Hit Points
Independent games industry analysis and commentary by Nathan Brown (ex-Edge).
Documents
Desperate Measures
The gaming industry is currently witnessing a period of extreme, performative posturing as the proposed acquisition of Activision Blizzard by Microsoft nears its regulatory conclusion.
- Sony and Microsoft have submitted final responses to the UK's Competition and Markets Authority regarding the Activision Blizzard acquisition, with Sony arguing that Microsoft could intentionally introduce bugs or performance degradation into PlayStation versions of Call of Duty.
- Microsoft is utilizing full-page newspaper advertisements to promote its claim that bringing Call of Duty to Nintendo and Nvidia platforms will reach 150 million new players, a figure derived from the 125 million existing Switch units and 25 million GeForce Now subscribers.
- Warner Bros. is delaying the release of Rocksteady’s Suicide Squad game from May to later this year following negative fan reception to its gameplay reveal.
Round the Campfire
Microsoft’s ongoing efforts to secure regulatory approval for its acquisition of Activision Blizzard are characterized by a strategic public relations campaign and a series of high-profile concessions.
- Microsoft has signed a ten-year deal to bring Xbox PC games to Nvidia’s GeForce Now cloud-streaming service, securing Nvidia’s support for the Activision Blizzard acquisition.
- Microsoft previously entered a ten-year agreement to bring Call of Duty to Nintendo platforms, a move intended to alleviate regulatory concerns regarding market foreclosure.
- The Activision Blizzard acquisition remains under intense regulatory scrutiny, with Microsoft attempting to frame the deal as a benefit to the broader industry while isolating Sony as a market-dominant competitor.
Bargain Hunt
The gaming industry faces a growing tension between consumer demand for discounted titles and the economic necessity of regional pricing.
- Thunder Lotus significantly increased the price of 'Spiritfarer' in Turkey and Argentina—by over fivefold and sixfold respectively—to combat 'region hopping' by bargain hunters using VPNs.
- Approximately 85% of 'Spiritfarer' sales attributed to Turkey and Argentina were identified as coming from users located in other countries attempting to exploit lower regional pricing.
- Platform holders have the technical capability to block VPN-based regional price exploitation but lack the financial incentive to do so, as they prioritize total sales volume over regional price integrity.
Death in Service
The recent wave of live-service game closures highlights a systemic failure in the gaming industry’s pursuit of perpetual revenue models.
- A wave of high-profile live-service game closures occurred in early 2023, including Rumbleverse, Knockout City, Apex Legends Mobile, Battlefield Mobile, CrossfireX, and Echo VR.
- The console and PC sectors lack the 'soft launch' efficiency of the mobile industry, where developers test titles in select territories and kill underperforming projects before global release.
- Supercell’s development model demonstrates the high failure rate of live-service titles, with the company’s cancelled projects outnumbering its actual releases by a ratio of nearly four to one.
No Show: E3 2023
The decision by major platform holders—Microsoft, Sony, and Nintendo—to skip the 2023 E3 convention represents a significant challenge for the event’s revival, yet it does not signal the industry's total abandonment of the trade show format.
- Microsoft, Sony, and Nintendo have all confirmed they will not participate in the E3 2023 convention in Los Angeles.
- The absence of major platform holders is attributed to strained relationships with the ESA and a broader industry shift away from traditional in-person trade shows.
- Sony has reportedly halved its production forecast for the PlayStation VR2 headset due to weak pre-order demand.
Behind the Mask
The January 2023 analysis critiques Microsoft’s decision to lay off 10,000 employees while simultaneously pursuing a $68.7 billion acquisition of Activision Blizzard.
- Microsoft announced the layoff of 10,000 employees, representing nearly 5% of its global workforce, while simultaneously pursuing a $68.7 billion acquisition of Activision Blizzard.
- Despite recent economic concerns, Microsoft reported $17.6 billion in profit on $50.1 billion in revenue for the quarter ending September 30, 2022, and held nearly $23 billion in cash.
