As a proud owner of all three current consoles I'm finding my playing time between them split 47.5%, 47.5% and 5%. Guess which one is the Wii percentage? And I'm serious about the my 360 and PS3 getting equal playing time. Right now I'm mainly playing Mass Effect 2 and God of War 3, two very high quality exclusives and I'm making a conscious effort to give both playing time. So gold stars for Microsoft (and I guess EA) and Sony.
But for Nintendo, you get a sad panda sticker. As a traditionally defined "core" gamer at heart - despite being a husband and father who does not live in his parents' basement - it is no surprise that I spend the vast majority of my console gaming on the big boys. Even so, I really wish I had more to do on the Wii though that doesn't mean more core games. By core I mean graphically sophisticated shooter, action and role playing games that generally appeal to gamers with a solid history of playing such content. Rather, I want cutesy, mesmerizing games with pretty colors. I really liked Super Mario Galaxy despite being unable to deal with its later, tougher levels. I really liked the Wii bowling - until it wore off. Last summer I loved Tiger Woods 10 with the Wii MotionPlus despite the blocky Wii graphics when displayed on an HD television. This past holiday my wife and I played four player New Super Mario Bros. with my cousin and his girlfriend. Of course my cousin and I were always the worst of the four since both ladies played the original Mario extensively in their respective childhoods where neither my cousin nor I had the original NES. (zomg!) I even bought Guitar Hero 3 for the Wii but realized I hated it because it didn't have Sweet Child 'O Mine from Guitar Hero 2 (for my 360) which was the main reason I bought it in the first place. I rented Boom Blox and, for serious, it was FUN! I even read news headlines and checked the weather on the Wii for the entire first week of owning it. And let's not forget the original Sonic the Hedgehog game I purchased online using Wii points or a credit card or whatever and then proceeded to play it once because some shit just doesn't hold up over time.
Despite really, reeaalllyyy wanting to keep dusting off my Wii, I'm caring less and less about it. The lack of real HD-ness doesn't bother me. What bothers me is that regardless of the lack of quality 3rd party games, there is no real online community for the Wii. Sure, the Modern Warfare 2 player base on both 360 and PS3 gets a bad name (esp. on 360) for all the foul language, racial and homophobic slurs, but you can always find a multiplayer or even coop match in most games. In other words, there is always something to do or something to see. I don't play as much online MP on my consoles, but I'm always cruising for the latest demos and even arcade games. On the Wii, I just don't care anymore about whatever mediocre content is there through the Wii channels.
So what does this mean about my desires for an online community on the Wii? I want some kind of fun, low intensity multiplayer experience, whether competitive or cooperative, that is a bright, cartoony, excellentlyer art designyer-ed, thingy-thing...to thing around with. I'm not even sure what I'm getting at. Give me a cartoony wooden crate to smash with a paddle in a bleach white Matrix loading program type environment whether I see other Miis playing around smashing their own crates. And let puppies and kittens emerge from those broken crates and leave adorable poops on the sterile white floor. Pets who emerge from my smashed crates are red and poop pink poops while pets who emerge from other Mii's crates are green and their pets are lime and they poop teal poops. I have to move around and dodge teal poops while other Miis must dodge my pets' pink poops all while we try to put black leashes on each others' pets to get them to stop pooping. Award sad panda points for touching teal poops and gold stars when your opponents touch your pets' pink poops. Add a round timer and you're done. This is a Wii multiplayer game that you could probably release as an operating system patch.
I don't know, give me something Nintendo. And more importantly, recall my cousin mentioned above. He lives a quarter mile away, has a Wii and somehow we have never connected to each others' Wii in any type of multiplayer or multiuser online environment.
To me, this is the biggest missing element in the Wii.
