Best Selling Video Games of All Time

You have to click this link to see the full chart.

Cool infographics... showing the bestselling video games, or at least those that sold over 1 million copies. Kotaku scored a nice one here, and it shows just how much sales have increased over time, as the recent years are flooded with titles making the mark. Of course, at the scale the artist has had to round off the numbers, but it still gives you a very good idea of where the industry has been in terms of hit games.

Apple Being Investigated By FTC

Look, kids! These can be yours if you just hand over mommy's credit card...

Looks like the complaints about in-app purchasing have found some investigators... the FTC has launched an investigation of Apple over the way kids have been running up hundreds or even thousands of dollars of purchases . (I wonder if smurfberries will be classed as a controlled substance?) Of course, now that Apple has made you enter the password again in order to initiate in-app purchases, this investigation may not go too far. But it's not clear yet whether Apple's solution will fix the problem entirely.

Also of concern is how sneaky companies are prepared to be in order to drain dollars out of hapless children. Excuse, I meant "adult power users," how silly of me to think that children would be the only players of The Smurf's Village. I wonder how this will affect Capcom's revenue stream? Probably makes them feel a little blue...

The Power of iPad

Some fascinating facts and figures about the iPad.

The iPad 2 has gotten good reviews, and it's easy to see why: Thinner, lighter, faster, with cameras, and at the same price as the old one. What's not to like? Still, we saw a flood of Android tablets being shown at CES... why haven't we seen them yet? Wait, the Xoom is finally hitting the stores... but it seems to be more expensive than the equivalent iPad. What's up with that?

Apple is being clever, that's why. Apple's sneaky strategy is using its $60 billion in cash to buy up displays, forcing other tablet makers to delay release or pay a lot more, thus raising the competition's prices. Apple has reportedly bought up over 60% of all factory capacity for touchscreen displays... and laid out wads of cash (over $4 billion) to do so.

Talk about a win-win... Apple secures production capacity for their projected needs for years ahead, and at the same time forcing competitors to either build new factories, pay significantly higher prices, or accept inferior quality. No wonder the competition doesn't look so good yet.

I expect that Apple will maintain their market share pretty well; they're likely to be constrained more by how many they can build, than by the competition. Android tablets will be here by summer in droves, more than likely (and HP's WebOS tablet, too), just in time for a rumored iPad 3 launch in September or October so Apple can regain the high ground... it's going to be an interesting year.

E-Readers: Apple Vs. Kindle Numbers

Demographics... the very stuff marketing is built upon.

While Apple at least coughs up some numbers of hardware sold at irregular intervals (usually when they're launching a new version), Amazon has always held their Kindle sales numbers close to their vest. They'll hint that they're really happy with the numbers, but they won't actually provide any hard numbers. Here's some data from a third-party source, and it indicates that Apple is beating up the Kindle as far as the UK market goes.

The numbers in the above link are quite interesting, but it's good to remember they are just talking about hardware. UK readers seem to like computers, but then again computers are already everywhere. As dedicated e-readers fall in price, we'll see their numbers shoot up. Kindle for $99 by Christmas, I betcha.

It's not clear how many books are being sold by platform, but I think the Kindle is the big winner still. The new iPad 2, being thinner and lighter, may help shift numbers in their direction. But it's still expensive compared to a Kindle, and price is definitely a factor.

Games Make Less on Ads

In-game ads don't look like this, but it might be kind of cool... especially if I could blow them up.

An interesting study by Mobclix shows that games make less on ads than other types of apps. Their study looked at free apps with over 500,000 downloads and 75,000 active users. Games on iOS generated $4 per user, while games on Android generated $1.90 per user. Compare this to utilities, which generated $9.50 per user on iOS. So games haven't been pulling in the money that they could... perhaps gamers are too busy, you know, gaming to actually click on ads.

Of course, this study didn't look at virtual goods in comparison. But it does show that ad-supported games are generally not as good a solution as other types of apps. Something to think about when you look at monetization options.

Guitar Hero Shut Down... Not Inevitable?

One of the biggest categories of game software over the past few years was music software... until it collapsed. There was an amazing amount of software and hardware sold to go with the Guitar Hero craze. It helped prop up industry sales and mask the shift of revenues to mobile and social gaming. Until it suddenly died... and perhaps it wasn't of natural causes.

This Crunchgear article makes the point that Guitar Hero was a cow that was milked to death by too-frequent new releases, and essentially getting customers to pay for new tracks at premium prices. Eventually the craze ended, or people woke up to the expense, and then Activision decides it's past hope and kills it completely.

Seems to me that with proper management such a franchise could generate revenues for a long time, if you don't abuse the customers. Shows what an obsession with quarterly profits can do, doesn't it? Activision has been busy killing franchises lately (Tony Hawk bit the dust, too), and it's not clear what's going to replace them any time soon. I suppose Blizzard's new releases over the next year will of course be hits. Activision better hope that the new Bungie title is a worthy successor to Halo.

Could Authors Be Liable For Ebooks?

A prototype e-reader by HP.

The recent bankruptcy of Borders has opened a scary question: Can authors be held liable to consumers if an e-bookstore dies? It's really not clear what liabilities authors who self-publish are actually setting themselves up for, later on.

I guess with the amount of money some ebook authors are raking in right now (Joe Konrath is looking at somewhere north of $500,000 in sales for 2011) nobody's really going to be worried about this. But it is something to think about for the future.

iPads Replacing Textbooks

These guys are working on a tablet for education.

