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Friday, December 02, 2005

How can we improve Hardware Transitions?

Earlier this year, there were some in the industry who said that moving from one console generation to another has become as easy as stepping over puddles. They were wrong.
Earlier in the year, many were confidently predicting that we had it all figured out. Hard experience would help us through this console transition, in ways we hadn't managed before.

Now, it's become clear that sales of now generation games have not been as strong as many had hoped. While analysts say that overall sales will be up year-on-year, that is still dependent on a very strong December.

Also, the market has been helped by the launch of two handheld devices, effectively creating a new market within a market. But even those have failed to deliver much in the way of overall growth.

Retailers and publishers have been stepping forward in recent weeks, admitting that the 'environment' (read: game sales) has been weaker than anticipated.

This year we have seen few genuinely grandstand titles that have whipped up media and retail interest. Instead, most of the media's attention has been spent on products that don't exist - PlayStation 3 and Xbox 360. (Of course Xbox 360 does exist but, as far as third party publishers are concerned, it's not going to butter any parsnips this year. The numbers are too small and will likely continue to be so well onto next year.)

It hasn't helped that the industry has largely failed to create any genuinely remarkable games for either the now or the next generation. Looking back at E3, it's difficult to match the games we thought looked great, with serious retail movement. Perhaps King Kong is the exception.

I just popped over to Gamerankings to look at the most popular games. There are only five PS2 titles in the top 20 - 50 Cent Bulletproof (widely regarded as crap), Dragon Quest VIII (well reviewed but hardly a U.S. retail monster), True Crime New York City (another weak release) plus two franchise releases - a THQ wrestler and Need for Speed. Both these games are well made and will sell well, but it bodes ill for the industry if they represent the future of our business.

Investors are looking at games publishers and retailers and what they are seeing is a familiar picture of over-promising and under-delivering. It's not that individual publishers have messed up, (although few have distinguished themselves). It's more that we, as a business, have largely failed to excite our audience this year, with the products that are actually going to make a difference to the bottom line.

We saw the lines last week for Xbox 360; we saw the disappointed consumers, and with them the picture of a missed opportunity; how many of those 18 Xbox 360 games will hit forecasts now? And with consumers now fixated on the next generation, how many PS2 and Xbox games will under-perform as a result?

The fact is that, although we've learned a great deal about console transitions, we are a long way away from managing them faultlessly. They remain wide, difficult and treacherous crossings. And we're a long way from getting across this one safely.

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