Those who have been eagerly waiting for October to experience the latest adventures of Batman from developer Rocksteady, are going to be very disappointed to learn that the game will not make its originally announced October release.
Instead developer Rocksteady has confirmed that the game will be released in 2015. An exact release date has not yet been decided upon. We are hearing however, that as spring release for Arkham Knight is very likely.
While the exact reasons behind the delay were not announced, but the game is much bigger than previous Batman titles that Rocksteady has done and it is the first all next-generation title that the developer has done which also might be contributing to the delay. The game is still scheduled for release only on the Xbox One, PlayStation 4, and PC so the next generation status of the game has not changed.
The Samsung Gamepad is compatible with all Android phones running Android 4.1 Jelly Bean and above, though Samsung said that it is specifically optimized for Android 4.3 Jelly Bean and above. It features an eight-way D-Pad, two analogue sticks, four action buttons, two trigger buttons, a Select button and a Play button.
The Play button is a link to the Samsung App Store selling console optimized games at “reasonable prices”. The Gamepad uses Bluetooth 3.0, but can also pair via NFC and even cast gaming onto the big screen using Samsung Allshare. Although there are a number of Chinese imports available, this is the first time a major player has brought an Android game controller to the table.
Samsung said 35 games are available through the Play button at launch with more to come in 2014. Launch titles include Need for Speed: Most Wanted, Asphalt 8, Modern Combat 4, Virtua Tennis Challenge, and Prince of Persia. These are in addition to existing games from Google Play.
Samsung is keen to tout this new device as an alternative to buying a more expensive console such as an Xbox One or Playstation 4 (PS4), and while we’re not really sure if it can match them, we can certainly see the advantages of a device like this over Android game consoles such as the Ouya or Gamestick.
The device is already available for pre-order at Expansys for $125.99. At present there is no date attached to it, and Samsung is only committing to “the coming weeks” as the time-frame for availability.
As it’s a device with a steel casing, Samsung clearly is not aiming this at the budget market, and if its functionality matches its specifications, it could be one to watch in 2014.
The independent gaming scene has been growing by leaps of bounds, so it makes sense that the events designed to celebrate it are keeping step. This weekend’s IndieCade Festival in Culver City, California (on the West side of Los Angeles) is the largest in the event’s seven-year history. IndieCade founder and CEO Stephanie Barish said the event is expecting to draw more than 5,000 people to Culver City, which has a population around 39,000.
Much like the indie scene it promotes, the show has also been getting increased attention from the mainstream gaming industry of late. Sony has been a primary sponsor of the event for years, but the 2013 show sees Nintendo chip in for the first time, with Microsoft returning to the list after taking 2012 off. Activision is also on the list of sponsors, as well as Epic Games (for the Unreal Engine), Unity, and 20 more companies. Barish said some of the event’s more recent sponsors saw how Sony benefitted from its overtures to independent developers and have been following suit.
“[Sony has] put four or five years of effort now into the indie development sector and it’s really paid off for them,” Barish said. “Developers are really interested in meeting with them. They see there are possibilities, that Sony has proven [indies] can do well and are treated well. More and more the fact that independent games are interesting to a broader public is becoming apparent to the larger publishers. As well, there’s a huge creative energy and force and momentum coming out of the independent sector, and they don’t want to not be part of the future.”
That future is a big part of the attraction for IndieCade. Attendees to this year’s show will be able to try out a handful of games on upcoming hardware like the Oculus Rift and PlayStation 4. In all, IndieCade 2013 features 36 “official selections” for the festival, with dozens more games on show. Barish expects that crop of games to not only produce some of the next big hits, but also draw attention to the next crop of important developers. In the past, she said IndieCade has served as a coming out party for indie hits like Braid and Everyday Shooter, or developers like Telltale Games (who would go on to create the multiple Game of the Year award-winning The Walking Dead series). It’s also been a place to debut games that think outside the set-top box, like Johann Sebastian Joust, a six-player game that uses music and PlayStation Move controllers, but no screen.
“It’s really important for the mainstream to see what’s at the cutting edge, and we just continue to bring things in that are more cutting edge, that are more different than publishers or other mainstream things would even think to look at yet,” Barish said. “We’re really a window into what’s going to happen.”
Among this year’s selections are That Dragon, Cancer (a narrative-driven game set in a children’s hospital over three years), Perfect Woman (a “strategic dancing game” for the Kinect), and [code] (a PC game in which players delve into ersatz programming code to solve puzzles). While some of the IndieCade games will almost certainly prove to be lucrative for their creators, Barish stressed that isn't the only way to measure their success.
"There's definitely a desire for the Cinderella story, but having seen so many of the games, they're really good," Barish said. "So even if they're not commercially successful, they're impacting the way mainstream games are designed, the directions and the trends for those."
The trend for IndieCade looks to be continued growth. This year saw the event spawn an IndieCade East sister show in New York City, a second installment of which is confirmed for February 14-16, 2014 at the Museum of the Moving Image. Beyond that, Barish said there has been talk about expanding the festival even further with a European event.
Fans of traditional, “core” games are often extremely hostile towards the new wave of casual and mobile titles, and even towards the people who play them. They’re keen to draw a line in the sand between these titles and “real” games and quick to portray players of Farmville, Candy Crush Saga or Puzzle & Dragons as mindless consumers of low-grade, repetitive entertainment that’s utterly disconnected from and disrespectful of gaming culture and the medium’s development as a form of art and entertainment.
There are good discussions to be had around those topics – not Internet flame-wars, but some interesting if slightly dry academic discussions defining the form and shape of “gaming” as a pastime, a medium and an artform. If we’re very lucky, some of those discussions could even avoid becoming tedious tug-of-war sessions between the “narrative has no place in games!” crowd and the rest of the world. None of them, however, will gain anything from employing “casuals” as a vicious epithet, or deciding to sideline millions of game players as insignificant because they’re “fake” gamers who play the wrong kinds of game.
Why does this kind of knee-jerk unpleasantness get so consistently applied to new, more casual audiences? There are uncharitable explanations which often point to uncomfortable truths – self-styled “gamers” have built something of a boys’ treehouse over the years, and dislike the invasion of new demographics which can include such unwelcome treehouse guests as women, homosexuals, trans people, ethnic and religious minorities, and even – gasp! – their own mothers and relatives. Is nothing sacred?! There’s also a broader sense in which this is not specific to games at all – there’s a more universal knee-jerk reaction which sees adherents of any niche pastime resenting and rejecting the arrival of a mass-market audience and products tailored to them. (“Ugh, you listen to chart music? Are your ears broken?” “You actually like JJ Abrams movies? What’s wrong with you?”)
