Eidos life president Ian Livingstone was once again the host of the GameHorizon conference this year, and shortly before the end of the event GamesIndustry.biz caught up with him to find out his thoughts on how it had gone, and what he thought the main learning points had been.
Q: The industry's suffering from the economy somewhat - the plight of the Midway studio here in Newcastle is a case in point - but actually the people here at GameHorizon seem pretty positive. Why is that, do you think?
Ian Livingstone: Well, you've got some really good speakers here, the likes of Dave Jones, and so on. These are people that are well-respected who are outlining their visions of the future, and you've got a focused group of attendees who want to find out about the economic aspects of the industry - where that's going, how distribution channels are improving, consuming... it's a real crystal ball for the future, and from that point of view it's been very well received.
Q: What do you feel people will take away most from the event?
Ian Livingstone: The focus here has been on online - a lot of people don't understand where that's going, as a creator of content or a consumer of content. How people will be playing games in the future has been discussed, and I think people will get more of a handle on that.
Take BigPoint as an example - they've come from nowhere, and expecting USD 100 million in revenues next year. A lot of the UK industry doesn't see that, it's much more about the console games - they forget about free-to-play games on portals, or the success of Jagex and Miniclip... they are Great British success stories that are the new businesses coming out of the problems happening within the console market.
Q: We in the media don't seem to reflect those stories quite as well as the more core console stuff?
Ian Livingstone: There's loads of excitement to be had in the UK - it's not all doom and gloom. The fact that traditional development has been in decline for a number of years, and traditional studios have gone out of business... it doesn't mean to say it's all over for games. There are new consumers, and new ways of consuming content on different platforms. Different ways of paying for and playing games.
There's that - they're learning that there's more to it than they think. Also, the networking opportunities here are fantastic, and there's a real sense of belief that there's a great future ahead for the industry.
Q: You've been in the industry for a long time now - what keeps you most excited about working in games, to strive for in the future?
Ian Livingstone: I think it's the ability to reach consumers directly. Games publishers and developers have always laboured to make a game, spent huge amounts of money, and when it's on the shelves it's: "Phew, that's that. Now what?"
Whereas online companies take a different view - getting it to market is just the first stage of engaging with the consumer, and they get a much clearer idea of what consumers actually want.
We rely on focus testing, market research, marketing departments, because we don't really connect - we're more of a B2B business. Whereas these new companies are more B2C, and their knowledge of what the customer actually wants is a lot greater than traditional companies have had in the past.
Connecting directly is something I have an interest in - I used to write my own books, and that's connecting with consumers, and it's nice to get closer to them. You can miss, quite easily otherwise. You think you're making a product for a target group that exists, and they don't... and you can lose a lot of money in a hurry.
So for me, seeing how these companies are doing it is very important.
Q: That service mentality can also be pretty expensive though, and there are still dangers - those users that have the loudest voice in things like forums don't necessarily represent the opinion of the silent majority...
Ian Livingstone: Yes, you're right. There's not really more I can add to that [smiles]
Q: So when we look back on 2009 as a year in business, do you think we'll be looking at the bottom of the curve, the start of an upswing, a further downward trend? From your position at a publisher, what's your sense of what we'll see?
Ian Livingstone: A lot of titles have already hit the shelves and there is a deluge planned for Christmas, but I think 2009 will be remembered as the year of 'roast duck or no dinner'. Big ticket titles continue to sell well but many of the smaller titles will probably disappoint their owners.
There's a glut of product and in a discerning market there is no room for mediocrity. To make a suboptimal game with a suboptimal marketing spend is a recipe for disaster. I think we'll continue to see more production resources going into fewer titles supported by even bigger marketing budgets. Publishers are continuing to raise the investment bar, ensuring the mega-franchises will rule.
As far as UK development is concerned, it's a great shame that studios continue to go out of business. There are a lot of challenges for independent studios that do not have multi-title publishing deals in place or do not have adequate working capital reserves.
One of the downsides for those in a weak position is that they are often obliged to give up their IP. The concern is that the UK is in danger of becoming a work-for-hire nation. Many of the best content creators are now owned by foreign companies which see greater value in what we do than we do ourselves.
It's a classic case of British industry, where we don't realise what we've got until it's gone. The UK is incredible at creating world-beating IP but not particularly good at retaining ownership of it. Access to capital has always been challenging in the UK, especially in the creative industries. Our investors and innovators dont often see eye-to-eye.
As for the foreign companies that acquire our talent and IP, good for them. They see the value and invest accordingly. Take a look at who owns all the major UK-created franchises and play spot the Brit!
As far as Eidos is concerned, it's great for the future of company and the staff in that we have a great partner in Square Enix. Eidos is now a wholly-owned subsidiary of a truly global company, but remains an independent label which is brilliant. The studios and IP portfolio of the combined group is pretty impressive. Going forward, Eidos will continue to generate original IP.
Q: You'll be aware that the first tentatively positive steps towards general tax incentives from the UK government were mentioned in the Digital Britain report, albeit linked to a slightly unclear sense of cultural significance - but does that make you more positive about the future for the country?
Ian Livingstone: Well, I was very pleased to be part of the Games Up? Campaign where we lobbied as an industry, rather than individual bodies. It was ELSPA, Tiga, hardware manufacturers, all the developers, trade bodies, myself, Rick Gibson from Game Investor - we put forward a pretty good campaign and lobbied hard, and it's seems to be bearing fruit.
But there are so many cases of ministers paying lip service and never actually doing anything with it. Over the years we've seen everybody from Stephen Timms, Tessa Jowell, Patricia Hewitt, Shaun Woodward... there's more. Whether it translates into action this time...? I'm hopeful, but you've got to remain sceptical.
Q: It'll be too little, too late for some companies already...
Ian Livingstone: Well, better late than never. You've got to congratulate government if they are in fact going to do something about it - but if they're not, they will pay a price. There's no point in supporting redundant industries if they're going to go out of business. It's a false economy. It's like making candles when the rest of the world is making light bulbs.
We are actually the future - creative industries, the knowledge economy - we are everything that the government actually wants. Creating IP which you can exploit - it's clean, and it matches our inherent creativity, where technology and art come together. We're very good at making games, but let's hope there's still a games industry... because the playing field is not even.
Canada, Europe, parts of Scandinavia, states in the US - they're all offering tax credits, and they have governments that actively support them. Our government has always held us at arm's length because they didn't want to be attached to the negative press that appeared in some of the sensationalist headlines - but others like what we're doing, recognise we're the future, see that manufacturing and financial services are in decline...
Ian Livingstone is the life president of Eidos, and was host at this year's GameHorizon event. Interview by Phil Elliott.