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Why do AAA console developers find making social games so hard?

By on May 13, 2010
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I am a big fan of Steve Blank.

He teaches entrepreneurship at Berkeley and Stanford and wrote Four Steps to the Epiphany.

In his most recent blog post, he attempts to answer the question: “Should an entrepreneur have an MBA?”

When a former student asks if he should do an MBA, he listens to the guy’s questions, then draws the following picture and asks which bits he prefers:

The key message is that very different skills are needed in the search for the business model and the execution of the business model. (Read the full post on Entrepreneurial Finishing School to get the full explanation.)

It made me think about the games business.

Most AAA console developers think that they are entrepreneurs because they have started up and run their own companies.

But in most cases, that is not true. The business model was clear: pitch a game to a publisher, get a multi-million dollar advance, make the game.

That is no longer the case.

Should the company make iPhone games? Social games? PSN games? Will consumers prefer subscriptions or microtransactions or one-off purchases? Which marketing methods work best?

The truth is that entrepreneurs need to experiment. Executives are rubbish at experimentation.

So which are you: an entrepreneur or an executive?

About Nicholas Lovell

Nicholas is the founder of Gamesbrief, a blog dedicated to the business of games. It aims to be informative, authoritative and above all helpful to developers grappling with business strategy. He is the author of a growing list of books about making money in the games industry and other digital media, including How to Publish a Game and Design Rules for Free-to-Play Games, and Penguin-published title The Curve:
  • I think you've hit the nail on the head. Developers are still more fixated on technology and gameplay than business and markets.

    Gameplay matters. Technology matters.

    But making what customers want and will pay for matters more. And I think that there are still some challenges in helping developers understand this.

    It's the bit that interests me the most, which I guess is why I get quite a lot of consultancy work 🙂

  • Bearing all that crap in mind, I'd add another item to the right side.

    Whereas the left has “product/market fit”, the right has something like “incremental product innovation” — the basic outlines for what the market wants are already defined, and it's just a question of refining the product to make something that fits the market better and better.

  • Yep.

    I don't think it's only AAA console devs having this problem.

    Underlying it is that there are two important kinds of innovation:

    – Product / technical innovation
    – Business model innovation

    Even indie developers are generally much more excited by technical innovation — making a better, clever, more advanced game — than they are in business model innovation.

    Look at the excitement that indie devs have about 3D games in the browser, compared to the cool reception 3D web games tend to get from players.

    Personally I find technical innovation dull and find it much more interesting to use limited technical skills to solve new, interesting business problems. That makes social games appealing to me — but not to the average game developer, who'd rather find a way to put more polygons on a screen 😛