1 / 35

Overview of the Interactive Entertainment Industry

Overview of the Interactive Entertainment Industry. Ernest W. Adams ewadams@designersnotebook.com http://www.designersnotebook.com +44-1483-237599. First, A Little History. The game industry grew out of two branches Personal computer games Arcade games Other branches arrived later

eugene
Download Presentation

Overview of the Interactive Entertainment Industry

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Overview of the Interactive Entertainment Industry Ernest W. Adams ewadams@designersnotebook.com http://www.designersnotebook.com +44-1483-237599

  2. First, A Little History • The game industry grew out of two branches • Personal computer games • Arcade games • Other branches arrived later • Home consoles • Online games • Gambling machines • Location-based entertainment

  3. Segments of the Game Industry • Arcade (coin-operated) games • Home console video games (Nintendo, etc.) • Personal computer games • (And on-line games) • Smaller segments: • Gambling machines, handheld games, cell-phone games, ride simulators (LBE)

  4. Arcade (Coin-op) Machines • Entirely closed systems • Game designs limited by time • Possible to have specialized hardware • Expense of manufacture limits entry to market • Not exactly a retail product

  5. The Home Console System • Advantages • Enables hardware to be sold very cheaply • No matter who builds the software, the hardware manufacturer gets a royalty • Guarantees product quality • Disadvantages • Limits creativity • Limits entrepreneurship and competition • Potential conflict of interest when hardware manufacturer also sells software

  6. The Personal Computer • Powerful processors for better games • Excellent video resolution & color depth • Excellent sound reproduction • Keyboard permits complex games • Multipurpose device • Education; home office; reference; on-line • Still an open system! • (But also much more expensive)

  7. On-Line Games • Many early problems • Complexity of setting up a modem • Low transmission speeds • High hourly charges • Large growth potential • Most problems above addressed • Internet standardizes transmission protocols • Multi-player play offers a richer experience • Customer service is still a problem

  8. Interactive Television • Family-oriented • TV as output device • Education + entertainment • Unproven concept • TV a poor device for text • Is this an activity families want?

  9. Gambling Machines • Very different design issues • Not a retail industry • Heavily regulated • Adults only • Included because it IS interactive entertainment

  10. Culture - Video Game Development • Founded by business people • Expensive development systems • Expensive manufacturing: cartridges or special CDs • Risk-averse; little design experimentation • Difficult for newcomers to enter • Hard to learn the tools • Secretive • Much larger market

  11. Culture - Computer Game Development • Grew out of homebrew clubs and user groups • Anyone can do it without a license • Shareware! • No expensive development stations needed • More experimentation, unusual games • Friendly, open, many resources to help

  12. The Marketing IssuesWhat makes people want to buy interactive entertainment?What determines if they will or not? • Risk Analysis • Comparable Prices of Other Equipment • “Household Use” Theory

  13. Risk Analysis The purchase decision is based on the amount of money lost if the consumer does not like the product. This amount of money consists of: Initial (equipment) costs Price per hour of play

  14. Risk Analysis Cost to Buy/PlayUp-front costCost per UnitPlay LifeCost/Hour Playing cards$2 $0  $0 Board game$25 $0  $0 Broadcast TV$250 (TV) $0  $0 MMORPG$40 (install)$10/month 120/month $0.08 (assume PC) (4 hours a day) Cable TV$0 $40/month 120/month $0.33 (assume TV) (4 hours a day) Paperback book$5 $0 5 $1.00 Video game$250 (console)$40 40 $1.00 Computer game$700 (PC) $40 40 $1.00 Movie rental$250 (VCR) $2 2 $1.00 Movie at cinema$0 $8.50/ticket 2 $4.25 Baseball game$0 $20/ticket 3 $6.67 Arcade game$0$0.50/play 0.05/play $10.00 (3 minutes) Live theater$0 $20/ticket 2 $10.00 Slot machine$0 $0.01/play 0.0008 $12.50 (adjusted for winnings) (3 seconds) Pro football game$0 $50/ticket 3 $16.67 Opera$0 $100/ticket 3 $33.33

  15. “Comparable Price” TheoryThe purchase decision may be affected by the price relative to other household equipment. • Washing machine: $350 • Microwave oven: $300 • Vacuum cleaner: $200 • VCR: $250 • Video game console: $200 • 3DO Multiplayer at release: $799?