At the root of much of the dislike of casual games and their players, however, lies a more basic concern – a fear that the rise of this kind of game is going to replace and erase the sorts of games which existing gamers actually enjoy. Watching Clash of Clans or Candy Crush Saga roll in countless millions in cash is a deeply uncomfortable feeling for the kind of gamer who trekked for tens of hours across Skyrim, who can utterly lose themselves in the flooded corridors of Rapture or the dingy streets of Dunwall, or whose adrenaline pours out when they’re ambushed by the Covenant or surrounded by the Combine. If Candy Crush Saga can make so much money, is that the future? Is that all we’re going to be left with – if not thematically, then as a business model or a creative approach?
That’s the fear that drives the aggression. There’s a hobby which we love, and a wealth of creative works which have given us unforgettable experiences – gamers fear that the new business reality represented by F2P and casual games is an outright threat to that experience and that hobby. In the chase after the new casual audience, game companies will be forced to abandon the pursuit of the kind of experiences which enrapture and delight the existing audience – or at the very least, to turn them all into tawdry fairground toys which demand that you pump coins into them to keep on playing, robbing them utterly of the atmosphere and immersion which is so much of their appeal.
I wonder, then, if the atmosphere of discussion and debate around games might become a little more civil (on this topic, at least) in the wake of two fairly important events in the past week. Firstly, you can’t have failed to notice that GTA V came out and smashed through sales records not only for games, but for just about every entertainment media imaginable. Of course, week-one sales of games surpassed the revenue of blockbuster movies long ago, but GTA V cements games as the dominant entertainment medium of our era by finally silencing the last bastion of naysaying – not only did it make more money in a single weekend than the biggest films in the world make in their entire lifetime, it was also purchased and played by more people in one weekend than the number who bought tickets for any recent movie. Revenue or volume; count it how you like, GTA V is the biggest entertainment property on earth.
Meanwhile, in Japan, another entertainment property went on sale – Monster Hunter 4, Capcom’s latest release. Its figures don’t rival GTA’s, but in the supposedly “declining” Japanese games market, it sold over two million units in its first week and helped to drive hundreds of thousands of sales of the 3DS – a console that’s meant to be a miserable flop thanks to the unstoppable advance of smartphones and tablets. That can’t rival Apple’s 9 million unit sales of the iPhone 5S and 5C, of course, but then again, that’s not a remotely useful comparison, no matter how often blowhard mobile evangelists trot it out – the 3DS purchasers are all confirmed gamers who will go on to spend heavily on expensive game software, while only a certain portion of mobile phone owners play games, a much smaller portion pay any money for them, and the amount of money they pay can be quite small (or quite large, of course, but certainly rarely exceeding the spend of a console owner).
GTA V and Monster Hunter 4; two games which are absolutely squarely aimed at the core gamer who is presently so terrified of being squeezed out by the flood of mobile, casual and social software. Two games which, completely uncoincidentally, have just become the biggest entertainment properties in the world and in Japan over the past few weeks.
There is no threat here. There’s a small and dwindling clique of hardcore evangelists who will try to characterise GTA’s success in particular as an outlier, an erratic piece of data that doesn’t change the overall context of the industry, but they’re absolutely wrong. GTA’s enormous release is actually a perfectly logical and predictable continuation of a curve which has seen the top-rated properties in traditional gaming ranked higher and higher in sales terms over the past decade or two. GTA V is not a last gasp of sales success for a doomed industry; it was inevitable that eventually, a core videogame would achieve this level of sales success, and it is also inevitable that a future franchise will surpass this (although perhaps not for a few years, as the new console generation and the other systems which will play host to the next giant release need to establish themselves first).
Social, mobile and F2P gaming isn’t going anywhere. Developers are going to get better and better at creating and honing those experiences, targeting specific audiences and even creating experiences in those categories that appeal to core gamers – no question. But this isn’t the only way to make a game or to make money from games. There will still be a huge audience who want 8 to 12 hour long amazing narrative-driven interactive experiences. There will still be a core audience for combative multiplayer. Hardcore FPS, long-form RPG, exploration of vast worlds; all of these things have huge audiences which, far from being drawn away by the lure of Hay Day or Bubble Witch Saga, are continuing to grow and expand. Yes, the really impressive expansion right now is at the casual end of the market – but that doesn’t stop core games from selling even more than they used to, as this month’s success stories prove.
This isn’t a zero sum game, and everyone needs to stop talking and acting as though it is. As long as there’s an audience that wants and is willing to pay for core game experiences, there will be companies that provide for that need. Mums playing Candy Crush Saga outside the school gates do not in any way detract from the value of the market that wants a new GTA, a new Monster Hunter or any other core experience. This expansion is not be aimed at core gamers, and a big mistake being made by lots of companies now is trying to apply rational choice models to a fundamentally irrational consumer behaviour and deciding that core gamers actually SHOULD want this kind of business model or game experience. However, that mistake aside (and it’ll stop once a few companies get badly burned for their foolishness), this expansion also does not harm core gamers. Once they realise that, perhaps we can all tone down the rhetoric and instead enjoy the hegemony of videogames as, quite remarkably, this generation’s truly dominant entertainment medium.
The mobile and tablet market has grown tremendously in the last several years. The number of apps on Apple’s App Store and Google Play is downright mind boggling, and if you’re an app developer… well, best of luck to you. As the new survey from App Developer Conference organizers revealed this week, piracy and discoverability are making it incredibly hard to succeed. Nearly half of the app developers surveyed made no profit at all.
So the question has to be asked: after years of flocking to mobile, are developers actually retreating to the PC and console space? “I speak with lots of mobile devs regularly and most are moving away or at least thinking of it, either to other platforms or out of the trade completely,” Paul Johnson, managing director and co-founder of Rubicon, told us. “Having to give your game away for 69 cents a throw (after Apple’s and Google’s cut) and then competing with 1000 new apps each day is hardly a draw for anybody. We’ve reached a point now where even those slow on the uptake have realized the goldrush is over. It’s actually been over for a few years.”
Jeffrey Lim, producer, Wicked Dog Games, agreed: “The mobile space offers certain advantages, like having the largest customer base and relatively low development costs. However, there’s no doubt it is getting harder to be profitable with the ongoing piracy and discoverability issues.”
“So yes, we do think developers (especially indies) are considering going back to develop for the PC – and even game consoles. The cost of self-publishing on these platforms has dropped significantly, and console makers are also making their platforms more indie-friendly now,” he added, alluding to efforts on next-gen systems like Sony’s PS4.
Chillingo COO Ed Rumley isn’t quite of the same mind as Johnson and Lim, but as a publisher, Chillingo has noticed that too many developers simply are failing to make high quality games, so it’s no wonder that their titles are being ignored.
