Gabe Newell: Big companies won't stay relevant.

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Archie

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http://www.computerandvideogames.com/386224/newell-big-companies-wont-stay-relevant/

Large games corporations built on traditional production models will not remain relevant in the new age of gaming, Valve president Gabe Newell has warned.


Speaking on the subject of changes to games production and finance models, Newell said "philosophically I'm a big fan of what Kickstarter and other efforts like it are trying to do".
In a new interview published on The Nerdist, Newell continued: "There are a bunch of different ways that communities can drive what is going to happen, and one of the last pieces is to figure out how the community itself can drive the financing of projects. I actually think that's going to happen regardless [of Kickstarter].

"The earlier [fans] start supporting a project, the greater the results are going to be.

"Entertainment will get better, creators will do better, I think the percentage of control and the amount of money that goes to things like distribution and marketing will fall, and I think that's a fine thing."

In the age where the line between creators and consumers continues to blur, Newell said that companies built for older models won't be able to adapt fast enough.

"I doubt that a lot of the larger corporations will be able to make transitions into the new world."

When asked in the interview how large corporations can remain relevant, Newell said: "I don't think the big companies will. I think the rate of change is too fast for most of them to adapt."

Kickstarter game projects attracted $83 million worth of funding in 2012, according to the crowdfunding network.

A crowdfunding craze has swept the games industry following the blistering success of the Double Fine Adventure game, which in March sought $400,000 and managed to attract $3.3 million in pledges.

Following this was a new wave of Kickstarter game projects, many of them successful.
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Sucks for Valve then...

Also, I dont see large companies going out of style in the regular world, so dont see why they would in the games world either.
 
I can't see them being phased out but they will become less prominent. Then again, Kickstarter will become a big company, helping out little companies to get started. Wut.
 
Kickstarter is awesome but a bit too over-crowded with little or no working prototype.

That and traditional business model is here to stay with the release of new consoles on horizon.

Until digital distribution takes over physical, they're here to stay.
 
Funny how something that works towards his own profit and companies betterment happens to be his opinion, what a coincedence.

This is wishful thinking on gabens part, video games are making more money now than they ever have and have become even more mainstream. Yes mobile games are popular and yes kickstarter is cool, but the lions share of the profits are going to Microsoft and Sony and Nintendo for games on their consoles. Until people can make tens of millions of dollars just on steam alone, they will need console manufacturers.
 
Kickstarters aren't 100% foolproof, and a lot of people donate to a those high profile games because of a big name.

And look what Valve did recently with WarZ. They let through the biggest sham of all time to their consumers. Gabe Newell isn't a fan of big companies, well he's one, and he's gotta be responsible.

Kaijima said:
I'm playing one of the results of that scam now, and it truly wouldn't have ever existed without Kickstarter.

So here's to a healthy future of wonderful scams.
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You're thinking that because you think there are no other methods of funding. I know a few indie studios that needed no such funding to get started.

Kickstarter simply makes the business side of game development irrelevant. And when those indie studios try to make it on their own, they won't have the experience.
 
Well it's said and done. Gaben's success has proven for him to be much wiser than Microsoft, Nintendo, and Sony. If only those three have been around as long as him. Shame for the big companies. It's been a good run.
 
specialguy said:
Sucks for Valve then...
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Compared to Sony, MS, Nintendo and many Publishers Valve is pretty tiny.. lol.

Shining Sunshine said:
Kickstarters aren't 100% foolproof, and a lot of people donate to a those high profile games because of a big name.

And look what Valve did recently with WarZ. They let through the biggest sham of all time to their consumers. Gabe Newell isn't a fan of big companies, well he's one, and he's gotta be responsible.
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Unlike many big companies though Valve quickly fixed the Warz scenario and offered refunds to everyone. Something that would have taken most game corporations forever.. Remember the whole EA MS thing where people were getting scammed on 360 from some soccer game? Remember how long that was around and how long people waited their accounts fixed,resolved and refunded. Yeah..
 
I've never seen a really smart head of a really smart company that's made some incredibly successful predictions about the future attract so much hatred every time he says anything at all
 
I think he's dead on correct.

The same thing has happened to traditional software vendors in the 2000s. Small boutique studios and small, focused web services are eating IBM, EMC, HP, Oracle's enterprise lunches.

Kickstarter has an Achilles heel: it is not an accountable financing mechanism (because until recently crowd-financing small companies hasn't been legal). Imagine a Kickstarter where you get EQUITY in the company or REVENUE SHARING for the project by being an early backer. That's coming, and when it does, the community sites are going to drive everything.

Big houses like EA that churn out all this shit no one wants are—everyone would admit—economically inefficient. Microfinancing could be so relatively efficient that EA will find its margins evaporate and it could have trouble competing.
 
Atomski said:
Unlike many big companies though Valve quickly fixed the Warz scenario and offered refunds to everyone. Something that would have taken most game corporations forever.. Remember the whole EA MS thing where people were getting scammed on 360 from some soccer game? Remember how long that was around and how long people waited their accounts fixed and resolved.
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Valve should not have let it out in the first place. Same can be said of something like EA's PC version of Tiger Woods fiasco. But EA issued refunds just as quick.

You're really just being selective on your examples.

And that "FIFA hack" was not resolved because MS didn't want to take the blame and show that their online security was compromised.
 
yep, old institutions are crumbling. i pity those who hate math, they're gonna have a rough time in the 21st century.
 
Also he's not necessarily talking about Kickstarter specifically, he's been going on about community alpha funding for years

It wouldn't surprise me if that gets integrated into Greenlight sooner or later
 
Big ships can't be steered as easily as smaller ships, and the wind and currents change very rapidly in the game industry.

You can't buy adaptation to market conditions, so it doesn't matter how much money big companies, it doesn't help them adapt, beyond buying the smaller companies that can adapt more rapidly or doing business through them.

Big corporations' goals are usually to make a lot of money so that the executives can give themselves big salaries and bonuses, and give money back to shareholders. Their goal is rarely to remain relevant. Only a few big companies think of their ability to remain relevant first and foremost, usually the best of them, and they are extremely few.

Darryl said:
probably the publishers like EA, Activision, Ubisoft,
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Take 2 has a bigger market capitalization than Ubisoft (Ubisoft is at around 750M, Take2 is at 1.1B). I don't know why people always assume Ubisoft is huge.
 
If he is talking 10 years from now I can see that happening. The next generation of gamers under 10-15 are being sucked into tablet gaming. The games are cheap or free to play and you have a portable device that can also do other things. Tablet gaming just is not for big budget games by big companies. The first casuality is traditional hand held gaming. I can see consoles being next.
 
Quasar said:
It will be interesting to see how things like the Doublefine Adventure, Wasteland2, Shadowrun, Project Eternity, Elite and Star Citizen play out and the impact the success/failure of those impacts game projects.
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But there have been Kickstarter games that have been a success. FTL and Chivalry were both Kickstarter games and most people consider them to be excellent games. Of course not all titles are quality, but Kickstarter has proven to be a success.

I disagree with Gabe here. Are small companies going to make something as grandiose as Final Fantasy or Halo? People clamor for those large scale titles that smaller companies are unable to produce.
 
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