Archive for August, 2009

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Nielsen reports record gaming for June 2009

Tuesday, August 11th, 2009

According to a new report published by Nielsen Co., this past June was a banner month in video game play. While sales of consoles might have been flat, it appears that those that already own a console (or two) spent record amounts of time (measured in minutes) gaming. According to a recent NPD Group survey June ’09 hardware sales took a beating, dropping 31 percent when compared to June ’08.

Compared to June 2008, Nielsen’s year-over-year numbers indicate a 21 percent increase in time spent with games. On average, gamers spent 12.8 hours playing during the month of June.

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Of particular interest, the Nielsen survey clearly indicates that consumers have reached the crucial critical mass numbers with ‘new generation’ consoles, the Xbox 360, PS3, and Wii, as half the minutes played during the month of June were dedicated solely to these consoles. Nielsen’s director of video game services, Geraldo Guzman comments, “The transition has happened. Now that there is critical mass on the new generation of consoles, it gives marketers a chance to reach gamers on the platforms which offer in-game advertising.” An interesting point, as currently only the Xbox 360 and PS3 support dynamically served in-game advertising. However, let’s not forget about the recent WipEoutHD iga fiasco.

The Nielsen study also indicates that more than 50 percent of all gamers are over the age of 18 (insert marketing opportunity here), with teens 12 – 17 making up the largest segment of minutes played players, a massive 25 percent.

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Casual games maker Oberon Media dives headfirst into the microtransaction end of the pool

Monday, August 10th, 2009

Late last week major casual games maker Oberon Media announced that they’ve made a big move, signaling “only the beginning” of a greater strategy of getting involved in the world of free-to-play/microtransaction supported titles.

logo_oberonBased in New York, Oberon Media develops and publishes games for casual web and most game platforms. Signaling a major shift in the way the company seeks to monetize their products, Oberon Media’s i-play division has launched Bubble Town: Party Planet (an upgrade to Bubble Town, a title that’s been played over 120 million times) on Facebook, featuring a free-to-play methodology. As with 99.44% of all free-to-play titles, Bubble Town: Party Planet allows players to use RMT (Real Money Transactions) to purchase virtual items and goods for their in-game characters.

“Oberon delivers a quality gaming experience for all devices and environments, and we see huge opportunity and growth potential with MTX-enabled content. It is our goal to bring a whole new casual gaming experience to players, and a profitable platform model to our Game Center partners,” said Don Ryan, Oberon Media Chief Operating Officer. “We decided to enter this category with Bubble Town: Party Planet because Bubble Town™ is I-play’s most successful online franchise. The new version will entice both new and old fans of the series as it brings the experience to an even higher level.”

Traditionally, Oberon Media has stuck to it’s founding principles of ‘Try before you buy’, whereby gamers can play an unlimited title for one hour, and if they enjoyed it, they’d then be asked to purchase the game. Not a bad philosophy, but in today’s microtransaction focused (and financially beneficial for developers and publishers) market, this concept seems a bit dated. Enter stage left, Oberon Media’s massive shift in their core business plan.

With this in mind, Oberon Media’s CEO Tomer Ben-Kiki stated in an interview that it pays to be cautious. Ben-Kiki admits that by getting into the game in 2003, Oberon Media was a bit late to the first generation casual games party. However, Oberon Media is still very well and alive today, perhaps owing some of the success to the overall quality of their offerings. This quality, combined with Oberon Media’s decision to white label their games, had led the company to publishing it’s products across 250 different sites.

Adding to his ‘caution is key’ statements, Ben-Kiki states that a diversified games portfolio is the wisest and financially sound option for Oberon Media. He says that Oberon Media doesn’t want to invest too early in some gaming platforms where profits can remain relatively small, and competition crowded and cutthroat.

“We want the platforms to be mature enough,” Ben-Kiki said. “Once we roll out the business model, we will use it across a lot of platforms where our games are. I see virtual goods as a very important addition. But it is not causing an earthquake in the casual space.”