Thursday, March 25, 2010
Friday, March 19, 2010
Free 2 Play, not just for games anymore
In today's LA Times I read an article about how tiny amusement parks are drawing visitors while the big well known theme parks operated by major players like Six Flags and Disney are seeing declining attendance and revenues. In particular, the article says:
So basically these smaller parks are free admission and you pay a ride at a time, a complete contrast to big parks like Disneyland or Universal Studios where you pay $60 or more for admission, another $10 to $20 to park and because you typically are not allowed to bring outside food (right?) you pay $4 per churro, $3.50 for a 16 oz bottle of Dansani, $9.95 for a personal pan pizza and $24.95 for a set a photo of you and your loved ones screaming while coming down the massive "waterfall" in the Jurassic Park ride. With any luck you can avoid paying bail for your older, balder and fatter son.
...tiny beach-side amusement parks along the California coast are reporting robust business and big crowds while most of the state's big theme parks have seen shrinking revenue.
Small, privately owned seaside parks, such as Pacific Park at the pier in Santa Monica, Belmont Park in San Diego and the Santa Cruz Beach Boardwalk, don't have multimillion-dollar advertising campaigns or 3-D attractions as do Disneyland and Universal Studios Hollywood. But they boast something even more appealing to penny-pinching tourists: Free admission.
As a result, vacationers are turning to old-fashioned Ferris wheels and carousels over expensive, high-tech thrill rides.
Ok, so all the extra and expensive things you pay for at a Disneyland or Universal Studios would be extra in a small park, too, so that isn't much of a difference except perhaps the grandeur and pricing scale. For the admission component, however, there is a huge difference between the small guys and the big guys.
The small guys are like Free 2 Play (F2P) games where the game is, yes, free to actually play it. You only pay for the extras like maybe access to higher levels or certain areas of the game or items and pets and weapons or chances to win a prize. So you can play all you want within the limits of the game and pick and choose what you pay for. Or you simply pay to speed up progression though different aspects of the game.
The big guys are like premium MMOs
F2P games can get expensive, too, but in a way the pricing is fairer. Lite users pay less while heavy users pay more. Though to be fair some heavy users never pay in some MMO games and some lite users pay to speed up their progression and ironically play for less time than the heavy users. Whatever the terminology, you pay as much as your are willing to based on your own needs. In essence it is a more accurate pricing model in that users pay for what they consume with more granularity. With traditional subscription MMOs the only consistent metric of play user is number of hours per period. A user who plays 100 hours in a month pays the same as someone
who plays only 50 or as much as 200. (Note, if you or anyone you know plays any MMO for 200 a month you or they can no longer be killed because you cannot kill that which has no life...)This is not an endorsement for F2P games. It's just that while the packaged goods video games business struggles with profitability, the F2P games in Asia are making a killing. Even Facebook games which make money using similar F2P models are starting to make money and the biggest Facebook game developers (Playfish, Zynga, etc.) are making a lot of money.
F2P models and traditional MMO models will probably peacefully coexist for a while, and it is unlikely World of Warcraft will go F2P anytime soon. If we go back to the F2P style amusement parks vs. Universal Studios and focus only on access to rides (and not parking or food or crappy memorabilia and highly flammable winnable stuffed animals for little Susie) we are left with paying per ride vs. paying a large entrance fee and ride as much as you want...or at least as much as you can stand reading "45 minute wait from this spot" signs for hours at a time. In other words, we're talking about F2P vs. the $60 one time fee for a typical high-end console game. And what I am saying is that eventually, the F2P games will start threatening the $60 disc based game market. It's not a question of if but when.
This isn't to say that tomorrow the retail publishing businesses of Activison, Ubisoft, EA and all their friends are doomed, or that the retail market is destined for total annihilation. It's just that these publishers are going to have to adapt in response as the F2P model gains further traction in Western markets.
Monday, March 15, 2010
Feb 2010 NPD recap
Last Thursday while GDC was still going strong in San Francisco, NPD released February 2010 retail sales data. Per the usual Industry Gamers picked up the story and published the top 10 video game titles of the month courtesy NPD:
Hardware dollars sales were down 20% from February a year ago, while software was down 15% and accessories were flat. On the whole the month was down 15% from a year ago.
