Task 3 - Financial, Industry, and Market trends
Financial issues and trends -
The Global Games Market Report in 2016 reports that gamers across the globe achieved a total of $99.6 billion in revenues, this was an improvement of 8.5% in comparison to 2015. It is the first time that mobile gaming such as IOS and android take a larger share than PC with $36.9 billion which is up 21.3% around the world. According to the results posted in April 2016, 58% of the growth of the market originates from the Asia-Pacific region, North America has second highest growth rate which generated $25.4 billion in 2016 alone. The pros to this is that if a company is looking to sell a game they may aim to sell their game in these regions. On the other hand, if the game is primarily sold to Asia then millions of people in the Europe area will miss out on a game that many of them want to play.
The game industry can go one of two ways depending on the decisions you make, it can go really well and you can make a lot of money or you can lose a very large amount of money and the company you've put all this effort into can go bankrupt.
The game industry can go one of two ways depending on the decisions you make, it can go really well and you can make a lot of money or you can lose a very large amount of money and the company you've put all this effort into can go bankrupt.
The first problem you would come across if you decided to start developing your own game would be that you (as the developer) would get whatever money is left from the profit from the game. A high percentage of the money the you make will most likely be going to you employees, distributors and publishers plus what other costs it has taken to start the company such as the office space, computer software and hardware, contingency (in case something goes horribly wrong) as well as countless others.
Budget also has a big role in whether the company goes bust or not, if the company has a much bigger budget then they usually create a much better game. For example, a company like Infinity Ward who have created a very good franchise in Call of Duty, they had a budget between $40 million - $50 million for Call of Duty: Modern Warfare 2, and a total launch cost of about $200 million, this included global distribution and marketing. They are more likely to produce a much better game than a team like DrinkBox Studios, who developed Guacamelee with their 14-person team.
Many companies that don't have the funds to start creating their own game use crowdfunding to get money, websites like Kickstarter are a big way that the indie companies earn their money. A good example of a game that was funded by Kickstarter is 'Wasteland 2' by inXile entertainment which had an initial campaign target of $900,000 but ended up earning $2,933,252 by April 17 2012. This shows that many people are willing to put their own money into a game and hope that it does well, another example of a company putting their trust into fans on Kickstarter is 'We Happy Few' developed by Compulsion games who put up an initially wanted $250,000 but ended up earning $334,754 by July 4 2015, the trailer for the game has been released at E3 but the game hasn't yet got a release date.
The bad side to Kickstarter could be if thousands of people put their own money towards a game that has been promised to be great and whatever the fans want but it could turn out to be the total opposite and the developers have taken a lot of the money and threw a scrappy game together or they could just take the entire budget set for the game. I believe that crowdfunding will continue to grow because it allows indie teams to keep up with companies on a certain level.
Many companies that don't have the funds to start creating their own game use crowdfunding to get money, websites like Kickstarter are a big way that the indie companies earn their money. A good example of a game that was funded by Kickstarter is 'Wasteland 2' by inXile entertainment which had an initial campaign target of $900,000 but ended up earning $2,933,252 by April 17 2012. This shows that many people are willing to put their own money into a game and hope that it does well, another example of a company putting their trust into fans on Kickstarter is 'We Happy Few' developed by Compulsion games who put up an initially wanted $250,000 but ended up earning $334,754 by July 4 2015, the trailer for the game has been released at E3 but the game hasn't yet got a release date.
The bad side to Kickstarter could be if thousands of people put their own money towards a game that has been promised to be great and whatever the fans want but it could turn out to be the total opposite and the developers have taken a lot of the money and threw a scrappy game together or they could just take the entire budget set for the game. I believe that crowdfunding will continue to grow because it allows indie teams to keep up with companies on a certain level.
Market Trends -
They way games games are distributed now is much different than it was 10 years ago, there much more ways that a game can be promoted and a lot more countries that are involved in gaming like Sweden who are more recently become more connected to the newest and best games, games like Just Cause 2 and Need for Speed Rivals were developed in Sweden.
Big publishing companies like Activision and Electronic Arts have a very good publishing teams to sell games like 'Call of Duty' and the Battlefield series, Adverts are a big way that these games are sold, adverts on YouTube, TV and billboards really help the game be sold to a large group of people, also targeting countries for the sales of the game is a big tactic for publishing companies.
Downloadable Content or more commonly known as DLC are in game transactions that are apparently there to make the game better when in reality it's just so the company gets more money. A big contributor to this was infinity ward's 'Call of Duty: Ghosts', if you wanted a space themed paint job on your gun or Snoop Dogg as your commentator then you would have to pay about £3 for something so little and irrelevant but if you have millions of people from the fan base buying a £3 camo then that adds up to millions being earned for the companies.
Pre-order bonuses are also a massive way that companies entice people into earning money at the promise of new and better items, an example of this is once again in the call of duty series, this time in Black Ops III, the Pre-order pack gets you personalisation packs which has custom weapon camo, multiple reticles as well as a calling card with and emblem item, furthermore they get advanced supply drops which have at least one weapon variant, one item of professional rarity or better and the chance to get exclusive gear. Pre-order bonuses are a good way for the company to earn money as well as a way as gamers to get new gear early. The bad side to this is that companies can lure people into buying something so easy, for things like camos that it takes the development team close to nothing to make and people are buying them for £3/£4.
