NBCUniversal decided to close its gaming department after nearly three years. The company will use a strategy for licensing games to external game developers and publishers. It could still thrive on games, but it's a strategy with less risk and less rewards.
And it's not the first time a big Hollywood studio is doing this. A few years ago, Disney discontinued its mobile gaming publishing business and switched to licensing. Recently, FoxNext Games was acquired with the acquisition of Fox, and now Disney also sells this game section.
However, games are the preferred form of entertainment for the millennial generation, which is why games have grown to $ 180 billion in business. What explains this swing in Hollywood? I mentioned some of these on Friday in my DeanBeat column. I also hosted a panel at GameDaily Connect in Anaheim, California, just a stone's throw away from Disneyland. Our topic covered a part of the same topic and almost predicted some of the business decisions Hollywood managers are currently making.
Panelists included Steve Fowler, senior vice president of marketing at FoxNext Games; Guy Costantini, Vice President of Global Interactive Marketing at Skydance; Matt McMahon, senior vice president of business development for Seriously; and Barry Dorf, Business Development for Amazon Game Services on Amazon.
We had a lively discussion, though perhaps I was the freest to voice my opinion on games and Hollywood. That's what I did, as you can see in the edited minutes of our interview.
Steve Fowler: I'm the senior vice president of marketing and publishing at FoxNext Games. It's a bit complicated. Fox used to be another company. Now we are under Disney. But we are the first party group. We have four development studios.
One game, Marvel Strike Force, is live and quite successful. That was our first mobile game. We just got another beta game in Canada and New Zealand called Storyscape. Choose your own adventure, experience Telltale Games, but with a certain Fox IP and a certain original IP. The third game is in two weeks in the technical beta. It is a strategy game based on James Cameron's avatar license. The last game we are working on and which we will see next year is a hardcore online shooter in the aliens universe.
Barry Village: I'm head of business development at Amazon Game Tech.
Guy Costantini: I work for skydance. We make films like Terminator, which you can see in November, and Mission Impossible. We also have a game studio that makes a series of VR games. We're working on a VR game in the Walking Dead universe called Walking Dead: Saints and Sinners. We will receive more information in the future.
Much of what we do – we are storytellers. We tell stories about games, television and other types of entertainment, hopefully to the delight of our players.
Matt McMahon: I am Senior Vice President of Business Development for Seriously. We are 100% owned by Seriously at the moment. We are now in the Playtika family. This is a moment for us – the platform relationship is a bit hybrid. It's all we do to expand our brand, our world, our characters on television, animation and consumer products. I oversee a number of things we do to grow the business.
To be more specific, I was at 20th Century Fox for 11 years before Seriously headed the third-party licensing business at Fox. Fox was not a first party at the time. We have licensed and tried to place our intellectual property with great developers in order to gain interesting experiences that people can enjoy as an extension of our films and television programs.
GamesBeat: I feel like in Hollywood and Games 4.0, something like that. What do you think of the 1.0 or 2.0 era to put everyone on the same level? We have decades of experience on this panel. How would you describe how it used to be?
Fowler: My first experience with licensed games was with Interplay 22 or 23 years ago. I was Brand Manager for the Star Trek games. I would say at this point, it was a kind of hand off. The studios were not real – I'm not sure if they even knew we were working on their license. That gave us a lot of freedom to experiment. We did some really cool strategy games back then. Maybe that was 1.0, which I remember. We had a Lord of the Rings game, a series of licensed games.
If you want to call it later than 2.0, Hollywood has begun to draw attention to us. I felt it had shifted to a point where Hollywood was looking at what we were doing to sell more of what they were driving. If they had a movie in the cinema, they had to outlicense the rights to a game that came out day and date with the movie. They considered it an extension to sell more tickets. This ultimately worsened the quality. Game development studios were forced to meet certain deadlines or incorporate features and characters into their games that were not necessarily great for the gameplay. Those were the past years of Hollywood and Games.
With the Marvel licenses and the Lightstorm partnerships we have, this is, at least from FoxNext's point of view, quite different. We first make great games and then use the popularity and awareness of beloved franchise companies. The partners understand that. Marvel, with whom we are deeply connected – we have the deepest relationship with them, since one and a half years at Strike Force – is a great partner.