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SOE Prez John Smedley to deliver keynote at GDC Austin

Friday, August 7th, 2009

If you were in search of this years “The One” gaming convention, look no further. It seems like the gathering in the Lone Star State is shaping up to be a veritable industry ‘who’s who’. Yesterday, GDC Austin officials announced the SOE President John Smedley will deliver a keynote speech detailing the success and lessons learned regarding the recently launched runaway tween success, Free Realms.

john-smedleyHis address, “From Dragons and Daggers to Kart Racing, Cooking and Concerts … It’s a Whole New MMO World,” will detail how Free Realms has worked well for SOE, expanding the title’s base of players and how they engage with each other in online worlds. Smedley is also expected to “inform attendees about the challenges and lessons learned when creating a full-blown MMO for younger audiences,” and complete with research and insights. Ooo…pie charts?

This keynote is a so-to-speak homecoming for Free Realms, as the title was first officially announced at the GDC Austin in 2007. Fast forward to an April 2009 launch, and SOE has seen over 1 million registered users pass through their doors in only 10 days. According to a recent Comic-Con panel, Sony has recently past the 5 million user mark, with no signs of slowing anytime soon in sight.

If a keynote by the man behind EverQuest I and II and Free Realms wasn’t enough to get your feet moving in the right direction, remember, GDC Austin has also confirmed Blizzard co-founder Frank Pearce and World of Warcraft production director J. Allen Brack to discuss the operating challenges and lessons in the talk “The Universe of World of Warcraft.” An naturally, one of our personal favorites, Rebel Monkey CTO Jeffery Kesselman will be on hand and discussing how CampFu “combined open source technologies to build an industrial strength platform for unified multi-player casual game-play and social web experiences” in his talk, “The Monkey Wrench: Design and Architecture of an Online Environment.”

The GDC Austin event takes place at the Austin Convention Center in Austin, Texas September 15-18. This conference is the major focus of a larger gathering also featuring four two-day summits including the Game Writers, Game Audio, iPhone Games and Independent Games Summits. To find out more, visit the official GDC Austin website.

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GameStop creates new position: General Manager of Digital Media

Thursday, August 6th, 2009

America’s best known brick-and-mortar retailer of all things digital gaming, GameStop has announced that they’ve recently appointed Chris Petrovic to fill the newly created position of General Manager of Digital Media.

gamestopThis new appointment clearly indicates that the retailer can no longer ignore the proliferation of digital downloads and game acquisition, even though the company has downplayed the mechanism previously. Heck, even David Perry has called GameStop COO Dan DeMatteo’s “the era of full digital distribution is 12 to 17 years away,” comment ridiculous, pointing out that the vast majority of the Asian market is dependent on digital distribution. In regards to Petrovic’s appointment, and GameStop’s interest in digital distibution, DeMatteo states that the retailer is well-positioned to “[identify] and effectively [participate] in emerging trends in casual, browser, and mobile gaming.” Sure, there’s no harm in showing up to the party after dinner is served, right? Further to this, DeMatteo stats, “We are … committed to supporting our unique and vast footprint of brick-and-mortar stores and knowledgeable associates with a smart digital business platform.”

Petrovic’s appoint comes on the heals of last Friday’s announcement from GameStop that they’ve launched an online digital casual game store, and revised the overall digital distribution store for the bread and butter PC games market. Direct from GameStop: “Petrovic will be responsible for building on the company’s ongoing efforts to integrate digital media into the company’s multi-channel strategy, as well as overseeing the development and execution of a digital acquisition strategy.”

Prior to coming to GameStop, Chris Petrovic served as VP of digital media at Playboy enterprises, where he was responsible for leading online and mobile projects. He’s also filled executive shoes at the interactive division of greeting cards firm American Greetings, as well as theglobe.com and Prime Ventures.

Is it just me, or does it sound like all the cards are not on the table here? On one hand we’ve got a COO stating that full digital distribution isn’t going to happen for another 12 to 17 years, and that the company is confident in it’s market stance to remain right where they are. On the other hand, GameStop opens an online digital casual games store, only to be followed by the creation of the position of Head of Digital Media. Granted, in today’s market, diversifying your offerings and methods is the smartest way to stay competitive, so why not get the messaging straight here folks? Either GameStop is committed to a digital distribution method, and will put the same type of support behind it that they do with their brick-and-mortar retail divisions, or just leave it alone. The conflicting messages aren’t exactly demonstrating the “We’re all on the same page” message one would like to see from a major retailer. I’m all for GameStop providing a digital distribution service. It certainly saves me a trip to the store, and puts the product in my hands in a matter of minutes, not hours or days – but can’t we all just agree to agree?

