The Traditional Model is Suffering

Yesterday GamePolitics ran a story covering Fortune's article on videogame takeovers. As Rolf Winkler and Rob Cox of breakingviews.com report, "With their business models under threat and shares in the doldrums, video game publishers like Electronic Arts look ripe for the picking by larger media conglomerates such as Walt Disney."

Contributing to the environment is, of course, the economy. However, the success of social gaming is both a symptom of the current climate and a factor aggravating the wounds of traditional game publishers. EA recently announced that it would be released fewer, but better games. While this scaling back of content is a sign that media conglomerates might be able to move in and make some hefty purchases, I wouldn't say that it's an entirely desperate move. As Winkler and Cox explain:

Publishing video games is like making movies: Invest millions developing titles and pray for blockbusters. As in Hollywood, the trick is to establish successful franchises and regularly ride them to riches. Studios look for the next Harry Potter. Game publishers search for the next Call of Duty.

On the other hand, social gaming requires a lot less investment in individual titles, especially at the start. Here quantity -- generally at the expense of innovation -- is a dominant factor. It isn't surprising that traditional published like EA have to move away from a model like that, and personally, I don't think it's upsetting, either.

It's silly to drop all the time and resources to produce a well-polished but terrible game. You can either be the dexterous indie developer that blows everyone's mind with their quirky innovation, or you can funnel millions into creating a breathtaking, blockbuster experience. There is rarely room for middle ground.

I fully support EA's decision to let the smaller companies do what they do best. Their purchase of Playfish shows that they're willing to get into the field of social gaming, without making the mistake of pitting their big titles against the likes of stuff you play for 5 minutes a day on Facebook.

Teaser Trailers: Not Just for Movies

I've been talking a lot about animations and videos done to promote videogames recently, and today Kotaku covered a new "teaser" out for an unknown, upcoming FPS.

The name of the game and gameplay will premiere during the VGAs on December 12 at 8pmET/PT on Spike. A Halo: Reach trailer is also scheduled for the broadcast.

Teasers are an excellent way to build viral buzz, if done well. Cloverfield is a great example of this for the movie industry. Mystery can become allure very quickly, and 2K Games (the folks behind BioShock, Civ IV, The Elder Scrolls: Oblivion, and many other blockbuster titles) is hardly a small-time player.

And when you've got that kind of industry clout, why not exercise it in a less conventional way?

EA Drops $300 Million to Pick up Social Gaming

(Image courtesy of Kotaku.com)

I posted some time ago about the rampant success of social games like Farmville, and this is just a quick update in that realm. Techcrunch, Mashable, Kotaku, and PaidContent each ran a story yesterday on EA Interactives's purchase of Playfish for $275 million up front and $25 in "equity retention arrangements."

On the advertisement front, Playfish games clearly have much of the same appeal as successful games like Farmville: they are sugary sweet, colorful, and utterly playful. Like feel-good movies and mass-market paperbacks, this type of advertising easily draws in people where more typical gaming markets may not reach. Games on social networks, along with innovative practices by traditional gaming companies like Nintendo, are expanding the gaming market from being very genre-specific, to being something that everyone can feel good about enjoying.