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Death to the Game Industry

Death to the Game Industry

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TOUCHINGTOUCHING AIMEE’SAIMEE’S PANTIES:PANTIES: TheThe RealityReality ofof VirtualVirtual CommerceCommerce byby MarkMark WallaceWallace Wait. What was that? To the editor: I just wanted to drop you guys a quick word to let you know what Yes, we have found the one sector of the a fantastic job I think your doing with economy that is, apparently, outside the the magazine. I’ve been consistently I wanted the so desperately. I influence of inflation. Either that, or impressed with the content found inside knew I’d have to play my cards right in perhaps there’s more to the economics To the editor: I just finished reading your virtual pages and look forward to the weeks leading up to Christmas to be of gaming than box price. today’s issue; it’s the usual engrossing downloading a new PDF file every sure I’d get it. I got along famously with and thoughtful material. Tuesday. my brother. I kept my room tidy. I gave This issue of The Escapist, “Dungeons the dog baths. And then the moment of and Dollars,” allows our writers to I just found it interesting that your Which brings me to another point I’d like truth ... Christmas morning the tell-tale explore the various aspects of the articles either introduce me to something to make: I absolutely love the formatting package shape was there, under the economics of . that I’ve never had any contact with and of your publication! I know that tree, among the other gifts. speaks to the serious issues facing the make me want to know more about it, or everyone’s tastes differ, but it struck me development community presented by they put a new spin on subjects I’m as a shame to consistently see some My brother and I pounced upon it the current structure of the production familiar with and usually follow. Not complain about the formatting of your immediately. And there it was. Dragon process. Mark Wallace delves into virtual going wow yet? mag - there are surely many of us who Warrior II, the most anticipated game commerce and why virtual is perhaps not enjoy it as it is. In a way, downloading for the NES that season – at least it was the best term to describe it. Enjoy these Well, the point is, to me, it’s the next the PDF for me actually makes it feel for my brother and me. And it was one articles and more in this week’s issue of step in the evolution of gaming. We’ve MORE than just a web page, you know? of the most expensive at around $50. The Escapist. had PC and magazines that tell That was why it was not guaranteed to us what games to buy for a very long -Benoit Casey be under the tree, as back in 1990, $50 Cheers, time ... but now we have a magazine was a lot of money, especially for what that analyzes games and informs us of To the editor: Hi, I recently discovered was widely perceived as a child’s toy. issues we should, as intelligent members your magazine and continue to be of the community, know. It’s a step that impressed and inspired by the ideas Now, 15 years later, another hotly I think may come into incredible fruition, therein. That much you must hear all the anticipated title hits the shelf for though I can’t ponder what that fruition time, though, so that’s not why I’m Christmas – Peter Molyneux’s Fable. It’s may be. writing. debut price? $49.99. -Sean Li I just had to beg, in response to some Reading your magazine is like a taking in but one of the things I like about your I enjoyed the article, it certainly brought other recent letters sent your way, that a fresh breath of pure oxygen for me - magazine is that it has a nice format. me back - as for the link between Halo you not change the layout. The world the opinions are close to mine, the T’would be nice to have a font size and Marathon, I can only say that does /not/ need another Slashdot. Any layout is not teenager-friendly with option which makes the font bigger and anything more than a causal link would site can have unique writing, but unless garish colors and type (I work in an reformats the sheet. have been rather difficult since there there’s something special about the Information Agency, and all my were only a few people on earth who presentation, most people won’t see any designers who’ve spent 7 years studying -Cezanne Farris-Gilbert knew the story well enough to keep the reason to stick around. typography and art love the layout too), tie-ins accurate. Hamish, myself, and the stories are on refreshing topics, and To the editor: As one of the people maybe a few other people - none of The pictures don’t tell half the story, but the content is insightful to say the least. involved with making all those cryptic whom worked at Bungie by the time they are the reason I gave The Escapist Brilliant! story messages and all that. I can only even Myth was in production. a second glance. say that you stated almost exactly in And I know you probably don’t take your article what our intentions were -gk -KSaigo requests, but it would be great to see an when we created the games - that is a article on the Fallout games - I’m sure game that had a story and that we liked To the editor: This is just another rant there are a lot of fans out there who’d to play. on how good you guys are... (you love you for it, and it would be probably get a lot of these, but here’s interesting to read your opinion in any At the time, we told the story via mine anyway) case. terminals because we simply didn’t have the resources (computer or manpower) I play a lot of games, and have been for Please keep up the good work, and know to do anything else. I think the success more than a decade now - which is that you have a person who’s willing to of the terminals was due simply to its somewhat of an unusual hobby here in work for you (free of charge) in India in incredible limitations. We were forced to India where gaming is just taking off. case you want a perspective on the tell a story in sets of 3 paragraphs. Most of the fellow ‘’ I know have gaming scene here. started off with Counterstrike, and have All the other crazy stuff came from that. no clue about the brilliant classics like -Zubin Nowadays, games can do anything that Planescape Torment, the series, can be done in a full length film. Would Fallout 1 & 2, Castlevania, Street To the editor: I enjoy your online mag, anyone still read a terminal in a game if Fighter, Test Drive and, of course, but when the fonts are resized by force, it was there? Wrecking Crew, to name but a few :) it loses it’s formatting. Not a big deal, “The machinery of gaming has run amok... An industry that was once the most innovative and exciting artistic field on the planet has become a morass of drudgery and imitation... It is time for revolution!”

–”Designer X” in the Scratchware Manifesto

When “Designer X” wrote those words back in 2000, the industry, to the degree that it took any note whatsoever, dismissed them as irrelevant ravings. Jessica Mulligan wrote that the Scratchware Manifesto was “naïve in the extreme,” and obviously written by an industry outsider - and was quite surprised to learn that I was Designer X. Of course, things have only gotten worse since 2000, and the industry - or at least, developers - have started to agree.

Two years ago, speaking at a conference in the UK, said “The publishers have to die, or we are all doomed” - to cheers. And this year, at GDC, I ranted on the problem - and received a standing ovation.