This news item from AppleInsider notes that Georgia is looking to put iPads in all of its middle schools, replacing all the textbooks. Other schools are testing this, and it looks like it will be a growing trend. Especially if textbook publishers ever get smart and embrace it, but that may require new publishers. College textbooks can easily run hundreds of dollars per quarter if you buy them new... enough to buy an iPad for one quarter's worth of books is not unusual at all for an engineering major.

Imagine that, once you have your classes, you could go to a page where you could download all your books to your tablet. Better still, how about paying maybe $50 each instead of $100 or more? Perhaps even less if the professors start putting excerpts in there from their own works, instead of full books.

A dream scenario for students, a nightmare scenario for textbook publishers bloated on decades of high prices. They will delay this advance as long as they can, but there's an opportunity for new publishers to step in and make a killing. I hope, for the student's sake, they do so.

And please note that this could mean tens of millions of tablets sold for students... on top of other tablet sales. Want to bet whether those students would be putting games on their tablets?

Mobile Games Grow, Marketing Gets Harder

Here's some fun facts for you: Mobile games will take in more than $11 billion in revenue by 2015. That's about equal to the current take from console software, mind you. Given that console software sales have been shrinking for the last several years, rather than growing, it seems reasonable that mobile game revenues will overtake console games in the not too distant future. (Which kind of makes Activision's strategy of avoiding mobile and social games hard to figure out.)

More data: the majority of the revenue will be from in-app purchases. Though I wonder if advertising won't be close... it's going to be interesting to see how Android revenue numbers change as in-app purchasing takes hold in that market.

The real key to understanding all of this is that discoverability is still a problem. No, it's going to get much, much worse. Marketing gets tougher as time goes on in these crowded markets. We can hope that trusted sources will appear over time that can command a huge following (and thus become a prime place for marketers to advertise or promote), but so far that hasn't happened.

Game Sales Down Again

The 360 still leads... the Wii is hanging in at #2, but that's with a $100 price advantage.

This isn't exactly the way NPD cares to announce it, but game sales continued to drop in February. At least, traditional game sales dropped 8% over last year. Sure, overall sales were up 3%, but to get there you had to add in sales of Kinect and Move which are still doing quite well. If you're just looking at software, the picture continues to be grim.

Hardware sales were up 10%, and the PS3 was up 12%. Happy times for hardware... but software is just not catching up. I'd guess that Xbox Live and PSN are doing a good business in digital sales, which aren't captured by NPD (of course).

NPD tries to put a happy face on things, but I don't think this report should be cause for happy dances in the console games business. Fortunately, mobile, social, and other forms of game revenue continue to do well. NPD intends to report regularly on those things, but so far any of their reports are mostly speculation since digital revenue goes largely unreported in public.

NPD continues to become less relevant as game industry revenue moves more and more online and out of retail stores. What will replace them?

Android Market Gets Real Search

If this thing really works, it could be huge... I'm gonna have to check it out. Chomp promises to be the search tool that Android really needs, that will classify Android apps by really figuring out what it's for rather than just what tags the developer hung on it. (I really hate the fact that all these social games call themselves "RPGs" and make it impossible to find a real RPG on Android or iOS.) We'll see if it amounts to anything... but it sounds like a good idea.

Android Growing

The Android Market clearly skews to free apps.

It's not news that the Android market is growing faster than the iOS market; after all, Android is the #1 smartphone these days, in terms of market share. What's interesting, according to this recently released study, is that the Apple App Store attracted nearly 24,000 developers between August of 2010 and February of 2011. During the same period the Android Market attracted about 4,000 developers. The numbers of developers grew by about the same percentage in both markets; 48% in the Apple market versus 40% in the Android market.

Interestingly, Android developers created an average of 6.6 apps, whereas iOS developers had an average of 4.8 apps. Perhaps this makes up a bit for the smaller number of developers...

Clearly developers prefer the Apple environment, at least so far. Perhaps it's because paid apps are more popular, and developers have found ads aren't yet as lucrative a way to monetize your app. The entire article is worth a look, as it contains more useful information about advertising on both platforms.

Is The Wii A Dead Console?

It's a good question. Although Nintendo seems to think that the release of a Wii in a new color constitutes a major hardware update, consumers don't seem quite as convinced -- nor do analysts. The above chart shows the Wii's market share, which reached its high point in 2008. It started to drift down in 2009, and 2010 saw a steep decline. Early figures from 2011 show more of the same, as the 360 continues to lead the sales charts while the PS3 battles Nintendo for second place. And this is despite the Wii's $100 price advantage... when you factor that out things look quite grim indeed. Unit sales of the Wii fell by 24% in 2010, which should have set alarm bells ringing.

Nintendo seems to be focused on the 3DS launch, which is understandable. (It's not clear right now whether the tragedy in Japan will have any effect on Nintendo's hardware production ability... but I'd guess not.) Still, you'd think the strategy is fairly easy to discern. It's a simple two-step: Step 1 is to reduce the price on the Wii to $149 to goose the sales up and keep third-party developers on board. Step 2 is to introduce a new console. If it's going to take longer than this holiday season to introduce the new console, you may have to repeat Step 1 a few times.

So far Nintendo has been reluctant indeed to reduce their hardware price. It would certainly seem like the time, with sales dropping at a rate of 25% a year or so. Why wait until the 360 reduces its price and makes things more difficult for you? I really don't know why Nintendo hasn't done this; their hardware production costs should be nice and low by now, having had years to cost-reduce the hardware.

