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ION: WildTangent's St. John Declares Consoles Dead, Claims PC Renaissance
ION: WildTangent's St. John Declares Consoles Dead, Claims PC Renaissance
May 16, 2008 | By Wendy Despain, Staff

May 16, 2008 | By Wendy Despain, Staff
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More: Console/PC



In this year's ION Game Conference closing keynote, WildTangent CEO talked about “The PC Gaming Comeback,” predicting the death of video game consoles and the rise of online PC gaming, as well as the increasing importance of monetizing games with advertisements.

St. John introduced attendees to WildTangent by noting that the company has the fourth largest private game network in the U.S., and said it receives 50 percent of its revenue from ads sold on both single-player and multiplayer titles.

Games As Unique Media

St. John went on to describe games as the only addictive media and the only extremely re-consumable media: “The value comes after or during consumption, not before. The game can be different each time it's played, unlike a movie. Games are the media of interactivity, making them uniquely difficult to interrupt.”

Consoles are Dead!

Beginning one of several brazen claims in his keynote, St. John spoke of the death of video game consoles: “Nobody needs a console when a game's value and DRM is defined by community or an input device. Consoles just serve to keep you from playing a game you didn't pay for.”

He asked, “What's Sony and Microsoft's motivation to make another console? It's been so rocky, and it's not about the pretty graphics anymore.” According to St. John, spectacular graphics have become a commodity, and not the platform for games to differentiate themselves. “The Wii is the exception that proves the rule -- it's not about the graphics, it's about the input device.

Online PC Gaming Renaissance

St. John speculated that we’re in the early days of an online PC gaming renaissance: “There's a wide open opportunity here. Anybody can get into this, and everything the traditional publishers and game companies know about doing business will ensure their failure.”

“There's no advantage to traditional game publishers online,” he argued. “The box game industry requires the money up front before they'll let you find out if it's any fun. Online, you get to try it before you put money down. And in that world, brand doesn't matter. Brand is the promise of entertainment, but now it's the experience that matters. Great games are best monetized after a consumer is hooked.”

Intrinsic Value Of Games

Further emphasizing the lessening importance of brand, boxes, and communities, St. John listed replay addiction, persistence, ease of consumption, and ease of payment as the elements he believes now make up a game’s value: “Every game has an intrinsic ‘value’ that can't be changed with great marketing. A game has a constant conversion rate. Marketing gets more people to look at the game, but the same percentage will buy it.

Imitating Television’s Advertising Model

St. John believes that at least 50 percent of the monetizable value of any premium game will eventually be in advertising, comparing future models to television ads: “Television is ‘free’ because the value of the content to an advertiser is greater than the capturable value of the content to the consumer.”

He continued, “Advertising does not cannibalize games sales when it is presented correctly, thus not designing a game to support advertising wastes 50 percent of its value.”

St. John presented WildTangent data, explaining that the 'average value' of a game comes to about $0.36 per session to a user, and about one dollar per thousand clicks (CPM) to an advertiser. Games with free and pay options will see about 50 to 100 times the audience playing for free versus those that pay, and players will visit a game 50 to 100 times over 120 days (excluding MMOs).

Who And How To Target

Contrary to many casual game audience theories, St. John said games targeting young males are amongst the more valuable to make, adding that console-type games get the highest CPMs, and saying the landscape needed more classic 3D console/arcade style games.

So how can developers maximize revenues from their games? Design your games to be consumed in small units of value, he said, and ask for advertising revenue share from your distribution partners.

Other suggestions: do play a video ads during the load time of the free play, but avoid interrupting game play with ads, avoid advertising in paid game play, and avoid "crapping up" the interior of your games with in-game advertising. "It doesn't work," concluded St. John. "It's a bad idea."


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Comments


James Hofmann
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I would agree with the general assessment, but would add that the "platform of the future" is likely to be Flash:



1. It's already dominant, and reaching gameplay with no download can increase the number of players by orders of magnitude.

2. It's been an open standard since May 1st of this year. There are already open-source implementations, they just need some time to catch up.

3. Companies like MochiAds and GameJacket are already doing a gangbuster business by allowing small devs to include short ads with relatively seamless APIs. (I would not be surprised if Google tries to muscle in on this business soon.)

4. The bytecode VM is one of the faster ones around as of Flash 9, and rendering's getting some basic 3d acceleration in its next iteration, Flash 10. Unfortunately, it's not the gamedev-friendly kind, it's been targeted towards graphic designers, but 2d rendering will be much less of a bottleneck now.



If you really want to get into online/browser-based gaming, there has been no better time than now.

Michael Black
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"Consoles are Dead!"



Yes, because the 200 people waiting outside the Nintendo store *every single day* aren't really there to buy a Wii. They're actually waiting for the bodega to open so they can buy a pack of smokes.



O_o

Anonymous
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He seems to miss some very key points about the attraction of consoles:



1) Hardware knowledge. Consoles are predefined hardware packages so anyone who does not know the difference between an Nvidia and ATI card, or even GeForce 7900 and 8900 will always know their game will run on a console.



2) In person socialisation. Consoles are played on TVs which means that you can bring over a bunch of friends, crowd round the TV and play games. Sure, you have online play, but some games are more fun when you can laugh at your mate in person.



3) Centralisation. Entertainment is becoming more centralised in homes with a multitude of devices being able to plug into the TV, including graphics cards. Consoles offer the ability to just switch the telly over to your AV channel and play, whereas a computer requires you to physically move to another machine. It's a bit speculative but there is a laziness factor in consoles that PCs don't offer in this respect.



I agree that online gaming, whether a distribution app like Steam or browser based, is the future. A lot of companies are realising this and while Flash has had an almost monopoly on browser gaming, many competitors are springing up (MS Silverlight and Java has one coming out), including wrapper pages that allow you to run executables through your browser (.NET WPF, and things like Yo-yo games' Firefox Addon) so it will be interesting to see where things go from here.

Shaun Huang
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Hm... i wonder... If Logitech had released the wii-mote coupled with the same exact Wii Sport junk, and same amount of marketting, would it have fared just as well? There would def be more games on the table given the awesome number of freelance dev on PC, but would the hardware sale spike as hard as Wii did?



Hm... maybe Wii succeeded because it didn't market itself as a game device but by selling itself as something completely different, in which case it probably shouldn't even be counted as part of "console GAMING." *shrugs*

Anonymous
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I dunno but I've found the trend is exactly opposite. 90% of the gaming I do personaly and that most people I know do is all done on consoles mostly because it's so much easier and, in the end really, cheaper.



To buy a computer I'd need to play most of the pc titles coming out right now, I'd need a lot of money. If I spent this money on consoles instead I could afford a LOT more bang for my buck. Even with a ps3 I could still buy more games and overall fun gaming wise with the cost of a good computer and a pc game put towards a console.



And the most annoying thing would be that the game wouldn't even be garunteed to work on the pc when I was done where as most to all console games are proven on their hardware.

flv converter for mac
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if A game has a constant conversion rate. Marketing gets more people to look at the game, but the same percentage will buy it.

flv converter for mac
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If a game has a constant conversion rate. Marketing gets more people to look at the game, but the same percentage will buy it.

avchd converter
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Entertainment is becoming more centralised in homes with a multitude of devices being able to plug into the TV


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