Will the Wii U Succeed?

The success of the Wii U is an important question not only for Nintendo, but for the video game industry in general. Publishers are suffering from the decline of retail video game sales; only the best AAA titles make a return on their investment these days, and as a consequence publishers have mostly stopped producing anything but games they think have a good shot at AAA status. Everyone's looking to next-gen consoles to save the day and return sales to the fabled days of yore... or at least stop the continuing double-digit slide every year.

The Wii U is (in some views) the first of the next-gen consoles. Really, though, it's technically on par with the 360 and the PS3. Many of the launch games are noticeably worse than their PS3 or Xbox 360 versions, though that may be due to unfamiliarity with the new console. Still, no one seems to think the Wii U is a step up in power from the Xbox 360 or the PS3. It is, however, significantly more expensive; $299 for the base 8 GB model Wii U compared to the current deals of $199 for a PS3 or Xbox 360 with a 250 GB hard drive and several games.

I look at the potential Wii U audience as falling into two categories. The first is the audience that already has a PS3 or an Xbox 360. For them there's little reason to buy a Wii U. Until there's a compelling game, like a new Zelda game, any important new game is going to appear on the PS3 or the 360 for sure, and probably look better. Until the Wii U gets several compelling new games with gameplay you can't get anywhere else, I don't expect many sales from PS3 or 360 owners.

Then there's the audience of people who don't own a 360 or a PS3. They either have a Wii only, or no console at all. Maybe they have child who's just now getting old enough to want something they can play games on. That's an even tougher market for Nintendo to capture, because the competition is fierce. Great deals abound the 360 and the PS3; they are at least $100 less, come with several games, and there are hundreds of games available at very reasonable prices (especially classics and used games). Or there's a wide array of tablets like the Kindle Fire, the Kindle Fire HD, the Nexus 7 or the iPad Mini. They all are cheaper than the Wii U, have thousands of free or low cost games, can be used to surf the web, read books, watch movies, or a zillion other things, and are completely portable with better looking screens than the Wii U.

I noticed a disturbing thing looking through the Sunday ads; both Target and Toys R Us were offering deals on Wii U software. Toys R Us is offering 40% off your second Wii U title if you buy one at full price; Target is offering 50% a Wii U title if you buy two at full price. Not the greatest deals, perhaps, when titles are mostly $60. But I have never before seen sales offered on software at the time of a console launch. To me, that says that Target and Toys R Us are not convinced that the Wii U will be able sell all the software possible. Or that Target and Toys R Us are concerned that people may buy their Wii Us at other stores, so they need to attract those buyers.

If Target and Toys R Us were convinced that Wii U's be selling out, there would be no need to offer software deals to attract buyers. Buyers would be scouring all the stores looking for Wii Us. Toys R Us and Target must also be concerned that not all of this Wii U launch software is going to sell, so they are looking for ways to move that inventory. The fact that this is occurring in advance of the console being offered for sale is most disturbing; Toys R Us and Target aren't even waiting to see how sales go before cutting into their profits. (These deals are coming out of the store's margins, and it means they won't be making any profit on those game sales. Why do it? To move some hardware, which they do make money on, and to prevent that hardware from selling somewhere else.)

The important thing to keep an eye on is whether store actually run out of Wii U's, and if they do whether customers actually care or not. I suspect at this price, and with Nintendo probably providing more units than the Wii at launch, that we won't see shortages, or if we do they will just be Nintendo manipulating the supply a bit. I expect the Wii U will see sales grind to a halt in a couple of months, waiting for more compelling software (if it ever arrives) and a price cut to make it more appealing.

Then the even bigger challenge comes next fall, if there's a new Xbox and PS3. Those will certainly have a significant graphics advantage over the Wii U. Their price may not be much higher... or it might even be lower, if rumors of a subscription-subsidized console come true (think of the effective pricing of smartphones, which are subsidized because of the telcos). At that point the Wii U will need to dramatically lower the price, if it hasn't done so before then. Don't think Microsoft and Sony are going to ignore Nintendo when they think about the pricing of their new consoles. They would love to see the console market get less competitive, and if they can kneecap Nintendo they will do it in a heartbeat.

2013 is going to be an epic battleground for the future of the dedicated game console.

Call of Duty Black Ops II: Targeted Marketing

Her'es a great example of a company that knows its target market well: It's Target. Their Sunday ad had a wraparound section, and on the front was this image:

The special section is pushing the arrival of Activision's Call of Duty: Black Ops II (or, as I like to call it CODBlOps II), and in case you don't have one, an HDTV screen to go with it. Inside the flyer pushes more TV screens and hardware you might want to buy. The back, though, is a revelation:

Yes, it's got all the major gamer food groups covered, from pizza to Monsters. Ready for your all-night CODBlOps session? You will be after you chow down on these specials. Yeah, they know their market, and they're going to generate some nice additional sales because of it.

How Much Do Apps Make?

Here's some interesting data on exactly how much the top-grossing apps make. Since normally it's impossible to get any specific data on this from the companies involved, this data is derived from several statements by a former BioWare San Francisco producer. The key table is shown above, and you can find the blog post where he explains his methodology here.

As you can see, the top app stands to make a healthy amount of money every day it's in the #1 spot, grossing over $250,000 dollars. Not bad for one day. The reality, though, is that the fall-off from the top spot is quite fast. The author of the blog post assumed that the #100 app would earn about $3000 per day, which is still not too bad.

The reality is that the vast majority of apps earn very little. Success in the App Store is based on luck, skill at game design, and having a good hook -- fame for another reason, something about the game that connects to something hugely popular, an unusual game mechanic, setting, technology, or twist that gets the app noticed and word of it spread virally. There's no standard recipe for being a success, more's the pity.

I continue to believe that making a successful app is an exercise in patience as much as anything else. Line up all the positive factors you can for the app, but be ready to try and try again. Perhaps repeated updates and new content and user feedback can turn a so-so app into a successful one. Or just improve your odds by creating multiple apps. But in any case, try to have as many advantages as you can for your app. If the app is similar to half a dozen other apps, you're going to have a tough time getting any downloads unless you have some other reason for people to try your app (You're famous? Justin Beiber likes your app? You're ready to spend millions on user acquisition? An award-winning artist designed the graphics? You have to have some reason that people will want this app),

Wii U's Rough Marketing

The Wii U television advertising has begun, at least in the UK. The ad above (or, as they say across the pond, the 'advert')  is the first effort.

I felt like I was watching an infomercial; I kept waiting for the "act now and you get an extra controller free!" part. The controller apparently can reveal things that are hidden; perhaps it can find the excitement in the commercial, because I sure couldn't find it. The ability for someone to watch the TV while I play a game... that's really a major reason to buy this console?

It actually made games look like more work. I can't just look at the screen and press buttons, I have to hold the controller just so, while keeping my attention on the big screen, and then rapidly brush my hand across the top of the Gamepad to fire the ninja stars, while aiming at the onscreen target. Great, way to break me out of the sense I'm immersed in the game. Or I have to hold up the Gamepad and wave it all over the room to find stuff; my arms are going to get tired if I have to do that for hours. Fortunately I think the battery in the Gamepad only lasts for a couple of hours, so I guess that solves that little problem.