Below is a reprint of the top 10 from Feb 2009:
Observations:
1) No PSP titles made the top 10 in Feb 2009 or Feb 2010. Same story as Jan 2010 vs. Jan 2009.
2) No DS titles made the top 10 in Feb 2010, while Mario Kart and Super Mario Bros (both 1st party) made it in the top 10 in Feb 2009. Again, this is the same story as Jan 2010 vs. Jan 2009. And Feb 2010 DS hardware sales were 613k, slightly higher than Feb 2009. So despite selling a little more DS handhelds vs. a year ago, there were no DS titles in the top 10. Overall vs. Feb a year ago, DS software sales were actually down by 15%. Wait...DS hardware sales up slightly while software sales down by 15%. Ouch. Where are all those software sales going? (more on that below...)
3) Three Wii titles made the Feb 2010 top 10 vs. four in Feb 2009. No big deal there. But Wii titles ranked 2, 4, and 5 whereas in 2009 the ranks were 1, 4, 6, and 10. That's another indirect signal of Wii software decline besides the fact that total Wii hardware sales in Feb 2010 were only 398k, a huge decline from Feb 2009. Others have said and I will say it, too: the Wii needs a stimulus package or some kind of Nintendo bailout in 2010 if its business is going to pick up steam. Yes, there have been supply problems. But after all this time if demand is still that strong to outstrip supply, you'd think Nintendo would keep the retail inventory a little higher? What's up with that?
4) Next we get to the "concentration percentage" that I failed to coin when looking at last month. By that I mean, what percentage of total unit sales for the month were represented by the top 10 titles? In Feb 2009 the top 10 sellers by units represented 16% of total software unit sales. In Feb 2010, it rose to 20%. That isn't terribly concerning, however total software unit sales were down by 16%. Once again, the top titles are taking a larger share of a shrinking market. Still, we are in a worse economic climate for video game sales now than a year ago before the bottom dropped out so comps aren't exactly apples to apples...but still, it's a stat to watch.
5) Despite the brewing legal battle between Activision and the two Infinity Ward studio execs it fired on March 1, Modern Warfare 2 is still selling: 314k units on Xbox360 and 253k units on PS3, meaning MW2 on PS3 was 80.5% of the sales on Xbox360 for the month. In January 2010 the PS3 to Xbox360 ratio for MW2 was a similar 79%. Compared to other big multiplatform launches, this is a higher ratio. Good news for Sony.
6) Speaking of point #5 above, Bioshock on Xbox360 did 563k units, while on the PS3 version did not register in the top 10. That's a much lower ratio of PS3 to 360 units. Not so good for Sony.
Back to #2 above...
Where are all those DS sales going? Despite the general management declarations from both Sony and Nintendo, the iPhone and iPod To
uch are defacto competitors to the PSP and DS. On Dec 31, 2009 in my last 10 years recap post I talked about how there was data showing iPod Touch app/game downloads spiked much higher than iPhone app/game downloads on Christmas day, indicating the iPod Touch was a big Christmas present. Beyond that data, I have been noticing more kids playing with these Apple systems and fewer playing with DS and PSP systems. That is not scientific evidence nor should it be misinterpreted as proof that the iPhone is eating into the DS/PSP market. Instead, I am simply asserting based on pieces of data I have seen plus my observations of kids around Los Angeles (and San Francicso...and Chicago...) that, in fact, the iPhone is starting to cannibalize the DS/PSP market. If you have supporting or counter evidence, please do let me know.
Hardware dollars sales were down 20% from February a year ago, while software was down 15% and accessories were flat. On the whole the month was down 15% from a year ago.Below is a reprint of the top 10 from Feb 2009:
Observations:
1) No PSP titles made the top 10 in Feb 2009 or Feb 2010. Same story as Jan 2010 vs. Jan 2009.
