How to survive the mobile gaming apocalypse

I was listening to the latest Walled Garden podcast and towards the end they stopped just short of stating what many developers I talk to have been saying–mobile gaming is dead.

Ok, not actually dead. After all, mobile gaming revenue is higher than it’s ever been, and mobile consumption of everything is eating the planet. However, mobile gaming is completely dead as a business model for independent developers and undercapitalized startups.

IAP has become so dominant that there’s really only one somewhat reproducible way to make money in the AppStore: make a hamster wheel f2p game in a handful of established genres and spend tens of thousands of dollars a day on user acquisition to drive traffic to it. Despite many bold experiments, the charts increasingly bear this out.

Republique

This means that some companies with top charting mobile games aren’t actually making a profit as UA costs can eat up most of the revenue. Surely this will produce a shakeout and consolidation in 2014. This is similar to what happened to Facebook games circa 2010 causing a mass exodus to mobile.

Now that mobile is dead, where should you escape to? There are several options.

PC

The PC, and more specifically Steam, remains the platform of choice for those who actually want to charge money for content. There’s a large market for premium games and Steam has loosened their gate with the advent of Greenlight. Some prominent developers have been abandoning mobile for PC with their new projects. Despite PC sales declining in the face of tablets, it makes sense. This is where the paying customers are.

Consoles

A lot has been written here about the impending demise of consoles, but Sony and Microsoft managed to change up their business model and product strategy enough to have early success with both the PS4 and XBOX One. One of the big changes has been the thawing of the gated ecosystem and allowing independent developers to self-publish. Oh yeah, and on the Wii U also.

Next generation console owners are starved for content. There will be many independent successes over the next few years before the channel becomes completely saturated.

VR

On one hand VR is merely a peripheral for existing games, on the other it’s part of an entirely new category of wearable computing and an emerging platform. Oculus Rift is the clear leader with a huge round of investment and development kits widespread. However a glut of VR headsets is on the horizon.

Oculus is building an ecosystem out of their device, but VR content can be distributed through any PC gaming channel. Although, supporting every single headset may be a nightmare for developers–isn’t it time for some kind of standard VR API?

Board games

Board games are a cottage industry yet a hot category on Kickstarter. As an example, Sandy Peteresen’s Cuthulu World Combat iOS game Kickstarter failed miserably, but when re-pitched as a board game, it blew past its funding goal. Going from digital to physical presents a lot of new challenges for developers, but does have a dedicated fan base of paying customers. Plus, you can’t pirate a board game!

Facebook / Web

Facebook games ‘died’ in 2010, but are ironically becoming an increasingly common alternative platform for mobile developers. Especially if you have a working web client already, why not put it on Facebook? The problem is the audience is decidedly non-hardcore. Facebook games can still make some money, but for a very specific audience. However, for hardcore games, the open web still remains a viable place to find an audience of paying gamers. Kongregate proves this.

What needs to change in mobile?

The supremacy of f2p and the very few options for user acquisition make the momentum towards free and the companies with enough money to compete in the mobile UA wars insurmountable. Apple could make some changes to the App Store to help support premium games and other alternative business models, however there really isn’t any incentive to do so–Either way, Apple sells phones. It’s difficult to foresee anything but the continuing dominance of f2p and mega-publishers on mobile in 2014. If you have a ton of cash and resources, solving this problem is hard, and thus very lucrative. For the rest of us, plan your strategy accordingly.

Add Asynchronous Gameplay To Console Games

Animal Crossing New Leaf is HERE!

The new Animal Crossing is out on 3DS and the Twitterverse is alive with 140 character quips of Tom Nook. Animal Crossing is significant because it’s among the first console games that had game events occur in real-time. I remember having to wake up at the crack of dawn to harvest rare mushrooms in the original Game Cube version–Or having to frequently return to my town in order to clear weeds that grew in real-time while away.

Real-time game events have since made their way into other games, such as how storefronts in Fable 2 earned money even while your console was off. Perhaps the most recent example is Undead Labs’ brilliant State of Decay. You can queue up construction tasks much like a Facebook game. If it takes 30 minutes to build a new structure, you can turn off the game and play in a half hour when construction is complete. This definitely shows social gaming’s influence on console games.

One game that sorely needs this is Capcom’s Monster Hunter. In the latest edition you have a farm and fishery as well as the ability to send players you’ve met via StreetPass or on-line on asynchronous quests. These are all great features, but the problem is that they run in game-time.

