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Analysts Predict Tough Christmas For Game Publishers
Thanks to Gamesindustry.biz for its article regarding predictions of a tough 2004 holiday season for all videogame publishers, as an analyst report from Banc of America Securities claims "competition in the games market will be much more intense than last year", and argues that "some games will just not receive any shelf space from retailers, and initial shipments of titles will be very low, even by historical standards." The report goes on to highlight some non-specific specifics: "We have very low expectations for games of other developers with less-known brands... including Acclaim, Midway (except Mortal Kombat), Atari, Eidos, Vivendi (apart from Half-Life 2, if it is released) and even Microsoft (apart from Halo 2)... Expect many disasters this holiday." Is there really a reason for game creators to worry about what sales Santa will bring them?
2 things are happening.
Firstly, PC games are being overtaken by console games.
And secondly, larger studios are getting bigger and more market share at the expense of smaller studios.
Of course some games will crash and burn. If the industry insists on fixed pricing, then it is inevitable that consumers will only buy the most publisised games, as this is the only criteria, other than biased reviews that they have. Whereas if some games were cheaper they could take that into consideration when buying.
If studios are worried, then they should cut the prices of their games. That way more will sell. Better than none selling at all.
May the Maths Be with you!
They need to sell/market games based on demographics.
For example, games aimed at younger kids should come out around christmas because thats peak season for them. (being that most of those games are bought by parents).
And games aimed at older kids/teenagers/young adults (who increasingly have part time jobs e.g. paper round, fast food or whatever as a source of money to spend on games) should be released at the times of the year when the target audience is most likely to have disposable income and/or free time.
Another thing to remember is that for younger kids, the parents (or grandparents etc) are more likely to be the ones making the decisions on what to buy. Although kids will ask for stuff, just because the kid asks for Gorefest Fighters 3005 Extra Special Extra Super Gore Violence Edition doesnt mean that they are going to get it (cue simpsons quote about episode with bart wanting Bonestorm and ending up with a golf game instead)
On the other hand, bigger kids/teanagers/young adults (and also adults) are going to be more liklely to be making their own decisions on what games to buy (especially if its their own money they are spending)
I do think that there is a market for smaller games (that dont have a huge name/licence attatched). However, that market disappears when the studio does the wrong thing and spends big $$$ on the production.
some games will just not receive any shelf space from retailers,
Looks like there's opportunity for more retailers. Or a lumberjack could just go and build them more shelves...
Here's the true question: When will Border's bookstore start carrying video games? They already have videos...
But the greater question is: whay do those games not sell?
Ah, because people don't tire of them as quickly... They are too cheap to make real money for the amount of hours of entertainment they provide. Yet gamers won't spend more than 60 bux.
The solution for the gaming industry: go open source. Work with each other, instead of reinventing the wheel with every little detail. Provide game networks at low cost. It will eliminate piracy (nothing to pirate when the source is available), and you will make money on subscription.
On subscriptions: get together and form a payment association/company, and sell game time cards. Price them at $.25 per hour. That way, if I play 100 hours a month, I'll pay $25, but if I only play 10 (which honestly is all the time I can spare, you'll still get $2.50. Right now you're getting nothing from me, since the games are too expensive, and the memberships are too expensive. The last game I bought was Age of Kings in what, 2000?
Another piece of advice: make games that are cinematographically spectacular, yes, but more than that, make games with good gameplay.
"Piter, too, is dead."
The games industry needs to get alot better focus on their target audience and the way they spend their income on entertainment (Books, music, dvd's and games). It is simpel micro-economics. Only a small fraction of a monthly income is spent on entertainment in these areas and in my personal experience, if I have bought a book for 20 euros, I won't easily buy a new dvd or game of the same price. It is not that I am not tempted, but I just don't have the money.
The problem with newly released games is that they cost twice as much as a new book (take for instance Confusion Neal Stephenson) For me they go beyond my monthly entertainment allowance and I therefore have bought CSI in the bargain bin this month (only 7 euros) but certainly haven't bought a 50 euro game.
Even worse is that many new games are not as much fun as they appear to be. This is true for cd's, dvd's and books as well. However, the pain in buying the wrong thing is much lower because of the lower prices.
So all in all the games industry needs to make it worthwhile for me to buy a game at a whim, without considering the enormous price and without making me scared that I might have bought a lemon. In order to do this, prices have to come down. Way down to the same level of a good book, cd or dvd.
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Christmas is popular because sales double to triple. However, the number of titles released is an order of magnitude greater. *That* is the fundamental problem-- too many titles chasing too few dollars.