Data Filter: The News You Need in Easy-to-Swallow Gel Cap Form

Electronic Gaming Business, June 30, 2004

News-o-Matic

Whassup?: A global TV spot for the Sony Playstation2 brand won the Grand Prix first place awards as ad of the year at the 51st International Advertising Festival at Cannes, France. "Mountain," produced by TBWA, London, depicted hordes of people piling on to form a skyscraper-high mountain of bodies atop which new kings of the hill emerge and retreat. Seamlessly blending scenes shot in Brazil with hyper-real digital effects, the pile reaches higher than a cuty tower. Meanwhile, Shirley Temple croons the gospel tune "Get on Board, Lil' Children" from 1933 until the tagline, "Fun, Anyone?" ends the spot. The commercial used 500 extras and 300 crew. "It's really a landmark in advertising," said the award jury president, Plyush Pandey, while others admired its epic vision of global cooperation and the importance of play. And So?: As a rule, the curmudgeons around here don't get awestruck too often, but TBWA's spot will almost certainly stand as this generation's version of the CocaCola "I'd like to teach the world to sing" spot. It not only captures the grungy, boisterous idealism and good will of contemporary youth but it actually suggests important global themes for this industry. Mimicking the meteoric rise of gaming itself, these hordes rush to create a King of the Hill game that is messy, inexplicable, a tad violent, emotionally cathartic and also oddly social and shared, at once competitive and cooperative. The brilliant, reflexive thing about this ad is that it seems to be pressing us to understand what we are doing when we play these games and why it has become the defining medium for this generation. Not bad for a 30-second ad. Run, don't walk, to see it via a link at AdAge.com (www.adage.com/news.cms?newsId=40914)

Whassup?: EA Sports gets in the game... the fantasy sports game that is, by rolling out its EA Sports Fantasy Football product on July 21 at www.easports.com/fantasy. For $99.99, users can play Commissioner to score and create rules for 32 team owner friends or for $9.99 they can play head to head against other teams in the Public League. EA is offering personalized home pages and real time sport info updates to fuel the leagues. It also claims to offer managers reams of exclusive data on which to make draft and strategy choices.

And So?: It is about time one of the major publishers jumped into this lucrative $1.6 billion/15 million player (according to the Fantasy Sports Players Assoc.). Sports info provider CBS SportsLine now gets up to 23% of its revenues (over $10 million) from the 1 million leagues users pay to form at its site. Game companies should be lending their brands to this phenomenon, since it is still a fledgling game genre that could benefit from more polish and customer support. The pay-off is incredible user loyalty and a game platform that will almost certainly be among the first killer games on mobile. Crossing over fantasy leagues with connected console video gameplay could be a staggering market.

Whassup?: We need cheaper broadband and HDTV for online gaming to flourish, SCEA president Kaz Hirai told the Congressional Internet Caucus recently. The $40 a month fee for high speed access does not buy compelling content, which the game companies have, he says. Likewise, we need cheaper HDTVs in order for gamers to appreciate the hi-res capabilities of games. Kaz neglected to mention whether he was preparing to partner with all of those ISPs and TV makers that are holding his company back from networked Nirvana.

And So?: It's always so quaint to hear one of the largest entertainment conglomerates in history whine that other industries are holding it back from - what -- world domination? The truth is that connected consoles are proving to be a slower sell than Sony or Microsoft would like and the price of broadband has nothing to do with it. So long as networked consoles focus on multiplay, they will continue to appeal to a sizeable but limited niche, probably 10% of the addressable market. In fact, Sony and others do not have the content to drive mass adoption of online play...yet.

Whassup?: The Japanese games market has suffered a 40% decline since 1997, says the Computer Entertainment Software Association, and final 2003 figures didn't make things any better. Game revenues were down 11% during the year, led by a 16.7% fall in hardware sales. Conventional wisdom is that consoles have reached their saturation point in Japan. Still, software, too, was down 8.2% as CESA admits the raw audience for gaming there is now contracting. The Japanese market is now less than half the size of the U.S. market. Renewed interest in the GameCube in early 2004 seem to have brought the market back somewhat ( 3% revenues vs. same period last year), but industry analysts are hopeful that the PSP and DS will help re-ignite the market in 2005. And So?: The Japanese market is only a limited window on how the U.S. will manage the transition, since much of the Japanese decline is cultural, an obvious waning interest in gaming. Nevertheless, CESA does argue that gaming is losing its audience there, in part because players are turned off by increasingly sophisticated and complex titles. In all of the analyses trumpeting the "aging gamer" expanding the U.S. market, we have not heard enough about how time-constrained and stressed that gamer is, and how much he or she craves different sorts of simple and therapeutic gaming experiences. The downloadable casual gamemakers already knows that it gets a large part of its audience from these tired "ex-core" gamers. But are the major publishers ready to serve them?