American McGee on the "unsustainable" console model
Spicy Horse co-founder claims earning out on console is like "digging out from under an avalanche"
American McGee believes that the free-to-play business model offers developers an escape route from the the crushing pressure of turning a profit on console games.
In an interview with Game Informer, McGee describes the market conditions that prompted him to re-focus his Shanghai-based studio Spicy Horse on free-to-play and mobile games.
"Earning out on a console title is like digging out from under an avalanche," he says. "If you don't get out from under the advances within a very short period of time it's all over.
"Free-to-play offers an opportunity to release something into the wild and improve it continually until it returns a profit. Making good on the opportunity is in no way guaranteed, but the option is there."
According to McGee, Spicy Horse is already generating more profit from its free-to-play games - BigHead Bash and Crazy Fairies - than it did from its last console release, Alice: Madness Returns, and he expects that gap to widen in the future.
His perspective is influenced by Spicy Horse's Shanghai location: many of the people who work at the studio are local Chinese, and their entire gaming culture is built on free-to-play titles.
"Though the console market extracted two decades of profit and mind-share from Western developers and consumers, it was unsustainable from inception. Looked at from the perspective of external markets where consoles aren't the foundation of the gaming ecosystem, the idea of physical media (discs) and fixed location gaming (consoles) now seems anachronistic.
"But it's worth examining where the money flowed in a market where consoles dominated and how they helped consolidate power among a handful of publishers. The transition we're now seeing is a revolution of the model that will lead to greater freedom for future publishers, developers and consumers."
Nice addition to the debate.
One problem with the current gen consoles are that they are seven year old technology and an even older business model. Basically they are history. In technology, marketing and business models terms we now live in a completely different age.
Now we have Facebook, app stores, microtransactions and free games, for starters.
Also it has been a pretty rubbish console generation. The cost of development and market entry rose to ridiculous levels. So just about all that was sustainable was blockbuster sequels. This took innovation and creativity out of the market. And drove away customers, diminishing the user base.
Posted:10 months ago