For instance, it may take until the completion of 3 quests before your batch of blue mushrooms is ready to be harvested from the farm. It would be far better if it actually took 10 minutes in real-time to complete. Then, much like Animal Crossing, you’d remember to fire the game back up later to reap the rewards.

These are the type of features that should be handled by companion apps. I eventually grew tired of Monster Hunter 3 Ultimate after incessantly playing it for a few weeks. If my phone bugged me that my crops were ready, I’d re-engage with the game. Instead, my Wii U is turned off and the game world is frozen in time. At this rate, my honey crop will never grow. The combination of companion apps and asynchronous gameplay can be used as a retention mechanic to gently remind players there’s still more to be played.

Quick Notes: E3 2013 Edition

WAR!

E3 2013 is over! This was the most exciting E3 in years. GAMES ARE BACK! Sony and Microsoft are putting up a vigorous defense against the cow clickers and hamster wheels that have taken over gaming in the mobile and social era. It was so refreshing to see such a variety of new IPs that are actual games–games based on fun, mechanics, and experience instead of pure compulsion. I’m psyched for the PlayStation 4 and XBOX One. I pre-ordered both during their respective press conferences. A few notes:

Microsoft needs to fire their entire marketing department. Everyone was talking about Microsoft’s DRM strategy and not the games. Microsoft has completely lost control of the narrative and it’s hurting their ability to promote the XBOX One as an actual games platform.

Microsoft’s strategy of promoting the XBOX One as some kind of media center hub is the wrong one this early in the cycle. They need to engage early adopters for a console launch–people such as myself. All we want to hear about are games. Sony smartly focused on games–even if most of them were multi-platform.

The new Sony is poised for victory. Roles seem to have switched this generation, with Microsoft’s XBOX 360 success creating an attitude of arrogance that has led them to a tone-deaf press conference and hostility to so-called “indie” developers. This is the same attitude Sony had when the PS3 launched that caused a huge decline in market share.

Sony has learned from their mistakes and have radically changed their publishing model. They have embraced indie developers and flexible business models as evidenced by two prominent f2p PS4 titles on the show floor. I talked to many talented developers who had PS4 kits but were refused by Microsoft for XBOX One developer access.

Where was mobile? Compared to last year, mobile had a much reduced presence. Many publishers showed mobile titles along with their console slate, but gone were huge booths from GREE and other Asian mobile powerhouses. It was interesting to see tablet and mobile elements blended in to console games, such as in Ubisoft’s awesome demo for The Division. As discussed here before, companion apps have a long way to go–but this was probably the best example to date.

Hardware on the fringe. Lots of niche hardware made noise at E3. Not the least of which was Oculus Rift. With the show floor abuzz with news of the HD version, it seems at least Sony may be investigating supporting it. Microconsoles such as NVidia’s Project Shield (not so micro at $349) and the Oyua made big splashes too. I’m skeptical of the long-term viability of these platforms–although TowerFall convinced me to pre-order my Ouya.

Nintendo? Where was Nintendo? Their decision to broadcast their press conference on Nintendo Direct may have been an error–but perhaps a good strategy since they really had nothing to show that could counteract the massive PS4 and XBOX One announcements. Their booth was heavily attended, but Nintendo was seemingly out of the running. Luckily, they have enough cash to hunker down and weather the storm this generation.

Favorite games at the show. I never really spend much time waiting in line to watch demos or play games at E3, but I did have a few favorites upon cursory examination. Killer is Dead is a spiritual successor to Killer 7 from Grasshopper Manufacture, and looks fantastic. Dragon’s Crown is a gorgeous 2D side scrolling RPG by Vanillaware in the same vein as Capcom’s old D&D coin-ops. Keep your eye on The Order: 1886 for the PlayStation 4. This will be one of THE exclusive PS4 titles to watch.

Anyway, this was a GREAT show. I’m really excited for the next generation consoles. GAMEPLAY IS BACK.

A Few Quick Notes: GDC2013 Edition

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GDC 2013 Rundown

GDC has become increasingly irrelevant over the past 5 years or so as influence has moved away from the realm of cloistered AAA console game teams and to so-called “indie” developers and the disruptive platforms of mobile and social. Because of this, you can get much better information having conversations with other developers. I spent most of GDC talking to people–you can always watch the good presentations on the GDC Vault.

The trend for 2013 is an industry wide panic over free2play. Presentations and panels worried over whether f2p games are ethical and how the game industry is supposed to survive through this disruption. Considering this is a conversation game developers have been having since 2009, it just goes to show how long it takes for GDC to catch on to major trends.

