It’s been more than five years since The NPD Group said it would start including digital data in its monthly reports on the US video game business. In those five years, not only has digital grown, but publishers, analysts, press and more have all thrown shade at NPD, questioning the relevancy of a service that only offers physical sales data in an increasingly digital era. Today, NPD is finally taking that first step to offer a more complete picture of the entire games market as it’s unveiled its digital point-of-sale (POS) sourced service, tracking SKU-level sales data on digital games.
“Following several years of beta testing, the Digital Games Tracking Service will allow participating clients to understand the size and growth of the digital market, and analyze attach rates and other important metrics. Combined with physical data available by NPD, these clients can gain a better understanding of the interplay between the physical and digital sales channels,” the firm explained in a press statement.
“As has been experienced across a wide variety of industries, digital has made a big impact on the overall gaming market, and we’ve risen to meet the demand for a reporting mechanism that tracks those sales in a timely and accurate way,” said Joanne Hageman, President, U.S. Toys & Games, The NPD Group. “With the participation and support of leading publishers – whose cooperation makes this possible – we are excited to launch an industry-first service that addresses a long-standing need.”
The usual report on physical sales data will now be combined with digital sales data and issued on July 21 instead of July 14; it’s expected to follow that cadence (the third data Thursday of the month) moving forward. Initially, NPD has gained the support of major publishers like EA, Activision, Ubisoft, Capcom, Square Enix, Take-Two, Deep Silver and Warner Bros. There are notable exceptions, however, like Bethesda as well as first-party publishers like Microsoft, Sony and Nintendo, but NPD analyst Liam Callahan promised that more publishers would be signing on as the service evolves.
“This has been several years of beta testing and we’ve been doing this in partnership with publishers, shaping the product, encoding the data the way the industry wants to see it. It’s really at the behest of or on the behalf of the publishers that we’re moving forward with this announcement… Really the goal is to bring a new level of transparency never before seen, at least in the US market. This is really the first step. We recognize that there’s still a ways to go, we want more publishers to join, we want to be able to project for people who are not participating. It’s an evolution, it’s something that takes time and our philosophy was really to start – if we waited to have every publisher in the world to sign up it would take forever. We’ll be improving this as time goes on,” he said.
Importantly, NPD will notate next to game titles on the chart that do not include digital data. Callahan wants the service, which is being produced with the assistance of EEDAR, to ultimately be able to project data even for non-participants but NPD isn’t starting with that ability just yet. Instead, it’ll focus on tracking revenue from full-game downloads across Xbox Live, PlayStation Network and Steam. Services like Battle.net and Uplay won’t be included at this point.
“EEDAR is excited to be part of this initiative with NPD and the participating publishers. Tracked digital revenues have seen annual growth of over 100% each year since 2012. In 2016, we’ve already tracked more digital revenue than we saw in 2012 and 2013 combined. This initiative is a great milestone for the industry which will allow publishers to make better business decisions with a broader data set,” added EEDAR CEO Rob Liguori.
Add-on content like DLC and microtransactions will be tracked as well, but that data will only be released to participants, not the media and public. “We’re waiting until that’s a little more fully baked for us to roll that out to the media. We’re doing things in stages,” Callahan said.
It may be frustrating for the media to not have a granular breakdown at the SKU level to see what portion of a game’s sales are digital versus physical, but NPD anticipates more openness as the service evolves.
NPD communications chief David Riley commented, “This is a closed service, the detailed data is only available to participants so if you’re a non-participating publisher you cannot see the data. The fact that we’re allowed to go out with something for the media is a huge step in the right direction. I think as the service matures and as the publishers get used to it and we get more on board, we have more history, we do some benchmarking, we can provide that, but what we wanted to do for multiple reasons, including appeasing the publishers was to combine full-game physical with full-game digital, keep away from the DLC, keep PC games separate because that’s a whole different ball of wax. It’s not comprehensive, but it’s the most comprehensive, we’re the first in the market to track this and we’re sort of very cautious.”
He added, “I expect a good old slamming from the industry press because of the limitations here but what we don’t want to do is open ourselves up by separating it at this time. We’ve just opened the gates right now. Just as you’ve seen a withdrawal [of data] on the physical side – we used to give units – this is sort of going to be the reverse I’m hoping and we can provide more over time.”
Working with the publishers is great, but there are numerous digitally released titles from indies which make up a growing piece of the industry pie. Will the service grow to track those titles too? “Indies are a big part of the industry in terms of their innovation and I think when I talk about our projection methodology and assets at NPD, that is part of how we can track everything, not just for publishers, including indie games and everything that’s outside the panel right now,” Callahan said.
“Some of those smaller games are published through a publisher or first-party so there are ways to get some of those with our publisher-sourced methodology, and otherwise we’re approaching it with developing a robust projection methodology. That’s certainly part of our plan, we’re not going to ignore the indie piece.”
In our previous conversations with NPD, the firm had hinted at possibly working towards the goal of global digital reports. That’s not off the table, but it’s not a focus at the moment. “US is our core competency… our vision is to expand this as much as we can in a way that makes sense for our partners. If that’s global that may be what we pursue. But we also want to do the best job that we can in projecting for the market and recruiting as many publishers as we can,” Callahan concluded.
AMD and Nvidia fanboys are expected to battle each other to death as AMD readies to launch its new Polaris-based Radeon RX 480 graphics card.
Using the traditional weapons of made-up facts and faulty historical memory, which are targeted with no sense of perspective, the fanboys should occupy their time for at least another year.
Although this is not the goal of the new AMD launch, the fact that Nvidia has decided to start selling its GeForce GTX 1060 products, which were originally set to launch in August to match the card indicates that a war of some sort is afoot. Fanboys are usually sensitive to these things.
AMD’s company vice president Raja Koduri said AMD was ready to release its Radeon RX 480 priced at US$199 on 29 June. The outfit’s FreeSync technology has also seen increased adoption by graphics card players recently who need a cheap sink. This has raised AMD’s share in worldwide PC discrete graphics card market to close to 30 per cent in the first quarter.
It looks like AMD is charging ahead into the mid-range and mainstream sectors. This is probably the reason Nvidia has moved forward the releases of GeForce GTX 1060 products by a month and is likely to reduce their prices to make them more competitive.
