"I think reports on the death of package goods have been greatly exaggerated," Feder told a gathering of analysts in New York earlier today. "Downloadable content is interesting and will continue to be interesting, not because it's eclipsing retail but because of the instant feedback.

"You can learn as you go along" from customers.

Feder said that while he thinks that downloadable content will continue to increase, it won't be at the expense of retail goods or retail stores.

"I'm bullish on downloadable content but not necessarily at the experense of retail stores and packaged goods," he said. "I think package goods are here with us for a long time. I am pretty confident we will be seeing package goods and stores for a long time."

Marcin Kawa, executive producer on the game, describes Last Flight as an action-adventure game similar to Golden Axe but with a bit of dark humor. The game has players take on the role of Larry Adelman, a chubby culinary critic stuck on a flight with a vampire that starts to infect other passengers.

To play Last Flight, gamers need to swing the remote or nunchuk to perform attacks. The game will include combos and final blows as well, Kawa said.

While the developers declined to say how much the game, due out later this year, will cost, Kawa said that they broke the title into four episodes to make it as affordable as possible.

The Lost and Damned expansion pack will include new music along with the hours of new play, AP reports. Among the artists signed up to include songs are Busta Rhymes and Funkmaster Flex.

In fact Rhymes is debuting a new song, Conglomerate, in the episode.

"It kind of shows the reach of video games to influence people to buy music," said music supervisor Ivan Pavlovich. "That's why it's important for people like Busta, when they have new material. He is pushing an album in this. ... That's part of the whole thing that we do that's really important to us, is turning people on to new music. "

New episode of `Grand Theft Auto' adds new music

Once inside I wait for the Rockstar folks to collect me at the front desk. They lead me back to the driveway and through a tall wooden gate which opens to a steep set of meandering cement stairs that cut through tall bushes, grass and towering walls of living bamboo.

Finally, we come to a clearing, a small yard and a long bungalow with a front made nearly entirely of glass doors. Inside is a small living room, a television, a couple of Xbox 360s and controllers.

But before dropping into the game and the play session I've read about on half a dozen other sites, I decide to quiz Jeronimo Barrera, Rockstar Games Vice President of Product Development, about episodic gaming and the nature of video games.

I float my theory of big games to Barrera. Call of Duty 4 was such an enjoyable experience, I tell him, because it was a game that, in theory, could be enjoyed in one sitting. It was designed to be experienced like a movie, without breaks, I think. But what about longer games that can't be enjoyed in one go, what about games that, like GTA, could take weeks or months to play through? I think, I tell Barrera, that they should almost be designed like novels, rather than like books.

"Or like a soap opera," he says, seeming to agree with me.

"In terms of story telling, (Grand Theft Auto IV) is incredibly compelling," he says. "Niko is a strong character."

But the Rockstar folks still know that when it comes down to it, Grand Theft Auto isn't as much about the story as it is the experience.

"In games like Metroid Prime if you lose your concentration, what's happening in the game you can't get back into it again.In the case of this game you are jumping into a world not necessarily a storyline."

Barrera says he sees the gaming industry going in two distinctly opposite directions: One direction includes games like Call of Duty 4's campaign that deliver a single play-through experience which is almost movie-like in its delivery. The other includes games like Grand Theft Auto which delivers more of a platform for experiences, rather than just a game.

Intrigued, I ask Barrera about Grand Theft Auto IV's episodic content. Why can't Rockstar use GTA as a platform, I ask. Why bother coming up with another GTA for this generation of consoles, couldn't the developer just create episodes for the game and live off that?

"We are calling the downloadable content (coming to the Xbox 360) episodes," he said.

But it's "an experiment" they're quick to add. Right now Rockstar doesn't seem sure that there are enough users with access to online content on the 360 to make it worthwhile for them to continue pumping out episodes.

I wrote up a feature for the Rocky earlier this month on the latest installment of Madde. It was mostly a guide to what's new in the latest versions and how the developer continues to squeeze some semblance of originality out of an 18-year-old franchise. 18! So Madden is actual legal. Isn't that shocking?

Annnnnyway, I did manage to throw the games producer, David Ortiz, off his game for a second when I suggested that maybe it's time for Electronic Arts to turn Madden into an episodic game. They could just keep a general build available on shelves for people who don't own the game and then every year sell a huge downloadable pack that adds in a bit of gameplay and new elements for the franchise. Every three to five years they could sell a new in-store version with a different engine or major overhaul. It's essentially what EA seems to be doing already, but for the full price.