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EA reports (almost) positive cash earnings – sees dramatic rise in digital distribution and virtual goods sales

Wednesday, August 5th, 2009

Electronic Arts seems to have outwitted their critics and come very close to a break even, and almost, dare I say it, a positive cash flow. Posted yesterday, EA’s Q1 financial results demonstrate a dramatic improvement in the coffers, reporting a net loss of only $6 million. Granted, 6 million clams is nothing to jump for joy over, especially when it’s $6 million in the red, but when compared to year-over-year results, it’s more than enough to get excited about. Last years Q1 results showed EA with a $135 million loss. Keeping $129 million in the bank account is a tremendous success for the Redwood, California firm.

ea_logoEA’s first fiscal quarter revenues peaked at $816 million, a dramatic 34 percent increase of 2008’s $609 million. Industry analysts had projected a meager take of only $729.5 million. EA’s digital distribution and virtual goods sales are a major contributor to the over projected earnings take, bringing in approximately $124 million, a noteable 38 percent increase year-over-year.

Putting some wind in EA’s sales (literally) are a string of successful titles and their surrounding executions. Compared to the quarter ending in June 2008, in 2009 EA was the number one publisher in both North America and Europe, with four out of the top ten games. Four of EA’s titles won Best of E3 awards: Mass Effect 2 won best RPG, Fight Night Round 4 took the Best Sports Game award, Star Wars: The Old Republic snagged Best PC Game, and Left 4 Dead won Best Online Mulitplayer. Additionally, while a perennial favorite, and old standby, the Sims franchise was a major factor in EA’s revenue streams this year. Holding the top selling retail sales title in Europe and North America for this past quarter, the Sims 3 moved 3.7 million copies out the door. And last but certainly not least, EA Sports Active helped the company garner a 21 percent market share of the wii market in North America and 13 percent in Europe. Having sold over 1.8 million copies, EA Sports Active is now the company’s best selling wii title to date.

“Good execution delivered better-than-expected financial results in the first quarter,” said John Riccitiello, Chief Executive Officer. “We are very pleased with the success of both The Sims 3 and EA SPORTS Active.”

Looking ahead, briefly discussed the upcoming Tiger Woods PGA Tour title which seeks to drive revenues from the sale of game subscriptions and virtual goods sales, as opposed to the one-time-only-buy-it-in-a-box method. With that said, and keeping EA’s open experimentations with the free-to-play/microtransactions supported model (think Battlefield Heroes) in mind, company president John Riccitiello commented in an earnings call yesterday that EA’s not 100 percent onboard. “A lot of people believe that microtransactions is going to be the lead business model in the US. I’m not so sure about that. We are seeing good microtransaction results on Pogo, but I do think there is a difference between the way that consumers buy and consume content in Asia.”

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Sony/Double Fusion ad HD IGA’s to WipEoutHD – gamers cry foul

Tuesday, August 4th, 2009

In principle, this concept sounds awesome, groundbreaking, stupendous even in the boardroom. However, it looks like someone overlooked that one important step of ‘unobtrusive’ when programming the 1080p quality in-game advertising.

WipEout HDBundled into the new Fury DLC pack, Sony’s tapped IGA provider Double Fusion to retroactively fit the title with some revenue generating ads. No problems thus far, as it’s a pretty fair statement to make that 99.44% of gamers are used to seeing a billboard ad or two, and of course the blatant Coca-Cola vending machine, etc. For the most part, these in-game ads aren’t getting in anyone’s way of game enjoyment, and arguably ad a further touch of realism to the experience.

Again, Double Fusion gets credit for being the first IGA firm to implement true 1080p quality advertisements into a video game. And fittingly, the firm chose a futuristic title to kick off the HD ads campaigns in. “By introducing high-resolution dynamic video ads into WipEout HD, Double Fusion is responding to advertiser demand and offering an engaging ad format while pushing in-game ad innovation to a new level,” said Jonathan Epstein, CEO of Double Fusion. “The title is one of the most popular and visually stunning available on the PlayStation Network and a perfect vehicle to connect advertisers to a captivated audience. It comes as no surprise that advertisers have already signed up for WipEout HD even before the launch of the new video ad units in the game.”

