Dr Mike Capps played bass in a local thrash metal band in his younger years. The shoulder-length hair has now deserted him, though the goatee still comes and goes. The angst, if it ever existed, has long gone. Capps appears unfazed by the intense levels of expectation placed upon him, and talks in a confident, calm, considered manner.
It’s important to know Capps (pictured) isn’t as mad as a box of frogs because, recently, he made a gutsy call that could paint him as such.
Epic Games is now stretching its resources and working on five separate game projects across consoles, mobiles, digital channels and PC. The post-recession games industry tends to freeze at the idea of taking such risks, but Capps is holding faith in the experienced talent that surrounds him.
In fact, he’s giving some staff the same opportunity Cliff Bleszinski was given before the Gears of War phenomenon – he’s allowing people to lead projects for the first time.
In the interview with Develop below – the first in a two-part Q&A – Capps explores Epic’s studio strategy, as well as his hope that some senior staff will thrive in the spotlight.
Epic Games is working on five new projects. Tell us more.
One of the reasons I announced we’re doing five projects is because we’re always hiring, and we want to break the perception that we’re the Gears of War folks. We’re want all sorts of creative people.
Is being based in North Carolina one of the main hurdles for hiring, because obviously it’s not part of a development cluster like, say, California or Washington.
Yeah it is a hurdle. Folks who come here do like North Carolina, it’s quite cosmopolitan and yet pretty easy to buy a house, and our studio has lots of space for development. Everyone at Epic has a windowed office so it’s not that sort of cubicle environment you sometimes get at other places.
So when we’re actually interviewing people from places like Los Angeles they tend to be pretty happy about the place, but actually getting the best people for interviews is the tough part.
It’s hard to sell North Carolina to the 20 year-old developer who loves the rave scene! People think it’s all pick-up trucks and guns here. I remember we interviewed someone from the UK over the summer when it was 37 degrees here, and they were like “I’m dying here!”
You must be stretching your resources with five game projects and Unreal Engine 4.
Yeah, and we’re still working on updating Unreal Engine 3, as well as more stuff with UDK.
I think key to this is the average person at Epic has been in the industry for ten years. That’s the average, so we’ve got some really experienced developers working here. We’ve got guys who anywhere else they’d be the art director or the lead producer and they just didn’t have that opportunity with us. So, basically I’m going to give them a chance. We’re taking some really senior folks and say, well, it’s your project now, see how you do.
I’m sure those people are relishing the opportunity.
Yeah I’m looking forward to being really surprised by what people come up with, and so far I have been. It’s interesting, we have some people who are fierce lovers of Gears of War, and there are other people that think "ten years of Gears, please god let me do something else". So that’s why I think people love it when they get the chance to work on Infinity Blade or BulletStorm.
The commercial success of Infinity Blade must have changed the company’s direction somewhat. If you make that much money you can’t ignore it.
The question for us is, was that a fluke? We built something that was triple-A on a platform that didn’t have a lot of product like that. I hope there’s a lot of opportunity for that for Infinity Blade 2.
But you have somewhat created a brand for that audience. You’re the Infinity Blade studio.
Yeah absolutely. It’s funny because we’re seen as the people behind Unreal and Gears of War and we’re something else to the mobile community; people who probably don’t even know what Unreal or Gears is.
I take it you’re still not investor funded, even when expanding to five separate projects and two engines?
Oh no. God no. We’ve been lucky to be able to run from revenue since day one.
Double-A games are dead.
Yes they are.
And triple-A games have become so hit-driven that millions of sales are needed to return a profit.
For the medium itself – is this a good thing? Is it good that the biggest and perhaps best survive?
No, no I don’t think so at all. Certainly as a gamer I don’t think what’s going on is a good thing. Triple-A is as much about marketing these days as it is about production values.
Take a game like BulletStorm, for example. That game was supported and well reviewed but just didn’t break out. It wasn’t a failure, but it wasn’t a success that could fund a series of projects either. That’s a game that I think people loved but it’s not one that gets the $100 million marketing budget, because that amount of money is only spent on a few sure-fire hits and annualised sequels.
If you look at the movie business, as an analogy, if you can make twenty movies that can make roughly $50-100 million, if three or four are giant hits that will pay for the other ones. Problem is, people can’t afford to make a single movie or game of that cost.
