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December 2000 saw the arrival of a brand new monthly bible for games developers. Staring from the front page, arms folded to emphasise the severity of his message, was Kuju Entertainment’s Ian Baverstock with
a striking claim about the future of games development. His was the first of many faces to grace the cover of Develop.
Last month, Baverstock – now at Tenshi Partners, a firm he founded in 2010 – and five of his fellow cover stars came to London to reflect on what has transpired since that first interview. Nearly 14 years on, the industry is a different place for developers – and certainly very different to the one Baverstock predicted in our inaugural issue.
“In 2000, I said everyone should grow up, get to be bigger and small studios are going to die,” he says. “Now, I think it’s pretty much the opposite – they’re having a great time. They have a wonderful environment to be in, lots of innovation, they can make games for not a lot. We’ve got a proper indie scene.”
David Braben, founder of Frontier Developments, adds: “That comes from the fact that the balance of power has changed. The power has moved from publishing to content creation. We’ve got a lot of services that have democratised the discovery of games, where indies can sit alongside EA.
“The problem is a lot of previous developers haven’t necessarily adapted to it well. And I think that’s part of why we’ve seen the rise of the indies, although most of them are not doing very well financially.”
The power has moved from publishing to content creation. We’ve got a lot of services that have democratised the discovery of games, where indies can sit alongside EA. The problem is a lot of previous developers haven’t necessarily adapted to it well.
David Braben, Frontier Developments
Baverstock suggests that part of the reason some indies are struggling is many newer, smaller developers “don’t want to engage with the customer or with marketing” – yet even if the number of indies decreases, there will still be “far more successful developers than there were”.
Meanwhile, Ninja Theory director Nina Kristensen says that they will have to “grow up and become serious developers if they really want to make it”.
Kristensen also claims that as interesting and valuable as the indie scene is, there’s a far more interesting space emerging between that and big budget development.
“I don’t know that it has a term as such, but I’d call it independent triple-A: genuine triple-A quality, but at a much smaller scale,” she explains, offering seminal PSN title Journey as an example.
“Instead of trying to make a game with shooting, fighting, traversal, vehicles and everything that’s popular, these titles just focus on one specific thing. They’re much shorter games and cheaper to make. And their break-even units is around 250,000, so you don’t have to sell much to start making decent money and you can focus on a very specific audience. I think that’s really exciting.”
The growth of this space has partially been afforded by the new sources of funding that have appeared since 2000, most notably the recent boom in crowdfunding through sites like Kickstarter and Indiegogo. With these in place, developers aren’t beholden to the publishers – or “gatekeepers”, as one expert put it – that controlled whether or not projects were funded ten years ago.
We’re seeing the rise of independent triple-A: much shorter games and cheaper to make. And their break-even units is around 250,000, so you don’t have to sell much to start making decent money and you can focus on a very specific audience. I think that’s really exciting.
Nina Kristensen, Ninja Theory
However, Marvelous AQL Europe CEO Harry Holmwood warns that there is a downside to this: “These new funders are starting to realise just how risky games development is – it’s something we’re starting to see with Kickstarter. A lot of the skill in running a games publisher is knowing when to stop a project, because the magic doesn’t always happen – no matter how good the team is.
“We might start to realise what that gatekeeper sanity check – which was often unwelcome from publishers – was really for and that sometimes it was useful.”
HOBBY CRAFT
Holmwood adds that a lot of the indies and new studios we see aren’t interested in games development purely from a business perspective. Instead, unlike 14 years ago, they’re able to afford to do it for more personal reasons.
“It’s like anything that straddles pleasure and work, that people would do for fun if they weren’t getting paid for it,” he says. “There will always be people wanting to make games even if they’re not making money out of it.
“Look at musicians: anyone can go out and buy a guitar, but they’re not all Noel Gallagher. But a lot of people are making music, playing gigs in pubs. They’re not going to hit the big time, they do it as a hobby. We might see more of a return to games development as a hobby.”
TT Games’ head of production Jonathan Smith agrees: “The tools and the channels of communication for sharing knowledge have evolved so you can now develop games without the massive financial outlay or the investment of becoming a business.”
