Disney, Marvel, and a decade of missed opportunity
10 Years Ago This Month: Media giant planned to make super hero games internally, then spent years dismantling its own studios
The games industry moves pretty fast, and there's a tendency for all involved to look constantly to what's next without so much worrying about what came before. That said, even an industry so entrenched in the now can learn from its past. So to refresh our collective memory and perhaps offer some perspective on our field's history, GamesIndustry.biz runs this monthly feature highlighting happenings in gaming from exactly a decade ago.
Dollars and Dalliances
Whenever I hear about a giant from the neighboring tech or media industries getting into video games, I think back to this May 2016 New York Times interview with Gus Wenner of Rolling Stone outfit Wenner Media. He was being interviewed about the publisher's new video game website, Glixel, and he laid out the company's rationale for getting into games.
"Gaming just felt like an area where there was a great audience opportunity, a great revenue opportunity and a major void that we could fill with capabilities we had in-house," Wenner said.
The sentiment makes sense, and some version of it is often brought up in coverage of big-name outsiders throwing their weight around in games. But the reason I keep coming back to this particular interview is Wenner's insistence that Glixel would be a future staple of the company and not a "frivolous one-off that might not exist in two years."
As you may remember (or might have guessed, if you're familiar with why bold declarations usually get revisited in this column), Glixel didn't survive for two years. We can argue about its status as a "frivolous one-off," but Wenner Media laid off the entire staff and shut down its San Francisco headquarters after one year. It then brought in Brian Crecente as a lone editor to oversee Glixel as a freelance-driven publication. However, Penske Media acquired a 51% stake in Wenner Media late in 2017 and retired the Glixel brand in April of 2018, a month and change shy of its two-year anniversary.
I mention this now because two other stories from September of 2009 reminded me of big-name companies giving up on their gaming hopes. The first of those stories was Universal Pictures pulling the plug on its gaming ambitions after the commercial failure of Wanted: Weapons of Fate. The other was Disney acquiring Marvel, which was technically announced August 31, but I didn't really go into this last month and a considerable amount of the coverage ran in September.
It should go without saying that the Disney-Marvel deal has had a sizable impact on the film industry. And while it hasn't exactly reshaped the world of gaming, it didn't take a particularly insightful observer to see the strategic potential of a company with growing aspirations for gaming paired with a stable of world-famous licenses that lent themselves to gaming.
It helped that Disney's gaming division had been steadily building credibility in the industry since 2005 when it acquired Avalanche Software and formed Propaganda Games. It followed that up by acquiring MotoGP studio Climax Racing in 2006, and then Epic Mickey developer Junction Point Studios in 2007. Finally, Disney's purchase of Stubbs the Zombie creator Wideload Games in September of 2009 showed that the company was still building its gaming portfolio at the time of the Marvel pick-up.
Disney wanted to bring Marvel game development in-house rather than continually strike licensing deals with external partners like Sega or Activision
With all that talent and a stable of Marvel licenses in hand, Disney of course saw an opportunity. After the announcement of the Marvel acquisition, Disney CEO Bob Iger acknowledged to investors that the company wanted to bring Marvel game development in-house rather than continually strike licensing deals with external partners like Sega or Activision.
"When you have companies entering into third-party relationships for licensing they can often be quite attractive, and they continue to be," Iger said. "But when you operate as one company and you vertically integrate, you remove from the equation a lot of friction, and when you're both aligned in terms of creating value that can often be really compelling. That's exactly what we found with Pixar.
"There were some licensing agreements that were attractive but there's nothing better than being one. And that's what we look forward to here."
It was a great plan, but as Marvel movie fans can attest to, the comic company had some pre-existing licensing deals that weren't designed with an eventual sale to Disney in mind. For examples from the world of games, Marvel had signed an exclusive deal with Sega for the first wave of Marvel Cinematic Universe movies, the last game of which was Captain America: Super Soldier in July of 2011. And years before Disney acquired Marvel, Activision in 2005 had already extended its deal for Spider-Man and X-Men games all the way through 2017. (Activision's last original X-Men-related title was 2013's Deadpool, while the Spider-Man games stopped with 2014's adaptation of the Andrew Garfield film The Amazing Spider-Man 2.)
The vertical integration of Marvel's heaviest hitters and Disney's internal studios never really came together in the way Iger intended. Indeed, Disney's interest in gaming seemed to wane before it ever had the chance to bring its biggest offerings in-house.
In October of 2010, the company killed a Pirates of the Caribbean game at Propaganda and laid off 100 people. The remaining staff finished up work on Tron: Evolution before the entire studio was shuttered three months later. A week after Propaganda got the ax, there was a larger round of cuts across Disney development, with half of Junction Point given walking papers. The rest of the year would see further layoffs at a division level, a wave of cuts at Black Rock (formerly Climax Racing), and up to 20 more given the boot at Avalanche.