What is the problem? And is there any way to address it? As recently as 1992, the typical doing so became mandatory. You had to development budget for a PC game was generate enough assets to fill the disc. as little as $200,000. Today, if you want a title that will be taken seriously by the Today, art assets (not programming) are retailers - an A- title - your the main cost . As machines minimum buy-in is $5m, and $10m for a become capable of rendering more triple-A title is common. With the next detailed 3D models in real time, the generation of console hardware, the talk market demands more detailed 3D is of $20m budgets - not as something models - and models are hand-created that will be unusual, but typical. by artists using tools such as 3D Studio Max and Maya. All things being equal, a On a theoretical basis, the rise in doubling in polygon count means a development costs is driven directly by doubling in the amount of time an artist Moore’s Law. As hardware becomes needs to spend generating the model - capable of displaying better-detailed and a doubling in cost. Faster machines graphics and higher polygon counts, it can push more polygons; more polygons becomes mandatory to provide them. If means more cost. you do not, your competitors will - and your games will look inferior by That’s the theory, but empirical evidence comparison to directly competitive bears it out. Back in the day, a Doom product. In the accompanying graph, level took one man-day to build. A Doom M M M M M M you’ll see a huge rise in the ‘90s; that III level takes two or more man-weeks. was driven by the adoption of CD-ROMs. Before CD-ROMs became common, Now one might argue, of course, that the games had to be delivered on floppies - improvement in graphical quality and even if you did a game with several improves the experience so floppies in the box, your application size much that the cost is worthwhile. But if was still measured in single-digit that’s so, why was Doom so rapturously megabytes. CD-ROMs provide more than received, such a huge hit? And why do 600 MB - and once you had the the critics basically agree that Doom III - capability of providing that much data, well, it kind of sucks? It’s not the glitz. It’s the gameplay. partly to blame: Indie rock fans may prefer somewhat muddy sound over In principle, increasing processing power some lushly-orchestrated, producer- also allows better development tools, massaged score; indie film fans may which helps speed the process. But the prefer quirky, low-budget titles over big- reality is that it ameliorates, not solves, budget special FX extravaganzas; but in the problem. The tools don’t get better gaming, we have no indie aesthetic, no fast enough. Middleware doesn’t solve group of people (of any size at least) the problem, either - you might get a who prize independent vision and product to market faster by licensing the creativity over production values. Unreal engine, say, than by building your own 3D renderer from scratch - but But the nature of the market and you’re still faced with building all the distribution channel is even more to content. And the case for buying blame. When a developer goes to a middleware is rarely open and shut; publisher to pitch a title, the publisher each engine is designed for specific does not greenlight it because they play purposes, and if you want to do a game it and say “what a great game!” The that differs a lot from what the code was developer may not even have a playable written to support, you find yourself demo - but what he will have is a demo spending a lot of programming time reel, a non-interactive visual pitch that trying to solve the problems. Spector may work to get some sense of says he’s not at all sure that the gameplay across, but is mainly designed development of Deus Ex actually to impress the marketing dweebs with benefited from using Unreal - after all, the graphics. Glitz, not gameplay, is Unreal was built as an FPS engine, and what sells the publisher. Deus Ex was an FPS/RPG hybrid. They The problem is that once something had to rewrite a lot of code. For that matter, half of the people sitting in on that greenlight meeting are becomes technically feasible, the Glitz Over Gameplay probably marketing suits who think The problem is that once something they’re in a packaged goods industry, market demands it. becomes technically feasible, the market and are a lot more concerned about demands it. Gamers themselves are branding than anything else. Sequels and licenses, good; creativity - that’s too In other words, graphic glitz is the first The Narrowness of the Retail risky. barrier you must surmount. If you don’t Channel have it, you won’t get greenlit; if you Step into a typical record store - even a And glitz, not gameplay, is what sells the don’t have it, you won’t get distribution. small mall location - and there will be retailer. Retailers don’t have the time to Maybe, someday, way down the road, thousands, possibly tens of thousands, play every title that comes across their the actual quality of the game will of different titles in the racks. Step into a desk and, in many cases, they don’t play matter to someone - a reviewer, an typical bookstore, and the story is the games anyway. They look at a video, actual gamer - but you don’t even get a same. Step into a typical game store - they look at the materials provided by chance to get to them if you don’t have and you will be lucky to find 200 titles. the sales guy, they make a decision. And the graphic right stuff. In other words, that decision is ultimately based on gameplay may affect ultimate sales - but In film and publishing, plenty of people concerns like branding, how much it won’t get you shelf space. make decent, middle class livings by money the publisher will spend on catering to niche audiences - they’re not product placement and stocking fees The reverse isn’t true, though - poor going to get rich, they’ll never make as (what the industry calls “market gameplay and great graphics will work much as Stephen King or 50 Cent, but development funding,” or MDFs) - and just fine, as far as the market is they reach a market. And in both whether it looks pretty or not. concerned. 80% of all game sales occur industries, a product has time to build in the first two weeks that a game is word of mouth and an audience - several And finally, there’s the industry’s available; all you need to do is blow months, typically, before either music or attachment to “feature list” marketing. through your inventory before word of hardcover books get returned (and even Online play? Check. Dozens of levels? mouth catches up with you. The industry six weeks for paperbacks). Check. HDTV support? Check. You can is full of best-selling, lousy games. Can often tell a game has nothing new to you say “Driver 3?” I knew you could. In the games industry, you get one shot. offer just by reading the backcover text: You have two weeks. If you haven’t If it’s basically a list of features and In other words: Pretty + bad = achieved sales velocity, you are dead. numbers (five of this and a hundred of financially successful; good + not pretty It’s the bargain bin for you, buster. that), you know they’ve really got = fuhggedaboutit. Of course, pretty + Thousands of games get released each nothing to say. good would be nice - but neither the year, they only have facings for 200, and publishers nor the retailers have an they need the shelf-space for the next incentive to care. piece of over-hyped crap. I want you to think about this, a little bit. These days, almost nobody over 35 Dozens of people have worked for, plays games. In other words, a much typically, three years to bring a game larger percentage of the population as a to fruition - and two weeks is all they whole plays games. get. Compressed sales is vital to staying on the shelves, 80% of all sales are in Not because more people have become the first two weeks - and if the publisher gamers, exactly - rather, because has botched the marketing, it doesn’t people’s leisure time activities tend to be matter how good the game is. set in their teenage years, and they pursue the same activities as they get Oh, by the way... Go buy yourself a copy older. Thirty-five year-olds play games of Freedom Force vs. The Third Reich. If because they’ve been playing them since you can find it. Nice game. Too bad they were teens. Fifteen years from now,  K K K K K about the marketing. 50 will be the cut-off - and 30 years from now, the demographics of game players But Sales are Up! will match the demographics of the Yes, they are; the games industry is the population as a whole. (And, by the way, fastest-growing entertainment industry we won’t have idiot senators attacking on the globe and unit sales increase year games any more - everyone, regardless by year. There was a time that a million- of age, will know how dumb that is.) seller was considered extraordinary, and now there are several every year. And if So the growth in game sales is driven by you believe, say, Michael Pachter at two factors: The growing portion of the Wedbush Morgan, we can anticipate population that was exposed to games soaring growth for decades to come; when young - and, of course, the growth surely all is for the best, in this best of of the population. But what we’re talking all possible worlds? about, when you get down to it, is growth on the order of 7-10% annually. Why is it that sales are up? The answer is very simple: Demography. Fifteen Compare that to Moore’s Law: 100% years ago, almost nobody over 20 (and growth in processing power over 18 almost nobody not male) played games. months. In other words, the growth in processing In other words: There is no room in to diversify, to invest in a lot of different make money off the bets of others via power, which drives the cost of game this industry for niche product. There financial vehicles with different risk the platform royalty. development, is enormously faster than is no room for creativity or quirky vision. profiles. the growth in the population of gamers - It’s hit big, or don’t try. EA is stable for a different reason: It is and while technically both are Similarly, being a small publisher is like big. More than double the revenues of exponential curves (at least until the Implications for Publishers making a high-stakes, low odds gamble - Activision, its closest competitor. EA has global population levels off), the The field becomes more and more hit- it’s like betting all your chips on number the broadest, most diverse portfolio of disparity is so great that you can treat driven. There is no mid-list. You only 32. As a small publisher, you can afford anyone. the growth in sales as a linear curve, and want home runs. And those home runs to produce only a handful of titles every the growth in cost as an exponential have to cover the losses on everything year - and if the ball lands on 32, you And they know it. And they’re the villains one. else. can make big money. But if you go a in this piece, because they’re the ones year or two without a hit - you are who keep raising the budgets and the And what’s the upshot of that? As a result, you need size to survive. It’s screwed. Goodbye Acclaim. Goodbye costs. Everyone else has to stretch to what the finance folks call “portfolio Eidos. Goodbye Interplay. And tomorrow keep up. Raising the development bar The result is that the average game risk;” if you invest in a single stock, - maybe Goodbye Rockstar. has, for more than a decade, been a (not the industry as a whole) loses more you’re doing something very risky, conscious corporate strategy for EA, a and more money. The publishers make because you’re tying your fortunes to a This is why Sumner Redstone has been means of squeezing out less capitalized up the losses on the few games that hit. single company. That’s why it’s prudent building up Midway’s studios; Midway competitors. And it works. needs to get big, or get out of the game. They need a bigger spread of product. So the big get bigger, and the small lose They need to spread their portfolio risk out - is that a problem? over more titles.

