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Capcom On Digital Distribution, PC Ubiquity

New PCGA-member Capcom think digital distribution is the future, and their support of PC gaming is tied up with that belief. One of the people behind that support is Christian Svensson, vice president of strategic planning at Capcom. Svensson talked to us about the importance of the PC for this traditionally console-focused publisher, the problems of developing for PC, and whether digital distribution is more important for the PC than retail.

RPS: Hi Christian, can we start by talking about Capcom’s increased interest in the PC, and perhaps a little about the attitude of your company towards the PC as a platform?

Svensson: Sure, well, I think it’s fair to say that for PC audiences, when you think of the PC platform, then Capcom probably isn’t a publisher that comes to mind right away. But there are two initiatives going on, one in Japan, and one in the West.

People might remember Devil May Cry 3, Resident Evil 4, and Onimusha – these were projects that were outsourced, and run by our licensing team, rather than internal R&D. They were thrown over the wall to a developer, and the ports were quick and dirty, and even internally were not viewed favourably. As part of the licensing deal Ubisoft had the rights to distribute. Shortly thereafter the US side of our business decided to bring that back into the consumer software side and grow it. At the same time there were two things happening in Japan: number one was the development of the MT framework, the technology which would allow us to port over work we’d done on PS3 and 360 to the PC. The second thing was a broad online initiative towards Japan, Korea, and China, headed up out of the Tokyo office. The first title that has shipped is Monster Hunter Frontier, which is now one of the most successful MMOs in Japan.

So that’s how we got to where we are with bringing titles to internal development on PC. Lost Planet was the first game to ship with DX10, and it had some of the code that became Steamworks in it. They had to peel out some of the code that we worked on for that game, to make what you see today on that platform. So we were forward thinking with all that kind of functionality. Since then we’ve released Devil May Cry 4 and Lost Planet Colonies. And MotoGP ’08, NeoPets, Flock, Dark Void have all come, or are coming out, from the West. We also have Streetfighter 4 coming out from Japan on the near horizon, and Dead Rising 2 a bit further out. There’s more too, but we’ve not announced that yet.

RPS: But what actually sparked that change? When large publishers are grumbling about PC and pushing it away, why make that transition so actively?

Svensson: Taking a very global view. We have brands that are very appealing, but the platform of choice in many countries is not a current-gen console. I’ll point to Russia, to Brazil, to emerging markets in the Middle East. India is an emerging market, even if it is a few years away from doing the kinds of things that we need. The PC is global, and it’s ubiquitous. And quite frankly, the more people who shy away from that platform, the bigger the opportunity. It’s not easy, however. The PC has a lot of moving parts, there’s a lot more testing to be done, there’s a lot of considerations about how to even get to market. You need broad understanding. We know it’ll take a few years of development and investment before we’re where we want to be.

RPS: Is digital distribution more important to the PC than retail?

Svensson: For me? Absolutely. No question in my mind. Digital distribution on PC ties directly into our strategy. Capcom is trying to lead in digital distribution, and I would go as far as to say that in the console space we are already the leading software publisher. We’ve had the highest revenue-generating Xbox Live title, we’ve had the highest revenue-generating Wii title, we’re definitely in the top three or four on the PlayStation network. To that end, on the PC side, I’ve spent the past year building up a digital distribution channel that has about twenty different partners. We’re ready on the console side, and we were the first Japanese publisher to do anything on Steam.

RPS: And would you say that increased digital sales presence is more important than increased PC presence at retail?

Svensson: In the current market, I would. We will probably do as much digital selling as retail in the current climate.

RPS: You’re a high-profile new member of the PCGA, who we’ve talked to recently, but what are you getting out of it?

Svensson: Look at the mission of the PCGA. It’s to improve the PC gaming ecosystem. How do we go about doing that? One of the problems, to be candid, is that retail is falling away. What are the reasons for that? Partly it’s that return rates are very high. Returns of a PC title are usually double that of a console title – why? Because it’s not a great consumer experience because there’s variation in minimum spec, and it requires a lot of consumer knowledge to figure out exactly what is in their box, and what that will run. If we can improve that, if we can improve issues with DRM and create an anti-piracy policy that is friendly to consumers, that will remove barriers to sales, and improve the ecosystem. Being completely mercenary: all this will improve our bottom line. The more successful we are on a platform, the bigger the risks we can take, and the better content we can produce there. Our membership of the PCGA is about improving the market: we want to improve the experience for consumers. More selfishly, if there are going to be “best practices” suggested that become standards, we want to make sure our interests are looked out for.

RPS: Piracy is the other big issue for the PCGA, isn’t it? I see they’re working up a report on that.

Svensson: It is a big issue on PC, and it’s probably not going to go away. The PCGA is putting some of the best minds in the industry to work on that, and I hope it’ll be able to make some useful recommendations. We would like to improve the situation, because it would improve our bottom line. But we do really need to examine the situation carefully, and perhaps even look at whether some elements of piracy can be harnessed for good. As a distribution network it is useful, and perhaps that can help us distributed software trials and so on. There are aspects of piracy that, if they can be turned around, can become positive.

RPS: I guess we’ll have to see just what the PCGA report recommends in that regard. Christian, thanks for talking to us.

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