Category Archives: Business

The Xbox One X makes a lot more sense in 2018

Ben Kuchera, Polygon:

The ability to play classic games in 4K is one of the most interesting, and sometimes under-discussed, features of the Xbox One X. The system currently provides the only way to play the first Red Dead Redemption in 4K, and doing so is absolutely worth your time. The list of Xbox One X-enhanced games that are backward-compatible isn’t huge — there are currently only 21 as of this writing — but there are some jewels in there, from the original Mirror’s Edge to Portal.

I bought a 4K HDR TV last weekend. My first thought after purchasing it was, “PS4 Pro or Xbox One X?”

Thankfully for my wallet, the original PS4 supports HDR, and that’s more meaningful than 4K in my book. But had I owned neither, I’d be all over the Xbox One X.

While the breadth of catalog isn’t there, there’s certainly enough for my casual needs. But most importantly, for cross-platform games, I’d know I’m getting the best console experience on the market. That’s tough to swallow for a snob like me.

Between (enhanced) backwards-compatibility, early adoption of cross-platform multiplayer, and unmatched performance, I agree with Kuchera. This will be a holiday to watch Microsoft.

Storytelling. Corner.

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Hunch: Nintendo Revives “Super” Branding

Moments ago, WSJ broke news that WSJ breaking Nintendo news.

Earlier this evening, after seeing reviews for Super Mario Party emerge, it dawned on me the appropriateness of the “super” brand in an era of mid-cycle console refreshes. The Super Nintendo Entertainment System was a next-gen console at the time, but “Super” now feels like a supreme version of an existing console.

My crack-pot hunch is that this new Switch will be named the “Super Switch” (as opposed to “Switch XL”) and will feature a larger display (smaller bezel), richer speakers, better kickstand placement, and Bluetooth headphone support at a minimum. Just a hunch.

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There are too many video games. What now?

Excerpts from Steven Wright’s Polygon Cover Story, emphasis my own:

Everyone can make games, but be realistic. … It used to be that you could do something that nobody had ever seen before, or you could do something familiar really well. Now, it has to be innovative and have incredible quality.”

Games are surely easier to make than ever before. Easy for me to say as I’ve never made a game, but I have to believe that today’s technology has decreased the barrier of entry to development. That’s not to say it’s easy to create a good game. Like any good art or media, that is an incredibly difficult feat.

The tech to create games is more accessible than ever. Formal eduction to learn how to make games has become readily available. The distribution of games becomes increasingly easy via tools like Epic’s Unreal Engine which allows developers to “more easily ship games and seamlessly optimize gameplay across platforms.”

For those developers creating online experiences, the choice and complexity of platform to develop for and release to shrinks ever more with cross-platform play becoming increasingly popular.

It begs the question there is inevitably one experience everywhere, how do the plethora of games become seen? I believe indies will come to depend on large publishers for marketing budgets to cut through the cruft. But those publishers will be increasingly looking for guarantees on their investments. Not a chance on a new indie title.

When Finnish studio Housemarque released a twin-stick shooter called Nex Machina into the wilds of Steam in 2017, it didn’t exactly expect the game to to set tills alight. Even with those lowered expectations, however, the team behind the acclaimed defend-’em-up Resogun found itself shocked at the lack of impact that the Housemarque name seemed to have on the droves of consumers scrolling through Steam every day. When the sales numbers finally trickled t in — Housemarque declined to discuss specifics for this story, but SteamSpy and this recently patched achievement leak puts the number slightly below 100,000 copies sold as of summer 2018 — the mood was somber, with the studio’s head of publishing, Mikael Haveri, describing it as “devastating.”

The past few games I’ve played (and enjoyed!) on iOS have been published by Annapurna Interactive. The brand has made its impression. I couldn’t tell you the developer of any of these games.

The frequency at which a publisher for multiple developers can get its brand in front of the player is far greater than any indie developer. Recognition by saturation.

If the publisher is able to consistently publish top-notch experiences, they also become a trusted curator of which players will seek new titles.

