Can Halo effect lift the market?

It has been a difficult period for the UK games market.

Toys R Us, Argos and HMV have all blamed the ‘weak’ games sector for a tough summer of sales, while last week the UK games market suffered its worst seven days of sales since May 2006 – before the launch of Wii and PS3.

But industry execs are bullish that there is a turnaround on the cards. The arrival of Halo: Reach yesterday effectively kick started the Christmas new release rush, with PlayStation Move arriving this Friday.

It is an indication of the scale and importance of the games business overall that a downturn can have a real impact on so many retailers,” director general of the Entertainment Retailers Association Kim Bayley told MCV.

It is no secret that 2010 has been a challenging year for games, but we are now seeing some exciting new releases coming through and retailers are throwing their weight behind them, giving cause for optimism for the final quarter.”

Chart-Track director Dorian Bloch also feels the slow sales last week may have been down to consumers waiting for the arrival of Microsoft’s epic FPS.

Last week’s sales were really low, but people may have been waiting for Halo: Reach,” he told MCV.

Halo: Reach should be the springboard that takes us into Q4, even though we are still in September. Of course, we will soon know how much pent-up demand there was for Reach, as we gear up for records.

I’d say that this year’s line-up is stronger than the one we had last year. As well as the usual FIFA, PES, Call of Duty and Need For Speed games, we have The Sims 3 on console, Medal of Honor relaunch, Fallout New Vegas, Fable III, Assassin’s Creed: Brotherhood, Gran Turismo 5, and that’s not to mention Kinect or Move.”

TRIPLE-A OR BUST?
It is easy to cite a lack of releases as the reason for a market blip. But the first half of 2010 was filled with big new titles, from BioShock 2 and Final Fantasy XIII to Splinter Cell and Red Dead Redemption, and the market was still down.

Some Research and GameVision CEO Sean Dromgoole believes there’s a more fundamental change as to why the market has fallen.

The market is moving much more towards the tentpole structure, where you have these enormous releases that are doing as well as ever, if not better,” he said.

Fantastic releases like Halo and Call of Duty last year are bigger than blockbuster movies. On the other side, we have this hugely active punk section of the market at the bottom – such as Doodle Jump on iPhone, and other low-calibre titles on PC, or on PlayStation with Minis. And there will be hits that come out of that, but never as big as the enormous blockbuster titles.

What has been trashed are the games that fall in between those two things. You used to be able to flog a single-A title or a weaker title in a popular genre – such as racing and shooters. Those games are now really, really struggling.

You either need to make a triple-A or keep it simple at a low cost. And that is really scary because it never used to be like that. It doesn’t get there tomorrow, but that is where the games market ends up within the next two years. It is becoming a polarised market.”

END OF A CYCLE
The last time the market was this low was in 2006. Back then Xbox 360 was just out of nappies, and PS3 and Wii were still well over six months away.

It was at the end of a console generation. So could the drop in sales be just as much down to consumer fatigue than anything else? It could well be. But Xbox’s UK and Ireland general manager Neil Thompson believes Halo, Move, Kinect and so on will spark a ‘regeneration’ for the UK games industry and shift momentum back in our favour.

There’s transition going on,” he told MCV.

Over the last year, we are moving from more traditional console experiences and over the next two, three months we are going to see a whole new breadth of experiences.

I think Halo: Reach is a great new start to that regeneration. And Kinect will take us further. I am very bullish about what the gaming industry will be over the next six to 12 months and Reach kicked that off in a big way.

It is a major franchise that will have a big impact on the market and generate a lot of momentum for the industry.

It is the most successful games franchise in history,” he added. Big, massive, fantastic, enormous, record-breaking, every adjective you might want to use around the biggest franchise in the world. This Halo has had more love, care, sweat, tears and resource poured into it than any other.”