This is why there are only four stable publishers in the field - EA, , Sony, and . The latter three are mainly in the hardware business (and Nintendo is not immune - Revolution could easily go the way of Dreamcast). They’ll do okay, they have deep pockets and a diverse portfolio, and anyway M M M M M M  M It is if you’re a developer, because it wearing different jerseys and have “There’s no point in publishing a game means you have fewer and fewer slightly different behind-the-scenes data. unless there’s a brand attached to it.” potential publishers to pitch to. Ten years ago, you had a couple of dozen Publishers would love all games to work Do you buy games for the brand? Or the plausible places to take a game. Today, the same way - and they’re trying to gameplay? you’re lucky if you have six. make it happen. That’s why they look for franchises - not for good games. Of course, maybe there’s a reason And when you pitch them - those Acclaim is dead. increasing budgets breed conservatism. The publishers (other than maybe EA) Ten million dollars is a lot of money to aren’t immune to cost pressures, of Another quote that made me sit up and risk. The publishers are averse to risking course; they look for ways to save take notice was from Tom Frisina, VP and it on anything they don’t view as a sure money. Development in lower-cost General Manager at EA - he runs their thing - or as close as they can come to places like Eastern Europe and Asia is on external developer program - at GDC one, in this uncertain world. the rise, particularly for lower-budget last year. He said, “We are always titles and games for handhelds. looking for something new and That’s why you get sequel after sequel. Pressures on developer margins are also innovative.” That’s why any crap media license gets a intense; it’s very hard to negotiate a game (Dukes of Hazzard, anyone?). The developer royalty over 15% today. And I’d like to believe that - but of course promotional spend by the movie studio is there’s increasing use of middleware - EA’s product mix belies it. Tom is one of viewed as a way of generating interest in which has the problem that all games the good guys, but in essence what he is the game without additional cost to the start to look the same, because they really saying is that they want checkbox game publisher. share the same engine. innovation - a little something to differentiate your RTS from every other The publishers would like all games to be And everything has to be a brand. RTS on the market. They still want an like sports games. With sports games, all RTS, though - God forbid you should do you have to do is improve the graphics I was at the Games & Mobile Conference something really innovative, like try to incrementally and throw in the new (a small one, in New York) two years offer a whole new gameplay experience. player stats - and the little drones will go ago, when Edmond Sanctis, then COO of out and buy the new version every year. Acclaim, said something I could not It Sucks to be a Developer They’re basically buying the same game believe he’d said in public (and that The implications for developers are even over and over, but the players are made me want to throttle the living more dire. You will not sell a publisher on daylights out of him, of course). He said, a title unless the marketing weasels know how to pitch it to the retail The truth is that unless your last name is “An industry that was once the most In other words, barring a miracle, you channel. If it fits into an existing, “Wright” or “Miyamoto,” the odds of innovative and exciting artistic field on will never see a dime beyond your initial established game category - an RTS, an getting anything innovative published the planet has become a morass of funding. And no, you will not make a FPS, an RPG, action adventure, driving, today are nonexistent. In fact, the only drudgery and imitation” profit on the funding alone, unless you sports - then they know how to sell it. thing you can get funded is something cook the books, because the publishers But if you’re doing something novel - that’s based on a license or part of a Doesn’t sound so naïve now, does it? want to make damn sure that every forget it. franchise (can you say “Coasters of And we’ve only talked about the dollar they spend winds up in assets on Might and Magic?”), and incrementally imitation aspect - you can talk to EA_ the disk. And since you are utterly reliant Does anyone seriously think anyone innovative at best. Spouse about the drudgery. on them for both money and access to other than Will Wright could have gotten market, they have the leverage to EA to publish a game like ? And Does this mean that developers self- So being a developer is creatively ensure that it does. actually, EA tried to kill The Sims many censor, not even bothering to bring their frustrating - but from a business times before it was finally released. From best ideas to publishers because they perspective, it sucks worse. If you are Developers live from contract to contract what I’ve heard (and this is definitely know they don’t have a prayer of getting relying on publisher funding, you are - and if they don’t land the next hearsay), ’s comment at the sold? highly unlikely to achieve a royalty rate contract, they’re out of business. meeting where publishing was approved of more than 15% (which is based on Happens all the time. It’s happened to was: “Well, it’ll only sell a hundred You bet your ass. wholesale price less MDF - typically more me, in fact, and I’m hardly alone: Work thousand copies, but it’ll get Will off our like 7% of the actual consumer dollar). like a dog, get to gold master, have a backs.” There are a lot of very bright and And your entire $5m budget (or party to celebrate - and file for creative people in this field - no lack of whatever) is recoupable against your unemployment. We’re only talking about the best-selling them. But business realities trump royalties. Thus, to recoup that advance, PC title of all fucking time. passion every time.I’m going to bring up you need unit sales of well over a In fact, you may not even get to gold that Scratchware Manifesto quote again: million. master. Publishers are increasingly willing to kill projects midway - or even after going gold. The cost of advertising and promotion can double the total cost today, the id-equivalent wouldn’t own it - - and if they don’t have confidence in the the publisher would. And if id got game, there’s no point in throwing good obstreperous, they’d just have the next money after bad. version developed by someone else. gamer before there was such a thing as hard data available, but quite likely a home computer. $200m+ at retail); the conventional Basically, as an independent