Understanding New Media (chapter 11) by Eugenia Siapera. The new gaming market.

What first struck me when reading this chapter, is the seemingly old-fashioned view miss Siapera provided of the computer games market. She proposes a view in which distributors have developers in a stranglehold, where funds always come from big multimedia corporations and creativity can be sacrificed for larger profits. To paraphrase one remark on page 214: "Small independent companies are unlikely to survive in a massively competitive media environment". This might have been true about 5 years ago, but things are changing for the better nowadays. In this post I would like to discuss the 3 driving factors that are liberating the independent development houses.

Funding

Kickstarter logo for funded games

Yes; there is no work without pay. This is equally true for the gaming market. Most of the larger titles in gaming require quite the investment. To even get started in the first place, there are costs like licensing for software used (e.g. 3d modelling tools) and  freelance costs for concept artists and writers. Then there's the costs for developing high quality sound, art, environments, characters, animation, scripting, coding and algorithms involved. In bygone days, developers with big ideas were forced to crawl to publishers on their knees in hopes of receiving funding.

Crowd funding initiatives like Kickstarter have revolutionized the way in which developers of all sizes can obtain the required funding. Kickstarter gives developers a page on which they can present their work so far, and ask for donations from interested users. This allows independent developers to avoid the judgement and involvement of big publishers in their creative process.This week alone, another two big budget games have passed their required budget goals. Dreamfall: Chapters ($1.540.000 out of required $850.000) and Torment: Tides of Numeria ($2.350.000 out of required $900.000) have been cleared for liftoff.

http://www.kickstarter.com/projects/redthread/dreamfall-chapters-the-longest-journey

http://www.kickstarter.com/projects/inxile/torment-tides-of-numenera

Distribution

So creating a product is one thing, but getting it out there to your customers is another. Siapera seems to assume that the traditional bricks and mortar store or ordering it to your home is still the only way. Digital distribution services like Valve's 'Steam' have grown rapidly in recent years, and the latest estimates show that digital distribution now accounts for roughly 25% of the total games market (NPD Group annual report).

Minecraft in action

Digital distribution means that you won't be getting a nice box in your hands with a disk in there. Like all modern media, the data of a game can be transported purely in the form of bits and bytes, with no need for a physical carrier. This also means that there is no need to ship your product into stores and warehouses across the world. Global digital distributors like Steam have reduced the entire distribution process to one simple upload on a server. This means that independent developers now have a chance to get their games to customers without having to rely on the established networks of publishers. Similarly, the Swedish independently developed Minecraft has sold 9.650.000 copies, purely through digital distribution.

Marketing

According to Siapera, Kline (2008) claims high intensity marketing to be one of the critical success factors for games. This is still true, but the marketing game has also undergone some significant changes in recent years. It is true that a small budget won't buy you television adds and billboards  but there are many free marketing alternatives out there thanks to social networks.
In addition to word of mouth becoming a force to be reckoned with on Facebook, YouTube is also an essential marketing tool to be reckoned with. Lets play series (in which YouTubers record themselves playing games) have become an invaluable source of free marketing. Not only in terms of quantity, but also quality. Famous examples are:
BlueXephos (1.7 billion views) playing the independently developed game Minecraft.
RoosterTeeth (1.85 billion views) playing a variety of independently developed games.
Pewdiepie (1.2 billion views) playing the independently developed games Happy Wheels and Amnesia.

In conclusion, the gaming market is moving more to a dynamic, customer-oriented market, where big publishers no longer define the inner workings. This shows great promise and opportunity for the future, for an entertainment form that I hold very dear.