Top 10 of 2009: Interviews

Mike's words in January were a pretty accurate assessment of how the year would follow.

Mike Hayes, SEGA (January)

When we spoke to the then-boss of SEGA Europe (since promoted to a more senior role), the industry was still digesting the Christmas 2008 sales data, and wondering if previous widespread predictions that the videogames business was "recession-resistant" - not "recession-proof" - were really going to hold true.

Back then he was cautious about what lay ahead, and in light of how events in the following eleven months transpired, it's interesting to look at what he identified as the key challenges, and how they shaped the year as a whole.

Q There have been recessions before, and people for the most part seem confident that the games industry will emerge relatively intact - what are your thoughts on the current economic climate?

Mike Hayes: Well, there are definitely three ways in which it's different. The first thing is credit - it's a big issue. You can't get credit in Eastern European countries, it's harder in the Middle East, there's no credit insurance. You've got retailers where credit's on hold, like Toys R Us - even though people aren't going to stop buying videogames, our ability to get through the channel is harder.

The second thing is retailers, definitely in the United States, are being far more prudent in what they buy, so they're clearly going to focus on the triple A titles, but their day one orders are coming down. What they're saying is that they'll take in as little as need to, see how it sells through, and then they know they can order again in a matter of days if not hours. So that's hurting us.

But I also think that this time around there's definitely an oversupply of good games in the market from publishers. I think that was very evident in the UK at Christmas when you had fantastic games coming out and selling great in the first week, maybe two, and then falling off a cliff.

He also identified the risk to new IP, something which was a tough ask in 2008 and has proved to be a significant challenge in 2009.

Q: Microsoft is investing in the Halo universe in that way, for example. But it does make you wonder that if the industry is cutting back on new IP, then further down the line... For EA I'm sure they'll look at new content around Mirror's Edge and Dead Space in the future, but those aside, might there be a genuine lack of choice and variety further down the line - and if so, what will that do to the industry?

Mike Hayes: I think that's a very good point. From our side, we're going to balance it. We're going to do three broad things - we'll take on existing franchises and innovate, like the Football Manager 3D engine, FML, and we've got some interesting stuff on the future of Total War, and where we want to take that, because times are changing and online is becoming far more relevant.

Secondly, we will go for the new IPs, the MadWorlds, and so on. And the third point is that we will constantly try to reinvigorate what we've had before with new ideas. We've had limited success - Sega Rally was a great game, but didn't press any buttons. Samba de Amigo was a great game on Wii, but it didn't really break out.

But we do have that catalogue that we like to look at. There are a lot more things that we can do properly with Sonic, where we develop in the West. Sonic Chronicles on the DS is an excellent game - not commercially huge, but an RPG on the DS is never likely to be so. It was a nice, profitable, critically-acclaimed game. Sonic needs that quality to come back into it.

So we think that if we balance those three things, we're not going to get it all right, but hopefully if we can get one new IP out of that in the next two years, we'll be delighted.

Hopefully other publishers will take that mixed approach, and that balance will get us through.

Sean Brennan, Bethesda (May)

As the year progressed and more publishers looked for ways to cut costs and trim headcount, Bethesda - owned by Zenimax - was eyeing up acquisition deals instead. id Software was the one that came off, although don't be overly surprised if (assuming a row over Half-Life and Counter-Strike IPs is sorted out) Valve isn't added to the stable in 2010.

We spoke to the company's European MD in May (a month before the id deal was announced) he outlined the extent of the success of Fallout 3.

Q: It's been just over a year since Bethesda's European base was established in London, what have been the areas of progress in the first 12 months, and are you pleased with progress so far?

Fallout 3 had sold almost 2 million units across Europe by May this year.

Sean Brennan: For the past 12 months the key focus was Fallout 3, and only Fallout 3. We had a couple of other SKUs that we bought to market that we didn't really focus on. The issue in Europe was we were a new publisher, first of all. It was a big challenge because of the numbers we're expected to generate, and that the title deserved to generate, were quite significant. Even though we're well funded on the marketing side, it was a big fight on our hands to get this title in the top ten at Christmas time when you're competing with established franchises.

