Digital distribution has taken longer to catch on than most would have predicted when the current generation of consoles launched. While the infastructure has been in place a while, retail sales have only been impacted minimally by download sales, and, unexpectedly, it's been the iPhone which has really demonstrated how it can be done.
Except there are gaming companies that invested in digital ahead of the crowd, and at the forefront of those was Telltale Games. Founded in 2004, the company built itself around releasing digital, episodic games first on PC as digital took off there, and now for the consoles. Telltale's co-founder and CEO Dan Connors spoke to GamesIndustry.biz about what prompted that original decision and how he sees the digital age progressing from here.
Q: Telltale has always released its games episodically, and releasing episodically and digitally was nowhere near as popular five years ago when you formed as it is now. Why did you make that original decision?
Dan Connors: Well, first I would like to take some credit for the popularity because I think Telltale's execution of it has helped make it a more tangible goal for people that have wanted to do it. I think five years ago it was a theory and I think now there's a tangible way for people to see how it could be done. But when we set out, we set out to build a company that was about taking advantage of digital distribution which we felt was going to be the next big paradigm shift in the business. And that really created a lot of options to rethink the way things were done.
We really felt like episodic would create a real opportunity for our games and our storytelling games, create an opportunity for us to have an ongoing relationship with people who play our games and to keep them engaged in our stories over time.
The episodic thing five years ago was starting to take off on television as well, with a lot of different series like The Sopranos becoming a regular form of entertainment. We felt that what Telltale was going to build with the onset of digital distribution was gaming's version of almost television style production. And going episodic stemmed from that standpoint.
Q: Episodic does sound great in theory. And there are a lot of games – Alan Wake and Alone in the Dark spring to mind – that would lend themselves perfectly to that cliffhanger, TV style format. So why do you think many developers are hanging back from using the episodic model?
Dan Connors: Well, it's really hard for a company to transition its model. When Telltale started we set out to be an episodic company – we set out to build from the ground up to be episodic. So every decision we've made up until this point has been about delivering episodes. I think for other companies that have been around and have been in the retail ecosystem for a long time, it's a major change in thought process and production process and business mindset. And if you're going down one road and you're keeping your business going from one business model, making a dramatic shift in that business model is a huge step to take. And unless people can see exactly how it should work they're not going to make that jump.
Q: Do you think episodic could be the answer to one of the problems digital distribution is facing that a full size game can be a hefty download all in one chunk?
Dan Connors: When we set out to build episodic a big part of it was to make content that was easy for users to get. We did feel that size was still a barrier to entry for a lot of people and that smaller chunks made more sense in a broadband world versus a disc based data storage world. So that was certainly always part of our plan. Lower price point and smaller data footprint were more consistent with the way goods are distributed in a digital sense anyway.
Q: Do you think releasing onto formats such as PSN and XBL is going to be important for Telltale going forward?
Dan Connors: Oh yes. We definitely believe that the connected consoles are going to be major players in defining the future of entertainment. Right now they have a really good position, as far as being in people's living rooms, connected to their TVs and where families go to have entertainment, so as their digital channels get easier to use for more people, it's just going to make sense that more and more gamers are going to migrate to getting their content this way. Obviously the consoles have really large install bases of people who love to play games, and we want to be in front of all of those people for sure.
Q: Do you think there are any genres of games that don't or wouldn't work using the episodic download model?
Dan Connors: I would never say anything can't be done – that's just my nature. That's how we ended up building Telltale in the first place. But they all have different challenges and I think what you need is something compelling each time out, so obviously with a story and a cliffhanger there's an ongoing story and ongoing character development and characters that people can enjoy and get engaged with. Having people come back to them every month and engage with them and hear a new story about them, that makes a lot of sense. Having someone come back to something every month to play the same level of the same type of game, that presents different challenges.
So people would really need to figure out from a mechanics standpoint how they're going to lay out the gameplay experience in such a way that the user's going to be compelled to get back in. It's really easy for us to say 'you have to get episode four because you've got to see what happens next with Guybrush. It's probably going to be harder from a messaging standpoint for a game that doesn't have a story hook to get people to come back. But it's certainly not impossible. PAIN on the PSN seems to be an example of something where they add interesting new pieces of content that updates the game on a fairly regular basis and people seem to be really attracted to whatever the new thing is.
Q: So within a series of episodes, how many players drop off from start to finish? How many would, for example, download the first free one, then perhaps not return?
Dan Connors: Well that's Fable's model, that the first one satisfies the need for the product and when it comes time to sell the second one, they've already had enough Fable. Unless they can make something really compelling in the story to move people to the next one, then they run into that problem of converting them into paying customers. So they're going to need to convert them again.
Now the good news is they have an install base to talk to. At Telltale what we found is we've had success in selling the season at a discount – selling all of the episodes in the season – and then it really changes the attitude of the player because they've bought in. They've already bought the game and when the new game comes, they're anticipating it and they're excited to get it, and consume it and get ready for the next one.
It's not like they need to be sold again, it's like they're getting an exciting thing in the mail, or an exciting email or something. We've found that people that want to pick up all five and sign up for subscription look forward to that monthly subscription like you look forward to your favourite magazine, or anything you would care enough about to get a subscription to.
Q: And Fable II also has the advantage of letting consumers buy it in a box or download it. Which smaller developers may not have the luxury of doing. Do you think signing with a publisher is still a good option if it enables a studio to take both routes to market?
Dan Connors: I think it has potential and I think there's a lot of opportunity. We've built a lot of content in our multiple seasons and they could be packed up as many different types of retail products. Like a best of, series or holiday special with all of our Christmas or Halloween specials from Sam & Max. There's a lot of different opportunities as far as what you can bring to market and if you can find a flexible publishing partner who is interested in exploring different ways of selling the content then I think there's a lot of opportunity there.