I think the Wii U has a rough marketing road ahead of it. The Wii was a smash hit, for two main reasons: It had a new controller and interface that was so easy to use Grandma could do it, and it was half the price of the competing consoles (PS3 and Xbox 360). Compare that to the Wii U: It's more expensive than the PS3 and the Xbox 360, the graphics aren't any better, and the controller is even more complicated. Hand the Gamepad to Grandma and see what she says... how many buttons are on this thing? Which screen do you look at when? Switching attention back and forth between the TV and the Gamepad not only breaks you out of the game's immersion, it's going to cause a headache.

I think fanboys will buy the initial units, but I think the sales curve will resemble the 3DS: Initial big sell-in, then it sits for months until Nintendo drops the price dramatically and some software that's really interesting finally comes out.

Slick Marketing

In a world where marketing is no longer cut and dried, creative marketing can be a valuable tool for breaking through. This video showcases some clever event marketing turned viral video for the upcoming Bond film Skyfall, as well as Coke Zero. People were looking for some tickets to a showing of the movie, and found they had to work to get them. The result is a video that nearly everyone will enjoy watching.

Why is it effective? It's compelling enough that you want to show it to friends. The clever use of the Bond theme with a variety of nearby musicians, the obstacles, and even the final challenge -- all were amusing and very well executed.

The whole event took place in a Belgian transit center, and obviously it required a lot of planning to set up, as well as no small expense. What does Skyfall get out of it? LOts of exposure if enough people pass around the video. Will views translate into people watching the movie? Perhaps, but at least they've increased awareness of the movie release. Measuring that precisely will be difficult, of course.

How can this be replicated? I think the major lesson here is to be creative. Of course they had a good-sized budget to work with, but much can be done with some friends and a lot of creative thinking. 

Microsoft Surface To Submerge

Microsoft has finally announced the pricing of the Surface with Windows RT tablet: it starts at $499, without the keyboard cover. Oh, you wanted the keyboard cover? $599. $499 gets you a 10.6", 1366 x 768 screen, Tegra T30 chip with 2 GB of system RAM and 32 GB of storage. What's wrong with this picture? It's up against the iPad at the same price point, with a far higher resolution screen and an unmatched library of apps.

Microsoft needed to get a solid hardware base in order to attract app developers, and there's really only two ways to do that in a marketplace where Apple has around 75% market share. Either you make a stunningly better device at the same price, or you deliver a pretty good device at a much lower price. Microsoft's Surface, while a nicely designed piece of hardware, is not clearly superior to the iPad (and is arguably weaker, with a screen of far less resolution and a slower processor). Microsoft really needed to bite the bullet and price the base model tablet at $299 or less.

Lose money on every unit? Are you crazy? Like a fox. That's exactly how Microsoft made a bundle on the Xbox 360; they were willing to lose hundreds of dollars on each unit sold for years. Now they're raking in huge profits, because every game developer is supporting their platform. Why? Because there's a huge installed base now. The same strategy could work for the Surface, but now we can see that Microsoft is not planning to lose a billion or two selling Surface tablets at a loss.

Microsoft must be counting on the inherent fan appeal of Windows (huh?), and of course the spill-over effect of the incredibly successful Windows Phone (if only) to drive Surface tablet sales. Really. Of course, the elegant, crystalline clear naming strategy (Surface for Windows RT... and don't confuse that with Surface for Windows Pro, because thought they have a similar interface they don't run the same software.... unless it's been written that way... and make sure you buy the right one!) and compelling marketing (TV ads showing people dancing will of course make people want to buy this tablet) means that Microsoft won't have to resort to anything as crass as bribing people to buy their tablets.

Uh huh.

Let's not forget about the gaming possibilities.. Wait, I guess Microsoft did, because I see no mention of gaming anywhere in their PR. Who cares, it's only the largest app category on mobile devices. Besides, gamers wouldn't be buying tablets this expensive just to game on anyway. See? Problem solved!

It's kind of sad, really. Microsoft used to have some tech savvy, and some mojo. They are trying; the hardware design of the Surface looks interesting, and the Windows 'Metro' interface (which for some reason can't be called that any more, and there is no other name... more marketing genius) has won kudos. That's all not enough. Apple and Google own the mobile device marketplace, and nobody is going to buy Microsoft devices or software unless it offers a serious advantage. Which it doesn't. So now you have price... and fortunately Microsoft has over $40 billion in the bank, which it could use to lower the hardware price to make it irresistible. An iPad competitor at the same price? Meh. An iPad competitor at $199? Then you've got a chance at some serious market share.

Apparently, though, Microsoft has decided it doesn't need that. Maybe they think, like Nintendo, that they can always lower the price later if they need to. By the time they figure that out, though, the world will have judged their platform, found it wanting, and moved on. As will the developers.

Meanwhile, Apple is about to announce the iPad Mini, and will probably sell as many as they can make for months. It'll be hundreds less than a Surface, and it will have a zillion apps for it right away. Oh, and by an amazing coincidence, Apple has scheduled their unveiling just 3 days before Microsoft launches the Surface.

Surface who?

Wii U's Problem

Nintendo finally announced the Wii U last week, and they came in at the high end of price expectations. Instead of one SKU, Nintendo announced two: A Basic set with 8 GB of storage and a GamePad controller for $299, and a Deluxe set with 32 GB of storage, and a copy of NintendoLand in addition to the GamePad controller, along with a charging cradle for the controller, for $349. I think Nintendo expects to sell mostly the Deluxe set, and the Basic set is there just so they can say "the Wii U starts at $299." Both versions will be available November 18th in the US, and preorders are already being taken. Shortages may well be the case initially; cynics might suspect Nintendo of manipulating the supply precisely to create shortages in order to generate a greater desire to possess the console.

Nintendo spent a big chunk of its presentation showing off Nintendo TVii, a unified interface on the GamePad controller for finding and playing video from various services (like Netflix and Hulu), and controlling your Tivo (assuming you have one). Pretty nifty, actually, though not sufficient to buy a Wii U all by itself. Still, it brings the Wii U into rough parity with the Xbox 360 and PS3 as far as entertainment options go, and even one-ups them (along with Apple TV and Google TV) in some respects.

They also announced more details about the software lineup, and said there will be more than 50 titles available by March, calling it the best software "launch" lineup in Nintendo's history (a rather loose definition of "launch," giving it a whole 5 months). The biggie was Activision announcing the latest Call of Duty title, Black Ops II, will be coming out for the Wii U along with all the other platforms.

My concern is basically with the longer term for the Wii U. I grant that hard-core fans will rush to get one, and Nintendo would have been leaving money on the table to price the console lower. Supplies may well be limited, as Nintendo is not know for being able to manage high-quantity manufacturing well. (Though that would seem to be so much easier these days; again, cynics might suspect Nintendo will keep quantities limited through the holidays to maintain an image of a "hot seller" and so propel some more third-party publisher support.) Still, $349 is a high price to pay for a console that has no apparent graphic advantage over the Xbox 360 and the PS3. None of the titles that have been shown so far that appear on other consoles looked different in any way on the Wii U. Not any worse, like they would on the Wii; but not any better. Nintendo would certainly have been touting a clear graphic advantage if one existed. So I think it's safe to say that the Wii U, graphically, is on par with the 360 and PS3.