developer in In other words, not only are business board and cardgame market ( the games industry, you’re just fucked. conditions harsh for developers - but In those days, there were perhaps a few doesn’t break out the numbers, but I’d Back in the day, a company like id could there is no upside. Your only possible tens of thousands of hardcore board believe close to $1b); or the arcade generate a surprise hit, rake in the win, in fact, is to develop enough of a wargamers, and perhaps an equivalent game coin drop (I’d guess still over royalties, and buy its own independence rep that a publisher buys you out. And number of people who, like Sid Sackson $500m). Not to mention advergaming, - today, they’re sitting pretty, they aren’t then, more likely than not, the publisher and Phil Orbanes, were passionately and the advertising spend on sites like reliant on publisher funding because they guts you. Goodbye . Goodbye involved with conventional boardgames. Pogo.com or RealArcade. have the resources to fund their own Microprose. Goodbye Westwood. And the two industries, together, grossed development, they own two franchises, Goodbye . under $100m at retail. And instead of a handful of people who and they’re in the catbird seat when it consider themselves hardcore gamers, comes to negotiating leverage. Why This is Bad Today, the figure $8b gets bandied about we have tens of millions. I’m one of the rare gamers over 35. for the games industry, but actually, But it’s virtually impossible for that to That’s because, unlike most people my that’s an undercount. It doesn’t include And instead of just three types of games happen today - both because royalty age, I was exposed to games as a teen. subscription fees for MMOs (on track for - conventional boardgames, cardgames, rates even for established developers are When I was a teenager, there were two $1b+, US alone, this year); casual and - we have dozens. RTS, under pressure, and also because you sorts of games in this country: downloadable games ($50-$100m, RPG, tabletop RPG, MMO, action- don’t get to own your own IP. You’ll sign conventional board and cardgames, depending on who you believe); mobile adventure, shoot-em-up, platformer, it away just to get published, and as far which I played enthusiastically as a child, games ($100m+ domestically this year, driving games, dancing games, hunting as the publishers are concerned, that’s and the board . (Yes, I predate $1b+ worldwide); the hobby games games, sports games, LARPs, ARGs, “big non-negotiable. If Doom were to happen D&D.) I was a wargamer, a hardcore market (RPGs, TCGs and the like - no urban” games, freeforms, text adventures, graphic adventures, novel. Doom created the FPS genre. possible for “the ” have computer wargames, games, Warcraft and Command & Conquer already been discovered. games, flight sims, trading card games created the RTS. Sim City created the ... and on and on. sim/tycoon genre. GTA and The Sims are But this is insane. Innovative, compelling their own genres, too - they novels are published every year, and Every one of these game styles has its don’t have names yet, but call them the that’s a medium that’s 300 years old. passionate fans. And every one of them simulated world and the virtual We’re only 30 years into the gaming has been invented in the last 30 years. dollhouse. revolution. Additionally, games are an And the last 30 years have seen huge enormously flexible form: They’ve been growth in gaming. Yes, in all cases you can point to created with every technology from the precursors that had some of the Neolithic to the modern. And software is There is a correlation here. elements of these games - Wolfenstein an enormously flexible medium, too; if for the FPS, Little Computer People for you can specify it, you can implement it. The growth in the games industry has The Sims - but in all cases, these games We’ve gone from three genres to dozens been spurred by an enormous ferment of combined things in a new way. in a few short decades, but we’ve creativity. Each new successful game charted only the merest coastline of a style spawns its own audience of fans, Think of the space of all possible games. vast, virgin continent. expanding the overall size of the market. Most of the games in that game-space The hardware guys would have you will be uninteresting. But here and there, And we need to keep exploring it, or believe that there’s a direct correlation in that probability-space, are local peaks, we’re going to get stale. between hardware capability and the places where some combination of size of the market, but that’s false; mechanics produce compelling gameplay All creative media get stale, at times; it’s people buy games for the gameplay - and around that peak, there are lots of happening to mainstream film right now. experience, not for cool hardware, and possible variations on the theme. Finding But film, music and comics have the way to grow the market is to create a new, successful game style means something the game industry doesn’t new experiences - not to release game finding a local maximum in the space of have: They have parallel distribution seven in a franchise. all possible games - and a new audience. channels for independently created product. They have a path to market for If you look at the biggest hits in the The publishers would have you believe quirky, oddball, innovative, creative field, you find that a high proportion - that “we know what works.” In other work. And that path to market not only not all, but a lot - are games that came words, that all of the local maxima allows creative people to support out of left-field, that did something themselves in a modest way - it also provides a way for the larger What do we want? What would be ideal? conventional market to discover new talent, and new genres. It provides a A market that serves creative vision lower cost way to experiment - and that instead of suppressing it. An audience very experimentation reinvigorates the that prizes gameplay over glitz. A larger field. business that allows niche product to be commercially successful - not necessarily The nightmare scenario for gaming is or even ideally on the same scale as the that we become like comics in the 60s conventional market, but on a much and 70s - a niche, repetitive field limited more modest one: profitability with sales to a handful of genres with no real of a few tens of thousands of units, not opportunity for growth. It might even be millions. starting to happen: Video game sales in Japan have been declining for years, and And, of course - creator control of even in the US, publishers are struggling intellectual property, because creators to match their 2004 revenues this year. deserve to own their own work.