2) No DS titles made the top 10 in Feb 2010, while Mario Kart and Super Mario Bros (both 1st party) made it in the top 10 in Feb 2009. Again, this is the same story as Jan 2010 vs. Jan 2009. And Feb 2010 DS hardware sales were 613k, slightly higher than Feb 2009. So despite selling a little more DS handhelds vs. a year ago, there were no DS titles in the top 10. Overall vs. Feb a year ago, DS software sales were actually down by 15%. Wait...DS hardware sales up slightly while software sales down by 15%. Ouch. Where are all those software sales going? (more on that below...)
3) Three Wii titles made the Feb 2010 top 10 vs. four in Feb 2009. No big deal there. But Wii titles ranked 2, 4, and 5 whereas in 2009 the ranks were 1, 4, 6, and 10. That's another indirect signal of Wii software decline besides the fact that total Wii hardware sales in Feb 2010 were only 398k, a huge decline from Feb 2009. Others have said and I will say it, too: the Wii needs a stimulus package or some kind of Nintendo bailout in 2010 if its business is going to pick up steam. Yes, there have been supply problems. But after all this time if demand is still that strong to outstrip supply, you'd think Nintendo would keep the retail inventory a little higher? What's up with that?
4) Next we get to the "concentration percentage" that I failed to coin when looking at last month. By that I mean, what percentage of total unit sales for the month were represented by the top 10 titles? In Feb 2009 the top 10 sellers by units represented 16% of total software unit sales. In Feb 2010, it rose to 20%. That isn't terribly concerning, however total software unit sales were down by 16%. Once again, the top titles are taking a larger share of a shrinking market. Still, we are in a worse economic climate for video game sales now than a year ago before the bottom dropped out so comps aren't exactly apples to apples...but still, it's a stat to watch.
5) Despite the brewing legal battle between Activision and the two Infinity Ward studio execs it fired on March 1, Modern Warfare 2 is still selling: 314k units on Xbox360 and 253k units on PS3, meaning MW2 on PS3 was 80.5% of the sales on Xbox360 for the month. In January 2010 the PS3 to Xbox360 ratio for MW2 was a similar 79%. Compared to other big multiplatform launches, this is a higher ratio. Good news for Sony.
6) Speaking of point #5 above, Bioshock on Xbox360 did 563k units, while on the PS3 version did not register in the top 10. That's a much lower ratio of PS3 to 360 units. Not so good for Sony.
Back to #2 above...
Where are all those DS sales going? Despite the general management declarations from both Sony and Nintendo, the iPhone and iPod To
uch are defacto competitors to the PSP and DS. On Dec 31, 2009 in my last 10 years recap post I talked about how there was data showing iPod Touch app/game downloads spiked much higher than iPhone app/game downloads on Christmas day, indicating the iPod Touch was a big Christmas present. Beyond that data, I have been noticing more kids playing with these Apple systems and fewer playing with DS and PSP systems. That is not scientific evidence nor should it be misinterpreted as proof that the iPhone is eating into the DS/PSP market. Instead, I am simply asserting based on pieces of data I have seen plus my observations of kids around Los Angeles (and San Francicso...and Chicago...) that, in fact, the iPhone is starting to cannibalize the DS/PSP market. If you have supporting or counter evidence, please do let me know.
Tuesday, March 9, 2010
At VCON event at GDC on Wed Mar 10
Tomorrow at GDC in San Francisco at Live Gamer's VCON event I will moderating a panel on "How to bring social functionality into traditional game design…and actually make it work" at 10:30 am. It's in North Hall Room 123 at the Moscone Center. 
I am very excited to moderate the panel because it will provide real insight from 5 social media and gaming experts who have been thinking about this topic long before anyone else had heard the term "social media" and much less "social functionality." The panelests include:
Amy Jo Kim | CEO | Shufflebrain
Kai Huang | Founder | Guitar Hero
Dennis Fong | CEO | Raptr
Dan Fiden | GM, San Francisco Studio | Playfish
Mike Verdu | SVP, Games | Zynga
In our 45 minute panel we will be discussing:
PS. As of right now the agenda still lists my colleague, David Cole of DFC Intelligence as the moderator, and has me co-presenting a talk later in the day with him. It should say that I am moderating the 10:30 am panel and he's doing the afternoon presentation without me but it hasn't been updated on the Live Gamer site yet.
