The growth in popularity of free-to-play games may pose a challenge, but rumours of the demise of the gaming industry are way off the mark, according to those in the know
IN MARCH, when EA unveiled its Simpsons Tapped Out game for the iPhone, the demand was so great, the servers kept crashing.
EA was eventually forced to temporarily remove it from the App Store until it could fix the problem. Yesterday, it still wasn’t available again in the Irish App Store, although it has been reinstated in the US.
The crash highlights two things: consumers still love the Simpsons and all that comes with it, more than 20 years after the cartoon characters hit the screens, and free-to-play games are now incredibly popular with consumers.
That last point probably isn’t news to anyone who has been watching the industry over the past few years. The free-to-play model has exploded, partly thanks to platforms such as Facebook and mobile devices.
But what about the games industry? For years, studios and publishers have been investing time, effort and money into developing games that generate millions of euro in revenue. These days, you can log on to Facebook and play games without ever spending a cent.
When PopCap co-founder John Vechey confirmed that its Dublin studio was under threat in a blog post last week and that the company was reorganising its business globally, it cited the unexpected rise of mobile, social and the free-to-play model as examples of the changing industry. At its Seattle studio 50 jobs have gone, with layoffs reported to include senior members of the design team behind Plants vs Zombies.
The news that PopCap looks certain to leave its Dublin studio after six years, with the consequent impact on its 96 staff, came as a shock to the industry.
According to Forfas figures from October last year, there are more than 2,000 people working in the games industry in Ireland.
That figure has almost certainly increased further, with some high-profile additions that include the opening of EA’s Bioware support facility in Galway, an operation that employs hundreds.
But it was an indication that the games industry in Ireland wasn’t untouchable.
The closure of studios is commonplace in the business, says Richard Barnwell, formerly of Jolt and current chief executive of independent games studio Digit. However, because the industry is very much in its infancy here, such news came as a shock.
Games Ireland’s Paul Hayes says the current doubts surrounding PopCap in Ireland is not a reflection on the studio, but rather was a decision made on a strategic level. However, it is one that goes against the grain somewhat.
Although companies such as Zynga may be suffering a slump – Zynga’s shares have fallen 69 per cent since the flotation in December – it’s because they “soared so high for so long” rather than a reflection on the company’s fortunes, says Hayes.
Free-to-play doesn’t mean that a company won’t make any money. In fact, the industry indicates that the opposite is true.
“There’s so much more competition than there used to be. Five years ago there was a handful of games to look at. Now if you go to the App Store there are thousands, so why would a user spend €1 or €5 when they can download one for free and pay if they like it? People have become more used to getting things for free to try them,” says Barnwell.
“The whole industry has shifted to free-to-play very, very quickly. The reason it has is because you can make more money from doing it. It all depends on the platform and genre of game.”
Big Fish chief executive and founder Paul Thelen considers free-to-play (F2P) games a different proposition from the company’s premium games, as a new type of content.
“A well-designed free-to-play game is a different experience than a well-designed premium casual game,” he says.
“Our premium business continues to experience strong growth. We see F2P as an opportunity to embrace a new customer that is demographically similar, but play games for a different psychographic benefit.”
As far as Big Fish is concerned, the games are even designed differently, he says.
“F2P games are designed in a completely different way than premium casual games – both the game-play mechanics and the business model hooks. To be successful, a company needs to have teams that eat, drink and breathe F2P,” he says.
It’s not just social and mobile games that are grabbing attention. There is a debate over the future of the games industry as a whole, with speculation that the rise of such mobile games could eventually kill off the console.
At SXSW, the annual music, film, and interactive conference, last year, Rovio’s Peter Vesterbacka said console games were on the way out – although that hasn’t stopped the rumours that the mobile gaming company will release a version of its popular Angry Birds game for the main consoles later in the year.
“I don’t think they pose any threat – they’re fundamentally coming from different things. One complements the other,” says Hayes.
Mobile games have grown rapidly in popularity. But industry experts point out that these games are increasing the overall number of “gamers” rather than cannibalising from the console segment.
In turn, they have created a whole new market for games companies to tap into, one that has a wider age range, and wouldn’t necessarily consider themselves as “gamers” in the traditional sense of the word.
Plus, as Thelen points out, free-to-play may be a growth market, but it’s still not the norm in the industry.
“The premium business is still the vast majority of the $17 billion games industry. F2P is simply a new opportunity to address a new type of gamer,” he says.
While the Irish industry has its fair share of independent studios developing for the iPhone, iPad and social platforms, there are plenty of operations – larger ones – involved in the support of console and PC games.
“They are still going to be successful. Free-to-play works really well on mobile devices, on Facebook and browser games. On the console, it’s a completely different experience,” says Richard Barnwell, of independent studio Digit.
“It will be a long time before mobile devices are powerful enough to do what a console can – not just in terms of power, but also storage space.”
Other things to consider aside from storage space is the size of console games, how long it would take to download the latest blockbuster title, and the controller interface.
The next generation of consoles will tell the future of the market, says Barnwell.
If they have disc drives, you can see the console around for at least another five or 10 years,” he says.
TRADING PLACES: FROM FEE PAY TO FREE PLAY
SimCity
City builder SimCity has moved to Facebook, becoming SimCity Social and a free-to-play game. There are some changes, of course. You don’t have unlimited actions, for example, as you need to build up energy to carry out tasks. That means waiting for the energy bar to refill over time, picking it up as a reward for performing tasks, or asking your friends to help by sending you free refills. If all else fails, you can buy it – like most of these games, in-game purchases are always an option.
Bejeweled
PopCap’s Bejeweled has been around for a long time. Starting off as a browser- based game in 2001, it has now moved cross platform, with a version for the iPod offered in 2006. A web app version was unveiled in 2007, and a HTML5 version of the game was made available through the Google Chrome store in 2011. There have been several versions of the game since its launch, and it has already been downloaded more than 150 million times – with 75 million copies sold. The iOS version is a free download.
Sonic
The king of the Sega Mega Drive, Sonic has garnered a following on mobile devices too. Sonic CD was re-released last year on mobile platforms, bringing some retro hedgehog to Android and iOS. No fancy 3D graphics here, just fast, furious fun. You pay to download it, but at €4, it’s nowhere near the investment of your youth.