Fallout wasn't a franchise even though it's got the numeral, we perceived it as a new brand because the last Fallout product came out ten years previously, it was PC only and it wasn't necessarily a huge hit. So it was a big challenge to focus exclusively on that with a small team. Pleasingly, we did very well, and in the UK market to date we've sold through over 750,000 according to Chart-Track, and in Europe overall we're close to two million sell-through. That's some big numbers that we've managed to achieve on the title. What's particularly gratifying in the UK is that we've established relationships with all key retailers and the support we got from them was quite staggering.

He also talked about what the European arm's focus was moving forwards, and why there's every reason to expect more titles from Bethesda in the forseeable future.

Sean Brennan: One area we have flexibility is on the product side of things. We've been looking for product for Europe only. There's going to be one particular deal that we're going to be announcing soon on that side. Again, just to qualify the point, we don't need to pick up titles just to fill holes or fill gaps to generate revenues, because quite frankly we've got a load of money in the bank. We don't need to be constantly generating revenue gratuitously. Strategically, if we look at opportunities where we can publish titles in Europe that are high quality, if the rights are only available in Europe, we'll do that – and there are some deals we'll be announcing on that side of things soon. And then in general terms we have to take a global view with big brands. Our marketing strategies will be broadly similar on a global basis. It's that old cliché, think global, act local. We wouldn't take a different approach on marketing or price, because we're operating in a global village.

Q: As well as the expansion into Europe, there's also an expansion in your portfolio of titles. Are European developed titles something you are specifically looking for?

Sean Brennan: We need to grow as a company, and that's why we raised USD 300 million 18 months ago. And it's something we need to show a return for our investors over the next few years. But we'll grow in the right way. So far, in terms of the European development community, we really want to take that to the next level. We've signed the Splash Damage deal, and its first title with us is going to be shown at E3. We're not announcing the name yet, but it's a first-person shooter. That's a product that we believe is a genre-breaker, it's a real killer app. From a quality perspective we're pitching that along the same lines as Fallout 3. We've kept it under lock and key, there are so many innovative features in there we don't want to reveal them too soon. We've spent significant resources developing the title. And that's a great example of our European work.

We are looking at other [partners] in the UK and Europe, at a time when a lot of more publishers are taking more product in-house because they feel safer with such big budgets. We're working more with external development, which historically we've not been as good at as internal development. We're looking in Europe, and whether that is just acquiring products or acquiring studios, it's about whatever makes sense and we'll look at all possibilities. Certainly in the UK and Europe the next stage for us is that we've shown development how we can publish big global hits like Fallout, now we're in a situation where we want to develop relationships with key people and really expand the portfolio in that way.

Mike Griffith, Activision (June)

Heading into 2009 the newly-settling Activision Blizzard had become the world's largest videogame publisher, with super-selling key franchises that included World of Warcraft and Guitar Hero, plus the small matter of the (just-announced in June) Modern Warfare 2.

But the first half of the year hadn't been quite so super for the music genre titles, so with Guitar Hero 5, DJ Hero and Band Hero all arriving before Christmas, how was CEO Mike Griffith feeling about their prospects?

Q: Has it been challenging integrating a hardware business into a software company?

Guitar Hero 5 was one of the company's biggest launches, but it was a tough year for the music genre.

Mike Griffith: It started slow and organically and it felt more like an evolution. In the early days we had a lot of difficulty manufacturing enough guitars and a lot of difficulty with our logistics systems. In the early days of Guitar Hero we added capability and built a lot more support with people on the ground in Asia and logistics in Europe and North America and now we're pretty good of it.

Q: Does hardware compress margins significantly when you're selling it alongside software? I imagine it's not so much the case with Guitar Hero but with DJ Hero and Tony Hawk: Ride do you have to bite the bullet and take a hit on profit in the first six months of release?

Mike Griffith: We're as much focused on giving the consumer a great experience as we are giving the share holder a return on their investment. We don't really break our goals out item by item but I can tell you our objectives of delivering a return apply across the board.

Q: Do you expect peripherals to remain a significant part of this generation of console gaming?

Mike Griffith: They're going to be a big part for the rest of this cycle. The consumer has seen the advances in this technology, and seen peripherals take advantage of technology to deliver a more physical interface. The consumers has been very accepting of that and it's bought new consumers into gaming. Having said that, I don't think peripherals are taking over the gaming market. There are games like Modern Warfare 2 that don't require a peripheral and perhaps a peripheral would get in the way.

Q: Bundling peripherals with software makes the overall package expensive. You haven't seen a reaction from consumers that maybe this is getting too expensive?