Ortiz wasn't exactly clear with his answer to the question.

"That's something we may explore in the future . . . or maybe we won't," he said. "What's important to us is having enough time to deliver something relevant to our fan base. Right now we tie in nicely with the football season. It kinda works out nice. In addition, it gives us enough time to devote to coming up with these innovative ideas."

So I guess $60 a pop retail games win out over $20 to $30 episodic versions every time.

Power game [Rocky Mountain News]

A set of Playstation Portable rumors rumbled our way this week. Both of them sound very possible and, if true, could give PSP owners a bit of a light at the end of the tunnel.

Rumor #1: God of War developer and hellofaniceguy David Jaffe's secret Playstation Portable project will feature episodic content and require a hard drive to play. (Some put each episode at close to 700 Megs)

I ran this by some of my inside sources and true or not, the rumor is certainly making the rounds. Several developer pals have heard about this and the possibility of a fabled hard drive for the PSP, but Sony won't comment either way.

If Jaffe has his heart set on getting his PSP game to make people cry, I think episodic content could certainly be the way to go. Using smaller episodes instead to deliver a game could allow you to structure it more like a book and slowly build up a gamer's emotional connection with the characters. It would also allow you to react to gamers' reaction to your game and thus make it more evocative.

Of course, you really wouldn't need a hard drive to do any of that, just a sizeable memory stick.

Brian's Guess: Yes on episodic content, no on hard drive, at least not as an add-on.

Rumor #2: The Playstation 3 will allow you to stream music and video to your Playstation Portable via a WiFi connection.

This one comes via an insider. The story goes that Sony executives held secret behind closed door meetings with developers to tell them about all of the cool things that the Playstation Portable and PS3 will be able to do together.
In one of the meetings execs said that Playstation 3 would let you placeshift your video and music to your Playstation Portable anywhere you had a WiFi connection.

I asked around and while everyone seems to think that it makes sense, no one has heard official word. Sony declined to comment.

This one is weird. Back at last year's E3 Sony announced that the PS3 would be able to stream multimedia content. Then the PSP got a patch with LocationFree TV support. In December the PSM folks said they talked to developers who said that streaming to a PSP would be done through LocationFree TV. Makes all kinds of sense. But then E3 rolls around this year and despite having very little to announce at their press conference to make people happy, the execs don't say a word about free video and music streaming to your PSP. What gives?

I suspect that this is going to be the big news hitting sometime between now and the Tokyo Game Show.

Brian's Guess: Yes, eventually.

Here's the very interesting thing. If both sets of rumors are true, it could point to a new Playstation Portable. If Sony really were going to announce a hard drive for the PSP wouldn't they just put it in the new model and if a new model is coming out, why not just announce the video and music streaming then. Brian Crecente

Have any rumors you'd like to share anonymously? Send me a tip at editor@kotaku.com.

Never-ending sports franchise Madden hits stores on August 22 to sate America's insatiable thirst for all things football. This time around EA, king of multi-SKUs, is releasing a Hall of Fame edition for both the Playstation 2 and the Xbox 360.

The PS2 edition will include:

PlayStation 3 Unveiled—G4TV provides a sneak peek at the making of Madden NFL 07 for PlayStation 3 with exclusive gameplay footage, content previews, and more.
Hall of Famer: John Madden—A career retrospective highlighting Coach Madden's days as Oakland Raiders head coach and award-winning calls from the broadcast booth.
Inside Madden Studios—ESPN's Trey Wingo delivers game production insights and exclusive interviews with the team behind the game.
Exclusive Music Interviews—The hottest acts featured in Madden NFL 07 reveal the inspiration behind their music.

While the 360 version will come packed with:

Hall of Famer: John Madden—A career retrospective highlighting Coach Madden's days as Oakland Raiders head coach and award-winning calls from the broadcast booth.
Madden Nation, Season One—Heroes are born and dreams are shattered in the eight-part mini-series. Revisit the complete first season of the original ESPN program.
Inside Madden Studios—ESPN's Trey Wingo delivers game production insights and exclusive interviews with the team behind the game.
Exclusive Music Interviews—The hottest acts featured in Madden NFL 07 reveal the inspiration behind their music.

The PS2 will sell for about $60 while the 360 version will sell for about $70.

