It’s a fascinating time to observe the games industry, particularly in terms of innovation. The console cycle nears its peak.
Traditional publishers are refocusing budgets towards smaller portfolios of established franchises and proven IP and away from high-risk new IP. Contrastingly, online games companies are thriving, rapidly growing user bases, maintaining continuous pipelines and experimenting with new IP.
Where their offline colleagues are becoming risk averse, online companies are riding a wave of commercial and technical innovation. Developments in technology and online distribution have combined with revolutions in commercial models to allow a new generation of developers to create games and get them to market for costs that have not been seen since the 1980s. That time was a golden age of innovation in terms of genre, gameplay and technology. I believe we are in a new golden era for games today, and we see most of the dramatic innovations in the online world; but just how innovative are today’s online companies and why?
First, the risk profile for online companies is fundamentally different.
Triple-A in the console world means huge teams, eight-figure budgets, unprecedented complexity in production, massive and protracted investment in technology, a value chain that leaves little for independents, and mounting risk for everyone involved.
Triple-A in the online world is harder to tie down as it changes with platforms, genre and consumer. Technology is focused on customer management over engines. Production is continuous, not project-by-project. Online games involve constant maintenance, but the value chain is shorter and more generous, giving rise to developers that are often publishers.
Online games, which grossed $10bn in 2008, are experiencing a pace and breadth of innovation that outstrip offline colleagues. Companies are finding unprecedentedly profitable ways to drive revenues online and we have written frequently about online gaming’s high levels of commercial innovation. We see significant technical innovation in companies finding new ways to create and deliver compelling content, and to understand and enable consumers to play with others. But there is still massive potential for creative innovation.
Revolutions in gameplay are relatively rare in the overall industry, but most successful online games are not breaking new ground in core gameplay. Runaway success Travian is fundamentally a heartstoppingly-slow real-time strategy game. Gameforge’s OGame or Bigpoint’s Seafight have their origins (and graphics) in games over a decade old. Most casual games’ arguably date back 15 to 20 years. Zynga or Playfish’s pet games rely on Tamagotchi ideas. Most hardcore MMOs (including World of Warcraft) feature core play unchanged since Ultima and Wizardry.
Perhaps it’s a question of evolution, not revolution, particularly in the behaviour online games induce in players. Travian’s gameplay and timed services encourage truly novel collaboration between players. Gifting, item auctions and limited edition collectible items are introducing some strange and interesting behaviour amongst social network gamers. The complex political alliances between clans in casual MMOs can result in unforeseen outcomes. To keep pace with their users’ changing behaviour, these games must evolve as rapidly, never really hard-launching anything, running live betas for months, constantly experimenting and refreshing their games with new content. Eventually, incremental improvement will generate new games species, but the radical steps involved in the creation of truly new genres are harder to uncover.
So where are the new genres? You have to look to the boundaries of the industry to find games that are challenging the definition of what a game is. iPhone and Facebook’s burgeoning App developers have conjured successful, revenue-generative games out of thin air from subjects bizarre and diverse. Some look across the range of games based on user-customisable physics engines and argue that they have evolved a new genre. Perhaps the keys may be in the hands of non-professionals given the chance to innovate with the simple game building tools of YoYo’s Game Maker or Flash. Whatever your opinion, it’s been a long time since new formats could be made and distributed to a mass market so cheaply or democratically.
Surely we should look to our veterans for such fundamental innovation? The 1980s and 1990s saw new genres arise, frequently from the UK’s independents.
That era’s teams still form the backbone of today’s studio sector, but traditional UK independents – the economics of whose business are becoming harder to sustain – are moving online slowly and in surprisingly low numbers. Many are ignoring the opportunity to return to their game-changing roots, while the costs are still bearable and routes to market are manifold. These lower barriers to entry mean that online has higher innovation potential and is crying out for the outstanding creative, technical and design skills found in abundance amongst independents. The question, perhaps challenge, is this: will you follow the likes of Realtime Worlds, Sports Interactive and Monumental into this brave, if often over-hyped, new world and create the next wave of new games genres?