So here's the problem I see: Is there any compelling reason for a 360 or PS3 owner to drop $350 on a Wii U? None that I see. If you're a Call of Duty fan, the Wii U version offers no compelling advantage, so you'll just buy CoD for your existing console. New console buyers will be looking at Xbox 360 and PS3 bundles that are cheaper than a Wii U, and a much better value; the game lineup will be much better on the older consoles, with lots of inexpensive options, too. The Wii U may have a game play advantage with the GamePad someday -- but right now that's largely theoretical. A few of the games shown use the GamePad, but it's not clear the concept will be hugely popular. It may end up like 3D on the 3DS; initially Nintendo marketed it as the key reason to buy the console, and now it's hardly even mentioned.

My guess is that Nintendo will do well over Christmas with "limited" supplies, but that sales will fall off a cliff sometime early next year, and then a price cut will be in order. Microsoft and Sony have plenty of ability to drop prices and pile on freebies, so they will keep the pressure up on Nintendo. The Wii U is not really a next-gen console; it's competitive with this generation, it's just that Nintendo is about 5 years behind. They will need to get the price down as much as they can, as quickly as they can, to keep momentum going.

Even then I'm not sure it will work. Tablets are gaining in performance and falling rapidly in price, and they will become a key game platform for the future. The general consumer audience (non-core gamers) will be weighing the value of tablets against the value of consoles when they think about purchases for the household, and I think consoles will increasingly come up short.

Microsoft and Sony have some tough decisions to make about their next console offerings. If they boost performance by 5x to 10x over the current consoles, the hardware will likely cost $500. How can they offer a good value at the price? Or will they have to eat losses of hundreds of dollars per unit to achieve any kind of market share? Will there even be a large enough hard-core audience to pay for ever-increasing development costs on big-budget titles?

Microsoft Surface: Killer Game Machine?

Before you laugh at the idea of Microsoft getting any traction in the marketplace with their Surface tablets, consider the following:

Halo 4 is headed to the Surface tablet. Microsoft Entertainment head Don Mattrick confirmed this at the GamesBeat conference in July: "Speaking during a panel at VentureBeat’s GamesBeat 2012 conference, Microsoft exec Don Mattrick mentioned that the upcoming first-person shooter Halo 4 will work with Surface. VentureBeat reporter John Koetsier confirmed this with Mattrick after the panel."

The Surface Tablet may retail for $199. Yes, the hot rumor making the rounds is that the base Windows RT Surface tablet, with 32 GB of RAM, a Tegra 3 chip, and a 1280 x 720 10.6 screen, and a keyboard, may retail for an astounding $199. How? Well, Microsoft could be prepared to take a loss on every one in order to gain market share and make it up later on software sales; they did this successfully with the Xbox, remember. Or Microsoft could make the price $199 with a contract for (say) Xbox Live or Microsoft Office or SkyDrive or some combination of services.

The Surface tablet will also come with a keyboard, which makes up to some degree for the lack of tactile controls (a joystick and buttons); after all, the FPS did arise on PCs with a keyboard and mouse as the controllers.

We could have a truly epic battle for the wallets of consumers this holiday, if Microsoft really takes aim at the $200 market with a 10.6" tablet. They could even cannibalize their own 360 sales. I'd have to think consoles, and especially the 3DS and the PS Vita, would be the big losers in this scenario. Even mighty Apple could feel the pinch both at the low end (the forthcoming iPad Mini would look a lot less alluring) and at the high end (if Microsoft pulled a similar trick with the Surface Pro and undercut the iPad).

The biggest losers would be Microsoft's erstwhile hardware partners, like HP, Dell, Asus and others, who would see any chance for them to sell Windows tablets vaporize. Microsoft would also lose revenue from that, but they may just figure that ultimately they'll make more from having a strong share of the tablet market as a hardware manufacturer.

Start getting the popcorn ready; this may be the best entertainment available until The Hobbit hits the screens in December.

Battle Royale For The Holiday

It's shaping up to be one of the most competitive holiday seasons ever for the game business. The aging Xbox 360 and PS3 have been seeing fading sales numbers for the past several years, and at this point only price cuts are likely to make a big difference in their sales picture. Complicating this is the new Wii U, which will be coming this fall (though the date and price are still unknown as of this writing). Microsoft and Sony will probably try to undercut the Wii U pricing, and certainly bundle in extra value in software and other items.

Meanwhile, the flank assault of the mobile market is adding some serious firepower. Google's Nexus 7 tablet is a hit at $200, and Amazon will probably introduce a new, spiffier Kindle Fire next week at the same price point. Apple is rumored to be introducing an iPad Mini at around the same form factor in the $250 price range. So, powerful gaming tablets will be available for around $250 this holiday, with extensive marketing budgets to make sure everybody knows it. Those will be aiming squarely at the dollars parents might otherwise spend on consoles.

Don't forget there's a new iPhone coming out next month, which will likely suck a lot of money out of market for gadgets. Plus some dedicated gaming tablets (Android based) that may have wide distribution. Oh, and Nintendo is still selling the 3DS and Sony is still trying to move the PS Vita. And all of these things are hovering in the same price range.

They're not all going to succeed in having a terrific sales season. I think Sony and Microsoft could take a real beating if they don't lower their prices substantially. Nintendo could be in for a rough time if the price the Wii U at $299 or even $279. I'm sure Apple and Google and Amazon will do fine, though.

Just to make matters worse, many high-profile software titles will be competing for consumer dollars, too. And like last year, they will be competing against each other for ever-scarcer consumer dollars. Nobody is going to buy all of the hot games all at once, even if they want them; they can only really play one game thoroughly at a time. Somebody's gonna be disappointed in their sales picture.

Overall I expect the year will finish down over last year's sales, once again in the double digits despite the Wii U and PS Vita.

Nintendo vs. Apple PR Battle

You can find the original image here.

File this under Marketing Mistakes: Nintendo has scheduled a big press event in New York City for September 13, where they will (apparently) reveal the Wii U's pricing and availability date for the US. They'll also be showing off software and allowing hands-on time, and Reggie Fils-Aime will be headlining the event. Sounds great, right? Build some excitement for the Wii U launch, get the attention of the mass media, get big coverage of Nintendo's exciting new technology coming out later this year (probably November). What could possibly go wrong?

Try this: Apple is going to have a big announcement on September 12, according to rumors leaked to all the major publications. They will be announcing the new iPhone, and quite probably the brand-new iPad Mini (or whatever they call it), a smaller iPad with a price point rumored to be as low as $249 for starters. And maybe even an Apple TV (or iTV).

Yes, the day before Nintendo's big press whoop-te-do, Apple is holding their major press event for the next iPhone and the new iPad Mini. So who do you think will get all the media attention, especially the mass media outlets on TV, print, and online? Yeah, that's right. The company with the products that sell in the hundreds of millions. Which is not Nintendo. Epic Fail.