Madden is on its seventeenth iteration... seventeenth. Isn't that insane? Is it just me or does it feel like EA and Madden have pretty much squeezed every bit of technical and gameplay nuance possible out of this concept? I wonder if gameplay mechanics can suffer from the Uncanny Valley? Maybe Electronic Arts should stop churning out entirely new versions of the game and turn the franchise into something built around episodic content or packs. Brian Crecente

At the recent Develop Conference in Brighton England, Epic Games VP Mark Rein foamed at the mouth about episodic content, then leaped over the podium, ripped Gabe Newell's still beating heart out of his chest, consumed it, then let out a primal scream while staring unblinking into the sun.

"I've heard a lot of insane talk about episodic content. Very little of it makes any actual sense. It's a broken business... Customers are supposed to buy half a game for $20, then wait six months for an episode? When I put a game down, I want to try a new one. Episodic games that offer faster turnaround will inevitably be using a lot of recycled content, walking through the same environments and shooting the same enemies with the same weapons.

He was met by the audience by derisive jeering. "Mark, you are a dinosaur, you are wrong!" screamed one not-very-clever attendee. Mark Rein then pulled out a flak gun, placed it to the temple of said delegate, and opening — his eyes as wide as they could go — kept on pulling the trigger until he was out of rounds. Florian Eckhardt

Rein Pours Scorn on Episodic Content [Next Generation]

As uncomfortable as it makes many gamers, opening up the computer games platform to big corporates as a way to get eyeballs on brands can be a very lucrative trade-off for developers. Digital luddites argue including billboards or product sponsors into virtual environments breaks the immersive quality of gameplay - and certainly this is true if the advertising is implemented in an obtrusive or nonsensical way - but those thousands of dollars could provide a cushion for an ailing developer and may be a lifeline for a future, more innovative project. Immersion could even be increased, as appropriate advertising may enhance the agency of the player.

We think most gamers are amenable to in-game advertisements but they expect advertisements to make game prices go down. Most other advertising-financed media is either free (for example, Kotaku) or extremely inexpensive in comparison to the $50 or $60 expense of a game. Keeping game prices the same and then making additional money by subjecting us to ads during our escapist gaming sessions feels somehow like an insult.

A great example of an otherwise excellent game company that squandered a lot of good will by doing this is Irrational. They released SWAT 4 at full price then patched in-game advertising in. Gamers who might otherwise have felt strongly enough against in game advertisements to boycott the game therefore couldn't do it. It was a cheap, cynical and shady move from an otherwise great dev house.

What do you guys think?

Alternative funding models Part 1 [Guardian Gamesblog]

Eurogamer reports that Half-Life 2: Episode 1 won't actually need HL2 to play. Valve is hoping to get four to six hours of single player content out of Episode 1 for $19.99 with a similar pricing structure for the already-along-in development Episode 2.

Half-Life 2 Will Not Be Required to Run Episode 1 [Eurogamer]

Even though the masses are still waiting on the first installment of Valve's Half-Life 2 episodes, Robin Walker told Computer and Video Games that the second episode had been in development "for some time." Maybe the first episode didn't end up as long as Valve had hoped so they started on a second episode? Or maybe they see just how forward thinking episodic content done right could be for the industry (not to mention an easy way to make tons of money via Steam).

Valve Confirms HL2 Episode 2 [Computer and Video Games]

Pricing for Half-Life 2 [Amazon]

Remember Half-Life 2: Aftermath? The expansion pack of sorts that picks up where HL2 left off? Well, start calling it Half-Life 2: Episode One! Wait. Episode One? But isn't this the second part of the second part of the Half-Life story, and wasn't Lost Coast already released as a new level? I'm so confused! Even more confusing is what will actually be released on April 24th. V-man Doug Lombardi says Ep. 1 will be indicative of the "beginning of a regular flow of content" from the company. Cue holding of breath.

I'm sure I'll have plenty of time to sort out this titular mess before Episode One shifts... I mean ships!

(Now I'll rant a bit: Oh, Valve. I love you so much, but why do you do any press at all? Can't you just keep your fool mouths shut until, say, 2 weeks before your products ship? Seriously, when the gold master goes to the factory, or the final FINAL release version is being FTPed to every Steam content server, just be silent.)

Half-Life 2 Goes Episodic [Gamespot]

Next Generation talks with Kevin Bruner, CTO of Telltale, on the company's outlook for distributing episodic content and digital distribution. Telltale, the company behind Grim Fandango and Monkey Island, is using a distribution model that circumvents publishers and gets products into the consumers hands quickly. "The old adventure games [we used to do at Lucas] we look at as feature film production. What we're doing here is more television studio-like," Bruner said. Episodic content that retains the adventure game-style of their previous work, I'm interested.

The Return of Storied Adventures [Next Generation]