Mike Griffith: We haven't and I think the consumer is saying if the value is there in terms of the entertainment experience then the price is fair. If you also look at in the economic downturn, traditionally stay-at-home entertainment vehicles have done better. Part of that is recognising the value that a videogame delivers. If you look at the extended life of a game, take the purchase price and divide it by the hours played, videogames become a very attractive prospect. While consumers aren't calculating the hard numbers, intuitively they understand that you can buy a videogame for about the same price as taking four people to a movie and it'll keep those same four people entertained for longer.

Kristian Segerstrale, Playfish (July)

While EA's acquisition of Playfish was one of the biggest business deals of the year, none of that had happened when we spoke to CEO Kristian Segerstrale in July. In fact, one of the things he talks about is the publisher entering the social gaming space, funnily enough...

But before that, as the company celebrated its 100 millionth game download, he offers his thoughts on the iPhone, and how influential that might become.

Q: What's your opinion of the iPhone and what Apple has achieved since it moved into mobile gaming?

EA acquired Playfish in November in a deal worth $300 million.

Kristian Segerstrale: I think the iPhone has been an important milestone in the games industry for a couple of reasons. The main one being that they have ignited the expectations of consumers that you should be able to have high quality gaming experiences on devices which are not fundamentally gaming devices. And bringing that marketing message to the consumer I think has been incredibly important. Also I think Apple has done a lot to create a model, if you like, digital distribution eco-system with the App Store.

Having said that, I actually think the iPhone and App Store have a very long way to go. The steps they have taken in the mobile gaming world is amazing - they've created a user experience which is unrivalled. But the environment is still a catalogue one - an environment where it's very hard to be successful unless you happen to have the breakaway hit. And even with a breakaway hit, you end up with a price war down to 99p. The economics of that marketplace haven't been that great. What I think is the most exciting thing that Apple has done is the 3.0 software update and the direction the platform is taking from that. They are actively encouraging games on the iPhone to become a service - I think that's really important.

They still have steps to go - I think it should be possible for consumers to get games for free and then pay for additional features - something currently not possible as you have to pay something up front if you want to pay for features. Also I think Apple should be far more aggressive in encouraging viral distribution of its games because viral discovery, as we've seen with social networking, is very powerful in broadly distributing games. Implement social discovery, where you can check out what your friends are playing and you can better figure out what the people around you are up to and you enable an application distribution environment where quality genuinely rises to the top.

They have things to do still, but they have made an admirable effort and in many ways iPhone will be seen as a very important turning point or early milestone in where the games industry is going.

Q: What would you say your company's mission is going forwards?

Kristian Segerstrale: Our mission as a company is to change how the world plays games. We believe there is a humongous opportunity in getting people more engaged in games by getting them to play together. It's like ball games in the park and board games at home played throughout the ages, you're communicating and having fun with friends. We're trying to bring games back to that form of entertainment. It's not about you sitting at home with the lights off in front of your plasma TV killing monsters. It's a fun, social, casual, everyday activity with all your friends. Our mission is to transform how the world plays games. The PC might be where that starts, but our belief is that handheld devices connected to the internet where you can connect with your friends are important, and that's why we're excited about iPhone and Android for the future. I think that games consoles - while they might be an important part of the industry now - might become niche in the next couple of years because it's not at all clear if it even makes sense to deliver this type of gaming - social, with micro-transactions - on a home console.

Q: EA has spoken about wanting to get into the social gaming arena - how do you feel about that?

Kristian Segerstrale: We absolutely welcome them. In fact, they are already there with a number of games on Facebook. They clearly believe, much as we believe, that games are becoming services and that retail distribution for games will decline quite rapidly from here onwards. And I think that the most important thing for social games is to ensure the quality of the end user experience. The social game experience is growing and continues to grow and we've been at the forefront of that and have been very pleased with where the industry has gone so far and with how the consumers have embraced it. The only threat that I see to the industry is that in the search for early profit and maximising early results for companies, companies will act overly aggressively in how they try to monetise users, which is not good for anybody. A bit like, if you remember what happened to ringtone subscription services in Europe - where there was a bit of a consumer backlash because the way people were paying wasn't transparent. I think it's great to see companies like EA have a bigger presence in the market because I think they will help set the quality standard and ensure people get what they've paid for.

Q: Your company received a big cash investment towards the end of last year - how's it being spent?

