Is There Any Game Publishers / Developers "Too Big To Fail"?

[soldant]

Zero. In fact the gaming industry would be better off in the long term if ALL the big publishers crashed and burned. The industry is complete shit presently.

Yes, because publishers are responsible for every single shitty game...

The draconian publishers need a significant shakeup and the balance of power should be adjusted, but if the fundamental game concept is shit, then it's going to be a shit game regardless. The first wave of Kickstarters is yet to appear in force in their finished form. It's still too early to imply that Kickstarter or indies will be the saviour of the industry, a lot of those projects could turn out to be rubbish for all we know. If history tells us anything it's that most games aren't classics, we only remember the good stuff and forget the bad or mediocre (unless it's a kind of legendary failure, like Diakatana).

[Hypernetic]

Yes, because publishers are responsible for every single shitty game...

The draconian publishers need a significant shakeup and the balance of power should be adjusted, but if the fundamental game concept is shit, then it's going to be a shit game regardless. The first wave of Kickstarters is yet to appear in force in their finished form. It's still too early to imply that Kickstarter or indies will be the saviour of the industry, a lot of those projects could turn out to be rubbish for all we know. If history tells us anything it's that most games aren't classics, we only remember the good stuff and forget the bad or mediocre (unless it's a kind of legendary failure, like Diakatana).

I'm not really sure what this has to do with what I said. I wasn't implying that indie games are going to save the day or anything, but an indie company going under isn't going to change anything. However, if Activision/EA/Ubisoft all imploded there would be significant change.

[soldant]

I'm not really sure what this has to do with what I said. I wasn't implying that indie games are going to save the day or anything, but an indie company going under isn't going to change anything. However, if Activision/EA/Ubisoft all imploded there would be significant change.

Well, you said that we'd be better off if all the big publishers crashed and burned, and given that Kickstarter isn't pulling in the multi million dollar budgets to fund full AAA titles, I guessed you were referring mostly to the indies.

[Hypernetic]

Well, you said that we'd be better off if all the big publishers crashed and burned, and given that Kickstarter isn't pulling in the multi million dollar budgets to fund full AAA titles, I guessed you were referring mostly to the indies.

Nah, my line of thinking was more along the lines of the video game crash in the 80's where something new and great would rise from the ashes similar to how Nintendo became a household name after said crash.

[Caddybear]

What do you mean publishers? I only play Dwarf Fortress.*


*not actually true

[archonsod]

Nah, my line of thinking was more along the lines of the video game crash in the 80's where something new and great would rise from the ashes similar to how Nintendo became a household name after said crash.

Only in the US, and the thing about the crash in the 80s was that it made home computing viable - prior to that the main gaming market was the arcades. If it happened now, I have a sneaking suspicion we'd see mainstream gaming move from the home to the mobile phone.

[Sparkasaurusmex]

I don't see why a mobile phone isn't a PC. It's just tiny. Too bad HDMI out isn't a standard thing, or even some kind of mini-DVI.

[Hypernetic]

Only in the US, and the thing about the crash in the 80s was that it made home computing viable - prior to that the main gaming market was the arcades. If it happened now, I have a sneaking suspicion we'd see mainstream gaming move from the home to the mobile phone.

"Only" the US.
Also you don't really have your facts straight. Home gaming systems were already widespread by then, the crash happened in what is considered the second generation of home gaming systems.

http://en.wikipedia.org/wiki/North_A..._crash_of_1983

[Kadayi]

Nah, my line of thinking was more along the lines of the video game crash in the 80's where something new and great would rise from the ashes similar to how Nintendo became a household name after said crash.

Where's the money Lebowski?

The entire economics of game development have radically transformed since the 80s in terms of overheads, as well as player expectation. This idea that if all the big publishers went to the wall some enterprising white knights would ride to the rescue is farcical. The outside money simply isn't there, and the few examples there are of where private investors have stepped in (APB & KoA) have generally gone badly (because Devs don't necessarily know how to run businesses it turns out). If anything your outside money is even more likely to also go for safe bet games as well (or at least what they perceive as safe) because they're looking for a strong return at the end of the day.

As for Kickstarter...perfect for certain types of vehicles, but it's not remotely viable for full on AAA development. Look at Project eternity overall 80K people backed it (including me) and they got $4 million which works out as around $50 each. Most modest AAA games are in the $20 - 30 million range, so you're looking for a good quarter of a million backers if you want to keep below $60, and that's not even dipping into the cost of incentives and marketing.

Plain truth if the matter is the biggest investors in game development are the big publishers at the end of the day. Sure they payout dividends to shareholders, but as they're all essentially competing with each other as well as any other form of media for your entertainment dollars in an world where there's increasingly more to distract you than ever before in terms of choice, they have to keep up with the Jones if they want to stay in business, and that means ploughing the bulk of their profits into new games. I'd love it if every game was some shiny new innovative thing, but any new venture is a gamble for these companies at the end of the day and they can't bet the farm on every roll of the dice because statistically it's extremely risky.