I am very excited to moderate the panel because it will provide real insight from 5 social media and gaming experts who have been thinking about this topic long before anyone else had heard the term "social media" and much less "social functionality." The panelests include:Amy Jo Kim | CEO | Shufflebrain
Kai Huang | Founder | Guitar Hero
Dennis Fong | CEO | Raptr
Dan Fiden | GM, San Francisco Studio | Playfish
Mike Verdu | SVP, Games | Zynga
In our 45 minute panel we will be discussing:
- What do we mean by "social functionality" in traditional games?
- What are examples of traditional games successfully implementing social functionality?
- ...and what are examples of failures?
- Why implement social functionality? What could it do for a traditional game?
- Do's and don'ts of implementing social functionality in traditional games
- Where is social functionality in traditional games going?
- What traditional publishers/developers are best positioned to take advantage of social functionality?
PS. As of right now the agenda still lists my colleague, David Cole of DFC Intelligence as the moderator, and has me co-presenting a talk later in the day with him. It should say that I am moderating the 10:30 am panel and he's doing the afternoon presentation without me but it hasn't been updated on the Live Gamer site yet.
Monday, March 1, 2010
New Facebook Games Dashboard
Back in January Facebook unveiled plans to launch a new games dashboard where 
"Users will be able to look at their games, see what their friends are playing and see recommended games by the site and publishers." That was not a surprising development given the growth of games on the site.
What is interesting is how Facebook will handle microtransactions for users buying virtual goods that was explained in a recent developer blog. Essentially, users will buy credits to use in games that work across all games. So rather than buy Farmville etc. goods directly from developers, users will pay with Facebook credits bought from Facebook. This virtual currency will be purchased using the same conventional social media buying mechanisms, i.e., credit cards, Paypal or mobile phone billings. Application developers will then received 70 cents of every dollar's worth of goods purchased within their apps.
I don't know what the exchange rate between Facebook credits and dollars will be, but pretend 100 credits costs 1 USD. If I buy a virtual good for 100 credits, the developer will receive 70 cents. Ok, so not rocket science.
Observations:
1) A 70% take is the same rate that iPhone app developers get on sales. I'm curious how Facebook came to their 70% number, though I admit I don't know what kind of take Facebook has been getting all along on app sales. My feeling is that 70% seems like a plausible number if you are happy with how developer payments work on the Apple App store. But Apple and Facebook, are different kinds of companies. Apple characterizes their 30% take of App sales as not a large profit center compared to the rest of its business. Facebook may view its 30% take very differently given the only other real revenue source is advertising.
2) Also mentioned in the developer blog above, Facebook credits will be available in 15 currencies. I'm curious, but will the relative price of those currencies fluctuate with the global currency market? If today $1 US gets me 100 credits, will it be the same price tomorrow if USD suddenly rises hugely against the Euro while simultaneously changing at a different rate against the Yen?
Let's assume once the Facebook Credits price is set in a real currency, it won't change frequently, if at all. Further, assume it stays constant within each of the 15 real currencies. In simpler terms, if a 10 year old kid in the US tells her mom she want $5 worth of Facebook credits for something, and then tomorrow those 500 credits will now cost $6 dollars, I would hope that savvy mom will wrinkle her eyebrow and says "wait a second..."
Going further still, could there be a Facebook type of FOREX market? A virtual currency exchange dealing in actual virtual currencies backed by real currencies...that could make your head spin. I can see it now: "Facebook FOREX for Dummies" ads all over the internet.