Just to really rub it in, the rumored price point of the iPad Mini is $249 for the low end model, and the Wii U may be priced at $299, or perhaps $249 if they are being aggressive. So Apple's device may be the same price point as the Wii U, and look like the Wii U gamepad controller... only Apple's device can go anywhere and still function. I could not have created a better scenario to stomp Nintendo's press announcement flat. There will probably be head-to-head comparisons between the devices, and Nintendo won't exactly win those. If Nintendo even gets mentioned in the PR flurry, the pictures of people standing in line at stores to get the hardware. Does anyone expect people to be standing in line, or camping overnight, for Wii U? Yeah, I didn't think so. Oh, and the Wii U won't be arriving for (probably) a month or two after Apple's devices... which will make the Wii U rollout old news by the time anyone can actually buy one.

Certainly Nintendo is not going to have the most-talked about new tech product this Christmas... not even close. The Wii U is going to have to succeed based on its pricing and software lineup, and Nintendo's marketing spend. I'm expecting not a terrific launch for them; I expect a fairly mediocre rollout, especially if Sony and Microsoft have some strong moves (price cuts? bundles?) for the holiday. The Wii U may look better next year sometime if they can get to a reasonable price point (like $199) and have some gotta-have-it software like a new HD Zelda, or a Mario title that actually does something interesting with the gamepad controller (unlike the Mario title they showed, which looks exactly like the original Mario gameplay).

My long-term guess is that the Wii U will never find the audience that the Wii did, not on that scale. I think Bing Gordon is right; Nintendo is headed towards being a software publisher, it will just take them a long time to figure that out. They'll have to have their noses rubbed in bad financials for years first.

Once Again, Sales Are Down

It's only an approximation, but you get the idea.

The latest NPD figures show that sales in retail stores were down 20% over the same month last year; that's the combined figure for accessories, hardware and software. Software alone was down 23%. What's the outlook for the rest of the year? I think it would be an achievement if sales were only down 20% over last year... which, as you may recall, was the third straight year of declines from the high point of 2008. 2012 looks to break new ground with a solid double-digit decline.

Sure, overall the industry is doing well, thanks to digital distribution, mobile, social, virtual items, and all the rest. That doesn't help the companies struggling to transition to the new reality, though. It also bodes poorly for consoles, and new consoles in particular. Part of the decline in sales is due to the fact that publishers aren't putting out as many titles, and until (and unless) new consoles can demonstrate a renewed buying fervor for $60 games, I wouldn't expect to see the number rise. It will continue to shrink.

Some wholesale rethinking of game designs needs to take place. The industry has chased the rabbit called Better Graphics down the rabbit hole for three decades now, and it's still the guiding force for big publishers. Unfortunately it continues to get more expensive to deliver better graphics, and that usually comes at the expense of innovative game mechanics and good, balanced game play. Maybe we should rethink the idea that all customers want is better graphics.

I submit Minecraft as evidence that killer graphics are not a requirement to become a hit. Minecraft's graphics would be considered crude for the late 1980's, and yet the game has made tens of millions. Gee, maybe there's some players out there who care more about game play than graphics. Good luck trying to sell that at a big publisher.

At least with mobile games and downloadable games there are more ways than ever to get a game to market at a low cost, so we're seeing a lot of creativity. I think game players are going to have plenty of good choices ahead of them; game companies (especially big ones dependent on old business models) are going to have a tough time in the next few years.

As for me, I've got a design I've been working on that the world may be ready for...

Microsoft Surface: New Gaming Platform?

Microsoft announced their new line of Surface tablets yesterday, and they look pretty sweet. The tablets come in either an ARM chip version for Windows RT (Windows 8 for ARM), or the Surface for Windows 8 Pro (which uses an Intel Ivy Bridge Core i5 chip, running Windows 8). Lots of unanswered questions still, but there are still at least several months before we see the ARM version (and 90 days after that before the Intel version ships).

Of course, a lot depends on details that Microsoft didn't reveal, like the exact specs or, you know, the price. And since they didn't let journalists actually use the devices, it's not clear how smoothly they operate (a big problem with many Android tablets). Assuming Microsoft can get all these details sorted out, though, I think these tablets have some serious potential. They shouldn't have a problem grabbing the #2 slot in the tablet market away from Android, anyway. For Windows users the idea of running all your Windows software on a tablet, and doing it well, sounds pretty good. (Assuming it's not too damn expensive, that is.)

For gaming, these bad boys could bring keyboard-and-mouse games on the road in a big way. OK, it's a trackpad instead of a mouse, which is less-than-optimal for some games. But for a lot of games it could be just fine.

What's not to like? A few things... the nomenclature is clunky. Surface for Windows RT? Surface for Windows 8 Pro? Inelegant and confusing. How about just Surface RT and Surface Pro? Or something equally simple. Apple's had some naming clunkers, too -- MacBook Pro with Retina Display is far less nifty than the actual device. Still, they have time to fix this.

More problematic is announcing so far ahead of shipment. Maybe they felt rushed by the impending announcement of Google's tablet (rumored to occur next week). Maybe the wanted to slow the headlong rush into iPads, and perhaps make it so Apple won't sell 20 million more by the time they get this to market. In any case, they've given every competitor some time to think up responses.

How will this dovetail with their smartphones, and with Xbox 360, and the Xbox 720? You can bet Microsoft will try to make these things fit together somehow. This may be the right product to knit together their various divisions, and get the success of Xbox and Windows working together to make a new category successful.

Or it could just be another Zune, and end up as a trivia question someday. Maybe. I think this has some good potential, but Microsoft still has many, many things to get right before it launches. I'm rooting for them; successful competition will drive everyone to make better devices at better prices, and consumers all win in that case.

Apocalypse Nowish

I just got the latest NPD numbers for May, and they seem to explain why so many games feature post-apocalyptic settings. It's just looking ahead to where the traditional retail channel is heading. Sales overall are down 28% over last May, with hardware dropping an astounding 39%, and software 32%. Accessories were up 7%, but that's a case of the tail lifting up the whole dog.

So far since December, sales have been consistently down 20% or more over last year for both hardware and software. Call me Cassandra, but I think we're looking at 2012 being yet another year of declining video game sales. Sure, there will be bright spots for some companies, but those that aren't looking in other places for substantial growth are delusional. Companies have to find ways to generate revenue other than putting a disc in a box and sending it to retail stores. Fortunately, most seem to have gotten the memo. The question is, can companies make the shifts necessary to thrive as fast as the marketplace is changing?

It's an exciting time, to be sure. Doubtless many executives wish it would be a little less exciting, and more resistant to rapid change.

Here's what NPD said: “YTD 2012, there have been 27% fewer new software title introductions into retail which we believe is a big part of the softness we’re seeing in May sales. A title obviously continues to see sales beyond its launch month, so there is a longer term impact from a narrower array of available new content. That said, we saw some exciting content at E3 that will come to market in the latter part of the year, and when great content comes to market, gamers are still showing up at the stores to buy it.”

