21st Century Breakdown?

Posted on 20/11/2010

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The modern gaming industry has a problem, one that can be summarized by calling it “late stages of capitalist breakdown”. Right now there are about four really big competing publishers left in a business, whose main products become increasingly expensive to produce, increasingly hard to market right and increasingly hard to sell in numbers that might keep shareholders happy.

One of the problems of the gaming market is it’s very nature. Movies are similarly expensive – if not more expensive – to produce as AAA games are these days, but for once “item” prices are lower, and while there are about as many huge movie publishers as there are game publishers, the decision to see movie A over movie B doesn’t bind 8 – 48 hours of the customers free time he’s to spend – most likely – alone at home in front of his TV / computer screen.
This is a massive problem for times like the holiday season, when a huge load of new games compete for the customer’s money. It’s easy enough for a moviegoer to spend an evening watching two films. Even at the theater. It’s not too much time “wasted” and it won’t cost him too much money to do so.

With games however, the situation is very different. Even if the customer actually goes out and buys more than one game per month or per season and NOT just limits himself to the uberhyped StarCrafts and Calls of Duty, chances are low that he’ll buy a – full priced – game he hasn’t heard of on impulse or because his friends tell him that it’s great.
This might be a different story for indi titles and small, cheap downloadables, though those actually worsen the situation for the big expensive games.

It’s all coming down to time and money. A movie ticket – independent movie or blockbuster – can be had from 5 to 15€ over here – the latter only if it’s a 3D one. A full priced game on release day will cost the customer somewhere between 60 and 80€ (in German retail stores, average prices). A movie offers anywhere between one and possibly three hours of entertainment, that’s usually enjoyed together with other people. A full priced game is most likely to be played alone at home. I’d even go the conservative route here and even call online multiplayer an activity that’s enjoyed alone at home. This will bind the customers free time anywhere between, as I said, eight hours and several days during which no other pastime activity and no other game is likely to be consumed. So basically, when a publisher goes and makes a game like Red Dead Redemption, that game might sell like hotcakes, but it’s likely to keep the customer away from other publications – even from the same publisher – if it’s any good.

A game like Minecraft is the worst nightmare of the industry in this situation. An independent title that’s relatively cheap to acquire, reaching a spectacularly massive spread of people and offering basically endless gameplay opportunities, binding customers away from the multi million dollar products on offer.

But what is the way out of this? Making games shorter? Maybe. But there’s still multiplayer. Making multiplayer a paid-for service? Seems some will go to try this. World of Warcraft proves it’s possible. Though it’d be foolish trying to take on this game on it’s own turf. But that is another story. Lowering retail prices? Still not going to increase circulation enough when games still bind people for days on end.
Ultimately the solution to this is somewhere in between. Lowering the production costs – even if that means less ultrashiny games – lowering prices and lowering the game’s length. Short games that are cheap to produce and cheap to buy can be very successful.

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