Kristian Segerstrale: We announced our launch on the iPhone and Android. We also launched on other social networks such a iGoogle, Bebo, Yahoo and other places. We've been pretty busy, also continuing to work hard on Facebook and MySpace. Since then, Pet Society, our biggest game, has grown to 12 million monthly active users - which is more than World of Warcraft. We've grown tremendously over the past six months. Our most recent title Restaurant City reached more than 54 million players in the ten weeks after launch.

Danny Bilson, THQ (July)

There's no doubt that 2009 was a tough time for publishers, with most making cuts, and some - such as Midway - finally succumbing to the pressure.

THQ was no exception, and went through what's been described as a "reboot" to put it in a better position to tackle the future. Here, executive VP Danny Bilson explains the philosophy of THQ 2.0.

Q: You talk of a 'new THQ' which is encouraging to hear. Was it difficult convincing the old THQ that this is what they needed to do? To adopt these systems and refocus the company on the quality of the product rather than trying to please investors?

The decision to push out titles such as UFC 2009 during traditionally quiet periods paid off for THQ.

Danny Bilson: No, because they were in a failure state. A team that's in the play-offs every year rarely wins a championship because they're risk averse. They're steady. A team that's in the toilet can rebuild and you're allowed to throw out old assumptions and it's easier to actually instigate change in the system.

We're willing to take on risk, so you're seeing giant leaps up in quality as a result of radical change. We didn't have to fight those legacy issues because they clearly weren't working as they wanted them to be. It was a legacy of something. I'll be fair to my own company with Saints Row and some of the wonderful successes they had with the Nickelodeon brands, but the market changed on them. We have to be agile and we have to move fast, so I'm all about driving and moving fast.

Q: So what's the current creative vision for THQ?

Danny Bilson: It's really simple, it's the games. I'm not being glib. How will I build the portfolio? I'll ship three shooters in a year if they're going to be 90-rated and awesome. Good games sell like good movies sell. You don't have to worry about diversifying portfolios and making a pet vet game because everyone else has one. If I had another shooter I could makes us another USD 20 million, so what are we talking about? It's about good.

Q: So THQ doesn't feel like it has to compete in each genre and have a diverse portfolio for multiple systems?

Danny Bilson: How does that even makes sense, I don't understand that? It's funny, but why do I need that? If I had something good for every genre I would do something good for them, but if I have two strong shooters and as long as I'm making the revenue and selling games and people are digging them, I'm good. Maybe I'm completely wrong and mad, but I don't get 'portfolio'. UFC: Undisputed did two million units in two weeks. It's wild in places like Germany and the UK. In Germany the UFC doesn't even play there.

Q: Did THQ's financial situation put a squeeze on your operations or hold back any changes you've wanted to make as part of the new THQ?

Danny Bilson: It's an interesting point and I can make it really clearly. We shut down a lot of studios and laid off a lot of people – 550 – in product development so that others might live. The studios that lived through that didn't get hit at all and they got more money in order to get to quality. The guys who are left didn't feel the pinch at all. We spent millions more on Red Faction: Guerilla at a time when we were closing and contracting all over the place because we have to win in the end.

The key to this whole thing is you've got to have people in your organisation who know what a good game is. I can't overstate that because actually there are a lot of people who don't know. I play a ridiculous amount of games, I've played games since 1977 when my father handed me an Atari 2600 and I was on board games before that. That's all I do, I love and play videogames, so I have a sense of what a good game is.

It's all from personal experience and there are lots of people who also have that. You have to be able to know what's wrong with a game and be able to identify that and figure how to fix it and not ship it. You've got to figure out how to fix it in a cost-effective and timely manner.

David Perry, Gaikai (July)

One of the biggest talking points in the first half of the year was undoubtedly the OnLive reveal at GDC, and both advocates and detractors of cloud gaming tucked into the ensuing arguments over viability and execution with avarice.

But a little later in the year came the first details and demonstrations of another cloud service, Gaikai, being set up by serial entrepreneur David Perry. Here's what he had to say of the project when we caught up with him in July.

Q: Obviously there will be a lot of people who have maybe had problems with MMOs and lag, or other core online games - but they've already got their set-up, and they know about games, so are you even going to have to market to those people to persuade them?

The Acclaim COO has an interest in a number of industry projects, cloud computing being one of them.

