Issue #142
October 11, 2013
Balance and Ruin
Front Page

Welcome to another issue of Currents, where video game industry headlines are broken down and editorialized. With new consoles and the holiday season on the imminent horizon, autumn is bound to be an interesting time for all of us RPGamers. In fact, most of the stories we'll be covering today touch on the industry changes that we appear to be experiencing. For instance, a few recent news stories have indicated that next generation development will be much more expensive than ever. This has led to some claiming that the home console industry is toppling between balance and ruin — hence today's video:

The Balance and Ruin OverClocked ReMix album should improve anyone's mood. This community crafted LP offers some of my favorite Final Fantasy VI rearrangements, but I'm sure its six hour length will have a little something for everyone.

If I could ask you readers some questions this week, they would be:

  • What fears do you have going into this next console generation?

  • Do you think many developers will fold due to production costs? Which developers?

  • How would you bring balance back to the industry?

In a recent interview with VG247, Guerrilla Games' lead designer on Killzone: Shadow Fall, Eric Boltjes, indicated something a bit startling about next generation development: the production effort needed to make next generation titles hasn't doubled; it's quadrupled. During the interview, he explained that while the PlayStation 4 is easier to create a title for thanks to its developer-friendly architecture, it's also a lot more demanding from a resources point-of-view. Because of more space and power to work with, he believes that everything needs to look that much better. The technological advancements have led to professional demands, including hiring more people, taking more time in the development process, and pushing more communication through each department.

We now live in an age where companies are willing to shell out tens of millions of dollars towards the development of a single game. I think that should be a little worrying. Based on statistics provided by the GDC, game development has ballooned into something pretty nasty (to the tune of $10-40 million). During the 16-bit era, titles generally required between $50K and $300K to complete. As technology pressed onward those development costs increased, however, the costs always made sense next to the profit margin. That profit margin hasn't just shrunk; in some cases it's vanished entirely, leading to mass layoffs and studio closures.

To put the direness of this situation into context, Tomb Raider, Hitman: Absolution and Sleeping Dogs were all considered failures by their publisher. Sleeping Dogs sold an estimated 1.75 million copies to date, followed by Tomb Raider at 3.4 million, and Hitman at 3.6 million. Think about that. A company sells 3.6 million copies of their game and considers it a commercial failure. Likewise, Resident Evil 6 was cited by its publisher as "under-performing" in spite of nearly five million sales. In the same vein, Visceral Games claimed that the Dead Space franchise wouldn't continue if Dead Space 3 hadn't sold more than five million copies. What is happening to our industry?

We've allowed the AAA model to destroy a once sustainable marketplace. Fans are continually looking for the latest and the greatest from their big budget games, causing the cost of development to increase to never before seen heights, and even leading to the death of beloved franchises (and in some cases development studios). Publishers don't want to take risks anymore, and every major release is being geared to "appeal to a broader demographic." If there were more people to buy video games, maybe we could continue down this path. Unfortunately, the market simply isn't growing at the same rate as the increased production costs.

At this year's E3, game designer Cliffy B. tweeted, "At E3 I overheard that a certain AAA new IP needs to sell 10 million break even. No I'm not saying which one. You can guess." To put that into perspective, Halo 4 (Microsoft Games Studios' bestselling game of all time) only managed to move fewer than nine million units. Halo is also a well-established IP with a strong fan base. How a studio could possibly believe that their new IP could move more than ten million copies is beyond me. That being said, if what Eric Boltjes said about next generation development is the same across the board, this "new IP" may be the last IP that developer produces.

The AAA model is broken and will only get worse in the next generation. At this point in time, I believe developers either have to alter the pricing model to adjust for the changing market or scale back development to produce something requiring less resources. We've seen examples of companies adjusting game profits with micro transactions and DLC in the past, with a lukewarm reception at best. It could be argued that gamers are tired of paying more for content that should be on the disk. However, I think games studios like Ubisoft Montreal are on the right path with scaled back titles like Child of Light. There's no question that this JRPG will be of high quality, but I doubt it has as many people working on its development as the next Assassin's Creed would. Maybe small, high-quality downloadable titles are the way of the future. Maybe there is no future for the home console industry. Either way, I wouldn't expect the same AAA model to be around five years from now.

Sources: VG247, GDC

In a recent interview with Infoseek, translated by our friends at Siliconera, Square Enix president Yosuke Matsuda outline the many changes the company must make immediately in order to remain a player in the changing market. During the interview, Matsuda attributed the problems Square Enix now faces to the flawed, but prevalent market business model: the 'price x units sold' model. He says that the company is seeking a model where development and sales can occur more fluidly.

"Past gaming generation changes took roughly three to five years. Nowadays, released titles are updated every day, and it only takes about three months for a situation to completely change. In order to react with such speed, it is urgent for development and sales to be unified as one."

Matsuda, who had pledged to overhaul Square Enix's operations when he took over the reins as president, emphasized the importance of community and player interaction to the modern games business. Content must now be created on a more consistent basis, and should be accompanied by direct interaction with the audience. To that end, the company just announced a program it is calling the Square Enix Collective.

Square Enix is partnering with Indiegogo in order to foster a platform that allows creators to post their ideas to Square Enix's community, garnering votes over the course of 28 days. Project pitches will be evaluated by the company, and providing the community approves the idea, can be taken to Indiegogo to potentially raise funds for future development. Constant communication will take place throughout the game's development process, assisting in distribution once the game is actually available.

The publisher says that while submitting a pitch costs nothing for creators, they will have to accept some terms and conditions in order to submit ideas to the community. This is likely so no one can claim creative copyright on a submitted idea in order to hold development for ransom. Square Enix also added that creators "could have the chance to work with some older Eidos IPs from the company's back catalogue," which has already gotten some buzz with the Square Enix community.

