2009 was another year full of notable events in the games industry, some more unexpected than others. It's the evolving landscape of the games industry that facilitates the most interesting developments -- expanding markets, new ways to deliver games, the rise of social networks, and new packaged good strategies will provide new opportunities for more big events in the years ahead.
But here are five of the most notable events of 2009, chosen because of their potential or immediate impact on the parties involved or on the industry as a whole:
5. Doom and Fallout In The Same House
When Bethesda Softworks parent Zenimax announced in June that it would acquire fiercely independentDoom and Quake creator id Software, pretty much everybody was caught off guard. Even id's resident programming maverick John Carmack couldn't have predicted the acquisition: "I would've been shocked too, if a year ago you said Zenimax would acquire id Software," he told Gamasutra shortly after the deal. "First of all, I would've said, 'Who?'"
But once the initial surprise of the deal wore off, the synergies made sense: Bethesda had recently ramped up full-scale publishing of its own titles, meaning it could save 18-year-old id the trouble of striking publishing deals on a per game basis. With Doom 4 in development, Carmack thinks that Bethesda can "change the world" with the game, if Bethesda's resurrection of Fallout is any indication.
Bethesda is also a well-capitalized company -- a good thing for the security of an independent loner like id Software, which by itself could find itself in serious trouble if one of its high-budget games were to underperform. With Bethesda and Zenimax backing id, we should keep a closer eye on the Doom house, which is already ramping up its growth, at the same time promising it will maintain its creative identity under the umbrella of Zenimax.
4. OnLive, Gaikai Promise To Change Distribution
The announcements of remote server-based game services OnLive and Gaikai brought the buzz-term "Cloud Computing" to the games industry in a major way in 2009. And if the services work as advertised once they launch, they could change the way that we get our video games.
While they differ in important ways, the idea is the same: a game's audio and visual processing is done on a remote server, which then streams that to a user's computer. Control input from the user is sent to those remote servers, which purportedly relay information fast enough to reflect that input in-game in real time on a user's screen.
That kind of technology would mean that a user wouldn't need high-powered local PC hardware that is capable of running high-definition 3D games, because the remote server would be handling all of the processing.
The business model for OnLive, expected to launch yet this winter, will be subscription-based. OnLive already and support from several major game makers including EA, Epic Games, Take-Two, Ubisoft, THQ and others.
Gaikai is a cloud-based service fronted by industry stalwart David Perry. While it also uses remote servers, the business strategy is different -- game publishers would use Gaikai's tech so that users can go directly to a publisher's website, click on a game, and play it within a web browser.
The implications of such services could be huge: publishers could deal more directly with their consumers, used game sales going forward would be non-existent and there would be no more need for expensive PC hardware and game consoles. All you'd theoretically need is a broadband connection and willingness to pay for and receive games in a non-traditional manner.
And while there is definitely skepticism on whether or not such services will work as advertised -- cost and lag are two important issues -- the basics of the services do work. It's just a matter of seeing how they perform under real-world circumstances.
3. Electronic Arts' $300 Million Playfish Buy
Electronic Arts' $300 million acquisition of social network gaming studio Playfish is a deal that marks a major change for one of the industry's publishing giants -- perhaps the biggest change in EA's 27-year history.
The November buy represents megapublisher EA's gradual yet deliberate shift from packaged goods to service-based digital products. Playfish is a key part of that shift, as the London-based studio is responsible for the popular Pet Society and other games that are playable on social networking sites such as Facebook and MySpace. EA is already talking about using Playfish's know-how to bring popular EA franchises over to the social space.
Unfortunately, this shift from a packaged goods focus to online comes at a price. The same day that EA announced the acquisition of Playfish, it also announced it would be cutting 1,500 jobs. These cuts -- about a year after EA announced 1,000 previous layoffs -- included the shutdown of Mercenaries house Pandemic, a studio that EA acquired in fall of 2007.
Just days after the Playfish and layoffs announcement, EA CFO Eric Brown was candid about the publisher's motives behind the moves. "It's no coincidence that we simultaneously announced a cost reduction in connection with the acquisition of PlayFish, because that represents, in our mind, a very important shift to digital direct," he said.
Moving forward, EA will still be a major player in the packaged goods market with games like Mass Effect 2 and Dante's Inferno coming up, but EA hopes to significantly bolster that business with Playfish-related initiatives and other digital-direct opportunities such as downloadable content, digital distribution and subscriptions. And with BioWare's upcoming MMORPG Star Wars: The Old Republic on the way, we'll likely see another important step in EA's efforts in the online arena.
2. Modern Warfare 2 Deploys, Delivers Big Sales
Anybody who keeps tabs on the games industry knew that Activision and Infinity Ward's Call of Duty: Modern Warfare 2 would be a big commercial success once it released on November 10. But the true commercial impact of the game didn't begin to sink in until the sales reports started pouring in.
First there was the report out of the UK that claimed Modern Warfare 2sold 1.23 million units on day one in the UK alone. Then Activision said that the game raked in $550 million in its first five days worldwide, as Activision CEO Bobby Kotick boasted that the game is "largest entertainment launch in history and a pop culture phenomenon." The game drove Call of Duty franchise sales to over $3 billion, Activision later said.
When November sales numbers from NPD Group came in, we saw the impact the game had on the U.S. market -- between the Xbox 360 and PlayStation 3 versions Modern Warfare 2, the title sold over 6 million copies in its opening month
By comparison, Infinity Ward's last hit, Call of Duty 4: Modern Warfare, released on November 6, 2007, and sold around 2 million units in the U.S. during its opening month. That game has sold over 13 million units to date, a milestone that its proper sequel is on pace to pass, despite a little controversy.
The controllers are an acknowledgment that improvements to video game hardware need to be more than just a boost in horsepower every five years. It's also an acknowledgment that Nintendo had the right idea with the Wii.
But these new controllers have potential to capture new audiences with an approach different to Nintendo's. Like the Wii, Microsoft's strategy is also aimed squarely at the mass market, but Project Natal will incorporate a 3D camera with a built-in mic in an effort to make gaming more accessible for the average person. With the release of Project Natal, Microsoft hopes to redefine the Xbox 360 experience by offering high-definition controller-less gaming.
Sony's to-be-named motion controller is more akin to the Wii's setup -- it incorporates a wand-like pointer combined with a camera that enables depth-sensing. But Sony isn't positioning the motion controller as a mass market grab, but an alternative means of control that can get more core gamers to accept motion control.
Game publishers are counting on the two control solutions to act as re-energizers for the current console cycle, helping push the Xbox 360 and PS3 beyond the typical five-year console lifecycle. An extended console cycle is a scenario that would have the most immediate, widest-reaching impact on the games industry, and the new motion controllers are poised to be the impetus behind such a scenario.
But the proof will be in the software, and 2010 will paint a clearer picture about whether the new motion controllers are boom or bust.