Nvidia is hamstrung by the fact that there are still a lot of GeForce GTX 960/950 graphics cards in the channel and Nvidia’s sudden change of plans forced graphics card players to turn to focus on new products instead of clearing inventory.
It is not clear who will be the Ramsay Bolton and who will be the Jon Snow in this particular battle off the bastards. But let the strawmen be unleashed and the biting sarcasm begin.
While Sony wowed gamers at its E3 press conference this year with a barrage of impressive content, some would argue that it was Microsoft that made the biggest splash by choosing its press conference to announce not one, but two distinct console hardware upgrades that would be hitting the market in consecutive years (Xbox One S this year, Scorpio in 2017). Years from now, this may be the grand moment that we all point to as forever changing the evolution of the console business. Sony, too, is preparing a slight upgrade to PS4 with the still-to-be-unveiled Neo, and while it won’t be as powerful as Scorpio, it’s not a stretch to assume that Sony is already working on the next, more powerful PlayStation iteration as well. We can all kiss the five or six-year console cycle goodbye now, but the publishers we spoke to at E3 all believe that this is ultimately great for the console industry and the players.
The most important aspect of all of this is the way in which Sony and Microsoft intend to handle their respective audiences. Both companies have already said that players of the older hardware will not be left behind. The ecosystem will carry on, and that to EA global publishing chief Laura Miele is a very good thing, indeed.
“I perceive it as upgrades to the hardware that will actually extend the cycle,” she told me. “I actually see it more as an incredibly positive evolution of the business strategy for players and for our industry and definitely for EA. The idea that we would potentially not have an end of cycle and a beginning of cycle I think is a positive place for our industry to be and for all of the commercial partners as well as players.
“I have an 11-year-old son who plays a lot of games. We changed consoles and there are games and game communities that he has to leave behind and go to a different one. So he plays on multiple platforms depending on what friends he’s playing with and which game he’s going to play. So the idea that you have a more streamlined thoroughfare transition I think is a big win… things like backwards compatibility and the evolution,” she continued.
“So it’s not my perception that the hardware manufacturers are going to be forcing upgrades. I really see that they’re trying to hold on and bring players along. If players want to upgrade, they can. There will be benefit to that. But it’s not going to be punitive if they hold on to the older hardware… So we’re thrilled with these announcements. We’re thrilled with the evolution. We’re thrilled with what Sony’s doing, what Microsoft’s doing and we think it’s phenomenal. I think that is good for players. It’ll be great for us as a publisher about how they’re treating it.”
Ubisoft’s head of EMEA Alain Corre is a fan of the faster upgrade approach as well. “The beautiful thing is it will not split the communities. And I think it’s important that when you’ve been playing a game for a lot of years and invested a lot of time that you can carry on without having to start over completely again. I think with the evolution of technology it’s better than what we had to do before, doing a game for next-gen and a different game from scratch for the former hardware. Now we can take the best of the next console but still have super good quality for the current console, without breaking the community up. We are quite big fans of this approach,” he said.
Corre also noted that Ubisoft loves to jump on board new technologies early (as it’s done for Wii, Kinect, VR and now Nintendo NX with Just Dance), and its studios enjoy being able to work with the newest tech out there. Not only that, but the new consoles often afford publishers the opportunity to build out new IP like Steep, he said.
“Each time there’s a new machine with more memory then our creators are able to bring something new and fresh and innovate, and that’s exciting for our fans who always want to be surprised. So the fact that Microsoft announced that they want to move forward to push the boundaries of technology again is fantastic news. Our creators want to go to the limit of technology to make the best games they can… so the games will be better in the years to come which is fantastic for this industry. And at Ubisoft, it’s also in our DNA to be [supportive] early on with new technology. We like taking some risks in that respect… We believe in new technology and breaking the frontiers and potentially attracting new fans and gamers into our ecosystem and into our brands,” Corre continued.
Take-Two boss Strauss Zelnick pointed out the continuity in the communities as well. “The ecosystems aren’t shifting as much. We essentially have a common development architecture now that’s essentially a PC architecture,” he said. And if the console market truly is entering an almost smartphone like upgrade curve, “It would be very good for us obviously. To have a landscape…where you put a game out and you don’t worry about it,” he commented, “the same way that when you make a television show you don’t ask yourself ‘what monitor is this going to play on?’ It could play on a 1964 color television or it could play on a brand-new 4K television, but you’re still going to make a good television show.
“So we will for sure get there as an industry. We will get to the point where the hardware becomes a backdrop. And sure, constantly more powerful hardware gives us an opportunity but it would be great to get to a place where we don’t have a sine curve anymore, and I do see the sine curve flattening but I’m not sure I agree it’s going away yet… That doesn’t change any of our activities; we still have to make the very best products in the market and we have to push technology to its absolute limit to do so.”
Sony Pictures Animation has announced that it will produce an animated movie about “the secret world of our phones and the beloved characters that have become daily necessities in global interpersonal communication.”
“Emojimovie: Express Yourself” is due in August 2017. It will be written by Eric Siegel and Anthony Leondis and directed by Leondis. He previously wrote and directed “Lilo & Stitch 2: Stitch Has a Glitch” and “Igor.”
Deadline had earlier reported that Sony beat out two other movie studios bidding for the movie, paying “near seven figures” for the title.
So what emojis might make the cut and appear in the movie? The smiley seems the likely star and is the most-used emoji in every country except France, according to a SwiftKey study published in 2015. In France, the heart emoji is the favorite.
Emojis first appeared on cell phones in 1999 when NTT DoCoMo launched its i-Mode wireless Internet service in Japan. Since then, they have spread worldwide and are available on all modern smartphones, messaging systems and computers.
Emojis’ Japanese roots explain some of the stranger characters, which might mean little to people in the West but related to some important cultural festivals, food or other aspects of Japanese life.
E3 2016 has officially come to a close, and despite the fact that Activision and EA were absent from the show floor, my experience of the show was that it was actually quite vibrant and filled with plenty of intricate booth displays and compelling new games to play. The same cannot be said for the ESA’s first ever public satellite event, E3 Live, which took place next door at the LA Live complex. The ESA managed to give away 20,000 tickets in the first 24 hours after announcing the show in late May. But as the saying goes, you get what you pay for…
The fact that it was a free event, however, does not excuse just how poor this show really was. Fans were promised by ESA head Mike Gallagher in the show’s initial announcement “the chance to test-drive exciting new games, interact with some of their favorite developers, and be among the first in the world to enjoy groundbreaking game experiences.”
