Kotaku: Economics

Analyst Pegs Team Fortress 2 Hat Economy at $50 Million

Owen Good — Sat, 17 Dec 2011 15:00:00 EST

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Done with that Zynga story? Thought that was all the economics you were getting today? Nope. While he's not recommending investor action, writer Paul Manwaring did some number crunching and conservatively valued Team Fortress 2's unique items economy at, oh, about $50 million. More »

Portable 3DS News Jump Starts Nintendo Cottage Industry

Brian Crecente — Wed, 24 Mar 2010 18:00:00 EDT

Nintendo isn't the only company seeing a jump in value after announcing that they plan to release a 3D version of their popular DS portable console. More »

Why Economists Love Video Games

Mike Fahey — Tue, 23 Mar 2010 13:00:00 EDT

The billion dollar business of selling virtual goods in free-to-play games is more than just a financial windfall for companies like Playfish. A controlled economy with millions of active participants gives economists an entirely new way to model consumer behavior. More »

Tekken 6 Ships (Not Sells) 2.5 Million Copies

AJ Glasser — Mon, 02 Nov 2009 04:00:00 EST

While a bird in the hand is worth more than 2.5 million copies shipped worldwide, Tekken 6 is nothing to sneer at. Wait, that came out wrong... More »

Bayonetta PS3 Outsells Bayonetta 360 — No Surprise There

AJ Glasser — Mon, 02 Nov 2009 03:00:00 EST

Unofficial day-one sales are in for Bayonetta and boy does Japan love its PlayStation 3s. Ninety-three thousand copies sold for Sony's home console compared to the 45,000 sold on Xbox 360. More »

Guitar Hero, Madden, Eliminate Play The Monetization Game

AJ Glasser — Mon, 19 Oct 2009 02:30:00 EDT

Kai Huang, Peter Moore and Neil Young forecast a grim future for physical media at the University of California at Berkeley's PLAY Conference this past weekend. More »

EA Stock Soars On Microsoft Buyout Rumors

Mike Fahey — Wed, 23 Sep 2009 17:40:00 EDT

Rumors can be powerful forces in the economy, as evidenced by an 8.1 percent rise in Electronic Arts stock today following unsubstantiated rumors that Microsoft was interested in buying the publisher out. More »

MIGS Keynote: A Broken Business Model

Maggie Greene — Sat, 22 Nov 2008 16:30:00 EST

The Montreal International Game Summit recently wrapped up, and keynote speaker David Braben of Frontier Development really took the industry to task on everything from the business model (broken!) to retailers (killing longevity of games!) to the 'online myth' of the next gen consoles. He makes some interesting points, though I'm not at all convinced of the veracity of some of them. Here's his take on the retail model: More »

Giant Online Revenue Falls, Still Rockin' the Chinese Market

Maggie Greene — Sat, 22 Nov 2008 13:30:00 EST

Despite declining stock value, Giant Interactive — the company behind the intriguing MMO Zhengtu Online, which is a mix of MMO, gambling, real money transactions, and gold farming — is still tearing up the Chinese market. Steve of PlayNoEvil has some interesting analysis up of some recent numbers, which have indicated the the average revenue per player has dropped to around $41 USD (RMB 282). Giant is moving to encourage 'steadier' playing, instead of simply buying up cash shop items like there's no tomorrow, so the drop was expected. Still, the money being made is pretty impressive for a domestic game (drop and all): More »

So You Wanna Be a Developer ...

Maggie Greene — Sun, 09 Nov 2008 15:30:00 EST

Dave Perry, founder of Shiny Entertainment, sat down with Valve's Gabe Newell to talk about how to shoehorn your way into the industry — and what's the industry going to look like in a few years, anyways? Are game degrees a waste of time? Is specialization going to be the name of the game, as in film ? And how can you avoid shooting yourself in the foot when trying to get said foot in the door? On specialization, Newell had this to say:

DP: Let's look several years into the future for a moment. Should I even bother learning today's skills? Surely they'll have completely changed by the time I get out of college? What kinds of jobs are absolutely 'rock-solid', and will undoubtedly still be around five to 10 years from now? And what new jobs do you think might exist that nobody has quite pinned down just yet? GN: Specialization and hierarchy are the norms in film production, and are antithetical to what needs to happen in the games industry. The reason for that distinction is that the game industry is more focused on invention than on repeatability/measurability. Programmers that can draw are going to be in much better shape than an animator specializing in putting talking mouths on cats. The solutions of tomorrow are not going to fall into the production or organizational categories of today.

