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Games should sell more - Cohen

Wed 27 Jan 2010 4:32pm GMT / 11:32am EST / 8:32am PST
Publishing

Jerry Bruckheimer Games exec says industry should "think bigger"

Videogames should be selling more units, according to Jay Cohen, president of development for Jerry Bruckheimer Games - a company which he describes as a "game incubation studio."

Speaking in his keynote during the Game Business Law summit at Southern Methodist University, he expressed his belief that the industry needs to "think bigger" in terms of who it is appealing to, and not simply spend large amounts of money communicating to the same core audience.

"I wanted to address the new dynamics we were seeing in the business," he told the audience, made up mostly of attorneys and game executives, pondering the question: "How do we sell and reach more of an audience with our product?"

For him, the success that games are currently seeing on average doesn't fall in line with the increasing hardware installed base, an issue which he feels Jerry Bruckheimer Games is well positioned to address.

"Thirty, forty, fifty million per platform - but we were slapping ourselves on the back for selling one or two million copies of a game!" he exclaimed, referring to his time spent as a publishing executive at Ubisoft as the company grew revenues from $1 million to $1 billion in 13 years.

"The installed base of consoles is going at a healthy pace," he added, "Yet the sales of packaged goods hasn't kept up" - although he does believe that hardware has won over the mainstream.

"Installed bases are going up and up and up," he said, referring to six million units of hardware sold over a four week period in December, while software sales declined year-on-year. "It doesn't make sense when you say it. What are they using the hardware for if they’re not buying software?

"Are we not serving our audiences as well as they can be?" he added.

Cohen went on to describe the industry as having painted itself into a corner, where the core audience is so highly engaged that their feedback to publishers and developers is additive, creating a feedback loop that is mutually satisfactory, but ultimately doesn't add to game sales.

"We just kind of assume that everyone will become a hardcore gamer," he said, adding, "I think we're spending a lot of money on the same guys" - too much, in fact, and money which could be better spent on other, less core gamers that also own hardware."

"We've got the world captivated by what we do," he said. "Sometimes markets are down. When you're down, suck it up. Yes, we're down on the publishing side. But reinvent - we've got to be thinking bigger."

9 Comments

Robert Watson Senior Game Designer, Jagex Games Studio

4 13 3.3




Edited 1 times. Last edit by Robert Watson on 27th January 2010 6:22pm

Posted:4 years ago

#1

Tommy Thompson Studying Artificial Intelligence (PhD), University of Strathclyde

110 0 0.0
I'm sorry but these comments sound very ill-informed and naiive. Which is quite staggering given Mr Cohen's experience at Ubisoft prior to working for Jerry Bruckheimer. The idea that a big title on any platform can sell anywhere near a sizeable fraction of the total hardware units sold (nowadays) is mad. I assume these comments were ideal for the presentation's audience, but I doubt anyone else should take it seriously.

Simply put: gamers tastes differ. You cannot make a huge AAA title along the lines of Uncharted, Modern Warfare, Halo, God of War etc. and expect it to satisfy every demographic. Even more ironic is reference to his previous experience at Ubisoft, a company which in my opinion has made great progress in diversifying their product range for niche audiences and innovating concepts to bring in new players. Of course these business decisions carry great risk and can in turn effect a developers profits. So most companies are playing things cautiously.

Statistically, "less core gamers" (i.e. Wii/DS gamers) do not have as high a console attach rate as other gamers. Ultimately it appears that sales trends on the Wii are driven by gimmickry and smart advertising (Just Dance is still no. 1 right?). If anything I would agree that money should be invested to improve the general quality of wii products. This in-turn may spur further sales by the consumer, but I doubt it.

But hey, perhaps Mr Bruckheimer's games company can prove us all wrong. ;-)

Edited 1 times. Last edit by Tommy Thompson on 27th January 2010 6:29pm

Posted:4 years ago

#2

Sebastian Cardoso Project Manager, Crytek

15 0 0.0




How about giving that approach a shot and not doing what Activision did with Modern Warfare 2, raising the prices even more because they knew they had a great seller in their hands? How much of a dent would that put on piracy, don't you think?