[squirrel]

Electronic Arts is quite a unique USA business model which you cant find easily in the rest of the world. While actually create very few on their own, they goes out (they are still doing it, so I think I get the tense right) to purchase other studios and their IPs.

The infamous, yet largest automaker in the world, General Motors, as I know, was also built over a century ago under the similar business model. It was a guy named Durant something who, used to make horse carriage, realized that horseless vehicle would be the future of transportation. Without engineering knowledge himself, he went out to buy number of automakers to place them under the umbrella of GM. Strictly speaking, Mr. Durant established almost no automaker himself, except Chevrolet I think.

I dont really like those conglomerates built that way. They by nature seek to monopolize everything in the industries they are in. They are aggressive and in many cases, I regret to say this but I must say, that they generally dont do business honestly. GM manufactured some of Chevrolet and Buick cars here, but those are damn outdated models. Screw them. They invest here, they are obliged to transfer some of up-to-date technology to us, not to make some outdated, unreliable, polluting and fuel-inefficient vehicles to be sold locally. Western game houses are doing the same here. Yes they maintain studios here, but all their workshops here are doing grunt works. Friends who worked for UBI, EA,... all complained that they learnt nothing there. Those firms intentionally withheld updated know-how from them.

I wonder if this is the primary reason western publishers cannot generate good franchise with great value to carry on. You can buy up a franchise, but you may not understand the franchise well enough to bring it on. EA, give me back Command and Conquest!!

What you think would happen to the game industry if EA's proposed acquisitions of Epic and Valve were accomplished?

Seriously, fall of Midway and THQ doesn't seem to be that a great loss to me. They had built some once great franchises like Mortal Kombat and Company of Heroes, but they just couldn't extend their longevity.

BTW, if you have EA games requiring EA's servers to run, dont worry about the demise of this franchise terminator (which is very unlikely though). There will always to enthusiasts taking care of the problem for us. Say, cracked servers for Bad Company 2 have been available. Games released are no longer owned by the publishers, they are owned by the whole gaming community.

[iridescence]

Sure, the Total War series is awesome, but it's not like that would disappear if Sega vanished. Paradox, on the other hand, is a developer/publisher that makes games I love, most of which would probably go down with the ship.

This is how I feel too. Major franchises are always going to get picked up but if Paradox or the guy who makes Dwarf Fortress stops working it's doubtful anyone else would pick up those games so it's a pretty big loss.

[soldant]

Electronic Arts is quite a unique USA business model which you cant find easily in the rest of the world. While actually create very few on their own, they goes out (they are still doing it, so I think I get the tense right) to purchase other studios and their IPs.

That's not that unique. In fact a lot of Valve's more recent games were made that way with the addition of a few Valve trappings. Counter Strike and TF2 both started out as mods. Portal and Portal 2 come from Narbacular Drop and the team that developed it. L4D was originally a Turtle Rock Studios game until Valve acquired it in 2008 (though Valve already had TRS under its wing anyway). Valve's only real 'original' property (i.e. not based on something they purchased) has been the Half Life games and Portal's storyline.

The difference between EA and Valve is that Valve just absorbs people into their organisation, while EA keeps the studios and turns them into factories and answers to shareholders. Valve are a power unto themselves and answer to nobody (except probably GabeN) and give their staff more freedom to move. Then again Valve can get away without releasing games and taking as much time as they need thanks to Steam.

[Lordcrazy]

I feel that some publishers are somewhat necessary to push some games out that otherwise wouldn't be possible, but the majority of the large ones, ie Activision-Blizzard and EA are pushing the same junk out year after year (with some exceptions) and should probably go keel over and let some IPs to go into the hands of smaller developers to let them have a try at revitalizing them.

[archonsod]

"Only" the US.
Also you don't really have your facts straight. Home gaming systems were already widespread by then, the crash happened in what is considered the second generation of home gaming systems.

Erm, WTF does the availability of systems have to do with anything? The money was in arcades, not the home systems. Spot the similarity today where more people own mobile devices than a gaming system, yet the money is in the home systems.

[b0rsuk]

Kadayi:

1) AAA projects were around $10 million in mid 90's. Many gamers don't consider this period disastrous for PC gaming. Kickstarter is getting there. Of course, if "AAA game" means "AAA graphics" for you, then you might never be satisfied with kickstarter games.

2) So far, money spent on kickstarter games is growing exponentially. 50 million in 2012 alone is no laughing matter.