It's a quick read and has some worthy tidbits if you're aiming for a development career. Valve's Gabe Newell on Becoming a Game Developer [GameCareerGuide] More »

By the Numbers: Analyzing the Global Market

Maggie Greene — Sun, 09 Nov 2008 13:30:00 EST

Gamasutra has an interesting — if dry — analysis of a variety of sales figures from Nintendo's investor presentation. While targeted towards a particular audience, the variety of graphs and pie charts illustrate what's going on in the global marketplace: handheld and console sales, as well as first- and third-party software sales, shed light on how Sony, Microsoft, and Nintendo are doing across the board. Of particular interest are the figures on the European market, which tends to be difficult to get a grasp on: More »

On the Headaches of MMO Billing Structure

Maggie Greene — Sat, 08 Nov 2008 16:30:00 EST

Gene Hoffman, CEO of Vindicia (a billing and fraud protection company), has some words of wisdom regarding the headache that is billing and payment for MMOs — be they the more 'traditional' subscription model or the free to play model. Obviously, there are benefits and downsides that come with each model, and companies are constantly trying to negotiate a balance between profit and player happiness. Even the vaunted subscription model comes with its own problems and a variety of structures within that model: More »

Hype Cycles and Dysfunction: Game Journalism

Maggie Greene — Sun, 26 Oct 2008 13:30:00 EDT

Leigh Alexander has a nice piece up on what she calls the "dysfunctional family circle of game industry, game media, and game consumer," focusing on the whys and wherefores of the 'hype cycle,' hot (sometimes misleading) headlines, and a culture of jaded consumption. There's been a lot of talk of the problems of game 'journalism' lately, but Leigh's piece is particularly well-written and reasoned. Are we dealing with a chicken or the egg question?: More »

Launder That Money: RMTs in Asian MMOs

Maggie Greene — Sat, 25 Oct 2008 14:30:00 EDT

A gold farming/money laundering ring in South Korea has been accused of moving somewhere in the neighborhood of $38 million USD from Korea to China (with the help of real money transactions). According to PlayNoEvil, they made false purchases to a Hong Kong paper company to move the money, which is what eventually led to their arrest. In addition to the ring leaders, an additional 11 people were arrested: More »

Video Games Equal Comfort In Troubled Economic TImes

Mike Fahey — Wed, 24 Sep 2008 11:20:00 EDT

Are video games the movies of our current economic slump? In an article wittily titled, "In Tough Economic Times, Video Games Console", NPR writer Laura Sydell explores the similarities between the growing popularity of video games in mainstream culture with the movie boom that occurred during The Great Depression in the 1930's, at time when a weary nation turned to nickel theaters to escape the grim realities of the economic climate. She compares the relatively steady sales of movie tickets to the ever-expanding gaming market, with software sales up 43 percent from this time last year. More »

The Massive GameStop Interview

Maggie Greene — Sun, 21 Sep 2008 14:30:00 EDT

Well, we already know what disgruntled ex-employees think of GameStop; how do the head honchos think they're doing? Christian Nutt sat down with Bob McKenzie (senior vice president of merchandising) and Tony Bartel (executive vice president of merchandise and marketing) at the yearly GameStop Expo event for managers and management to talk about GameStop, games, sales, the market .... It's a hefty piece, clocking in at eight pages, with a lot of soft peddling on tough issues, but what would you expect from marketing management types? One of the issues brought up was the value of trade-ins — or perceived value (or lack thereof): More »