There will always be people wanting to make games even if they’re not making money out of it. Look at musicians: anyone can go out and buy a guitar, but they’re not all Noel Gallagher.
Harry Holmwood, Marvelous AQL
Holmwood adds: “It’s incredible that you now have Unreal Engine, CryEngine and all these other tools available for practically nothing. Even a few years ago, these would have cost you millions of dollars. It changes the nature of who will go in to making games. Certainly, when I started, computer science was a fairly important part of making games, but now it seems like that’s much less important. You can make a fantastic game and not write a line of code.”
But Braben warns that this depends on the type of game. With so many indies using the same low-price tools, games end up feeling very similar to one another. Instead, studios must focus on differentiating themselves from all the other hobbyists.
Smith suggests that, while computer science and other technological know-how will help, developers’ advantages need not be entirely skills-based: “Great storytellers or great artists will be able to reach a bigger audience. There is an edge in technology – I think there always will be and should be – and I think that’s an edge we as people who are interested in games are excited about, but there are other edges available.”
THE WAY WE WERE
All of the former cover stars present report that their studios are several times larger than they were in 2000. In the case of TT Games, there are roughly six times as many people working there now, although both budgets and operating costs have also increased significantly. There are also new avenues for developers to explore, such as digital updates of previous games and larger, richer projects far beyond what could have been accomplished at the start of the century.
“I think the industry has changed in ways that are really positive from a development point of view,” says Braben. “It’s the publishers for whom the changes have gone in the wrong direction.”
Baverstock adds: “The knowledge of how to make games, the production process and expertise, is much deeper and much wider than it was back then. Couple that with some fantastic technology that’s widely available for a low price and people can make better games more effectively with smaller teams. When you’ve got bigger teams, you can make even better games."
There are also stronger opportunities for games that would not have fared well back when Develop first launched. As one panelist observes, niche games have finally become very profitable.
“As a Japanese publisher, we’re now able to bring some pretty esoteric stuff to console digitally that might sell a few tens of thousands of units,” says Holmwood. “Retail would never have touched those products before, but now we’re able to do that. It means for anyone that’s making something a little bit more off-the-wall, it all becomes feasible.”
I think the industry has changed in ways that are really positive from a development point of view. It’s the publishers for whom the changes have gone in the wrong direction.
David Braben, Frontier Developments
Braben agrees, adding a more remarkable example: “If anyone would have proposed World of Tanks ten years earlier, saying it’s about Second World War tank battles, publishers would have said no, we want space in there, laser guns, cutscenes.”
Baverstock concurs: “Can you imagine going to a publisher with that? Never mind the fact that it’s free, that would have totally freaked them out – just the game concept would have made them show you the door.”
Climax founder Karl Jeffery says that, for all the differences compared to the industry of 2000, today’s games development scene has some noticeable similarities with a more formative period.
“It’s going back to the 8-bit days, when you used to make games on your own: art, code, everything,” he says. “That was an exciting time, especially seeing small indies, hyper-talented individuals who could do all of the development, then go and market the bloody thing and make a fortune.”
But Braben has a less nostalgic view of this era: “In 1982, we were still ruled by publishers – unless you were going to put cassettes in Jiffy bags. Publishers had such narrow views of what a game was. There were rules you had to follow: three lives, an extra life at 10,000 points, ten-minute play time – that was the one that really annoyed me, because it was all based around the arcades.”
Read on for our experts’ thoughts on the changing relationship between publishers, the opportunities of a wider gaming audience and why Minecraft is better for kids than YouTube.
PUBLISHER POWER
Fast-forward to today, and the dynamic between development and publishing has evolved, according to Kristensen.
“Our relationship with publishers is different,” she says. “We’re not reliant on them in the same way because we can support smaller budgets and there are alternative sources of funding that we can utilise.”
Baverstock agrees: “The power of the publishers has been eroded. Even the studios that historically have been much dependent on them have now got other sources of revenue, other routes to market and effectively more power within the ecosystem.
“In 2000, the balance of power between publisher and developer was terrible. But now it’s coming around full circle where content creators have the real power. Them and the distribution platforms, and not the guys in the middle.”
