Amazon can dominate casual gaming if it follows Steam’s lead
Greetings Readers!
For those that need catching up to speed, today, Amazon announced it is going to start doing digital downloads of causal pc games. With casual gaming growing faster than ever, this is a market they can easily compete in, but if they want to dominate it, there are several key things that they have to do.
Digital downloads for casual games and even core PC games such as Call of Duty and Unreal Tournament have been around for years. Until recently, little attention has ever been paid to casual gaming except when people are bored and get the itch to play some Pool on Yahoo. For years, if you thought about digital downloads for PC games, the main thing that would come to mind is Steam. Steam is the supreme digital download platform for many of the biggest PC games on the market and even has some smaller, more casual games, but has never been known for casual gaming. There has never been a Steam equivalent for casual gamers.
In the casual gaming market, there are a couple of major players, mainly Microsoft's MSN Gaming Zone, Yahoo Games and EA's Pogo.com. These sites have done very well for themselves and I often see thousands of people at any given time playing games such as Pool on Yahoo or Keno on Pogo. My mother even downloads many games from Zone. Despite the relative success these sites have attained over the years, each still lacks something that would allow them to dominate the space. This lack of market domination is something that Amazon believes it can change. By starting with 500 games and offering free demos, it seems to be well on its way to becoming a serious player in the casual gaming market if not the dominating player.
Like every market, there are some keys to success and the first one that Amazon must master is that of the customer experience. It is not enough just to have a convenient way to purchase games, but there are several key points that Amazon must perfect to dominate. Meeting if not undercutting the prices of competitors would be a great start. Getting rid of any DRM associated with the games would be another great step in the right direction. Users must be able to download a game as many times as they need. Finally, there needs to be an easy way to patch games.
All of the points I just listed are items that Steam has managed to accomplish which has put it above other digital gaming download alternatives such as EA's download store and Gamestop's digital downloads. Competitive pricing is key for digital downloads. Doing something similar to Steam and having the occasional sale of certain games for dirt cheap prices is also a good idea. Giving customers a cheaper price because they don't have to get all of the physical stuff is really the point of digital downloads in my mind. DRM of course is a huge issue. With news about how Gears of War on the PC has been more or less killed because of DRM, it demonstrates how big of a headache it can be for users and the more casual the user you are targeting, the worse DRM is going to be if they run into problems. Of course patching also needs to be made easier as well, something that Steam has accomplish with amazing results. Having games update themselves without user action is the key. Gamers, casual gamers especially, don't like to be bounced around to different websites to keep their games in top shape, a major issue in the pc gaming world. If this can be transparent to the point that the user doesn't even know it is happening or needs done, you can put yourself above the competition.
The best way to accomplish these would be to create a download portal similar to Steam, but I have yet to see Amazon take any interest in the desktop software space. Having a software interface would be much more convienent for users than having to navigate the website in the way that Kindle users can purchase books on their device rather than having users go to a computer, go to the website and then purchase books. I believe this is one of the biggest factors in being able to dominate this space.
If Amazon can manage to do well, they have the desire to do the same with more mainstream games such as Call of Duty, Spore or even Grand Theft Auto. This of course is a market almost completely controlled by Steam. If they hope to become real competition for Steam, not only do they have to provide the same service as Steam, but they must be at least 50% better. I am a firm believer in the idea that if you want to compete with a major market player, your product must be at least 50-100% better than your biggest competition.
These are just some of the things that Amazon needs to do to compete in the digital gaming download space. Amazon has an excellent chance at becoming a major player in the casual gaming market, but if they hope to become the leader of it, they have to innovate in a marketplace that outside of new content has been stagnant in terms of innovation for years.
What do you think of Amazon's new casual gaming download service? Will you use it? Do you think it can compete with other established services such as Yahoo Games that have been around for many years? How long do you predict it will take before they can become a serious competitor or dominant player in the casual gaming distribution market?
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-Jeremy "pcnerd37" Bray
EA Has Major Problems That Must Be Fixed or Face Shutting Down
Greetings Readers!
I will admit that I haven't been a fan of Electronic Arts for a long time. While I admit they make an occasional good game, most of their games are new versions of old games with small changes every year. This is just the start of my large list of issues with EA. It is time I address all of my concerns about EA in hopes that they might (although not likely) see this and turn things around.
