The Home of Sanner
Friday, September 25, 2009
Total Possible Realism (TPR) - 100% of Total Possible Realism is a perfect representation of a sports TV broadcast. I say that because you cannot get 100% of total realism from experiencing anything from any type of a medium whatsoever. So we are going with the TPR in our studies.
Development Resources and Development Costs - The resources a company throws a game be it manpower or money for technology.
Fun Factor - Fun Factor is a totally subjective rating, but I'm trying to consider what it means from the gaming audience as a whole. There is no concrete way to measure this, so I'm running with what I got.
So there are the three terms, define in a more concrete fashion. Hope you enjoyed this week's blog series!
Thursday, September 24, 2009
Doug Creutz, a market guru, did not see a deal as highly likely, "There is simply no way the math works due to the massive hit to EA's revenue and earnings post acquisition. This is even assuming such a deal would pass regulatory muster, which we find highly doubtful."
The only reasoning for Microsoft wanting to buy EA would be to make EA titles first party titles, but the price of admission probably wouldn't match the benefits given. First off you would have to figure out the licensing issues of EA's biggest sellers, as many of EA's exclusives such as the NFL, NCAA Football and their movie titles would have to be examined to make sure such a deal would fit within the framework of the agreements. I doubt EA/Microsoft would retain many of their licenses since they probably act under the conditions of EA being a third party multi-platform publisher.
Secondly, 89% of EA's GAAP earnings came from non-Xbox platforms, so the bottom line earnings potential really isn't there for Microsoft. A bulk of EA's earnings actually occur on the PS3 (19%) and Wii (25%), both of which are direct competitors to Microsoft's XBox 360 console.
So when you put it like that, you see how a Microsoft bid for EA is not only illogical, it actually makes little sense for Microsoft. So for now, I'm going to declare this as either an incredibly stupid set of business decisions about to happen or just another unfounded rumor, with more weight on the latter.
Posted on September 24, 2009 at 01:15 PM.
Yesterday, we looked at how development costs and possible realism were related in terms of how the cost of developing a more realistic game increases, perhaps exponentially, as you go up the scale. Tomorrow we are tying all four graphs together and I'll get a lot more concrete with what I'm talking about, but we're going to stay in the land of theory for one more day.
In this graph there is quite a bit of information which I'm proposing in here, so bear with me as I break it down. First is our little red line, which as development resources (and thus costs) increase, the possible realism increases to a certain extent. At some point, which I'm proposing is around 70-75% of total possible realism, the addition of more developmental resources become less effective in making a game more realistic (law of diminishing returns in economics).
I point out that very aspect with my vertical line and the arrow in the graph. Basically, this graph shows that realism goes up until it hits a point somewhere, then development resources become more costly (from yesterday's graph) to make games more realistic.
Next, we have what I propose here as the cap for realism on consoles today, which is around 90% of total possible realism. I've gotten a couple of PMs asking what I mean by total possible realism, and it's a good question. 100% on my scale would be a perfect simulation of a broadcast of that sport on television. Since we are dealing with an electronic medium in the TV, we'll never be able to simulate a sport perfectly as if you were the one playing it.
Phew! Ok, we're done with the abstract theory, I promise! Tomorrow I'm going to quit throwing abstract ideas and numbers out and start getting more concrete to tie all this together and explain why it's important. In the meantime, how interested do you think developers are in making games as realistic as they possibly can be? Are there any specific games you see as making a bigger compromise in realism in order to remain accessible to the masses?
Wednesday, September 23, 2009
This chart compares the relationship between development costs and possible realism. As the realism goes farther up the scale, the cost to produce that realism rises exponentially so by the end of the chart, you can see it is inherently costly to produce a game at 100% realism (literally off the charts).
Keep in mind also, on Tuesday I said that the relationship of possible realism and fun was maximized somewhere around 80-85% on the possible realism scale. So when you look at the graph above, you see the cost to develop that realism has already begun to rise exponentially. So at some point where we are close to right now, developing for more realism results in not only a much more costly game, but one which just doesn't appeal to the average gamer.
From a business standpoint, it really makes no sense to go much farther than where we are at from a gameplay perspective. Refining things and making the game play better at the current level of realism makes much more sense. Graphics and animations and presentation still have a long ways to go, but you are getting at the 'too costly to produce range' in regards to gameplay.
So what do you think? How much farther can developers go up the scale on gameplay? Will they ever get to, say 90% realism? Does this chart make you long for the days of 16 bit sporting titles like it does me? Sound off!
