The Price of Braid

To follow up on Geoff’s Braid post, according to Braid’s developer Jonathan Blow, the reason why Braid is $15 instead of say, $10, is because he was worried that it would turn into another “Space Giraffe”.  That is, a game that only sold a limited number of copies at too low of a price to be profitable (which he’s especially worried about since he says he went broke to develop the game).

This seems to be a direct reference to this Gamasutra article, which claims that because of Space Giraffe’s dedicated fanbase, Minter probably could’ve charged even $20 (instead of $5) and come out way ahead.

Read the rest of this entry »

Revenue Recognition at EA

N’Gai Croal asks Michael Pachter why EA’s revenues are primarily PS3-focused at this time, even though the PS3 is not the majority of its sales.  Pachter answers, somewhat cryptically:

“Two things are at work. First, the way deferred revenue works: EA recognizes revenue on Xbox 360 over six months following the sale, but does NOT do so for PS3. So sales of Xbox 360 games during the last two quarters (Battlefield: Bad Company and Army of Two) are rolling through till December, while sales of PS3 games are booked when sold. Second, some of EA’s sales are skewed in Europe, where UEFA Euro 2008 and Battlefield probably sold a little better on PS3, and with Rock Band launching in Europe this year (also skewed PS3). Ubisoft was because of Haze, which was a PS3 exclusive.”

Commenters ask the obvious follow-up, “Why would EA recognize revenue differently for the PS3 than it does for the Xbox 360?

Since there is no response, I’ll hazard a guess: my suspicion is that the answer is in this note from EA’s 10K:

Seasonality

Our business is highly seasonal. We have historically experienced our highest sales volume in the holiday season quarter ending in December and a seasonal low in sales volume in the quarter ending in June. Starting in fiscal 2008, we began to defer the recognition of a significant amount of net revenue related to our online-enabled packaged goods over an extended period of time (i.e., typically six months). As a result, the quarter in which we generate the highest sales volume may be different than the quarter in which we recognize the highest amount of net revenue. Our results can also vary based on a number of factors, including title release dates, consumer demand for our products, shipment schedules and our revenue recognition policies.

In other words, many of the 360 titles are online-enabled, and since they probably make more money from them relative to the PS3, they decided to defer their revenue.  Why?  I’m not entirely sure, but they may need to increase the accuracy of their earnings estimates since more money will be coming from revenue not related to the sticker price of the game… which may be an unknown quantity.  According to FASB pronouncements, they need to recognize when the amount is “determinable.”  As the 10-K states: 

“Prior to fiscal 2008, we were able to determine VSOE [Vendor-Specific Objective Evidence; vendor-specific money, for the layman - ed] for the online service to be delivered; therefore, we were able to allocate the total price received from the combined product and online service sale between these two elements and recognize the related revenue separately. However, starting in fiscal 2008, VSOE does not exist for the online service to be delivered for certain platforms and all revenue from these transactions are recognized over the estimated online service period.”

In any case, that’s my best bet… although it assumes they’re getting substantially more online revenue from the 360 than from the PS3.  Mr. Pachter, feel free to weigh in.

Re-Branding Sierra

Over at Edge, Kris Graft has an opinion piece up arguing that Activision should kill off the Sierra brand.  I’m not sure what percentage of the readership still recalls Sierra, but most remember them for a string of highly successful adventure series (King’s Quest, Leisure Suit Larry, Space Quest, Gabriel Knight, and Quest for Glory, among others) which more or less rivaled LucasArts during that era.  Unfortunately, since their highs in the 90’s the company has been plagued by mismanagement, poor strategic direction, and a general inability to adapt to changing industry dynamics.

Graft’s main argument is that since the Sierra name has essentially been slapped onto “whatever Vivendi wants to publish,” it no longer serves any useful function and should be eliminated.  While I agree with the former sentiment, I’m not sure the latter necessarily follows per se.