One might have thought there would be renewed interest in gaming at Disney with the 2012 acquisition of Lucasfilm and its storied LucasArts gaming division, but one would have been mistaken. Disney signalled its intention to license out console Star Wars titles on day one, and signed exclusive rights over to Electronic Arts less than a year later. While 2013 did see the release of Disney Infinity -- arguably the company's greatest accomplishment in the world of video games -- that was preceded by the closures of both Junction Point and LucasArts. In March of 2014, Disney Interactive laid off 700 people (closing Wideload in the process), and two years later, it shut down Avalanche and announced its withdrawal from self-publishing console games entirely. (Avalanche would later be picked up by WB Games.)
External players can invest in gaming as a potential growth area, but as soon as they lose faith in that potential, there's no need for them to tough it out
These external players can invest in gaming as a potential growth area, but as soon as they lose faith in that potential -- once they run into unanticipated difficulties or the buzz around a particular Next Big Thing dies down -- there's no need for them to tough it out. Gaming is not their core business. They are not invading forces who burned their boats behind them; they are tycoons playing dice with an amount of money they are entirely willing and able to lose. Sometimes, as with Microsoft and Sony inserting themselves into the console hardware market, the bets pay off handsomely. Other times, they don't. And sometimes the failure might just be a temporary setback, an Apple Pippin to precede the App Store.
The point is, these huge companies with vast resources are fickle, and they tend to have those vast resources because they're not willing to risk the entire business on an expansion plan that doesn't seem to be working. So while Google launching a game streaming service and Amazon forming studios and creating its own development engine could be the first steps to something much bigger, they could just as easily be the next Google+, the next Amazon Spark, or the next vertically integrated, Marvel-powered Disney Interactive Studios juggernaut.
The Sega Dreamcast's Legacy
The Sega Dreamcast debuted in the US on 9/9/99, so this month marks the 20th anniversary. But since this column isn't 20 Years Ago This Month, I feel obligated to instead reflect on the 10th anniversary of the system's 10th anniversary.
Then-EA exec Peter Moore was similarly moved to reminisce about the hardware, seeing as how he helped launch it during his stint with Sega of America. Of particular note for Moore was the system's built-in modem, a first for the console business.
"I don't think it is an overstatement to say that the Dreamcast and its online network laid the ground for what we all take for granted today - online gameplay, linking innumerable gamers from around the world to play, compete and collaborate, as well as enabling new content to be delivered in addition to that which was delivered on the disc," Moore said.
Regardless of whether or not we should give the Dreamcast credit for something that was already old hat for PC gamers, Moore's comments go some way toward explaining why the Dreamcast is unquestionably my favorite system of all time. It was a bridge between eras, with games that worked online but were still typically made with offline single-player as a major part of the package. It was powerful enough to render 3D visuals that hold up today, but old enough that a fair number of Dreamcast publishers were still churning out high-quality 2D games. It had (admittedly minimal) DLC for some games, but developers couldn't rely on connectivity to mandate day-one launch patches.
For someone like me who dislikes a lot of the games-as-a-service era trends in the industry, the Dreamcast represents the blissful point just before everything started to change and the no-good kids these days started messing up my lawn.
In brief…
● Kurt Cobain's widow and former bandmates were upset to find Activision had made the Nirvana frontman a playable character in Guitar Hero 5, which naturally led to covers of questionable taste. It seems that wealthy and famous musicians either have terrible lawyers, or Activision didn't go out of its way to explain what it wanted to do with artists' likenesses, as Maroon 5 frontman Adam Levine and No Doubt also took exception to having their avatars playing other people's songs in Band Hero.
● Meanwhile, Bobby Kotick was talking about Activision's huge opportunity to bypass consoles with presumably plug-and-play versions of games like Guitar Hero (nope), how cash prizes will expand the audience (arguably yes thanks to esports), and how the business is transforming to one where people spend $500 on a game over its lifespan rather than $50 (big yup).
● A Sony UK representative said retailers were "really quite fine" with the digital distribution-only PSPgo, but I can't tell if that's because "really quite fine with it" is British for "absolutely #$%^$*# livid over it," or if it's just not worth getting upset over a digital-only revision of four-year-old hardware that wouldn't play a good chunk of the system's library and came out before most people were comfortable buying games digitally in the first place.
● Finally, in September of 2009, almost three full years after it was launched, the Wii received its first price cut. By the same point of the Wii U's lifecycle, Nintendo had already given up and announced its successor, the Switch (code-named "NX" at the time).