Armature Founders on the 'Unsustainable' Business Model

Maggie Greene — Sun, 21 Sep 2008 13:30:00 EDT

As we mentioned earlier this week, three former members of Retro Studios (Metroid Prime) have struck out on their own and created Armature Studio. Mark Pacini, Todd Keller and Jack Mathews, three key development figures behind the Metroid franchise, chatted with Gamasutra about their reasons for creating a new studio, as well as the problems they see with the current game industry development model: More »

Challenges Versus 'Learn By Death' Frustrations

Maggie Greene — Sat, 30 Aug 2008 17:00:00 EDT

A few people have written on the 'softer, kinder' ethic found in games these days — more and more games seem to be offering less challenging/frustrating mechanics so that players can actually complete them. I think a lot of this discussion does center around different play styles — after a long day of banging my head against the walls of the Ivory Tower, I don't want to come home to bang my head against the gaming wall — so I always read these essays with a critical eye. But regardless of what I (or anyone) personally like to play, it does seem like the era of extraordinarily frustrating games has passed, at least for AAA titles: More »

The Dao of Game Design: Know Thy Player

Maggie Greene — Sat, 23 Aug 2008 13:40:00 EDT

Compared to a lot of esoteric ruminations on game design, Ernest Adams' little essay on 'the dao of game design' is remarkably grounded and to the point. The question of how to make a game that players — not just the designer — would want to play is an obvious one; perhaps more obvious is the fact that a designer needs to know what they're trying to convey (though, considering the muddled end products we're sometimes presented with, perhaps some designers don't pay enough attention to the 'message'): More »

China's Gaming Market Going Up, Up, Up

Maggie Greene — Sat, 16 Aug 2008 13:30:00 EDT

In totally unsurprising news, China's game market continues to climb — numbers just posted for the second quarter of 2008 show an 11.2% increase over first quarter, and a nearly 66% increase from the same quarter last year (!). In terms of market share, Shanda leads the pack with a 17.9% share, with other big companies hovering below that. More »

The Wide World of Gaming: 'The End of Gamers'

Maggie Greene — Sun, 27 Jul 2008 14:30:00 EDT

Ian Bogost has an interesting editorial over at Edge Online entitled 'The End of Gamers,' a title which he admits doesn't really capture the main argument: "["The End of Gamers"] is lurid but might not capture the main argument of the piece, which is more like "Things People Do with Games." Much of his point is that other media has a wide variety of applications, and isn't shoehorned into a few limited types of uses ('entertainment' vs. 'serious' and so on). Bogost isn't arguing for 'games as art' or 'games as useful' or anything else, just pointing out that some perceptions about the industry start to break down when one considers the wide range of applications current games can have: More »

Going For the Mass Market: Good News or Bad?

Maggie Greene — Sat, 19 Jul 2008 17:30:00 EDT

I've read a number of thought-provoking pieces over at Only a Game, and this week Chris Bateman has a meditation up on Nintendo, the 'mass market,' moving away from games, and what this could spell for the industry at large. Is it really all it's cracked up to be? Unlike most of my favorite essays from Bateman, this one is pretty short and digestible — he points out that aggressively pursuing the 'mass market' (casual market) is working out splendidly for Nintendo, but he wonders if aggressively targeting that market inherently means moving away from games. And what about the industry at large? Well, that's not so clear: More »

Predictions on the Future of Gaming

Maggie Greene — Sat, 12 Jul 2008 16:30:00 EDT

Over at the Escapist, they're taking a look at the future of gaming — Hal Halpin, president of the Entertainment Consumers Association, looks at a number of 'maybe, maybe not' predictions with his own take. Ranging from the mundane ('Game prices will go down!') to the political ('Things will get better once gamers become politicians!') to the industry-focused ('Publishing structure is stuck in a rut and won't change!'). It's a fun read with some good points on the present and future directions of the gaming industry. On the publishing structure, Halpin has this to say: More »

From the Margins to the Mainland: the Future of Virtual Worlds?