Meanwhile, there's been nothing rumored at all about a new version of the Wii. Sure, people have made up wish lists, but it's clear no developers have their mitts on one yet. Speculation ranges from a very minor upgrade (HD output, faster processor) to a full blown new console (new graphics chip, new processor, perhaps some new interface capabilities). I would argue that Nintendo should not go for the high-powered end, but instead should try to have a low retail price with HD output and some interesting capabilities. Why? Because Sony and Microsoft are certainly already competing on horsepower, and they look to continue to do that. Nintendo should stay out of that fight, like they did with the Wii. Besides, with the looming threat of Apple TV and Google TV, the low end is going to be busy. And Apple TV and Google TV are aimed squarely at Nintendo's game consumers. They will be putting out thousands of low-cost or free simple software titles that people can download instantly.

Nintendo's got a real threat to its continued existence here. Microsoft and Sony have the high end cornered, and Apple and Google will be aiming at Nintendo's market. Plus, Nintendo has shown disdain for the idea of online anything, and is only slowly beginning to grasp the idea of an online community, online sales, downloadable content and digital distribution, much less freemium.

I believe Nintendo will announce a successor to the Wii at E3. If they don't, I expect they'll be leaving the home console business... willingly or otherwise.

The Death of Console Gaming?

Well, it's more interesting than the Red Ring of Death.

At least, Rovio's (creator of Angry Birds) Peter Vesterbacka seems to think so. At a panel at SXSW, he said innovation has moved into mobile and social gaming because those companies are more nimble -- they can develop content more quickly. He scoffed at $40 or $50 games for consoles that are difficult to upgrade, and claimed console games are dying.

Well, he does have some good points. The fact that a mobile or social game can be developed in a few months (or even less) is a big advantage or games that take years to make. Not the least of which is that you can make more such games, and thus experiment more. Then again, you certainly don't get the kind of depth of experience in a game that was thrown together in a couple of months.

It's true, though, that console game sales have been in decline the last few years. The top-selling games have hit new heights (like Call of Duty: Black Ops), but the average sales have been declining. I think a good part of the reason is that gamers have more inexpensive or free options for playing games, even if some of those games are less complex or deeply involving. (Though when you look at something like all the free-to-play MMORPGs, or the free-to-play League of Legends, they certainly have equivalent depth to most console titles.)

I don't think the console game market is going away, but it is changing. We will see more experimentation with free-to-play games, and DLC, and lower price points and digital distribution. Some of the types of games people really enjoy will still require years to build, and gamers will pay for those that are good. Companies are going to making fewer of those bets, though, and trying for a higher level of certainty about the payoff before they make those huge bets.

Camel's Nose In The PSN Tent

Free Realms... it's like an online cosplayer convention, I think.

Here's a news tidbit that I filed away, but haven't gotten a chance to comment on yet... Sony has announced the first free-to-play title for the PS3, Free Realms. This is a family-friendly MMO that's done well on the PC, and now it's bringing the freemium monetization model to the PS3. Of course, this would be much more cool if the Playstation Network (PSN) was actually operational right now, but it's still turned off due to a rather nasty intrusion by a hacker. Sony is having to scour their servers to make sure there's no sneaky little code hiding out ready to steal credit card numbers or hack player scores.

It will be interesting to see just how well MMO's can do on consoles, and how well the virtual goods will sell. I'd think the lack of a keyboard would affect the ability to make friends and communicate, but since everything seems to be moving to voice chat anyway perhaps it's not so much of a bother any more.

I do wonder when Xbox Live will take the leap and allow free-to-play, or MMO's for that matter. They risk being left behind when Apple TV and Google TV make the leap to apps in the family room, as you can bet there will be plenty of companies ready to offer free-to-play games on those platforms.

Apple Closes In-App Purchase Loophole

Is this Capcom's insidious device for plucking the cash out of your credit card?

No doubt responding to the flurry of stories in the media about kids running up hundreds or thousands in charges on mom's credit had something to do with this, but Apple has made an important change in iOS 4.3. Previously, you could buy an app, which requires entering your password, and then for the next 15 minutes any purchase on your iOS device does not require a password. So mom would buy, say, The Smurf's Village, then hand the iPad over to Junior, who would find that he could load up on smurfberries and win the game with mom none the wiser... until the credit card bill arrived.

After much wailing, and gnashing of teeth, and rumors of tense conversations between Apple and Capcom, and an FTC investigation, Apple's got a fix in place. When you use iOS 4.3,  you still have a 15-minute window once you enter your password where you can purchase apps without re-entering the password. However, should you try to make an in-app purchase, you'll need to re-enter the password. This simple change should fix the problem in the vast majority of cases.

However, I predict a big drop in the smurfberry futures market. Perhaps Capcom will have to rely on getting more "adult power users" to play The Smurf's Village if they want to keep their revenue numbers up. Wehn you can't steal from unsuspecting small children, it's so much harder to make money.

Will The App Market Close Down To Small Developers?

This game by an 8-year-old was #1 in the iTunes Store... will that ever happen again?

How long will the doors remain open to small developers? That's a question being asked among VCs and developers alike, as venture money has been pouring into social and mobile developers. Big companies like EA are investing heavily in mobile and social games. As this article argues, the influx of big money and big companies could squeeze out the small developers.