Hah. "Softness" is a rather delicate term for a drop that's around a third of your total sales. Try "devastating" or "horrifying" to get closer to the sensations that causes when execs look at the numbers and try to think about meeting payroll.

Time to pull some rabbits out of the hat for the holidays, or else the Grinch will be putting Christmas on eBay for pennies on the dollar.

Warren Spector and I Talk Game Violence

I posted an interview with Warren Spector on GamesIndustry International, which among other things talked about his opinion that the violence in games has just gotten completely out of hand. (I recommend you check it out; there's also some interesting stuff about Epic Mickey 2 in there.) Having seen a wide selection of the newest games at E3, I can't really argue with that. There's some really graphic violence out there, and in many cases it seems to be used for shock value and as a way to get attention.

I see this as a classic example of the tragedy of the commons (I actually took a population ecology class from Garrett Hardin a few years after he wrote this paper). Essentially, doing an ultraviolent game has some incremental benefit to the company that does it (or at least, they think so); it gets them expanded attention and hopefully greater sales. At the same time, it damages the entire game industry, by creating a worse impression of games overall. Which leads to more attempts to regulate games and keep them away from kids. That damage is diffuse and hard to quantify, and occurs over a period of years, so it has minimal meaning to a company that's purely focused on numbers day-to-day. Thus individual companies can conclude that increasing ultraviolence in games is in their best interest.

Hopefully companies will exercise some judgment, but that's more likely if people take a stand and say No, I won't buy this. Look, there should be plenty of shooters out there to choose from; you should still be able to shoot things and have fun while still avoided games that go too far over the top.

Sadly, designing a game where you kill things is easier than designing a game where you have more nuanced considerations. Weapons use is pretty mechanical and easy to figure out; emotions and human conflict are much, much trickier. Still, there are plenty of interesting games being created out there with unusual and interesting mechanics. At E3 I saw Pikmin 3 on the Wii U, and it looked like a lot of fun. Even without spurting blood.

Wii U: WiiK

Some people seemed to think this is a Wii peripheral.

Nintendo's press conference here at E3 2012 underwhelmed me. I was really hoping they'd show a strong lineup of games and some compelling reasons why people would buy a Wii U. Nope. Not even close.

Really, one of the best ways to tell how they did is the audience response, from an audience predisposed to like them (the audience that cheered when Shigeru Miyamoto took the stage at the beginning of the conference): At the end, Nintendo got a polite 'golf clap." And not much of one at that.

Look, I think Pikmin 3 looked really nice, but that was clearly the best thing they had. And it's not even necessarily a launch title, they only said that about NintendoLand. Is Pikmin 3 going to make anybody other than the most passionate fanboy run out and drop $300 (probably) on a Wii U? No way.

Third party support was weak. EA who? Activision what? No Grand Theft Auto? Really, if the best you can show is Batman (which is what they lead with), it's a weak lineup. Ubisoft is nice, but they don't pull in the hardcore.

Half of Nintendo's presentation was about sports, fitness, dancing and singing. For the hardcore gamer, you got a zombie's head exploding... a few minutes of hardcore action in all.

Nintendo spent a lot of time on NintendoLand, and their whole E3 booth is built around it. It's basically a set of minigames that use iconic Nintendo characters. See, we have Zelda on Wii U! Well, a little archery range in NintendoLand with a Zelda theme, that's pretty much the same as a Zelda game, right?

They did show Super Mario for the Wii U... it's basically an HD Super Mario. No differences in game play were highlighted, nothing that showed a reason for the gamepad. They didn't even spend much time on it.

Look, it's pretty clear Nintendo had a very weak lineup because they spent so much time on pointless things, like introducing execs from other companies. If you have a ton of games to show, you spend time doing that, not having execs smile and wave and crack dumb jokes.

Once again Nintendo has gotten hardware to market well in advance of software. This looks like the weakest starting software lineup of any Nintendo launch I can remember, and I remember all of them back to NES.

Nintendo still has time to make some corrections to their launch plans. They haven't announced a price yet. They haven't announced a ship date. They could still pack NintendoLand in with the hardware rather than trying to get you to spend $50 or $60 on a collection of minigames.

I think the reaction of investors is pretty telling, though. Nintendo stock dropped 3% after the press conference. Not exactly a ringing endorsement of their announcements. I think Nintendo's headed for another bad year, perhaps exceeding the scale of last year's debacle.

Microsoft and Sony must be pretty happy. They don't have any new hardware this fall, and they won't need it. Perhaps a bit of a price drop here and there (PS Vita, I'm looking at you) and they should do just fine. Nintendo is going to need to pull some large rabbits out of somewhere to have a happy Christmas.

Games Sales For March 2012: Down 25%

Once again the NPD numbers look pretty grim. Total game industry sales dropped 25 percent to $1.1 billion, as total software across consoles, portable and PC fell 26 percent to $585.1 million, while hardware sales plunged 35 percent to $323.5 million. This makes the 4th month in a row where sales have dropped more than 20% over the previous year... which, overall was down 8%. And that was the third year in a row of declining sales for video games... that is, for console games, primarily.

Nobody I talk to, and I've been talking to a lot of CEOs lately across the gaming industry, seems to be all that thrilled with the advent of a new console generation. Oh sure, they are all hoping for it to be a great success and arrive soon, but I don't think anybody believes that this console generation is going to beat the last one in sales.

Which has long-term implications for where big publishers should be investing...

China Attempts to Ban Internet Rumors

Yep, the Chinese government has really got fed up with all those rumors on the Internet, and has decided to ban them. Well, they have released a paper on how to fight rumors, and this comes about a week after they punished China's two largest Twitter-clone sites, Sina and Tencent for spreading rumors. It's not clear what the punishment was, but all comments have been banned for now. I guess those rumors about a coup d'etat in Beijing hit a little close to home. Nervous much?

I'm sure that attempting to ban rumors on the Internet is gonna work great. Right after they succeed at that maybe they can get rid of spam, too. I don't think I'll be holding my breath waiting for their success.

I'm not sure what connection this has to games, except to note that Tencent, one of the punished companies, is also a major game company (remember, they bought Riot Games last year). No word on whether this may affect their game operations.

It does make you wonder, though, about in-game chatting in the hugely popular Chinese MMO's... since any of these attempts to ban rumors wouldn't affect in-game chatting. So gamers may be the first to know things, unless the Chinese government wants to contemplate shutting down the Chinese game industry. Now, that might really spark a coup d'etat...

Video Game Sales Expected Down Again

Michael Pachter at Wedbush Securities sent out a note this morning, saying they expect NPD figures for March to be nasty once again. They expect software sales to be down 23% over last year, following similar declines in December, January, and February. Hardware sales were down, too, but only by 8%.

Grim numbers for traditional videogames sold in traditional retail channels. Yes, DLC helps, but not enough. Gamers are getting more careful about what they buy on disc, at least new games on disc. There's so many other options these days. Numbers for May, when Diablo II comes out, will doubtless look pretty good, but the overall trend is pretty scary. Declines of a few percent here or there can be handwaved away; declines in the 20% range month after month cannot be dismissed so easily.

