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Summary:

“We’re boring people to death and making games that are harder and harder to play,” John Riccitiello, the new CEO of Electronics Arts (ERTS) told the Wall Street Journal. As they say, the first step is in admitting that you have a problem. EA and the […]

“We’re boring people to death and making games that are harder and harder to play,” John Riccitiello, the new CEO of Electronics Arts (ERTS) told the Wall Street Journal. As they say, the first step is in admitting that you have a problem.

EA and the video game industry at large has a massive problem: one that of attention. Video games are no longer the only game in town when it comes to digital entertainment. Riccitiello himself says the games are “at risk of being a little less interesting than Facebook and iPods and the next cool cellphone.”

erts.gifWagner James Au wrote an extensive essay about this crisis of attention facing the video gaming business. The move away from games shows in the stock performance of EA and some of its peers.

  1. Yeah, that and stop forcing us europeans to play your games in our native languages. I’m refering to the last Harry Potter game that has NO option for English! Sure kids might prefer it but you are missing a big part of your target audience.

  2. Raymond Padilla Monday, July 9, 2007

    “The move away from games shows in the stock performance of EA and some of its peers.”

    I couldn’t disagree more. The quality of EA’s products has been pretty poor for the last three years. We’re also at the start of a console generation, which means there are fewer games out for consumers to buy for the primary consoles. In two years people that aren’t familiar with the gaming industry will write things like this:

    “A resurgence in videogame stocks shows that consumers are tired of their iPods and social networking sites. They just want to play games!”

    It’s a cyclical business and right now it’s at the bottom of the hill. Everyone knows it’s going to go up as more games are available for the PS3, Wii, and Xbox 360.

  3. Paolo Vanossi Monday, July 9, 2007

    I like Riccitiello’s style. Is this Management 2.0?

  4. How about stop whoring out franchises and making endless sequels?

  5. @Raymond,

    You make a good point, although an increase in game library inventory isn’t going to make much difference unless the games are more compelling. As a past senior executive of the gaming industry, I can tell you that the consumer usage model in gaming is based on average time spent on entertainment, and (obviously) capturing the greatest share of that time with your own published titles.

    Throughout the 90’s we saw a drop off in console game sales as the PC emerged as a gaming platform, and as the DVD player emerged as an entertainment platform with multimedia capabilities. Most in the industry thought that an increase in library volume would fix the drop off, but we only created a glut of titles that hurt the industry overall. Eventually, thanks to the Playstation and the XBOX, the industry recovered.

    Today the same model is facing pressure from online gaming, casual gaming like cell phones, social networking, online video consumption, and more. Hence the core gaming model has been significantly impacted by the adoption of the internet by the same audience of 18 to 34 year olds. Also note share of wallet being consumed by the Internet, cell phone carriers, and likely broadband service providers in the home.

    Hence, the gaming industry must drive up interest in their games without creating a glut of titles so that they capture a greater share of entertainment time, and a greater share of wallet. This happens, then they will again enjoy a rebound.

  6. Raymond Padilla Tuesday, July 10, 2007

    “an increase in game library inventory isn’t going to make much difference unless the games are more compelling.”

    Hmmmm, I don’t really agree with this, although I wish it were true. There are too many bad games that sell well. Look at most games based on children’s movies or cartoons. Look at Enter the Matrix (that one still kills me). I’ve reviewed hundreds of games over the last ten years. I’ve seen lots of excellent and/or innovative games sell poorly. I’ve seen even more mediocre (or worse) games sell quite well.

    People will buy brands they’re familiar with. The more sequels and licenses on the market, the more people will snatch up. Again, I wish this had to do more with quality, but that’s really only a small part of it.

    “Eventually, thanks to the Playstation and the XBOX, the industry recovered.”

    See, I think the point here was that consoles were stagnating. Nintendo was so dominant that it became a bit lazy. Sega was trying to see how many add-ons it could stack on its console before it collapsed. Nintendo and Sega also had a pretty poor third-party approval system. Third-party approval has improved tremendously and has helped improve quality across the board. Sadly, this is changing for the worse.

    “the gaming industry must drive up interest in their games without creating a glut of titles so that they capture a greater share of entertainment time, and a greater share of wallet. This happens, then they will again enjoy a rebound.”

    I have no doubt this is going to happen. The three major console have yet to peak. The quality and number of titles will go up for sure.

    Want to be 10K against me? :)

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