“The number of games being submitted is growing, as is the number of developers contacting us. I’m not sure if some are being scared away, but we know from experience that some developers underestimate the time and quality it takes to make it in mobile now. Consumers are a savvy bunch and spot second rate games a mile off. You can’t just knock something together in your spare time, upload it and wait for the money to roll in anymore,” he warned.
Michael Schade, CEO, Fishlabs Entertainment, acknowledged the big challenge in mobile, but he doesn’t think developers are going to have to look elsewhere.
“Sure, mobile’s not an easy market to breach into, but then again, which market really is? No matter what business you’re in or what product you’re trying to sell, you’ll always have to work hard to gain your ground and make a name for yourself,” he noted. “So that alone shouldn’t scare you away from mobile, especially when you keep in mind that no other platform in the history of digital entertainment has ever evolved faster and born more potential than mobile! With more than a billion smart connected devices in use and hardware capabilities on par with current-gen gaming consoles, today’s smartphones and tablets constitute by far the most widespread, frequently used and innovative gaming platform the world has ever seen.”
Schade also remarked that the last few years of veteran developers getting into the mobile scene has made things more difficult. “The fact that more and more established PC and console veterans open new mobile gaming studios and more and more traditional publishers port their titles to iOS and Android, doesn’t make it easier for one particular company or product to stick out. But that’s not necessarily a bad thing, as it clearly shows that the trend goes towards mobile, rather than away from it,” he said.
For every developer we spoke with, the discoverability issue reared its ugly head. There’s no doubt that this is a major concern. While building a high quality game can help, it’s simply not enough. In the world of apps, you cannot let the game do the talking for you.
“I think many developers have the misconception that it’s simply enough to release the game and let it speak for itself. They underestimate the importance of a marketing/PR campaign leading up to the game’s launch,” Lim stressed. “As a result their games fail commercially; not because of the quality, but due to lack of visibility. Hence the marketing/PR campaign should be seen as an integral part of the game’s development. An appropriate portion of the overall budget and effort should be allocated to increasing the game’s visibility, and if developers do not have the experience or time in marketing/PR they should consider hiring professionals in this area to lend a hand.”
Gree vice president of marketing Sho Masuda concurred that marketing is becoming crucial to mobile success. “They have to spend more time thinking about marketing and post-launch efforts in addition to building the the games. Fortunately, there are a lot of tools and services available for devs of all sizes to ensure that they can get the direction and support they need in these areas. Additionally, the mobile dev community is a very, very tight knit community and there is an amazing level of information sharing and support,” he said. “We encourage mobile devs of all sizes to talk to their peers, take advantage of all the meet-ups and events, and get to know all the services available to help get eyeballs on their games.”
A number of devs also believe that platform holders have a larger responsibility that they’ve been shirking so far. “For platform holders (e.g. Apple’s App Store), they can start to curate apps released on their store because there are too many clones of existing games that are taking up the traffic. They could attempt something like Steam Greenlight; although it is still an imperfect system, it’s better than not having any curation at all,” Lim commented.
Paul Johnson agreed, telling us that he’d really like platform holders to have a much more active role, as the discoverability issue has “about reached terminal” for unknown devs.
“If Apple don’t pick your game out for a feature, and you can’t drum up enough interest before launch yourself, then I’d say you’re pretty much screwed. It doesn’t matter how good your game is if nobody ever sees it and downloads it. They can’t tell their friends about something they themselves don’t know about!” he stated.
“The only thing I think the platform holders could do to help is stop allowing crap to be released. There’s only so much space for features and the end users only have so much effort in them to look under all the categories all the time, so I really don’t think adding more of them would help much. Maybe more apps for shorter times, but this is all a drop in the ocean really.”
“The one thing I’ve come up with that would make a real difference is for the platform owners to charge five grand for a developer license. All the utter crap would disappear and there’d be less apps fighting for space,” he continued. “And the end-users wouldn’t have to waste time downloading the crap as nobody who makes stuff they don’t believe in would dream of fronting that license fee. It’s Draconian but it’s really the only thing I can see having any noticeable effect. Anything else is just lip service.”
Discoverability issues aside, another major – and possibly growing – problem for devs to contend with is piracy. The App Developer Conference survey showed that 26 percent of devs had their apps pirated and a similar amount even had in-app purchases stolen.
James Vaughan told us, “Plague Inc. has a piracy rate of about 30-35 percent, which equals millions and millions of copies, but I don’t consider piracy to be a problem; it is simply a fact of life and I don’t get too worked up about it. Piracy is a byproduct of success and I choose to focus on the success which has resulted in piracy rather than the piracy itself. (The best way to stop your game from being pirated is to make a crap game!) I focus on continually improving and updating Plague Inc. which makes the game even more valuable to the people who have brought it (and encourages pirates to buy it as well).”
For those devs who actually do lose sleep over piracy, there are some ways to combat it, Lim said.
“There’s no question that piracy is prevalent, and I think it will continue to be so for a long time to come. In fact, with high-speed Internet access and the wide spread use of file-sharing software nowadays I think this problem is going to get worse,” he observed.
“The first way to deal with piracy is to implement the appropriate business model, and I think free-to-download with micro-transactions is the right way to go. Making the game free for download can work to our advantage; it allows us to reach out a larger customer base. And if players are hooked by the game, they can be enticed to buy additional high-quality content for a minimal price.”
“The second way would be to build a strong rapport with our customers – e.g. through frequent interactions on social media, events or even email. Developers of notable games (e.g. Hotline Miami and Game Dev Tycoon) have addressed piracy in this manner. By having a loyal customer base which is appreciative of our efforts in delivering quality content, they would empathize with us and be more willing to pay for the games in support of our development efforts.”
The good news for iOS devs, at least according to Schade, is that Apple’s store is less prone to piracy. “Having lived through the ‘dark ages’ of Java and made it out of there with two black eyes rather than one, piracy has been a very delicate topic for us at Fishlabs ever since. Based on our own experience, however, it is not as much of an issue on the App Store as it is on other platforms,” he noted. “I guess that’s mostly because Apple still has a lot of ‘premium’ customers willing to pay for high-quality content. Of course, we’re well aware of the fact that neither the closed iOS environment nor the Free-2-Play model will ever be able to eradicate software piracy entirely, but at least they are doing a comparatively good job at containing it as good as possible.”
If developers can effectively navigate the problems of discoverability and piracy, there’s no doubt that the potential is massive. One look at the overwhelming success of Angry Birds, Temple Run, Clash of Clans and others proves what’s possible. But for the vast, vast majority of devs, that’s a pipe dream.