Read the rest of this entry »

Stop Reflexively Bashing EA

EA takes a lot of flak from gamers and the gaming press, and some of it is undeserved.  For example, the idea that EA publishes nothing but me-too sequels: see Penny Arcade’s amazement that the company is publishing Mirror’s Edge and Dead Space, two of the more anticipated games coming out of E3 this year.

But EA is also the company publishing Spore.  And Rock Band.  And Crysis, and the Sims, and a ton of other intriguing games that are or were - if not fully ahead of their time - at least doing their part to move the industry forward a little bit at a time.  Sure, they put out a ton of crap as well, and they, like any other large company, milk franchises long after they stop becoming interesting.  But the firm’s doing a decent job attempting to decentralize its management of the group’s developers, and it seems like it’s starting to pay off. 

There’s a tendency for gamers to put on blinders once they’ve categorized a company, and EA is no exception.  Viewing them as the Evil Empire is far too simplistic for what’s really going on there.  And it’s silly to be so shocked by outcomes like Dead Space, because anyone paying tatention to the industry can see that complexity.

Worst. Excuse. Ever.

So, Bungie’s new project was supposedly going to be unveiled this week and was called off at the last minute.  Why?

Bungie wasn’t really saying except that their “publisher” was responsible for it.  Said publisher turned out to be, unsurprisingly, Microsoft, as the LA Times discovered.  What was their excuse?

Don Mattrick, senior vice president of Microsoft’s Xbox games business, said the company decided to pull Halo …

… to help trim its E3 presentation to under 90 minutes, from 2 1/2 hours, to accommodate attention-challenged reporters. “We had an embarrassment of riches,” Mattrick said. “We felt we could do this game more justice with a more dedicated event.”

This has to be one of the lamest excuses I’ve ever heard, and is not believable at all.  If this is true, then Microsoft is being ridiculously stupid here.  Bungie had been hyping a big reveal for weeks on their website, so the stage was already set for them to make a big splash.  And when you have an “embarrassment” of riches to show, you don’t hold back on your biggest franchise from your most successful developer at the biggest (or one of the biggest now) industry-specific events just because you think you already have so much great stuff to show (which something like “You’re in the Movies” would seem to disprove).

Some have theorized that they didn’t want to take away from their Final Fantasy XIII announcement, but that honestly doesn’t make much sense to me.  Do they really believe that people couldn’t get excited for more than one thing at a time? Instead of just “Wow, FFXIII coming out to the 360!” it’d be “Wow, FFXIII coming to the 360 AND this awesome new Halo game!  I’m sure happy to be a 360 gamer now!”  No, I’m sorry… if you have something good to show, you show it at what is arguably the most important trade show in the industry (or at least, it used to be).

Which brings up what may be the more likely reason it wasn’t shown yet: it wasn’t good, or, at least, it wasn’t ready.  Based on how one bad E3 experience can potentially (unfairly) shape the future of your game (ahem), maybe Microsoft just didn’t think the game was in a good enough state to show yet.  I don’t really have a problem with this, but it’s strange that they would give such a weird excuse rather than just tell the truth.  If Bungie ends up revealing their game in just a week or so and it looks amazing, I’ll admit I was wrong, but right now I don’t believe their excuse for a second.

Microsoft Gains First Strike and Scores a Critical Hit!

You’ve probably heard by now that one of Sony’s biggest theoretical exclusives, Final Fantasy XIII, is coming to the 360.  To be honest, even before I owned a PS3, this was never a huge concern of mine.  To begin with, I knew the game was basically never coming out.  And as much as I liked Final Fantasy IV, VI and VII, I never really got too into any of the other ones (got close to the end in VIII, barely started IX, played a little bit of X… X-2 and XII are on my shelf unplayed).

But, yeah… I know there are a lot of Final Fantasy fans out there and this will make probably half of them ecstatic, a quarter furious, and a quarter who don’t care.  Either way, this is, at the very least, a major psychological blow to Sony and a big coup for Microsoft.  A friend of mine was literally trying to sell his 360 to pick up a PS3 MGS4 package because he figured he could play MGS4 and (what he most wanted) Final Fantasy XIII whenever it finally came out.  Based on this news, that is no longer going to happen and he is keeping his 360.

