2012, the video game industry

So here we are, in march of 2012. Some of the recent news has been that of rumors of the next generation of consoles the new xbox, and the new playstation.

This just brings me back to another point I made before in a forum post:

I just don't understand this. Think about it, everything bad about this generation will be worse next generation.

The cost of making games has already skyrocketed from previous generations, if you've noticed the middle tier of games has all but vanished since the last generation. Now we have the Big blockbusters, and indie games, and then some shovelware.

Having a new generation of consoles would just make the price /higher/. Before you say anything, I know there cuts that have to be made for this generation of consoles, and that it would give the developer more freedom. Though, think about it, the same was said for this generation of consoles, and look how many genres have just vanished, and how you can't even make a lower budget game that isn't a downloadable retro game, or few hour indie game.

Sure, you could say that you don't have to use that power, and you could make the games not pushing the system, but in that case, again games would be relegated to crappy, pretty much how things are now if it doesn't toe it with the best of them. Also, in such a case, why not just make a 'this-generation' game?

Then there's the price of games themselves, which will probably make the jump to $70, but I am willing to bet that things like Online passes will start shipping in every game, and games will start to get more and more chopped up to work with a DLC model to support the increased budget of games.

Also, with the huge push against used games, who says we will even be able to trade in or sell games, at and have them keep their worth. Rumors have it being that the next xbox will use chips instead of disks, which means, they could lock games to your console, or make it so future purchasers would be locked out of features, achievements, content, etc.

And you know what? Sure the used game market hurts developers who need to make money to survive, but it's also the combat to keeping game prices high. Look at the Wii's Virtual Console for a good example, since it it sells only old games, which cannot be bought in any other way for the Wii, they can sell them, and never lower the price or have sales. Without a used game market to push publishers to keep their pricing competitive, who's to keep them from making things /more/ expensive? It's not like there would be an alternative.

And what about what we have now? Look at the original Xbox, and hope you have all the DLC and updates you wanted, because they are now gone forever. This would probably happen a little slower with a new generation, but it would happen in the long run. For any game that did not ship with a game of the year, or complete edition, updates and DLC are just gone forever.

And what about backwards compatibility and the online servers for most of these games? Like the Vita, 360 and PS3, my guess is that it will have /some/ backwards compatibility, but probably far from 100%, even to the previous generation. As for older generations, probably no chance. The online servers for most of the old games will probably go the way of the dodo, and if they lack split screen or LAN, like most of them do, that will just be it. No more MP, endofstory.

Also, what about all your downloadable games? Will the new systems support them? Depending on the amount of Backwards Compatibility, it might not be as likely as one might think having all the games you bought still be able to be run. Meaning either you will be out of luck, or you will have to rebuy the games to make them work, in likelihood.

So, here we stand, with the rumors being that new consoles will not play used games.

What does this mean for us, for the video game industry, and for gaming in general... Well. Here's a good example: Joe buys a game for his new console, the Xbox 720/Durango, and purchases many games for it. Joe loves the games he purchased, and plans to replay them, both split screen, online, and single player for years to come.

The first thing that will be taken down, is the online servers. Due to the closed nature of the consoles, and the pretty much killed off tunneling services (XBC/Xlink), the online portions of the games are now completely dead. This is to be expected, a company cannot be expected to keep the servers running forever, it costs money.

Now, what happens when the following generation of consoles come out? Suddenly the always online nature of the consoles, and the locked 'no-used-games' policies will make all these games just unplayable.

"But they are just games, play them kill time, and get over yourself."

For some people maybe, but look at this versus the book or movie industry, or even the music industry. Just because it's been a few years, it shouldn't mean we can't listen to the Beatles anymore, right?

Some people like video games more than as just a pastime. I am one of those people. I would like to be able to play Uncharted, Valkryia Chronicles, Killzone, inFAMOUS, LittleBigPlanet, Rock Band and more down the line. That is the reason I bought the disks, so that in case of server pull, I can still play all the games I've bought.