“From the consumer angle, it’s a golden age. The amount of good quality games that can be bought for laughable prices is fantastic and there’s a ton of money being spent on this platform as a result. The problem for developers is that each individual cut is tiny. This isn’t even remotely sustainable and I don’t know what the future is going to look like. If I was starting again now from a blank slate, without an existing fan base, I wouldn’t touch mobile with a ten foot pole,” said Johnson.
In a “fireside chat” at Casual Connect, ex-EA CEO John Riccitiello sat down with journalist John Gaudiosi to talk about the state of the business.
Gaudiosi asked what Riccitiello thinks of the state of the industry today and who the winners are in mobile. “It’s shocking how long titles stay in the Top Fifty,” Riccitiello said. He also noted that there’s no publisher with broad, long-term success on mobile. “Most publishers have only one or two titles in the Top Fifty,” said RIccitiello. “Almost no one has a title with more than a year in the Top Fifty, and there’s never been a successful sequel.”
Riccitiello’s solution? “Mobile needs to build brands,” he said. “Madden is in its 25th year. So far there’s precious little to indicate mobile is building long-term brands.” The touchstone for Riccitiello is how well people do version 2.0 of a successful mobile game. Can publishers create brands that will last for multiple years? He feels that is going to be a key towards creating a valuable mobile publisher for the long term.
Gaudiosi asked what the role of a publisher is in mobile games, and Riccitiello said that’s still developing. Classically, he explained, publishers do three things: Provide capital, turn content into money (transactions), and provide editorial service. Mobile developers still need capital (especially as budgets increase), and help improving a game (both technical and design help) is always useful. What’s not clear, according to Riccitiello, is how helpful publishers can be in handling transactions when the platforms provide much of that mechanical assistance. The conversion of content into money is a mix of technology, marketing, and design, and mobile games are showing themselves to be different in many ways than games on other platforms.
What needs to change, according to Riccitiello, is the balance of revenue between the distribution platforms and the content providers. “For Apple and Google over the last five years, perhaps half or two thirds of their increase in shareholder value is directly from mobile products. That’s about $300 billion of capital created by the distribution platform,” said Riccitiello. On the other side is content. “Games are about 75 percent of all mobile app monetization; perhaps $25 billion of shareholder value has been created by content. That’s ten times more value created by the platform creator. That wasn’t the case in console.” Riccitiello feels that there’s great potential for game creators to change that equation and generate a lot more value from the content than from the platform.
Gaudiosi then asked Riccitiello what mobile can learn from console. “I’ve visited with many developers since I left EA,” Riccitiello said. “Many have told me they want to bring console level graphics to mobile, and that will make them better. I tell them investing in better graphics without a better game is a road to ruin.” Riccitiello feels that while mobile power is increasing, the rewards will go to developers that generate more satisfying games, not just better-looking games. “One bit of advice as you’re looking at more powerful mobile,” said Riccitiello. “Think about how that allows you to create an experience you haven’t seen before. What game mechanic wasn’t possible before?” Developers that find good answers to that question will do well.
Finally, Gaudiosi asked if Riccitello had any thoughts on how second screen gaming is impacting the business. “No one really knows the answer,” said Riccitiello. “I sit on my couch looking at my email, playing a game on console, and playing Candy Crush on my tablet. I’m using mobile screens all the time. I have seen some absolutely stupendous dual screen experiences with console and mobile. I don’t think we’re scratching the surface so much as we’re waving our hand above a surface that we’re yet to scratch.”
Riccitiello said that some of us would argue that all you need is a tablet or a phone and wireless HDMI out, but he disagrees. “TV is going be used for mobile games and dual screen will be a really big idea when you figure out a gameplay experience that is better.”
AT&T, the No. 2 U.S. mobile provider, is under pressure to improve its subscriber numbers as it loses market share to bigger rival Verizon Wireless, and smaller rivals like T-Mobile have started to compete more aggressively for its customers.
Market leader Verizon Wireless, a venture of Verizon Communications and Vodafone Group Plc , is also expected to offer a similar option to its customers in August, according to a Droid Life blog report. Verizon Wireless declined to comment.
Starting on July 26, AT&T customers could pay monthly installments for their phones or tablet computers and trade in their device for a new one every year. This compares with its previous requirement to stick with the same device for about two years in exchange for a discount.
The move was in direct response to recently announced plan by No. 4 U.S. mobile provider T-Mobile US under which its customers can upgrade their smartphones as often as twice a year.
AT&T and T-Mobile, which tried but failed to merge in 2011, are grappling to snare each others customers in a market where most people already have smartphones. T-Mobile has been directly marketing against AT&T in recent months.
Wells Fargo analyst Jennifer Fritzsche said in a research note that AT&T’s new option should be positive for the company.
“T-Mobile has clearly been seeing success with its version of this plan,” Fritzsche said, adding that much of T-Mobile’s success “has been at the expense of AT&T.”
But since both companies will be dependent on reselling the traded-in devices to help recoup their costs, Citi analyst Michael Rollins worried that they may lose money if there is a lot more availability of second-hand phones.
“The risk to AT&T and T-Mobile US is that the continued increase in supply for a secondary market for used devices could reduce the resale value and increase the cost of this program to any of the participating carriers,” Rollins said.
Smaller rival Sprint Corp, which was recently bought by SoftBank Corp, did not immediately respond to a request for a comment on the new options from its rivals.
AT&T said that under the new plan – branded AT&T Next – it will not charge an upfront device fee, unlike T-Mobile, but will instead charge customers $15 to $50 per month depending on the device.
It appears that the Ouya is going to be a bit delayed.
This is good news though, as it is being delayed because the console developers have more cash to spend on it, $15m more to be precise.
Ouya already raised around $7m on Kickstarter, and now, when it should be taking its last steps towards completion, it has had almost twice as much more injected into it by lovely venture capitalists.
We were expecting the console in early June, but that has slid back to 25 June. The time and money will in part be used to solve an issue with sticky buttons, something that usually only happens once consumers have taken some hardware home with them.
The money comes from venture capital firms and other companies including Kleiner Perkins Caufield & Byers (KPCB), Nvidia, Shasta Ventures, and Occam Partners. KPCB’s general partner Bing Gordon will join the Ouya board of directors as a result.
“We want Ouya to be here for a long time to come,” said Julie Uhrman, Ouya founder and CEO.
“The message is clear: people want Ouya. We first heard this from Kickstarter backers who provided more than $8 million to help us build Ouya, then from over 12,000 developers who have registered to make an Ouya game, next from retailers who are carrying Ouya online and soon on store shelves, and now from top pioneering investors.”
Gordon is in charge of digital investments at KPCB and is a veteran of the games industry, having started at Electronic Arts in 1982.