I spent maybe an hour there, and when I first arrived, I genuinely questioned whether I was in the right place. But to my disbelief, the small area (maybe the size of two tennis courts) was just filled with a few tents, barely any games, and a bunch of merchandise (t-shirts and the like) being marketed to attendees. The fans I spoke with felt like they had been duped. At least they didn’t pay for their tickets…
“When we found out it was the first public event, we thought, ‘Cool we can finally go to something E3 related’ because we don’t work for any of the companies and we’re not exhibitors, and I was excited for that but then we got here and we were like ‘Uh oh, is this it?’ So we got worried and we’re a little bit upset,” he continued. Malcolm added that he thought it was going to be in one of the buildings right in the middle of the LA Live complex, rather than a siphoned off section outside with tents.
As I walked around, it was the same story from attendees. Jose, who came with his son, felt similarly to Malcolm. “It’s not that big. I expected a lot of demos, but they only had the Lego Dimensions demo. I expected something bigger where we could play some of the big, upcoming titles. All it is is some demo area with Lego and some VR stuff,” he told me.
When I asked him if he got what he thought would be an E3 experience, he continued, “Not even close, this is really disappointing. It’s really small and it’s just here. I expected more, at least to play some more. And the VR, I’m not even interested in VR. Me and my son have an Xbox One and we wanted to play Battlefield 1 or Titanfall 2 and we didn’t get that opportunity. I was like c’mon man, I didn’t come here to buy stuff. I came here to enjoy games.”
By cobbling together such a poor experience for gamers, while 50,000 people enjoy the real E3 next door, organizers risk turning off the very audience that they should be welcoming into the show with open arms. As the major publishers told me this week, E3 is in a transitional period and needs to put players first. That’s why EA ultimately hosted its own event, EA Play. “We’re hoping the industry will shift towards players. This is where everything begins and ends for all of us,” said EA global publishing chief Laura Miele.
It seems like a no-brainer to start inviting the public, and that’s what we all thought was happening with E3 Live, but in reality they were invited to an atmosphere and an “experience” – one that barely contained games. The good news, as the quickly sold out E3 Live tickets indicated, is that there is a big demand for a public event. And it shouldn’t be very complicated to pull off. If the ESA sells tickets, rather than giving them away, they can generate a rather healthy revenue stream. Give fans an opportunity to check out the games for a couple days and let the real industry conduct its business on a separate 2-3 days. That way, the ESA will be serving both constituents and E3 will get a healthy boost. And beyond that, real professionals won’t have to worry anymore about getting shoved or trampled, which nearly happened to me when a legion of frenzied gamers literally all started running into West Hall as the show floor opened at 10AM. Many of these people are clearly not qualified and yet E3 allows them to register. It’s time to make E3 more public and more professional. It’s your move ESA.
We asked the ESA to provide comment on the reception to E3 Live but have not received a response. We’ll update this story if we get a statement.
At its E3 2016 press conference today, EA said that DICE and Motive were working on a new version of Star Wars: Battlefront for release in 2017. Visceral Games are creating an action-adventure game with an “original narrative set in the Star Wars universe with all-new characters.”
Respawn Entertainment is developing “a different style of gameplay” which takes place in a different timeline we have yet to explore with our EA Star Wars titles.” In other words, almost every EA studio is flat out making something Star Warish.
And while the company didn’t make any mention of it at the news conference, the preview video it showed fans offered a very brief glimpse of a player wearing a PlayStation VR headset, while an X-Wing’s cockpit was shown on screen. That’s likely to stoke anticipation about a reboot of the classic 1997 title “X-Wing vs. TIE Fighter.”
EA and Lucasfilm signed a multiyear licensing deal in 2013. Due, in large part, to the strength of “Star Wars Battlefront,” EA handily beat its earnings estimate in its most recent quarter. Star Trek Bridge, the simulation of the Bridge inside of an Enterprise, a big VR commitment from EA looks like a fun game too.
MKM analyst Ian Ing claims that AMD’s recent gaming refresh was better done than Nvidia’s.
Writing in a research report, Ing said that both GPU suppliers continue to benefit from strong core gaming plus emerging applications for new GPU processing.
However, AMD’s transition to the RX series from the R9 this month is proving smoother than Nvidia’s switch to Pascal architecture from Maxwell.
Nvidia is doing well from new GPU applications such as virtual reality and autonomous driving.
He said that pricing was holding despite a steady availability of SKUs from board manufacturers. Ing wrote that he expected a steeper ramp of RX availability compared to last year’s R9 launch, as the new architecture is lower-risk, given that HBM memory was implemented last year.
Ing upped his price target on Advanced Micro Devices stock to 5 from 4, and on Nvidia stock to 52 from 43. On the stock market today, AMD stock rose 0.9 per cent to 4.51. Nvidia climbed 0.2 per cent to 46.33.
Nvidia unveiled its new GeForce GTX 1080, using the Pascal architecture, on 27 May and while Maxwell inventory was running out, Nvidia customers were experiencing Pascal shortages.
“We would grow concerned if the present availability pattern persists in the coming weeks, which would imply supply issues/shortages,” Ing said.
After sliding its slide-rules, flicking its abacus, and counting its toes, the bean counters at Gartner have decided that the smartphone business bubble has burst splattering in the face of those who depend on it.
Big G says the market will shrink from 14.4 per cent growth in 2015 to just 7 per cent in 2016 — with only 1.5 billion smartphone units being shipped globally this year. Compair this with 2010, when Gartner notes the market grew 73 per cent.
However the signs have been obvious for about a year. Mature Western markets saturated, China’s growth engine slowing as demand has topped out and other markets unable to afford the higher margin gear. The smartphone has come to the end of its ability to provide new technology too with companies only able to offer incremental upgrades. Carriers are moving away from subsidizing upgrades which means that them wasting their own profits to prop up the likes of Apple are over.
In emerging markets it says the average lifetime of premium phone is between 2.2 and 2.5 years, while basic mobiles have an average lifetime of three years and up.