Another factor is the increasing influence of pay-per-install networks from companies like Flurry and Tapjoy (the company formerly known as Offerpal, which was known for less than scrupulous deals). You can buy your way onto the bestseller charts if you pay enough, rumored to be up to around $30,000 now. Certainly it's way beyond the means of a small developer.

I agree to a certain extent with this theory. Certainly we'll see bigger developers, or those with venture money, perhaps investing more in the development of individual mobile titles than was previously seen. Then again, if higher investments in development don't tend to produce correspondingly higher revenues, that practice won't continue for too long. And just raw volumes of artwork aren't enough to make the difference in smartphone games. Few titles are designed for large quantities of artwork on smartphones, anyway; that's not the type of game experience people are looking for in a smartphone, at least not so far.

I think the big difference for smartphone games is that distribution will continue to be non-capital intensive. Regardless of how much you spent on development, distributing your game costs nothing. A venture-funded developer or a big publisher may be able to put large amounts of money into marketing (or a license, which has a similar effect), but the small developer can at least get their product on the shelves.

I think more money will tend to mean the top seller lists will be dominated by big companies or venture-funded developers, but the smaller developers will still be able to break through with a great title and some clever marketing.

Small Developers, Big Games

I'd like to highlight one of the cool games I saw at GDC, which is coming out March 15th on the Playstation Network: Slam Bolt Scrappers from Firehose Games. It's a fine example of how a small team can turn out a fun game that's quite capable of keeping up with the big guys. It reminds me a lot of Super Smash Brothers, but Slam Bolt Scrappers has a co-op play mode as well as a competitive mode, and it has a nice strategic component as well. The combination means you'll be playing it for quite a while, especially with the fun animation and sounds. You can see for yourself with the trailer above; check out their website too.

When small teams can produce games of this quality and get them distributed via PSN or other major platforms, it's a great thing for the industry. The big challenge is marketing, and finding enough players. Fortunately, with digital distribution the game's lifespan is orders of magnitude better than what it would be as a boxed retail product. If this game was in GameStop, you'd have to get it in the first month after release because you'd likely never see it after that. Stores only stock the latest releases, unless it's one of a handful of best-sellers or a used title. Digitally distributed titles last as long as you care to keep putting effort into marketing them, and if it takes a few months to find an audience it doesn't hurt (except for a few months of nailbiting for the developers, that is).

If you've got a PS3, check out this game. It's fun, and it's a taste of the best part of the gaming industry.

Angry Birds, Happy Company

That's some tasty game sales.

I know a number of industry veterans have looked down on the smartphone game market. They say things like this: "Sure, there's lots of smartphones out there. But games are mostly free or only a few dollars! Maybe we'll sell a lot fewer copies of a title for the DS, but at least we can charge $30 for it. We'll never see that kind of money from a smartphone game!"

Well, unless you're Nintendo, the best you can hope for on a DS game is about 5 million units (Dragon Quest IX). Which, assuming a retail price of $30 and the publisher makes 30% of retail, means about $45 million in revenue. A DS game would cost somewhere in the realm of $250,000 to create (although some cost less; new games for the 3DS and the Sony NGP are going to be more in the $1 million cost range or more). So that's a pretty good return, right? Let's see a smartphone game do better than that!

OK, here's the info on Angry Birds. The game cost Rovio about $140,000 to create, and to date has brought in $70 million. Yeah, you read that right. Rovio is making $975,000 a month just from the free-to-play Android version of the game, and about that much from the cuddly toys. OK, they do say that 40% of the Angry Birds revenue comes from non-game sources like licensing and merchandising. But that still means that the game revenue is about equal to the best-selling thirdparty DS game ever, and Angry Birds is nowhere near finsihed generating revenue, thank you very much.

What about the best-selling Nintendo handheld game? New Super Mario Bros. has sold 26 million copies, so it's roughly in the $250 million dollar revenue range. Angry Birds isn't there yet, but give it a couple of years.

This should make executives wake up and smell the opportunity, or the danger. Revenues from smartphone games will likely exceed revenues from handheld games this year, and the gap will just widen in the future. Sure, there are thousands of smartphone games that never sell very many copies and never make money. But large game publishers should know how to make games that sell, and how to sell them... at least, you'd like to think so. And Rovio was not a large company when they created Angry Birds, even though now they are up to 40 employees.

This is a huge opportunity for smaller developers, if they can figure out how to make a great game and let the world know about it. Don't let anybody tell you smartphone games will never amount to anything. Maybe that's true of most of them, but certainly not all.

The Playbook

RIM has a need for speed in bringing this to market... time's a-wastin'.

With a name like that, it has to be for games... right? And yet it's from RIM, makers of the Blackberry. Who are busily losing market share as Android and iOS eat their lunch. But they were at GDC, with a large booth, trying to entice developers to create games for the Playbook.

I got my hands on a Playbook at the show, and it was impressive. Kind of small, compared to an iPad, but zippy game performance with high-quality graphics (at least, Need For Speed looked good and played well). True multitasking with no apparent slowdown, although when asked about battery life (especially with all sorts of apps running) the rep was suddenly extremely vague.

They were trying hard, though, offering a free Playbook if you could get your app up and running before March 15th. Seems like a pretty short time frame even if you already had an app done for iOS or Android... but perhaps they have some amazing development tools.

Still no announcement of price point or release date, and that's why it's hard to judge how well the Playbook might do. If it's $399... it could do well. At $699, the iPad 2 looks like a far better deal. Hanging over the whole thing, though, is the shadow of the development environment. Will developers really want to spend time and effort on yet another platform, when iOS and Android already have such a large base?