They are probably one of the most serious groups for us category, with a dedicated team of people coming from the gaming world. Jay Ong used to be with Blizzard. They understand it completely. The partnership we have with them is such that they succeed if we succeed. It has really changed from what it was to where it is now. Most successful licensors and game studios know that this is not a support business. Games are a front line business.
Village: When I was at EA, we received the Harry Potter license. 1.0 was for me that you did not just make a game. They've been trying to make franchises that run for 10-15 years for every new movie and book. It was a much bigger deal, much bigger partnerships. You were in bed forever when you logged in with something in the days of the consoles.
When I was at DeNA, you talked to Marvel or Star Wars, these licensees – you have a game with a mechanic that works, and then we'll add the IP and it can be an accelerator. If the functionality did not exist, the gameplay did not exist, the KPIs did not exist, they did not want to talk to you no matter how tall you were. There was no time for risks.
There is so much noise in all shops with all games. At 1.0 or 2.0 that was not true. If you had the Harry Potter license, you owned the Harry Potter license and that was it. Even when we played Lord of the Rings on EA, there was no other game within months. Now they put windows into the app stores – you have a four-week window where you'll be the only new Marvel game coming out. That's it. When four weeks have passed, there is another game. You can not miss your date, because that's all the time you have, unless you're working on a smaller license, rather a niche game in which you're more likely to have a window.
Costantini: I can not comment on 1.0. I think I enjoyed the fruits of your work back then. [laughs]
Fowler: Want to say that I'm old?
Costantini: I think I just thank you? But I have experience with mobile games at Kabam. We had a Marvel Contest of Champions. We did a Star Wars game and a Lord of the Rings game. They all had different degrees of success, commercial and critical. That was the last generation. It took a while for the mobile gaming area to be understood. First they came across a gold mine. They thought they could just print money. You have not noticed that this is strip mining.
Now we finally come to a point where you have mobile games that are really fun. They compete with the traditional games because different things make you happy when you play them. You have an execution like Contest of Champions and the stuff that Supercell does is just better. I do not need the sorcerer on my phone. I do not have time to play Witcher on my phone. But when I have time to play on my phone, I want to play something specific, something good, something that does not just reach into my pocket and tries to empty my bank account.
The companies that understand this become the reaping success of building long-term relationships with their players. Some companies, especially those on this stage, get it. This development is beginning to emerge. We see cross-platform games that work great on all platforms. There are no fixed rules about what works and what does not. From our point of view, we want to tell great stories and make great games. That has always been the common denominator for long-term success. If you can and know where people consume their experiences, you will see success across the board.
Do you have a small window, a long window? If you have a bit of experience, you can get people back with a strong live operations plan. There are many ways to succeed. But as you have already mentioned, there is a lot of noise. You need a solid strategy. What will you do to get away?
McMahon: I entered the 2.0 phase. I think there was a window where you could experiment with many crazy games. I remember the Predator game we did with a tiny studio in Romania. It was a great little game in itself, but it did not address many of the issues you raised.
One of the things we were struggling with – and games have nearly swept the studios and forced them to deal with it – is this idea of spawning – that games are your best live service franchise element. You make a daily game. That's what mobile games are all about. There is a forced loop. There is a loopback. It's all built in so you can come back regularly. You will not be back in three years when Ice Age 15 comes out.
You have this ability to intelligently execute live ops, intelligently communicate with your community, and connect with your audience in an intelligent way. At least when I was at Fox, five or six years ago, this was a cognitive bridge we wanted to cross. All the game companies tried to get the studios to cross this bridge. Again and again, we came up with the idea, "Do not sweat, you're in the licensing business, it's a big contribution to the whole company, but it's in the TV window, it's in the Special Edition DVD window. too much to do. "
I think it's time now that not only the big Hollywood studios realize how lucrative these games can be, but that they can be your first daily point of contact. Players play 45 minutes a day, one hour a day on their most personal, intimate devices. If that happens all the time, it's a great franchise management tool and a great channel.
It seems like games have to move Hollywood to it. They were in an old business model that was not aimed directly at the consumer. Obviously, that has changed fundamentally. They did not focus on live operations. That has changed. They did not focus on how digital a franchise management tool can be.