Gartner sees the biggest remaining opportunity for smartphone growth in India, noting that sales of feature phones — aka dumbphones — accounted for a majority (61 per cent) of total mobile device sales last year, leaving plenty of scope for upgrades as smartphones continue to become more affordable.
It is estimating 139 million smartphones will be sold in India this year, growing 29.5 per cent year-over-year. It notes the average selling price of mobiles in the country remains below $70, and it expects smartphones priced under $120 to continue to contribute around half of overall smartphones sales there this year. Apple’s hope that it can save its flailing business numbers by selling into India show the complete lack of understanding of how that market is working. It is tending to favor small local smartphone makers like Intex.
China is going to offer Apple no help either Gartner is expecting “little growth” in the region in the next five years. IT says it is “saturated yet highly competitive” market. Smartphones represented 95 per cent of total mobile phones sales last year.
Gartner analyst Annette Zimmerman said that “non-traditional” vendors in China could do well and thinks that by 2018 at least one such phone maker will be among the top five smartphone brands in the country.
“Chinese internet companies are increasingly investing in mobile device hardware development, platforms and distribution as they aim to grow their user bases and increase user loyalty and engagement,” she said.
The Sub-Saharan African region is also couched as an attractive region for smartphone vendors, with smartphone sales only overtaking mobile phones sales there for the first time last year. Nokia brand licensee and newly formed smartphone OEM HMD will want to take note, given it has paid for the right to build feature phones (and smartphones) bearing the previously iconic Nokia brand name.
What is the point of E3? I ask not in a snarky tone, but one of genuine curiosity, tinged with concern. I’m simply not sure what exactly the show’s organizers, the ESA, think E3 is for any more. Over the years, what was once by far the largest date in the industry’s annual calendar has stuck out in various new directions as it sought to remain relevant, but it’s always ended up falling back to the path of least resistance – the familiar halls of the Los Angeles Convention Center, the habitual routine of allowing only those who can prove some industry affiliation to attend. For all that the show’s organizers regularly tout minor tweaks to the formula as earth-shattering innovation, E3 today is pretty much exactly the same beast as it was when I first attended 15 years ago – and by that point, the show’s format was already well-established.
There’s one major difference, though; E3 today is smaller. It now struggles to fill the convention center’s halls, and a while back ditched the Kentia Hall – which for years promised the discovery of unknown gems to anyone willing to sift through its morass of terrible ideas. Kentia refugees now fill gaps in the cavernous South Hall’s floor plan, elevated to sit alongside a roster of the industry’s greats that gets more meagre with each passing year. This year, attendees at E3 will find it hard not to notice a number of key absences. The loss of Konami’s once huge booth was inevitable given the company’s U-turn away from console publishing, but the decisions of EA and Activision to pull out of the show this year will be felt far more keenly.
Hence the question; what’s the point? Who, or what, is E3 actually meant to be for? It’s not for consumers, of course – they’re not allowed in, in theory, though the ESA has come up with various pointlessly convoluted ways of letting a handful of them in anyway. It’s for business, yet big players in the industry seem deeply dissatisfied with it. It’s not just EA and Activision, either; even the companies who are actually exhibiting on the show floor seem to have taken to viewing it as an addendum to the actually important part of the week, namely their live-broadcast press conferences. Once the realm only of platform holders, now every major publisher has their own – and if EA and Activision’s decision to go their own way entirely, leaving the E3 show floor, has no major negative consequences for them this year, you can be damned sure others will question the show’s cost-value next year.
The problem is that the world has changed and E3 has not. Once, it was the only truly global event on the calendar; back then, London had ECTS and Tokyo had TGS, but there was no question of them truly challenging E3′s dominance. The world was a very different place back then, though. It was a time before streaming high resolution video, a time before the Internet both made the world a much smaller place, and made the hyper-local all the more relevant. Today, E3 sits in a landscape of events most of which, bluntly, justify their existence far better than the ESA’s effort does. Huge local events in major markets around the world serve their audiences better than a remote event in LA; GamesCom in Germany and TGS in Tokyo remain the biggest of those, but there are also major events in other European, Asian and Latin American countries that balance serving the business community in their regions with putting on a huge show for local consumers.
In the United States, meanwhile, E3 finds itself assailed on two sides. The PAX events have become the region’s go-to consumer shows, and a flotilla of smaller shows cater well to specific business and social niches. GDC, meanwhile, has become the de facto place to do business and for the industry to engage in conversation and debate with itself. The margin in between those two for a “showcase show that’s not actually for consumers but sort-of lets some in and is a place for the industry to do business but also please spend a fortune on a gigantic impressive stand” is an increasingly narrow piece of ground to stand on, and E3 is quite distinctly losing its balance.
A big part of the reason for that is simply that E3 has an identity crisis. It wants to be a global show in the age of the local, in an age where “global” is accomplished by pointing a camera at a stage, not by flying people from around the world to sit in the audience. It wants to be a spectacle, and a place to do business, and ends up being dissatisfying at both; it wants to excite and intrigue consumers, but it doesn’t want to let them in. The half-measures attempted over the years to square these circles have done nothing to convince anyone that E3 knows how to stay relevant; slackening ties to allow more consumers into the show simply annoys people who are there for work, and annoys the huge audience of consumers who remain excluded. The proposed consumer showcase satellite event, too, will simply annoy companies who have to divide their attention, and annoy consumers who still feel like they’re not being let in to the “real thing”. Meanwhile the show itself feels more and more like the hole in the middle of a doughnut – all these huge conferences, showcases and events are arranged around E3′s dates, but people spend less and less time at the show proper, and with EA and Activision go two of the major reasons to do so. (It’s also hard not to note, though I can’t quantify it in figures, that more industry people each year seem to stay home and watch the conferences online rather than travelling to LA.)
The answer to E3′s problems has to be an update to its objectives; it has to be for the ESA to sit down with its membership (including those who have already effectively abandoned the show) and figure out what the point of the show is, and what it’s meant to accomplish. The E3 brand has enormous cachet and appeal among consumers; it’s hard to believe that there’s no demand for a massive showcase event at the LA Convention Center that actually threw its doors open to consumers, it’s simply a question of whether ESA members think that’s something they’d like to participate in. From a business perspective, I think they’d be mad not to; the week of E3, loaded with conferences and announcements, drives the industry’s most devoted fans wild, and getting a few hundred thousand of them to pass through a show floor on that week would be one of the most powerful drivers of early sentiment and word of mouth imaginable.
