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Retail

Core games remain "best investment" for publishers

Tue 23 Nov 2010 2:06pm GMT / 9:06am EST / 6:06am PST
Retail

Survey recognises growth in online gaming but not at expense of AAA market; Move/Kinect not attracting new consumers

A new survey by Cowan & Company has concluded that software for the core videogames market is still the best investment for a traditional publishing company, despite the rise of online social gaming and multi-use devices.

Less than five per cent of 2301 respondents said that they had bought fewer console games as a result of increased time playing online, social or free-to-play titles, and games on hardware such as the iPad.

And although demand for motion controllers Move and Kinect is high amongst owners of the PlayStation 3 and Xbox 360, the results indicate that demand from non-owners of the home consoles appears "tepid."

More favourable for non-owners would be a price cut to current hardware, found the survey, with respondents willing to pay around $30 less than current US prices of Xbox 360 and PS3.

"We believe that the hardware manufacturers have left unit sales on the table by not reducing price points from $199 to $179 and $299 to $249 for the applicable consoles, and that doing so would have driven a more significant boost to hardware sales than the release (for Microsoft and Sony) of new motion-sensing peripherals.

"We view continued stubbornly high hardware price points as one of the key factors dragging down software sales," said the report.

Other conclusions from the report were that 76 per cent of online console gamers had bought some form of downloadable content in the past year, with 46 per cent spending over $20.

"The results of our Fall 2010 Videogame Survey do not change our view that high-quality games for the core gamer remain the best investment for videogame publishers despite changes to the structure of the videogame industry," concluded the report.

14 Comments

Jack Loftus
Contributing Editor

95 0 0.0
...and a game like Black Ops will be the "Game of the Year" again.

Is this industry truly incapable of change?

Posted:3 years ago

#1

Soeren Lund
Producer

42 1 0.0
Until publishers shrink their publishing, marketing and distribution overheads so they can start making money on more diverse titles with lower unit sales, then yes.

Posted:3 years ago

#2

Eduard Pandele
Senior Game Designer

6 0 0.0
What's wrong in wanting to get more of the same ? The vast majority of gamers love sequels and familiar experiences; honestly, I'd be perfectly happy with a new Yakuza or The Witcher or Uncharted or Resident Evil every six months, giving me more of the same awesome gameplay experience with new stories and settings.
That's not to say I don't enjoy new experiences (Cut The Rope, Trainyard).

Posted:3 years ago

#3

Chris Thomas
Sales Manager

5 0 0.0
I'd love more information on the respondents. Age, gender etc. Were these mostly core gamers they sampled? With as high a stat as 76% buying console DLC it sounds like it skews in that direction.

Posted:3 years ago

#4

Jeff Lindsey
Senior Producer

9 3 0.3
Am I missing something, or is "the number of console gamers who have bought less titles because of other channels" pretty irrelevant, given the fact that those channels are rapidly becoming more and more attractive to people who can make good and appealing games, which definitely includes console publishers (/dodges the thrown tomato).

They have a larger install base, faster adoption rates, and the titles are lower risk, lower barrier of entry, and faster and easier to create because they generally have lower consumer expectations of "production value", i.e. high-fidelity graphics, complex physics, AI and such. These may start to rise, but I honestly don't think it will ever come within spitting distance of an average console title's effort.

Does anyone expect publishers to read this report and say "hey look, 2186 people said they don't buy those games, let's shift more of our budgets back to AAA"? And what is their definition of a "traditional publisher" anyways? Most of the big publishers are already heading into these channels, and with hard ROI numbers, are in a better position to judge where to spend their time and money.

Edited 1 times. Last edit by Jeff Lindsey on 23rd November 2010 3:26pm

Posted:3 years ago

#5

Ross Colgan
Experienced Artist

13 0 0.0
"The results of our Fall 2010 Videogame Survey do not change our view that high-quality games for the core gamer remain the best investment for videogame publishers despite changes to the structure of the videogame industry," concluded the report.

Can I just point out the problem I have with this line here. If a researcher still has a 'view' or 'belief' after undertaking thorough research, then that's not very convincing language to give me confidence that the research was particularly an honest or thorough, and wasn't looking to reach a pre-arranged conclusion.

Much in the same way our government would, for example, order a review on drugs policy and then simply conclude that they were right all along despite blatant evidence to the contrary.

You either know or you don't, and you'll either tell us straight or you won't.

Posted:3 years ago

#6

Terence Gage
Freelance writer

1,288 120 0.1
"We view continued stubbornly high hardware price points as one of the key factors dragging down software sales,"

Although I think a moderate price cut would do wonders for both Sony and MS's hardware sales, I'm not convinced it would have a particularly large impact on general software sales -- I think it would still be the same few games selling mammoth amounts, and most of the others slipping off the chart very quickly and receiving discounts from the retailers.

