels.
Subscriptions / Partner Program and 3rd-party services (Revlo, Gamewisp and Curse/Discord integrations): subscriptions are another big source of income for streamers, and the third-party services all add further value to a sub and reduce churn.
TwitchPlays: what started out as a fun social experiment (TwitchPlaysPokemon) is now its own category to interact with potential customers for publishers.
Chatbots (Moobot, Nightbot and Xanbot): automated assistants that help moderate chat to prevent spamming and inappropriate behaviour.
Stream+ currency: Twitch’s new currency announced at TwitchCon 2016, which will allow developers to integrate monetisation options directly into games.
Facebook Live has launched to much fanfare, and given the massive distribution channel it will always be a huge threat. However, until it can get to feature parity Facebook Live will need to rely on traditional media partnerships or viral hits to create consistent content. These types of partnerships don’t scale when we’re talking about the individual streamers and professional players that have played a large part in getting Twitch to 100m+ MAUs, although the signing of G2 and Heroes of the Dorm is a good first step. YouTube Gaming is farther along and is doing a great job of starting to launch some analogous features.
How, then, should publishers look to partner with entrepreneurs and third parties? I’d like to see publishers create a vehicle, individually or collectively, in the model of Disney Accelerator, to offer mentorship, funding and support to kick-start the next generation of eSports businesses. Publishers should be developing their games as platforms, not individual entities - tons of data are being generated and archived and there is a treasure trove of use cases for them.
I’m confident that we’re slowly moving in the right direction. One day we’ll see a truly open ecosystem with publishers and third parties living in harmony.
Former playing card maker Nintendo has managed to make its first profit in four quarters thanks to its mobile gaming division.
For those who came in late, like Nintendo, the game maker did not want to touch mobile gaming with a 10-foot barge pole because it would cannibalise its portable console market. However it looks like it was wrong.
However it warned that there might be trouble ahead as there are lower game downloads for its consoles.
Operating profit reached $284 million in October-December, which is 3.7 percent lower than the same period a year earlier but better than the cocaine nose-jobs of Wall Street expected.
For the year ending March, Nintendo cut its operating profit forecast by a third due to lower game software downloads for its consoles.
Nevertheless, projected income from investments and a weaker yen allowed it to almost double its net profit forecast.
In the nine months through December, the games maker said it earned $93,903,200 from mobile gaming, accessories and related merchandise, including from its first Nintendo-branded mobile game, Super Mario Run. The figure was up from $ 36 million in the same period a year earlier.
Super Mario Run, featuring the princess-rescuing Italian plumber, has reached about 78 million downloads since 15 December, Nintendo said.
But the game has also received a high number of reviews from users complaining mainly about its $9.99 one-time cost, with less than 10 percent of users paying to unlock all features. Most mobile games are free to play and charge small payments for special features.
Nintendo has said it plans to release around 3 mobile games a year, with two titles – Animal Crossing and Fire Emblem – planned for the coming months.
Still, it continues to regard mobile gaming primarily as a means of luring players to its mainstay consoles. Nintendo’s president, Tatsumi Kimishima, said at a news briefing on Tuesday that the games maker plans to move up production plans to meet orders.