We Have to Blow This Up Greg Costikyan is a widely-published For the sake of the industry, for the sake author on the subject of of gamers who want to experience and the role of games in culture. something new and cool, for the sake of Currently, he is writing and consulting developers who want to do more than for Nokia on the subject of the same-old same-old, for the sake of design. our souls, we have to get out of this trap. If we don’t, as developers, all we will be doing for the rest of eternity is making nicer road textures and better-lit car models for games with the same basic gameplay as Pole Position. Spector is right. We must blow up this business model, or we are all doomed. Which American designer personally made the most money last year from computer games he or she designed? Not the most money for a company, mind you, nor for a studio or licensor, but individual, take-home, taxable income.

Was it a famous game god? John Carmack, Will Wright, Sid Meier, Warren Spector? Probably not. It was probably some guy you never heard of who wrote some little shareware game you never heard of. Those “casual games” - the and Mahjongg tilesets and card games and Breakout clones and match-three - type things - are downloaded, and sell, in numbers some game gods only dream about. Over the lengthy life of a successful , the independent (“indie”) designer can make serious, serious money - high six-figures and low sevens. Personally.

Many game designers hear this and shrug, as if you told them there’s more money in, say, selling John Deere tractors. “So what? That’s not really computer gaming.” Casual games are so far off the industry radar, hardcore designers don’t even bother to sneer. If you compare their situations - big- • My games might sell for years, not time triple-A hardcore designer vs. indie months, so I could actually polish shareware casual designer - snobbery is them instead of shipping an untested not only unjustifiable; it’s borderline beta in time for Christmas. ... insane. Yet how many designers of major retail first-person shooters or real-time • People might play my games - designer Steve Pavlina has had strategy games or massively multiplayer obsessively for months or years, not enormous commercial success with his company, online roleplaying games ever think as blow through them in ten hours and Dexterity Software. Pavlina wrote a series of follows: move on. ... articles on creating and marketing shareware games that have inspired many indie designers. • “If I went indie and worked for myself • And if I do absolutely everything right This is the best way to get oriented and, inevitably, creating casual games ... - which is under my own control - I inspired. An excellent starting point is Pavlina’s could eventually earn two or three 2002 article “Shareware Amateurs vs. Shareware • I could make two or three games times my current salary. Or more. Professionals.” each year instead of one every two Personally.” years, for a cost of thousands, not - Then get oriented with the IGDA 2005 Casual millions. ... Evidently not many designers ponder Games White Paper. this, even for a moment - though it’s all • I’d work alone or with a couple of true. It is a curious situation. - Thomas Warfield’s blog “A Shareware Life” has others, not on giant teams rife with much good information, as do the Indie Gamer politics. ... Of course designers don’t desert Developer Forums. hardcore games because they are, • I could be my own boss, pick my own themselves, hardcore. They put in - Casual game programming environments include projects, own my own intellectual sweatshop hours creating their next FPS Flash, Java, Shockwave, PyGame for Python, the property, set my own hours, and do or RTS or MMORPG, then knock off work WildTangent plug-in, and the free PopCap Games the marketing right, instead of coping and ... play an FPS or RTS or MMORPG. framework. with my idiot publisher. ... They design the games they love. That’s great; it’s just their monomania that’s - For a 3D game, look for a free or cheap engine • I could do something weird and weird. Reading the interviews designers such as Torque, Irrlicht , Cipher, Blitz3D, 3D innovative instead of just tweaking give to computer gaming magazines, you GameStudio, or Ogre. Ambrosine’s Games Page ten-year-old gameplay, and reach an could easily conclude the only game has a long list of game creation resources. audience ten times as large. ... style they consider worthwhile is Kings of Casual up a picture of his Mercedes on his web “Selling shareware games has been very, site - not really a great way to get sales, very good to me. And I’m certainly not in my opinion. But his company does the only one,” Thomas Warfield wrote in make millions every year).” adrenaline-soaked action. It’s like years upon years, even decades. For a a March post on his blog. “There are lots thinking the only good trees are giant console designer on a 30-person team of other people who have been quite There are other successes. In 2000, redwoods. (plus outside contractors) with a $500K successful selling shareware games. Seattle programmers John Vechey, Brian monthly burn rate, struggling to hit the Steve Pavlina at Dexterity is well known Fiete, and Jason Kapalka, formerly The Invisible Market six-week sales window before Christmas, in the indie game world. DreamQuest employees at online gaming sites Meanwhile, out in the large and diverse knowing his game is 90% certain to miss Software and Silver Creek do quite well Flipside and Pogo.com, started a new casual ecosystem, you can download the top 20 and vanish into the La Brea (both of them) in the niche of company to provide web games for games about bridge construction , tar pit of next year’s bargain bin, this multiplayer card games. Kyodai portals like Microsoft’s , Yahoo! political strategy , space station realm appears utterly alien. Mahjongg clearly sells very well.” Games, and RealOne Arcade. When they management , gallery shooting, and - started selling downloadable “deluxe” uhh - lawn mowing? There’s Gish, where Still, there are a few guides. The stalwart How well? It’s hard to tell. Successful versions of their games, sales took off. the hero is a 12-pound ball of tar, and Game Tunnel has covered the casual shareware game designers are a cagy Today PopCap Games employs nearly 20 Wik & the Fable of Souls, where you scene for years. Others in the industry lot. The Kyodai site claims “9,590,367 people, sells 20 titles on its