Solving The Game Equation

It should be apparent to most observers of the games business, that the “Triple-A” end of the business is in quite a bit of trouble these days.

In my home country of Denmark alone, the biggest of the studios (Io Interactive, makers of Hitman, my old job) has laid off about 60 people in 2010 alone – a substantial percentage of their workforce.
The second Triple-A studio, Deadline (Watchmen), went bankrupt in 2009. I don’t know of any other danish studios that aspire to be the Triple-A variety, but across the globe, core gaming studios are are laying off staff – LucasArts, EA, etc.
All of them are giving us the usual song and a dance about how it’s normal and follows their release schedules, but in the cases where I have insider information, it’s not at all normal.

It’s gotten so bad, that it’s a rare thing to hear a success-story about Triple-A these days.

When you do hear a success-story, it’s usually something like “Call of Duty: Black Ops” – the ten thousandth game from a popular franchise that has a marketing budget resembling the GDP of a small nation, and who are even showering reviewers with gifts to hopefully push that all-important metacritic rating a few points up.
Activision are blowing their entire wad on marketing Black Ops, because it was probably judged (or tested) to be the game that had the highest chance of succeeding at mass market success. Meanwhile, back at the ranch, they are closing Bizarre Creations and probably hurting a lot of other of their studios by so myopically putting all their eggs in the Black Ops basket.
While Black Ops is most likely a fine game (albeit flawed, it seems), it’s has practically bought it’s success (if indeed it’s success is even commensurate with it’s marketing budget).

So what is going on? Why is the Triple-A business struggling?

Continue reading →

After spending some time playing and analyzing FarmVille, which resulted in an article and a talk at SpilBar in Copenhagen, I’ve gained a better understanding of this business model.

I’ve also realized that though most of the games that employ free-to-play (F2P) as their hook tend to lean towards grind-heavy RPGs or farming games, there’s really nothing in the model that fundamentally requires this to make money.

Here are the key points in F2P, that I find extremely powerful:

1. You lower the players reticence (and investment) to play your game by making it freely available
2. You delay the purchase decision until the player is invested in the game
3. You make it possible (and in some cases necessary) to spend more on the game, than just outright purchasing it.
4. You make it possible to collect small amounts of money from people who like your game a little bit, and lots of money from people who really like it.

Point 1 is like a product demo, but more appealing since the game is really free, unless you opt into paying. That’s possibly very generous, and possibly just a fake gimmick like that free hit on a crack-pipe the nice gentleman on the corner offers you.

Point 2 is like giving out a product demo and asking people for money when they’ve had a good taste, but better – since they can keep playing and keep delaying the spending decision until they are happy with it. It gives the developer a much larger window to sell something to the player, and it gives the player a much better opportunity to get to know the game before they decide to part with their coin.

Point 3 is great for those super-fans who would have bought the extended gold super platinum extra spiffy jelly filled unrated ultra edition box set of your game if it was a movie (and listened to the commentary track). They get to shower you with love and cash, if they are so inclined. And you get to cater to people who really appreciate your work as a developer, which is fun.

Finally, point 4 is great because a lot of people might not be inclined to give you $50 for a your game (especially before trying it), but they might be having a bit of fun and be willing to spend a dollar. And a lot of players spending a single buck is still a lot of bucks.
The buy-in price and your pay-out happens on a sliding scale from “hmm, yeah, ok, I guess” to “TAKE MY GOLD, DEVELOPER-GODS!”, which is beneficial for both player and developer.

I’m not at all blind to the fact that every one of these points could be laid out in a much more sinister and douchy way. All these points can be used in less than savory ways, which is what FarmVille does – but it’s possible to use these powers for good, if you fight your inner greedy douchebag and actually try to think like I’m descibing it here.

So, I’ve come around – I think this is a powerful business model, which can actually be used in a very wide variety of games. It makes it easier for players to try your game, and easier for developers to convince people that it’s a fun game worth paying money for.