2008 Overview

Making predictions is a risky business - especially on the Internet, where every thoughtless statement can end up preserved for eternity (or at least long enough for someone to taunt you with it for the rest of your life).

It seems to me that the person doing the predicting has three possible avenues: a conservative estimate practically guaranteed to come true, an educated guess often based upon inside information not available to the general public, and wild speculation which is almost always wrong.

For example, last year at this time I would have written the following: Sony needs to lower the price of the PS3 to become competitive (obvious), the Nintendo Wii will be in ample supply in the US no later than April (educated guess, but wrong), the PSP will be redesigned (inside information), and Peter Moore will get himself a "Red Rings of Death" tattoo (wildly inaccurate speculation).

Unfortunately, the only promising avenue for predictions is the one based upon inside information. However, those pesky non-disclosure agreements have a tendency to silence sources, and even when a journalist correctly predicts something without having inside information, no one will believe that he did not have advanced knowledge.

When it comes down to it, I think that the only reason that anyone actually reads predictions is to argue vehemently against them.

Realising that I'm in a no-win situation then, I am nevertheless offering the following insights on the upcoming year. While reading, keep in mind that if I truly knew the future, I would be a lot wealthier than I am right now.

The Trends:

We can't look back at 2007 without acknowledging some major mergers and acquisitions. Vivendi's acquisition of Activision is unquestionably the biggest story, as the new company is the world's largest independent videogame publisher. Beyond that, however, we have EA's acquisition of Bioware and Pandemic, Bungie becoming independent of Microsoft, Atari US on life support, and Bizarre Creations being picked up by Activision.

Undoubtedly, the acquisition trend will continue in 2008.

Take-Two and SCi/Eidos are still the most likely candidates for a merger or acquisition, but who can afford to purchase them aside from EA and Activision Blizzard? Ubisoft, perhaps? Then again, it would be hard to argue that these companies complement each other. Perhaps a Japanese company that hasn't had much success outside of its home territory would be a more suitable suitor. And there are other US companies such as THQ and Midway which, while not successful enough to be takeover targets, are too successful to be ignored. THQ tends to rely too much upon licensed IP which might not continue into the future, and Midway can't seem to push decent titles into the AAA category, but neither has a MMO franchise or an attractive IP to offer.

In any case, companies will continue to rise, merge, and fail in 2008. It's one of those "circle of life" kind of things. Just think of how many companies have been swallowed up or have disappeared during the past decade - Psygnosis, Acclaim, Fox Interactive, Titus, Interplay, Bam!, Hip Interactive, GT Interactive, 3DO, etc. With development costs rising on the latest generation of hardware, it will become more difficult for smaller companies to make money on their own. But, rest assured, as long as we are still willing to pay USD 60 a pop for a shiny software disc, there will be companies out there risking it all to get our hard earned money. And someone will come up with a unique game in 2008 that captures the public's attention - which will immediately be copied and milked to death until the next big thing comes along.

The Games:

The PSP is still looking for a killer app, and God of War: Chains of Olympus is probably not it - even though the game will definitely appeal to the hardcore players. While it will never catch the DS, PSP hardware sales are decent; software sales not so much. As for the Wii, Super Smash Brothers Brawl is probably the most highly anticipated just as Xbox 360 owners may be looking forward to Too Human. Meanwhile, the PS3 should see Little Big Planet as well as the launch of Home. All of these titles pale in comparison to GTA IV and MGS 4, however, not only in terms of interest but in importance to the publishers and developers.

Just as Halo 3 was the most anticipated game of 2007, GTA IV is certainly the most anticipated game of 2008. Publisher Take-Two doesn't have much riding on the outcome - other than the future of the entire company. Bioshock not withstanding, the company hasn't had much luck establishing new franchises outside of GTA. They can only get by on notoriety (thanks Manhunt 2) for so long.

Unfortunately for Rockstar, and for Take-Two, the world has changed since GTA III was released for the PS2 nearly seven years ago. Open world/sandbox gameplay is commonplace, and although no one has quite surpassed GTA, some (Crackdown, Saint's Row) have come close. Take-Two should be able to sell nearly a million copies of GTA IV across all platforms on the name alone, even if reviewers don't fancy the game, but if the programmers have trouble coming to grips with current hardware, or if they haven't fixed the perceived flaws of the prior games, the wheels may come off the franchise.

Right behind GTA IV in terms of importance for 2008 is Metal Gear Solid 4: Guns of the Patriots. For reasons which are beyond me, this franchise still has a fanatical following, despite awkward camera angles and convoluted plot lines.