Q: In your experience are publishers willing to experiment in that sort of way?
Dan Connors: I think they all feel like they need to start making moves into digital. And I think there's certainly a need to try new things, and marketing departments are always looking for new ways to sell the games. So I think there's still interest, but a lot of the energy in the bigger companies is going towards their big fall Q3/Q4 releases and that's what the bulk of the company is riding on. Focusing on anything that takes energy away from that is difficult for them. There are a lot of publishers out there looking for more cost effective ways to be in business using not just the big blockbuster model, and those are the partners that are going to be flexible.
Q: Telltale is very proactive in communicating with its community. It's something Charles Cecil spoke about recently – that he believes people are more likely to pay for games and support them if they come from a company they have a relationship with, instead of a faceless corporation. Is that a sentiment you agree with, and was the community aspect a conscious decision you made?
Dan Connors: I don't know how conscious our choice was. We knew we wanted to build a website. We knew we had a lot of good voices to talk to fans with what we were doing. And we just let the team treat the community like they were all friends. Our corporate voice was a friendly one. We heard what they said and sometimes we pushed back, sometimes we engaged the conversation, sometimes they'd say stupid things, sometimes they'd flame. But I think people feel very much like they know Telltale, and that certainly has created a really strong core for us to work with.
I think the most exciting bit about the whole thing is when we're building the episodes, the level of engagement with the community has led to this creation of the game that's almost like doing live programming in a way. We're building the game and we're talking to the community at the same time, and there's a real strong connection. It's not like we're alone in a vacuum building something that we hope people will like. We're building something that people are telling us how they feel about and we're engaged with them and I think it leads to a different experience. And it's really only the tip of the iceberg so far as how you can integrate community into the games that you're building and the entertainment that you're building.
Q: PSPgo has just been released and is the first games console to really make a bold step in the digital world. What do you think of it?
Dan Connors: I think kudos to Sony for continuing to push the envelope. You look at the number of games that are selling on the iPhone and it's a pretty safe idea for them. And for us, as a digital distribution company that builds content the right size and a style of play that maps easily across multiple platforms, we're always happy to see someone pushing out a new platform and making it possible to get in front of new gamers. I'm very impressed with this step that they're taking and as we continue to move towards handhelds, it's certainly going to be part of our plan.
Q: You've expressed an interested in working on iPhone and DSiWare platforms, so PSPgo is another one you're also considering?
Dan Connors: I definitely think there's huge potential there and right now we're working on getting our content over to some more channels, over to new consoles and the Mac. And after that's done, we're going to be looking at handhelds. I think we have to consider the PSPgo for sure.
Q: All of these emerging distribution platforms – DSiWare, WiiWare, iPhone, PSN and so on, they're making it much more possible for smaller, possibly more creative individuals and teams to get their games to market. Is that a shift you welcome?
Dan Connors: Oh, I think the way distribution has diversified and has opened up new channels has created, already, many different new genres and styles of play that I don't think we would have seen. And I think, in the big picture, the Wii has really rocked things. It's really rocked people's perceptions and what type of gameplay experience people are expecting and who's a gamer. I think that Rock Band and Guitar Hero have really changed the face of things, and then I think the third big thing is the fact that digital distribution has made it possible for people to create games that don't need to reach a huge audience, they just need to reach a big enough audience that can support the product and support the companies so they can continue to go back and reinvest and push from an innovation standpoint.
So I really think it has made it possible for an idea to become a game and it's possible for that person with that idea for that game to create a business around it. Anything that was happening before was all amateur and now it's becoming professional and therefore there's more energy being invested in it and a higher level of commitment because obviously if you're doing something for a living, it's something you put all your time into.
Q: Do you think that prior to digital finally coming to the distribution fore, game companies were becoming a bit guilty of, like the music industry, getting stuck in their ways and not thinking outside of the box?
Dan Connors: You know, it's hard to say because the games industry has moved so fast. It's hard to compare it to some of the other industries like the music industry because the music industry took 20 years to develop different ways of doing things whereas the games industry seems to be turning a lot faster. World of WarCraft – the transition from MMOs to Everquest to WoW - has seen a huge evolution and that's taken place since the late '80s or so.
I think games have always been evolving aggressively, I think they never stagnated too much. One area in which they have stagnated, from around 2000 to 2004, they seemed to be really trending towards just serving a specific audience and demographic. The games had to appeal to a certain group of people, so you started to see more and more shooters and driving games and sports games, and other games weren't being explored. And I think that's certainly changed.
Q: What innovations are happening now that you're particularly excited to see the outcomes of?
Dan Connors: I think Natal's interesting and that's going to be fun to watch and see how people continue to evolve products in that way, and what people can do with it and how it drives the next generation of games. I think you're going to see a lot of people putting a lot of energy into creating new things around it and it should be interesting to see what comes out. I think that seeing what the iPhone has been able to do and seeing how many people you can reach through the app store and how many people are on iPhones and how savvy that audience is - I think it'll be interesting to see what sort of games are built there.
I think the next big step is going to be a connection between full blown retail quality or downloadable quality games, core games, with social networks and with handheld devices so that the game is becoming connected on multiple levels. I think that's going to be a very interesting area where people are going to start moving to where there's going to be some type of game that's going to be able to connect people, through multiple ways, through their Facebook account and through their iPhone and however people want to do it. I can't say what it will be, but I think it's going to be an exciting area.
Dan Connors is CEO of Telltale Games. Interview by Kath Brice.