Durango vs. Orbis vs. Wii U

These concept pics are inevitably way cooler than the actual hardware; too bad.

The ramp up to E3 is starting, because rumors about consoles are getting more common. Now I see stirrings about Microsoft's Durango (the current codename) having a 16-core processor (compared to 3 cores in the 360), though 4 of those cores will be needed to handle the built-in Kinect 2.0 voice and movement recognition (higher resolution than the current one). It'll have AMD Radeon HD7000 series graphics. Oh, and it will have a Blu-Ray drive. Sounds expensive... 

Meanwhile Sony is working on the PS4 Orbis, which may have an AMD 64 bit CPU and a GPU that can output 4096 x 2160 images. Why is that important, when you can't find a TV in that resolution? Well, it means you can have 60 fps 3D images. And higher-res TVs are in the planning stages. This unit also sounds expensive.

Meanwhile, we get word that Nintendo's looking at a Wii U hardware cost of $180, nout counting packaging and software and any other incidentals (like paying for marketing, R&D, and the like). So the Big N is planning to retail the Wii U for at least $300, maybe more. Ouch.

I'm guessing that the Durango and the Orbis will be more in the range of $400 to $500. Double ouch.

Good luck to all of them; I think selling devices seen primarily as game consoles will be very difficult at those price points. Especially if, as I expect, there will be Apple and Android options for far less. Of course, consoles are increasingly being seen as multimedia devices; Microsoft admitted recently that more hours are spent streaming music and video on the Xbox than are spent playing games. Will Sony and Microsoft be pushing their new consoles more as media centers than as gaming devices? That may be one way to justify a high price.

The marketing battles will be interesting this Christmas, as Nintendo tries to establish its new hardware and Sony and Microsoft try to keep selling old hardware as the world becomes increasingly aware of new consoles headed for Christmas 2013. Grab a comfy chair and some popcorn, the show will be fascinating.

Wii U vs. Xbox 360 vs. PS3: Not as Powerful?

The tablet controller feels pretty good, in my experience.

I've been talking to some developers working with the Wii U, and they've told me that in their opinion it's just not as powerful as the current generation of consoles. (I go into that in depth in this article on GamesIndustry International.) Do I believe them? I believe that's their opinion, and they have experience in many different consoles. Determining "power" isn't all that easy, though. You can't run the same benchmarks on different consoles. Raw spec comparisons won't help too much, as the processors and GPUs are different. Then you get into polygon count, textures, fill rates, bandwidth of the graphics bus... until you can compare the same game running on each console you can't really be too accurate. Even then, it will depend on the tools the developers used, and how familiar they are with the hardware, and what design decisions were made in creating the game (for instance, how the texture maps are created).

All you can really do is have a fairly general comparison. It's readily acknowledged that the PS3 and the Xbox 360 are roughly comparable, though you will find people who will argue particular points that mean one platform is "better" than the other. Almost everyone will agree that the Wii is significantly less powerful, not even putting out HD graphics. The Wii version of a game doesn't look as good as the same game on PS3 or Xbox 360.

I expect that the Wii U will fall somewhere in the range of "a little less powerful" to "a little more powerful" than the Xbox 360 or the PS3. We won't know for sure until the hardware is out and has been dissected by the hardware geeks. (Right now, any pre-release hardware can still change some things, like clock speeds or RAM, that could significantly affect performance.) And I expect there to be plenty of arguments.

I still think the clearest indicator of the Wii U's power level is not what developers say, it's what Nintendo says. Nintendo's statements have very specifically stayed away from talking about power, and have focused on game play, innovative mechanics, and just being fun. That's a good position to take, I think; the most important thing is how much players enjoy playing games on your console, not the number of polygons per second. It does imply to me that Nintendo knows the Wii U is not significantly more powerful than a 360 or a PS3. Why? Well, if it was, they'd be saying that over and over again. Raw power is an easy thing to market; "You get twice as much (whatever) for the same price" is a strong selling point. Nintendo's not using it, which means to me it isn't the case.

Some rumors have been floated before about the Wii U being 2x more powerful, or 4x, or even 8x. I don't believe those, because I see no reason why Nintendo would not have been saying or implying that for months if it were true.

The odd thing to me is how so many people get, well, religious about their devotion to a console or a manufacturer. Personally, I wish them all well. I have friends at many companies, and I hope they all succeed. I enjoy playing games on the Xbox, PS3, and Wii; they all have their good points and bad points. I do feel it's my job to point out problem areas ahead, and when I think somebody's making a mistake. In that light, I don't think Nintendo is making a mistake so far with the Wii U; OK, maybe with the name, which I think is weak for a number of reasons. But in general I think Nintendo's new console should not compete on power, and should offer one or more innovative features that drive adoption and make for compelling games. Which they seem to be doing, though until we see actual games it's hard to say if the tablet controller will be as successful an innovation as the Wiimote and motion control have been. (My guess at this point is no, because the tablet's not as simple and approachable as the Wiimote, but I could certainly be wrong.) I think pricing is going to be critical to the success of the Wii U, along with the games. A Wii U at $399 is going to flop, I think. A Wii U at $299 will have some convincing to do. A Wii U at $199 would be a big hit if there's some good games (a hi-def Zelda title would sell systems).

I suspect the Wii U will debut at somewhere between $249 and $299, and that Microsoft and Sony will probably drop their prices to give the Xbox 360 and the PS3 a stronger competitive position against the new kid on the block. Nintendo's going to have to market hard because Microsoft and Sony will be, too. If Nintendo doesn't have a more compelling software lineup than they did for the 3DS, they're going to have a very crappy Christmas. Hopefully they've learned that lesson, but you never know. It would take a lot of guts to delay the launch of the Wii U several months if the hardware was ready but that Zelda game just wasn't finished. Nintendo might well say, heck, we'll sell some units to the fanboys regardless of the software, and after the good titles come out sales will turn up and everyone will forget about how bad the launch was. It worked for the 3DS, didn't it?

Maybe. But the market keeps changing, and the competition isn't snoozing. Nintendo's going to have to be innovative in their business models eventually, and that's where they have really fallen behind. Announcing the Nintendo Network is a good step, but the real trick is making it work well. Nintendo's going to have to work hard to get back on top of the console business.

Because like the Stark family says in Game of Thrones, "Winter is coming." Microsoft and Sony will probably ship new consoles next year, and then the Wii U will be clearly behind once again in terms of power. (Which is yet another reason not to base your marketing on raw power right now, because in 18 months you'd lose that argument anyway.)

Ebooks Have A Magic Moment

Other authors may do this, too.

The traditional publishers are facing some scary magical power, wielded by none other than J.K. Rowling. Her Pottermore.com web site has begun selling Harry Potter ebooks, as the exclusive place to buy them. Rowling's clout is such that she even got Amazon and barnes & Noble to point to her site in affiliate marketing arrangements. Rowling gets to keep roughly 70% to 90% of the revenue from the Potter ebooks, which are selling for $7.99 for the first 3,  $9.99 for the last 4... or $57.54 for the set. Sure beats the heck out of the usual 17.5% cut that traditional publishers give to authors for ebook editions.