As for business; it’s not like there isn’t a tried, tested and long-standing model for combining business and consumer shows that doesn’t involve a half-baked compromise. Tons of shows around the world, in games and in other fields, open for a couple of trade days before throwing the doors open to consumers over the weekend. Other approaches may also be valid, but the point is that there’s a simple and much more satisfying answer than the daft, weak-kneed reforms the ESA has attempted (“let’s let exhibitors give show passes to a certain number of super-fan consumers” – really? Really?).
E3 week remains a big deal; E3 itself may be faltering and a bit unloved, but the week around it is pretty much the only truly global showcase the industry has created for itself. That week deserves to be served by a better core event, rather than inexorably moving towards being a ton of media events orbiting a show nobody can really be bothered with. The organizers at the ESA need to be brave, bold and aggressive with what they do with E3 in future – because just falling back on the comfortable old format is starting to show diminishing returns at an alarming rate.
Not so long ago it was impossible to check up on your ex without getting a Farmville invite, but since then it seems that gaming has moved away from Facebook and onto mobile phones. Speak to the Facebook games team though, and they’ll tell you that Facebook is a bigger part of the gaming industry than ever.
“To answer the broad question of ‘Where is Facebook Games today?’ the right answer is today we’re everywhere. When I say we’re everywhere what I mean is we work with developers on just about any system that they’re on. They’re on mobile devices, PCs, desktops, Macs, whatever it’s going to be, consoles as well,” says director of global games partnerships Leo Olebe, a gaming veteran who’s worked in marketing for BioWare, Kabam, Zynga and more.
“We have a very strong and overall healthy gaming business. There’s a lot of people that are participating in the Facebook Games ecosystem as a whole and we’re just really passionate about making sure that people have the power to share the stuff that they love.”
He points particularly to Facebook’s recent work with Riot and League Of Legends and the simple ability to log into your PlayStation 4 with Facebook and share screenshots and video directly to your Facebook news feed.
League Of Legends saw 4 million players connect their League of Legends account to their Facebook accounts, which resulted in 15 million new friend connections.
“Yes, we have a really incredible and thriving developer and publisher community that’s on Facebook, people playing all sorts of games from Candy Crush to social casino games but then also participating through the rest of the ecosystem as well,” Olebe says.
Facebook also shared some stats with GamesIndustry.biz: over 550 million people play games that are connected with Facebook every month on desktop, mobile and console and more than 30 million people have connected their Facebook account to either PSN or Xbox Live. Of course, Facebook is also the owner of virtual reality pioneers, Oculus VR.
With Facebook Games Arcade, the company is looking at finding new ways for people to discover and access games when they’re using Facebook on desktops. The company pointed out that users currently can choose from over 500 games including Clash of Kings, Family Guy: The Quest for Stuff and Angry Birds Friends to name but a few.
On the development side, it says developers earned over $2.5 billion on Facebook’s web platform in 2015 and 15 per cent of time spent on Facebook.com is gaming.
“What we’ve done is we’ve become even more sophisticated about how to really think about the 1.6 billion people that are on Facebook. What I mean by more sophisticated is we’ve developed a whole suite of products that developers can use to really understand the people who are playing their games and loving their games. Whether that’s Facebook Login and friend finding, analytics, sharing products, a lot of people use our mobile app install ads to do user acquisition, [so] we have audience network tools,” explains Olebe.
“The most sophisticated publishers and developers out there truly understand that Facebook is a global platform”
“There’s no one thing that everybody has to use but there’s a lot of different things that are valuable to different publishers and different developers in different ways so we really wanted to adapt all our platform products to be flexible as their businesses change as well.”
Calvin Grunewald, engineering manager for games at Facebook elaborates:
“One of the goals from an engineering team perspective is that we want to let game developers build, grow and monetize their apps,” he says.
“It’s a really cool time to be a developer and it’s a really cool time to be working in the platform business just because you get to facilitate social connections on all of these platforms and developers are hungry for them.”
So with Facebook playing such a large role on console, PC and mobile what preconceptions do people still have about Facebook and games that are just downright wrong?
“If anything I think it’s that people still have this idea that Facebook’s place in the global games industry and business is somehow limited to games that you play on the web,” says Olebe.
“The most sophisticated publishers and developers out there truly understand that Facebook is a global platform and assists not only with user acquisition but also heavily with sharing and engagement. We really operate everywhere that gamers are.
“There are misconceptions out there, but I think only because people have an old understanding of Facebook as social games on the web and haven’t spent as much time thinking about all the different avenues where we play.”
While some publishers establish their own eSports divisions and appoint chief competition officers, Take-Two is approaching the competitive gaming trend with a bit more caution. Speaking with GamesIndustry.biz in advance of the company’s financial earnings report today, CEO and chairman Strauss Zelnick said the field was promising, but still unproven.
“eSports we find very interesting,” Zelnick said. “It is, however, still more a promotional tool than anything else. And most people see eSports as an opportunity to increase consumer engagement in their titles, and depending on the title, to increase consumer spending within the title.”
To date, Take-Two’s biggest eSports endeavor has been an NBA 2K tournament with 92,000 teams competing for a $250,000 prize. The final 16 teams are set to compete in a single-elimination tournament this weekend, with the finals taking place during the NBA Finals next month.
“It’s just the beginning for us,” Zelnick said of the tournament. “It’s very gratifying so far, but we have yet to see it as a stand-alone profitable business. We see it more as an adjunct to consumer engagement in our titles.”
Zelnick also addressed the company’s digital revenues, which for the first time made up more than half of its revenues for the year. While the industry has shifted heavily toward digital in recent years, Zelnick doesn’t see this as some sort of tipping point or a harbinger that physical goods are in for declines from here on out.
“This year was a little different because we had a very significant portion of this year’s revenue through digital distribution,” Zelnick said. “And that’s a reflection of the power of titles like Grand Theft Auto Online as well as PC titles, 90 percent of which are digitally delivered. With frontline console releases, your numbers are more like 20 percent from digital distribution. So physical distribution remains the lion’s share of our revenue.”