“Ouya’s open source platform creates a new world of opportunity for established and emerging independent game creators and gamers alike,” he said.
“There are some types of games that can only be experienced on a TV, and Ouya is squarely focused on bringing back the living room gaming experience. Ouya will allow game developers to unleash their most creative ideas and satisfy gamers craving a new kind of experience.”
Ouya consoles should start arriving in living rooms on 25 June. If you want one, you are going to have to come up with around $100 dollars, plus another $50 dollars if you want two controllers.
Ouya, the open Android-based console designed by Yves Behar, is being shipped to its Kickstarter backers today, and the company officially announced this week at GDC that it will hit retailers in the US, UK and Canada on June 4. Ouya is promising “hundreds” of titles for the June 4 release and the $99 console will be available at Amazon, Best Buy, GAME, GameStop, Target, and the store on OUYA.tv. Additional controllers will be sold for $49.99. And for digital purchases, consumers will be able to get pre-paid cards with redeemable codes at retail if they wish.
The company said that over 8,000 game developers worldwide are currently developing games, including both up-and-comers and more well known game makers like Square Enix, Double Fine Productions, Tripwire Interactive, Vlambeer, Phil Fish’s Polytron Corporation, and Kim Swift’s Airtight Games. “The majority of devs so far are experienced devs who’ve never built an Android game before. About 1 out of 5 have never even built a game before,” Ouya CEO Julie Uhrman said that at the GDC unveiling. She boasted that Ouya “already has more titles a couple months before launch than any console has ever launched with.”
The Ouya hardware itself is even smaller than we had previously thought (think Rubik’s Cube or smaller), and its sleek design and brushed aluminum is pleasing to the eye. Uhrman, however, stressed the controller more than anything else. “What we spent the most amount of time on is the controller. We really want this to be our love letter to gamers,” she said, adding that Ouya focused on the ergonomics, the weight, the feel, and wanted it to be a precise, accurate controller. “This is one of the pieces of Ouya that evolved a lot based on early supporter feedback,” she continued.
Apparently, the feedback led to numerous changes on the controller in terms of button placement, and the style of d-pad. The team found out that many preferred a cross-style d-pad than a disc because it’s superior for fighting games. Also, the engineers retooled the tension of the analogs and the design of shoulder buttons. And Ouya even made the responsiveness and speed of the center touch pad customizable. In this journalist’s hands, it felt comfortable and familiar while playing a few titles.
After showing off the hardware, Uhrman dived into the user interface of Ouya. The whole UI is incredibly streamlined, with four categories and an apps-like layout. The four categories are Play, Discover, Make, and Manage (which is for settings). Play is simply where anything you’ve downloaded – games or music or video apps – will be placed. Discover is the store, and it’s been designed to encourage people to “find the best games.” For example, sub-selections in Discover include featured channels like Go Retro, Hear Me, Genres, and Sandbox. The plan is to offer more descriptive names for games within genres.
“The way games get exposed in the genre list is based on what we call the O-rank, which is our fun algorithm. It’s how we rank great games. A lot of app platforms today use downloads as a metric or they use revenue as a metric and we don’t think that’s a good way to say if it’s a good game,” Uhrman said. “You could download a game and never play it again. And with the free-to-try model, revenue isn’t necessarily the best model either. What is [a good metric] is what proves that the game is fun, and that’s engagement. So things like how long you have played a game, how many times you’ve played that game over a certain period of time. How quickly from the time you boot up Ouya, which is an always-on device, do you play that game… It’s those types of engagement metrics that we think prove it’s a fun game.”
Another interesting area within Discover is Sandbox, which offers developers an opportunity to put builds up and ask people to thumb it up. The idea is for great games to get out of the Sandbox and be searchable and merchandized. It encourages developers to market their games and promote them to fans. Once you get out of Sandbox you know the people next to you have great quality games, Uhrman explained.
The Make channel is an area that appears to still be in flux. Uhrman said the goal is to serve two audiences, gamers and developers, equally. While Make is a place where a developer can upload early builds, over time it’ll be a place for devs to communicate with fans. “We also can grow it to be, what if you want to make a game, here’s how to market a game, etc. We’ll look to devs and gamers for feedback on how to evolve the section,” Uhrman said.
A console that’s as open as Ouya should have a fairly simple submission process for developers right? Uhrman confirmed that it’s not overly complicated and should be something most can complete within an hour. “It’s something we thought a lot about given that we’re an open platform… but we wanted to make sure that there are good quality games, at least to the extent that it was optimized to the television and for the controller. So the guidelines isn’t necessarily a quality review, but it checks if there’s malware, does it break or freeze often, does it use our controller schema in the right way, we need to make sure there’s no IP infringement, no pornography, does it elicit real-world violence, you are who you say you are kind of thing – that’s the review. We try to keep it under an hour. Developers can choose to go live immediately or they can choose a certain time,” she detailed.
Curiously, there’s been no partnership reached with the ESRB to rate the games in North America. Right now, the games will be self-rated by devs and community reviewed. Given that Ouya is being sold in mainstream retail, however, we do have to wonder if this will pose potential problems for the company in an atmosphere where some people are still pointing fingers at violent video games. “We’ll take it as it comes; right now we want to expose great content from any type of developer and we do have the thumbs-up/like feature or the report if this is abuse on the system,” responded Uhrman, adding that “We basically say that we can change the rules at any time and we can reject the game for any reason that doesn’t fit our content guidelines – we want everybody on Ouya to have a great experience.”
Ratings aside, one of the big questions surrounding Ouya is whether or not it can truly carve out a market for itself in the console space as industry veterans Sony and Microsoft prepare to launch their respective next-generation systems. The games we saw on Ouya are not graphically intense and are very indie in nature. Can Ouya handle high fidelity triple-A releases? Or does it even need to in order to get noticed?
Ouya does has a partnership with OnLive, so that’s one way to get triple-A games. “That’s one solution. We also support 1080p, hi-def… and we have a USB port so someone can add an external hard drive, so for games that are heavy you could absolutely use that. We have a max download size of 1.2GB for the first download, but as a developer if you want to add and send additional content from your servers you can,” Uhrman said.
“Traditional games take longer to develop, and we have some of those in development that we’re really excited about. Ouya is not about the number of polygons on the screen,” Uhrman acknowledged. “That’s not where we went. We wanted to have innovative and creative exclusive content, and we’re already starting to see that.”
Exclusive content plus a very appealing $99 price point is what could make the system an easy impulse buy for many gamers Uhrman believes. Moreover, Uhrman noted that most core gamers tend to purchase more than one console, so Ouya is likely to be something they’ll want to buy even if they are getting a PS4.