Read the rest of this entry »

An Lament To Paul W.S. Anderson

Look, I know that Anderson’s movies are almost uniformly terrible.  And I know that they’ve been almost uniformly treated as such, since he hasn’t had a commercial success since Mortal Kombat (and perhaps Resident Evil, which wasn’t a very big-budget film).  In fact, the only reason I assume studios let him direct is because they think gamers are idiots who will buy anything with a brand name on it.  So maybe this complaint is unhelpful.  But here goes nothing.  By what logic does it make sense to license a video game franchise, and then write a script for it that eliminates nearly every distinctive connection to that franchise?  This is not a rhetorical question. 

This isn’t good for gamers.  We don’t get the movie translation of the game we wanted, and so we’re less likely to be excited about the movie, less likely to see the movie, and less likely to talk it up to friends.

This isn’t good for studios.  A generic movie that’s unconnected to the franchise means that studios have shelled out a substantial licensing fee for no reason except to put the word Castlevania on it.  Since gamers who like the franchise are the only ones who care about that name, and you’re dragging it through the mud, the value of that word is nearly non-existent (or at worst negative if they take to the internet to complain). 

This isn’t good for theaters.  People who are at best indifferent to your movie, and at worst, openly antagonistic, aren’t paying $10.50 a pop to sit in an uncomfortable theater with loud children and overpriced food to see it.

This isn’t good for directors.  You’ve already stacked the deck against your future success.  Anderson may have more directorial lives than a Hindu cat, but his luck has to run out eventually.  No one’s going to pay for a director to make films that lose money.

This isn’t good for general audiences.  Another generic, vaguely vampire-themed movie with no discernable differences from any other?  Yawn.  That’ll stand out in a crowded market.

So who does this help?

Smoke In The Crystal Ball

Hal Halpin of the ECA takes a close look at some popular gaming predictions over at The Escapist.  Unsurprisingly, he views many of the futurist predictions as unlikely; when you consider that previous predictions in all sorts of industries have generally been wildly off-base, his skepticism isn’t really all that surprising.  People just aren’t very good at extrapolating across huge swaths of time - in part because technological change happens so quickly and unpredictably.

Read the rest of this entry »

How much is too much?

With Guitar Hero: Aerosmith coming out in just a few weeks and Guitar Hero IV/World Tour expected later this year, you’d think Activision would be happy with their current Guitar Hero slate for the year.  Apparently not, as Kotaku points out that Guitar Hero: Metallica is slated to hit before the end of Activision’s fiscal year, (by March 31, 2009).

Let’s leave aside, for a moment, whether Guitar Hero: Metallica is a good idea or not.  Does this seem like a bit much to anyone else?  Not only is that going to be 3 Guitar Hero games within a year (4 in roughly 1.5 years), but with Rock Band continuing to offer weekly content, a likely full-fledged Rock Band sequel almost definitely going to be announced sometime soon (no inside info, just a hunch), and even a THIRD Guitar/Band franchise coming from Konami, is anyone worried about over-saturating this market?

Read the rest of this entry »

A Plague Of Locusts O’er The Land

Tadgh Kelly has a post up at GSW arguing that the delisting approach that Microsoft will be taking with XBLA marks the end of the platform as we know it.  Unfortunately, he makes his argument so hyperbolically that it obscures some of the good points that underlie his point.  Although I agree with his basic premise entirely, his conclusions start to run off the rails.

Kelly and I are in agreement that searching for games in XBL is currently unworkable.  Unless you know what you’re searching for, it’s nearly impossible to search for games with some reference to quality, popularity, or gameplay type.  We’re also in agreement that the proposed solution isn’t necessarily the ideal way to handle this concern.  But that’s where our opinions largely begin to diverge.

Read the rest of this entry »