The business mind relies on numbers. Numbers are proof, numbers indicate whether something is real, and so numbers help to guide strategy. What people coming into the games business from the outside often do is try to treat it like a normal business. They want to measure trends, take baby steps, and only take chances when they are sure that they are onto something.
In the process they miss the wave. Resonance is not static. It is a waveform, and by the time the business person has settled himself with what the market is, how it works and what it needs to do, the opportunity has often passed by.
Traditional business people operating in artisanal businesses like games are akin to surfers who want to ride the wave but are afraid of drowning. So they sit on the trailing wave, hoping that it has the residual momentum to carry them forward into success. They conceive of no-brainer ideas and comfort themselves with theories about product genres and audience appeal factors instead of taking risks.
Somebody else with a greater appetite for risk takes the opportunity and rides the wave. Zynga raised $29m on the back of a small Poker application and the reputation of its founders, long before there was any real proof to back up their ideas. Lots of other people sat on their laurels waiting for proof. Zynga went on to prove the market to the tune of 200m users, and now all the laurel-sitters want in on the action. They’re way too late.
It is hard for anyone to square themselves against risk, but working at the back of the wave is really not worth it. It’s a very negative mindset from which to operate, and radiates the message that it is not worth trying. Back-wave thinking exists all over the games industry, in every sector, from the wannabe AAA publisher trying to clone its way to success, to the MMO maker with yet another cheap-assed WoW-killer, or the investor trying to convince themselves that lean development is the answer.
The risk in games is to trust in talent rather than numbers. It’s adopting new platforms before they have achieved their potential, building marketing stories that are passionate, and committing before proof. Games are an art, like music and TV, and the uncertainties that come with any kind of art business are in games as well. They are simply how life is.
You can't surf from the back of the wave. All you’re doing is paddling.
If you can't square yourself with that kind of uncertainty then you simply should not work or invest in games. There are plenty of other industries that focus on products and services, and you’d probably have better luck in them. In games, being conservative and slow means you will always be at the back of the wave, always too little too late.
Waiting to prove the market to yourself, unlike the tortoise and the hare, is how you lose. My motivation for writing What Games Are includes explaining them to the business community that often confuses the games industry for the software industry, and so repeatedly makes very bad investments.
Games are a very exciting industry to work in, and the potential rewards are very large, but too few people understand the rules of how entertainment industries work. You really won't get anywhere if you turn up with a spreadsheet in hand, ready to jump on the wave of last year’s trend. It doesn't work in music, movies, fashion or any other creative industry. So stop fooling yourself that it magically will work in games. Many before you have tried and failed.
Learn from that.
Enjoy your blog...
Social gaming is more of a numbers game than any other biz I'm aware of. The art of social gaming is iterating over the metrics. Zynga is the model of the metrics driven approach, split a/b testing, etc.
I don't see Zynga as a risk taker or innovator. They've been relatively unsuccessful when building games based on their own ideas, but they have been very successful remaking other games or improving on ideas they've already tested. I see their success as 1) Getting in on the ground floor. 2) Raising investment dollars in a way no one else has matched. That's their secret sauce -- funding.
The low barrier, in my mind, for putting out a competitive product is what defines social gaming. I think we disagree on this and what affect it has overall. I think you view social gaming more along the lines of traditional companies (ie Google and Search Engines). I would argue that social gaming is its own animal and and because of this, companies like Zynga aren't as entrenched as they seem.
Creating a small budget movie or console game, let alone Avatar or WOW, costs a huge amount of money compared to what is costs to match the most popular social game's content. Very few can compete purely because of the numbers. This matters and affects how entrenched Zynga is and can be.
If social gaming were movies, TV or traditional gaming, companies like Zynga could use more and more money for better and better content, as a defense against competition, but it can't. Social gaming isn't like these other entertainment industries. Social gamers don't seek the kind of content that money would help with. To reach the masses, the games must be simple and to be simple means there's no deep tech stack. The social gaming crowd, particularly the best converting segment made up of middle aged women, won't stomach complex games.
Again, enjoy reading your stuff!
Posted by: Krister | 05 January 2011 at 05:57 PM
That's a great comment Krister, thanks.
Posted by: Tadhg | 06 January 2011 at 01:46 AM