“Ouya offers something different; every gamer has a different expectation depending upon the platform and we believe we’re going to have innovative, creative games and exclusive games to Ouya… And the barrier to entry at just $99 where every game is free-to-try, I think opens up the opportunity for a number of gamers, even core gamers. Core gamers on average own more than one console. We don’t really think it’s an either/or situation. We’re offering something different – I think they’re going to want Ouya too,” she said.
A number of traditional consoles in the past have launched selling at a loss. Since Ouya is built with off the shelf components, it may be easier to contain costs, but Uhrman wouldn’t confirm that each unit is sold at a profit. “We’re really comfortable with our business model,” is all she would say.
That said, if things go the way Uhrman would like, this is only the beginning. Ouya will continue to evolve its software and hardware, and the hardware is likely to get refreshed quickly.
“We’re like any other software platform that iterates and grows over time, and we’ll have a hardware refresh rate more similar to a mobile refresh rate than a console refresh rate because we want to take advantage of the best chips out there and falling commodity prices. We will certainly make sure that there’s enough content that’s optimized for that chip and we don’t push on higher prices to the consumer,” she said.
Does that mean some Ouyas in future will not be compatible with certain games? Uhrman is looking to avoid that scenario. “We have a plan where all content will be compatible with future Ouya systems; we don’t want to fragment our own market for developers, and we always want gamers to have a great experience,” she commented.
Ouya will be interesting to watch. It’s a bold move for the industry and everything we’ve seen so far is completely unconventional. Whether or not that will pay dividends in the long-run is hard to judge at this point in time. “The market is calling us the ‘un-console’ and we like doing things the ‘un-way’,” Uhrman remarked.
Video game research firm EEDAR, which already has a proprietary database of over 100 million internally researched data points from more than 90,000 physical, digital, mobile, and social game products, is gearing up for the launch of a new service to assist mobile and social developers. EEDAR said that its new suite of mobile. Tablet and social products will aim “to improve sales potential and game quality for titles utilizing in-app monetization.”
EEDAR said that one of the most important things a developer can do is to optimize a game before launch. “EEDAR is able to provide an assessment at any point during the development cycle and accurately project key performance measurements of the final product, in addition to a qualitative assessment that provides feedback from the perspective of a professional game critic and consumers,” the company said about its new product suite.
Jesse Divnich, VP of Insights at EEDAR, to get an overview of the key takeaways from the firm’s research on the mobile and social markets. Divnich stressed that developers must be prepared with their in-game monetization strategy for retention and boosting conversion rates before a title is released into an app store.
“When the mobile game market was emerging, developers could optimize key monetization features after a game’s launch. The onboarding acquisition process had a long tail. Today, due to competition and larger consumer awareness, the time to peak engagement is rapidly shortening,” he noted.
“Facebook/Social games are a perfect example. Games like Farmville took nearly a year before they reached their peak users. It gave Zynga ample enough time to adjust game features to increase engagement monetization rates. Now, Social games are peaking within weeks and this idea of always being in ‘beta’ quickly shows its weaknesses when you are onboarding the majority of your lifetime users in only a few weeks,” he continued. “The mobile market is beginning to reach that point. Mobile games are making more headlines, consumers are becoming aware of hit titles faster. Simply put, consumers are engaging mobile games closer to a game’s release date and sleeper hits are becoming less prevalent.”
Even getting highlighted by Apple doesn’t mean what it used to. Developers can squander a great opportunity if they don’t make an effort to optimize. “Being featured by Apple no longer means weeks or months on the top charts. At most you have seven days and if your title is not fully optimized, you will leave money on the table,” Divnich added. “Going forward, developers must ensure they’re launching with maximum optimization, both from an artistic and scientific perspective. This means dedicating more resources to pre-launch analytics and qualitative testing.”
So what are some other notable mistakes developers are making? Well, mimicry certainly isn’t helping. Just because something works in one game doesn’t mean it can be successfully “borrowed” for a different game.
“There are still a large chunk of developers that are still too short-sighted. Clash of Clans has been a top seller for a few months and nearly 50 percent of the concepts and vertical slices that come across my desk in some way or another have an 80 percent overlap of Clash of Clans’ engagement loop. After we perform our assessments, some developers are disappointed to learn their retention, conversion, and monetization rates potential are a fraction of the results Clash of Clans has produced,” observed Divnich.
Even if your game is successful at the start, retention is a real problem, as it’s hard to create a game that has legs. “Competition within the mobile markets is at its fiercest, and every week there are at least seven high-quality releases trying to fight for our attention. The increase in competition, media coverage, and consumer awareness has driven down retention rates, for some genres, to dangerously low levels,” Divnich explained.
The key, he said, is to drive connectivity with a very attractive multiplayer component. “Right now, the tried and true method for improving retention has been multiplayer and social features. The correlation between retention rates and the inclusion of multiplayer and social features is ridiculously high,” Divnich noted. “We do issue caution, however. Just because games with strong multiplayer and social support sell well doesn’t mean slapping on a multiplayer component will automatically make your game a success.”
“We’ve seen this trend occur in the traditional HD gaming space. Call of Duty: Modern Warfare created a multiplayer frenzy and everyone thought by cuffing on a multiplayer component their game, too, would be a success. While it helped for some, those that tacked it on were met with lukewarm or disappointing reception. We still encourage our developers to implement new ways of approaching multiplayer and social features, but how they are implemented is key to improving retention rates,” he continued.
While the mobile/tablet space is getting all the attention these days, and social gaming on Facebook has seen sharp declines, that doesn’t mean developers should automatically ignore the social space. There can be opportunities there as well, especially if developers optimize their titles.
“The social platform is still viable and profitable for many developers,” Divnich remarked. “Two years ago developers were fanatic about releasing on the social platform, but they oversaturated the market. There was too much choice in a market, there were no switching barriers for consumers, and there existed too many rip-offs of the standard Farmville or Bejeweled engagement loop. Additionally, Facebook couldn’t keep up with the demand for innovation. Being a platform where consumers violently resist change (e.g. Timeline), it’s difficult to support new tools and back-end features for developers without changing the whole experience altogether.”
“Developers can still be profitable on social platforms, but we certainly approach that space more cautiously,” he concluded.
There is no “perfect answer” to doing business with video games. Let’s call a halt to the pointless “zero-sum” debates that blighted 2012
A day in which you learn nothing is a day wasted; by which standard, a year in which we learned nothing would be a pointless waste of time indeed. It’s worth, as 2012 draws to a close (all that’s left now is the few days of indulgence before the year, in harmony with our waistbands, croaks its last), thinking about what we’ve learned. What did 2012 teach us that we did not before? Never mind, for a moment, the money we earned or lost, the games we played or made; did we grow? Did we advance? Did we learn?