If a developer seeks to have the same level of recognition, they are absolutely required to create something “innovative and of incredible quality” to compel a player to invest in their complete experience, thus building a relationship. The longer the experience lasts, the deeper the relationship becomes.

Blizzard and Epic have created addictive experiences that continue pull players back in over and over, again and again, for hours on end; drilling their brand in with each launch of the game as well as their proprietary launchers and stores.

Nintendo iterates on familiar and successful franchises to deepen the association of a particular IP to Nintendo, thus deepening the player’s relationship with and trust in Nintendo. Should a new Nintendo IP comes along, chances are those with a relationship with Nintendo will give it a try. And because Nintendo consistently creates stellar experience, the trust will likely grow.

Capybara Games released an innovative title of incredible quality for iOS in Superbrothers: Sword & Sworcery days after the iPad 2 was released — arguably the first experience of its kind. The title was of novel design, mysterious, tonally unique, integrated social sharing to encourage peer-to-peer marketing, and was immersive and long enough to draw players back in through to completion during the early days of a platform. While Capybara may not be a household name, their design and tone is now familiar.

All of this said, the chances of a developer becoming a household name are far slimmer than a publisher who’s essentially become a curator. The same could be send for indie record labels and film distribution/production houses.

Devolver’s Nigel Lowry says that although many industry veterans and gamers alike think of the gaming market as a finite amount of money that hungry consumers are willing to spend in a given time period — say, this bloody holiday season, which is particularly awash with high-profile franchises that must duke it out, such as Assassin’s Creed and Red Dead Redemption — in the past few years, it’s become apparent that the limiting factor isn’t measured in dollars, but hours. In a climate where every game is stuffed to the gills with five tiers of colored loot, massive open worlds, reams of optional content and a dozen content patches lurking on the schedule before the core package even hits store shelves, it seems that game developers are battering each other harder than ever before to compete for the attention of games worldwide.

“Even if the most hardcore gamer plays 14 hours a day, that’s still a finite amount of time,” he says. “And if you’re spending 10 of those in a PUBG, or a Fortnite, what does that leave for the rest of us? It’s true that timing of release is critical, sure, and I don’t think that single-player, smaller-scope games are going to go away; there’s always going to be room for that. But time is something that you really can’t move, and you have to account for that when people move into these long-term relationships with games.

See Self-competing and Time Blocking.

I truly don’t know what the future of indies is, but it doesn’t look great.

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Cross-platform play coming to PS4, starting with Fortnite

Ben Kuchera, Polygon:

Sony has finally stopped fighting the future: A beta for cross-platform play, including support for Fortnite, launches today.

“The first step will be an open beta beginning today for Fortnite that will allow for cross platform gameplay, progression and commerce across PlayStation 4, Android, iOS, Nintendo Switch, Xbox One, Microsoft Windows, and Mac operating systems,” PlayStation president and global CEO John Kodera wrote on the PlayStation Blog. “We see the beta as an opportunity to conduct thorough testing that ensures cross-platform play is best on PlayStation, while being mindful about the user experience from both a technical and social perspective.”

This is a major reversal of its longstanding policy of keeping PlayStation fans segregated from the rest of the industry, after arguing that cross-platform play might even be unsafe. Others in the industry had argued that the policy was due to monetary concerns. Many publishers, including Bethesda, had been pressuring Sony to make this change, and developers such as Psyonix have already spoken openly about how easy the change would be to implement from their end.

This is industry shaking news. With this breakthrough, cross-platform play will become a new norm.

Not to belabor the “console wars”, but I suspect this will encourage deeper investment in first-party exclusives (Nintendo’s game) leading to more studio acquisitions (Microsoft’s new game), as well as bigger deals for third-party exclusives (Sony’s game, traditionally).

Finally. Finally. Finally. Finally.

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The Nintendo 3DS and the Importance of Ports

Viewers of Nintendo’s 9.13.2018 Direct were witness to a treasure trove of future Switch titles. To name a few:

  • Animal Crossing
  • Luigi’s Mansion 3
  • Mega Man 11
  • Final Fantasy VII, IX, X, X-2, XII ports
  • Yoshi’s Crafted World
  • New Super Mario Bros. U port
  • Diablo III
  • Civilization VI

But the one announcement I keep coming back to is the 3DS port of Kirby’s Epic Yarn — a 2010 Wii title — in the form of Kirby’s Extra Epic Yarn.