Granted, Rowling is not the typical author; far from it. Yet other big names (paging Stephen King) are probably looking at similar arrangements, or at least better terms. The big authors are what generate the most profits for traditional publishers, so this should be a wake-up call. Of course, you'd have thought the events of the last few years would have been a wake-up call, too, but you would have been wrong. Legacy publishers seem to be pulling the sheets over their heads and hoping the scary ebook monster goes away.

This is not to say that publishing your own ebook is necessarily the way to go. But every author now has a lot more options to consider, and some thought as to which path to take. There are many more options for getting your book to market, and that's a good thing. It's more complicated, though, and not necessarily easier. Heck, signing a deal with a publisher and then sending in your manuscript and waiting for checks is about as easy as it gets. Publishing it yourself is much more work... but you may make a lot more money, too, if you are successful at it. I advise all authors to study the market carefully; read Joe Konrath's blog, Mike Stackpole's website, and others.

Be prepared to do a lot of homework. Magic spells optional.

Kickstarter: New Publishing Model?

Nice try.

There's been a rash of Kickstarters lately connected to people and publishers I know, and I think it's worthy of comment. Double Fine's Kickstarter brought in a record of over $3.5 million to do an adventure game. Yes, an old-school, point-and-click adventure game, to be created by Tim Schafer and Ron Gilbert, who did games for Lucasfilm like Monkey Island and Grim Fandango. It's interesting to note that their proposal doesn't even describe what the game will be about. The fan base is so devoted to all of their old games they don't really care what a new game would be about, they just want to see one.

Similarly, Brian Fargo put Wasteland 2 up as a Kickstarter, and it's already broken through $1.5 million. People remember the original RPG, and want to see a sequel. Other Kickstarters are proposed for novels, tabletop RPG projects, and mobile games. More people on jumping on, looking for funding. I think there's some things to be aware of in order to have a successful Kickstarter campaign.

First off, Kickstarter has lots of advice, which you should take to heart. They have to approve your project, too, so that's a hurdle you have to pass. Make sure you do an excellent video; that's a key element in most successful proposals. It's your chance to make the pitch in the most compelling way possible. Use it well.

Now, some other considerations:

Have an audience. If you've got a big fan base, that's going to be a key element in success. If you know the size of your fan base, and can run some numbers ahead of time, you'll get an idea of how likely your Kickstarter is to succeed. If your lowest support level is (say) $10, and you have a fan base of 1,000 (based on previous sales, or members in your forums, or Twitter followers, or some such data), and you're asking for $5,000, you're likely to be disappointed. Why? Because you're expecting 50% of your followers to cough up money; that's a very high percentage. Something in the single digits would be more believable. Try to set yourself up to be pleasantly surprised on the up side; if you can make a go of it by getting 1% of your users to support at the lowest level, you're in good shape. But what if you don't have an audience? Then...

Be totally cool. Whatever your doing just has to be a cool concept. Maybe it's a gadget, or an RPG setting, or a movie, but when you explain it there's a lot of people who will go, "Ooh, me want." Don't expect a huge response if you're doing something obscure. If it takes you a long time to explain what it is and why it's cool, it's not compelling enough. If you can boil it down to a simple phrase, and everyone you tell that phrase to says "Wow," then you've got something.

Offer good value. Don't expect people to throw money at your project, even if it's totally cool and you have a big audience, if you're not offering a reasonable value. A paperback book for $50? Not a good value. A hardcover coffee-table book with gorgeous photographs or art for $50, signed by the author and photographer, in a numbered limited edition? A great value. It's all relative, so look at similar things on the market or available in stores to get an idea of reasonable pricing.

Be believable. If the audience doesn't believe you can deliver, they won't support it. Hopefully you have experience that will lead them to believe in your project, but make it explicit as to why you can deliver what you're promising. Also, can you do it in the time frame described, with anything or everything else you may have going on? Convince the audience of this.

Offer a wide range of benefits. More is better, I think. Check out a bunch of Kickstarters to see what kinds of things they are offering. Don't neglect the high end! You'd be surprised how much money some dedicated fans will come up with (some free-to-play games have sold in-game items for $10,000 or more!). Make sure you are ready and able to deliver on everything; don't offer dinner with yourself if you really don't want to have dinner with some random people, even if they are your fans.

I don't think this financing model will take over game publishing of any kind, but it certainly has a place. It's also good marketing for you and your company, if it's successful. So make sure it's a success!

GDC 2012: Uncertainty

The dust is starting to settle down from the show, though I still have a stack of interviews to process; breaking news keeps getting in the way. It was an intense show, with each day booked more or less solid with interviews. I did have enough time, barely, to walk through the Expo and the Career center, but hardly any session time. Heck, I didn't even run into Eric Goldberg this time, and that always happens!

One question that I was asked repeatedly: What's hot at GDC? In other words, what's the most interesting thing I saw? I saw and heard a lot, but my overwhelming impression was this: Uncertainty.

There's a great deal of uncertainty floating around the industry, and that's highly unusual. For decades, since the late 1980's, the business model was pretty stable: You took a pile of money, paid a bunch of developers to make a game, and then a year or two later it would be done. You'd take another pile of money and build a bunch of inventory, your sales force would get it out into retail stores, and the marketing would hit a bit before release. You'd sell about 80% of what you were ever going to sell in the first month. Once you shipped, you were pretty much done, and everybody involved would have moved on to the next project.

Oh, there were variations on this. Over time the piles of money required got bigger, and the time required got longer. Technologies changed every 5 years, so that would always make things more difficult (read: expensive) for a while. But basically the business model stayed the same. If you wanted to bring out a game, you had to do all of those things. Sometimes that meant partnering with one or more companies in order to get something (like distribution) done, or you had to raise money in a variety of ways to pay for one step or the other. You may have been uncertain about how to accomplish a given step in the process, but you weren't uncertain about the steps you had to take.

Now that's all changed. Digital distribution, free-to-play, ad-supported, mobile, social, subscriptions... all of these innovations have irrevocably shaken up the business. It doesn't mean the old business model has stopped working, though it has gotten more difficult (retail sales down 4 years running, and dropped over 20% last month and the month before over the previous year). It's just that there are so many more places to sell games, so many new platforms, new business models, new regions of the world (China is now a huge game market), and, oh yeah, every possible demographic is now a gaming demographic, not just teenage boys of all ages.

So nobody is really sure that they're doing the right thing, or all of the right things. I talked to one developer who is getting a tablet game ready for shipment in a couple of months. I asked them whether it would be free-to-play, or whether they would charge for it. "We still haven't decide that yet," was the answer. Wow. YOu never would have hear that even a few years ago.

I guess the best advice at this point is that you should be re-examining all your assumptions about the business. And then do that again in a few months, and regularly after that. It's gotten very unpredictable in this business, so stay agile.

