Ask Electronic Arts (EA) head John Riccitiello what he thinks about the game software development industry and you might be surprised by the answer. In an interview with the Wall Street Journal, EA’s chief executive said games coming out from top game makers lack innovation and that the industry needs to aggressively expand their audience beyond traditional gamers and pursue so-called casual gamers.
“We’re boring people to death and making games that are harder and harder to play,” Riccitiello told the Journal.
Riccitiello’s remarks echo criticism that has been levied at game makers for some time now by industry watchers.
“I totally agree with John,” Michael Cai, a Parks Associates analyst, told TechNewsWorld. “I’m one of the analysts that has repeatedly said that the industry cannot rely on chasing [intellectual properties] and producing sequels. We are at a turning point right now and only true innovation can further strengthen the industry.
“It takes some courage for EA’s chief to make such statements,” Cai continued, “since industry heavyweights are more likely to suffer from ‘active inertia’ — relying on past success. Let’s see whether EA can execute its vision and lead industry changes or whether smaller companies will steal market share away.”
Industry Change
The industry does have some shining moments, according to Riccitiello, as with Activision’s “Guitar Hero” series; the massively multiplayer online role-playing game (MMORPG) “World of Warcraft” from Vivendi and MTV’s “Rock Band.” However, he noted in the interview, the industry needs to try out new sales methods that extend beyond the tried-and-true format of producing US$50 to $60 games with 40 hours of gameplay that only the truly dedicated gamers are able to complete.
Serialized games are a sound strategy, Riccitiello told the Journal. Game makers just need to ensure that the later editions are more innovative.
Failure to maintain the gaming industry’s high level of innovation puts the business at risk of being less interesting than new cell phones, Facebook and iPods, Riccitiello fretted.
At the helm of the world’s largest video game publisher since April, Riccitiello has already begun to put his theories into practice. In June, the company announced a reorganization that included the formation of a new gaming group devoted to casual gamers, EA Casual Entertainment, with Kathy Vrabeck, onetime president of Activision Publishing, holding the reins.
“EA is aligning talent and resources to focus on the growing market for highly accessible games,” Riccitiello said at the time. “We’re fortunate to have recruited a dynamic executive like Kathy Vrabeck to lead this team. She’s got a proven success record in our industry and the ability to help EA leas this fast-growing genre of entertainment.”
Van Baker, a Gartner research vice president, agrees with Riccitiello in terms of the need to produce more innovative titles and reduce the complexity of the games if they want to broaden the base. However, attracting casual gamers may not be the answer, he said.
“The only thing I have some reservation on is the need to attract casual gamers,” Baker told TechNewsWorld. “While this is an admirable goal, the casual gamer is not going to pay $400 to $600 for a game console, so the hardware is out of sync with his vision.”
Playing It Too Safe
Looking at sales statistics, it would be difficult to conclude that the gaming industry is hurting. For the month of May, U.S. video games sales were up 31 percent to $274 million, according to the sales tracking firm NPD Group. Overall, the industry saw a 49 percent increase in sales to $815 million for the month. However, that can largely be attributed to the cyclical nature of the gaming industry following the release of a new hardware including the Wii, PlayStation 3 and Xbox 360, according to Joe Laszlo, an analyst at JupiterResearch.
“The reason the games industry has done really well is the launch of the new console generation,” he explained. “Game developers are realizing that, [the] game industry being very cyclical, next year is likely to be the plateauing year and after that we’ll start to see revenues decline again.”
Riccitiello’s statement was bold, but not far off the mark, Mike Goodman, an analyst at Yankee Group, told TechNewsWorld. The gaming industry has become to some extent risk adverse — instead of investing in new intellectual property, which has a high risk associated with it, the game developers are releasing a lot more games based on movies in addition to a bunch of sequels.
“There is still a market there that will buy games no matter what, but certainly there is less risk taking,” he explained.
Games such as “Gears of War,” “Army of Two Men” and “Spore” — the as of yet unreleased new game from Will Wright — were risks, Goodman pointed out. However, looking at the bulk of games coming out, a large percentage of it is based off of existing intellectual property.
Even Nintendo Lacks Originality
Another example of innovation coming out of the industy is the Wii, according to Parks Associates’ Cai. The gaming console resulted from Nintendo’s realization that relying on the same gamer pool will not take the industry much farther.
“Japan has had stagnant growth for several years until the Wii and DS came along,” he pointed out.
However, even with the Wii and its newfangled controller, Nintendo has relied on the same old games for the most part including the “Mario Bros.” franchise and “Pokemon,” noted Goodman.
“The only thing the Wii has that is different from everyone else is its input system,” he stated. “It’s still the same games. It’s still the same franchises.”
Where Nintendo has taken a risk is with its “Brain” games. Even here, though, the risk for the game maker was relatively low, Goodman said. “These games are nowhere near as expensive to produce as games for the Xbox 360 or the PS3,” he noted. “But they’ve created a new genre of games and as such they found a way to grow the marketplace.”
The Wii may not be breaking ground in terms of its games, but it certainly is having an impact, if only because “the games industry is waking up to the fact that there are other people who would play games, just not the games that they are designing,” Laszlo said.
“Where the Wii has also definitely opened some eyes is the idea that playing video games is not necessarily a solitary thing or something that you play with people online who you’ve never met in the real world. Video games can actually be something that people do with friends in the room,” he added.
EA’s announcement of the addition of a “Family Play” game style in its line of EA Sports games, is a good example of developers building games that appeal to a broader audience, Laszlo added.
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