Posted on September 23, 2009 at 04:07 PM.
With all the chatter out there on video game takeover rumors, all involving EA as a buyer or seller, I think something is going on in the background.Consider the rumor going around Wall Street which bumped EA's stock up 8% on the 'news' Microsoft is interested in EA. There is also the rumor that EA is interested in buying THQ. As of this writing THQ is up 1% and Microsoft is up 1.3%.
And you thought the buyout rumors were so 2008.
There are several things to factor into the credence of these rumors. First, only EA's stock has gone up substantially on the rumor of Microsoft being interested, but THQ is rising as of this writing. That tells me people consider there are some legs underneath both rumors. Second, the EA/THQ deal seems to be rooted in EA Sports having a lackluster year sales wise and EA wanting to bolster that part of their lineup, which makes sense. However, everyone is having a lackluster year sales wise.
With the video game market slumping and with several companies operating under the assumption we are on the cusp of an economic recovery, which may or may not be accurate, I could see some big moves taking place just because companies will be able to be acquired at bargain level prices. And let's not forget buying EA would be a huge coup for Microsoft as EA games would almost certainly become XBox exclusives (which might or might not void those exclusive licensing agreements).
If nothing else, the rumors are going to get a lot bigger before they go away. Fasten your seatbelts?
Disclosure: I do not hold any positions in either THQ, Microsoft or EA.
Tuesday, September 22, 2009
Towards the end of the graph, the rate of fun factor acceleration begins to decline a bit. I think that at some point in the development resources vs. fun factor relationship, you start to lose the effect that dollars give you because, at least in my opinion, the difference between a 90 to 100 on a review scale is a bit bigger than 80 to 90 is. So at some point, you lose the benefits of the additional resources as they become more expensive to raise the quality of the game from the perspective of fun factor.
Tomorrow we are going to get into the part where OSers really should start to care, realism. But for today, what do you think about Fun Factor? Do you think at some point it becomes harder and harder to make a game more fun? And is it even possible to measure such a subjective form of measurement? Let's discuss!
Monday, September 21, 2009
At some point, the game simply starts becoming too hard because it's too realistic. In order to make a product for the masses, you have to make a game which A)will sell to the masses and B)seems ultra realistic but probably isn't even close.
You achieve A by not developing a fully realistic game but only a game around 80-85% realistic. You can achieve B by simply working on the small graphical touches and such to make the game look real, but play a bit easier than the real game. At some point, you can get too realistic to have a profitable product because the masses will deem the game 'too hard' or 'unfun'. So basically, I think that line is somewhere around 80-85% of total possible realism.
So what do you think? Where is your line where a game goes from being fun to just too freaking hard to be any fun? I'm personally a bit above where the graph shows, probably around 85-90%. Do you think the graph is somewhat representative of reality or do games continually get more fun the closer to realism they get? Sound off!
Friday, September 18, 2009
1)Possible Realism
2)Fun Factor
3)Development Resources
I'm not sure where we'll ultimately be led...but I've got four graphs for you to digest right now. Here they are...we'll discuss them more in detail starting next week! We might even add one or two!
Fun Factor vs. Possible Realism
Fun Factor vs. Development Resources
Possible Realism vs. Development Costs
Development Costs vs. Possible Realism
Tuesday, September 15, 2009
Posted on September 15, 2009 at 12:03 PM.
I had a nice one month or so vacation from writing so I could get the first draft of a book written. Now that the first draft is done and I'll largely be editing from here on out, it's time to start writing about sports video games again.This blog has no real point except to touch on a few brief points and hopefully raise some questions.
-I'm STILL playing MLB 09: The Show. That is a full six months after release, and I'm still playing the game. Something tells me The Show is getting my vote for Sports Game of the Year here at OS. Now that the air is settling a bit, which game do you like most so far?
-Madden NFL 10 is a good game, but I think they are a bit disappointed in the sales so far. Call me a cynic, but that's what happens when the industry you are working in is suffering from a severe pullback in sales overall is it not?
-Jayson Young gave NHL 10 an 8.5. I have yet to play NHL 10, but I am guessing that I will probably enjoy it again based on Jayson's review. However, I'm going to wait on some opinions of NHL 2K10 to come in, I might just pick that one up as an alternative. We will see.
Ok, three random points, I feel like I'm getting better here. I never really got to give Gaming in the Recession a proper look, so look for me to really breakdown that topic over the next few days. I might even present some fun charts or something!
