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HMV's Simon Fox - 1

The entertainment retailer's CEO on a tough climate, the Facebook threat and motion control

GamesIndustry.biz That's an astonishing statistic - while the games industry is doing what it can to eradicate piracy, it's fortunate that it's not quite that bad...
Simon Fox

Yes - but free entertainment can be legal or illegal - the ad-funded model is another increasingly attractive model. So you'd have to say that in total, the availability of free entertainment is again eroding into any form of paid-for entertainment. If your choice for a weekend is to buy a computer game at £30-40, or spend more time on Facebook, maybe stream a movie and play some apps - I do think people are making those trade-offs, particularly in tougher economic times.

That's not an excuse, I just think that's what an element of our customers are doing.

GamesIndustry.biz And there are some very successful companies out there that are focusing on the free-to-play model - I guess the difference now is that while for a long time 'free' tended to imply poor production values, now that's not so much the case.
Simon Fox

I think to some degree, 'free' is now social. Harnessing that social element and combining it into free is quite an attractive option.

GamesIndustry.biz You mentioned the Wii market, but another segment that suffered in the past 12-18 months is the music game genre. If we're talking about Facebook and things like that as social entertainment, could that be a direct correlation?
Simon Fox

Well, those were great games when they were around - and I do think we shouldn't always be necessarily looking back and saying it would be great to have that again. The fact is, the publishers took advantage of a moment in time and did some great business with those music games - and HMV did particularly well because of our customer base. We enjoyed that and it was good business for a few years - there is still a market, but it's smaller.

We as retailers just have to understand and adapt - that market exists, it's smaller than it was, and we have to look for the next opportunity, whether that's in 3D gaming, or Gamerbase which is an interesting area that we're growing. Wherever it is we've got to be looking for that next wave.

GamesIndustry.biz Could it be Move and Kinect? Do those two platforms have an opportunity to capture the more casual/social audience?
Simon Fox

Well, look, I really hope so. Anything that prolongs the life of what are two great consoles, and bring new games into the market - and obviously the peripherals themselves - is great as far as we're concerned.

We're doing everything to get behind it and we'll have to see how customers react to it.

GamesIndustry.biz It's a slightly tricky thing to incorporate onto the shop floor, because it is something that takes up a lot of space - but it's also something that needs demonstrating? How do you give gamers that experience without sacrificing shelf space?
Simon Fox

Well it's not easy - and it's not so much space as the health and safety police, which constrain what one can do in the stores... Obviously we do benefit from having larger stores and a bit more space than some of our competitors - that's an advantage - and we've also got the Gamerbase opportunities to demonstrate.

But it's not straightforward - we can show videos and train our staff to explain, but also I think, frankly, that the manufacturers are doing a pretty good job.

GamesIndustry.biz Well, it's in the interests of Sony and Microsoft to get some marketing budget out there, whether it's in shopping malls, airports or wherever else. Obviously it's down to the platform holders to push that.
Simon Fox

Yes, I think anything they can do to generate awareness is good - as you know, we run festivals through our MAMA acquisition, and it was great to see a number of games companies with dance-type products in the festival. There were loads of people joining in - and trialling probably for the first time - some of the dance products that are out there.

So yes - awareness is always an issue with a new platform or console - but again, I think with Facebook and social media, with online video, I don't think there's going to be a huge problem of people not knowing.

GamesIndustry.biz PlayStation Move just launched at the end of last week - is there any indication yet as to how that's been going over the weekend?
Simon Fox

Well we're getting the numbers through at the moment, so I'd say so far so good - but it's not much more than 48 hours on, so it's a bit early to tell.

Simon Fox is CEO and MD of HMV UK & Ireland. Interview by Phil Elliott.

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