"And although demand for motion controllers Move and Kinect is high amongst owners of the PlayStation 3 and Xbox 360, the results indicate that demand from non-owners of the home consoles appears "tepid." "

I'm not surprised really; I've not actually seen nearly as much Kinect presence as I'd expected, and I think MS will have to try a bit harder to break the perception that the 360 is a console for men or boys who like shooting games. Move is a little different, as that doesn't seem to have been marketed at anyone really except current PS3 owners anyway, although I agree that it's unlikely to draw anyone into buying the console if they weren't already interested.

I guess we'll have to wait and see how both hardware performs in the run-up to Christmas (and what their software support is like in the coming months), but I don't think Move or Kinect are very likely to steal away the Wii's audience in the long term.

Posted:3 years ago

#7

John Kauderer
Associate Creative Director

32 5 0.2
On one hand it's nice to be reminded that you can still make money on a AAA title, but the article seems to assume that your AAA will be successful. Because of the massive overhead of development and marketing the AAA needs to hit and often times for whatever reason gamers just aren't interested. Take a look at Enslaved for example, the game got good reviews, seemed to have been heavily marketed, yet early sales were low. It seems unlikely that Enslaved will pull a profit.

@Soeren Lund: I think you just described Atlus' business plan

Posted:3 years ago

#8

Terence Gage
Freelance writer

1,288 120 0.1
@ John - "Take a look at Enslaved for example, the game got good reviews, seemed to have been heavily marketed, yet early sales were low. It seems unlikely that Enslaved will pull a profit."

In recent Namco Bandai financials, they revealed Enslaved had sold 800,000 copies, which were below expectations of a million. I would be interested to see what threshold they would be looking at to break into profit, as I want Ninja Theory to be successful. Enslaved was a top game in many regards, but I felt a few aspects kept it back from greatness.

Posted:3 years ago

#9
Hmm this report seems a bit wierd on a few levels:

"Less than five per cent ... bought fewer console games as a result of increased time playing online, social or free-to-play titles "

This bit doesn't add up. Certainly their playing time on console must have been down (I know mine was...), if not their purchases dropping off. In time, one leads to the other anyway. Which gets at the most bizarre bit of this - the underlying message: "Rest easy all - what's worked before will work in the future".

Is there anyone left in the industry that still believes that?

Posted:3 years ago

#10

Sam Cobley
Director

7 0 0.0
I think you misunderstood Barry. It is saying that less than 5% of people played social/online games for a sufficient period (hours) to infringe on their console playing time. Therefore they still spent as much on new console games.

Posted:3 years ago

#11
@Sam: You're right, so I did, as I often do :P My random reply still makes sense though I think - it seems the poll is all about past trends, yet is predicting the future. If they are saying these console gamers don't really play those "other" games at all then I get the analysis. But if they do at all, it makes no sense. I guess I'm really suspicious of the message though - if publishers still think that the rump of gamers who are still refusing to play games on iphone, smartphone, Facebook, HTML, flash, PC, Online etc. are the gamers we need to be chasing in 2,3,4 years time, then I fear for their shareholders.

Posted:3 years ago

#12

Bonnie Patterson
Freelance Narrative Designer

159 431 2.7
@Jack Loftus: COD Black Ops is not just a big name, however. Though I haven't played it all the way through yet, the single player storyline is intriguing and well presented, the level designs are intuitive without being optionless in play, the graphics are nice and the gameplay smooth. The multiplayer options add a greater challenge than can be presented by AI and include some nice social features, like the ability to add played games to your player card.

It has content, and that's what I look for in games nowadays - something that engages my imagination and provokes me to speculate on what lies ahead in the story, not just twitch my finger at the right moment.

Posted:3 years ago

#13

Greg Wilcox
Creator, Destroy All Fanboys!

2,174 1,123 0.5
The problem is when good "core" games that don't fit the blockbuster descriptions above fail to sell because they get overlooked by either the gaming press or gamers that solely rely on the gaming press to "guide" them in making decisions that should make on their own.

You'll always see that one guy in a game shop hovering around a particular game (now marked down to a budget price) that never got reviewed or may have gotten a 7 (aggregated, argh) from a bunch of dopes who didn't "get" what the developer intended and instead shot the game down for not being "innovative" when it was actually a ton of fun. this guy usually plunks down that twenty plus tax, takes the game home and twenty minutes into it, he's calling or texting friends and babbling as if he's been hit in the head by a 2 X 4 made out of heroin-laced Peeps.

Of course, three to four months (or more) after the launch when the game is considered "dead" isn't the best for that studio that had to shut down because their game got savaged, but hey - a sale is a sale to some folks...

Posted:3 years ago

#14

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