The power of the publishers has been eroded. Even the studios that historically have been much dependent on them have now got other sources of revenue, other routes to market and effectively more power within the ecosystem.
Ian Baverstock, Tenshi Partners
He goes on to predict that studios are likely to develop a genuine knack for marketing. Unlike the aforementioned musicians, devs will have to engage with their audience.
“That means we need more marketing in our creative industry than any of the others,” he says. “And I still think many developers are not very good at that – that’s the weak link.”
Jeffery argues the erosion of publisher power is fundamentally due to the shift towards digital distribution: “With boxes on shelves, someone controls that physical space. Now, it’s about controlling mindshare. Flappy Bird is a good example – if something grabs the imagination of the public, there’s no sort of traditional marketing as such. It’s word of mouth, it’s social media, it just flows. Whether you can engineer that, I don’t know.”
But Smith surmises that fan conversations is actually a form of marketing: “I don’t want to talk to Bryan Cranston to enjoy Breaking Bad – I want to find other people watching Breaking Bad who I can have a conversation with that is relevant culturally. The creators aren’t part of that message, and I think there’s a bigger marketing performance that still has to take place, something that developers can direct, control and lead.”
KNOW YOUR AUDIENCE
Increased consumer interaction with developers highlights another major change: a dramatic expansion of the overall number of people playing games. This has been driven by successes like the Wii and DS, and the rapid growth of the smartphone market.
The result, says Holmwood, is that while developers in 2000 were largely targeting one hardcore audience, today’s studios are faced with two separate demographics.
“One audience cares about games,” he explains. “The other sometimes plays games but actually doesn’t care about them at all. These are the people that make up the 2bn smartphone owners we’re all really excited about targeting. They’re not the people that read Destructoid, download Gone Home and Stanley Parable – even those big breakout successes are relatively small numbers and they mainly appeal to people like us.”
But Braben warns: “That’s a dangerous assumption. True, there is a differentiation between those audiences, but people who read Destructoid and the like so avidly then evangelise the games to their friends, a lot of which are in the other audience.”
Holmwood claims that there is still some lingering arrogance among established developers when it comes to newer platforms and markets: “The mistake that many of us have made is thinking that we know the most about games. There was an attitude a few years ago among console devs that as soon as we start making web games or ‘proper’ mobile games, everyone’s going to prefer those because the others are not real games. And I think we were wrong.
“There’s an unlearning we must go through. As soon as you’re dealing with free-to-play and touch screens, it’s actually a disadvantage to have expertise in building core games.”
For me it boils down to ‘evil free-to-play’, ‘ethical free-to-play’ and what’s in-between. There are ways to do free-to-play where you can give lots of people a great time, and they might put a few quid in the tip jar.
Karl Jeffery, Climax Studios
Kristensen agrees, although adds: “We can bring our knowledge and our values to that space, and I think there’s real value there.”
Inevitably, the conversation turns to free-to-play; a business model that was nowhere near as prevalent at the turn of the millennium as it is now. And all our experts agree that the sector still holds promise.
“Games work well when they’re a hobby,” says Holmwood. “You can play golf for nothing, or spend tens of thousands of dollars a year on it. But everyone is still playing the same game – that’s when free-to-play works well and gets away from that paywall cynicism that we see so much in Western free-to-play.”
Jeffery adds: “For me it boils down to ‘evil free-to-play’, ‘ethical free-to-play’ and what’s in-between. There are ways to do free-to-play where you can give lots of people a great time, and they might put a few quid in the tip jar.”
Braben suggests the industry could devise a way of perhaps warning consumers where titles fit on Jeffery’s scale – or, as Smith calls it, the David Braben Seal of Non-Evilness. But Kristensen is far less concerned with the supposed threat of this market.
“I don’t think the ‘evil’ companies are going to last long because consumers are getting more intelligent,” she says. “The free-to-play companies that are struggling aren’t going to improve until they have much better design and better engagement with players. They’re going to disappear, so I’m not super worried about them at all.”
Smith agrees: “There are vulnerable groups – children are one, but there are others – and I do think we have an obligation collectively to think and care about this. Because if we don’t, other people will for us.”