  16. “Household Use” TheoryThe location of the device in the house determines who will use it, when, and how. • Personal Computer • The family office; Adults and older children; Generally alone. Optimized for single-player use. • Video Game Console • Living room or child’s room; Attached to a TV; Young adults and children; Generally in groups • Interactive Television/Set-Top Boxes • The living room, attached to the family TV; Adults and children; Family group, together

  17. How Games are Built and Sold • The Publishing Company • Pays for games to be developed(Sometimes develops the game itself “in-house”) • Owns the completed game • Advertises the game to the public • Sells the game to retailers (or through distributors) • The Development Company • Has a contract with the publishing company • Builds the content: software, pictures, and sound • Earns royalties on the wholesale sales

  18. This Creates 3 Career Tracks • Production Track • At the publisher • Mostly administrative, partly creative • Development Track • At the developer • Mostly creative • Game Design Track • Can be in either place • Almost entirely creative

  19. The Production Track • Function is to assist and oversee thedevelopment process for the publisher • Primary talent required is “product sense” • Ability to know when a game is good(and how to fix it when it is not good!) • Don’t have to be a programmer, artist, etc. • Can start at the very bottom • Can go to the very top!

  20. The Development Track • Function is to build the game • Divided into specialties based on skills • Programming – the software • Graphics, artificial intelligence, physics, etc. • Art and animation – the pictures • 2D art & animation, 3D modelling and animation • Audio engineering & music – the sound • Recording, editing, music composition

  21. More on the Development Track • Can learn skills at university • Can start at a good salary • Promotion is limited unless you change track • If you are a great programmer... • The company will only want you to program!

  22. The Game Design Track • Game design can be at publisher OR developer • Three levels of design • Lead game designer (only 1 per game) • Defines the general nature of the game, player’s role • Game designer • Fills in the details about the game • Level designer • Creates scenarios (“levels”) that the player will play

  23. CareerTracks Warning: Job titles are not standardized in the industry and vary from company to company!

  24. We Aren’t a High-Tech Industry! • Electronics, biotech industries work differently • Very expensive products ($100,000 or more) • Direct contact with small numbers of customers • No “shopping season” to dictate schedule • Games are a consumer product • Products must cost $60 or less • Indirect contact with millions of customers • Schedule dictated by Christmas shopping season

  25. We Aren’t Hollywood! • Filmmaking is well-understood • 70 years of experience • Most people in film are subcontractors • Unions define job roles • Game development requires engineering • You cannot make a game without it • Each game is a unique piece of software • Engineering is problem-solving in new ways, so... • Engineering is not predictable

  26. Interactive Entertainment is Unique • Like high tech industries, we have engineering • Like movies, we have aesthetic content • Our audience is active, not passive • We must create a living world for the player • We entertain in many ways • Challenging the player to think and to act • Pleasing her senses with pictures and sound • Immersing her in linear and non-linear stories

  27. Some Bad News • Game companies don’t buy ideas • Everyone in the industry already has many ideas • You cannot patent an idea alone • Don’t get into the industry for the money! • Game programming pays 25% less than others • You may not get a chance to make your game • It is your job to make the game the company needs • The work can be very long and very hard! • Schedules are always unpredictable

  28. Some Game Industry Trends • New hardware is always coming • Game richness and detail is improving • Development costs are rising • 20-50 times what they were 15 years ago • Much competition for space in retail shops • Forces prices down • Games only stay on shelves a short time • Must sell hundreds of thousands to succeed • All this produces publisher conservatism!

  29. Limitations of Retail Distribution • Retail distribution is like TV before cable • Before cable, 3 big TV networks dominated the USA • Amount of content limited by transmission bandwidth • No concept of market niches • All shows had to appeal to all people (all equally stupid!) • After cable, many channels, many interests • History, sport, drama, music, news, etc. etc. • Retail game distribution forces all games throughthe narrow bandwidth of store shelves!

  30. Benefits of Electronic Distribution • No goods to manufacture • No shipping, no warehouses, no retailers • Shelf space on the Internet is infinite! • Small publishers can distribute as easily as big ones • Piracy is less of a problem • Game can be verified by a secure server each time • Can sell using many different payment models • Flat fee, monthly subscription, per-hour charges

  31. Problems of Electronic Distribution • Don’t yet have enough speed • Must be able to download 650 MB in 10 min • Not enough people have broadband yet • We don’t understand the psychology of thegame buyer • How important is the “shopping experience”? • Do retail stores offer something valuable? • People like to see boxes under the Christmastree, not just a URL!

  32. A View of the Future • Electronic distribution is inevitable • The cost-reduction benefits will be unanswerable. • The bandwidth will permit us to serve niche markets. • Graphics are no longer our primary selling point • We need to concentrate on new genres and worlds. • “Interactive Entertainment” won’t only mean games. • Microsoft is already researching non-competitive play. • Academic research holds great promise. • Will help the interactivity/narrative problem. • Will help the artificial intelligence problem. • Doesn’t have to be commercially viable.

  33. Overview of the Interactive Entertainment Industry Ernest W. Adams ewadams@designersnotebook.com http://www.designersnotebook.com +44-1483-237599

More Related