That’s too bad. There’s a lot of great games out there that don’t take off. How many games have you loved that sell less than three million units? There’s probably dozens. Those games can’t get made in today’s games economy. So no, I don’t think it’s a good thing that the middle-class of games have gone away.
In terms of marketing spend for the big triple-A games, is this spiralling out of control? I hear about $50 million projects budgets that are doubled through advertising spend.
Yes I hear similar things, though sometimes you hear about the ratio being 2:1 either way. It depends a lot on the situation. I’m not an expert here, but there is a huge impact from non-commercial marketing these days with things like Facebook and Twitter. If you don’t spam people then you can be very useful to your customers. We were not forward-thinking in that area, but we’re really driving in this space now and have more than one million Facebook fans.
So the point being, marketing budget is crucial to success. I don’t like that, but it’s a fact. I’d rather sales be directly proportional to quality.
But other forms of marketing and PR are starting to change things. The focus is changing from shoving TV ads in people’s faces to actually building a community.
I don’t know if there will be the same amount of TV adverts in five years’ time. No one gets fired for buying TV ads, because they make sense, but soon they will start to make less and less sense. I think what could happen is a lot of money can be saved with less TV adverts and that itself, perhaps, could free up more money to take more risks and be more creative.
Either way, I think the 1:1 marketing spend is going away. Then again, as things are going, I think the large triple-A development budgets are going away as well.
Epic has released new IP for console, for XBLA and for mobile. What lessons did you learn from this?
In terms of getting attention, I would say we need three different approaches for each one. But I’m not sure we got the right strategy all the time.
Looking at the new triple-A IP that’s come out this generation, it’s a shockingly small list. Breaking through all the noise is incredibly hard, even if you have Cliffy B on stage promoting a game. So I would say, with triple-A, you need a strong brand and very well prepared strategy for breaking through. I’m not sure we did with BulletStorm, though. The hardcore circles loved it, but we didn’t get many other people.
With Shadow Complex, we took a traditional route. Our strategy was the same as Gears but on a smaller scale. So we still ensured the game had an E3 presence on stage, and made sure the journalists could come out and play it. But I’m not sure how well that strategy worked. We did break sales records at the time, but we didn’t sell tons and tons of units. It wasn’t super successful. When you look at the way indies make noise about their game before release, I think there is a lot we can learn from them.
I mean, we partnered with Microsoft on Shadow Complex, and I don’t think they yet have a playbook for marketing XBLA games differently to traditional retail games. That’s not to fault them; we don’t have that strategy either – it’s a brand new space. But because it was triple-A, and at a higher price-point, we thought it was best to advertise it the same way. If I’d do it again I’d probably ask for a different route.
With Infinity Blade, I think the trick is to get Apple to promote your game on stage! [laughs] Oh, and in their commercials. We didn’t spend a penny on Infinity Blade marketing. We were thinking about it but never got round to it. It’s been a very profitable game for us.
We’re learning, we’re experimenting with the project, looking at things like microtransactions and piracy. So I wish we had a playbook for marketing our iOS games, but really it was Apple that’s really carried the sales. I have no idea how much they spent on advertising Infinity Blade when it came out, but the game was everywhere. That was the first time my mum actually saw an advert for one of our games.
I think your own internal strategy represents changes to the industry itself; you’re building iOS games, console, PC and digital games. It’s quite the diversified strategy and it represents the rapid changes across the medium. What would you say to studios that aren’t spreading their bets the same way?
Well, firstly, you make a very good point. And we may not be leading the way in diversifying, but I do think the changes we’ve made are representative of what’s happening in the industry.
So, this is going to sound strange, but my advice is: If you’re just starting up, don’t diversify. If you’re going to win in the iPhone space, I’m not sure making ten games is the best strategy. Build something you believe in until it’s perfect.
We over-spent on Gears of War 3 because we had to. The quality of the game had to be our calling-card. Of course, now we’re pushing hard and over-spending on three different types of platform, but that’s only something you can do with twenty years in the business and a company you’ve built up over those years. A start-up needs to just focus on making sure one game is flawless. If the company doesn’t last, if the game doesn’t last, at least you’ll have something great on your CV.
The average game on the App Store only makes something like $300. Spreading your bets doesn’t work.