While Zelnick acknowledged the growth of digital distribution is a good thing for Take-Two, he specified that it wasn’t a strategy for the company because it’s ultimately out of his hands.
“We want to be where the consumer is, and we’re not really the ones who vote,” Zelnick said.
Orcs Must Die! Studio Robot Entertainment is a rare breed nowadays – in an age where you’re either indie or AAA, the Plano, Texas-based company (one of several Texas developers that rose from the ashes of Age of Empires studio Ensemble) has managed to succeed as a mid-sized outfit. When Robot was formed in 2009, the company operated on a small scale, but things really changed when it landed a major investment from Chinese media giant Tencent in 2014. That enabled Robot to scale up and to benefit from Tencent’s knowledge at the same time.
“We made the first Orcs Must Die! as a semi-indie studio. We were about 40-45 people. We’re about twice that size now. And we were able to do Orcs Must Die! and Orcs Must Die! 2 with that. We kind of kept following the franchise and following what the fans were asking for in that game and we knew the next version was going to be bigger. We had to make a strategic decision – were we going to stay small and try to do another small version of that game or did we want to be ambitious and try to do something a little bit bigger? And that was going to necessitate a different type of arrangement for us to find financing. Because, you know, just selling a $15 or $20 game on Steam over and over is tough to support a studio to make a bigger game,” Robot CEO Patrick Hudson told GamesIndustry.biz.
“We also did some licensing deals for this game. As an online game, we didn’t necessarily have an ambition of setting up a European publishing office or an Asian publishing office. So we went to Europe and we partnered up with GameForge and licensed the rights for them to publish the game for us. And that comes with some advances and license fees, which help us make the game. We did the same thing with Tencent in China and that led to an investment. So we are in that mid-space. I think you’re right that there are fewer people in that space right now. It would probably be harder for us to stay in that space if we didn’t have really strong partnerships with folks like GameForge and Tencent.”
Investments and partnerships can clearly make a difference to any game company, but it’s also easy to mismanage a studio’s growth. Before you know it, one department doesn’t know what the other is doing, and things spiral out of control.
“It’s all in how you manage it. You’re either afraid of that growth or you embrace it, put a process and structure in place to allow for that. There’s no question we have to run our studio differently at 90 people than we did at 45. There’s more structure in place, there are more layers of leadership to help the project along. We’ve done a decent job of managing the growth… We went through the same kind of growth curve at Ensemble and we actually spent a lot of time talking about what went well, what didn’t go well, ‘What did we learn from that experience that we could have managed the growth better, how do we apply that to Robot?’ So we try to be a little bit smarter about that. Talking to other friendly studios [helps also] – ‘Hey, what did you guys do through this kind of growth? What pains did you experience? What did you learn?’ So we’ll grow as much as it takes to support Orcs Must Die! or as little to support it,” Hudson continued.
While everyone was devastated when Microsoft seemingly shut down a successful Ensemble Studios for no good reason, Hudson takes it as a learning experience.
In Ensemble’s case, Hudson discovered that scale ultimately held back some of its better talent. “Age of Empires attracted a lot of really good game talent to the studio, either people who were starting fresh in the games industry and learned how to make great games inside of Ensemble or we recruited really talented people to Dallas to work on the Empires franchise and, ultimately, Halo Wars. So we had just a tremendous amount of pent up talent in what was not a huge studio. At its peak it was 120 people. So it was very densely populated with talent. When you’re a studio that size, you have a lead structure within each department, but not everybody gets a chance to take those leadership positions and do their own games. Once Ensemble went away, you saw all these talented people go off in different places and show what they were capable of,” he remarked.
Working at Ensemble instilled a certain level of dedication to quality in all the developers who worked there too. “We held ourselves to a really high standard of making games that everyone took with them to their next places. I would say, in addition to that… all of us worked for another six years for Microsoft post-acquisition, so we got to learn the industry as both indie developers and inside a publisher. We got to learn the entire space, how the whole ecosystem is close to the publishing side. So that was a very valuable experience that maybe a lot of other devs don’t get,” Hudson said.
There’s no animosity or regret about Ensemble either, as far as Hudson is concerned: “Six years is a long time to be with a company post-acquisition. It was actually, for the most part, six good years. Microsoft treated us well. I think we worked well with the people we worked with at Microsoft. You do see some [studios] that get acquired and they’re gone within a year or two. We didn’t have that experience. I kind of view six years as a nice success.”
Perhaps the greatest lesson that Hudson and Robot have learned, even before the rise of Kickstarter and Steam Early Access, is that listening and responding to a vibrant community is critical. Discoverability has become a nuisance to deal with, and you need the fans behind you in order to succeed. If you have expectations that a platform holder will feature you, your marketing strategy needs an overhaul.
“As some of those previous PC developers that came into mobile are now migrating back to PC, discoverability on PC has become not quite as bad as mobile, but it’s not easy. There’s a lot of content on Steam now. There’s no easy space. Games is more competitive and a harder business than it’s probably ever been. There’s just a lot of great developers out there making a lot of great content and there’s just no barriers to putting your content out there to players, and players move quickly from game to game. They’re going to seek the best content,” Hudson noted.
He continued, “When I talk to the Valve or Apple or Google folks, they know the problem. They see it. But it’s an almost impossible problem to solve… Everyone wants to be featured, right? It’s funny, when you talk to a new mobile developer and be like, ‘Hey, we’re gonna make this great game. We’re gonna be featured.’ Probably not. You’re probably not going to be featured. Unless you’re doing something really cool and innovative and very different that really shows off the platform.
“They all have different programs to try and help you get noticed but you can’t make that the core of your strategy. It’s really up to you to make a great game. If you don’t have a marketing budget to cultivate a community, start with a small community, really cultivate it and listen to them and speak to them and let them organically grow. It’s not the platform holder’s job to make it successful.”
Beyond building a robust community, selecting the right business model for your game is crucial. While free-to-play is almost the default option in today’s market, Hudson said that premium games are coming back too.
“We really do think of it as a case-by-case. There are interesting trends in the market where you’re seeing paid games come back in certain areas – even in China where we’re seeing an uptick in paid games, customers in China buying paid games. [That's] never happened before. So it’s really going to depend on the game, the needs of the game,” he commented.
