Adam Creighton, Computer and Video Gaming: Austin Game Conference, Day 2

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Adam Creighton, Computer and Video Gaming (Subscribe)

Friday, September 10, 2004

Austin Game Conference, Day 2

It's the second day of the Austin Game Conference (AGC), and it's got the expected day 2 hangover, but it's still pretty interesting.

Don't forget to check out my summary of Day 1.

------------------------------
Highlights
------------------------------

* Voice Acting:
     > I got my demo out to more folks today, including Critical Mass Interactive (Matt and Billy), International Creative Management, Inc. (ICM) (Keith), NCSoft Corp. (David), and Sony Online Entertainment (SOE) (Rich, who I mistakenly called "Rick"). Thanks to these folks for fronting my demo within their companies. Dunno if SOE was really interested, but here's hoping.

* Best Moment:
     > My long chat with Critical Mass Interactive's Matt Scibilia. A prince of a guy, very genuine, and roped me in to a whole creative/technical content consortium opportunity, which I shall call "The Pentaverate". Seriously big things are on the horizon, Folks ... I don't play small ...

* Funniest Moment:
     > My summary of the keynote below. Sorry, as sick as I was, I had to work much harder than normal ...

* News Tidbit
     > In April when Midway Games announced they were buying the Surreal Software, developer for The Suffering, I said it would make sense for Midway to pick up Austin's Inevitable Entertainment, developers of the upcoming Area 51. Last week, Midway announced they'd be opening an Austin studio, and I said it would probably be a zero-sum gain, because I thought that new studio would be the Inevitable purchase. Though Midway recruiting told me yesterday they didn't have any details on the new studio, folks from two companies today, both with relationships with Midway and Inevitable, told me Midway is purchasing Inevitable, and will be staffing 2-3 complete development teams in the expanded office.

------------------------------
Keynote & Session Highlights
------------------------------

Here's a blow-by-blow of the sessions (with commentary :-) .

1) Keynote: "Virtual Property in the Age of Wonder"
     * Presentor: Edward Castronova (Associate Professor of Telecommunications Indiana University)

     * "A touching story about the reunion between a gamer and the young wyvern he was forced to sell during tough financial times in the real world ..."

     * ... I'm kidding. I actually missed this keynote 'cause I was really sick. I'll update the blog once I get the recording. And I recommend not doing a NyQuil/Robitussin CF one-two punch. It's bad. Trust me. And don't steal my wyvern idea. (c) 2004 Adam Creighton.

2) "Selling the Service - Persistent Marketing and Shelfspace"
     * Presentors: Debysue Wolfcale (Sony Online Entertainment; previously with EA/Origin), Dave Swofford (PR Director, NA NCsoft; previously with EA/Origin),
Eugene Evans (Infinite Ventures, Inc.).

     * This was an impressive panel, with the three panelists bringing a combined 36 years of game industry experience, most of it in the MMO space, and even more in the subscriber space.

* SOE made the point that they've chosen to separate the restricted closed beta from the open beta. They treat the latter as presales, with a polished public product.

     > An analogy can be made to online financial services, and their QA & UAT cycles. Maybe FI's UAT cycles should be more like this UAT, and used to upsell the product. Leave it to me to make games industry less sexy by
comparing it to the Financial Industry.

     * There was interesting discussion around in-game rewards for player/user referral system.

     * One audience member asked the very astute question why MMO games aren't marketed in hobby stores (like comic book stores). This is particularly apropos given a title like NCSoft's City of Heroes MMORPG and their comic book tie-in.

          > SOE hinted that they've got some similar tie-ins in the works, and was tight-lipped after that.

          > I think I'll follow up with Dragon's Lair and pitch the idea.

     * Debbysue is one of the coolest names/spellings I hadn't seen before ...

3) "Games in Hollywood"
     * Presentor: Keith Boesky (International Creative Management, Inc.)

     * As the former president of Eidos, Boesky is the guy to be
credited with turning Tomb Raider into a franchise. Ex-prez, former
lawyer, currently with ICM and self-billed "Hollywood asshole". Boesky was wonderfully sarcastic, impressively sharp, and had great content comparing the game industry to the film industry, and what works (and doesn't).