---------------------------

Speaking of Steam, its competitors might never reach critical mass. Based on my observations, global networks (and Steam is such a network, not just DRM) tend to eat each other. Myspace was a big thing, but there was no room for both Myspace and Facebook. The internet is not the only world-wide network, but people prefer to join it rather than isolate themselves and try to support an alternative. The root of the problem is, in my opinion, the lack of cooperation. There are laws to force telecoms, in particulacular cell phone carriers, cooperate with each other. You and your friend don't have to be in the same network. Now try that with with Myspace and Facebook. Pandora, Spotify, Last.fm. You can't easily export your data and go elsewhere. That's why it encourages people to heavily invest into one social network and stick to it. Steam might be replaced one day, but it won't co-exist with something else. One network will always have a lion's share of users in its category.

[Avish]

Kadayi:

1) AAA projects were around $10 million in mid 90's. Many gamers don't consider this period disastrous for PC gaming. Kickstarter is getting there. Of course, if "AAA game" means "AAA graphics" for you, then you might never be satisfied with kickstarter games.

2) So far, money spent on kickstarter games is growing exponentially. 50 million in 2012 alone is no laughing matter.

1. In the 80's development cost was less than a million. Pacman and space invaders were AAA popular games, so let's remake them... The market changed in those 20 years and the average customer demands more than low res graphics, 2D models and live action cut scenes (with some of the worst acting seen anywhere).

2. Kickstater gained popularity in 2012, so of course you'll see a big rise in money pledged. This graph might be relevant by 2015 and even than you'll need to look at the average per game and not at the total pledged.

[Anthile]

Also, adjusting for inflation, those $10m are roughly $15m in modern money.

[soldant]

1) AAA projects were around $10 million in mid 90's. Many gamers don't consider this period disastrous for PC gaming. Kickstarter is getting there. Of course, if "AAA game" means "AAA graphics" for you, then you might never be satisfied with kickstarter games.

Standards for the AAA games were much lower in the 90s, especially with the rapid pace of technology where a lot of the popular games were part gameplay and part technological innovation. Games like Doom and Quake are fun games, but a big part of the appeal was in their tech; Doom's sector engine was amazing for its time, and Quake was another leap again for the days of DOS and software rendering. That's not to say that massive budgets breed the best games, but indies working with small budgets can only ever achieve so much. There's going to be no fully voiced Planescape: Torment magnum opus from an indie on a $1mil budget with 60 hours of gameplay etc. There's going too be no Skyrim on a $1mil budget for that matter either. Procedural generation isn't good enough (and maybe won't be for a long time) to fill in the gaps.

2) So far, money spent on kickstarter games is growing exponentially. 50 million in 2012 alone is no laughing matter.

True! But Kickstarter is new and optimism is high, with the majority of the bigger projects still quite a while off release. As Avish said, a lot can change in a few years and Kickstarter funding may decline, particularly if some of the bigger projects fail to deliver and as backers become more cautious. I think backer fatigue may also set in eventually - taking a look at the HiB the average price fluctuates quite a bit, as do the total purchases, and from reading comments on places like RPS people are getting tired of the constant bundling. Kickstarter may go through a similar phase where there's just too much and it becomes too expensive to back projects based only on a page of advertising. Kickstarter is popular because it's relatively new and people are still optimistic.

Speaking of Steam, its competitors might never reach critical mass.

Of course they won't, but it might have less to do with cooperation and more to do with how fanatically attached people are to Steam. It's amazing that the most loved platform hailed with cries of "No Steam, no sale!" was originally hated back in 2003 when people bitched about Valve trying to scoop up more money and forcing us onto Steam and shutting down WON etc. EA starts up their own store (for the same reasons that Valve started Steam) and gets shouted down for it.

The problem is that Steam is excellent (most of the time, the client is still a piece of shit in some places but nevermind that) and Valve has built such a significant amount of goodwill with the community that they can get away with screwups that would result in crucifixion of other companies if they'd done the same thing. Case in point - people bitched that EA might ban or suspend people for chargebacks, but this policy is also true of Valve regarding Steam... something that everybody seemed to forget. For a competitor to beat Steam it'd need to be better than Steam... which is entirely impossible because Steam itself doesn't do anything special. It's just the first to find popular acceptance and is the largest. You can't do better than Steam because it's just a store with occasional sales. I don't know how to improve on that except to sell everything at a loss.

[Hypernetic]

Erm, WTF does the availability of systems have to do with anything? The money was in arcades, not the home systems. Spot the similarity today where more people own mobile devices than a gaming system, yet the money is in the home systems.

Did you even read what I wrote? Also the arcades didn't "crash" during this period, it wasn't until probably a decade later that arcades started disappearing. The crash was related to the market being flooded with shit home console games and people refusing to buy said shit games because they were shit (sound familiar?).

[Shooop]

That term only applies to banks as far as I know because those institutions hold so much of the public's money them failing would mean the public looses the money they trusted them to hold.

Game studios aren't being trusted to hold your savings or provide anyone with necessities, so I can't see how any one of them could be considered too big to fail.

If they do fail, the same thing happens to them as what happened to THQ - their licenses are auctioned off to others.