It's good to see some organizational change, or at least awareness, after a decade of handling commercially disappointing releases the same way. The company's past lack of strategic leadership, courage, and communication have been cited by former Eidos Montreal GM Stephan D'Astous and many others in the past. The only way to improve at this point is to change, quickly. Hopefully other publishers will follow suit by better balancing assets and timelines, as well as improving developer flexibility and communication.

Source: Siliconera

Continuing with the theme of breaking the AAA model, father of the Ultima series and longtime industry veteran Richard Garriott detailed at the annual Unite conference how Unity Technologies has been able to replace the broken traditional game development paradigm that has stifled him in the past. It was his contention that the only time ROI on video game development was really worth it for him as a developer was when he was in high school working on his very first video game. Ever since, he's had to contend with cost prohibitive video game engines, skyrocketing budgets, harsh timelines, and almost no room for the development of nuanced game mechanics. After a solid development experience with the community-driven Unity platform, he's become an evangelist on its benefits and believes that it could be the future of non-AAA development.

Unity Technologies was launched in 2005, but it is only now that Garriott believes it to be a disruptive technology for an otherwise stagnant industry. A darling of the indie scene, it is his contention that Unity has generated a workable solution to the high resource cost (time, money, people, etc.) of game development. He cites his latest project, the Kickstarter-funded RPG Shroud of the Avatar, as evidence of the platform's prowess. Within 90 days of choosing Unity as the environment in which to build Shroud of the Avatar, Garriott and his team went from nothing to a rough version of the entire game that any of his team could log into and play. In that first few months, they accomplished what Garriott believes would once have taken, "literally years."

In the past, he has relied on big brand engines like Unreal to deliver the best rendering. This was mostly due to the landscape lacking a decent alternative. However, he now contends that the latest release of Unity represents the number one choice in terms of data entry, art flow, asset access, and community support. The concept of this development utility is pretty novel: the community can help provide the framework, assets, design components, and even feedback, while you (the developer) can focus on content and core components of gameplay. Much of the success of this ecosystem can be linked back to the Asset Store.

The Unity Asset Store has grown from concept to a thriving marketplace selling over 8,000 packages of production tools and assets to more than 400,000 users. The Asset Store's top sellers currently make up to $90,000 every month, with 10 per cent of sellers making more than $1,000. Richard Garriott's Shroud of the Avatar owes quite a bit to the Asset Store's sellers. The rocks, the trees, the grass, the animals, and many other details of the game's world will be modified versions of models and textures purchased from or freely given by Unity's users. In an effort to improve upon that ecosystem, Garriott has promised to make the improved models used in Shroud of the Avatar available to their original creators.

Source: Unity - Unite Con

New to the video game landscape are micro-consoles. Over the course of the past two years, we've seen the crowdfunding and release of the controversial OUYA, its direct competitor the GameStick, the Japan-only (so far) announcement of the PlayStation Vita TV, and now the late-to-market Mad Catz M.O.J.O. As with many other set-top devices, Mad Catz's latest piece of hardware will run the latest Android OS and be aimed at the indie and mobile gamers. That being said, while other companies price their devices around $100, Mad Catz has just announced that the M.O.J.O will be released in "limited quantities this December" for the bitter price of $249.99. The company is now accepting preorders on their official website.

The specifications Mad Catz has listed for M.O.J.O. include: an NVIDIA Tegra 4 T40S 1.8GHz Processor, 2GB RAM, 16GB internal storage, HDMI out capabilities with full 1080p resolution, Bluetooth, microSD Flash Slot with Support for SDXC Cards up to 128GB, Wi-Fi 802.11 a/b/g/n and the Android 4.2.2 operating system. All of this means that it is quite a bit more powerful than an OUYA or GameStick device.

Previously, the company's site also made mention of support for PC-based streaming, however any mention of this functionality has currently been stripped. Perhaps this may have something to do with the failed PC-based streaming that Nvidia attempted to implement in their Android device, Shield. Regardless, the M.O.J.O. will also ship with a host of monitor cables and its C.T.R.L.R. controller (which bears a striking resemblance to the Xbox 360 gamepad).

To be frank, I'm not onboard with this whole micro-console trend, especially if hardware prices are going to climb like this. Does anyone even know if they're profitable? Developers for the OUYA have already cited modest sales, and OUYA is unwilling to disclose exactly how many units they've sold of the device. I have a hard time buying that these devices are anything more than niche. I also have a hard time believing that niche gamers will be willing to shell $250 for an OUYA clone. As much as I can appreciate a company actually taking risks, I'm not sure Mad Catz will have much success this holiday season.

Source: Mad Catz - M.O.J.O

This is a newer section of RPGamer's Currents where we take a hard look at some video game industry rumors and attempt to assess how plausible they are. Nothing in this section has been officially confirmed, but who knows which rumors will float to the surface as fact in the future?

  • Sonic Blue Thunder/Thunderstorm
    There's a rumor circulating that a new, HD Sonic the Hedgehog title will be coming out for PS4, Xbox One, and Wii U under the title of Sonic Blue Thunder or Sonic Thunderstorm. A new hedgehog named "Static" will be featured and younger iterations of the classic Sonic characters from earlier entries will be present. Likelihood? Unlikely. Sonic Team may be good at complicating plots with useless characters and lame mechanics, but Sonic '06's extremely negative reaction would have spurred them away from making most of these design choices.

That's it for this issue of Currents. You'll see another issue again in a couple weeks, but stay tuned to RPGamer for all the latest RPG news, reviews, previews, and interviews.

Your dork from the Great North,

Trent Seely

Stalk me on Twitter: @InstaTrent

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