This is not the first Nintendo home console port to the 7-year-old portable console — Donkey Kong Country Returns (Wii), Xenoblade Chronicles (Wii), most recently Captain Toad: Treasure Tracker (Wii U), to name a few — but it was the first during this Nintendo Direct. Shortly after, a port of the GameCube launch title Luigi’s Mansion (2001) was announced as a marketing tactic fix to hold fans over for Luigi’s Mansion 3 on the Switch.

Current sales numbers of the Switch reflect that of the hugely popular PS4. But even with that success, it’s fascinating to see Nintendo port back-catalog console titles to it’s aged handheld. The telling reason is the 3DS’s continued sales numbers, continuing to post 6.4 million units sold during Nintendo’s fiscal year 2018 ending March 31, 2018 alone.


It’s one thing that Wii U titles are seeing new life on the Switch — Mario Kart 8, Hyrule Warriors, Donkey Kong Country: Tropical Freeze, Captain Toad: Treasure Tracker — but it’s even more interesting the see the same tactic for a device that third-party support has all but dried up.

Nintendo sees continued life in the 3DS — a 2017 version in the New Nintendo 2DS XL is probably one clue — and seems to have found a method to maintaining the growth of an already stellar catalog with it’s own IP.

Short of the minority who still own a Gamecube or Wii, there is no other place to play Nintendo titles like Kirby’s Epic Yarn, Luigi’s Mansion, Donkey Kong Country Returns, or Xenoblade Chronicles — all of which have or will have a Switch sequel. If you don’t have a 3DS/2DS, these games may be attractive enough to pick one up on the opportunity to play or replay alone. But even for existing owners of the 3DS/2DS, this stable of first-party ports are certain to whet appetites for their Switch sequels.

The 3DS is a brilliant promotional tool for the Nintendo Switch.

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Xbox All Access Pass hardware, software, and services subscription

Ben Thompson, Stratechery Daily Update:

That noted, it is not too difficult to imagine this program morphing into something much more significant in the ninth-generation, which is due in 2020. I’ve already discussed the anticipated shift to streaming, at least for some titles; that, naturally, fits a subscription model perfectly.

What is particularly compelling, though, is idea of assuming regular hardware upgrades throughout the generation. Microsoft could, of course, simply charge its best gamers for those slight upgrades every time they come out, but what if instead of financing new consoles the model was more akin to leasing? Pay one monthly fee, get access to online services, streaming games, and new hardware every few years?

Consumer hardware as a service.

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Bloomberg Businessweek: The Legend of Nintendo

Felix Gillette:

More symptoms emerged in November, when the company released the NES Classic Edition, a miniaturized, rebooted version of the Nintendo Entertainment System, the console that had made the company a household name in Europe and America in the ’80s. The updated version was carefully calibrated to rekindle the latent passion of lapsed fans, with 30 of the most popular NES games built in. (Unlike the original, there were no cartridges.) From the start, supplies were scarce. Stores were constantly sold out, so customers lined up for hours to await shipments of even a few units. But what seemed to some like a supply-chain disaster looked to others like a calculated strategy. At $59.99 per unit with no additional games, NES Classics were a low-margin item; much more important for the company was to whet the world’s appetite for Nintendo games in preparation for the Switch. To that end, Nintendo and DeNA also released Super Mario Run for iOS and Android, giving hundreds of millions of people an opportunity to help Mario scamper across their smartphones or tablets.

The strategy worked. By the time the Switch arrived in the spring of 2017, legions of people had been enticed to reconnect with their favorite childhood game characters on a proper Nintendo device. Over the next fiscal year, the Switch accounted for $6.8 billion of revenue. Nintendo’s existing handheld platform, the 3DS, kicked in an additional $1.7 billion, and sales of smartphone games rose 62 percent, generating $354.9 million.