Posted:4 years ago

#3

Wolfgang Siebert Project Manager, Bigpoint

8 0 0.0
As so often, I think the truth is somewhere hidden in the grey area between Robert's, Tommy's and Mr Cohen's positions.

Considering that Bruckheimer's is coming from film, they may compare "DVDs sold per DVD player" to "games sold per console" and end up with a signifikant mismatch, which they adressed in this keynote. Is the ratio mismatched? Hell Yeah! I personally own around a 100 DVDs and about 10-15 X360 games, so yes, even in my home the ratio is tilted. But why?

Beacuse out of those 100 DVDs I get about 200-400 hours of entertainment and out of those 10-15 games I get something like 200-500 hours of entertainment... I just spend more time with a single game than I spend with a single movie.



On the other side, making games "better quality" might sound great too, and I am all for that! However "better quality" means "more man-power" or "more time" which both come out as "more costs". Honestly, in my position, I have been trying to get that into the heads of publishers for a while, but a lot of times the economic constraints we are working in are just don't allow for stuff like that, even if the publisher "wants more" they usually can't "give more". It's called risk management, I think. ;o)

So what's to do? Well for one, I think we need to mature a bit more, just as we have been doing. Comparing games to the movies, I would say we are currently in a similar transitional phase as movies have been in the 40s and 50s of last century. That means with the market segregating furher, we as developers find ourselves specilizing more and more and with that comes a much stronger streamlining of production.

In the 40s, movie companies stoped expanding on technology and focused on content. We can see similar trends in games at the moment, but we're not quiet there yet. We find more and more research being done in the field of games, which will result in similar "standards" as the "3 act structure" of Fields. We see production being split up between specialized companies, similar to "the Hollywood model" we know from movies these days (for better or worse). We find a considerable consolidation in technology, which I think will have to boil down even further. All this making games maybe more formalized, but giving the whole production a framework to fill and work in. This will ultimately lower costs, while increasing appeal. Which may make these ideas of lower prices at higher quality possible... may.

Yes, there will be negative sides to that, no doubt, and don't think this is my vision of a utopian perfect world, but I think it's what's going to happen. ;o)

However in all this contemplation we must not forget the most fundamental thing: Games are an active form of entertainment. I need to do control stuff. I need to learn controls, strategies etc. I need to make decisions... But many people prefer to spend their time for entertainment "on the couch" with passiv stuff, like watching a movie or reading a book. There will be NO WAY to activate these people make them change their preference of passing time. It's like trying to make a vegetarian like meat.

What I'd more interested in is how many copies of a board game get sold... after all, you can't beat their install base - everyone has a table!

Posted:4 years ago

#4

Sergey Galyonkin Marketing Director, EMEA, Nival Network

24 0 0.0
We have good example of price lowering at iPhone actually.

Average American iPhone user spends $80 on applications (<a href=http://www.tuaw.com/2009/09/08/survey-average-iphone-user-has-spent-80-on-apps/>source</a>).

Аverage American console owner buys 6 games (<a href=http://www.gamasutra.com/php-bin/news_index.php?story=23308>source</a>). And this is more like $200.

So while games prices are high, you cannot be sure that you could make more profit selling more cheaper games.

What industry actually lacks is price diversity.

Kudos to Valve for exploring how prices actually affect sales and profit. In console industry which is still brick-and-mortar Steam-like experiments ($2 for game for 2 days) are much harder to do.

Posted:4 years ago

#5

John Bye Senior Game Designer, Future Games of London

480 451 0.9
Sergey, that's a bit of an apples and oranges comparison. Also, as far as I can see the numbers are based on the number of games divided by the number of hardware units sold, over the lifetime of the platform to date, rather than per customer per year from purchase, which is a bit misleading as early adopters obviously have a lot more games than people who have only recently bought the hardware simply because they've had longer to build up their library. It also doesn't take into account people who have multiple consoles and buy games for all of them.

