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FEATURED VOXPOP oblivion437
Wish List for Fallout 4
By oblivion437
Posted on 11/24/14
So I promised that list and here it is.  It's late and it's not as thorough as I'd hoped.  I also wish I had images handy to illustrate every point where helpful.  So, in no particular order - a subjective set of desired features for Fallout 4: Things to...

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Publishers to Nintendo: "Wii don't need U."
Posted on Friday, May 23 2014 @ 07:12:04 Eastern

This member blog post was promoted to the GameRevolution homepage.
The Wii U does not play nicely with third-party publishers. Its computing power is insufficient to support straight ports from other eighth generation consoles. The GamePad’s inset screen demands special design considerations. Sparse documentation and clunky tools plague Wii U development efforts with additional financial risk.

For Nintendo, such contrarian design decisions are familiar territory—the literal kin to cartridges and mini-discs in ages of CDs and DVDs or a motion-based game controller shaped like a TV remote. Some, with Nintendo likely counted among their number, would argue that the bucking of convention is an idiosyncratic hallmark of the company that forces innovation and drives success. Some publishers, trying to build businesses around said idiosyncratic hallmark, would likely reply that it’s a huge pain in the ass.

Now, with the anemic two-year sales of the Wii U, the largest of those publishers are handing Nintendo a knapsack containing all of its bullshit and kicking it out the door.

How do I know? Because the publishers told me, as did Nintendo itself, all via their public annual and quarterly reports, from which all the following data is taken. As a reference point for most of the graphs that follow, the Wii was launched in 2006 and the Wii U was launched in 2012.

Let’s start with Ubisoft, the most Nintendo-friendly of the Big Three:


Ubisoft threw considerable support behind the Wii U, developing launch title ZombiU exclusively for the platform. The result was Nintendo's console revenue share crumpling from first to worst, halving in percentage contribution, and declining year over year. Over 75% of remaining Nintendo revenue at Ubisoft is generated by Wii software.


If Nintendo fell to its early Wii days at Ubisoft, it plummeted below the GameCube ages at Activision Blizzard. With the Wii U and Wii making up only 9% of Activision’s console business after a 25% YoY decline, those delayed Wii U version announcements for certain flagship IPs start to look a tad less like oversights. At least Nintendo will get Skylanders.


Electronic Arts has abandoned Nintendo with an unprecedented dearth of software support. There are no major upcoming Wii U games. There are no major upcoming Wii U ports. ‘Wii U’ does not appear as a dropdown option on EA’s website. While EA might still accept the odd Wii U publishing engagement, it has specifically excluded Nintendo consoles from any present and future owned IP offerings.

But wait, it gets worse.



The GameCube era is often brought up as an analogue to Nintendo’s current plight: If Nintendo survived that boat anchor of a console, why can’t it demonstrate equal resilience through the Wii U era?

One major difference is that the handheld market is no longer a place where AAA publishing houses play. In addition to a bonus glimpse at the revitalization of the PC gaming market and the rise of mobile, the charts above show that handheld revenues in 2013 are effectively nonexistent. The point is not that all of Nintendo’s various dimensions of DS are going to tank, as AAA publishers are likely not representative of the majority handheld volume. Rather, no handheld relationship with Nintendo means that Ubisoft and EA have no reason to make concessions to prop up the Wii U in exchange for favorable handheld terms. Did that happen during the GameCube era? No idea. But it absolutely cannot happen now.

In EA’s case, no handheld revenue means that the entire company has a nearly zero Nintendo game footprint. Activision Blizzard could not be charted because its handheld sales were so small that it chose to roll them up under the category ‘Mobile and Other’.

“But so what?” say the Wii-fenders. “Nintendo makes all of its money off of first-party titles and… Japan? It has never needed tons of third-party support.”

If the Wii U were on the same trajectory as GameCube, I might be inclined to agree with this statement. Let’s take a look at the performance of Nintendo’s latest console against its priors.



In Nintendo’s 64-bit-plus history, the Wii U had the worst hardware launch, the worst second year sales, and the worst YoY trend. Current Wii U hardware volume is running a whopping 35% behind the GameCube over the same timeframe. Exacerbating Nintendo’s woes is a lowest-ever cumulative tie ratio, meaning that less software is being bought per console sold than ever before.

So with fewer consoles AND a lower tie ratio, either the hardcore fans are abandoning Nintendo more aggressively than previous casual adopters, or there are simply fewer games overall. While I can’t speak to the first point, Nintendo has provided clear data on the second.



