All the noise surrounding the next-generation of consoles is a fantastic opportunity for investors to make big money from gaming.
That's the opinion of Kristian Segerstrale, former executive VP of EA's digital business and current investment specialist.
The next generation consoles are doing a wonderful job at distracting the big publishers away from the fastest growing parts of the game industry,” he wrote on TechCrunch. That clears the water for pure digital plays to gradually build up dominance with new IP on new hardware platforms.
Activision Blizzard CEO Bobby Kotick's recent dismissive remarks about mobile, and EA's strategy of ANDs: consoles and PC and mobile and online (which dilutes their excellent talent across too many opportunities) are cases in point.
The innovators' dilemma confronting the big guys is creating continuing unopposed growth opportunity for new and established digital pure plays alike. That is giving new players time to build up the brand and marketing advantages that big publishers have held for years on what are rapidly becoming legacy platforms.”
Segerstrale also questioned the viability of publishers in the new world of gaming.
As the digital market has matured, player acquisition, telemetry, cross-promotion and other marketing services have become widely available as independent specialist services that compete on price and quality of the service,” he wrote.
Doing it directly is not just cheaper and more flexible as the world changes, it also forces a more profound understanding of player flows and distribution challenges, which ultimately helps uncover product design insights.
Much has been made out of the advantage that big game publishers have in terms of access to Apple or Google in terms of promotions. However that success is short-lived if you are unable to retain your audience and acquire users independently at a profitable cost of acquisition. A game investor worth their salt will be able to make the right introductions here anyway. The incremental publisher value here is small.”