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Financial Issues May Force Changes On Games Industry 246

Posted by Soulskill
from the go-go-gadget-indies dept.
krou writes "According to comments made at the Edinburgh Interactive conference, operating costs of making games are spiraling upwards, and there has been 'significant disruption' to the games industry's business model. Games are getting much bigger and taking longer to develop, the console market is fragmented, and the cost of licensing intellectual property has gone up. All of this, says Edward Williams from BMO Capital Markets, means that 'For Western publishers, profitability hasn't grown at all in the past few years and that's before we take 2009 into account.' Recent figures suggest game sales have fallen 29% over the last 12 months. While westerners still relied on putting games on DVDs and selling them through retail channels, 'Chinese developers focused primarily on the PC market and used direct download, rather than retail stores, to get games to consumers,' and the lack of console users 'meant developers there did not have to pay royalties to console makers.' Peter Moore of EA Sports said that significant changes will come in the future, particularly in electronic purchasing of games."
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Financial Issues May Force Changes On Games Industry

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  • Re:Good thing, too (Score:5, Informative)

    by MBGMorden (803437) on Sunday August 16, 2009 @04:49AM (#29081771)

    While licensing big properties like that is part of the equation, later comments in the summary lead me to believe that a big part of "Licensing IP" that they reference is simply the fees you pay to publish on a console. If you put out a PS3 game, Sony gets a cut. If you put out a Wii game, Nintendo gets a cut. If you put out a computer game though (be it Windows, Linux, Mac, whatever), you generally don't have to pay royalties to any company just to publish your game.

  • Re:ARRRGH (Score:4, Informative)

    by Mystery00 (1100379) on Sunday August 16, 2009 @05:33AM (#29081881)
  • Re:overhead bloat (Score:5, Informative)

    by julesh (229690) on Sunday August 16, 2009 @07:32AM (#29082237)

    Somewhat off topic but think about this. How can District 9 which is such a great movie with some of the best unique effects Ive seen in a recent Sci Fi movie cost 30 Million and yet Transformers 2 cost $228 million, GI Joe Movie $170 million etc. All icing and no cake.

    It's called Hollywood accounting [wikipedia.org]. The quoted cost of producing a film that's expected to do well typically actually includes costs of earlier films that didn't do so well when they were released. By doing this, they reduce royalty payouts on the successful movie (as Hollywood typically pays royalties to writers, IP holders, etc. as a percentage of profit rather than percentage of net takings as most other IP-related industries do).

  • by tepples (727027) <tepples&gmail,com> on Sunday August 16, 2009 @08:46AM (#29082581) Homepage Journal

    Then stop relying on licensed IPs and start making compelling games that people want to play.

    What would Guitar Hero have been without songs that people recognize?

  • by mathx314 (1365325) on Sunday August 16, 2009 @09:00AM (#29082659)
    Sins of a Solar Empire wasn't a small indie game, it was made by Stardock, an already established studio and released for full retail price. For a better indie game, consider World of Goo: two coders, $10,000 development (including food and rent), sold over $450,000 on WiiWare alone.
  • by tepples (727027) <tepples&gmail,com> on Sunday August 16, 2009 @09:00AM (#29082661) Homepage Journal

    With a cap that low [25 GB per month] you're a rarity in the market

    In areas of the United States not serviced by cable or DSL, the cap is even lower. MiFi service from Verizon and Sprint, which runs over their 3G networks, has a cap of 5 GB per month. Satellite Internet from companies like WildBlue typically has a cap below 10 GB per month as well.

  • by tepples (727027) <tepples&gmail,com> on Sunday August 16, 2009 @09:09AM (#29082703) Homepage Journal

    I am soon 30 and have a job, I love small and fun games that I can play for a few hours or so

    Then you might like Animal Crossing series.

    without having anxiety for not being able to play for a week.

    Oh wait, scratch that recommendation. For each day you don't play an AC game, weeds get added to your town, and you might miss a holiday event.

  • by nschubach (922175) on Sunday August 16, 2009 @10:33AM (#29083183) Journal

    Canceled... like it should have been a long time ago. ;)

  • by Haeleth (414428) on Sunday August 16, 2009 @05:54PM (#29086491) Journal

    Those genres are already very popular. This has not killed PC gaming. Therefore, your claim that popularising them will kill PC gaming is transparently false.

    The single-screen multiplayer case is not even something the PC "can't handle". The PC handled it very nicely when it last made sense, which was with split-screen games about 15 years ago. Then the internet made split screen look very silly. It's only very recently that the growth in popularity of party games has given shared-screen multiplayer a new purpose.

  • by MBGMorden (803437) on Sunday August 16, 2009 @10:38PM (#29087963)

    Actually depending on how you play your cards you might actually get a monitor for that $300. My last laptop was right at $300 and it naturally included a monitor. I've also seen sales (particularly Black Friday sales) with Desktops with monitor for $300 or less.

    You missed my point though - as I said, many families already have a separate computer for each user OUTSIDE of gaming. The cost statement is merely to prove the feasibility of that. You don't need to compare it to a Playstation because most people (and increasingly so in the future) will have a computer for everyone regardless.

    Not to mention that fact that with the rise of Xbox Live and other online services, split screen even on the console is pretty much dieing. Being a known "computer guy" has led to me getting talked into setting up more than a few home networks in my area. I've not only seen the multiple computers thing going on, but it's also fairly common to see each kid with their own Xbox360 connected to the network for online play too. If the kids want to play together then the online services facilitate that.

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