Maggie Greene — Sat, 05 Jul 2008 12:00:00 EDT

Those concerned with 'virtual worlds' — as opposed to 'games' — spend a lot of time contemplating the role of virtual worlds in a wider market; over at Terra Nova, Bruce Damer looks at the potential future of virtual worlds, which could be a lot bigger than most people imagine. Some potential answers to keep the industry growing? Piggybacking off platforms that are currently growing at a rapid clip, making sure virtual worlds are 'worth' something — perhaps some as of yet undiscovered little platform will be the key: More »

MMO Business Models: Subscriptions vs. Free To Play

Maggie Greene — Sat, 07 Jun 2008 16:30:00 EDT

Gamasutra has an interesting look up at the MMO free to play/micro-transaction vs. traditional subscription model up - talking with SOE's John Smedley, Three Rings' Daniel James and EA Mythic's Mark Jacobs. Unsurprisingly, there are differences in opinion on the utility of the micro-transaction model, with some participants in the discussion coming down on the side of the traditional subscription model: More »

90% of Virtual Worlds Will Fail Within 18 Months

Maggie Greene — Sat, 17 May 2008 18:30:00 EDT

For those that lament the plethora of crappy MMOs and poorly-planned 'virtual worlds' of various stripes — fear not, a new report indicates that 90% are doomed to failure within a year and a half. Gartner, the research and advisory firm that produced the report, notes that the high rate of failure could be due to a number of factors; perhaps most importantly, the low cost of entry means that more experimentation is taking place (and like any experiment, a lot of virtual experiments fail). But it's not all doom and gloom: More »

Ian Bogost on Advertising in Games

Maggie Greene — Sun, 04 May 2008 18:30:00 EDT

Ok, so a billboard in a driving game may make sense — but what about games where it doesn't make sense? As Ian Bogost points out, "Would an orc order pizza? Does a dystopian planet from the future need a pacer drink?": More »

Designing the Single Player Economy

Maggie Greene — Sat, 03 May 2008 13:30:00 EDT

Economic issues in MMOs and virtual worlds get a ton of attention, but less attention is paid to the 'single player economies.' Richard Knight argues they're no less important — while a bad economic setup won't ruin an otherwise good game, it can put a damper on the proceedings. I can certainly think of a few games that had economic setups that were mind-bogglingly bad in a number of respects: More »

Disney's Virtual Magic Kingdom Closing, Fans Hysterical

Maggie Greene — Sun, 20 Apr 2008 15:30:00 EDT

Once upon a time, Disney had this virtual world called (creatively enough) Virtual Magic Kingdom: More »

Who's Winning the Gold Farming War?

Maggie Greene — Sat, 19 Apr 2008 14:30:00 EDT

Steve at PlayNoEvil has some interesting analysis up on the current state of gold farming in MMORPGs (though he does admit that since hard stats are difficult to come by, "any analysis is more akin to reading tea leaves"); using data provided by mmobux, he looks at the pricing trends to try and divine what might be going on in the wild world of selling gold: More »

The UK Declares War On Canadian Game Industry

Maggie Greene — Sun, 30 Mar 2008 15:00:00 EDT

We mentioned potential action to be taken by a European trade group against Canada for unfair trade practices, and now the UK Ministry of Canadian Ministry of Culture, Media and Sport has launched a formal investigation. The British government is afraid that Canadian "state aid offered to computer games companies ... may not be compatible with World Trade Organization principles." With a bevy of tax benefits (with some allowing companies to write off as much as 45% of labor costs), Canada has been luring big development studios away from Europe: More »

Chinese Game Market Grew to $1.66 Billion In '07

Maggie Greene — Sat, 22 Mar 2008 16:00:54 EDT

Pearl Research has released their latest report and forecast on China's market and has come up with some pretty astonishing numbers. A quick rundown: the market grew 60% in '07, reaching $1.66 billion; they predict the market will exceed $3 billion by 2010; domestic games are getting as many as 1.66 million concurrent users. It's no secret the market is huge in China and continues to grow, but those are some pretty impressive numbers (and a lot of zeros). The full press release, with some extra details, is after the jump: More »

