The change in direction may be the most significant in the 16-year history of the show, said Brian Farrell, chief executive officer of THQ Inc., maker of the WWE wrestling titles. Photographer: Susan Goldman/Bloomberg
Facebook sleuths playing “CSI” will
share the spotlight with assassins at Ubisoft Entertainment (UBI) SA’s
E3 booth next week, the latest sign that video game makers
recognize the threat posed by lower-priced casual titles.
The annual Electronic Entertainment Expo video-game
conference in Los Angeles, once the muscle-car showdown of big
names and costly titles for mostly young males, is beginning to
showcase family fare targeting a wider audience.
Games that can be downloaded anywhere and played for a few
minutes at a time top many agendas. Almost 25 percent of France-
based Ubisoft’s 6,000 developers now create titles defined as
more casual, mobile and social, said Chris Early, vice president
of digital publishing. Makers of 99-cent iPhone games are
joining the competition for players’ time and money.
“Everything will be about social games” in five years,
said Keiji Inafune, who developed hits including “Resident
Evil” in 23 years at Osaka, Japan-based Capcom Co. Now
developing a social game, he predicted “smaller upstarts will
overtake established major publishers, who have treated them as
a bush league.”
U.S. sales of video-game hardware, software and accessories
declined 6 percent to $18.6 billion in 2010 as consumers drifted
to digital play from packaged games played on consoles,
according to NPD Group Inc., an industry researcher based in
Port Washington, New York. Global sales of social-networking
games played on PCs doubled to $1.4 billion, according to IHS
Inc. (IHS)’s ISuppli research unit.
Zynga’s Share
Games played on social networks are free at the start, with
publishers charging as little as a $2 for virtual goods that
help players advance to higher levels. Console games such as
Activision Blizzard Inc. (ATVI)’s “Call of Duty” shooting series cost
as much as $60 for a title, with additional revenue from
downloadable maps, weapons and other contents.
Zynga Inc., the biggest game operator on the Facebook Inc.
social-networking site, generated $544 million in revenue last
year selling virtual objects, according to ISuppli. The San
Francisco-based company controlled 39 percent of the global
market, twice the combined share of its four nearest rivals.
Nintendo Co., Electronic Arts Inc. (ERTS), Sony Corp. (6758) and other
longtime game makers are also reacting to upstarts such as Kabam
Inc. and KingsIsle Entertainment Inc., which are grabbing
millions of casual players on Facebook and the Web.
Electronic Arts, the second-largest U.S. video-game
publisher, today started a website, Origin, where players can
buy games online, play titles including “Scrabble” on smart
phones and interact with their friends.
Platform Yes, Console No
On June 7, Kyoto, Japan-based Nintendo will unveil its
“Project Cafe” console, a successor to the best-selling Wii.
The device is expected to showcase games in high definition,
include a new controller and deliver more online support for
casual gamers, said John Davison, vice president of programming
for San Francisco-based Gamespot.com, owned by CBS Corp. (CBS)
The day before, Tokyo-based Sony and Microsoft are
scheduled to outline their upcoming slates. Sony will provide
more details about its next-generation portable, expected to go
on sale late this year, according to Michael Pachter, an analyst
for Wedbush Securities in Los Angeles.
Microsoft executives have said they will emphasize that the
Xbox 360 console is a platform for everything from Netflix Inc. (NFLX)
streaming to Kinect motion-sensing control of Hulu LLC programs
– and not just for hard-core gamers.
Up to 40 percent of owners use the console for services
other than games, Frank Shaw, a spokesman for Redmond,
Washington-based Microsoft, said May 31 on the company’s blog.
Lower Prices
The change in direction may be the most significant in the
16-year history of the show, said Brian Farrell, chief executive
officer of THQ Inc. (THQI), maker of the WWE wrestling titles.
Companies that once focused on delivering games that cost $50
million to develop now must compete in an increasingly
fragmented industry, he said.
THQ, based in Agoura Hills, California, is tinkering with
different formulas to address that fragmentation. In May, the
company offered its new “MX vs. ATV Alive” motorcycle racing
game for $39.99, or $20 less than a typical console title.
Additional content, including branded vehicles, helmets,
goggles, graphics kits and new tracks are available online for
$1 to $5, keeping the game fresh for months and potentially
creating more spending per user, Farrell says.
THQ is also working on a game for Facebook and Apple Inc. (AAPL)
devices called “Margaritaville Online,” based on the Jimmy Buffett song. The company describes it “an immersive 3-D
paradise, filled with frozen concoctions, music and adventure.”
“We want to get our games into the hands of more players
by delivering things of value and creating brands people want
more of. It’s as simple as that,” Farrell said in an interview.
To contact the reporters on this story:
Cliff Edwards in San Francisco at
cedwards28@bloomberg.net;
Pavel Alpeyev in Tokyo at
palpeyev@bloomberg.net
To contact the editors responsible for this story:
Anthony Palazzo at
apalazzo@bloomberg.net;
Young-Sam Cho at
ycho2@bloomberg.net
Article source: http://www.bloomberg.com/news/2011-06-03/facebook-csi-sleuths-crack-e3-game-show-where-assassins-rule.html
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