Retail vs digital @ Rock Paper Shotgun

Last week I did an interview with Rock Paper Shotgun. I don’t know yet what the journalist used from the interview, but I’m a little bit ill at ease, because I shouldn’t have done the interview in the condition I was in, having had a sleepless night. Anyway, they posted an excerpt to announce the interview, and that generated quite some reactions already, so I wanted to post the link here.

Update: The full interview is online now here.

The topic is digital vs retail, and my position on it is that if you’re an independent developer, and you’re doing digital only, you’re missing out on a lot of revenue. I wrote a bit in the comments section to clarify the point.

  • http://www.facebook.com/Dragonseekers Sergei Klimov

    Digital vs Retail 

    should be 

    Digital TOGETHER with Retail

    The problems of traditional retail are the problems of the execution, not of the concept. There are still great music stores, e.g. EMPIK in Warsaw, Respublika in Moscow, that offer you the advice and the choice, and I’d rather drive there than browse iTunes full of fanboy comments to everything.

    I’m confident that if in a major city there would be a games shop that would have knowledgeable personnel willing to suggest something to me, recommend, comment – I’d shop there just as often as I shop on Steam.

  • Arne

    Of course we should not forget the extra sensation of the retail copy: the odor!
    Remember the unpacking video of DKS 🙂 ?

  • Finnishguy

    Great read! You’re moving gracefully through the interview by applying shades of gray and common sense whilst having a highly realistic (and dare I say optimistic) approach to Larian’s situation.

    The piracy question is always an interesting one, and I believe that my generation (the early 80’s kids who were around when PC gaming really took off) are quickly moving from piracy to paying for software now that we are getting into work and earning money. Also, the combination of digital distribution and broadband Internet makes the software available at one’s fingertips. In my mind, piracy can often pay off in the end, but in an industry obsessed with short-term gain and inpatient investors, it is seen as an evil rather than a resource.  Most gamers do not share this corporate mentality, and I therefore believe that Swen’s sensible and realistic thoughts on piracy reflect those of a rather large demographic. The classic concept of “if you can’t beat them, join them” also applies to some extent.

    I also feel very strongly for the choice to go independent, and I wish you all the best. Publishers are going overboard with sequelitis and unnecessarily bothersome DRM. Steam + key should more than suffice.

    • http://www.facebook.com/Dragonseekers Sergei Klimov

      I don’t know if your nickname is suggestive of the territory 😉 but I wanted to comment on how Scandinavia went from PAN Interactive and Vision Park, producing games and having global ambitions, to PAN Vision that is much more conservative and limited in its creative ambitions these days (as it seems).

      The same thing is happening in Russia, with the biggest players in games publishing quickly becoming super-rigid conservatives. No trace of any of the dinosaurs leading the change, or boldly jumping into the new channels, it seems that it takes a developer culture to actually be flexible and adapt.

      Wargaming.net from Minsk is doing fantastically well, generating more profit than all traditional distributors in Russia combined. Nival from Moscow is similarly successful. I believe that Larian is on the same road.

      • Finnishguy

        Thanks for the input! (And sorry about the following wall of text…)

        My name’s suggestive enough 😉 Although I wasn’t too familiar with PAN Vision before looking it up now, I see your point. Especially as the game Backpacker 3 pops up on their front page. I’m not sure if you’re familiar with the Backpacker series, but it’s basically a quiz and geography game – hugely successful in the Scandinavian countries. The first, and even more so the second, were excellent games. But where the first two games were rock solid, the third game was published by Pan Vision in 2003. It seemed rushed, using a bugged and graphically sub-par Macromedia shockwave (or flash?) design, and most likely signified the death of the series all together.

        I talked about short-term my previous post, and short-term goals seem to be the curse (at least from a gamer’s standpoint) of the publishing industry. The required rigid framework which is necessary for quick and safe cash returns, does not lend itself well to creativity and innovation. However, without any innovation and risk-taking, gamers will eventually grow tired, even if the franchise is named Modern Warfare.

        The reason why I am so stoked about Larian going independent, is that we here have a quality developer with what I can only assume is a competent management structure and a clear vision. Quality products DO sell well. I am active on both “pro” and “anti”-piracy gaming fora, and the funny thing is that both demographics buy the games that are actually good. This is especially true when one knows that the money spent is actually ending up in the pockets of those that made the game proper. Another interesting aspect with independent publishing is that good sales could be an incentive for creativity rather than rigidity.

        As a layman, I do not really see the reason for having any costly middlemen when one already has a good reputation and an established fan base, as the distance between provider and consumer has the potential to be very short nowadays – both in terms of sales and marketing.

        • http://www.facebook.com/Dragonseekers Sergei Klimov

          You’re right on the spot with the description of how short-term goals kill the creative business.

          I licensed the first Backpackers from PAN Visiion years ago, for release in Russia, and I could not understand later on ,why they would just drop the whole thing. Would they have managed to keep it going, they would be #1 with the product on iPhone/iPad nowadays, in Scandinavia, as there are precious few local brands and those hat exist, tend to be really good in business.