This is a fun write-up on the current state of Nintendo — from its headquarters to the injection of young talent to its now iconic business ebbs and flows. To toot my own horn, I think it works as a macro companion piece to my micro view in Big-N’s Big Year.

Needless to say, I’ll forever be tickled by major news outlets covering Nintendo and video games at large. It’s a no-brainer considering the size of the industry, but for someone who grew up in a time where video games were a niche, nerdy hobby, it’s extraordinary to watch a company like Nintendo become as culturally significant and observed as Disney.

(Link via MacStories)

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Nintendo Tops E3 Tweets

Rishi Chadha, Twitter:

A look at the most Tweeted about topics during the annual event offers a fascinating glimpse at what got gaming fans most excited.

  1. Nintendo (@Nintendo)
  2. Xbox (@Xbox)
  3. Super Smash Bros. (#SuperSmashBros)
  4. Fallout (@Fallout)
  5. Playstation (@PlayStation)
  6. Kingdom Hearts (@KINGDOMHEARTS)
  7. Ubisoft (@Ubisoft)
  8. Elder Scrolls (@ElderScrolls)
  9. Death Stranding (#DEATHSTRANDING)
  10. Fortnite (@FortniteGame)

These were the most Tweeted about newly-announced games:

  1. Super Smash Bros. Ultimate
  2. Kingdom Hearts 3
  3. Fallout 76
  4. The Last of Us 2
  5. Death Stranding

These were the moments that generated the most conversation on Twitter:

  1. Super Smash Bros. Ultimate release date is announced
  2. Ridley announced as newest character added to Super Smash Bros. Ultimate
  3. Elder Scrolls VI trailer is revealed at @Bethesda press conference

I felt Microsoft’s conference was the most compelling, but this is pretty neat.

I’m curious to see how Nintendo handles social for Smash Bros. Ultimate. Social is Nintendo’s Achilles heel. I’m not sure how great Twitter is as a global barometer, but I think this is good motivation for Nintendo to double-down on it as a focus.

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Sometimes Failure Leads to Opportunity

Ben Thompson, Stratechery:

I’ve been pretty critical of the Xbox over the years, arguing that it failed at its strategic goal (winning the living room not just for gamers but for everyone) and didn’t make sense for Microsoft in the long run. Microsoft, though, has continued to insist that it was committed to gaming, and it backed that up at the ongoing E3 game conference.

First and foremost, if you’re not paying for Ben’s Daily Update, you’re missing out on the best business x tech analysis out there.

Ben’s latest regarding Xbox is a great snapshot of Microsoft’s motives for the future. Here are some choice quotes to summarize.

On Microsoft’s big acquisitions announcement of studios Ninja Theory (DmC: Devil May Cry, Hellblade: Senua’s Sacrifice), Playground Games (Forza Horizon), Undead Labs (State of Decay), and Compulsion Games (We Happy Few):

The Xbox One originally lagged behind the PS4 this generation due to its misguided focus on the living room (including charging $100 more at launch because of the now-discontinued Kinect that was at the center of that effort), but the bigger problem has been a lack of exclusive titles relative to the PS4. One way to counter that is to simply produce them yourself, and these purchases augment Microsoft’s ability to do just that.

On Microsoft’s announcement of a game streaming service, “dedicated to perfecting your experience everywhere you want to play — your Xbox, your PC and your phone”:

Still, PlayStation Now requires a PS4: what EA and Microsoft are talking about is a service that works on any device, from a phone to a smart TV to a PC to a console, because all of the computation is done in the cloud, and that right there is where the Xbox suddenly starts to make a lot more strategic sense: Microsoft has a massive advantage in a future where games are predominantly cloud-based.

Ultimately, I think Ben summarized the Microsoft showcase perfectly. I do hope you read it. To end:

Indeed, I find this idea so compelling that I must formally withdraw my recommendation that Microsoft get out of gaming; I still believe that the Xbox was a failure in terms of its original goals, but sometimes failure leads to opportunity, and streaming seems to be a significant one, for both Xbox specifically and Azure generally.

I have to say, the Xbox event was my favorite of E3, with Nintendo in a close second. With that, I truly think Microsoft has turned a storytelling corner.

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