Which is where this story takes an interesting twist... according to this rumor from Bloomberg via TechCrunch, the Playbook will run Android apps. More than that, supposedly they are porting their Blackberry Messenger to Android (that's the crown jewels of RIM's empire).

Seems to me if RIM did this, the battle for developers would be over... who would develop specifically for Blackberry when they could get it just by doing an Android app? Nobody, especially when you hear just how messed up their developer program is (it's worth a read). Of course, if RIM still insists that the Playbook can't do email without being connected to a Blackberry, this is all academic. No one except a Blackberry owner will even consider getting a Playbook, and I bet damn few Blackberry owners would buy a crippled device.

Still, RIM is working hard to get games on the Playbook. Which is puzzling, unless they really feel they can sell it to everyone, not just Blackberry owners. Look, Blackberry is dying; their hardware just isn't competitive with iPhones or Android phones. Maybe the email is a little better, but that's not enough to overcome all the other advantages. Now RIM has to decide if they are a hardware company or a software company, and step up their game. Half-measures won't cut it when you're facing an existential threat, which is the situation they are in if you look at their market share numbers over the past year. Nokia realized they had to do something dramatic, and they did just that by embracing Windows Phone 7. RIM either needs to pull dramatically better hardware out of nowhere, or team up with a winner. Android seems like the obvious choice; RIM could embrace Android and say "We have the very best phone for business, and tablets for business or fun, too."

But time grows short for them. If we don't see something dramatic from RIM this year, I think it will be too late.

Android #1, Beating Blackberry and Apple

At this rate, RIM is going to be battling Microsoft for the bottom of chart very soon.

Looks like it's finally happened... Android has grabbed the #1 slot in market share for the USA. They managed to pass up iOS in November, and now that RIM is helping out by losing big chunks of market share for Blackberry, Android is in first place.

I'd expect Apple to do well in the next report, given the introduction of the iPhone to Verizon. Apple's choices for new product intros this year will be very important; will they announce just a spiffier iPhone, or also one that's designed to hit a lower price point? There's no doubt Apple will do well with a more powerful iPhone, but if they want to catch up to Android they're going to have to address the lower end of the market.

Apple has done that before, though. The initial iPod was very expensive, and it took years before Apple covered a full range of price points. In the process, though, they kept their profits and their market share high. Can they pull that off again?

Meanwhile, Android will continue to have many new devices introduced this year. Which is a problem, as it means the hardware base will continue to fragment, making things tougher for developers. No one really wants to test their games on a dozen or two dozen or three dozen handsets.... but that's where we're headed in the Android market. Unless you keep the system requirements at a fairly low level, which means your game won't be looking as good as an iOS game. It's a tough set of decisions.

It does show how far Windows Phone 7 will have to climb, though. Nokia better get some phones out soon, and one hell of a lot of them.

Mobile Games Changing The Market

Some interesting information on the demographics of mobile gamers comes from a recent study by Flurry (they provide analytics to mobile games). They looked at more than 60,000 users who play mobile social games (which means games ranging from EA's Pogo lineup to Words With Friends to Farmville), and here's some of what they found.

Mobile social gamers average 28 years old, about six years younger than console or PC gamers, and women make up 53% of the audience. There's a lot more data presented in the study, and it's worth a look if you're developing mobile social games.

It's still tough to get found, but at least social games have a built-in marketing mechanism where players tend to rope in more players. Of course, for that to work really well you have to have lots of players... which is the classic chicken-egg problem. If you can make it to a certain size, though, your audience will start to grow nicely of its own marketing.

GigaOm has some interesting thoughts on the meaning of this to advertisers and developers. It's a different demographic than traditional games, so it's a good place for advertisers to find consumers they don't reach with other games on other platforms. Best of all, mobile social gamers tend to have a lot of money and aren't adverse at all to spending it on virtual goods.

I do love Flurry and other analytics firms. Back in the stone age of game marketing (i.e., the 1980's) we just had to guess at demographics. Now we can get huge piles of data, and the problem has shifted to one of proper analysis of the data. You have to know enough to ask the right questions, and then know what to do with the answers. It's an exciting time, though, to be a marketer.

GDC 2011: Reviewing Marketing Efforts

The new THQ logo...seems vaguely wrong, but not as wrong as their handouts.

Part of my trade show post-mortem process is to sort through all of the marketing materials I collect, and analyze them for effectiveness. Sometimes I get useful ideas on presentation, or find new tchotchkes that are cool, or new ways of presenting information. As I go through my collection, I thought it would be useful and interesting to my readers to share my analysis.

Cubic. I picked up some info from Cubic, a company developing military simulations. They were in the Career Pavilion, looking for programmers. What attracted me was a picture: A Humvee surrounded by screens. So I gathered flyers... the one that caught my eye was an Engagement Skills Trainer, which is basically a Humvee on jacks surrounded by screens, with all sorts of sensors.You can implement all sorts of additional sensors to deal with a variety of training. I'm sure it's expensive, but cheaper than field operations with less chance of getting hurt. Their flyers were high-quality, heavy stock printing. The most interesting piece was the size of a business card... it was two die-cut cards with a folded flyer glued in between them. It looked like a thick business card, but you can pick it up and pull it open to see the 4-color information double-sided, and easily push it closed again. An interesting and different way to present information portably.