David Perry: Gaikai is not built for hardcore gamers - those are the guys that want HD, 60 frames per second, who are happy to sit for an hour and a half, download and install it... that's just not our audience at all - it's trying to reach out to new players, the hundreds of millions of people who never touched Mario Kart but would like to. They don't know it yet, but when they click - they're clicking on games on Facebook, on their iPhone, on MySpace, on Flash games sites - and they haven't experienced games like EVE Online, or Spore, or LEGO Star Wars. They haven't bought a console yet, they're not there yet.

So that's the audience we're going after initially - and it's a very different approach. To them it will be shocking: "Good God, what the Hell is this?" And that's the experience we want people to have.

Q: It's pretty easy to think of the core audience and worry they won't be persuaded, when it's not for them...

David Perry: Absolutely - ultimately, if we can grow an audience, at the end of the day that extra audience brings value to the game. So if a company puts their game out and we can double that audience because of extending that reach into places they couldn't reach, that's more revenue for the company, and hopefully they'll invest more into the game, or future games - that's really a good thing for everybody?

Q: What about the servers? It'll need a lot of hardware across the world - do you start in the US? How many do you need?

David Perry: Well, there are two different approaches - one, you build a network that's gigantic and hope people come, and the other is to build a network based on demand. If you advertise for traffic - imagine I was to go in all the movie theatres, or put banner advertising all over Brighton, for example - and all these people show up, there better be servers for them. If there isn't, then all that peak traffic that came in is going to be wasted.

You can't have that, so you have to build a network that's ready for the peak traffic, and there will be lulls in that traffic, and you'll have servers eating power... it's quite a complex equation. If you were making that order, how many would you order on day one? That's the peak traffic solution, that's what OnLive is going to have to solve.

Q: In terms of geographic location, how will you approach that to begin with?

David Perry: Well, it varies. I can go from my house to Las Vegas in 17ms, but doing that distance again is 93ms. That means that there's no connection between Las Vegas and the point further on, so it must go around in a circle - it's the only way you could cause such a huge spike.

So that's the real internet - it's a messy beast. What we did was look at a map of the internet and saw all of the hotspots, where the numbers were getting too big, and just filled those in. In the UK we'll effectively reverse engineer.

The second part is that we don't actually know which server will be the best for you - if we have a server in Brighton and you're on the other side of Brighton, that might not be the best server for you because it might be going in a loop to get to you.

So we take, geographically, all the servers around you that we have and you ping them all. That's what the load time is, if you saw the Gaikai demonstration, the text coming up in the corner is it pinging all the servers around to see what the best one is. It then logs on to that one, creates an instance, and the game starts to play. That means that you're guaranteed, whatever your situation is, to get the best server.

Secondly, we choose the compression based on how fast your processor is and how much bandwidth you have.

Q: So in theory, depending on your location, you could have a slightly different visual representation of a game to others - but not materially worse, because the option won't exist if so?

David Perry: Well if it was no good people are just going to keep bailing on it, and we wouldn't let that happen. If we saw people bailing we'd ask what was going on, and see that they're getting a 250ms ping time and stop it.

Yves Guillemot, Ubisoft (August)

Ubisoft is something of an enigma at times. While most of the rest of the videogames industry set some sort of restructure in motion in the past 18 months, the global economic slowdown seemed to pass the French publisher by without any real fuss.

Instead it continued on its path of rampant expansionism, announcing a new 800-person facility in Toronto, adding to other big studios not long established in places like Singapore.

Here CEO Yves Guillemot talks about the philosophy of preparing for new platforms and new technology, not the least of which will be Microsoft's Natal in 2010.

Assassin's Creed II was one of the most anticipated titles of 2009 and a key pillar for Ubisoft.

Q: It's been a turbulent twelve months for the industry, during which time a number of publishers have made cuts to their business - yet Ubisoft responds by setting up a new studio in Singapore to grow to 400 staff, and another in Toronto to grow to 700... how is it such a different path to others?

Yves Guillemot: Well, it's not everyone else. Activision is growing fast, and there are some other publishers that are growing. So we try to be in that league, with the guys that create high quality games.

What we've seen is that there are still lots of opportunities in this industry, and we have to get ready for the next generation of consoles. I know each time I say that, everybody says that we don't know when they will come... but what we've seen is that when you don't actually have enough creators to make the games when the new consoles start, you can't take the time or have enough energy to use the capacity of those consoles.

