Comments on: Why most video games aren't profitable

Only 20 percent of all video games that make it to store shelves are profitable. Don Reisinger thinks he knows why.

[dascha1]

Ironically, the video game industry is beginning to look more like the music industry on a rapid scale - i.e. contacted a few on the "inside" who then reply by saying - "we have a policy not to accept new ideas as unsolicited material from the outside". Makes you wonder doesn't it?

[sticks1839]

I totally agree that we need better games, not more games in general; but I think you're confusing your numbers a bit or something. If shooters represent 10% of the market and 2 appear in the top 10 of games sold, then that's better than expected. No wonder so many companies keep putting out shooters. In the same vein, did you really compare the combined sales of 4 games to the sales of 2? Using those figures, the average top shooter sold 3.93 million, but the average of the other 4 is somewhere over 2.5 million. Sounds to me like shooters are the way to go, especially considering that the 4 other titles mentioned hold unique, not-easily-duplicated, places in the market.

[Blackmere]

Seriously. Where are the next gen strategy games? Why haven't we seen a new Civ type game? I mean something truly innovative. Spore tried I guess. It failed IMO but at least they tried.

[CDubber]

Game developers (and hardware manufacturers) need to start thinking creatively. The Xbox 360 relies on shooters and sports games. But gamers are getting tired with these genres - and the larger "casual gamer" market has no interest in them at all.

I recently bought Shaun White Snowboarding for my Wii, which works with the Wii Fit board. No, the graphics aren't high-def, but controlling the on-screen action by standing on the controls makes for an extremely fun gaming experience. Nintendo gets this - Microsoft and Sony do not.

[dascha1]

Good comment. I think you're on to something here, though somewhere along the way something got missed in this new media industry. I still remember, as a child, wanting to just simply 'talk' to Jeanie or Tony when they appeared on TV. I mean, a basic "hello" back to me would've been something tried at least. I don't think I was the only one who thought this either. That problem still exists today.

[mrgoodall]

pump your brakes their fella. MS has all their eggs in the shooter basket. As far as Sony, they have a broad base of "new idea" games, take a look at Little Big Planet and some of the PSN based titles. Really great for casual gamers. What the WII has done is brought the village idiot into the fold and made them spend money on the system and a few games, the problem they will face...where to store all those durn peripherals (wii motes, wii board, wii fish hook, wii chat, wii music wand, et al) and no, i'm not being facetious all the Wii accessories i've mentioned exist.

[aztec92154]

I agree with your comment as well. I lived the Atari -> Nintendo -> Super-Ninendo / Genesis -> Playstation / N64 Era... With every system, there was something different (2D to 3D was the shift). Playstation / N64 -> Playstation 2 / XBOX / GameCube / Dreamcast -> Playstation 3 / XBOX 360 / Wii there was a much smaller relative shift with Sony and Microsoft, a larger shift with Nintendo, and Sega is relatively dead.

[cporpheus]

I think you skipped over an element that goes into profitability: budget and time. It takes years for games to come to market and millions of dollars to make them. Although the quality of the game is important, it will not achieve profitability if it took a decade to develop a video game and a quarter of a billion dollars to develop it. (If you think I'm exaggerating, just look at Duke Nukem)

[ScottProdigy]

They'd sell more when gaming becomes another mass media object such as movies or music; and the sales suggest it is. When it reaches that level, and the prices come into line with DVDs or CDs, both of which take time and millions of dollars to develop as well, then the profitability may be there. Then again, Hollywood does lay a lot of eggs before they get their golden goose...

[bdanek]

I agree. Do you know why more people do not buy video game consoles? It's not the price of the console but the price of the games. Granted, prices on games eventually come down or you can buy them used but by that time they have lost some of their appeal. If video games sold for $20 or $30 for new releases the video game industry could really, really damage the movie industry.

[sign_me_up]

This is a conclusion that's often repeated by many editors, pundits, and consumers, but it's inaccurate and an oversimplification.

I've covered the game industry freelance for a number of websites for years and I even worked in the industry briefly. Each year there are plenty of titles that are released that are creative, new, and enjoyable, but they slip under most people's radars and those titles flop. If people really wanted these kinds of titles, they'd buy them...but they don't. Why?

There a number of reasons, but the industry structure itself is partly to blame. Game consoles are fairly short-lived devices and games themselves live even shorter life spans. Most games only stay on retail shelves for a few months or a year at most major retailers. If you want to find a game that didn't sell well at a console's launch, you'll likely have to head over to GameStop to find a copy. Availability and visibility thus becomes a problem, and means a game has only two real avenues to get a public's attention: via marketing (often expensive) and word of mouth (cheap, but hard to come by). Factor in the costs of making a game along with the time needed to (most console games takes 2-3 years, and the average console life span is ~ 4-6 years), there's not a whole lot of leeway to risk millions of dollars on an unknown product.

Besides, most consumers really don't want dramatically new experiences. They're fine with refined experiences of old, provided there's a new twist, stronger marketing, or some brand familiarity. The latest Pokémons don't dramatically alter the formula and the success of Guitar Hero and Rock Band has less to do with innovation, than with a marketing twist. Music games of their nature have been around for years (Frequency, Amplitude, SingStar, etc. etc), but it was when the games' appeal were broadened to American's affection for rock coupled with strong marketing, that helped propel the games into the mainstream.

What the industry needs in particular is the growth of an online structure and downloadable games/demos (akin to the iTunes Music Store), so consumers can try games, get centralized access, and gain availability to older games. This will help bring down costs, broaden the market, and help developers recoup some of their costs and potentially earn profits over a longer period of time, rather than being forced to deliver a sure thing to move off shelves within 6 months. We're starting to see some of it thanks to the growing availability of online play and new capable gadgets like the iPhone, and that's a step in the right direction.

[Matt_Tanous]

"it's time they stop wasting their time with more of the same and start moving towards better titles that offer something unique?"

Every time they do that, they don't sell well...

[bdanek]

This is so true. There are plenty of games that have tried to do something different but are never given the credit they deserve by the media.

[Angel_Rainn]

I used to enjoy all kinds of computer games and tried a lot of them. Of course due to my talent to get bored very quickly I never finished them. So, after a while instead of playing them I started to keep myself informed on news, latest games publishings and all the stuff related to games. Now I can find all the <a href="http://www.pcdistrict.com"> games news and reviews on PC District.com</a>.

[d--keller]

Speaking of new ideas... how many times are you going to write this same article Don?

Look, for the future of gaming it's important to get new ideas and games out there. I agree. We probably all agree, but why do you keep insisting that this ties in to profitability somehow? Look at LBP sales. By all accounts it has been a total flop. It's new, different, critically acclaimed... by your reasoning it should be a huge seller and a big money maker. But it's not.