     * Much more investment in game development than making a movie.
          > There's no "option" equivalent for games.

     * Myth: Games are not bigger than film. Dollar-wise, yes, but not per unit. Games at $50 per unit, versus ~$10 for tickets.
          > So? Isn't the total dollar amount what matters, not the average per sku?
          > The games industry has been growing at 18% compounded, compared to 2-3% in the film industry.

     * Target movie audience is 14-18 year-old women; not the same demographic as gamers.

     * In the game industry, we're shooting ourselves in the foot being single delivery via a game. Compare this to the film industry, where they never make money on the box office, but do on merchandising, pay-per-view, DVD,
etc.

          > There are probably only 30 titles that have boken over the 1 million unit barrier.

          > As the production costs rise, the break-even point is expected to be 3-5 million units in the next gen market. It will take a while for the next versions of consoles to reach that many units.

     * "Design does not save film" (film is all about the story). However, story
will not necessarily kill a game, but it can make good game more compelling. (Bad gameplay can kill a game.)

     * The $19.99 price point can see sales rise 8-fold over the $49.99 price point. Sega are trying this with the ESPN NFL and NHL franchises.

     * Boesky mentioned the idea of game development going to the film model, where sub contractors are used for production, then let go.

          > As I've mentioned before, this is the model used by Wideload Games in Chicago.

     * I put Boesky off when I talked to him about Midway being able to save money by casting locally for games like Area 51, developed by Austin-based Inevitable Entertainment. He pointedly remarked that ICM brokered the Duchovney/Madsen/etc. connection. Whoops.

     * I gave Boesky a voice demo. Hopefully he doesn't chuck it.

4) Customer Service -- In-House or Outsourced?"
     * Presentors: Billy Cain (VP Of Development, Critical Mass Interactive),
Matt Scibilia (President/CEO, Critical Mass Interactive, Inc.).

     * Two of the scheduled presentors weren't able to attend. The Critical Mass Interactive guys roped in Mike Daubert (CEO/Studio Director, The Animation Farm), and the three talked about issues around content and asset off-shoring. Though it wasn't around support outsourcing issues, it was really interesting stuff, and a lot of it was applicable to almost any vertical market.

     * Costs and size of games for the next gen iteration are tripling (with 10 times the assets), ensuring "there is no way the things are going to be completed on-site."

          > Panelists didn't seem to think the "Hollywood model" applied to game development would be successful for any but the largest publishers (Electronic Arts, etc.). Smaller developers need to plan solidly for building global infrastructures and teams. Panelists were very positive on the benefits of well-planned off-shoring.

     * Scibilia made a good point in response to questions about the downside to off-shoring: "Outsourcing overseas has been happening for centuries. This country was built on outsourcing overseas."

     * As a generalization, the offshore markets are good labor resources, but somewhat lack in the design, aesthetics, and self-direction aspects. This is due to a number of factors, not least of which are cultural, language, and skill-level areas.

     * Costs of off-shoring include loss of one or more days of work per month, the need for more intense monitoring of the development pipeline, the complexity of the process.

     * Off-shore labor markets to consider in addition to India (in order of panelist preference) include South Africa, Eastern Europe, and Singapore.

     * Companies like Critical Mass Entertainment and The Animation Farm do all of the off-shoring due diligence (research, relationship building, international legal, contracting, etc.) and the process management, so companies that pick them for vendors don't have to worry about that effort. Off-shoring requires heavy process, a dedicated off-shoring project manager. (As an aside, Critical Mass seems to have a very solid pipilone and process management methodology.)

     * The mentality for off-shoring should be a co-development, and co-operative.
          > You're saving money, and realizing more profit.
          > Off-shore companies are growing their skills and experience.

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SOURCES: Gamespot.com, joystiq.com, kotaku.com, Xbox.com, IGN, GameInformer, Official XBox Magazine, CNN, gamesindustry.biz, and others.

Adam Creighton, Computer and Video Gaming (Subscribe)

Friday, September 10, 2004

Austin Game Conference, Day 2

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