site, gets six swing by your tongue. The mainstay are just starting to pay attention. The visitors here since April 2, 1997.” million visitors a month, and claims a and arcade games are still good, annual Game Developers Conference has Warfield’s own gamePretty Good total of ten million downloads. PopCap’s too: If you liked Clue or the old DOS had a Casual Games track the last couple Solitaire has been the top-selling best-known title, Bejeweled Deluxe, has game Sherlock, try Inspector Parker. To of years, and this June the International solitaire game for ten years (the current sold nearly half a million copies. The recall why you played Tetris until your Game Developers Association (IGDA) version offers 611 variants) and sells thumbs bled, check out Revolved. began a Casual Games SIG (special more strongly each year. Warfield is interest group). The 125-page IGDA certainly well into his second million A hardcore designer who deigns to look 2005 Casual Games White Paper pegs bucks - not that he’ll say so: into casual games may feel sharply the American casual market at $600 “[S]hareware is a funny business. That disoriented. Hundreds of dinky try- million in 2004 and projects growth to is, since people can try your product before-you-buy games, created by one $2 billion by 2008. (Source: “US Online before they buy it, it’s generally not a or two or three people, with file sizes PC Gaming Forecast & Analysis, 2004- wise policy to act like some kind of under ten megs, targeting low-end 2008: Growth Continues,” December Donald Trump. Shareware authors, as a Win98 platforms, selling one copy for 2004, by business think- IDC.) rule, don’t generally toot their own every 50 or 100 free downloads, for horns. (There is one guy I know who put typical PopCap player is a 35-year-old Casual Means Hard Work that made their games popular. But just woman. A 2003 Wired News story Yes, it’s definitely possible to get rich in as often, they cite virtues of the indie quoted Kapalka: “It’s not just hardcore, casual games. In fact, though, most approach that have nothing to do with early adopter nerds who have newcomers fail dismally. The many getting rich. In a May 2003 blog entry computers, but moms, too, and they’re reasons include lack of patience, lack of Warfield wrote, “Being a shareware an audience that’s much bigger than originality (the world doesn’t need author is the greatest job in the world. hardcore gamers.” another Breakout clone), and lack of You can work at home, so you avoid a marketing. daily commute to an office. You are your In 1997 David Dobson, now an assistant own boss. You have all the benefits of professor of geology in Greensboro, A designer’s priorities in creating and owning your own business. You can work North Carolina, created Snood, a modest selling casual games are completely or not work whenever it is convenient. knockoff of Bust-a-Move/Puzzle Bobble. different from hardcore games: small file But the best thing about being a Somehow Snood caught on, and by 2001 size, low platform requirements, sloooow shareware author is that you have a survey by Jupiter Media Metrix web growth (shareware publisher Steve customers who choose to be customers. researchers found Snood to be the Pavlina advises a 5- to 10-year [...] you know that only people who world’s ninth most-played computer strategy), ongoing active marketing, and really actually like the game are buying game. Inexplicably, it has enjoyed over frequent, numerous iterations of the it, so you know your work must be good. seven million downloads, and eight years same game. On the Indie Gamer The end result is that it is a much more on, it’s still going strong - and is still off Developer Forums, Steve Verreault of fulfilling job.” the radar of most gaming metrics. Greg Twilight Software advised, “Don’t just Costikyan observed, “Game developers release your game once. Release it four Allen Varney is a freelance writer and almost can’t take Snood seriously. Its or five times. Keep looking at what the game designer based in Austin, Texas. success calls into question their very users are saying and make His published work includes six books, lives - the long hours spent laboriously improvements to the game. Tweak the three board games, and nearly two building these huge, expensive 3D demo. If you put it out and it doesn’t dozen role-playing game supplements. worlds, these involved software engines sell, rework it. That’s the beauty of with amazing visual effects and shareware. You didn’t print 50,000 CDs - complicated AI. If it’s all really as simple you can release it again and again, and as Snood, why are they working 60 to 80 it can keep selling for years.” hours a week for years at a time?” Most successful casual designers stress the hard work and shrewd marketing The fact is, there is no such thing as virtual commerce. You might think you’ve been making money buying and selling virtual items from your favorite MMORPG on eBay or IGE, but it’s just not true. Don’t tell the game companies, though. As far as they’re concerned, virtual commerce is alive and well - and they’ll do anything to keep it that way.

If that sounds like an upside-down version of the world you know, you may be in for a surprise. Let me explain.

Aimee Weber sells clothes at stores in two locations: one at the southwest corner of Umber’s central park, the other at the east side of the Chase Manhattan park near the Limelight Club in Hawthorne. If those places don’t sound familiar to you, it’s because you probably haven’t spent much time in Second Life, a 3D virtual world where reality is what you make it (for the most part), and a place that gives you the tools to make reality almost anything you please. Umber and Hawthorne are the names of activities. One made more than $38,000 two of Second Life’s 1,000 or so in one month alone earlier this spring, interconnected server regions. (It’s all according to Linden Lab vice president one infinitely scalable world inSecond for product development Cory Ondrejka. Life, no sharding here.) Aimee Weber is Though SL is a place where you can live the name of a Second Life who’s out your as a sex slave, a garnered quite a reputation for her dream-world architect or a guy with a fashion line of funky skirts, tops and box of cocks, among other things, it’s plaid lingerie - all of which can be worn also a place where you can turn your only by other Second Life avatars, of fantasies into reality in the form of cold course. hard cash.

