Casual Games are Killing the Industry

Casual Games are Killing the Industry

OK, so maybe that headline is a little melodramatic. But the topic of whether or not casual games are killing the traditional video games industry is certainly worth exploring given the continued rise of social network games, digital game downloads, smartphone apps and free online games while retail titles continue to decline in sales and prominence. Interestingly, it’s our friends at Fortune magazine doing the heavy lifting in recent article Is Casual Gaming Destroying the Traditional Gaming Market?, which takes a deeper look at the seismic changes currently impacting the gaming industry, with Game Theory contributor and Electronic Arts founder Trip Hawkins declaring the traditional business model “broken.”

While some – e.g. the always filthy-rich gang at Epic – may take umbrage at such sentiments, it’s a fair assessment of the current state of retail publishing, which faces tremendous challenges presently. Beyond heightened competition from social games, online games, MMOs, digitally distributed outings, iPhone/iPad apps and other cutting-edge offerings (many of which sell for less, are much easier to get into, fit better with users’ changing lifestyles and are sometimes completely free to play), we’re also seeing a massive drop-off in audience spending in the wake of the economic downturn. But more disturbing than the fact players aren’t ponying up as much for blockbuster outings as they used to are the fundamental shifts in playing habits (involving more mobile, bite-sized and instantly gratifying game experiences) that enthusiasts are becoming used to, and the fact that they’re being trained to expect more for less. Then, of course, you also have to consider the rising costs needed to build traditional outings, and support them on the back-end with piles of downloadable content (DLC).

All of which of course adds up to heightened risks, diminishing returns and bigger bets – not exactly what we’d call a sensible recipe for business success. Check out the piece for more insights, including Hawkins’ pointed contention that purveyors of classic blockbuster games are increasingly playing to an isolated audience, and at a massive price and organizational disadvantage to boot. It doesn’t pull any punches, and offers a surprisingly sound reality check that we recommend game developers and publishers alike take to heart.

About Scott Steinberg
Scott Steinberg is CEO of strategic consulting and product testing firm TechSavvy Global, and a noted keynote speaker and business expert. Hailed as a top tech expert and parenting guru by critics from USA Today to NPR, he’s also an on-air analyst for ABC, CBS and CNN.

2 Comments

  1. I don’t know about farmville taking away players from Modern warfare.. but I think there are creative ways to harness this new breed. What these games show us that a pay for parts model mixed in with a good reward system could make big bucks. Its not that Peggy wont spend 60-100$ on a game its that she wont spend it at one time.

    Now take a well developed shooter usually retailing for 60$.. Take out the high end content sell it as a “Platform” of some digital distribution network for 30$. Then sell new modules, weapons, abilities… add content to sell more!

    Stop selling CDs and start selling experiences.

  2. Nonsense. Casual and indie games are a reaction to the triple-A-obsessed business model, not the cause of it. If anything is killing the industry it’s people like Trip Hawkins and his collection of ivory backscratchers.

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