Friday, May 11, 2007

93% of new IPs Fail

According to Steve Allison of Midway (says Shacknews).

Which sounds daunting. But wait, there's more (some via N'Gai Croal's Level Up)

"If there were, 'great' games Beyond Good & Evil, Ico, Okami, Psychonauts, Shadow of the Colossus, Freedom Fighters, Prey and Midway's own Psi-Ops would all have been multi-million unit sellers. The aforementioned games are all games that average review scores of nearly 90 percent out of 100, some even higher. The reality is none has sold more than 300,000 units at full price in the U.S. and a couple of these less than 250,000 units lifetime even with bargain pricing."


"To rectify the issue of overlooked games, Allison suggests that developers focus on broadening the appeal of their games beyond hardcore players, crafting an on-screen experience that causes casual gamers to respond "I've got to get that" or "Bad ass!". The executive also noted that timing is key, using the example of moviegoers overlooking an asteroid film if two others recently arrived in theaters before it."

Steve doesn't get it I think.

The problem is not that new ideas have limited appeal. If you examine most media, it is painfully transparent that new ideas always have limited appeal. Even many of the darling franchises that the executive class have come to rely started out with relatively humble roots. Some IPs are immediate break-out hits, but most of them will hit a middle layer.

The first problem is this: "broadening appeal" is not something that you can just stick in and hope it works. A successful IP is more than the sum of its parts, so taking away, say, the aesthetics of Shadow of the Colossus and replacing with Tony Hawk-style graphics (but the same basic gameplay) makes it a worse IP rather than a better one. It makes the IP more likely to fail. There's an occult magic to making a new IP and you fuck with that at your peril.

The second problem is this: In most other disc-based retail media, 300,000 units sold of anything new is actually pretty damned good. Book authors would faint at the idea that they've gained that many sales of their first book. Indie movie makers would be very pleased indeed. Because, when you break that down into numbers, 300,000 sales could be anywhere from 7-15 million dollars worth of revenue at the till.

That's an awesome number. Unless you work in games, and the reason for that is that games cost way too much money to make, and the margins for third parties are less than ideal. Manufacturers have an easier time of it because they make more per copy, have a lot of prestige value riding on being seen to be cutting edge, and can market in ways that third parties can't. This is why manufacturers are increasingly becoming the sponsors and source of successful new IP.

So the overall problem is that making games is too expensive. 93% of IPs don't fail. They don't succeed enough for their paymasters to recoup all the money that they've wasted, to pay all the hands that are out looking for their cut (including the manufacturers) and the industry is too restrictive as a business to allow for middle layer development and publishing.

So the overall overall problem is free market access for small and middle-level players who are better at being efficient, an end to excessive censorious controls, and a way to build the industry into a rounded business that can cater to more levels than just blockbusters or nothing at all. It's the biggest single issue item on the agenda for developers, journalists and executives that should be being pursued because it's killing the future of the industry.

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