Where Have All the Good Games Gone?

Where Have All the Good Games Gone?

Over the past couple of months, it has become painfully clear to me and many casual game fans that the quality and quantity of downloadable games is dropping. There are less games for download being released each week, and of those that are released, many are just not that good. Suffice it to say that the state of download games is in dire shape. And, unless changes do not happen soon, things will only get worse.

Before I talk about what’s going wrong, let me tell you what is going right in casual games downloads. The answer is, you, the game player. There are more people playing downloadable casual games than ever before, which is quite a feat during a worldwide recession. The growth in demand for download games is driven by lower prices, improved broadband speeds, and the fact that the primary audience that loves to play download casual games, baby boomers, is the largest demographic in the US right now.

So what’s the problem? While demand is growing (albeit slowly), the supply side is out of wack, moving the market out of equilibrium. Here’s the problem:

  • The price of download games has dropped in the past year from an average of $20 to $7 per game. That’s a 65% drop in price, meaning developers need to sell 2.5X more of each game to make as much as before. The demand for casual download games is growing, but at a much slower rate to offset the drop in price (my guess is 10 – 15% yearly growth).
  • There are fewer channels for game developers to sell their casual games, both offline and online. Retailers like Walmart or Target noticed the price drop online and either dropped their prices or stopped selling casual games altogether. There has also been consolidation online. For example, PlayFirst has partnered with Big Fish Games to sell games, and Reflexive is closing their Arcade product. Whereas there used to be hundreds of retail websites for developers to sell their games through, now there are only a few.
  • While the price per game has dropped, the amount developers earn per game has either stayed the same or, in some cases, decreased as margins get squeezed.

It does not take an economics degree to understand that the numbers simply do not add up. If developers are making 2/3 less per game and the amount of games sold is not offsetting that drop, the only way for game developers to earn their return on investment is to spend less time and money producing each game.

Whereas a game developer would have been willing to invest $300,000 and 6 months to develop a game in the past, now they can only afford to spend $100,00 and 3 months just to break even. The result is more derivative content (especially among hidden object games), less gameplay, and poorly tested/translated games with even worse grammar.

Moreover, many highly-talented game developers are leaving the download space altogether to focus on iPhone and Facebook games. With the iPhone, the cost of development is much lower and Apple only takes 30% of the sale. With Facebook, a decent trafficked game can make up to $50,000 – $100,000 per month. Game developers are not moving to the “hot” iPhone and Facebook businesses to make a quick buck; they are leaving casual game downloads to stay in business. And that’s a shame, really, because downloadable games are more popular now than ever before.

Fortunately, not all is dire in the world of download games. Companies are starting to re-introduce the concept of higher-tiered pricing with collections and premium edition games. There are game developers that continue to develop high-quality downloadable games (especially those with strong franchises) as well. New distribution channels and premium services are popping up to offer developers new ways to make money. And, with less competition, this is the perfect opportunity for game developers to jump back into the casual game downloads business, assuming they can make the math work.

Still, the fundamentals behind the downloadable games market are flawed and we can no longer stay silent. The first step in solving a problem is to admit that a problem exists, and for some reason, the entire casual game downloads industry is too scared to speak the truth.

The games need to get better or game players will stop playing. Game developers need to make enough money in order to invest the time and money to create better games as we’ve enjoyed in the past. And yes, game players need to be willing to pay more than $7 to play higher-quality games.

I’m not saying it’s possible to get the average price back to $20 per game. There are too many cheap and free games online, courtesy of free-to-play Web browser outings, Facebook and the iPhone. But, $7/game does not work. A desk for $1,000 made by craftsmen is higher in quality than a $200 desk you buy at Walmart made of particle wood. It’s the same with casual game downloads.

If the status quo does not change, we’re going to enter a vicious cycle, where lower-quality games lead to fewer game sales, which leads to less developers creating downloadable games, which lead to even less sales, and so on. And once the big fans of casual downloadable games get fed up, bored, and stop playing — well, then that is when it truly is game over.

Editor’s Note: To read more articles by Joel Brodie, be sure to visit Gamezebo.com.

About Joel Brodie
Joel Brodie is the founder of casual game reviews site Gamezebo.com, a leading online magazine which offers coverage of the latest game downloads, including news and analysis on the casual game download, social gaming and free-to-play businesses.

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