For reasons also beyond me - seeing as how Microsoft would likely throw bags of money their way - Konami has chosen to release MGS 4 as a PlayStation 3 exclusive (for the time being). I don't think that the game is mainstream enough to be a system seller, so the question becomes whether or not the installed base of the PS3 is large enough for Konami to earn a return on their investment. That's even assuming the programmers have a handle on Sony's current console.

The Companies:

This latest hardware generation has had a rocky start, what with consoles that overheat, consoles priced USD 200 more than the competition, and consoles that cannot be found. Hopefully, the worst is behind us, and ample supply and a smaller price gap should see some heated competition.

If the "hardware wars" are a footrace, Nintendo is the underrated runner whom no one expected to do so well. It jumped strong off the blocks and immediately set a decent pace which shows no signs of slowing. On the other hand, it shows no signs of increasing its pace either.

Aside from the hardware shortages, Nintendo faces the problem of relatively low software sales. For a console that has been sold out for more than a year since its launch, you would expect a larger number of titles to reach the Top Ten sales charts. Part of the problem is that it seems a large number of non-gamers purchased the Wii as part of a cultural phenomenon - like the Cabbage Patch doll or Tickle Me Elmo before it - without intending to play much more than the pack-in Wii Sports disc.

Another problem is that, like the GameCube and N64 before it, the Nintendo titles are selling much better than third-party titles, although this is hardly unexpected. Nintendo has a large stable of popular characters to draw from, and talented designers and programmers to boot. When stacked up against games from publishers who quickly shoveled something out the door in an attempt to cash in on the Wii's success, who wouldn't prefer Nintendo's titles? The installed base is obviously there, but what percent of this base are hardcore gamers who will purchase a lot of software?

Microsoft, meanwhile, is the runner who got off to a head start, stumbled a little, got back up to speed, but seems to have almost exhausted its energy. Everyone who wanted an Xbox 360 had very good reasons to purchase one in 2007 - the extended warranty, the new models, the price cut, the release of Halo 3, and strong titles such as Gears of War and Bioshock. Yet the system remains far behind the competition in Japan, and isn't quite as popular in Europe as it is in North America. As I write this, the Wii has either equaled or surpassed the 360 in sales, eliminating the 360's advantage.

Microsoft's problem, it seems to me, is the same one it had with the original Xbox - namely, how to attract the mainstream? It's hard not to argue that the 360 is a console for hardcore gamers, considering that its most successful games (Halo 3, Gears of War, Bioshock, The Orange Box) are M-rated shooters. Microsoft also doesn't seem too concerned about losing developers such as Bizarre Creations and Bioware, even though these companies are best known for Xbox exclusives such as Project Gotham Racing, SW: Knights of the Old Republic, Jade Empire, and Mass Effect. As for Rare, the company Microsoft wooed away from Nintendo, it hasn't yet been able to attract the mainstream with more family-friendly fare such as Viva Pinata and Kameo. Xbox Live Arcade seems like a good way to reach casual gamers, but are they savvy enough to handle downloads?

For 2008, Microsoft needs to show that it hasn't already shot its wad. Fortunately, it has the financial capability of purchasing almost any developer it wants to, and it could take drastic steps such as further price reductions or cutting Xbox Live membership fees if it feels threatened by Sony's upcoming digital download services.

Speaking of which, Sony was the company everyone loved to pick on in 2007. Not that they didn't invite criticism, with inconsistent statements and seemingly arrogant words from company spokespersons, not to mention some b-a-a-a-d PR decisions (yes, that is supposed to be the sound of a goat).

Back to the footrace analogy, Sony is the runner who missed the starting gun because it was too busy admiring its medals from the prior two races. Or maybe it was too busy telling the press how well it was going to do at the end of this race. In any case, it finally realised that its competition was well ahead, and after a shaky start has started running for its life. The good news is that it appears to have a lot of energy in reserve, with stronger first-party titles than it has had in the past.

The fact that PS2 software regularly charts above 360 and Wii titles in a lot of countries seems to indicate that a lot of people haven't made the switch to the new hardware generation - at least, not in great numbers. If and when these PS2 gamers "trade up," I think it is likely they will stay loyal to the Sony brand. That is, if they haven't become interested in a Wii or an Xbox 360 by now, they probably never will.

With Nintendo going steady, Microsoft seeming to start to fade a bit, and Sony seeming to pick up the pace, it is going to be an interesting year. So many of the biggest games are cross platform that the burden will fall upon first-party software to capture the public's attention. That's a matter of personal taste, and if I truly understood why people bought certain games over others, I'd be in demand as an analyst.

One thing is for sure - with the gaming industry still so young, and much more reliant upon technology than any other forms of entertainment, it will never be a dull moment!