The only reason I bring up the multiple currencies point is due to the potential daily volume of sales on Facebook across potentially millions of daily purchasers doing millions of daily transactions. We're not talking about buying/selling of goods on Ebay that require shipping and relatively long processing and travel times. On Facebook it's instant and the boundaries between people in counties are virtually non-existent. Facebook will have to main a kind of firewall between users from different regions that use different currencies who would like to buy in one currency over another depending on the exchange rate. That's wouldn't be hard to do and I can only assume that Facebook is way ahead of me and already prepared to set that up. Again, it's not rocket science. And most people probably don't care too much about trying to find currency arbitrage opportunities via Facebook, much the same way people don't (and can't) on Xbox Live using the increasingly maligned Microsoft Points.
And since Microsoft Point prices don't change often, this table shows the current differences by region based on general exchange rates. Won't these need to change on Facebook since buying credits will probably occur at similar amounts as Microsoft Points.
Finally, what will be the consumer reaction and will it actually increase purchasing? Facebook says it will and also claims it will increase revenues developers net. We'll see.
"Users will be able to look at their games, see what their friends are playing and see recommended games by the site and publishers." That was not a surprising development given the growth of games on the site.What is interesting is how Facebook will handle microtransactions for users buying virtual goods that was explained in a recent developer blog. Essentially, users will buy credits to use in games that work across all games. So rather than buy Farmville etc. goods directly from developers, users will pay with Facebook credits bought from Facebook. This virtual currency will be purchased using the same conventional social media buying mechanisms, i.e., credit cards, Paypal or mobile phone billings. Application developers will then received 70 cents of every dollar's worth of goods purchased within their apps.
I don't know what the exchange rate between Facebook credits and dollars will be, but pretend 100 credits costs 1 USD. If I buy a virtual good for 100 credits, the developer will receive 70 cents. Ok, so not rocket science.
Observations:
1) A 70% take is the same rate that iPhone app developers get on sales. I'm curious how Facebook came to their 70% number, though I admit I don't know what kind of take Facebook has been getting all along on app sales. My feeling is that 70% seems like a plausible number if you are happy with how developer payments work on the Apple App store. But Apple and Facebook, are different kinds of companies. Apple characterizes their 30% take of App sales as not a large profit center compared to the rest of its business. Facebook may view its 30% take very differently given the only other real revenue source is advertising.
2) Also mentioned in the developer blog above, Facebook credits will be available in 15 currencies. I'm curious, but will the relative price of those currencies fluctuate with the global currency market? If today $1 US gets me 100 credits, will it be the same price tomorrow if USD suddenly rises hugely against the Euro while simultaneously changing at a different rate against the Yen?
Let's assume once the Facebook Credits price is set in a real currency, it won't change frequently, if at all. Further, assume it stays constant within each of the 15 real currencies. In simpler terms, if a 10 year old kid in the US tells her mom she want $5 worth of Facebook credits for something, and then tomorrow those 500 credits will now cost $6 dollars, I would hope that savvy mom will wrinkle her eyebrow and says "wait a second..."
Going further still, could there be a Facebook type of FOREX market? A virtual currency exchange dealing in actual virtual currencies backed by real currencies...that could make your head spin. I can see it now: "Facebook FOREX for Dummies" ads all over the internet.
The only reason I bring up the multiple currencies point is due to the potential daily volume of sales on Facebook across potentially millions of daily purchasers doing millions of daily transactions. We're not talking about buying/selling of goods on Ebay that require shipping and relatively long processing and travel times. On Facebook it's instant and the boundaries between people in counties are virtually non-existent. Facebook will have to main a kind of firewall between users from different regions that use different currencies who would like to buy in one currency over another depending on the exchange rate. That's wouldn't be hard to do and I can only assume that Facebook is way ahead of me and already prepared to set that up. Again, it's not rocket science. And most people probably don't care too much about trying to find currency arbitrage opportunities via Facebook, much the same way people don't (and can't) on Xbox Live using the increasingly maligned Microsoft Points.
And since Microsoft Point prices don't change often, this table shows the current differences by region based on general exchange rates. Won't these need to change on Facebook since buying credits will probably occur at similar amounts as Microsoft Points.
Finally, what will be the consumer reaction and will it actually increase purchasing? Facebook says it will and also claims it will increase revenues developers net. We'll see.
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