Lets start with the biggest issue first. Games that EA makes annually (Madden, NBA Live, and pretty much every other sports game on the market) need to change radically. While games such as Madden have come a long way over the years and is still a fun game to play, it and other EA sports games are essentially the same game every year with a new roster, a visual improvement or two and maybe a new feature or two. Minor changes such as this do not make games in and of themselves. There are less changes in an EA sports game than an expansion for any other game I have ever played. If you are making less changes than is made in a simple game expansion, you should not be charging $60 every year for a new version of the game. Honestly, for the few changes that there are, anything above $30 is too much considering that is the price of most expansion packs for games. If you insist on making these small changes instead of going for a new experience in a new edition of a game, sell them as digital downloads on things like Xbox Live and the PlayStation Store. Doing this would not only save the consumer time and money, but it would cut out many of the production costs associated with a new game.
Next on my list of issues with EA is support, especially for older titles. As most gamers know, the support that EA provides for its titles is often pathetic. Sports games often have their online component shut down after only a couple years of being available and many pc based games never get the patches they desperately need. When it comes to long term support, Blizzard beats every other gaming company by far. To this day, Blizzard still releases patches to StarCraft which is 10 years old. Most EA gamers are lucky to get a years worth of support from an EA game. EA has numberous Command & Conquer games in need of a patch but don't find it worth their time and effort to fix the problems with the games, even after they re-release them in a giant pack and are constantly packaging them in bundles. If you are going to continue to sell a game, you should continue to support the game, it is that simple. If EA patches a game any later than a year after a game is released, it is surprising. If EA wants to acquire loyal customers instead of drive more people to the 'Boycott EA' movement, this is something that it needs to start doing to gain a better reputation amongst the gaming industry.
Now, lets talk about DRM, the crowd favorite of all of the points I am addressing. If there is one thing gamers hate besides wasting money on a bad game, its having to deal with DRM on a likely bad game that they just wasted their money on. Earlier this year, EA released Spore, which quickly became the most pirated game of all time largely because of the heavy handed DRM placed on the game. The DRM issue sparked a huge backlash on various online sites such as Amazon which quickly had thousands of one star ratings in protest of the DRM. Unfortunately, EA did not learn their lesson from this. Instead, they just loosened the DRM restrictions on their next major game, Command & Conquer Red Alert 3. While some of the consessions were better than nothing, EA clearly still does not understand th headache that DRM causes legitimate customers. As Spore proved, DRM does little to prevent piracy and ends up hurting people who are willing to purchase the game. Assuming that everybody is out to steal your game just because a few people steal your game is a bad idea. I will admit that their move to Steam and not having DRM with it is a step in the right direction, but I think that has little to do with actually getting rid of DRM, which is what I will talk about next.
Until last week, it has seemed that EA has never really understood the digital download experience. Since many game purchases happen in store, EA never put a big emphasis on their own digital download software other than to bundle it with store bought games. Actually, it was probably a good thing that they never really pushed the product because never once, on any computer, could I ever get it to work. As of last week, EA will now be releasing their games on Steam. This is a move that I have dreamed they would do for a very long time. Digital downloads are great, especially if you are like me and have been burned by scratched disks in the past. I think if they put more emphasis on selling their products on Steam, it would greatly benefit them financially, especially since digital downloads cut out much of the production costs of selling a game at retail.
One of the biggest issues I have seen cause problems with EA lately is internal politics. The particular case I am refering to with this is the now canceled game, Tiberium (the new Command & Conquer FPS). Shortly after the game was canceled, team members started talking about issues with the team and why it was ultimately cancled (This is the announcement and the team members opinions are stated in the post comments). If you read the stories, it is clear that EA has problems with staffing and internal politics. When you have issues like this that kill much anticipated games and then have the team members air their grievences in the comments of news posts, you have a major issue that needs to be dealt with immediately. If you are going to make a quality product and do so in a timely manner, these issues cannot exist.
Before I talk about my final point, I wan't to address the lack of creativity and willingness to try new things. EA has a bigger problem with this than most in that once they have a franchise that is known to make a lot of money, such as Madden, they stick to making new versions of the same thing instead of getting creative and making new franchises. While I will admit that not every game or franchise is going to be as popular as a Halo or Half Life, you never know what might be the next big thing if you aren't willing to at least give an idea a try. I also find it kind of pathetic that some of the most unique gaming ideas are coming from one or two people that make homebrew games as a hobby. Eventually, gaming franchises will typically become old and boring until they turn into just plain bad games, the Sonic franchise is probably the best illustration of this. If you aren't on the look out for the next big thing, instead of growing, you will die a slow death when the franchises you have depended upon for years become stale and don't give consumers a reason to buy them.