Straight off a cliff.

The Wii U is caught in a death spiral. It lacks the user base to entice third-party publishers, and it lacks the third-party publisher support to expand its user base beyond core Nintendo loyalists. With $3.3 billion in the bank, Nintendo will avoid making the Wii U its Dreamcast—but just 3 years ago, the company’s coffers held over double the current amount. If Nintendo wants to continue with its esoteric ways, its next offering needs to be either prescient, lucky, or focused enough to survive on first-party bread alone. Third-party publishers have had enough.

The opinions expressed here do not necessarily reflect the views of GameRevolution, but we believe it's worthy of being featured on our site. This article, posted earlier in May 10, has been lightly edited for grammar and image inclusion. You can find more Vox Pop articles here. ~Ed. Nick Tan

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Kickstarter: The Cheapest Money a Company Can Raise
Posted on Friday, April 4 2014 @ 11:29:31 Eastern

This member blog post was promoted to the GameRevolution homepage.
There is a fair bit of anger over the $2 billion acquisition of Oculus by Facebook. A large amount of that anger is misplaced in the idea that Oculus is performing an about-face and betraying core gamers by selling out to a social company. This is silly: Oculus CEO and co-founder (think Sean Napster in The Social Network) Brendan Iribe was trying to distance his product from “just a fun alternative game console” as early as a December 2013 interview with Techcrunch.

Kickstarter backers, on the other hand, saw the potential of Oculus's product almost before there was a product to see. Months ahead of the very first venture capitalist and over a year before Marc Andreessen's vaunted technology investment firm caught wind, crowdfunders saw the potential in Palmer Luckey's innovations and put up $2.4 million to support his dream. Now, after the $2 billion validation of their intuition and savvy, Kickstarter backers are left holding a pair of prototype goggles that were outdated before they shipped while the 'real' investors race their yachts into the sunset.

Legally, Kickstarter backers have no leg to stand on—but do they lack even a conceptual kick-stand on which to prop themselves up? How much would the $2.4 million Oculus raised from Kickstarter be worth if it had come instead from an early investor?

Let's build the world's simplest model:
  [Click to embiggen. ~Ed]
As a regular equity investment, the $2.4 million Kickstarter donation would be worth $281 million dollars today, or a one-hundred sixteen (117 – 1) times return on investment over two years. Put another way, the average Kickstarter participant who pledged $300 was actually donating a potential $35,100 in 2014 dollars. Minecraft creator Markus Persson's $10,000 donation would be worth $11.7 million.

We can also look at this from the perspective of Oculus’s founders. Had they gone the traditional start-up funding route of angel investors and seed funds, $2.4 million in capital would have cost them $281 million of their current ownership of the company. And what did that capital ‘cost’ when it was raised through Kickstarter?

Nothing.

It’s well understood (and if not here you go) that because Kickstarter treats all funds submitted as a donation, backers have no claim to any equity ownership of the company or product they back. In fact, Kickstarter backers barely even have a claim to the rewards at the tier they pledge at (as if to prove this point, Oculus was late on backer reward fulfillment with absolutely no penalty imposed upon them).

What was NOT considered until the sale of Oculus was the true value of the capital being donated. Nearly every Kickstarter project positions itself as a single transaction proposition: Backers pre-pay for a product, the company delivers the product, and both parties walk away in a state very similar to the one they began in. Sure, some noted that Double Fine had a completed video game that they could sell to everyone who DIDN’T back the project and reap 100% of those profits, but until Oculus there wasn’t a clear, well-publicized example of an entire company being built on the back of donations that at first blush appeared to be simple manufacturing costs. R&D, headcount, marketing--all of the vital functions for large-scale startup growth were funded at no equity cost to the owners.

Every product-based company with early-stage capital needs should be on Kickstarter. There is no more cost-efficient way to raise capital, and no other alternative for non-millionaire funders . Equity crowdfunding, in which a backer receives ownership in a company rather than in a product (or the non-contractual promise of a product, as in Kickstarter’s case), is slowly being written into law and regulation. For now, the only way early Rift adopters will see any of their $281 million contribution to Oculus's founders is to put on their pair of outdated, prototype goggles.