Shanda Games. As a contrast to the presentation of Handseeing  Information Technology, Shanda Games has a reasonably professional booklet (though I'm still not sure what "2,300 Full time stuffs" means). I guess for a company that took in $680 million in 2010, they can afford to drop a bundle on a 4-booth display. While they are looking for staff (full time stuffs?), I think the primary purpose of their booth is to look for strategic partnerships. How do I know this? It's stated in their handout. It's good practice to make sure your marketing materials are utterly clear on exactly what it is you want. Don't assume everyone knows you and why you are at a show and what you are trying to do.

hi5. This is a social network focussed on entertainment and gaming, and they say they're a top 20 web site globally with 50 million monthly visitors. They're eager to sign up game developers to create games for their portal, and they share ad revenues with you, help get your game noticed, and provide monetization services as well (for those all-important in-game purchases). That's all good... and they had a table at GDC where they were promoting some of their developer initiatives. Here's where I see a problem: They call their program for increasing user acquisition SocioPath. I'm sure someone thought that was very clever and memorable (sure, I'm blogging about it, look, publicity!). Edgy, yes, but when you're promoting games targeted at a youth market, might there be some people who would find this offensive?

Vitraya. This one's not ready for primetime, but I think it has potential. Essentially, they are creating a location-aware networking application for smartphones. So if, say, you want to connect with a savvy marketing guy at a conference you're attending, you can plug that into your app and you'll see exactly where he is at the show (assuming he's authorized such tracking), and then can message him or I guess just navigate to where he is. (Hmm, might be awkward if someone ends up standing outside your stall asking if they can talk to you...) It's still under construction, but I'll be keeping an eye on it. It's not game-industry specific, of course, but will be useful for anyone who does the trade-show thing.

THQ. Here's a big company that takes out a booth in the Career Pavilion looking for programmers and artists... and what's the handout? A really poor photocopy with a misaligned world map on one side (with their funky new logo) and a grainy spreadsheet on the other side with little Xs showing which positions are needed in which cities. You're THQ and you can't afford a good-quality copy? Or even a tiny bit of prep work to print (or quick-print) a 4-color handout? Send somebody out to Kinko's before the Expo opens to get a far better quality printout? The marketing message here is "Come work for us, we're really chintzy, unprofessional and unprepared!" I guess it makes sense that one of their open reqs is for a Director of Marketing North America. Hope they find someone who can help with their trade show efforts.

More reviews tomorrow...

Markets In Translation

This carrying bag was handed out at GDC... I saw no hard meet in the vicinity.

Sometimes you may be tempted to use Google Translate to handle translating your marketing documents into another language. Resist that temptation. Your cousin's sister-in-law took a class in that language you need? Don't have them translate your copy.

This fine example was provided by Handseeing Information Technology, which it will no doubt surprise you to learn is from mainland China. They had a booth at GDC, and of course I picked up their information packet... once I saw the bag pictured above, I was hooked. Their marketing's working! I'm blogging about it, spreading the word about their... what are their products, exactly?

Ah, they have some flyers here in their packet. One is for Lost, "The Best Web Game You Can't Miss In 2011". Great name for a game; it might make a cool title for a TV show someday. Here's the flyer so you can see for yourself that, in the immortal words of Dave Barry, I am not making this up.

Would you rather have the super blow feeling or the perfect hand feeling? Tough choices...

Note the strong selling points, whose meaning comes tantalizingly close to understandable: High interacting partnership developing system, Attribution and conflict. I feel like I've entered a different reality already. Nice artwork, though.

There are other flyers in the packet... I can't even make out the name of one, but it appears to be a MMORPG. My favorite feature: "Fantasy task and strong camp against setting let you fondle admiringly." Sounds like fun to me! Try that in WoW and you'll get your account banned for sure.

You might ask what they are doing at GDC. Looking for employees, perhaps; there are a number of job openings listed on their web site (which is where Google Translate does help out, so at least I can get the gist of what is posted). Though are they really going to find people in San Francisco who will want to move to China and work? Maybe they are intent on bringing their games to the US market... but if that's what they are looking for, you'd think they would post a big sign to that effect.

Lesson for marketers: When you're going to a country where they speak another language, spend the money to get a high-quality, culturally competent translation of your marketing materials. Consult with someone from that country about how to present your company. If you can't afford that, don't bother going to that country. You'll just waste your money as much as these guys did.

Otherwise, you may have a good game, but a hard meet. And wouldn't you rather Let Fun AnyWhere? I know I would.

GDC Day 5

The finale...

An interesting round table with Dan Greenberg and the Anti-Censorship SIG of the IGDA. Some things have been happening... like the ESRB realizing that, holy cow, there's all these mobile and social games that aren't rated by us! By golly, we need to get their money... I mean, rate their products to protect the public! At the same time, as games get global distribution with the click of a mouse, most developers aren't aware of all the different rating systems and regulations in different countries. Australia? Yeah, they're getting really weird Down Under. Dan is starting up a Facebook group, and working on a way to get information about ratings to all interested parties. This is definitely something to be aware of if you're making any kind of electronic game.

I did manage to figure out why some of these game companies are at GDC: they are looking for employees. OK, I get that... but do you really need 4 spaces and an enormous temple-like set-up, free t-shirts and fans and other tchtochkes to attract people for the half-dozen or fewer positions you have? Like they're going to move to China instead of, say, Seattle? Either these companies have more dollars than sense, or they are international pharmaceutical dealers.

Many middleware vendors are promising multiplatform output... write once, push a button and you'll have your software on everything more complicated than a toaster. Hmmm... seems like there's more to multiplatform development than that. Could the marketing guys be overpromising? Do programmers like Doritos?