Ok, again, so far so good. So as the classic Wendy’s advertising campaign questioned, “Where’s the Beef?” The beef comes our way via seconds. Let’s be honest: load times are a bummer. Every game under the sun has them, and it’s just the way things work. However, keeping players engaged in what they’ve paid for, mainly the game, is something that every developer shoots for. Most players would like to be spending their time shucking and jiving, rather than watching a scrolling progress bar. To that end, it looks like Double Fusion and Sony are placing advertising dollars over gamer satisfaction. As demonstrated by Ryaldeco, the standard load time for WipEout HD is around 8 seconds. Compare this load time to what now takes around 19 seconds if an ad plays.  Ouch.

Fair enough, 19 seconds isn’t go to kill anyone, but when one is used to a load time of half the current state (if an ad plays – reports range from 3 to 5 times per hour), you could see why this has caused somewhat of an uproar from a dedicated community. To add insult to injury, WipEout HD is a paid title. Perhaps if the game were free-to-play, and either microtransaction or IGA supported – well, in that case, players get the title free of charge, so a bit of monetization somewhere is to be expected. However, for players that have already laid $20 (or so) down….

Again, in principle, Double Fusion is to be commended for pushing the envelope, and utilizing previously untapped resources to push the format forward. On the other side of the coin, it’s a shame that progress comes at the cost of time, which ultimately leads to engagement.

Update: Eurogamer is reporting that Sony has pulled the offending ad.  “The ad has been removed from WipEout HD and we are investigating the situation to ensure that any in-game advertising does not affect gameplay,” said a Sony spokesperson.

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SOE Seattle studio execs ready to Detonate

Monday, August 3rd, 2009

We’ve all heard about an exodus or two from EA, but not so much from Sony Online Entertainment. Well, reset the brain drain clock, as Eurogamer recently spotted a few names missing from SOE’s Seattle studios register.

detonator games logoStudio Director and Executive Producer Matt Wilson, Art Director Corey Dangel, and Producer John Smith officially called it quits at the Pacific Northwest SOE studio at the beginning of July. The trio has struck out on their own with Detonator Games, a new player to the Facebook, MySpace, Bebo (amongst others) social gaming category. From the company’s recently launched site:

Detonator Games takes social game play to new and explosive levels. We build high quality games that unite multiple social platforms in a common goal of fun. We’re totally dedicated to creating entertainment overflowing with the attitude, emotion, and fun that drive players together. In short, we connect people through play.

Wilson and Smith were founding members of the Seattle SOE studio, an original acquisition by Sony of the then titled Fireant. Previously, the team had been involved with Microsoft’s developed, but never brought to market MMO Mythica. In the interview with Eurogamer, Matt Wilson comments, “It’s true that Corey and I no longer work for SOE. This was a very hard decision to make, but it’s the right decision for both us and the project. There were a variety of factors into making this decision, but we wish SOE and The Agency the best success.”

Ah yes, The Agency. This anticipated spy/James Bond –esque title has been in the works since early 2005 at the SOE Seattle studio. There’s even been microtransactions talk surrounding the game. Originally aiming at a 2010 delivery date, some sources in the Seattle gaming community are speculating that the studio will need to regroup, have a think, and perhaps revamp and modify the game, ultimately delaying the launch.

Conversely, SOE comments, “The Agency is not undergoing a reboot of any sorts – that is incorrect. The team in Seattle is still working diligently on this project and we’re looking forward to showing you new content in the future.”

While there are only three guys and one corporate megalith that know the full details of the departure from, foundation of, and the status of The Agency, I believe what we’ve got here is nothing more than a team of entrepreneurs that didn’t want to work for the Man any longer, saw a lucrative market, recognized their skills and knowledge, and went for the opportunity to create something of their own. Detonator Games has been wisely building anticipation of their initial release via a facebook fan page, as well as regular updates on twitter.

Are there already too many social games developers out there at the moment? It really depends on how you look at it. However – how many social gaming companies out there can boast three former SOE execs at the helm? Exactly. We’ve joined the Detonator Games fan page, and will be keeping a close eye on what the folks in the Emerald City have in store for us.

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