GC: Tough times ahead as next-gen consoles arrive - Daglow

Stormfront Studio CEO Don Daglow has told GamesIndustry.biz that there are difficult times ahead for the industry as the next-gen consoles arrive and publishers become more wary of original IP.

Speaking in an exclusive interview, Daglow said: "At the end of any hardware cycle, you have a huge installed base worldwide. It's the easiest time to make money with a title, because you have the most machines out there which can play your game.

"Generally it's jostling between the hardware manufacturers that drives the move into next-gen. Nobody's in a hurry for that to happen inside the business, because instead of having millions and millions we can sell to, suddenly we're down to a few million real dedicated gamers."

According to Daglow, total sales in the industry are set to drop as the new consoles arrive, and business models will become stretched due to reduced royalty potential.

"You have to go through all the work of the learning curve when you're at a point where you're going to get paid less money... If you look back at the previous next-gen revolution, 2000 and 2001 were pretty slim pickings, because the installed base was way down. And those are always tough times."

Daglow also predicted that publishers are likely to become more reliant on tried and trusted formulas, rather than investing in innovative products, as the next-gen console cycle gets underway.

"Creativity requires a tolerance for higher risk, because a higher percentage of - quote unquote - creative titles die a lonely, ugly death. Something that is more mainstream has a highler likelihood of success," he observed.

"I've got buddies who are in studios inside publishers, and they'll talk about the fact that that's when they'll get asked just to do sequels, because they have a big team, and the publisher has an ongoing investment... Any next-gen introduction reduces the tolerance for risk."

The irony, Daglow believes, is that although new hardware gives developers much more scope to produce innovative IP, their ability to do so is simultaneously constrained by financial pressures.

"When you stretch the industry, what we think of as creativity is pushed back, ironically by the introduction of the potential for future creativity," he concluded.