Since it's the end of a long show and I'm feeling a bit crabby, allow me to vent a little about booth design. I walked by far too many booths where it was not immediately obvious to me what they were selling. Your graphic designer may have told you that the dramatic black backdrop with just your company name was eye-catching, but someone should have told you that not everyone knows who the hell you are or why they should stop and find out. A simple subhead can solve these problems... "A global payment solution that gives you 200 countries to make money from" or "Motion capture cheaper and better than anything else" or some such. At least give me a clue so I know whether I should even waste time asking you what you do. If you don't, you're wasting my time and your money. Double bad.

More detailed thoughts later, after recovery.

GDC Day 4

The most popular way to get attendees to visit a booth at GDC.

Today was a day for the Expo... in between meetings and random encounters. And missing some of the people I was hoping to find... but they'll turn up sooner or later. The Expo was an intense experience, with crowds of people, brightly colored booths with billions of polygons and technology oozing from every port. Here's some impressions of what I saw today:

The Nintendo 3DS. I finally got a chance to play with a 3DS and see some of the titles coming up for it. A very nice 3D effect without glasses... as long as you keep your eyes in the sweet spot. The movie clip produced a good 3D effect. I tried a couple of the built-in Augmented Reality (AR) games, which used the 3DS cameras to view a card on the desktop to create a dragon that you could shoot at by moving the 3DS around and pressing the button. Another game took a picture of your face and mapped it onto targets... rather disturbing I think.

Overall, the 3DS felt heavier than a DSi, and the controls seemed sturdy. The 3D effect worked well, but after playing for 15 minutes I found I had a headache. I think it's a nice device, but I am still unconvinced that the market will embrace the device the way it embraced the DS. There are some significant limitations, such as the battery life (3-5 hours versus 15 or more), the $250 price tag, the high cost of the games ($40 or more) and the still-feeble embrace of digital distribution and its possibilities. In a market where smartphones will be selling in the hundreds of millions, the 3DS will  be lucky to achieve a significant fraction of their market share.

What could Nintendo do better? I'd say bring down the price to $199, and embrace digital distribution for a wide range of price points. Open it up to developers and a wide variety of apps. I's screens would still be far lower resolution than a smartphone, but at least it wouldn't have such a glaring disadvantage in software distribution.

The Sony Xperia Play. In stark contrast to the 3DS is the new "Playstation Phone" from Sony Ericsson. I had seen pictures, and it looked pretty cool... but holding it you're struck by how incredibly thin and light it is. And speedy... with a gorgeous screen. Android powered, and a set of Playstation games included, with more on the way. Makes the 3DS look clunky and underpowered and kinda ugly. Frankly, I'm not enamored of 3D. Nintendo's tried to make it important as a gameplay element, but it's unclear how many games will really do that. And the headaches may be more prevalent than Nintendo would like. The Xperia Play is a worthy phone to carry, and a great gaming device.

Middleware, Payments, Cloud Computing... All of these had multiple booths for a variety of vendors. I took a variety of literature, but really reporting on these things will require some review. There seems to be more ways than ever to get paid for your games, and to have your games hosted, and to have various sorts of services connected to your games. The part that I really don't understand is booths seemingly devoted to obscure Chinese MMOs. Other other foreing games... why have a booth at GDC? What do they hope to gain? I'll try to find out tomorrow, because I'm curious.

One interesting note: The most popular prize for giveaways at booths seems to be an iPad... with a few bold booths offering an iPad 2. Of course, they're only giving away one to a booth... but there are a half dozen booths where you can find this offer. Interesting that they would presume attendees at GDC to be interested in this item... and I think they're right.

Right now I want to spend some time watching the League of Legends tournament being staged for the GDC Conference Associates... my son is competing. More tomorrow.

GDC Day 3

It's been a long day, as tens of thousands of attendees descend on the Moscone Center. Some interesting data from today's sessions...

Digital Overtakes Analog Distribution. It's happening fast, and sometime this year or next digital distribution of games will amount to more than all the games sold in retail stores. Unfortunately, not all of the old-line publishers seem to have gotten the memo. As Colin Sebastian from Lazard Capital Markets admitted to me, some executives say they understand... but that isn't the way they're spending their money. Hey, well, more business for the rest of us who can see what's happening and don't have the legacy structures to unravel.

Nintendo Still Doesn't Get It. Sad to say, Iwata-san is still complaining about how those cheap games on smartphones devalue real games, and not actually doing anything about it. I think Nintendo's strategy is basically to hope their business recovers because all of those mobile and social games are just a bad dream and someday everyone will wake up and go back to paying $40 for every game. The whole mobile/social explosion is hitting Nintendo especially hard, as they've always been more focussed on less intense gamers. Nintendo announced a few things... a deal with Netflix for streaming movies on the 3DS, free WiFi through AT&T... but nothing that fundamentally changes the market picture for them. Reality: Nintendo may sell 10 or 20 million 3DS units this year... while Apple and Google sell 200 million smartphones or more. And perhaps 100 million tablets on top of that. And then there's Apple TV and Google TV...

Apple TV and Google TV Hit This Year. Colin Sebastian, for one, agrees with me that this is the year Apps hit TV sets, and the impact will be similar to one about 65 million years ago. Similarly, a number of dinosaurs will perish, unable to adapt to the new environment. You think Nintendo's having trouble now, where's the Wii gonna fit in when you can get thousands of games for free on your TV?

