I've really enjoyed the back and forth, surfer. I come here to get assumptions challenged and to be forced to think through things thoroughly. So thanks.
Oh, really? I'd been told there were numerous third-party million-sellers on Wii.
Just shy of 40 3rd party games reached that threshold. I would call maybe 4, tops, of those "shovelware" which is the term you used I was referring to. Very little "shovelware" had any kind of sales success.
That's because they cranked out a bunch of releases with different collections of songs, I assume? (As opposed to selling instruments, which I assume get tracked as accessories.)
Guitar Hero and Rock Band were cultural phenomena in the US. They couldn't make enough for a couple years there, then it cratered. You can see it in the chart. Instruments sold with Software in the bundles is counted as software revenues, not accessories.
How much of that stuff did they sell? Just how big is that peak, in dollars? (What exactly is the difference between spending in 2006 and spending in 2008?)
You know I can't tell you that. It was a lot.
So, handhelds weren't a significant part of the spike? I noticed a few interesting landmarks
No, handhelds were not a significant part of the spike. Same trend chart, this time console only.
I'm really at a loss to explain why we're discussing the health of the console market without actually examining it. =/
LOL, I'm not discussing the health of the console market. I keep typing this.
Sorry, what does that mean?
Regression to the mean is, at its most basic, is a technical way of saying things even out over time.
Look at the 1993 to 2006 trend in that chart. Some bumps in the road, but generally, you can throw a line in there and have a pretty good chance of being close to any particular year's performance.
But then 2007 comes along, huge spike. Kotick says "games are recession proof" people go nuts thinking that video games will grow forever and hundreds and hundreds of games are made, shovelware and not. But then, in 2009, you start seeing the regression to the long term average, which we again hit in 2012.
And what happened in 2012? People were screaming that the death of consoles was here, no one would buy PS4 or Xbox One, Mobile was king blah blah blah. Companies stopped investing as much in developing games.
But since then? Well, we've come down even farther below the mean, but signs are that sales should now grow back to the old average trend... back to regressing to the mean. But this can only happen if there's a normal distribution of content available. Which there isn't. Which is my whole and only point.
There's been a lot of substitutive spending
I don't think so. But agree to disagree.
But you're saying that the number of substitutional sales within that 2M is so small as to be "meaningless"?
Meaningless as in the substitutional buyers are more than made up for by the buyers who wouldn't have bought anyways.
Meaningless in the math, not meaningless as in unimportant.
Hmm. Do digital sales tend to have a long tail? You say there's lots of opportunity to buy because people spend so much more time in the on-console storefronts I didn't know that was necessarily true either, actually but I thought digital sales tended to be even more front-loaded than physical, with most digital buyers taking advantage of pre-loading, etc. I figured that's why 35% of your sales may be digital on launch day, but already down to 25% by the end of the week. So yeah, it seems like physical is getting a lot more "troll the store and see if there's anything good out"-type sales. Those who buy digitally seem kinda laser-focused, by comparison.* Is that not the case?
Couple really good points you make here. Yes, digital has a long tail but like you say ONLY when those titles are promoted. Discover-ability of catalog in digital is a huge challenge. When you go to Walmart or GameStop, you look at the shelf, and EVERYTHING is there, right? You look around, see some old game you remember wanting to play and you might pick it up.
On digital it's much more challenging because people have to seek out catalog, unless that catalog is promoted on a storefront page or through a sale.
Err, under no circumstances? Why do you say that?
There are some mental barriers for some people that if a title is digital only on the Consoles, that it somehow cannot be worth $60. Or that people want the ability to sell/trade a game once it's priced higher than $20. And far too many people are disc based buyers. To try and make a big budget, $60, AAA type game digital only in 2015 is not feasible. Perhaps in 10 years it will be.
So if per-title sales are flat, then maybe substitution is happening at roughly the previous rate of growth?
I do not think that it is fair to assume that average sales grow over time (which is why there's a very strong correlation between release count and total sales. If average sales grew over time, the correlation would be lessened).
But what I really hear you saying is that digital distribution is INCREMENTAL to the Packaged sales and growing the overall pie? Hmmm, where did I hear that before lol. Told you we agree.
That strikes me as a fuckton of additional sales far too many to be merely incremental
Incremental - Increasing or adding on. "A "fuckton" of additional sales" = Incremental sales. We're saying the same thing.
So, you say there's not a meaningful number of "switchers" within that 25%. Is that correct?
Not at all. They are meaningful. But I'm saying more of those are additive to the pie than substitutive.
Oh, so you don't think we'll be at 40% digital in 3-4 years? Will we ever be? Do you also dispute the 20% digital figure?
I do not think 40% will be achieved this cycle. As for the future, it depends on what offerings are made for the next gen and what consumer choose. I do not dispute the 20%.
Well, sure. A physical release still gives your product a lot of additional exposure, so if your game turns out to be a hit, gambling on a physical release at launch can really be a windfall. On the other hand, if like most games, yours only turns out to be a moderate success, the additional costs and lower margins of a physical launch can more easily break you.
Ehhh, if you have a bad game, nothing will save you. The development costs absolutely dwarf packaged distribution costs. If you're going to lose money, you're going to lose money regardless of a packaged version.
A physical release might be a big win, but it's guaranteed to be a big risk.
I think you might be overstating the costs of Packaged distribution by a significant factor.
Because whatever the risks to their business that decision may involve, the potential payout will always be higher if you add a physical release?
Kind of. The addressable audience is certainly bigger when doing a Packaged release. You also get more press coverage and only with a disc will a portion of the game buying audience consider your game to be a "real game". Best you can do is tailor your offerings to multiple consumer segments.