Core gamers are increasingly entitled and impossible to please...not to mention increasingly high risk / high reward...and more and more difficult to profit from. Activision is THE ONLY routinely profitable western third party catering to core gamers, primarily because of COD & Blizzard. EA / Ubisoft / THQ / Take Two / Majesco / Codemasters all routinely lose money, and did even at the peak of the cycle. In Japan, Sega, Namco-Bandai, and Konami are pretty well diversified and typically do profit, but Capcom / Square-Enix, Tecmo-Koei are more "core focused" ala the Western companies and also have tended to lose money.
Look at the last five years -
- 124 developers bankrupt because you need to sell 500,000 copies for a low budget PS3 / X360 game to break even, and 1-2m isn't uncommon for breakeven now.
- Sony has laid off over 20,000 people because the margins from it's gaming business have declined as Sony tried to catch up with Microsoft's core offerings
- Microsoft's EDD has had three years out of 12 in the video game industry of net profit
- Core gamer tastes have standardized around major brands. There are really only 10 core brands that matter globally, that routinely lead to increased corporate standing and power within the industry (typical entry > 5m). You can be under 5m and profit obviously, but the games below are the ones that sustain innovation and pay for flops.
Capcom (Resident Evil)
EA (Madden, Fifa, Battlefield)
Activision (Call of Duty)
Square-Enix (Final Fantasy, Dragon Quest)
Ubisoft (Assassin's Creed)
Konami (Metal Gear)
Take Two (GTA)
- "Casual" gamer tastes have also consolidated around major brands in the past five years although it is more unstable.
Majesco (Zumba Fitness)
Ubisoft (Just Dance)
Nintendo (Wii series)
Microsoft (Kinect series)
Harmonix (Dance Central)
Activision (Hero games)
EA / Harmonix (Rockband)
Nintendo can theoretically bridge the top stuff from both worlds better than Sony or Microsoft, but it's still not an easy thing to do. A healthy Wii U though could have, at least in theory, all of the following 5m level hits that could be up for grabs or at least up for port:
FF, DQ, RE, GTA, AC, Fifa, Madden, Battlefield, Metal Gear, COD...Just Dance, Zumba, Wii series games (Fit, Sports, Sing)...and then 2D Mario, 3D Mario, Zelda, Mario Kart, Smash, Mario & Sonic, Mario Party, and Nintendoland.
DQ (5m on DS), RE (1-2m on GC / Wii), Madden (about 1m each iteration on Wii), Metal Gear (1m ltd likely on 3DS) and COD (1-2m) are all known to do respectable numbers (1-5m) on recent Nintendo platforms so I don't think it's a huge leap for Nintendo to try to get most of them.
People are difficult to govern because they have too much knowledge.
When there are more laws, there are more criminals.
- Lao Tzu