But as virtual as all this sounds, Aimee And Second Life is not alone. Selling UO earns real money for her work. That is, gold or EQ plat on eBay has long been a she earns Linden dollars, which can then moneymaker for dedicated gamers. And be converted into U.S. dollars on sites it doesn’t take a Chinese like GamingOpenMarket.com, IGE.com operation to turn a profit. One gamer I or eBay. While she won’t say just how spoke with recently said he earned much she makes, she does say her $25,000 a year for the three years or so virtual clothing sales bring in enough that trading UO items was his full-time that if she concentrated on it full time, it job. He wasn’t getting rich at it, but as would pay all of her real-life expenses. he pointed out, “It doesn’t get any better than getting paid to play games.” Others in Second Life earn even more. According to Philip Rosedale, CEO and All in all, the market for goods and founder of Linden Lab, the company services produced in online games - behind Second Life, a handful of the things like gold and plat, power leveling world’s 40,000-plus residents earn the services, entire characters or the set of virtual equivalent of $100,000 a year or armor that recently sold on more, most in the virtual real estate eBay for $167.50 - has reached almost a business, and close to a thousand of billion dollars a year, according to Steve them turn a profit on their in-world Salyer, president of IGE.com, the largest broker of . By some it is the ideas that are contained in its You might not be able to hold Aimee’s estimates, the market could be twice words. You’re buying (or in this case, panties in your hand (as much as you that size. getting for free) the content, not the might like to), but that’s not the point. physical product itself. The same is true You’re not buying them because you The idea that someone would pay real for movies, music, software and a host want to wear them in the real world. money for a collection of screen-bound pixels that will never enjoy a physical existence is old hat to most gamers, especially to MMORPG fans. But try to explain the idea to most civilians and you’re met with blank stares or, worse, a shocked incredulity that someone might of other things we buy, sell and consume You’re buying them because they add be tricked into buying something that each day. Yet none of those things get something to the character you’re doesn’t actually exist. In laypersons’ slapped with the “virtual” label. No one guiding through the online world. They mouths, the “virtual” label has even rolls their eyes when you tell them you add to the story that unfolds on your taken on a slightly pejorative tone, one just bought Photoshop or rented a DVD. computer screen each time you log into that seems to imply a touch of insanity But try to talk about the market for your Second Life. In that sense, they’re no about anyone who would be foolish favorite MMORPG’s armor and weapons, different from buying the latest issue of enough to pay hundreds of dollars for an or the pair of thigh-high stockings you your favorite manga or taking yourself to entry in a database in Austin and some just bought for your Second Life avatar, the movies. When you buy a DVD you’re screen art the size of a postage stamp. and often enough the eyes don’t just not paying for a piece of plastic (which roll, they glaze over at the same time. costs pennies to produce), you’re paying But what is it that’s really being bought for the content stored on it. And Aimee’s and sold here? The fact is that a great For those who’ve never set foot in a skirts and stockings are content in much deal of our real-world economy these virtual world it’s hard to imagine why the same way. There’s really nothing days consists of things that would be someone would pay cash for a sword or virtual about them. termed “virtual” in another context. Take a skirt that’s made of nothing but this magazine, for instance. Chances are software. But what even most gamers The same goes for the virtual items you’re reading it on the screen of your don’t realize is that the things they’re bought and sold in more traditional computer. Does that make it virtual? No. buying and selling in online worlds aren’t MMORPGs like World of Warcraft, Guild Because The Escapist is more than just a virtual at all. Wars and all the rest. They add to the pattern of colored pixels on your screen, narrative that is the reason you’ve logged on in the first place. That game’s currency. More than 80 accounts profit from the “virtual” items they claim Who pays that, the game company or Bewildering Sword of Whoop-Ass you’ve were permanently banned. And yet WoW sole ownership of? Why haven’t they the player? And what if the buyer, the been coveting isn’t something you can gold and items are still sold on eBay and gone to federal regulators to stamp out seller and (a British company) are hold in your hand, but it’s something elsewhere every day, and at least one this trend that is supposedly destroying all in different countries? What authority that will make your avatar’s story more “power seller” runs an eBay store that is the integrity of their games? would collect those taxes? And, to take it interesting. It’s extra content in the clearly flagged as offeringEve Online a step further (though not that big a same way that buying the director’s cut goods, and has been doing so for over a As Eikenberry puts it, “They don’t want step), if game gold is a recognized of your favorite movie is - you get a year. IGE moves vast sums in game to go to court and actually have a value currency, what would be the anti– richer, more engaging narrative out of it goods and currency every day. And even assigned.” money-laundering reporting (except in the case of Apocalypse Now a site like MarkeeDragon.com, which Redux). There’s nothing virtual about it. deals only in items, does a His argument makes sense. If that suit million dollars in annual transactions. of Runescape armor is legally found to And this is what game companies fear. constitute a separate product of Jagex, As Marcus Eikenberry, who runs the company behind the game, a host of In March of this year, Blizzard MarkeeDragon, points out, Blizzard has messy legal questions immediately crop Entertainment, makers of World of been known to send “cease and desist” up. For instance, what if Jagex’s armor Warcraft, banned more than 1,000 letters to dealers informing them that doesn’t work as advertised? Is Jagex accounts for selling WoW currency and they will have to provide financial liable for damages? Or would it be the goods on eBay and other sites. In June, records to the company of just how player who sold the armor on eBay? An 8 CCP, the Icelandic company that much they’ve bought and sold, but they percent sales tax on $167.50 is $13.40. developed Eve Online, moved against rarely if ever back it up with legal action. what it described as “a virtual crime So why don’t game companies move syndicate, dealing in vast sums” of the more decisively against the people who requirements when large “money” companies in the far more litigious transfers were made? .

