“Social” gaming is the future
As Gaming Turns Social, Industry Shifts Strategies
Even before Electronic Arts roiled the video game world on Sunday with its $2 billion hostile takeover bid for Take-Two Interactive, even before Phil Harrison, president of Sony’s worldwide game studios, announced his resignation on Monday, one could plainly see the creative and financial disruptions underlying the industry’s explosive growth.
Last week more than 17,000 artists, writers, designers and executives convened here for the annual Game Developers Conference. On the surface there was little news: few major announcements of new games, few major deals. But in private it was easy to read the sea changes reshaping what is now an $18 billion domestic industry as it grows from niche pastime to mass medium.
Those themes emerged perhaps most clearly during talks with executives from each of the industry’s three titans: Reggie Fils-Aime, president of Nintendo of America; John Schappert, a vice president in Microsoft’s games business; and, certainly not least, Mr. Harrison himself. Mr. Fils-Aime was riding high, while the others appeared to be trying to figure out how to catch up. And this was just days before Mr. Harrison announced his resignation and before Electronics Arts effectively conceded that it too feared being passed by.
The big story in the game industry’s tremendous growth over the last few years is that the smartest companies are finally designing games and game systems that appeal to the broad public, not just a small cadre of tech-savvy youngsters. Nintendo’s fabulously popular Wii console is Exhibit A, but is also joined in that vein by games like Guitar Hero, Dance Dance Revolution, World of Warcraft and even casual office games like Spider solitaire, Bejeweled and Peggle. In short, companies that are making games more accessible are growing like gangbusters, while traditional powerhouses with a traditionally limited strategy of building around the same old (if you will) young male audience have stagnated, both creatively and on the bottom line.
It just happens that the roster of old-school industry laggards includes big names like Electronic Arts, Microsoft and Sony. The leaders of the new wave include companies like Activision, Blizzard, Nintendo and PopCap. This is the dichotomy that became so clear here at the Game Developers Conference.
But Mr. Harrison blatantly stole the show by baldly admitting that his own bosses at Sony’s brain trust in Japan completely misgauged the direction of the entertainment industry. In designing its latest console, PlayStation 3, Sony focused on delivering high-tech single-player experiences, while Nintendo has dominated the market with the Wii by identifying and delivering casual, social games. Mr. Harrison tried to emphasize casual play with products like Buzz, the EyeToy and SingStar, but he said he was not supported by the corporate mother ship.
“It’s a very interesting and frustrating thing for me to experience because I have been banging the drum about social gaming for a long time,� he said. “And our Japanese colleagues said that there is no such thing as social gaming in Japan: ‘People do not play games on the same sofa together in each other’s homes. It will never happen.’ And then out comes the Wii.�
It is clear now that Mr. Harrison felt emboldened toward candor because he knew he was leaving. It is rare to hear an executive from a Japanese company admit a major strategic mistake, which is what makes Mr. Harrison’s comments so interesting. Microsoft, however, has a different culture. Self-criticism is demanded, and the company has shown that it excels over time at adapting to and perhaps even co-opting its rivals’ best ideas.
That’s why I was not especially surprised to walk into a meeting with Mr. Schappert of Microsoft and find the walls covered with posters that looked as if they could have been ripped straight from Nintendo’s marketing playbook. Those posters actually conveyed more about Microsoft’s attempts to adapt to the new gaming market than almost anything Mr. Schappert could have said.
Here’s why. Traditionally game advertisements, whether in print or on screen, have focused, naturally, on showing the game. But as it introduced the Wii, Nintendo devised a marketing breakthrough: Rather than show the game, show the players. In an entirely counterintuitive, brilliant move, most of Nintendo’s ads are now shot from the perspective of the television back out at the audience, showing families and groups of friends having fun together. Nintendo realized that emphasizing the communal experience of sharing interactive entertainment can be more captivating than the image of some monster, gangster or footballer on the screen.
As Microsoft first broke into the game console business with the original Xbox in 2001, it focused on trying to build “street cred� with hard-core gamers. That meant a violent flagship franchise (Halo), a robust online service (Xbox Live) and a macho-looking machine (think of extruded black plastic).
With the Xbox 360 Microsoft went with a more female-friendly physical design of concave white, but its main marketing and game-making efforts have remained focused on the core young male player.
But that may finally be changing. At the conference Microsoft’s big push was about “democratizing� game development by letting small teams and even individuals develop casual games for the Xbox Live service. And there on the walls of Mr. Schappert’s conference room were new Xbox posters essentially identical to the theme Nintendo pioneered: shots from the front of healthy happy families and groups of young adults playing the Xbox 360. “Imitation, of course, really is the greatest form of flattery,� Mr. Fils-Aime of Nintendo said the next day.
Cool, calm and confident, Mr. Fils-Aime said his biggest problem these days was simply keeping up with demand for the Wii. Nintendo is making 1.8 million Wii units a month worldwide, and it simply can’t keep enough on the shelves even now, almost 18 months after the system’s debut.
But Mr. Fils-Aime didn’t gloat. After all, Nintendo spent enough years in Sony’s shadow quite recently that he understands that Nintendo has not won yet.
“Really we’re just getting started,� he said. “This is about showing all consumers regardless of age or technical background that they can enjoy a gaming experience. And there are many consumers who are not going to stand in line at Best Buy to get the Wii. Until we achieve full distribution we will be scratching the surface in terms of fulfilling the idea that everyone can be a gamer. But we’re getting there.�
I found the article because of the latest edition of KCRW’s The Business, via podcast. No transcript available, unfortunately. The Business is always a good listen, though, for those who have the 30 minutes to burn.
No Comments »
No comments yet.
RSS feed for comments on this post.
Leave a comment
Line and paragraph breaks automatic, e-mail address never displayed, HTML allowed: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>