DEVELOPER PRIDE
Holmwood describes free-to-play as “an inevitability”, rather than a new invention that has “made the industry evil”.
“As soon as something is digitally available, of course prices will come down to the point where zero is the optimal price point,” he says.
But Braben says: “Whether we like it or not, there is a current image in media that games can be very evil and, if you read some publications, are always evil.”
Fortunately, there are examples developers can be proud of – and perhaps they aren’t sharing this as much as they could.
“It’s fantastic that things like Minecraft have become so popular,” says Holmwood. “I love seeing my daughter playing that because I know she’s getting more from it than if she was watching YouTube or TV, or even playing a lot of games. She’s creating something and that’s a really positive thing.”
Baverstock adds: “We should be much more positive about the entertainment hours we bring to the wider population, and let that squash the occasional rant by someone who doesn’t know what they’re talking about. There’s inappropriate content that gets in the wrong hands across entertainment – and that’s true even of books. But it doesn’t stop people talking about how great movies, books or music can be. And we shouldn’t let it stop us from talking about how great games can be.
“We should be talking about that positive message rather being defensive, worrying about kids playing Call of Duty because their parents have let them. It’s not as if we as an industry have encouraged that.”′
It’s fantastic that things like Minecraft have become so popular. I know my daughter is getting more from it than watching YouTube or TV, or even playing a lot of games. She’s creating something and that’s a really positive thing.
Harry Holmwood, Marvelous AQL
WHAT DO YOU THINK?
We asked more notable development figureheads what they thought the single biggest change to the industry has been over the past 14 years.
Fiona Sperry Three Fields Entertainment
"I formed Criterion Games in 2000 and the only route to market was boxed retail products. I spent most of that first year having endless meetings to find a distribution partner for Burnout.
"Flash forward 14 years, and the biggest change? Digital distribution. It’s now possible to self-publish digitally across every viable games platform: from PlayStation and Xbox to Steam to iOS and Google Play. That changes everything.
"It’s exciting for small teams to be able to reach a global audience and to be able to bring the kind of imagination, innovation and creativity that would scare off most of the old fashioned traditional publishers."
Alice Taylor MakieLab
"Mobile has to be the obvious answer, although my brain also ran through MMOs, F2P, Unity, indies and VC funding there. All of those have had a really big impact since 2000. But it’s pretty clear that mobile has changed things in a really massive way, certainly in terms of gamut of customer.
"That said, I don’t think mobile is so available to everyone any more. It’s a ridiculously busy market, and dominated by squillionaires who can purchase Top Ten positioning (Big Fish spend $6m per month to stay in the Top Ten).
"The walls have grown high. There’ll be some crashing. VCs are pulling back. Getting attention is, as ever, immensely hard. The best should forever float to the top though: I look at Fireproof and Vlambeer for that. So inspirational it hurts."
Tony Beckwith Studio Gobo
"I remember in around late 2000, someone in Brighton said to me the games industry would go the way of the TV industry. I’m old enough to remember when there were only three TV channels and yet by 2000, the TV industry had fractured into hundreds of channels thanks to new platforms and business models, satisfying every kind of niche and taste.
"The games industry has been slightly behind TV but a similar fracturing has happened since 2000 and it continues to happen. Video games have fractured into more and more niches, exploring every type of business model and with availability across an increasing number of platforms – I even used to joke we’ll be playing games on the kitchen fridge one day.
"Ultimately, I believe the industry is on a path to ubiquitous gaming, where everyone on the planet games in one form or another."
Ben Murch Rodeo Games
"The rise of digital media. Back in the dark days, the only way to get your game out was to physically place it in the hands of the consumer. The expense made it nigh on impossible for any bedroom coders to do so. Then the internet and – more importantly… ish – Steam came along. Suddenly we didn’t have to leave our homes or wait for the post to get our gaming fix.
"Competitors quickly caught on, and we now find ourselves booting into a cacophony of download services every time we turn our machines on. Devs now have a many ways to release our titles, fixing one problem while creating the issue of an engorged marketplace.
"Both a curse and a blessing, digital media has changed the game forever."
How do you think games development and the industry has changed since Develop first launched? Let us know by commenting below.