Monday, August 10, 2009
However, I am very impressed at the (so far) critical acclaim Madden NFL 10 is getting. Not only that, but OSers who own the game are overwhelmingly giving the game positive marks so far. There are dissenters in the bunch, but I honestly think that only the most die-hard and bitter 2K football fans will find reason to hate Madden NFL 10.
For the rest of us, Madden NFL 10 looks to be (finally) the series' arrival on next-gen. It certainly took long enough, and I'm sure many will attest to that simple fact, but the bar has been raised even within Tiburon itself. NCAA Football honestly looks bush league at this point compared to Madden, as Madden is now easily more than a year ahead of NCAA.
As with all titles, it is still too early to tell if Madden is truly a game of the year type of game at this point, but the early returns are similar to our past winners. That has to have the folks down in Orlando smiling from ear to ear.
Thursday, July 30, 2009
The first and most obvious thing that happens when revenues drop in business is that expenditures also tend to drop to compensate so you can maintain a profit. If the declining sales become the new normal, studios will begin cutting back on positions which aren't necessary to see games completed. The second option would be to cut actual projects which aren't as profitable. And the third option is to cut down the sizes of existing projects.
That third option is particularly scary for us. What if the size of development teams for sports games was cut 5-10%? How much of an impact on innovation and quality would be come to expect? Those are all questions which cannot be answered, but we do know sports game developers have an almost impossible time putting out bug free releases each year in the current environment.
So what do you think? Is there reason to worry about our favorite titles? Are you buying games like you normally did? Sound off!
Tuesday, July 28, 2009
The one thing you will almost certainly see are the less profitable gaming projects being sidelined, possibly forever. What type of titles are less profitable are pretty easy to identify. For sports gamers, just think about games like NFL Head Coach, Virtua Tennis, or MLB Front Office Manager. With less revenue to go around, companies won't be willing to take the same risks they have over the last five years or so.
If you look at how companies made money in 2Q 2009, it was not by increasing revenues (sales). Almost every company across the board cut costs big time in order to beat expectations on Wall Street. Video Game developers are seeing a similar type of drop in revenues (~30%) as other industries, and will likely have to cut costs to stay profitable in this tough time. That means fringe development projects will be eliminated, and development teams will be downsized in order to meet that demand.
Economists are, at best, mixed in their outlook for the remainder of the year. It is anyone's guess about how things will work out. However, for each quarter this downturn does go on, that means more and more potentially profitable -- but yet very risky -- projects will be turned away. As for the effect on current projects or the bigger projects, we will dive into that tomorrow.
How do you think developers can cut costs but keep developing games which might not be as profitable?
Whether this is a long term trend or not remains to be seen. However, it certainly could be bad news for video game developers and publishers. Through the next few blogs I am going to be looking at some of the possible long lasting effects the fundamental change of less sales could bring to video game developers, and how sports games could either benefit or not over the coming years.
I'm by no means an expert economist. In fact there is an inside joke that meteorologists only retain their slight bit of credibility because economists exist in the first place. However, I think the issues which will be presented are real, and could very well have a profound impact on the games we love moving forward. Stay tuned as I look at several categories over the coming week!
Monday, July 27, 2009
Here are links to both EA's chart and Take Two's chart from the last two years: EA & Take Two.
Looking at both charts I think a few things are apparent:
1)Take Two stockholders are probably not too happy that they declined EA's $26 a share offer, as the price is now down around $8 a share. After the buyout news hit, Take Two's stock shot straight up and then subsequently, when the offer was withdrawn, the stock plummeted.
2)While Take Two stockholders might be singing the blues, EA's stockholders are probably feeling a bit of relief that they didn't buy Take Two for the price listed just before the craziness began on Wall Street last fall. Not only was the price they were offering way too high in retrospect, but EA would be dealing with a much tighter pocketbook right now thanks to the deal.
3)Sports gamers got the good end of the deal out of this, as we got to keep the 2K brand of games around, and EA is much better off financially than they would have been with video game sales now down over 29% year over year.
Disclosure: I do not hold any positions in either company.
Thursday, July 16, 2009
- You have to decide earlier when to pitch on option plays. Last year (and every NCAA before it) I would simply pitch the ball at the last second. You can't draw defenders in anymore and then pitch.
- Even more so than last year, you can't use speed burst all that often if you want to have a successful running game. Old habits indeed die hard.
- I have found man to man coverage works better than zone most of the time this year, unless I'm playing Boise State. Then it doesn't matter.
- Using line stunts is a must to get to the QB this year. The pass rush is inherently weak, so you have to use everything you can to get to the QB.
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