- The $68.7 billion earmarked for the Activision Blizzard acquisition could theoretically fund the salaries of the 10,000 laid-off employees for over 41 years, based on a median salary of $162,818.
The New Style
The provided text serves as a stylistic manifesto for video game journalism, advocating for a more precise and responsible use of language within the industry.
- The term 'accessibility' should be reserved for features supporting players with disabilities, rather than being used to describe a game's ease of entry or tutorial quality.
- Industry discourse should distinguish between 'machine learning' and 'artificial intelligence' to avoid adopting corporate terminology that obscures the human-based nature of generative content and potential labor implications.
- Game journalism should move away from reductive genre labels like 'walking simulator,' which often serve as unhelpful and unflattering shorthand for new or experimental game experiences.
Share Button
Microsoft’s pledge to bring the Call of Duty franchise to Nintendo platforms for a ten-year period serves as a strategic public relations maneuver rather than a substantive shift in market dynamics.
- Microsoft's offer to bring Call of Duty to Nintendo and Steam is a strategic PR move designed to appease regulators regarding the Activision Blizzard acquisition, despite the negligible business impact of a Nintendo port.
- Microsoft is increasing the price of its first-party games from $60 to $70 starting in 2023, aligning with industry-wide pricing trends.
- Zenimax Studios' QA staff have announced their intent to unionize with the Communications Workers of America (CWA), with Microsoft stating it will not interfere, partly to maintain favor during the Activision Blizzard merger process.
Silence Kid
Modern triple-A game design increasingly prioritizes constant narrative engagement, often at the expense of player-controlled pacing and quiet reflection.
- Modern triple-A game design increasingly utilizes dynamic dialogue systems that fill quiet moments with narrative, effectively eliminating player downtime to ensure constant engagement.
- Embracer Group reported a 190% increase in sales during Q2, alongside 35% organic growth, while simultaneously warning investors that macroeconomic conditions may force the spin-off of subsidiaries.
- The UK’s Competition and Markets Authority has launched an investigation into cloud gaming services and mobile browser restrictions on Apple and Google app stores.
Gaming the System
The practice of publishers selectively withholding review code to manipulate day-one Metascores is a recurring, counterproductive strategy within the video game industry.
- Publishers frequently withhold early review code from critical outlets to protect day-one Metascores, a practice that risks alienating journalists and creating a negative perception among players.
- Selective distribution of review code often backfires by making critics more suspicious and alert to a game's flaws, potentially resulting in harsher reviews than if the game had been released to all outlets simultaneously.
- The European Commission has launched a phase-two investigation into Microsoft’s proposed acquisition of Activision Blizzard, with findings expected on March 23, 2023.
Pass Notes
The gaming industry is currently witnessing a critical inflection point for Microsoft’s Game Pass subscription service.
- Xbox Game Pass generated $2.9 billion in revenue in 2021, but growth has slowed, with the service missing its internal 73% growth target for the 12 months ending June 2022 by posting only 28% growth.
- Phil Spencer stated that Game Pass is expected to remain at approximately 15% of Microsoft’s total gaming revenue, suggesting the company does not view subscriptions as a path to majority revenue dominance.
- Microsoft’s gaming division reported a 3% decline in revenue from games and services for the second consecutive quarter, attributed to a lack of both first-party and third-party content.
Legless
The current state of the metaverse, particularly Meta’s Horizon Worlds, is characterized as a failing enterprise that risks damaging the broader reputation and future of virtual reality technology.
- Meta’s Horizon Worlds is facing internal pressure to increase employee usage, with leadership demanding staff spend more time in the platform to address low engagement levels.
- Meta announced the upcoming addition of legs to avatars in Horizon Worlds, a feature that relies on inferred positioning rather than actual tracking of user limbs.
- Decentraland, a prominent web3 metaverse platform, reported low daily active user counts, with data suggesting figures as low as 38, though the company disputes this, claiming over 8,000 daily users.