Already, the game companies’ nightmare So they try to scare you off. But for all scenario has started playing out in the bannings and press releases, China, where in 2003 the Beijing MMORPG companies don’t seem to be Chaoyang District People’s Court ordered able to convince most players that series of agreements (in the form of even considering hiring a virtual Federal the maker of the game Hongyue (Red there’s anything wrong with the trade in transactions) that, when taken together, Reserve board to manage Second Life’s Moon) to return the equivalent of $1,200 game items. Instead, they feed the give a rough idea of what the currency is economy. Game currency not real? I in virtual , including virtual that what you’re dealing in is worth. That’s what economics tells us: A don’t think so. biochemical weapons, to a customer who somehow “virtual,” something of no currency is a unit of exchange facilitating went to court after the items were stolen consequence anyway, so why bother. the transfer of goods and services. The Which brings us back to Aimee’s by a hacker. The court found the game Don’t believe them. What you’re dealing only difference between the U.S. dollar underpants. They sell so well these days company responsible for the holes in its in will only become more and more real and the Linden dollar is that many more that Aimee, a 20-something web security that allowed the hacker in - as more and more people start spending people deal in greenbacks than in designer at an art services company, is even though what was stolen was time in virtual worlds. Lindens. But the fact that Lindens can be toying with the idea of converting her ostensibly the sole property of the used to buy dollars is all the proof that’s virtual fashion line into one you could company and not the customer. The In economic terms, there’s actually no needed that this “imaginary” currency is wear on your physical body. Others are prospect of these kinds of cases seeing difference between real currencies like worth something in the real world. taking similar cues from Second Life. A the inside of a courtroom must strike the dollar, the pound and the yuan, and British trendspotting firm recently fear in the hearts of many game virtual coin like the platinum piece and Already, game companies are beginning assigned someone to mine SL for the Linden dollar. The value of each is to admit this to themselves. Sony Online commercial ideas, and a big North determined the same way: through a Entertainment’s new Station Exchange American bank is setting up a program program supports “real-money trade,” as to teach teenagers about money it’s called, on a number of EverQuest II management in a dedicated region of servers. Games like Project Entropia SL’s world. Sure, there are plenty of in- explicitly recognize the value of in-world world items being bought and sold by currency by allowing players to buy it SL’s residents every day (almost $1.5 with a credit card, not just on eBay but million worth in a typical month, within the game itself. Linden Lab is according to Ondrejka). But where commerce is concerned - virtual or not - much more is going on than just fashion than an extension of your first one. For items isn’t going away. In fact, it’s just taking place within them will grow too boutiques and land deals. many people - and this goes for the going to grow. Trading MMORPG items great for anyone to resist. And as that players of more traditional MMORPGs as and designing pixellated clothing are happens, online worlds, and the All this is happening because Second Life well - the stories they’re creating in now viable alternatives to trading bonds commerce that takes place there, will be is a different kind of virtual world than virtual worlds are very much a part of or designing clothes you can actually forced to come out of the “virtual” closet almost any other. It’s not a game, but it their real lives. It’s just that most of wear. What we don’t yet know is what and admit that they’re not virtual at all. contains multitudes of games. (In fact, those stories don’t have an impact to the laws will govern such ventures. Game one resident scripted an in-world game tune of $100,000 a year. companies’ Terms of Service - which You can’t touch Aimee Weber’s virtual that was then licensed to a real-world always include a “we can do whatever panties, unfortunately. But it’s worth game company for a sum “in the low five But they do have an impact, both in we want” clause - will not be enough. remembering that they’re very, very figures.”) The “things” of the world can’t terms of entertainment and in terms of Eventually, these things will become real. be touched, but they are real enough to economics. That’s why the important more clear, either because the courts earn you a living. No one minds if you questions to ask, as we go on creating step in, because game companies come Mark Wallace is a journalist and editor do, since Linden Lab grants residents the the shared narratives that take place in to embrace what’s already happening, residing in Brooklyn, New York, and at intellectual property rights to whatever it virtual worlds, have to do with more because some open-source model of the Walkering.com. He has written on is they create in SL. And the stories that than just what makes a great game and future is developed or because the power gaming and other subjects for The New can be created there are so rich and whether RMT is spoiling immersion. The of the players and residents of online York Times, The New Yorker, Details and complex that they are less a second life real-money trade in so-called virtual worlds to create the narrative that’s many other publications. Layout Artist Patrick Jones Nintendo to Purchase 2.2m Shares of Its Own Power. Like the online retailers’ PSP preorder Stock strategy, the only way to secure a unit from major Executive Editor Julianne Greer Lead Web Developer In a purported effort to stave off outsider influence, retailers on release day will require gamers to Whitney Butts Nintendo intends to push their interest in public purchase far more than just the system. shares of the company to over a 10% stake. The Contributing Editors Joseph Blancato IT Director deal, which will cost the company over $200m if Asheron’s Call 2 to be Discontinued at Year’s Jason Smith completely successful, will more than likely End JR Sutich guarantee at least one more appearance with Sony In a letter to the community, Jeffrey Anderson, Copy Editor Publisher and Microsoft in the console wars. CEO of Turbine, announced Asheron’s Call 2 will be Alexander Macris discontinued December 30, 2005. The sequel to Wendy Beasley 360 Preorder Packages Reach $750 the more popular Asheron’s Call never surpassed Associate Publishers The Xbox 360 preorder packages on sale at its predecessor’s numbers. The decision to close Research Manager Nova Barlow Jerry Godwin Electronics Boutique can slam the hard core user the game may also have been influenced by a Gregory Lincoln right in the wallet, weighing in at over $750, desire to focus more resources on their two assuming you take the one-day shipping option. upcoming MMOs, Lord of the Rings Online and Contributors Joe Blancato Director of Advertising According to Gamespot, the high-end package Dungeons and Dragons Online, which are both Susan Briglia includes an extra wired controller, an extra wireless highly anticipated. Greg Costikyan controller, a 64MB memory unit, and four games: Dana Massey Allen Varney Chairman of Themis Group Perfect Dark Zero: Limited Edition, Dead or Alive 4, Thomas S. Kurz Project Gotham Racing 3, and Kameo: Elements of Mark Wallace

Producer Jonathan Hayter

Volume 1, Issue 8, © 2005. The Escapist is published weekly by Themis Group, Inc. Produced in the United States of America. To contact the editors please email [email protected]. For a free subscription to The Escapist in PDF format please view www.escapistmagazine.com

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