http://gametheoryonline.com/2010/07/28/video-games-industry-gaming-business/

"Their biggest immediate worry: Surviving the complete and utter transformation of a business that once was dominated by packaged goods to a new paradigm ruled by downloadable, online, social, community-driven and service-based offerings."

"The industry is really being turned inside out.” Maybe so, but as you’ll see in the above video, it’s also one poised to elevate new captains of industry, and potentially leave even the field’s most iconic firms capsized in its wake. Consider it a simple reminder – rather than focus on random fancies such as motion controls and 3D special effects, perhaps we’d all do well to remember that behind the scenes in 2010, there’s a much larger game at stake."

This is why Nintendo wasn't mentioned. The maker of the video is part of the industry mindset that malstrom critisizes.

Don't know much about Trip Hawkins, Can't say much about Peter Molyneaux coz I reckon he's done nothing revolutionary. Cliffy B is pretty much the face of Epic Games and is the reasons why Epic Games still exists with Gears and the UE3 and Michael Pachter... Dunno what he's done for the industry either.

Nice, small, quotable, true.

::high five!::

I remember his reaction on Gamasutra article regarding casual games on PC. Both worth reading.

Gamasutra: The price of download games has dropped in the past year from an average of $20 to $7 per game. That’s a 65% drop in price, meaning developers need to sell 2.5 more per game to make as much as before. The demand for casual download games is growing, but at a much slower rate to offset the drop in price (my guess is 10 – 15% yearly growth)...

I’m not saying it’s possible to get the average price back to $20 per game. There are too many cheap and free games online, on Facebook and the iPhone (that’s a reason why we are covering them more). But, $7 does not work. A desk for $1,000 made by craftsmen is higher in quality than a $200 desk you buy at Walmart made of particle wood. It’s the same with download games.

Malstrom: When an entertainment is in trouble, be it a TV show to a movie to a video game, the problem is almost always the content. Content! Content! Content!..

So you want to make a cell phone game. Fine. But consider the customer doesn’t have nearly as much competition on in an entertainment standpoint where he carries his cell phone. The poor husband whose wife drags him around while she does shopping will love his cell phone games not because of the games, themselves, but because they are more entertaining than watching his wife spend his money on clothes she doesn’t need. When the husband gets home, does he continue to play the cell phone games? No! He flops down on the couch and turns on the football game. He only plays cell phone games when he is cornered outside with no other options.

Consider the DS and its rise. You knew something special was going on when people were playing their DS in their homes despite all the other options of entertainment they could be doing. People were playing their DS systems in front of their Wii and Xbox 360s and would admit at the time it felt funny doing so. “I am at home. Shouldn’t I be playing my home console?” But the games on the DS, at the time, were so compelling that he didn’t care.

Paying between $5-10/month, I (as the neurotic asshole I am) would memorize how many multiplayer maps the game launched with and expect at a rate of $5-10/month for the game developer to double and triple the amount of multiplayer maps every year that I am paying.

If I bought an FPS for $60 and it launched with 12 multiplayer maps, allowed a month free multiplayer access, and then I had to pay $5/month for continued access after my free month expired, I would expect the FPS to have 24 multiplayer maps a year after it is released, 36 the 3rd year, 48 the 4th year and on.

No, I don't see this happening and if it does, it better be a religious revelation everytime I play the pay-for-play FPS.

Furthermore, the failure of of a MMOJRPG with a storied past (Final Fantasy 11) and many more beloved games than the World of Warcraft is a necessary history lesson for any game developer who thinks online, pay-to-play is the way to go.

Do Pachter and his ilk think the World of Warcraft would have been a success without WarCraft, WarCraft 2, and WarCraft 3? If they do, then they are missing the reason why the World of WarCraft took off when it did and why it has stood apart and ontop on all other WoW-killer wannabes like the Age of Conan and WarHammer Online.

Games will pay for quality when the company putting out the pay-to-play game has a 10 plus year track record of quality along with the MMORPG picking up and finishing story lines from the previous games.

The only other company who I can see profiting off of pay-to-play is BioWare due to their history of beloved franchises such as Baldur's Gate, Neverwinter Nights, Star Wars: Knights of the Old Republic, Dragon Age, and Mass Effect.

I wonder many times why Final Fantasy 11 failed, while the World of Warcraft prospered? My best answer is that each WarCraft game builds off the other so that there is a continuous history for the gamers to expect to be adressed in the MMORPG, while each Final Fantasy game is a new game entirely different from the previous in story.

Looking at Final Fantasy 11, I could not tell if it was going to be set in Cecil's universe, Terra's universe, Cloud's universe, Squall's universe, Tidus's universe, or something entirely different. It ended up being the latter with chocobos and airships.

I would have picked up and stayed with Final Fantasy 11 if it was in Terra's universe where they did the World of Balance and then had a server event for the transition into the World of Ruin, but they had to go and make me not buy it by not placing the story in a Final Fantasy universe I knew.

I find this video absolutely hilarious.

The jist of what they are saying, "The business model is broken. I multiplyed my cost by a factor of x10 and revenue is only increasing by a factor of x2 or x3." The model current is working just fine now days, just ask nintendo.

The developers need to get their finances in line and start making cuts where they are actually effective and needed. Everyone has noticed they have been cutting content and selling its as DLC - this is the wrong place to cut cost.

Some ways to cut costs - use no name voice actors or no voice acting at all, program for a lower native resolution and just have the hardware upscale it, manage a marketing budget porportional to the actual cost of development of the game, downsize teams and redundant management, use a styleized approach to cut cost further, etc.

Example: Demon's Souls broke even on costs after only 75,000 units and the game looks and plays pretty nice.

Following this, you would have the same gameplay, same story, probably more content since it is less costly, and the development cost would PLUMMET! You could sell half as many games and make MORE money.

*Sigh* Sometimes I think common sense is the least common of all the senses...

When fantastic games like Uncharted and Gears can be developed with an 18 million dollar budget, it really makes me wonder what the money is being used for in a lot of games.

i do see how this could apply to almost any game , though you would have to micro manage what your DLC content's direction, and focus is going to be and key is price of that DLC to make sure the attraction is there will benefit's that will keep consumer's happy enough to pay for somthing they feel would be worth the added benefit without seeing that it's required,but as an incentive to buy to increase enjoyment of the product.

I think it could fit in with any game , you as a developer have to look at what direction that a DLC content model can be worked.

An if that is feasable.

As much as I dislike Peter Molyneaux and his big mouth, he deserves credit for creating the God Game genre with Populous, which was an awesome game for its time. I don't think he did anything revolutionary besides that.

As long as there is Nintendo there shall be AAA quality games. NINTENDO FOREVER!