So the goal is really to try to be there with a good team that's capable of using all the potential of those new consoles.

Q: Obviously you'll talk to the platform holders about their future plans, but isn't there a risk that - particularly in the current climate - new consoles coming to market could be delayed, and you then have to bear that ramp-up cost for longer?

Yves Guillemot: For sure, it's a risk. What I've seen all the way in this industry is that without risk you have less success. You have to take risk to have a chance to succeed.

I believe that this industry will continue to grow fast, and that it will be a very large industry. I think it interactive entertainment will grow in picking up the businesses that are around, like the movie industry did a long time ago.

That's why we believe it's time to invest, because it's the right time to continue to expand the brands we're creating, and to make better games. Because we wanted to come here this year with another level of quality.

On some products last year we were not as happy as we wanted, so this time we've been investing more to make sure that everybody will be happy with the games that we launch.

Q: Talking of new technologies one of the new products we'll see in the next year is Natal from Microsoft - do you think you'll be well-placed for that? Ubisoft was proactive in its approach to the Wii at launch, and it's yielded rewards, so are you hoping something similar may happen with Natal?

Yves Guillemot: I think Natal will be impressive, and bring something new to the industry. We've certainly been working on a 3D camera for a long time, before even Microsoft came to us with that, just because we thought it was a good way to improve the experience and make sure we can include more gamers.

So we want to be strong on that new accessory, that new way to play, but there are plenty of other things that will come along that will be interesting. That's what I love in this industry - always new things.

Frank Gibeau, EA (August)

2009 has been one of the most important calendar years for the former world number one publisher as it seeks to redefine itself for a new era in the videogames business. On the one hand it started the year by making cuts in a number of areas, while it ended by snuffing out Pandemic and acquiring Playfish for $300 million.

In the middle of that it launched some crucial new products, including The Sims 3, reshuffled its already recent label line-up and saw existing franchises crash previous sales records with FIFA 10.

So what did EA Games president Frank Gibeau make of it? Here he outlines his thoughts on a tough business climate and the challenge of launching new IP.

Q: It's been a turbulent 12 months for the industry - how is business for EA Games, and how do you feel about your position ramping up for a busy end of year?

Double Fine's Brutal Legend was one of EA Games' pre-Christmas new IPs.

Frank Gibeau: I feel really good, very bullish about where we're at. The line-up that we have is spectacular - it starts off at Christmas with Dragon Age, Brutal Legend and Need for Speed: Shift.

I really like what the team's done this year with Need for Speed, really trying to reset the quality and go in a new direction with the brand. And Brutal Legend was a nice add to the line-up - every year we want to try and release one or two new IPs, this year it's Dante's Inferno and Brutal Legend.

The industry really needs those fresh ideas coming in to rejuvenate things - it's always risky to do, and sometimes I wish I had more sequels, perennials, but we've got those too with Need for Speed and Mass Effect.

With those three at Christmas I feel really good at the start, and then Q4 we've got a spectacular line-up with Army of Two, Dante's Inferno, Mass Effect 2, Command & Conquer 4... then Battlefield: Bad Company is a killer.

I don't know if you've had chance to play the 1943 download game on Xbox Live? It's doing very well for us, it's a direct-to-consumer play, sold about a million units so far, and it's a perfect set-up for the next Bad Company.

So right now we feel like we went through a lot of pain, but we're coming out stronger, with very focused teams. The people that are with us are focused on the games, they really want to be there, they really believe in the company, in the brands they're building, the IPs they're building.

Actually I feel really good. I'm excited about this week [at Gamescom] because we get to see what 200,000 rabid fans think of our games - that's always kind of nerve-wracking at the same time as exciting, but overall I feel good.

Q: Last year was tough for new IP - what lessons did you learn from Dead Space and Mirror's Edge?

Frank Gibeau: It's a great question - there are probably a couple of things I'd add to the context around Q3. There was a severe economic downturn, which caused a flight to quality... not just that but also frankly a flight to things you already knew. So Need For Speed, FIFA, Call of Duty, Madden - you had a good sense of what you were going to get.

If you look at the charts it wasn't just us, it was everybody - there was a complete polarisation of the market place. It was very brutal in the UK, with Woolworths and the other accounts going down - there was an incredible flight to known quality there, and in the US the same thing. So that made it harder.