Human and Property Rights in Virtual Worlds

Maggie Greene — Sat, 15 Mar 2008 16:30:13 EDT

SXSW hosted what sounds like a very interesting panel on the issue of personal property rights in virtual worlds: this is becoming an ever more important issue, with lawsuits a-flyin' and people getting arrested for virtual property theft. So, how is this issue going to get nailed down? And when? And by whom? The panel consisted of GoPets CEO Erik Bethke, Live Gamer co-founder Andrew Schneider and attorney Greg Boyd, with Charles River Ventures' Susan Wu moderating. More »

'The Power of Free to Play'

Maggie Greene — Sun, 02 Mar 2008 12:30:18 EST

Adrian Crook had an interesting presentation at the GDC Worlds In Motion Summit on the issue of free to play games - where they've been, where they're heading, good things, bad things .... He's put up the slides and speech over at his website, and while the narrative redux is apparently not as zippy as the original presentation, it is an interesting listen. More »

'World of Answercraft'? Amazon.com's Askville

Maggie Greene — Sat, 05 Jan 2008 17:30:00 EST

There's an interesting piece over at Terra Nova on Amazon.com's Askville, an online question and answer forum with a slight twist - you gain experience points and quest gold! For what purpose? Good question - the author tackles the purpose and ramifications of this sort of virtual incentive system with a lengthy essay and plenty of links that I spent a while clicking my way through. More »

Game Developers Rolling in the Lucre

Brian Crecente — Tue, 27 Nov 2007 20:00:06 EST

The U.S. computer and video game industry's annual growth rate from 2003 to 2006 outpaced the US. economy's growth by 13 percent, according to a new study released today by the Entertainment Software Association. More »

'Metanomics' - A New Series on the Metaverse and ... Stuff

Maggie Greene — Sun, 16 Sep 2007 17:00:58 EDT

If you're interested in the issues surrounding the metaverse (especially in terms of economics and policy), Metaversed is pairing up with the Cornell Johnson School of Management to offer a series of speakers and a website to discuss issues within the metaverse: economics, law, policy, technology .... Robert Bloomfield explains the goal and scope of the series over at Terra Nova: More »

Call For Papers: Economies and Virtual Worlds

Maggie Greene — Sun, 12 Aug 2007 14:30:19 EDT

In case any Kotakuites out there have a great paper floating around on virtual worlds, the Journal of Electronic Commerce Research (JECR) has put out a call for papers. Scheduled for publication in August 2008, the special issue will focus on (as the journal title would imply) commerce, but the catch is that the issue will be focused on virtual worlds. While this journal is centered on e-commerce anyways, I'm still curious to see what sort of academic papers crawl out of the woodwork. The divide between mainstream 'we play games' ideas on games and academic 'we study games' ideas on games is occasionally astonishing for both how far apart those two worlds can be and how close together they sometimes are. I'm not in a field that deals with this sort of stuff, but I'll be keeping an eye out for the issue next August. Full details after the jump. More »

'Analyzing the Analysts': Thoughts on the Wii

Maggie Greene — Sun, 08 Jul 2007 18:00:58 EDT

Games * Design * Art * Culture has some thoughts up on remarks by analysts and their real world validity. Not being prone to getting out scratch pads of paper and theorizing on topics I am ill-equipped to deal with, I'm not sure if the analysis of the analysis is valid, but it's a reminder that quoting experts is fun, but not always an accurate prediction of what is to come. In this case, the topic is an analyst "saying publishers will flock to the Wii because of 'favorable economics'"; the argument here is that it's not 'favorable economics,' but sheer numbers of users that will determine the success of the Wii over the long term. More »

Clip: Real Estate Roller Coaster

Brian Crecente — Wed, 04 Apr 2007 20:00:06 EDT

Boing Boing points to this amazing use of RollerCoaster Tycoon to chart the price of homes in the U.S. from 1890 to present day. Now someone needs to make one charting the stock market, but quick! Brian Crecente More »