Video game developers brace for cash influx as tech companies vie for deals | Games
Video game developers are chomping at the bit before an influx of cash from some of the world’s biggest tech companies as they vie to build a “Netflix for games”.
At the center of the contest are Microsoft and Sony, followed by less gaming-focused companies like Apple, Amazon and Netflix who have all launched subscription services in a bid to attract gamers to their platforms.
Microsoft spent four years creating its flagship subscription, Xbox Game Pass, which offers unlimited access to over 100 games for its Xbox family of consoles for a monthly fee of £10.99. In March, Sony announced plans to compete directly with Game Pass with a series of changes to its PlayStation Plus service, which will eventually launch with 700 titles for £13.49 per month (or £99.99 per year), although largely focused on older titles.
Alongside the two console makers, a host of companies have launched similar services. Apple Arcade, for iPhone and Apple TV, offers unlimited access to over 200 mobile games for £4.99 per month; Amazon’s Luna service, currently in early access in the US, allows subscribers to stream 100 games for $5.99; and Netflix is experimenting with offering a selection of games for free alongside its movies and TV shows.
Competition has led to an influx of cash into the industry. Microsoft, the world’s second-richest company, has embarked on a wave of acquisitions, buying Call of Duty and Warcraft publisher Activision Blizzard, Skyrim developer Bethesda and nine independent studios since 2017 alone. Amazon and Apple, the fourth and first richest companies in the world, have equally deep pockets. Sony, with a market cap an order of magnitude smaller than the tech titans, has struggled to keep up, merging with developer Halo and Destiny Bungie earlier this year.
Even those who remained independent welcomed the new model, in which game developers paid a significant sum upfront to put their games on the services, greatly reducing the risk of launching a new title on digital storefronts where it can sink without a trace.
“For a lot of actual indie developers, someone who self-publishes a game, the chances of making it a success by just publishing it are pretty low,” says Tom Davis of Swedish indie publisher Thunderful. “Being able to get your game in front of the 25 million subscribers to something like Game Pass or this new PlayStation Plus thing, that also benefits sales – because people usually just talk about the game.”
Tom Mead, art director and co-founder of Bristol-based Spiral Circus, says platform deals are “actually quite a positive thing because it means you can get paid decently to develop the ideas you want, without necessarily having to worry about whether your game sells a bunch of copies at the end.
It is also hoped that the rise of subscription services will usher in a shift in focus for the industry, moving from multi-million dollar AAA titles to smaller, more original titles that are not meant to be confused with everyone in the world.
“Look back on Blockbuster,” says a producer at a major publisher who asked not to be named due to the commercial sensitivity of their dealings with the platforms. “I would go to Blockbuster on a Friday, not even knowing what games exist, to watch a bunch of physical games and pick one for the weekend. With Game Pass, everyone gets everything, and they might only play it for a few minutes, but they get to see if it’s for them.
There are also fears for the future. A developer who left a Silicon Valley giant to go independent says he’s worried about what will happen when Sony’s money runs out. “It works while they fight for platform dominance,” they say – but if one platform wins the fight, could developer payouts be reduced even if subscription fees go up?
But even those with little to gain from the model agree that it currently works for gamers. Super Rare Games is a UK company that sells physical copies of previously download-only titles, and Ryan Brown, the company’s “word boss”, argues that the two approaches can co-exist.
“I use these services, they are undeniably incredibly convenient. But for people who want to, myself included, there are games they’ll want to be able to play 50 years from now, and that’s what physical games generally offer: the property you can’t have with a subscription.