For Orcs Must Die! Unchained, which just entered an open beta about a month ago, free-to-play just made sense for Robot, as it’s a big multiplayer MOBA-style tower defense game; Robot wants as many people online for matchmaking as possible. Hudson and Robot have tried free-to-play before with Hero Academy in 2012, but he fully admitted, “We made a ton of mistakes, we didn’t really know what we were doing. It was a very successful game critically. It probably should’ve been a little more successful for us commercially, but we learned those lessons and hopefully we’re applying some of those.
“[Unchained] will be our first big free-to-play PC title. And we get a lot out of our partners too. GameForge has been operating free-to-play titles forever. Tencent has been operating free-to-play titles forever and we really lean on their expertise and we ask them to be involved with us as we design the game. The nice thing about both of those partners is… monetization follows. They start with making a great game, get the players around, keep the players around, [and then] hopefully they’ll pay you down the road. But don’t solve for money up front. So we’ll see. This will be our first foray into it. We’ll make a few more mistakes I’m sure but hopefully we learn quickly.”
Right now Robot remains 100 percent committed to Orcs Must Die! and the studio is bringing the game to PS4 later this year, but that doesn’t mean it expects to be pigeonholed with that one franchise. Hudson said that Robot continues to brainstorm new IP ideas, but nothing has made it too far along in development to warrant a release. “We’ll definitely do a new IP again. We started a couple of prototypes in the past few years that haven’t panned out. It happens all the time, right?” he said, adding that the company also remains interested in mobile but is “very cautious.”
“I think what’s interesting about mobile over the last couple of years is how non-dynamic the market is as far as the top games. The games that have lived in the top charts have been there now for 2 or 3 years. They get there and they stay there and they’re really good at staying there and it’s hard to break in and become the new thing. There are some good case studies for that. Certainly not nearly as many as there are on PC,” he said.
Hudson on VR
Likewise, virtual reality, although enticing, is just too risky for a studio like Robot, Hudson noted.
“It comes back to a company our size and where we sit. For us to overinvest in a market where it’s hard to know what the growth curve is going to be would be pretty risky at our size. We can’t afford to be wrong on something this new and this different… We love the options it provides for new and compelling experiences in games. We’ve brainstormed plenty of ideas for Orcs Must Die! in VR and we’ve got some pretty good ones, but it’ll be a while before we seriously invest in it,” he said.
Hudson joked that Robot is “living vicariously” though a couple of ex-Ensemble studios in Dallas that are working on VR now.
A conservative and cautious approach is probably one of the reasons Robot has managed to survive in an increasingly challenging environment. Even for eSports – an area of the industry that Orcs Must Die! clearly could excel in – Hudson isn’t jumping in headfirst.
That being said, Hudson is definitely optimistic about eSports as a sector. “I think it’s going to become an increasingly large aspect of the industry. And there will be the games that work and the games that don’t work for it. There will be a lot of companies chasing it and probably crash on the rocks trying to get there, but it’s going to continue to grow. I think you’ll see it across platforms too. I think you’ll continue to see eSports be popular in mobile. It’ll continue to grow there. You think of it as a PC thing now but it’s not. I think it’s going to encompass all aspects of games,” he said.
EA is telling the world that it wants into the third-person action market with an open world game, but it does not appear to be happening any time soon.
EA Studios VP Patrick Söderlund told us in 2015 that EA wanted to expand its portfolio into gigantic action games like Assassin’s Creed or Batman or GTA and CFO Blake Jorgensen said something similar.
“We feel like there’s a huge opportunity for us to continue to invest in new areas of the business like the action genre where we haven’t competed historically. There’s a very ripe opportunity for us to invest in and we’ve been able to bring great talent in to build out that part of the business.”
But according to Game Radar it is not going to happen any time soon. Blake is quoted as saying that the outfit was building an action genre product that’s probably will appear in three or four years.
We can expect something new from EA next year which has not been announced, Blake said. But this will not be anything like the big games which have captured popular attention.
Steam saved PC gaming. As retailers aggressively reduced the shelf space afforded to PC titles – blaming piracy, but equally motivated, no doubt, by the proliferation of MMO and other online titles which had little or no resale value – Valve took matters into its own hands and delivered on the long-empty promises of digital distribution. It was a bumpy ride at first, but the service Valve created ushered in a new and exciting era for games on the PC. Freed from the shackles of traditional publishing and retail, it’s become a thriving platform that teems with creativity and experimentation. Steam still isn’t all things to all people, but it saved PC gaming.
Sometimes, though, you look at Steam and wonder if PC gaming was worth saving. All too often, browsing through Steam to look for interesting things to try out leaves you feeling not so much that you want to close the application in disgust, but that you’d like to set the whole damned thing on fire. The reason isn’t usability, or bugginess, or anything like that – Steam has its issues, but by and large it’s a solid piece of technology – but rather the “community” that Valve has allowed to thrive on its platform. On a platform that aims to expose and promote great games from newcomers and relatively unknown indies, community feedback, reviews and recommendations are vital components, but a legacy of poor and deeply misguided decision making from Valve has meant that engaging with those aspects of Steam can all too often feel like swimming through hot sewerage.
The problem is this; Steam is almost entirely unmoderated, and Valve makes pretty much zero effort to reign in any behaviour on its platform that isn’t outright illegal. As a consequence, it’s open season for the worst behaviours and tactics of the Internet’s reactionary malcontents – the weapon of choice being brigading, whereby huge numbers of users from one of the Internet’s cesspits are sent to downvote, post terrible reviews or simply fill content pages with bile. Targets are chosen for daring to include content that doesn’t please the reactionary hordes, or for being made by a developer who once said a vaguely liberal thing on Twitter, or – of course – for being made by a woman, or for whatever other thing simply doesn’t please the trolls on any given day. The reviews on almost any game on Steam will often contain some pretty choice language and viewpoints, but hitting upon a game that’s been targeted for brigading is like running headlong into a wall of pure, frothing hatred.
Of course, Steam’s not the worst of it in most regards; the places that spawn these brigades in the first place, places like Reddit and 4chan, are far, far worse, and concoct many other malicious ways to hurt and harass their targets. That Steam permits this behaviour on an ongoing basis is, however, a huge problem – not least because Steam is a commercial platform, and provides harassers and trolls with an opportunity to directly damage the income of the developers they target.
