|
Casual as you like
July 2006 (first appeared in Develop)
Following last month's column about innovations in
console gaming, I want to discuss the casual gaming opportunity in more detail.
Based on our current figures the casual gaming market in
North America and Europe will generate just over $900m in 2006, marginally ahead of the MMOG market in these territories. Casual games downloads via console represent a miniscule fraction of this and will continue
to be dwarfed by casual PC gaming for the foreseeable future.
Xbox Live Arcade and Sony's forthcoming eDistribution
system represent a simple evolution of the casual gaming model from PC to console. It's natural for the traditional gaming industry to look on casual gaming on console as a new opportunity; the console is their
territory, and in contrast to their normal multi-million dollar production budgets, knocking off a quick, cheap XBLA title looks like a quick win. .
The problem is that XBLA and eDI (Sony's new
abbreviation) are already, or will quickly become, heavily congested. Although they are channels to market with theoretically infinite width, as mobile games channel operators will attest, there are practical limits
to the number of games that can effectively be marketed and sold through a games deck. Indeed, the stats generated so far suggest that online sales of casual games are actually more concentrated around the top 10-20
titles than they are for retail product.
Competition for premium space (or even any space) on
XBLA/eDI will therefore be fierce. There are already several hundred dedicated casual games developers out there, some of whom (e.g. PopCap, Game House) have been around for many years and have substantial,
successful portfolios. Almost every publisher I have spoken to recently has also indicated that they are developing not just one or two but, in some cases, numerous titles for XBLA/eDI. Others have indicated that
they actually view these channels as marketing rather than revenue opportunities and will happily offer them as a loss-leader if it means propagating brand messages and selling more console titles.
Whilst this does not rule out the best quality indie
games making it to the top of the deck, it will be increasingly tempting for Microsoft and Sony to base their selection criteria on revenue and profit potential rather than gameplay quality (the two, as we all know,
are not the same).
Luckily, there are other distribution opportunities.
Indeed, there will be around $900m of opportunities within the PC market alone this year if you know where to look.
Download sales can be offered direct to consumers and
a host of DRM companies (e.g. Macrovision) can provide assistance from technology-only to fully-managed services. Hundreds of destination sites offer premium download services (e.g. RealArcade,
ShockwaveUnlimited) and the most successful games can often be found on dozens of services. Casual games can also be offered through Games-on-Demand service providers (e.g. Exent, GameTap).
However, the largest sub-sector of casual gaming
remains based around advertising and this is the principal business model of many of the biggest games sites such as Zone and Yahoo! Games which attract tens of millions of players each month. A few of these
services have also successfully established subscription-based adjuncts to their business models, charging monthly fees for premium casual games services.
Pay-per-play gaming (covered in an earlier GIC column)
offers an additional and fast-growing distribution channel and, despite offering very similar content, is dominated by companies outside of the other casual gaming sub-sectors (e.e. Skilljam, King.com).
Finally, there are casual games brokerages such as GameTrust and Arkadium that distribute titles through dozens of channels and exploit a variety of the above revenue models.
Indie developers seriously looking to take advantage of
the growth of casual gaming should therefore look first to the PC market and then to the console market although they are clearly not mutually exclusive. Reliance upon the console market alone is inadvisable
although any foray into the PC market should be done bearing in mind the difficulties of business development and portfolio management within a market with such fragmented distribution channels. .
|