The other two issues I believe: We didn't start early enough on our marketing. You have to build a fan base, you have to build it early and in a credible way, which means you've got to get your assets, your concept and demos out very early on - much earlier than you would with a sports of driving game. So we started our marketing two quarters earlier this year.

The second thing is that you've got to find the right windows. You can't just launch in the middle of November on top of everything else, so we brought in Brutal in October - it feels like we found a nice clean launch window there. We originally looked at putting Dante's out at Christmas, but it just didn't feel right in terms of the products that are coming, so we found a nice window in February where we think we can really stand out. It also gives the team a lot more polish time, and we want to make sure the team has that last three months to really make the game perfect.

So a combination of those three issues is giving me a sense that we're going to be much stronger this year, and in addition to that we've also looked at how much money we need to spend up front, at launch, how we sustain it, and then online.

Yoichi Wada, Square Enix (November)

The biggest business deal in the videogames industry this year was the announcement early on that Square Enix was to acquire UK publisher Eidos, and with it bring together some of the most powerful brands in existence - Final Fantasy and Tomb Raider in particular.

While we spoke to the company's global president, Yoichi Wada, on more than one occasion it was the latest interview in November that was arguably the most interesting - particularly in view of how the merger had settled down, and what still needed to be done.

Q: What's your evaluation of the company's business performance since the acquisition of Eidos?

Following the Eidos acquisition, Square Enix is home to some of the best-known brands in gaming.

Yoichi Wada: Well, it's been 119 days since the integration, and the process has been very smooth. The organisational integration is almost fully complete.

Just last week we had a Town Hall meeting of all the employees here [in Wimbledon] so that I could congratulate them on the integration and their hard work going forward.

So, as an organisation we've completed integration and we want to work harder on the exchanges between the studios - in fact, this has already been happening.

Q: What do you mean when you say "exchanges" - is that culture or technology?

Yoichi Wada: For the exchanges between studios, I mean both things. When it comes to cultural exchanges I think it would be inappropriate for us to have just a single cultural entity. Through integration and exchanges we may come up with something totally different to what we had previously, where it can be new, but with something from the past remaining within ourselves.

Having a single cultural identity would be, I think, the wrong path to pursue.

This office here is now called Square Enix Europe, but we've intentionally left all the studio brands as Eidos, because we want the original culture to remain.

Q: With the integration complete, what's been the impact on head count - and is that something you were trying to avoid where possible?

Yoichi Wada: There's an ongoing process of reshuffling people, but that's not something we do just because of integration. As an ongoing process that's taking place all across the organisation looking at all of our foot prints - Square Enix Tokyo, Taito and ex-Eidos offices, have seen about 10 per cent reduction of headcount globally.

Q: And in contrast, where do you see the main areas for expansion for the company - not just in terms of staff, but franchise line-up, genres, range?

Yoichi Wada: It's how we want to develop and nurture new IPs - we want to work on them very carefully and thoroughly, which doesn't necessarily mean just increasing the number of people. We won't blindly launch new IPs, but we'll take time with each one so that they can be successful.

Of course, being a games company, developing and manufacturing is where we can create value so we'll be focusing on that portion of our business.

As far as the overall industry is concerned I believe the online business is very promising, and with the two companies coming together we have the capability to access a bigger player base - both in terms of more genres, but also having a greater geographical presence.

This is what we want to aim for - a global online business is what we want to work on.

Q: Post-combination, Square Enix certainly covers off a lot of genres and play styles - are there any areas which you feel you still have gaps that need to be filled?

Yoichi Wada: Looking at the titles we have in our portfolio, I think what we offer are games in which people can genuinely enjoy the game experience. When you watch a movie, you enjoy the movie experience, and I think we do something similar, bringing a game experience to our players.

As long as they're enjoying the games, the genre isn't so significant - be it action, adventure or RPG - as long as we have a compelling storyline and appealing characters... as long as the gamers enjoy the game experience, that's what we offer and what we'll continue to work on.

So it's not really different genres we're looking at, but by leveraging all the resources we have within the group I think that we can achieve our objectives.

For new things such as social games - I don't know if I should call this a genre or a new service - there's a communication between players which is interesting. It's something we're already trying to offer, and going forward we'd like to have a more solidified business place with these social games.

