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Winds of Change: Ben Cousins on Today and the Future
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Winds of Change: Ben Cousins on Today and the Future

March 15, 2013 Article Start Previous Page 3 of 3

What do you see as the future landscape of games? Five years ago, it was pretty straightforward -- you had publishers funding things, then those games came out on consoles or PC, and that was pretty much the way you did it. But that top-down model doesn't work so well anymore, and it's much more bottom-up but with a threshold. Because we have all these great technologies, but if Apple takes a chunk, Unity takes a chunk, your other middleware all take a little piece, that limits your success in a different way. So with that in mind, what do you see kind of like the development map of the next five to ten years to be?

BC: I think, and the other cost that you missed there -- which is vital and is invisible to people that don't realize it -- is acquisition cost, where you have to pay companies for users, right? And the majority of the games that do well on Facebook, on mobile, have had their users acquired by on a cash basis, where that installation costs you X amount of dollars.

I think that we will, if I think about how the industry was structured in the '90s and early 2000s I think we'll have something similar, where there will be lots of independent developers and of a medium size of like 20 to 30 people. And their route to the consumer is basically curated by some platform companies, medium-sized platform companies, and these will be companies like Facebook, like GREE, like DeNA, like Valve, right?

And then sitting on top of that you're going to have these big, kind of powerful, conglomerated companies like Apple and Google and Tencent. In recent years the console business became very much about exclusivity, first-party games in a kind of vertically integrated business, right? Where you make the software, it runs on the hardware and it goes all the way up to the top and it's all complete in the end by Microsoft or Sony, so that's like Naughty Dog or Bungie or whatever. And then things will spread out again, and they'll probably end up being vertical again at some point in the future.

But I think the next five to ten years will be these Mojangs and Halfbricks, these companies will expand to be 20, 30, 40 people. And they will do deals around distribution with social networks or digital distribution organizations, and then they'll be running their hardware on these high-end devices.

So it's much more like you'd have a Lionhead and then you would have an EA, you know, you'd have a small developer and then you'd have an EA-style publisher, and then you'd have Microsoft as a hardware manufacturer, kind of '90s, 2000s model. That's kind of how I see things. That was kind of a fun time to be working on games, I think, and there was a lot more freedom of experimentation, and less autocratic rule from the top down than there is nowadays in the console business.

Scattered Entertainment's The Drowning

It has been interesting watching these older companies trying to turn around. And EA has tried really, really hard by buying up these companies and doing these things to try to get into the digital space, but they've had to spend a lot of money to do it, and it's not yet very profitable for them.

How long do you think that kind of publisher is going to exist in the world? Personally, I feel that their relevance is decreasing rapidly, as their value add is really being boiled down just to money now. If console goes away, their value add of quality assurance and doing all the TRC stuff is going to be diminished, and it's really just going to come down to money and marketing. What do you make of all that?

BC: When I was at EA, the public view -- and it was also used internally -- was that they would transform EA from a packaged goods business into a digital business, and they would always talk about higher margins on digital. And for me that was never really going to be viable, I don't think, just because of that cost of transformation. For me, the best case for a company like EA is just to survive it, at the moment. And you look at how the traditional revenues are declining and digital is increasing, but the top-line revenue is basically staying static.

I mean that's not a profit growth, right? The digital side of the business has outpaced the packaged goods decline in order for them to get growth out of it. I think EA are in the best place of all the traditional publishers to survive, but we're not talking about big players. I don't think that any of the indie publishers at the moment will be big players in 10 years' time; I think there will be either companies that have just emerged or whom haven't been founded yet. Ubisoft, I think are in a really dangerous position, and Take-Two are in a dangerous position, THQ obviously aren't going to be around for much longer I don't think. [Ed. Note: this interview was conducted immediately prior to the ultimate shutdown of THQ.]

Sega also.

BC: Yep.

Well, most of the traditional Japanese game publishing business has decreased.

BC: Yeah. I mean, what we see are the smart Japanese companies like Square Enix are actually generating most of their growth from partnerships with companies like GREE and DeNA, actually, in the mobile space where they take their IP; Final Fantasy Brigade would be a good example of a game from Square Enix which has been successful.

But again, it's that transformation. The first order of business is to maintain your revenues, and then after that you can start to think about growth. But you know, the cost, just getting EA to whatever it is now -- 20, 30 percent digital revenues -- is sort of a cost in that growth; it's extremely expensive.

Article Start Previous Page 3 of 3

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