“Indie” developers were the big celebrities this year. So much so that formerly closed platforms from Nintendo and Sony bent over backwards to encourage garage developers to create content. Nintendo greatly loosened requirements for their development program and even revealed HTML5 support for the Wii U. Sony eliminated concept approval. This shows there are some radical changes ahead for the next generation–Changes I suggested years ago on this blog.

The biggest star of the show was Oculus VR. The wait time to try the Oculus Rift headset grew to over 2 and a half hours by the final day of GDC. I got in to see it and came away hopeful, but unimpressed. The current prototype headset is uncomfortable, but I didn’t spent much time adjusting it. The display resolution is low, causing a screen door effect. When I turned my head, the screen smeared to the point where I couldn’t see anything.

These problems are being addressed. They showed me the physical part for the new screen–the retail version of Oculus will fix the resolution and latency issues. The current kit is strictly for developers and mega-nerdy early adopters. It’s pretty neat for a $300 prototype, but far from a finished product.

I was more impressed with Infinite Z’s zSpace virtual holography system that was on display at Unity3D’s booth. It costs over 10X what Oculus does for no apparent reason. Still, being able to draw 3D splines in thin air and look around them was really cool.

Overall, GDC had a lot of opportunity on display as far as new devices, markets, and tools–but a lot of uncertainty on how to actually make money producing games.

Favorite Quotes of GDC

  • “Cokeheads are better than publishers.”

  • “They said they’d publish my game if I turn it into a Skinner-box.”

  • “The reason why you won’t close the deal is because you’re too competent.”

A Week with the Wii U

I got a Wii U Deluxe on launch day. Sales have been mixed, and so has the reception. I figure jotting down a few notes about Nintendo’s latest console is a cheap way to get a quick blog post done. As opposed to some of the more scholarly articles about this controversial console, let’s just do some bullet points.

  • The Wii U as a concept is ridiculous. It’s a tablet, but the guts of it sit under your TV. The console transmits video to the dumb-terminal GamePad, thus you can only use it within 30 feet or so of your console. This is despite one of the big features being the ability to play games on the tablet instead of using the TV. If you taped the Wii U console to the back of the GamePad and got a really long extension cord, it would be kind of like a tablet, I guess. Or…you could just get an iPad.

  • Dual Screen is distracting. In many cases a dual screen interface is more annoying than innovative. Many Wii U games don’t seem to have thought it through. Having to constantly look up, then down, then up, then down during the course of a game is irritating. Perhaps later games will find a more natural way to use this interface.

  • The load times are ABSURD. Nearly every single system menu you cycle through on the Wii U takes 15-30 seconds to load. This makes the Wii U interface almost entirely unusable. I can tell Nintendo is keenly aware of this problem, because instead of fixing it they play theme music while the loading wheel spins and spins. I’d invest in some better engineers instead of composers.

  • Wii support is sub standard. First, you have to boot the Wii U. Then you have to select Wii mode and watch it boot again. The Wii U makes a sound like a little elf in the box pushes the Wii U chipset out of the way and attaches a dusty old Wii motherboard to the video-out. Which probably isn’t too much of an exaggeration. At the very least, make it boot automatically in Wii mode if you power the console on from a Wiimote.

  • The Miiverse is brilliant. When playing games I usually have my iPad open to a Wiki or GameFAQs looking for clues and solutions. Nintendo captures all of this traffic in their own ecosystem with Miiverse–a Twitter-like message board featuring micro posts in both text and sketch form. If you’re stuck in a game, just hit the home button and browse the Miiverse to see if anyone has figured it out. Miiverse needs to be a bit more organized, but it’s a great start.

  • ZombiU is a close contender for game of the year. Seriously. With Resident Evil 6 face-planting, there’s a new king of survival horror. I truly don’t get the negative reviews. Perhaps the writers were expecting a different kind of game. ZombiU is, as others have said, is a blend of classic Resident Evil and Dark Souls. At first I found the dual screen interface annoying. Later I realized having to look down at your inventory while zombies lurk in the shadows adds a sense of panic. The game is dark, tense, and beautiful. ZombiU is one of the most interesting designs of the year and a game of astounding quality, especially considering it’s a launch title.

Overall the Wii U is an unimpressive package. It’s nice to finally get a Wii that supports HDMI–and ZombiU is a triumph. However, the 2013 slate doesn’t look like many Wii U games of that quality are on the horizon.