It’s not that Valve doesn’t care about the quality of its platform. Just this week, it implemented a new feature allowing customers to see scores from recent reviews, rather than overall scores, so you can get a sense of how a game has changed since its original launch. It’s a good, pretty well considered feature. Yet its arrival really just highlights how little Valve seems to care that its storefront is being used as a tool by harassers, and filled up on a regular basis with vicious, abusive reviews and comments that no customer wants to be confronted with when browsing. Sure, traditional retail may have been hanging PC gaming out to dry all those years ago, but at least I’m reasonably sure that most traditional retail stores would have kicked out anyone who ran into their store and started screaming obscenities in the face of the first girl they saw.
“traditional retail may have been hanging PC gaming out to dry all those years ago, but at least I’m reasonably sure that most traditional retail stores would have kicked out anyone who ran into their store and started screaming obscenities in the face of the first girl they saw”
And look – I get that community moderation is hard. It’s really hard. Much harder than throwing in a quick algorithm to compute review scores from recent reviews only, which is why that got tackled first; but harassment and brigading isn’t a new problem on Steam, or on the Internet in general, and there are only so many times that you can claim to simply be picking low-hanging fruit before someone points out that you haven’t even brought a ladder to the orchard. You’re not even trying. You don’t even want to try. I stated earlier on that Steam ended up this way because of bad decision making down the years, and this is what I meant; there has never been a sense that Valve wants to tackle this problem. Rather, they’ve given the impression that they hope they can fix it with some clever engineering tweak, some genius little bit of code that’ll somehow balance the need for community feedback to expose good games against the need to stop harassers and trolls from treating the platform as a 24 hour public toilet.
That’s not how community moderation works. It’s a fundamental, obtuse misunderstanding of how any sort of system designed to manage, build and support a community works – from statecraft right on down to housemate meetings to discuss unwashed dishes. You need people; you need actual people doing actual moderation jobs, granted the training and the authority to step in and put the community back on the rails when it falls off. It’s hard, and it’s actually pretty expensive, and it takes a lot of care and attention – but it’s not impossible. Look at the progress Riot Games has made in turning around the community of League of Legends, which was formerly one of the most grossly toxic communities in gaming. It’s still by no means perfect, but Riot has shown that it cares, and that it’s willing to fight to improve things, and LoL is by far a better, more welcoming and more fun game for it. Some of that was achieved with tweaks to systems and protocols; but in the end, it takes a real, breathing, thinking human to counteract attempts by other humans to be unpleasant to one another, because if there’s one thing our species has demonstrated extraordinary affinity for over the centuries, it’s finding creative ways to skirt around rules in pursuit of being unpleasant to other people.
Riot’s done a good job of this because, I believe, Riot genuinely believes that it’s the right thing to do. Therein lies the rub; I don’t think Valve cares. It should care. It has a damn-near monopoly on PC game distribution through its storefront, and that gives it responsibilities – if it doesn’t like or want those responsibilities, that’s sad in and of itself, but I’m sure a quick dip in the swimming pools they’re filling with money from Steam might take the edge off the pain. It should also care, though, because there’s a hard limit on how much a business can grow if it permits abusive behaviour towards whole classes of customers or clients. Anyone making a game that tackles a tough subject, or aims at a non-traditional audience, or who is themselves a member of a minority group; well, they’d probably love to be on Steam, but they’re thinking twice about whether it’s a good move. That’s not conjecture – it’s something I hear almost every week from developers in that position, developers whose starry-eyed view of Steam from only a few years ago has been replaced with absolute trepidation or even outright rejection of the idea of exposing themselves to the storefront’s warped excuse for a “community”.
Today, that might just mean Steam is losing out on a few bucks here and there from creators and customers who have had enough of the toxic environment it permits; but markets diversify as they grow. Steam took over when retailers failed to serve customers with an appetite for PC games. What, then, will happen to Steam if new waves of customers – younger and more diverse – find that games and creators they like are treated abysmally by the service? Valve shouldn’t need a commercial incentive to fix this problem; they should fix it because it’s the right thing to do, because tacitly enabling and permitting abuse is really little better than engaging in harassment yourself. If that’s not enough, though, there absolutely is a commercial incentive too; Steam may be dominant, but it’s not the only option for either consumers or creators. There are far more sales to be lost from permitting abuse than from telling harassers they’re no longer welcome. Valve should give the latter a try.
The U.S. International Trade Commission has launched an investigation into seven smartphone makers on charges of patent infringement, which could lead to a ban on the sale of certain phones imported and sold by these vendors in the country.
The commission said it is looking into devices from a group of mainly Asian companies, including Lenovo and its Motorola subsidiary, Samsung Electronics, ZTE, Sony, LG Electronics, HTC and BlackBerry.
The complaint was filed against these companies by Creative Technology of Singapore and its U.S. subsidiary Creative Labs of Milpitas, California, on March 24.
Known for its Sound Blaster sound cards for PC audio, Creative has charged these companies with infringing U.S. Patent No. 6,928,433 entitled “Automatic Hierarchical Categorization of Music by Metadata,” which claims various methods for accessing different types of data, such as music or video files, on a portable media player.
Apple is said to be one of the licensees of the patent, and in 2006, Apple paid Creative $100 million for a nonexclusive license, according to Creative’s complaint. Creative had earlier that year asked the ITC to block the sale of Apple’s iPod devices for allegedly infringing the same patent.
Among the alleged infringing products named in the complaint are Samsung’s Galaxy S6 smartphone and other Samsung phones containing either the Google Play Music app (version 5.9.l854R.l904527), or the Samsung Music app (version 6.0.1508051449), which were installed on the phones prior to import.
The products at issue in the investigation are smartphones, “with the capability of playing stored media files selected by a user from a hierarchical display,” the ITC said in a statement Thursday.
If it finds infringement after investigation, the ITC can place a ban on the sale of products by these vendors, under a limited exclusion order requested by the complainant. The ITC cautioned that the launch of an investigation did not imply a decision on the merits of the case. It will set a target date for completion of the investigation within 45 days of its institution.