Also, the difference in price between iPhone and console games is often an order of magnitude or more. I don't think anybody here is suggesting selling Xbox 360 and PS3 games for a couple of pounds / dollars each like a lot of iPhone games (except maybe for smaller scale PSN/XBLA titles), but I certainly suspect there's a happy medium where the lower return per unit would be more than balanced out by higher sales, especially as we move more towards digital distribution and the manufacturing and distribution cost per unit drops towards zero.

Posted:4 years ago

#6

Sergey Galyonkin Marketing Director, EMEA, Nival Network

24 0 0.0
John, I totally agree with you. I've mentioned iPhone because we don't have any better information on how would users behave if prices would be significantly lower. You only have so much free time in your life, so if ALL games are cheap, it might just mean that gamers would just spend 10 dollars per month on their games instead of 30 or 40.

What I'm talking about is that while total price lowering wouldn't make sense in a long run, some kind of more broad price diversity would certainly help. These days you see new console games for 60 euros and platinum for 30. If something is launching at 50 or 40 you suspect is B-grade.

What I'd like to see is new games at various price levels, just like you said about LBP and Mirror's Edge. And that's why I love Steam and digital distribution - it allows you to test different pricing models much faster.

I'm working with retailers and I do understand, that they like high margin products and suspect any cheap games to be low quality and just shelf-stocker, not a money-bringer. If games is platinum release and it proved itself, it's a different deal of course.

But I've also worked with retail on PC accessories and there you have huge diversity in pricing. And you never hear: "This mouse is too cheap, so it will never sell". :)

Posted:4 years ago

#7
I dunno, I'm kinda with Bruckheimer and the lads - what the guy says makes sense if you consider the breadth of titles available on our hardware. For all the waffle from the publishers about social this, casual that and online the other, we're an still an industry knocking out $40 million dollar games about killing people and that's a niche market in the real world even if it's the biggest market in console gaming. Nintendo is the only publisher with the sheer balls to create a whole new gaming space - almost everyone else is stuck in small beer short-termism, paying lip-service to innovation. Activision is a great success though it represent the apex of the old conservative, creatively static publisher model that EA developed and everybody else tried to imitate. Where Acti really could take over is if they start putting huge Nintendo-like money - not just *some* money a la EA - into alternative projects that attract non-gamers, stuff we've never seen or attempted before. Heavy Rain, for all it's slaggings as an interactive story, represents something close to that - gamers will hate it, it may fail but it'll go out fighting on the street, unlike the rest of us 'hardcore' types who prefer a quiet night in by the fire button, old before our time.

We should be an industry that leads from its creative centre instead of constantly following the old money trail of what worked before - it only ever leads backwards or at best 'round in a circle. Yes it can generate lots money - for publishers mostly - but it chokes our potential new market off and is slowly killing our future. That future *is* bright but only if it's not the past. Yet many publisher & dev types go white in the face if you mention the priority or even parity of creativity in what we do. Their mentality is exactly why the industry is suffering so much when it should be taking off.

Hardware is just that - hardware, it'll run anything we tell it to. We need to offer new software experiences, not just new games. If we all continue to stick with our current view, Bruckheimer or his type really will clean our clocks - these guys only deal in mass volume and are clever enough to think the unthinkable to get there. Like Nintendo, Bruckheimer also understands the power of a supreme act of will, unlike our poor publishers and devs who are just too caught up in the here-and-now business side of what we do to see the horizons before us. Jerry and his lot can afford a LOT of drugs - they know the economic power of dreams, have Vision to go and Distant Horizons up the ya-ya.

Spliff anyone?

Posted:4 years ago

#8

Jim Webb Executive Editor/Community Director, E-mpire Ltd. Co.

2,270 2,439 1.1
Statistically, "less core gamers" (i.e. Wii/DS gamers) do not have as high a console attach rate as other gamers.
Tommy, according to NPD and other tracking firms, the attach ratio for Wii is right in line with X360 and PS3.

The DS, as with all portables, is always lower than consoles but is much, much higher than the PSP.

Wii and DS have received bad raps from shoddy journalism that failed to do their homework but if you check the data, you'll surprise yourself.

Posted:4 years ago

#9

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