From a business standpoint, certainly, we learned a great deal. 2012 cemented the place of mobile in the gaming ecosystem, forcing all but the most ardent refuseniks (so Nintendo and… er… that’s about it) to recognise mobile as an important part of their business – and even those who were slow to react to the rise of mobile gaming seem determined not to be left behind as tablets gain steam, with 2012 having shown us pretty clearly that the iPad and its myriad imitators are on track to become the primary data device of many consumers in the coming years.
We also learned some things – although not enough, I reckon – about where price points are heading. Freed of the artificial barriers to entry which define console platforms and physical retail, the App Store and Google Play have shown us where prices for digital content will inevitably trend towards – zero. In 2012, more entertaining, successful games than ever before launched at the princely price point of absolutely nothing. Plenty of others didn’t debut at far above 99p, and several of my favourite games of the year would have given me change from a £10 note. Free to play, with all that it entails, remains in its infancy, but is clearly going to be with us for the long haul; hopefully 2013 might be the year when the industry stops having ill-tempered hissy fits about this fact, and starts engaging with making F2P work better rather than loudly and pointlessly damning or exalting it at every turn.
That, perhaps, is a reasonable lead-in to something that I don’t think we learned this year, as an industry – we didn’t learn to stop being afraid of zero-sum games that don’t really exist. Discussions about mobile gaming, even among supposed professionals and experts, often descend into abject ridiculousness due to an insistence that mobile games will come to replace all other kinds of games, or that they are doomed to be a cynical, low-quality niche – neither of which position stands up to the slightest moment of intellectual scrutiny. The same applies to the vitriolic arguments about free-to-play which have washed over and back across 2012 like a stinking, polluted tide – when one side insists that everything will eventually be F2P, and the other insists that F2P is intrinsically evil and wrong, you’re no longer dealing with professional debate, but with dumb fanaticism.
I’m not saying, by the way, that we should all be cautious fence-sitters – there’s no virtue to sitting on the fence simply because it’s comfortable. Strong beliefs are good, but meaningless unless tempered by reason and fact. The fact is that cinema did not kill theatre, television did not kill cinema, video games have yet to viciously murder books, home recording did not kill music and video did not kill the radio star. Media and entertainment industries are ecosystems that accommodate an extraordinary range of different kinds of product and different business models – and that is not ever going to change. The idea that one form of entertainment, one form of business model or even one form of distribution will emerge to Rule Them All, is simply an idiot’s fantasy.
I say that with absolute confidence, not just because it is supported by countless years of history and the sheer wealth of culture and entertainment they have bequeathed to us, but because I recognise where the belief springs from. It’s the unique curse and blessing of the games industry that it teems with “left-brained” people – logical, analytical, mathematical, and quite different from the “right-brained” people who often dominate other creative industries. Video games were born with both feet firmly in the sphere of technology, only gradually moving to straddle the worlds of both technology and art – a marriage which is superbly creative but often fraught, as evidenced by the hissing recoil of many gamers and industry types alike when presented with the (stonkingly obvious) fact that games are an artform.
Left-brain people (yes, modern psychology dismisses this terminology, but it’s so much more polite than grouping you all as “geeks” and “arty types”, isn’t it?) love perfect answers. They like problems which have a correct solution, and see the world in those terms. In many industries, they’re perfect business leaders – there absolutely is a single most efficient way to extract oil or metal from the ground, to build an aircraft, to lay out a road or rail network. In entertainment, though, the idea of a “perfect” solution runs into a huge set of problems which utterly stump the left-brained – sentiment. Emotion. Irrationality. Sheer outright bloody-mindedness.
The fact is – nobody needs entertainment. Not really. If video games, films, books, music, plays, TV shows, paintings and sculptures all disappeared tomorrow, we’d be a much diminished species, but nobody would die. People need shelter, food, clothing, transport, protection, fuel – but entertainment is “discretionary”. It says so right there in your accounts. It’s spending at your discretion – and what that means is that it’s spending guided not by optimisation, but by sentiment.
Is free-to-play the most efficient way for money and experiences to change hands between developer and player? Is mobile or tablet gaming the most cost-effective route for consumers to engage with video games? Yeah, maybe – but what so few of us seem to really grasp is that this doesn’t actually matter. Is MP3 music the perfect balance of quality, convenience and file size? Probably – but vinyl shops thrive and specialist services offering “lossless” quality music files are on the rise. Is Kindle the best way to consume books? Yes, undoubtedly – but I don’t think of myself “consuming” books. Some books I just read; some I own; some I treasure. Sentiment; emotion; irrationality. I went to a shop and bought a leather-backed volume of a book I already own in paperback and Kindle alike. I’ll probably never read it. I love it. Am I an idiot, failing to see that this is not the optimal consumption path and bound to realise the error of my ways eventually? No, because this is my discretion; this is how I choose to enjoy and to spend on my pastime.
That’s why the zero-sum game will never come to pass – not as the strident debaters of 2012 believed. A very large number of consumers will still want things like dedicated gaming hardware, expensive full-price releases and physical products, not because this makes “sense” in an economic or logical way, but because they love those things and because, beyond straightforward questions of affordability, “economic sense” isn’t a welcome guest in deliberations about your hobbies and your passions.
The industry evolves and changes – never as rapidly as it did in 2012, though 2013 will probably make our heads spin just as fast – but little is truly lost. We don’t sell petrol, or sliced bread, or concrete, or train tickets. We sell experiences and emotions, and people will choose to consume those in the way that makes them feel best, not the way that is most coldly, mathematically efficient. Nobody fears that releasing Shakespeare adaptations on DVD will shut down theatres, or that allowing buskers onto the streets will eventually lead to concert halls being demolished. It’s time that we, too, learned that the expansion of the games business leads to more opportunities and more diversity, not to an existential threat to things we love – or worse, a chance to gloat over the imagined demise of things we hate. If you’ve got one new years resolution to make for 2013, make it this one – no more zero-sum arguments. Mobile won’t kill console. F2P won’t kill full-price. Cloud won’t kill local. The forest grows ever bigger; the old tree doesn’t block the sunlight from the new trees, the new trees do not strangle the roots of the old.
The studio, which will be run under the Microsoft Studio’s banner, will report into Phil Harrison, corporate VP of Microsoft’s Interactive Entertainment Business in the EMEA region, and will have a focus on developing for Windows 8 tablets. Apparently because, well, someone has to.