"This will help the video game industry! No money lost on used sales, more money for development time, and more money for creative games! Who knows cheaper to buy games maybe?"

Well, for a second, let's believe that this is a large sum of money, let's say, for the sake of a thought experiment that it is 20% of the sales the game normally gets. That's a load of money for a game that does well.

Now the argument assumes that the extra money will go into making more creative, or better made games. Now, let's look at the the industry, and see what we can learn.

The generation transition from PS2 era->this era has killed off a lot of genres. Where are the high budget JRPGs? Where are the non rpg adventure games? Where are the high budget arcade racers? Where are the platformers? Where are the middle class games (Games like Katamari, which the first of was not expected to do well, but was was still brought over to america)?

This shift happened due to an effect I like to call 'the hollywood games effect' which is as such: Before it only took a handful of people to make a game, and with those people it could only take a year or two to make a really nice and polished game.

This generation however, pushed up the ceiling of what you can do, and that's fine. Better graphics, physics, AI, etc. But this comes with a price. These things don't do themselves, the higher res textures, more detailed models and other improvements all need people working on them. Something as simple as 1 character model could be made in perhaps a day or less last generation. Now-a-days, things have a higher bar, so games that cannot cut the quality just don't do well.

"That's a good thing, right?"

No, it's not. Sure there are a lot of bad games then and now, but the quality I am talking about is the graphical quality. This problem is the main reason for the gaming industry being where it is now. Because of the graphical expectancy of games these days, anything that does look to par, gets ignored for the most part. If a game gets ignored, then that style of game will be less likely to be published.

This is what happened, the development costs went way up, and when the costs are so high, all it takes is one failure to lose all the money that went along with the development costs, and put your company on death row.

So, this generation has been the birthing ground of 'safe' games. Games that are nor very different from whatever else is out there, since the unknown is less likely to sell.

How does this related to my point? Well, a new console generation means yet again raising the bar, and raising the development costs. This would cut into that extra 20%, a good amount too.

Let's say to be conservative, that it cuts only half of that out, so the extra amount gained from the lack of used sales becomes 10%.

Wow, Call of Duty MW3 sold enough to make 1 billion in 16 days. So, 10% of that is $100,000,000 which is huge!

So that could be case closed, but let's think about this for a second longer. Call of Duty, is one of the highest selling video game series ever. Now, the original argument stated that this would give that much more time to develop/innovate the game.

Now, let's say we take Valkria Chronicles, a game that was very highly rated game for PS3, which failed to capture a larger audience, had rumored overall sales of around 1 million copies, a lot of which were after a price drop. So, let's think about this. Let's make it 50/50 for before and after price drop, since we don't know when the sales were. This will assume the $60 and $30 price points were pure profit. We'd have 45,000,000 made from the $60 price, and 15,000,000 for the $30 price point. Now, taking 10% of that would be $4,500,000.

That still sounds like a fair amount. But you split that up, and compare all of the money made vs the cost of the overall development, and you get a much smaller figure, one that would probably have very little effect on the creativity of the industry. In fact, this would simply push the industry farther towards only the games that sell loads of copies.

As for more polishing time? Maybe, but nothing that would drastically change the quality of the games. Once again, more complex games = more things can go wrong.

Now, this is also all using the figures that the development increase in games would only be 10% of the current price. One that seems shooting low to me.

Here's another thing that will probably happen to gouge some more money from people:

Notice how the online prices for downloaded games versus the used prices. There are PSP games that sell for $8 on disk, or $40 for a download.

Now, giving publishers the power to never lower their prices... Will probably mean.... They wont. In fact, I'd think games on the whole would be more expensive. No competition with used sales to be more affordable.

So, in closing, we have potentially these things to look forward to:

• Higher costing games, and/or games never going very far down in price.

• No longevity, (The following generation will kill the ability to play the coming generation)

• Creation will fall even farther (More FPS, less zany original games)

• Always online connection needed (Internet down? No gaming for you)

Fun. I might just sit back and play through my backlog.. :(

The video game industry is making me very sad these days.