Andrew House, Sony (November)

Our final key interview in the 2009 list is Sony Computer Entertainment president and CEO, Andrew House. After taking over from the outgoing David Reeves earlier in the year, he oversaw the launch of the PS3 Slim and PSPgo, as well as a crucial price repositioning for the flagship product.

In this interview House looks back at his time at the helm and appraises the platform holder's position going into 2010 in a State of the Union-style round-up - another exclusive for GamesIndustry.biz.

Q: With the PS3 Slim in the market, and having increased sales of the platform by 300 per cent, you'll feel you have good momentum going into what's the busiest point of the year - how have publishers been responding to the increase in installed base?

The PS3 Slim was one of the key factors that helped Sony end the year more positively than it began.

Andrew House: Just anecdotally, it's been enormously positive. People have been telling us we've reached the price point they were hoping for, and as a result we've got the wind in our sales - that the market really is there for the PS3 to command.

I think at a time when we're seeing one of the major competitors somewhat losing a sense of momentum - at least in many of the markets I've looked at - it's gratifying to see a platform that's always had a very significant share of sales go to third party publishers capture that momentum again.

The knock-on effect can only be a positive one if publishers are making up 75 per cent of the sales on a particular platform, as opposed to a much smaller share elsewhere, then that's the platform I think it's in their interests to see succeed - and I think that's the dynamic we're seeing return right now.

Q: And the major competitor you're talking about is...?

Andrew House: From data that we're starting to see, in some of the publicly-released figures, we're seeing a significant year-on-year downturn for the Wii. I think that's just a factor of this Holiday season.

Q: What do you think you'll be looking back on next year as the highlights from the next couple of months?

Andrew House: I think what I'll look back on is tied in with the launch of the new PS3. What it says to me, and what third party publishers have said to me, is that we've finally capitalised on inherent brand strength that you had in the market place - that people were ready to embrace your console and did have a long-standing affinity for the brand and offering, but it needed to be at a value proposition that people were comfortable with.

Seeing us be able to establish momentum not purely based on price, but I think with a sense of capitalising on internal brand strength, is really gratifying for me.

I'm also very proud of the marketing efforts, and the marketing position we've adopted this year - because we've been able to stake our ground out with 'The Game is Just the Start' and 'The Whole World in Your Hands'. It strikes the right balance between saying, yes, we are first and foremost a gaming company and that's at the heart of what we do - but on the other hand we are now about being a much broader entertainment company as well.

I think there's been considerable scepticism about whether you end up being neither fish nor fowl, but I think we're showing you can still remain true to the core of your gaming offering, while at the same time seamlessly introducing other services and ranges of content.

I think the final highlight for me is just really starting to see that network effect in the growth of PlayStation Network - there are really substantial numbers coming on board there. As you've heard me say before, a network adds more value the more it grows.

I think that's great for the long term validity of a platform, so I think that's really encouraging as well.

Q: The PSPgo has been in the market now for a few months - it's come in for some criticism about things like price points, although I guess on one hand you don't want to cannibalise existing PSP SKUs, and on the other I'd be hard-pressed to find anybody who didn't think digital distribution wasn't the future of the industry... So is it a statement of intent, perhaps not designed for mass-selling at this point?

Andrew House: I think we were always fairly clear, as far back as the original announcements, that this wasn't a replacement for the current PSP-3000 offering, and that it sits alongside that and packaged media. It's additive to the business.

The early sales numbers that we've seen bear that out - I don't think there's been a huge amount of cannibalisation, and I think those sales have come in and lifted overall PSP sales.

It's clearly demonstrated that there is a consumer out there, and it's validated that proposition in moving more towards a digital download as a preferred means of getting content.

I think that it's part and parcel of the way that the industry is going to have to shift and respond as more of our content becomes available for download or digitally, and I'll get on to putting that in context in a second - but I think it just puts new demands on us in terms of how we think about the concept of merchandising, how we get people to browse, how we get people to sample.

Those are things still at a nascent stage in our industry, and there's an absolute necessity to work in tandem with our traditional retail partners in making that happen as well. Make no mistake, when you're looking at PS3 games and you're seeing the shift in the sheer size of the data that's becoming available, the packaged media business is not going away any time soon.

I think there's been an overstatement there potentially, and then a backlash to that - but I don't think we were really responsible for that overstatement, so we're not really part and parcel of the backlash, if that makes sense.

It has its place for those consumers - it comes back to offering people options, and it was the right option for us to offer.