While I may have a couple of other issues with EA, I have one last one that I really want to focus on, and that is EA's closing of gaming studios that it acquires. EA has a history of purchasing game studio after game studio, only to shut the studios down not long after they are acquired. While I will admit that if a gaming studio isn't profitable, it should be restructured or shut down, shutting studios down for virtually no reason other than to move teams to another location is just stupid. The best case for this that quickly comes to mind is that of Westwood Studios, creators of the Command & Conquer series, Dune and many other games. With projects in the works, EA decided to just shut down the wonderful studio for no apparent reason. While many of the Westwood employees were moved to EALA, and a few continue to make good Command & Conquer games, this move alienated thousands of fans, crippled the Command & Conquer gaming community (it still hasn't recovered despite the new game releases) and basically allowed the Boycott EA movement to gain momentum. I also have this issue with Microsoft over the closing of Ensemble Studios, but I will save that for another blog post. While consolidation might be a good thing, it is not a good thing when it ends up hurting gamers and results in a reduction in game quality. This really boils down to a single point, if you want people to be loyal to a franchise, don't kill the game studio that creates them , otherwise you are breaking that bond that consumers have with the game.
Those are just some of my issues with EA and how I think it can turn itself around into a major gaming company that few can compete with. If EA takes some of these ideas to heart, they can turn around their company and change public opinion about them in as little as a year or two.
-Jeremy "pcnerd37" Bray
Sony Announces Blu-spec CD, Another Format for a Dying Medium
Greetings Readers!
Yesterday, I wrote a post about how CD sales are down and Walmart is reducing the floor space it gives the CD. Clearly, the fools at Sony don't agree with my assessment of the CD and its impending death. Sony has now announced a new CD format, Blu-spec CD. This format is going to be dead before it even has a chance.
The new format is said to be backwards compatible with current CD players, so you will be able to play the blu-spec CDs in the CD players you already have, but what is the point? Are people really going to pay the higher cost of a new format when what they have works just fine and can play the same music, often at a better quality than the digital music that many people listen to now? Sony touts the new Blu-spec CD players will eliminate vibration and therefor make music quality better. When people are generally satisfied with compressed mp3 quality audio, do we really need something better than existing CD quality? I don't think so.
No prices have been announced for the music or the new players, although 60 titles will be available by Christmas. I certainly don't expect the prices to be cheap. Prices for new formats never are. The new technology will use the same Blue Laser Diode as Blu-ray, so from that alone, you can assume it will be quite expensive, especially when Blu-ray players are still running in the hundreds of dollars. With consumers moving in mass to digital downloads for their music, spending a large chunk of money on the new format of a dying medium makes no sense. Somebody needs to relay this message to Sony so that they stop wasting money trying to develop these formats, only to have them die right out of the gate.
While I will always love the CD and listen to it every time I am in my car, with sales down around 23% this quarter, it is not worth investing in a new format when the existing format is quickly dying out to something far more convenient. Sony would be better off to create their own store to compete with iTunes and others in the digital download space rather than to create a whole new format that is truly unnecessary.
The world is moving to digital downloads Sony, get on board and stop trying to keep the past alive!
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-Jeremy "pcnerd37" Bray
Walmart Signals the Death of CDs/DVDs, Looks to the Present and Future
Greetings Readers!
For the past month, maybe more, the local Wal-Marts have been undergoing a major shift. Nearly everything but groceries have changed their location. There are now more groceries, less pet supplies, and the electronics department has roughly doubled in size. Apparently this shift is taking place across the country. A post on Gizmodo today revealed a change in business at Wal-Mart when it comes to consumer electronics. It seems they are cutting back on CDs and DVDs to focus on other products such as Blu-ray.
With CD sales down, digital downloads through the roof, and Blu-ray hoping to replace DVD, such a move was destined to happen at some point, I was just starting to wonder when. With digital downloads exceeding many peoples expectations, it is a matter of time before the CD becomes just another dead physical format. With stores such as Walmart, Circuit City, Best Buy and others still promoting the latest music in CD format, I had honestly started to wonder just when digital downloads would kill the CD. I have known for some time that it was coming but haven't seen any sites of a death anytime soon, until today.
