Alan Miller: Part 2

The Activision co-founder on new IP, digital marketing and the loss of Guitar Hero

Feature by Phil Elliott Contributor

Published on Feb. 21, 2011

GamesIndustry.biz Well, if there are frustrations or barriers in games, the core gamers are more likely to find solutions themselves (or online) - but it's arguably much more important for social and casual games to eliminate bottlenecks because chances are those gamers will just bounce off.

Alan Miller

I agree entirely with that point. As you say, core gamers are pretty much committed to the games, and spending a significant amount of money on them. But the more casual, social gamers don't have that commitment; so publishers have to work very hard to convince these online game players to make purchases - they have to provide them with wonderful game experiences.

Just about everybody is providing a basic level of play for free - but the real trick is how you can entice a player into spending money, to get them into the game, to enjoy certain aspects of the game... but to voluntarily pay to do so.

Providing good behavioural analytics is much more important for casual game audiences than it is for core - but it's still extremely useful for the core audience too.

GamesIndustry.biz Certainly in the core market we've seen key franchises generally flourish, while bringing new IP to gamers has become ever more challenging. But is that the same for the social network games environment?

Alan Miller

Well, licensed IP became important for games that were distributed at retail, and the industry in general adopted that heavily. However, that hasn't been much of an issue for the online industry so far - it's grown to be in excess of $10 billion in revenue with an almost negligible reliance on licensed IP.

I think over time we'll see more of it coming into online games, and I'm very interested in the results. Gazillion will be bringing out Marvel Universe next year I believe it is, and I'm curious to see the response to that; but I really think that non-licensed or original IP has been around in online games for quite a while.

And a lot of the big publishers sort of acknowledge that. Disney purchased Club Penguin and Playdom and that's an endorsement that they consider these companies, that have been developing without the use of any licensed IP, to be important. Playfish was acquired by Electronic Arts in an identical situation. So I think, somehow, it's of less importance to the online game industry.

GamesIndustry.biz And that's good news for the small companies, who can come up with good ideas and not have to rely on a license.

Alan Miller

I think the bottom line is that high quality games will do better online than at retail. That sounds funny - but what I mean by that is that being successful at retail distribution wasn't simply a function of having a high quality game. I'm sure we've all bought games that were wonderful eye candy, or were involved with a licensed IP... but the games were not very good.

But in the online space, because there aren't the barriers that had been imposed by retail distribution, game publishers could create wonderfully entertaining games - and people will find out about them. I don't think it's going to be dominated by licensed products - but I could be wrong.

GamesIndustry.biz There seem to be two schools of thought about marketing for online - some people seem convinced that without any marketing you don't stand any chance at all; but others preach a view that if a game has genuine quality it will succeed. What's your view?

Alan Miller

Up to this point very little has been spent marketing online games. I think there might be a difference of perception about high quality production values versus entertainment - they're not the same. You can invest a lot of money in something that's very pretty, but it might not be entertaining, so a lot of people can get frustrated - they put a lot of effort in, then when it's released online it doesn't do well. Perhaps that's because it's not entertaining.

I do think publishers will begin to spend more on marketing to make consumers aware of their products; but there isn't the shelf space constraint that there was at retail - anybody can get their game online, and I do believe in the power of the internet, the power of the social grid, to inform players about what's good.

So I come down on the side that says marketing and advertising is much less important in the online space than the retail space.