Will the next console generation sell better than the last? I don't think so, unless the console makers pull some very large and clever rabbits out of their hats. If it's just "same as the last console, only 5x better graphics capability and it's $499," then no, the next console won't sell better than the last one. Good luck with that, console makers. It's going to be far more difficult this time to launch new harder and have it sell well over time.

GamesIndustry International Live

The new GamesIndustry International site, which combines IndustryGamers.com and GamesIndustry.biz in a whole new layout, has gone live. Check it out. One cool feature I like is how if you click on my name, you not only get a bio, but it also shows all of the pieces I've written (not all the old ones from IndustryGamers yet, but at least some from this week as we switched over). Another nice feature is that it automatically formats for a mobile browser, so the site is easily read from a cell phone.

I'm sure there will be issues and glitches as we work things out; certainly it will get a stress test this week with all of the news stories we'll be posting from GDC. Not that I know how I'll find time to write everything... no in-depth analysis this week, just trying to re-direct the massive data stream.

I hope to see some of you during the show as I race from interview to interview...

GDC: Rumors Ahoy!

It's almost here.

The Game Developer's Conference starts on Monday, but I'll be up there tomorrow. Already the rumors are starting to swirl. David Cage of Quantic is supposedly going to show some of their new work that may represent a new stage in the evolution of story in gaming, beyond Heavy Rain. Valve is supposedly working on their own console design, a "Steam Box" that's like a custom PC built around Steam but priced like a console; the big difference, really, would be that such a device would be built around digital distribution at its core. Yeah, you could go to a store and buy PC games for it, but why bother with the drive?
Then, of course, Apple's got a little announcement to make on Wednesday morning, just a co-inky-dink that this takes place during GDC at a venue literally on top of the Game Developers Conference. It'll be their new iPad, of course, sporting a screen with 4x the resolution of the current one, no doubt with a faster processor and other bells and whistles. Also rumored is a new version of Apple TV that can handle full 1080p video... and maybe apps? Is it time for Apple to begin the apocalyptic battle for control of the family room? Maybe, but  probably it'll be later in the year when they actually have some content deals on board.
More rumors? Sure, there will be whispering about Microsoft's successor to the 360, and maybe what Sony plans to do with the PS4, and even the unthinkable might happen and Nintendo lets slip with a nugget of more info about the Wii U. I not sure I believe any of this, but I welcome anyone who wants to whisper rumors of half-glimpsed developer version of new hardware into my eager ears.
Oh, and the IndustryGamers site will be merging with GamesIndustry.biz to create GamesIndustry International, the world's largest game industry news and analysis site. That should go live on Monday... check it out, especially on your mobile phone (where it will automatically format into a nice friendly mobile version).
Me, I'll be busy during GDC conducting interviews, chasing down rumors, listening to talks, and hopefully seeing a lot of friends. I'll try to post some news and tidbits every day if I can... there will be plenty of posting heading to the new GamesIndustry International site, so keep an eye there (it'll be at the gamesindustry.biz URL with a whole new look). See you in the halls!

Collectible Card Apps?

Sure, there's been CCGs as software; you can play Magic: The Gathering online, after all. And virtual card games are all over the place, it seems, on a variety of platforms. Toy Fair is seeing a new take on the idea, though, from Nukotoys, with their Monsterology game pictured above. Apparently you flick one of their cards against your iPad or iPhone screen and it will appear inside... check out the video here.
This may or may not fly, of course. It's far too early to tell, and besides you have to see what sort of marketing they have lined up. And if the game is any good; its not easy to design a good card games. It's also not clear how much collectibility they are planning for, either.
Still, it's another interesting trend to keep an eye on for traditional gaming companies.

Boardgames, Meet Apps

When Life hands you iPads, make apps.

The convergence of boardgames and tablets is happening fast. Check out what Hasbro is showing at Toy Fair: Monopoly, Battleship and The Game of Life in special appified versions. The iPad sits in the middle of the board, and the spinner is on the iPad. As are funny videos that play as you move through the board, from Americ'as Funniest Home Videos. Will they fly? They may not right away, but at the rate tablets are being adopted it shouldn't be long before this becomes popular. (Estimates are that Apple alone may sell more than 45 million tablets this year, and that may be conservative once the iPad 3 hits and they (maybe) reduce the price of the iPad 2.)
Then there's this app, which is shown here:

You have pieces you move around the outside, which integrates with the software (the board knows where your pieces are). I talked to these guys at CES, and tried to convince them to go to the GAMA Trade Show and sign up some adventure game companies.

Really, the adventure game industry (RPGs, boradgames, and miniatures alike) needs to get over to smartphones and tablets ASAP, preferably last year. The ability to completely distribute digitally is an amazing transformation of the business. Not to mention cost savings, and the fact that the core adventure game demographic overwhelmingly has a smartphone, and tablets are growing even faster than smartphones now.

The future is arriving at a rapid pace; get with it or you're history.

Game Industry Sales Down 34% in Jamuary

Yeah, it's pretty much like that.

Remember how NPD was saying for months last year that sales declines were just a blip, that things would look better in the 4th quarter with all sorts of strong titles being released, and that sales for 2011 would be flat from 2010, maybe down just a smidge? And then the numbers for December hit: down 21% from December 2010, and overall sales for 2011 were down 8%. Time to panic? No, no, everything will be fine in January; this was just lots of sales getting pulled into November, January will be back up.

January sales dropped 34% from January 2011.

OK, time to panic.

That is, if your sales are still all based on shipping boxes to retail stores, you should be wondering how long that will last. Sure, EA and Activision seem to be doing pretty good, selling more boxes than ever... but only of the biggest titles. The midlist is quickly going away, and companies based primarily on less than AAA titles (hello, THQ) are having a very rough time.

Unless they've transitioned to digital distribution, social and especially mobile games. Free-to-play is whacking the business of $60 retail boxes pretty hard, too.

That transition to digital distribution that was going to take many years suddenly doesn't seem so distant. A few more months like January and things will change very fast indeed. I predict that 2012 will see another year of dropping physical retail sales, possibly into the double digits unless the Wii U does amazing business (but it's likely to only have a couple of months of sales in this year).

GameStop better hurry up with those new initiatives into digital.

How Not To Market Gaming Accessories

Actual poster at a CES Booth

Sometimes you just have to wonder why nobody stood up at the marketing meeting and said "No." Or maybe "Have you lost your wits?" Apparently no one did for this company that makes gaming mice and gaming keyboards. Somehow they though that this slogan would appeal to those crazy Americans.

Really, guys (I presume guys; women usually don't seem to stoop to this marketing level of juvenilia), what the hell were you thinking? Looking at this (which is also the backdrop image for the booth, by the way) I have no idea what they're marketing or why I should care. Features? Benefits? Nope, not there. Odd image of a cat outline with an American flag design over it? Sure, that's there. Whatever that means. And did I miss something or did the Germans actually invade America in World War II? I thought they never got here... I must not know as much history as I thought. Of course, countries that did have legions of German "tourists" during World War II don't exactly have fond memories of the time period.

Save the lame jokes for when you're at the hofbrau knocking back some lager. When you're marketing, try to at least point to the product or service, and maybe even hint at a benefit or two.