With CD sales down 23% just this quarter for Walmart, it is no surprise that they have now started to take away floor space from the CD and even the DVD to give more room for video games, various consumer electronics such as the iPod and Zune as well as Blu-ray. Such a move is a sign of the times and that death for the CD and DVD formats is nearing. I expect to see other major retailers follow suit in the near future. I will admit that with DVD sales still much higher than Blu-ray sales, I was kind of surprised to see this move at this time. I have long believed that this is necessary for the mass adoption of Blu-ray. When stores stop selling DVDs, people will start moving over to Blu-ray, just like they did for the transition from VHS to DVD. Blu-ray certainly has other issues that it needs to conquer before it can truly take the place of DVD, but this is the first step in the right direction.
While I agree with Walmart in their move to replace CD floor space with portable media players, that isn't really going to help them gain market share in the digital download space such much as it does iTunes and the Zune Marketplace. If they expect to see real success from this, they need to bundle a deal from their new digital download store with the devices. Walmart must give people an incentive to buy music from them before the customer becomes addicted to iTunes or other download service. If they did this, they would see huge growth in their new MP3 store while slowing the growth of their competition.
This is a clear sign that these formats are soon going to go the way of the formats that came before them. While the CD and DVD still have some life in them, if other stores follow suit and this falling sales trend continues, I can easily see the death of the CD within the next 2 years, and the death of the DVD within the next 5 (likely less).
Long live the extremely expensive Blu-ray!
-Jeremy "pcnerd37" Bray
Best Buy and Napster is a Match Made in Heaven!
Greetings Readers!
Before I continue talking about some of the TechCrunch50 companies, I figure I needed to address the Napster acquisition by Best Buy. There seems to be a lot of people in the blogosphere scratching their head about this move, so I figured I should explain why this is such a great move. This can actually be summed up in one name, Wal-Mart.
Like many of you, I woke up to the news this morning that Best Buy purchased Napster for $121 million in cash. I also noticed that the blogosphere seems to be at a complete loss as to the reason for this move. While I generally enjoy any opportunity to bash the company I refer to as "Worst Buy," I think they made a great business move with this purchase.
Wal-mart has been in the digital music distribution game for a while now, becoming the #2 company for selling downloadable music online behind only iTunes. Best Buy on the other hand is a bit late to the game when it comes to moving towards digital downloads. By Best Buy purchasing an established name with a large customer base (approx. 700,000 subscribers), they can quickly jump into the digital downloads game with minimal time and effort spent to develop their own solution to compete with the company that is essentially their largest competitor in many areas. Clearly realizing this is where the market is going, Best Buy needed to jump into digital downloads as soon as possible, and purchasing a company that has been synonymous with downloading music for over a decade is exactly what they needed to do before its too late and it becomes very difficult to gain any traction in the market. Creating their own service, working out distribution deals and many other things that come along with starting your own digital download service would have put Best Buy even further behind and would have likely lead to a number of logistical issues rather than allowing them to hit the ground running.
Not only is this the perfect business decision for Best Buy, who does not want to be left in the dust, it is also a big thing for Napster. Not only are they getting a nice sum of money, but the business they have can now be re-branded and taken to the next level. Napster has had a problem for years now in that it can't seem to shake off the bad image it received when it was taken down by the music industry. Many people are still unsure of the site because of its past, even though it has now become a legitimate place to get music. By having a huge company such as Best Buy purchase them, it basically validates what they are doing and gives them the image that now they are a legitimate music destination rather than a haven for pirates. It seems as though a major acquisition was the only way this image shift was going to occur. And being paid twice what the company is worth for that to happen, isn't a bad deal either.
This is essentially a win/win for everybody involved. Best Buy can jump into the market of music downloads with a large existing user base and can hit the ground running while Napster gets a big boost in their public image and paid twice what they company is worth. The only people that should be concerned about this union are other companies involved in the market such as Amazon and MySpace who is about to launch their own music service this month. Of course Wal-mart should be watching their back as well as this is a direct shot at them to send the signal that they aren't the only big company outside of Apple that can play the digital downloads game. It is only a matter of time until the two get into a heated battle in this space, which im sure will get ugly and allow Apple to run off with all the money while the two giants fight it out. This will be very exciting to watch no matter what and I look forward to seeing how the consumer benefits from this move.
That is all I have to say about this, but I do have more posts coming about several TechCrunch50 companies coming up over the next couple of days, so stay tuned for those! Don't forget to check out my daily podcast for more top technology stories such as this one at GeekNewsDaily.com!
-Jeremy "pcnerd37" Bray