Modern Times - Budget Analysis ...

[theRepublic]

jammy2211 said:

theRepublic said:

jammy2211 said:

theRepublic said:

NJ5 said:

Thanks celine. This part is almost scary to read considering the time it was written at:

The answer has to do with a concept called "market share". The basic strategy is to "buy market share". That is, you spend a lot of money to make a product that will sell very well. You still lose money on the product, but the huge sales you make put you in an excellent position to make money with a followup product.



The concept is sound and has been proven to work in many markets with different products. Unfortunately, there's an unintended side effect of such products in our industry: they raise the expectations of the consumers to levels that simply cannot be sustained. Once a customer has been dazzled by a money-losing yet fabulous product, he'll turn up his nose at a normal product delivered on a normal budget. And this is precisely what is happening to our customers. Nowadays, if you don't spend a half-million-plus on your product, it won't sell.

 

This is prety much what I have been saying about projects on the 360 and PS3.

 It's a trend that has been happening for 15 years+ and is elusive in gaming on all platforms.

As I said above Wii developement budgets (or at least marketing) is only going to get bigger and bigger, causing the smaller budget stuff to be ignored and thus the trend illustrated will continue. Just in a less tradional sense of the money being focused not on making a (subjectively?) better game, but on making the most marketable project with the widest mainstream appeal.

 

This is much less of a problem on the Wii.  There are plenty of smaller budget, innovative projects on the Wii.  I don't see many of those on the 360 or PS3.

As it currently stands, the technology in the 360 and PS3 has outpaced the business model of the industry.  The people who own these systems demand amazing, realistic graphics for every game.  That doesn't make sense.  Not every game can be a multi-million dollar production.  There needs to be middle and lower end games for every console.

 You're totally missing the whole point of everything the OP's article cites and anything I said. It's 2am here and I have to get up early so I'm going to bed but I'll try leave you with the simplest way of explaining what the article is saying.

 In short, companies will always strive to have more and more successful projects, it's an evident trend in gaming for all it's exsistance. Traditionally this involved better graphics, more impressive tech etc. Wii has changed the focus somewhat, instead to have a huge behemoth seller the money needs to be pumped into market research and actual marketing. IT's still huge amounts of money and as the industry always does, it's inevitable that soon Wii projects will be huge $20 million+ total budget 'gambles' as the likes of EA and Activision use the same strategies that got them to the global gaming companies they've always used.

 The money Nintendo spend marketing their games is probably far above an 'average' PS360 games total budget for marketing and dev costs etc, I've got no real source on figures aside from Wii Fit's $40 million advertising in just the USA though. Nintendo can afford it though, cause every advert sells them consoles, and they don't have to pay royalties leading to bigger profits etc.

The only reason it's not so evident yet is the market is new territory and EA and Activision and any of the big players don't know how to make these investments successful. They'll figure it out though, and then budgets will increase, lesser known software will be ignored and gaming costs go up just as they always do.

 To be honest I'd imagine that post was a bit of a mish-mash as I was trying to make brief something which needs a long explanation (Which the OP provided but seemed to go over your head somewhat 0_o). I'll get back to this tommorow if it's not too long for me to give up reading, definitely a great article though.

So you think that Nintendo is spending more and making more profit than any other developer?

No.

Developers are struggling because costs have risen so high.  Nintendo avoided the tech race this gen, and it paid off for them in a big way.