“I’m hugely excited by this new venture,” said Schuneman. “Adding a fourth UK based studio to the incredible roster of talent already in place across Rare, Soho Productions and Lionhead not only increases our in-region studio presence, but will allow Microsoft Studios to explore the many creative and business opportunities that developing new games and entertainment experiences on Windows 8 tablet devices and platforms will afford.”
Schuneman will not be the only person working there of course, and Microsoft said that it is running a recruitment drive for other staffers. Anyone that is hired will work on “entertainment as a service” releases, which should fun, and focus on the aforementioned Windows 8 on tablets.
Work at the studio is expected to start in November.
The NPD Group has sent its August retail sales report for the US market, and once again it was not a pretty sight, as total industry sales dropped 20 percent to $515.6 million. Total software sales (including PC retail software) dropped 11 percent to $252.8 million while hardware sales declined a sizable 39 percent to $150.6 million. Accessories were also down seven percent to $127.3 million.
“The current hardware systems are showing their age, so it goes without saying that it would be great to have new systems breathe life into traditional retail industry sales,” said NPD industry analyst Anita Frazier. “I am anxious to learn more about the Wii U launch later this month. And with any luck we will hear news about other systems on the horizon.”
While software sales weren’t good, Frazier noted some encouraging news about the market starting to stabilize.
“Within software, the high definition platforms posted only a slight 1 percent decline in dollar sales as compared to last August, pointing to a stabilization in that portion of the retail market for games content,” she said.
“One factor contributing to the softness we have seen in retail content sales so far in 2012 has been the decline in the sheer number of new titles. This, however, was not the case in August because there were more new titles when compared to last year; titles with sales that were significantly better than last year’s launches. So, what we’re seeing impact August results is the domino effect of the light release schedule from earlier in the year. That lack of new releases has had a significant impact on subsequent month’s sales,” she continued.
As NPD now does every month, the firm reminded us that this report is only one piece of the total games industry revenue pie.
“These sales figures represent new physical retail sales of hardware, software and accessories, which account for roughly 50% of the total consumer spend on games,” Frazier noted.
“When you consider our preliminary estimate for other physical format sales in August such as used and rentals at $104MM, and our estimate for digital format sales including full game and add-on content downloads including microtransactions, subscriptions, mobile apps and the consumer spend on social network games at $391MM, we would estimate the total consumer spend in August to be $989MM. Our final assessment of the consumer spend in these areas outside of new physical retail sales will be reported in November in our Q3 Games Market Dynamics: U.S. report.”
“The CPU and GPU capabilities of mobile devices will reach Xbox 360 levels of graphical fidelity and processing power within the next generation,” Canessa said.
“Activision will be creating a mix of casual and immersive gaming experiences on mobile, but as I say smartphones are more and more allowing for us to create those kinds of experiences. The games that Activision publishes on console, the games it publishes on PC, pretty soon we’ll be publishing those kinds of experiences on tablets and smartphones.”
Canessa explained that Activision is all-in when it comes to mobile development and is bringing some of its biggest IP to the table.
“We have about 350 different brands and IPs to work with. That’s legacy IP, that’s triple-A IP and that’s licences with other companies. We want to create mobile games from all of these aspects of the Activision portfolio, and build a variety of experiences,” he said.
“I would definitely say that one of our competitive advantages is the strength of our brands. The creation of new IP is expensive, and when you consider how much money we spend on marketing our IP, we can apply that halo effect to our mobile properties. You are going to continue to see us take advantage of our big marketing campaigns to help our mobile products too.”
Activision is also betting big on mobile development talent in the UK.
“What I will say is that we are in the UK to hire the best talent in the mobile space. If you look at the UK development community, some of the world’s best handheld and mobile game developers are there. That’s the talent we want to hire.”
According to The NPD Group, US games business continued its downward slide for 2012 during the month of July. Total game industry sales diminished 20 percent to $548.4 million and software sales (including PC) were down 23 percent to $278.2 million.
“These sales figures represent new physical retail sales of hardware, software and accessories, which account for roughly 50 percent of the total consumer spend on games. When you consider our preliminary estimate for other physical format sales in July such as used and rentals at $117MM, and our estimate for digital format sales including full game and add-on content downloads including microtransactions, subscriptions, mobile apps and the consumer spend on social network games at $439MM, we would estimate the total consumer spend in July to be $1.1B,” said NPD industry analyst Anita Frazier.
“Our final assessment of the consumer spend in these areas outside of new physical retail sales will be reported in November in our Q3 Games Market Dynamics: U.S. report.”
While July was a down month in what has been a down year, Frazier says there’s reason to be optimistic in the near term.
“Looking forward to August, the launch of the 3DS XL coupled with New Super Mario Bros. 2 should bring a nice boost to the performance of the new physical retail channel. While August is typically ‘Madden Month’, Madden NFL ’13 launches on August 28th which falls into the September reporting period. So, like last year, Madden will impact September results instead of August,” she said.
“New physical retail sales of games hardware, software and accessories traditionally follows a very reliable seasonality pattern. Based on year to date sales, and taking into account the release slate for the back five months of the year as well as the anticipated launch of the Wii U, annual sales for the new physical channel should come in around $14.5B for the year.”
Hardware shrunk 32 percent year-on-year to $150.7 million and Frazier noted that it affected almost every piece of hardware across the board.
“Of the hardware platforms that were on the market last July, only one, the 3DS, realized a unit sales increase over last year. Both the DS and the 3DS, however, realized a month-over-month unit sales increase over June 2012 while the other platforms declined,” she said.
As expected, NCAA Football 13 was the leading seller for the month that saw few new releases. Lego Batman 2: DC Super Heroes, The Amazing Spider-Man and Batman: Arkham City were all in the top five, showing the boost the Summer movies The Amazing Spider-Man and The Dark Knight Rises are giving to their complementary video games. Just Dance 3 reentered the top five at number four, while Diablo III (a top seller the past two months) fell completely out of the top 10.
“On a SKU ranking, Pokemon Conquest is among the top 10 in sales for the month of July,” noted Frazier. “The top ten games ranking includes several games that launched a number of months ago such as Batman Arkham City and Dead Island, which both received a boost in sales due to the release of Game of the Year editions. Looking forward to August, besides the launch of New Super Mario Bros. 2 for the 3DS, it will be interesting to see the performance of Sleeping Dogs which is new IP that has garnered a fair amount of buzz.”
Accessories are bucking the overall trend of the industry, up 8 percent to $136.9 million.
“Accessories was the only category up in both dollars and units for the month, driven by increases in points and subscriptions game cards as well as the Skylanders character packs,” she said. “Between the characters that are packaged with the Skylanders game and the sales of the separate character packs, over 25 million individual Skylanders figures have been sold through at retail in the U.S. since the launch of the game in October 2011.”