- By Region
While the giant screens showing forthcoming blockbusters from video game publishers and console makers still dominated this week’s E3 trade show, it was their response to the challenge from much smaller screens that was more striking.
Consumers are increasingly seduced by the experiences that growing social, mobile and cloud gaming companies – camped out on the show floor’s periphery – offer to users on smartphones, tablets and smart TVs.
But Microsoft, Sony and other old guard companies hit back during their annual event with technology that enables users to move between devices, while anchoring them in their traditional console business.
By tying these devices together, console makers and video game publishers are aiming to expand market share in a multi-screen world that is ten times larger than that of just consoles, giving 2bn rather than 200m consumers access to gaming.
“We are all familiar now with people watching television while doing other things with laptops, tablets and smartphones and those experiences not necessarily conflicting with one another,” says Andrew House, president of Sony’s PlayStation business.
Sony’s response to the proliferation of small-screen usage includes “cross-platform” technology that linked its PS3 home console with its PS Vita handheld one, allowing games to be played between a PS3 user and a Vita user. It also has the ability to “cross-save” – or manage saved data – so that a game played on the PS3 can then be continued on the Vita, and has a “cross-controller” – which uses the Vita’s touch screen, cameras and rear touch pad as a controller for the PS3.
“We can carve out a distinct experience between the Vita and PS3 that can provide a more intimate link than what is being offered elsewhere,” Mr House says.
Microsoft unveiled its Xbox SmartGlass, a bundle of technologies that combines the power of its Xbox Live online service with new wireless capabilities. This enables any tablet or smartphone to be used as a wireless remote control for the Xbox, and content can be paused and resumed on different screens.
Nintendo, for its part, gave more details on the Wii U console and its concept of “asymmetric gaming”. Its Gamepad controller with an embedded touchscreen gives the player a different view of games than others using regular Wii controllers and the company showed more than a dozen titles this week that took advantage of this idea. “It can actually change the face of the gaming world,” says Satoru Iwata, Nintendo chief executive.
Games publishers are well advanced in their efforts to earn digital revenues, with monthly subscriptions and downloads that extend the life and scope of battlefields in their games, such as the Call of Duty series, while sales of virtual goods are becoming increasingly important.
“There are so many more ways to monetise user engagement today than ever before and that’s a very dynamic part of our business, ” says Bobby Kotick, chief executive of Activision Blizzard, a US-based games company. “But you really need to offer a lot of flexibility to your audience to ensure they’re comfortable in what they’re investing in, whether it’s subscriptions or downloadable content or value-added services or virtual item sales.”
New Asian competitors, such as Gree of Japan, had a big presence at E3, underlining the fresh challenges to US publishers. Gree has learnt lessons from the mature mobile gaming market in its domestic market, such as using weekly competitions to maintain the interest of gamers.
“In game design and monetisation, Gree is two years ahead [of US rivals],” claims the Japanese company’s US chief executive Naoki Aoyagi.
At an E3 analyst briefing on Wednesday, Electronic Arts unveiled details of a digital platform it has been building to deliver its games to consumers across all types of devices. It took the unusual step for a publisher selling games as “packaged goods” of appointing a chief technology office, Rajat Taneja, last year to handle the project.
Mr Taneja, who previously built digital platforms for Microsoft, says there has to be more robust and simpler offerings than in the past, such as giving a user a single identity across games, flexible payment options, the ability to have game data saved in the cloud and 99.99 per cent network reliability, with good security and high performance.
“What was acceptable in the past – that you will have downtime, that you will have to enter your credentials more than once and have multiple logins, that when your phone battery dies you will lose what you have achieved in a game – those things are no longer going to be acceptable,” he says.
“In this larger consumer market, where monetisation models and game experiences are so different, the bar for EA and our industry is much higher now.”