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Space for Rent: Popping the Industry Bubble


Tweet of the Day: The Great Gamer Migration of 2016

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In recent days I’ve noticed a division regarding the announcement of the Xbox One. On one side you have the industry insiders, those whose profit margins depend on staying on the good graces of the big players of the industry blithely dismissing consumer concerns over the new machine. On the other you have consumer and critics warning Microsoft that they are heading in the wrong direction. The attitude of the defenders is that these changes are not only the wave of the future but necessary and that the detractors are simply blowing this out of proportion.  Case in point, the latest Rooster Teeth podcast discussed the Xbox One reveal and dismissed the uproar by comparing it to Apple’s roll out of such products as the iPod or the iPhone.

However, what they failed to mention was that what really sold the iPod was not the the hardware but  iTunes. iTunes offered an easy to use music player that worked in with Macs and PCs, allowed you to convert your existing music library and created an alternative sales scheme to the bloated music industry standard. At a time when consumers were fed up with overpriced music CDs, Apple offered users to buy music à la carte, listen to online radio and added podcasts, video cast and digital video downloads, all in a convenient package. It offered consumer friendly alternative to the very unfriendly music industry take or leave it attitude.

Apple also offers a warning about what happens when you give in into monopolistic tendencies. When the iPhone came out, it offered an app store but they became extremely stingy with their publishing requirements. Throw in the fact that the first iPhones only worked with AT&T (a descendant of Old Ma’Bell with the same monopolistic attitude) and that opened the way for the competition (Samsung/Google) to bust the smart phone market wide open. Apple is still in the game, but they are no longer the leader in that market or in the similar tablet market.

Digital distribution may be the wave of the future, but why is it being shoved down the consumers throats? If Microsoft wants users to employ their cloud services, why are they forcing them on everyone instead of sticking to the current optional model? If  used sales are such a drag on the industry, why entice consumers through competitive pricing online? After all, Amazon, Apple, Steam and Good Old Games have proven time and time again that if you offer better deals, the costumers will flock to your sites. Why front load your product with features nobody asked for and have nothing to do with the core function of said product instead of allowing for those things to grow organically from consumer use?

And above all else, why the crummy dismissive attitude toward your consumers?

I think I know the answer. Behind the smug assurances that this is the wave of the future, you can hear whimpering in the background driven by a singular fear: the profit margins are shrinking.

But why?

Every time the question is asked, the industry, and those inside who breath in the air within its bubble, trot out a whole herd of scapegoats composed mostly of used games and digital pirates.  But I believe that the answer is far simpler, the industry is drunk on its own success. They become accustomed to every single release to become a sales record holder just because a few games have set records in all out of proportion to their actual quality. And those who rely on the industry good graces are not inclined to disabused them of that misguided vision.  So the divide remains to short term detriment of the consumer but the long term peril for the industry because the moment someone capitalizes on their arrogance they will fall from grace. However, a ray of hope remains.  Just ask Good Old Games Managing Director:

Mostly, however, Rambourg thinks the company’s success boils down to something simple: customer service.

“We treat our gamers like humans,” he says, “not criminals—and I think this is why our community is so active and faithful.”

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