The opinions expressed here do not necessarily reflect the views of Game Revolution, but we believe it's worthy of being featured on our site. This article, posted originally on February 5, 2014, has been lightly edited for grammar and image inclusion. You can find more Vox Pop articles here. ~Ed. Daniel Bischoff

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Steam Holiday Sale generated over $340M in game sales--it’s a SWAG, baby!
Posted on Wednesday, February 5 2014 @ 02:15:39 Eastern

This member blog post was promoted to the GameRevolution homepage.
What was PC gaming worth in 2013? It depends on who you ask.

Ask DFC Intelligence, and they’ll estimate the 2013 PC gaming market at $21.4 billion. Ask Gartner, and you’ll be shaving a whopping $4 billion from that initial estimate—they peg 2013 PC gaming at $17.7 billion, crossing the $20 billion mark in 2014 and finally reaching parity with DFC’s 2013 estimate with a 2015 target of $21.6 billion.

The PC Gaming Alliance thinks Gartner is full of ****. According to their research, PC gaming already broke $20 billion back in 2012, when it made up 38% of the gaming market. Gartner has PC gaming at $14.4 billion during the same timeframe with only half the market share.

So how can these research firms, with all of their proprietary information and rock-solid sales figures, be so far apart on historical estimates of the same market? Simple—they’re SWAGing.


A SWAG is a Scientific Wild-Ass Guess--a combination of rough partial data, approximated calculations, and general historical experience. Exact definitions vary, but a SWAG can generally be differentiated from a forecast or a financial report by the amount of assumptions and rules of thumb that are applied to patch up holes in the available data. Almost all proprietary third-party estimates are, at least in part, SWAGs.

Now, there’s nothing inherently wrong with a SWAG; a good one will get you within an order of magnitude of the truth and will be used for business decisions like market entry. The problem arises when firm XYZ spits out a number with three trailing decimal places and zero error, and then that amorphous specter, ‘the press’, picks it up as THE number without questioning methodology or motivation. The PC Gaming Alliance commissioned a gaming study and found out that all evidence pointed towards PC Gaming as the single most dominant market force? Gee.

When Gabe Newell says that Steam has over 75 million active users, that’s a fact—he’s got one hundred percent of the data, and even then we could still argue over the definition of ‘active user’. But when IHS Screen Digest says Valve made $1.1 billion in revenue during 2012? They can call it “a deep understanding of market dynamics and technological developments [with] support from the most comprehensive, accurate and detailed database of global media and technology statistics available anywhere in the world”, but, at the heart of it… they’re SWAGing.

So, to understand just how much uncertainty can sit behind a seemingly solid number, let’s go through a simple SWAG together by estimating the total size of the 2013 Steam Winter Sale.

The 2013 Steam Winter Sale ran from December 19th to January 3rd and featured over 150 games deeply discounted, sometimes up to 80% off. For the first time, Valve also introduced a system to craft in-game items by participating in the sale and published the total count of items created. This public data will be the cornerstone of our SWAG.

As of about one hour prior to the close of the sale, 1,681,565 items had been crafted by Steam users. These items were crafted by creating Snow Globe badges, which were created by combining Snow Globe trading cards, which were earned for every $10 spent during the sale (see where this is going?). To make things even more complicated, there were both normal and foil trading cards whose badges created different amount of items, and there were trading cards that were created--but not combined into badges--hosted for sale on the Community Market.

So, first problem: How many total trading cards are there?


16,632,476 trading cards. If we felt like being simple, we could multiply by $10 and come to a sum of around $166 million dollars, which is, like, damn. But Valve, benevolent benefactor that it is, added multiple ways for a user to have created a trading card:


Somehow, we need to sample the population of Steam users and figure out how frequently members both crafted non-Snow Globe badges during the valid period and voted in the Community Choice sales.

A few fun facts about Steam: Steam Community can be accessed from a web browser, which means public user data can be web scraped. The majority of user profiles are public There is an official Steam Holiday Sale group with over one million members that we can sample from. So, all we need to do is program a web scraper in Python, grab a random sample of 100,000 profiles from the Steam Holiday Sale group, attempt to scrape user profile data from each of them, and then aggregate the results. We can then generalize the data across the entire Steam population by weighting up by the number of Snow Globe badges earned.


So with all our assumptions laid out, we have 16,632,476 total trading cards, 3,014,667 of which came from badge crafting and 5,551,586 of which came from voting for the community choice sales. This leaves us with a grand total of 8,066,223 cards coming from game purchases, for a total of $80,662,228 spent.