          Hitting closer to your home ;), I am still puzzled by the lack of Moomintrolls as games, nowadays. Maybe I’m looking in the wrong place, I only found this:

          http://www.publishersweekly.com/pw/by-topic/childrens/childrens-industry-news/article/49520-moomintrolls-move-to-tablets-.html

          – which is great news (as WSOY was also the rights-holder for the Moomin games I’ve published years ago in Russia). Yet still, wouldn’t that be in PAN Vision’s great interest, as a games company, to do the same thing but years before? WSOY is books, PAN is games. Games, as the new media, had to be much more active in their own field, I would presume.

          I don’t know much about the inside stories of the Scandinavian games industry but somehow it managed to go from having games about Karlsson, Pettson, Moomins and the like – to not having it, and whoever you talk to nowadays, are blaming the market / the piracy / the retail. But I’m not sure they are correct. There’s a multi-million industry, a trade association, whatnot, and the result is that Sweden, Finland has no games for kids based on local brands just because the money dried up? Ah well 🙂

          • Finnishguy

            Thanks for taking the time to reply again 🙂

            The local “child brands” tend to not be as strong as they once where, due an increasing degree of syndication of foreign productions like Dora the Explorer. Games made on these licenses would typically mean little for Scandinavian game development other than doing localization.

            The advent of the casual games market on touch screen devices has made gamers out of both young children and (I don’t want to sound sexist, but it’s true) girls. The market demographic that would buy Moomin-games are already “well-fed” on the iDevices, and the competition is staggering.

            The Moomin link you’ve provided is about books, as you say, but it therefore actually illustrates your point well. Interactive e-books is a new, potentially huge market, and the publisher is likely making a clever move by being an early player. If it’s reasonably well made, I can see it being a massive success in Finland, Sweden and Norway. While it will not bring in ridiculous amount of cash, the earnings will be very significant for a local publisher and a local games company. I think this is a great idea, and it shows publisher agility at its finest. And of course, size and agility are often inversely proportionate, meaning that “local” is a key word.

            On another note, I am not sure if I understand the risk assessment strategy that several large game publishers employ nowadays. I am not so sure that alienating one’s original fans in favor of gaining new fans is a less risky strategy in the long term. The Dragon Age series is probably the example that trumps them all, and I cannot see it ever recovering – not in regard to quality, and not in regards to sales. I have the impression that catering to a solid core audience is actually less risky move than trying to appeal to everyone – as there is obvious risk of ending up with only the “trying” part.

            Finally, I have a question regarding Backpacker: Did the games do well in Russia? To me they always seemed like games with a fairly universal appeal.

          • http://www.facebook.com/Dragonseekers Sergei Klimov

            Good morning!

            In the time since my last response, I had a chance to check a young Swedish iOS developer, TocaBoca. They are over at http://www.tocaboca.se and I love what they do as well as how they present it. It also offers the proof to what you’ve written above – TocaBoca can develop their own IPs because it’s HOW not WHAT that matters, and why would they go to Bulls (agency representing Moomins) and give them % of their revenue + share creative control, if they can remain full independent and fully in power?

            Years before, I recall how we used to publish Disney games in Russia. Some games were awesome, like The Lion King, or the old-school Hercules. And some were, umm, too simplistic and more of an exploitation of the license than anything offering creative value (Chronicles of Narnia, anyone?). What happened in the marketplace, though, is that the sales were the same. BRAND = SALES, that was the motto.

            Now, though, people look for opinions / testimonials / FB likes of heir friends, who will not simply recommend something hollow for their children, which changes the market completely.

            On the expansion of the brand’s audience, I agree with you that a logical plan would be to keep the core but also grow at the edges. If there is a brand and a significant number of people who like it, that’s great value already – just frigging keep it there, dear publishers ;). Sometimes expansion doesn’t go well, e.g. Drakensang – I haven’t really seen much success of Radeon/dtp games outside of Germany. But the cases like DA where people watching the trailer and said, no way – this is not for me any longer – are even worse.

            I keep looking at the HoMM license, in the hands of Ubisoft now, and I wonder, why they don’t invite Jon, the creator of the original game, back, to re-launch it properly? He’s still in the industry, working for EA right now. Or maybe EA could buy the brand back off Ubisoft. Because what happens is that after HoMM3, it just goes the other way than the core audience would prefer. And I would imagine that what they’re getting, is – some % of newly lured players each time in plus, and considerable % of core players quitting the series in minus, that’s going to kill the brand for sure. Starve it off.

            Civ 5, over 17 DLC. HoMM6, 0. Or I’m missing something in my Steam store info…

            S.

            PS Backpacker – they came out at the time when Russian games market was not yet ready for such a product; we’ve bought the license and kept it in the fridge hoping for a shift, but lost patience before it happened. The freaky thing was the amount (and the cost) of localization. I would say that at the time of the launch of the original series in Sweden, in Russia PC was not yet in “living room”, it was still “Dad’s plaything”.