Pre-order bonuses are also a massive way that companies entice people into earning money at the promise of new and better items, an example of this is once again in the call of duty series, this time in Black Ops III, the Pre-order pack gets you personalisation packs which has custom weapon camo, multiple reticles as well as a calling card with and emblem item, furthermore they get advanced supply drops which have at least one weapon variant, one item of professional rarity or better and the chance to get exclusive gear. Pre-order bonuses are a good way for the company to earn money as well as a way as gamers to get new gear early. The bad side to this is that companies can lure people into buying something so easy, for things like camos that it takes the development team close to nothing to make and people are buying them for £3/£4.
A huge way that companies have their game promoted are streaming sites like YouTube and Twitch. This example is more common within the last 10 years as there hasn't been anything like this before and now it is bigger than ever, YouTubers like KSI who has a 14 million subscribers PewDiePie who has 49 million have a massive contribution as what games are considered good and what games a flops. also live streams on twitch have a big contribution to how games are reviewed by gamers. The up side to this is that YouTubers and streamers can make a living online and anyone can do that whereas the bad side is that gamers are now letting other people make the decisions without experiencing the game for themselves. The trend of streaming will probably continue to grow over the next few years as it is a great way for people to see how the new games are played without having to do it themselves.
Industry Trends -
The game industry is always changing depending on what's new and how the product is represented. For example, the Kinect which came out with the Xbox 360 was a way for people to enjoy a game and stay fit without having the worry of the controller running out of battery. The Kinect feature for the Xbox 360 was very popular when it came out in 2010, in the first 3 years in sold 24 million units and was then later adapted to feature in the Xbox one when the console was launched. The good side to Kinect for the Xbox is that it keeps the player fit, there is also a feature to talk to people through face cam which was a good part to the design of it, on the other hand the Kinect was quite hard to set up and sometimes the tracker could connect to the body causing an abundance of annoyed gamers. The Kinect and motion capture feature will soon probably die down and become less and less popular until it is discontinued.
More recently, companies have brought out remastered games for gamers to try out, classics like 'The Last of Us' from Ps3 to Ps4 and 'Call of Duty 4: Modern Warfare' on all consoles, it is very popular at the minute because it an easy way for gamers to play their favourite games without having to re-buy old consoles, the graphics are better and its usually a better experience for gamers. in the case of 'The Last of Us' which was developed by Naughty Dog had 1.3 million units sold within the the first week of its release making it one of the biggest sales of a game in 2013. The when the remastered version came out it sold a reportedly 1.5 million units within 24 hours, it just shows how an amazing game can become a massive success despite already being sold on another platform. Remastered games remain a great way for gamers to enjoy games they previously played. On the contrary Remastered games can end up on the bad side because companies may be able to keep re-selling the same game over and over with the price of a new game which is ridiculous but in my opinion remastered games will continue to go on as it is an easy way for a company like Naughty Dog or Infinity Ward to become prosperous with the re-make of old games.
If a company's development team is behind the deadline, then they primarily use crunch time to get the game back on track. There are two main reasons that a company will have to use crunch time, the first is if the game is scheduled without enough flexibility then all it takes is one screw up to welcome an avalanche of mess with it brings 10-12 hour days. The other is deadlines, mainly for big companies if they set a deadline for a game, it is then set in stone, and if there a multiple mess ups during the development of the game it can set it back which costs money therefore crunch time fixes that and allows the game to be put out on time. The only good thing that comes from crunch time is that the game is released on time where as it causes stress to the employee who might not get home while 10/11 o'clock at night after starting at 9/10 in the morning meaning they are always tired and won't be able to be with their family much. It can also lead to mental health issues because of how much stress is being threw upon you. Crunch time, I hope will subside over the course of the next 10 years or less but for now I believe that crunch time will stay and there will be a lot of late nights for employees working in the game industry in the future.
More recently, companies have brought out remastered games for gamers to try out, classics like 'The Last of Us' from Ps3 to Ps4 and 'Call of Duty 4: Modern Warfare' on all consoles, it is very popular at the minute because it an easy way for gamers to play their favourite games without having to re-buy old consoles, the graphics are better and its usually a better experience for gamers. in the case of 'The Last of Us' which was developed by Naughty Dog had 1.3 million units sold within the the first week of its release making it one of the biggest sales of a game in 2013. The when the remastered version came out it sold a reportedly 1.5 million units within 24 hours, it just shows how an amazing game can become a massive success despite already being sold on another platform. Remastered games remain a great way for gamers to enjoy games they previously played. On the contrary Remastered games can end up on the bad side because companies may be able to keep re-selling the same game over and over with the price of a new game which is ridiculous but in my opinion remastered games will continue to go on as it is an easy way for a company like Naughty Dog or Infinity Ward to become prosperous with the re-make of old games.
If a company's development team is behind the deadline, then they primarily use crunch time to get the game back on track. There are two main reasons that a company will have to use crunch time, the first is if the game is scheduled without enough flexibility then all it takes is one screw up to welcome an avalanche of mess with it brings 10-12 hour days. The other is deadlines, mainly for big companies if they set a deadline for a game, it is then set in stone, and if there a multiple mess ups during the development of the game it can set it back which costs money therefore crunch time fixes that and allows the game to be put out on time. The only good thing that comes from crunch time is that the game is released on time where as it causes stress to the employee who might not get home while 10/11 o'clock at night after starting at 9/10 in the morning meaning they are always tired and won't be able to be with their family much. It can also lead to mental health issues because of how much stress is being threw upon you. Crunch time, I hope will subside over the course of the next 10 years or less but for now I believe that crunch time will stay and there will be a lot of late nights for employees working in the game industry in the future.
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