ICO Partners

It’s well known that online games have been shortening the value chain, threatening the roles of middlemen such as publishers, distributors and retailers, and enabling developers to get in direct contact with players. However, as some very interesting discussions pointed out a few months ago, acquiring users (call it marketing, or traffic acquisition) is hard and expensive, which lends considerable power to other actors in the chain, such as:

• Digital distribution sites, like Steam
• Platform managers
• Aggregators, like Miniclip
• Community and media websites
• Ad networks
• SEO-savvy “gateway” portals (MMO lists, etc)

Channels like these have grown greatly in influence, and the conditions of working with the most prominent ones are becoming increasingly expensive (some of the biggest aggregators now ask for either lots of cash, or equity).

Since bringing a user in can end up taking quite a large part of that user’s LTV in your service, it’s not really surprising to see game developers/operators trying to cut these costs by becoming or investing in media themselves, as Dofus’ developer Ankama is currently doing — they just announced that they’ve bought a minority stake in French website Gameblog (link in French) after investing in print media company HP/MP, web TV outlet Nolife and their own games magazine, IG Magazine.

Meanwhile, many websites that command a lot of traffic are moving further down the value chain. Some are getting into affiliation, which is the raison d’etre of portals such as MMOLife’s. Others are entering into channeling deals: sevengames (an arm of media group ProSieben in Germany) has gone this route, as has Bigpoint, offering client-based games by GOA and Gamigo, and more recently, Free Realms. Portals Buffed and MMOABC are getting into game publishing, while German site Gamona and Romanian portal Computergames.ro are becoming distribution channels for payment codes and mobile payments.

As time passes, it will be interesting to see the barriers between the different steps in the chain begin to blur. Some links will move up while others move down. How long before properties commanding huge amounts of traffic start buying developers, or the other way round? How far will the integration go? Please don’t hesitate to share your thoughts in the comments.

Developed in Spain and presented as an MMO for kids, there hasn’t been much noise around Planet 51 Online. The wikipedia page of the movie doesn’t mention it, there has been one article on it in the media in the past month (and it is the announcement about the fact they use the Trinigy Vision Engine), and the launch of the game was pretty low key, but since yesterday, the game is “live”. While the website isdefinitelypresenting the game as fully developed and ready to go for mass consumption, the client is bearing a Beta flag.

The game is accessible and playable. Theteam behind it is composed of ex-Pyro developers with experience of gamedevelopmentprocesses; the stability of the online components remains to be proven, but they have some game background. The very concept of building an MMO on the basis of totally fresh film IP, though, is quite brave. Movie IPs are fickle by nature and have short life spans (compared to online games), with the rare exceptions coming largely as a result of sequels. A Shrek MMO, for example, would seem like a safer bet compared to something brand new.

UK pre-paid card for Planet 51 Online

Additionally, film IPs also tend to be built around their plot rather than around their world, which is quite different (although not necessarily incompatible) to what a MMO/virtual world requires. With Planet 51, there is a suite of offline games built around the IP, allfullypromoted as the US release on 20th November draws nearer, however the MMO has hardly been promoted at all, and that’s strange. It seems to undermine all the work they have done to set up the distribution of pre-paid cards in retail outlets (in the UK, they could be found in major supermarket chains before the game was available). Maybe this stems from the fact that long-tail MMOs require different timings than one-shot, launch driven promotions forfilms (and traditional, offline games) - making cross promotion really tricky to properly set up. Even considering that though, it’s still hard to believe that an MMO project would be left to pick up speed entirely on its own.

We wonder how much the producers simply succumbed to the lure of the MMO space, thinking that this is now a mandatory sub-genre or a platform and the same way that you need a DS game, you also need an MMO nowadays to be taken seriously. That’s erroneous and potentially very costly thinking. MMOs make their revenue in the long-term, and require regular maintenance and updates over a span of years. They require a high degree of commitment in terms of development and marketing, especially kids’ MMOs (an overcrowded space serving an audience of players with short attention spans).

Cross-media projects are great, but to integrate an MMO component, they need to be very well thought out and built with a sound concept from the beginning. As such, TV-shows are much better suited to support a virtual world, as are book series and comic books. Feature films have potential as MMO fodder, but as single entities they can only provide so much material. Without a Big Plan to support the franchise, or to further develop the MMO independently, film IPs would probably be better served by building partnerships with existing virtual worlds, rather than building new ones from scratch.

All this being said, no doubt the Planet 51 Onlineteam have plans beyond what can be seen at the moment, and we wish them success.

It was announced yesterday that Runescape’s developer Jagex has cancelled its big scifi next project Mechscape. Without knowing any details about the project itself or the extent to which it’s been tested, it’s difficult to comment, but it’s a convenient time to share a few thoughts about when calling it quits is a good decision, and when it’s not.

The first element to take into account is that an online game has a lot of ongoing running costs. Launch is just the very beginning, and online games is not really a field where you can make a quick buck and run away by releasing something which can never become great (as happens quite frequently in the offline games industry). Sunk costs are by definition already lost, and the damage you might inflict to your brand by launching a lemon may not be worth the limited money you can gain by selling boxes or lifetime subscriptions upfront. If you’re in it for the long haul, as most online games developers are, cancelling might be the best option.

On the other hand, if a project that’s been in development for a long time is in such a bad state that the best course is to can it, that’s probably an indication that something within the development process is not working right. Perhaps the troubled game been developed “in a bubble”, with features and costs piling on without any input from players. When this happens, it’s not uncommon to discover shortly before release that the current state of the game isn’t satisfying, and often the development process is too rigid for appropriate responses to be taken as a result of player feedback and metrics.

Unless you have artificial constraints (such as a box release) that put a lot of pressure on the launch, the game doesn’t have to be ‘perfect’ as long as 1) it’s basically a good experience for players, and 2) you have a framework in place to allow it to evolve and thrive. Releasing a good quality minimum service should be the focus, while keeping the processes agile enough to grow a community. The best approach is to listen, learn and react quickly to the feedback players give you. Lowering the pre-launch investment also makes it less risky to experiment, which is another key support for learning. There’s a curious dichotomy here: if start-ups are getting extremely good at learning (primarily because they have no other choice) and their games grow successful as a result, it’s a bit puzzling to see bigger companies knocking themselves out to “get things right” at launch, and shying away from the very attitude that may have helped them succeed in the first place.

The Jagex article states that the previous game (I guess talking about Runescape) “wasn’t a game the team wanted to play”. Which is actually fine, unless the development team is your target market! Delaying a game’s exposure to players is like doing improv comedy when no-one’s watching, or dungeon-mastering an RPG using only NPCs: if you don’t give people the chance to experience what you’re doing, you can’t know if they like it or not, and in the case of online games, not knowing can be very costly.An online game is a dynamic, almost living thing; there’s no such thing as ‘finished’ until you pull the plug, and a successful online game is really a team effort between the developers and the game’s community.