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Is there a sweet spot?

Depends on who or what you touch

The gaming industry, in particular the PC gaming business, is in turmoil. The consolidation of players, and the demise of developers and studios, is fair testament to that.

On the hardware side you’ve got ATI and Nvidia spending billions of dollars on R&D to develop newer and better, and bigger, GPUs that seem to be one or two generations ahead of the game developers, putting the GPU makers’ investment at risk.

Then there’s the CPU suppliers trying to increase PC volume through price elasticity, convinced that if they can get the price to zero there will a lot more customers for them. They see the volumes of mobile phones and reason that everyone who has a mobile phone should also have a PC and it’s only the price that’s preventing it, failing in their silly greed to understand that many of today’s mobile phones cost more than a PC to make and they are not being sold but given away.

The enthusiast market has stayed at about the same level for the last six or seven years. Three or four years ago the GPU builders were convinced that they would be able to attract what was then called the casual gamer into the semi-enthusiast space by having great titles, cinematic effects, and, yeah, better prices. That never happened, and I’m betting it never will. That’s like the Corvette and Ferrari people saying, If we could just get those SUV drivers to move up.… Casual game players and SUV drivers are playing those games at their frequency, and driving those chrome-plated trucks for a reason—it fits their life style and they aren’t going to change. There is no pent-up demand for high-powered FPSs and Ferraris. There may be idle talk over beers, “Man, if I just had me a Ferrari,” or, “Yeah, I’m be getting me a Corvette, dude.” And they high-five each other and then get into their SUVs, and having a beer or two, drive home thinking they’re in a Corvette—all things considered, I’d feel a lot safer if they were home playing computer games.

As for the price elasticity of PCs, Epic Games’s outspoken vice president Mark Rein has some strong opinions on that and at a recent conference said the PC games market is being killed off thanks to low-priced low-spec machines that are incapable of playing the latest cutting-edge games—“If Intel left the PC graphics market we’d all be better off.”

It would seem that somewhere in-between the fixed 2 to 3 million enthusiasts and the SUV drivers, there should be a sweet spot. A PC and AIB that can run a first-line FPS title pretty well, maybe not with all the bells and whistles turned on, but enough to make it fun. And no doubt we could, with little effort, configure such a system for under $800 (not counting the display) that would fit the bill. In fact I know we could. So why is the PC game market in the doldrums? It can’t be due to hardware costs as Rein would have us believe.

Well, maybe it’s not Intel’s fault, and maybe ATI and Nvidia aren’t two generations ahead, and maybe there even is some pent-up demand for first-line games if, … if we could get some a little more often than every other year!

Think what would happen to the movie business if they only released one blockbuster film every other year—and you never know what time of year that would be. Sure, you say, but there are a lot more movie studios than there are game studios. Well, whose fault is that? If the game studios could learn how to run a business and quit hiding behind the adolescent excuse of creativity and we’ll ship it when it’s right, then there might be a few more game studios around.

AMD, ATI, Intel, Nvidia, Disney, Pixar, Dreamworks, Sony, Buena Vista, etc., deliver a new product every six months, to a schedule, with a budget from as little as $10 million to as much as $200 million—per product! And they do it year after year. And they don’t whine about the crappy market they’re in, or how mean everyone else is to them; they just deliver. You know why? Because they are running a business, not a junior college art class.

There is, from my POV, nothing different from a game studio, a play production, a movie studio, or a music studio, in terms of complexity of content delivery and developmental costs (music is probably a lot less expensive but not a four-star opera, and think about road shows.)

So who killed the game industry? The game developers, or I should say the game non-developers. You want a robust market, then put up or shut up. Give us some titles, and sequels don’t count.

With a perspective, I’m .

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