The Expo Is... Crowded. All I had time for today was a fast stroll just to take in the atmosphere... which was mostly focussed around the Career Pavilion, but still big crowds everywhere. The basic company booth was MXLPTK, the unpronounceable futuristic name that produces high CPM shaded polygons with a mobile payment system that automatically captures your motions with optimized code. Or something like that, I think. Perhaps I have one or two companies mooshed together. It's been a long day.

Ebook Sales: Numbers That Will Make Your Eyes Pop

I've been writing about how the whole ebook market has undergone massive acceleration in the past year, and if you want some hard data, look no further than this post. Amanda Hocking, a 26 year old writer who has never had a traditionally published novel, is selling excess of 100,000 ebooks a month. In January, she sold 450,000 ebooks. OK, yeah, they were only $3 apiece, and she only gets 70% of that... even if you can't do the math in your head you can tell it's a pretty good sum ( yeah, almost a million dollars in January... what will she do the rest of the year?).

Here's what one publisher said: "There's no publisher in the world who can offer her better terms than she's getting on the Kindle store all on her own."

OK, maybe if you've got an offer on the table for a $200,000 advance for your novel, maybe you should take it. And maybe not... and if you're sitting on a novel that's been making the rounds for months or years, why the hell aren't you putting it on the ebook market and making some money right now?

The ebook revolution is just getting started... we have just seen the beginning.

I know I'm getting my novels moving... no need to worry about a publisher, I just need to write some novels and make sure they're good. (Not an easy task by any means... but when I have those it's just a few short steps to market).

GDC Day 2

The second day of the GDC is really the day before the real conference... right now there are only 3 or 4 thousand attendees, and tomorrow the number will be closer to 20,000. The first two days are summits and tutorials, with "summits" being mini-conferences on such topics as AI, Education, Social & Online, Smartphone, Independent Games, Serious Games and Localization. It's kind of odd that the fastest growing market segments (smartphone and social games) are relegated to a smaller footprint, but I guess it would just be overwhelming to include those specific topics in the myriad other tracks competing for attention during the next three days.

I attended an interesting session on emerging technologies today, which was discussing the ways being created to bring higher-powered gaming to browsers. Adobe's Molehill project will give developers access to the GPU for accelerating 3D performance with a browser... speeding up things by an order of magnitude or two (check out the videos on that link). Facebook has been working on seeing just how fast they can get Facebook games to perform, with some impressive results. And Mozilla has been working on a version of OpenGL called WebGL, hoping they can provide a universal solution to fast browser performance for games.

I'm not sure what technology will wint out here, but it's clear that browser game performance on desktops, tablets, and smartphones is going to take a big leap forward in the next year. Which is good news for game developers looking to bring some more graphic buzz to their games that can work on a very wide array of devices.

Most of the day, though, was spent renewing old contacts and having new discussions. Lunch with Warren Spector was fun, as was chatting with Eric Goldberg about old times in the game business. There will be a lot fo things to follow up on after the show...as is usually the case.

One thing I have learned, though, is to make sure next year to be there for Google's first seminars... attendees were given laptops running ChromeOS, Motorola Xoom tablets or Nexus S smartphones... wow. Nothing like encouraging developers to attend your seminars!

BREAKING: Panasonic's "The Jungle" Clearcut

The handheld that will never be.

Shocking news announced today: Panasonic has cancelled its hugely anticipated handheld MMO gaming device, "The Jungle." Yes, it's hard to believe given the overwhelming worldwide interest in Panasonic's offering, which I detailed in this post. OK, I did call it "The Fiasco", which turns out to be prescient. Amazing... what a stunning prediction. I mean, if you compare the stats of The Jungle to the 3DS and the NGP... wait, Panasonic never did announce any stats, did they? Or a price, or a launch date, or any reason at all to be enthusiastic.

At least it's a great lesson on how not to announce a product. Or develop one. I sure hope someone at Panasonic lost their job over this massive waste of company resources on a project that anyone with even a passing familiarity with the game market could have told them was a bad idea.

Well, Nintendo and Sony can breathe a little easier now that The Jungle isn't a threat.

Android In-App Payments Launch Set

Where you will find in-app payments for Android.

Finally, Google is set to launch in-app payments for Android. About frickin' time, say developers who have seen all the money coming to iOS products even though Android phones are selling better. Yeah, there are solutions from PayPal and others, but there's nothing like having something baked right into the system.

The launch looks to occur in May, probably rolled out in a big way at Google's developers conference (Google I/O) which is scheduled for May 10-11.

Games will be leading the charge at taking advantage of this, of course. Given that in-app payments make up more than half the revenue for Apple's iPhones, it stands to reason it should do reasonably well on Android. Maybe Android revenues will begin to amount to more than 1/20 of iOS revenues... can we go for 1/10?

Angry Birds Not the Only Ones Angry

Portrait of a physics engine creator?

I wasn't there, but TechCrunch reports an awkward moment at a GDC talk yesterday. While Rovio's CEO Peter Vesterbacka was giving a talk about Angry Birds, a guy stood up during the Q&A session and asked for credit in the game for his physics engine. Seems that Erin Catto did indeed create the engine Rovio used, and while by his own terms they didn't need to credit him (foolish terms, if you ask me), he is miffed they didn't.

Sounds like Rovio will be talking to him about this... they should at least give him some credit, if not a little financial appreciation given the level of success Angry Birds has achieved.