But… If we ‘1 to 43’ the 75,000 users we scraped all that data from, we end up with just shy of 3.2 million users. Just after the 2013 Holiday Sale ended, Gabe Newell announced that Steam had broken 75 million users. If we’re attributing $80 million in sales to just 3.2 million users, how do we account for the behavior of the other 71.8 million?

One way would be to true-up with straight line multiplication, making Valve’s 16 day sale worth approximately $80 * 75 / 3.2 = ~$1.9 billion dollars. That estimate seems… ambitious.

Here’s where we can apply some industry experience. In most mass consumer businesses, customer contribution follows a negative exponential function, meaning that the ‘best’ customers contribute a disproportionately large amount of value relative to the majority. The general form of a negative exponential function is as follows:



Don’t believe that happens in real life? Take a look at the game ownership data we scraped from those 75,000 Steam users:


$340 million. Woo! Done! Or not.

Now, we have to digest all the gristle we ground into that sausage of a number. Think of this as a sanity check: What does $340 million actually imply?


So, what do you think—is $340 million a reasonable revenue number to attribute to the 2013 Steam Winter Sale period? Even when the entire analysis hinges on a single public statistic, 76.3% of the revenue is based on one assumption, and the methodology we used would produce a lower estimate if we scraped a larger user population? How far off are we? One million dollars? Ten million? One hundred?

In fairness to professional analysts, most published estimates aren’t quite so haphazard. Sizing a market generally starts with a summation of all available public revenue, which grounds the final number in more or less reality, depending on the industry. For example, Sony, Microsoft, and Nintendo are all public companies, so sizing the total value of the console market for hardware producers should be relatively consistent outside of future growth assumptions.

Even for our analysis of Steam, there were more accurate methods we could have used to estimate total Winter Sale revenue—imagine if we had scraped all the games owned by our 100k users at the very start of the sale, scraped the same users again at the end, and then looked at what new games those users had gained multiplied out by the sale prices and total active users. We’d probably get a bit closer to the truth. Maybe.

But at the end of the day, we’d still be SWAGing.

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Game Length and Completion Rate: Is Shorter Really Sweeter?
Posted on Tuesday, October 15 2013 @ 09:35:48 Eastern

It is a statement that carries the inevitability of climate change in Winterfell: “Games are getting shorter.” Despite a startling lack of popular data-driven analysis on the topic, you would be hard-pressed to find a gamer that disagrees...   read more...

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​The Great Price Guarantee
Posted on Wednesday, September 18 2013 @ 13:32:00 Eastern

Recently, Origin introduced the Great Game Guarantee, allowing any EA-published game to be returned for a full refund within the shorter of 7 days after purchase or 24 hours after playing. In their press release, EA suggested two reasons that one mig...   read more...

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The Public Financial Rise and Fall of THQ
Posted on Sunday, November 25 2012 @ 01:14:41 Eastern

After THQ dined and dashed out of its most recent earnings call and then defaulted (technically) on its credit facility with Wells Fargo, I became interested in the strategies and leadership that plummeted the former multi-billion dollar company down...   read more...

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Black Mesa is the Best Remake of Anything, Ever (and You Will Love It)
Posted on Friday, October 19 2012 @ 14:26:46 Eastern

Black Mesa, the Source remake of the original Half-Life, has been out for just under a month at the time of this writing. This game (and it is that: a full, triple-A, capital ‘G’ Game) is everything a remake should be: It captures the sou...   read more...

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Did Game Revolution Kill The Secret World?
Posted on Saturday, July 14 2012 @ 02:13:36 Eastern

If you aren’t familiar with The Secret Worldcom scandal, the story unfolds as follows: Game Revolution reviewer Jonathan_Leack, in a manner that can only be described as “horribly underprepared for the consequences,” posts a review ...   read more...

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The Death of 'Teen'
Posted on Friday, February 3 2012 @ 08:48:29 Eastern

One brisk August day in 1992, a former amusement park manufacturer turned game publisher rolled a brand new cabinet into video arcades across America. It was a two-player black upright, bound with bright red bordering and sporting a generic combat gr...   read more...

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One Score to Rule Them All
Posted on Friday, December 9 2011 @ 11:53:32 Eastern

Sit down and grab some popcorn: this is a long one.

(Thanks to Bras for the article suggestion.)
 
Have I ever told you the story of Metacritic? Let me tell you the story of Metacritic.
 
Once upon...   read more...

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