Warning Warner

Between my family's yearly spring break vacation (skiing at Tahoe) and catching up after the trip, it's been tough to find time to write an entry here, so just a quick one for now while longer articles continue to brew while I find the time.

I just got my copy of MCV, an industry weekly written in the UK. (Strangely, in the much bigger US market, I'm not aware of an trade weekly.) The lead story for the March 5th issue is headlined, "Warner draws its sword." It's about Warner's new games division, and how it plans to successfully produce games. What we have here is another mega media monster peering hungrily at the games market. Even though many multi-media studios like Universal, 20th Century Fox & Dreamworks, have come before, this one is more interesting for two reasons:

[1] Warner has been here before. In fact they were the first major media studio to recognize the growing importance of the game industry. In 1976 they paid $28 million for one of the industry's crown jewels: Atari. It should have been easy to predict failure, though, because rarely do company mergers succeed, unless they involved two very similar businesses. When two unique businesses merge, management focus strains, budgets compete, strategies conflict, and the overall company suffers. (And yet, not having learned this lesson, Warner later merged with AOL, which was an obvious blunder from day one.)

Well, looks like Warner has a short memory and wants to give it another shot. The end result will be no different, despite point number two...

[2] Warner hired an honest-to-goodness developer to run the show. Jason Hall founded, and was CEO of Monolith Productions (Blood, No One Lives Forever, Tron 2.0) for several years. I've known him almost the entire time and I know he's smart, and he's a true gamer -- how many execs can you say that about? Warner did the right thing by hiring Jason, but still, it won't be enough.

The two insurmountable problems Warner faces:

o Focused publishers will always lead us in making the best games. EA, Activision, Take-Two (a.k.a. Rockstar), THQ, Konomi, Capcom, Nintendo, etc. are our future. The reason specialized companies will lead us is that they have everything to lose by failing. We rarely see an non-industry specialist, like Warner, succeed in the games industry, because if they fail in the games industry, they still succeed in their primary industries (movies and TV). It's just not as important for a company like Warner to really try hard in a area that, in the end, doesn't mean life or death to their company.

o Mega-media companies like Warner rely too much on their non-interactive born IP. In the MCV article, for example, there's a sidebar box that lists Warner Bros' stable of "impressive" franchises. See if you think these have hit potential as games: Eight Legged Freaks, Ocean's 11, The Last Samurai, Troy, Friends, ER, and Smallville? My opinion is that you can make 100 games with these IPs, and maybe five will be hits. If you're lucky.

Other Warner brands include Batman, Superman, Terminator, and The Matrix. All of these have been made as games, and with generally dismal results. Enter the Matrix was the most successful of these, despite the game being strongly panned by critics. Yet it sold well because it was released at the same time as the super-anticipated second movie, a tactic that can save a horrible game.

Jason says he knows the track-record of previous media studios turned game developer, and has ideas on how to fix the problems. But, I think the inherent problems are beyond repair. Jason also plans to create original brands within Warner, which I think is the best approach to succeed, but I doubt Warner will give him much of a chance, because it only takes 2-3 non-hits to become highly risk-adverse to making original games.

Most of us remember when LucasArts used to make original games, but all they do nowadays is make Star Wars and Indiana Jones games. Like Warner, LucasArts has a company focus problem, being part of a much larger company. In fact, LucasArts now outsources most of their projects, letting specialized companies handle development. But they've all but given up on original brands.

Warner will give up, too. And I bet they eventually regret their second attempt to play in our industry.

Comments

[Brian S.]

The main problem is that Warner sees games as an extention of its studio-created IP. The games produced may have high budgets, may look fancy, but in actuality they are shovelware. If they devoted the same resources invested in finding and nurturing their movies and tv shows then great games may developed. I am not talking aout resource size, but commitment and skill in procuring talent.

[Justin Quimby]

Are there any examples that you know of in other creative industries in which outside companies have managed to move in and achieve continuing success? Perhaps the book industry?

Justin

[Matthew Gallant]

Right now, Jason Hall is hoping that he fails as badly as Scott said the Xbox would. :)

[Jay Woodward]

Matthew --

Scott would *still* say the XBox is failing badly.

In the comments section to the previous entry (on Nokia and the N-Gage) Scott said, "The Xbox has lost MSoft well over a billion bucks, and even if the Xbox 2 does three times as well, it'll be hard to make that up."

Personally, I'm pretty sure Microsoft doesn't see it as a failure; they see it as one step backward along one axis (financial, of course) in order to move two steps forward along another (mindshare; psychological living-room presence, etc.).

Then again, maybe that's not the way they think in Redmond; maybe they really did expect it to be profitable right away. I'm sure they wouldn't have objected if that's how it had turned out. But if things weren't within acceptable parameters for their plans, they wouldn't be proceeding with phase 2.

[Goran G.]

I dunno, it's easy to say they'll fail in the face of history, but...

Take 2 for example have GTA and that's really it. Midnight Club and Max Payne are two sucessful franchises in their own right, one would say, but not really a patch on GTA in terms of money earned or fame.

Warners only needs to have their own GTA. I'm not saying that in a literal sense, I mean they only need to develop a single sucessful IP independent of film IP's and they're set. All Jason Hall need do now is make an awesome game :)

[Factory]

JQ:
Sony, in regards with the music industry. Nintendo was a card making company, iirc, before they became an arcade company (although the original company was quite small).

[Anon]

Well at least Warner will be making games from their investments in their IP. For example, if I had the DUKE NUKEM license, I would make a game with it. Seems like it would be perfect for a game... oh wait, wasn't it a game once?

[Chris Smith]

Where is Duke Nukem forever? Are you really qualified to talk about 'the industry'?

[Pip Stuart]

Where is your shipped epic game? Are you really qualified to question someone in 'the industry'?

[Brian G]

Chris, Scott Miller has been in this industry for around 20 years. Trust me when I say he knows what the hell he's talking about.

[Scott Miller]

While I don't mind the Duke jabs at all, they do clutter the board with unnecessary troll noise, so they will be removed in the future.

Besides, aren't we past these simple-minded pokes by now? Or do some people still think they're being clever, or perhaps hurting our wittle feelings at 3DR?

Save it for Slashdot.

[Sofa]

Ouch Scott! Now you've gone and made fun of Slashdot! That's actually all good, I suppose, just so long as you don't bring 3DR's own forum into it ;)

Now, I can't speak as a standard consumer or as a member of the industry, but I can certainly relate to the "professional" or "hardcore" gamer demographic, and this entry by Warner actually bugs me. They are going to ramp up a marketing machine that will splash their [most likely crap] games all over the internet and TV while taking hype and mass market interest away from the games that actually take the risks associated with innovation, unique IP, and expanding the general envelope of game design. Enter the Matrix is a perfect example. Mediocre game at best, but sold because of its IP and hype. It pisses me off to know that people who bought it could have bought Tron 2.0 instead, actually enjoyed themselves, and supported a game that was 100% better in just about every regard! :)

I wish Jason the best of luck! I have a feeling he is going to need it.

Now if Pixar or Dreamworks were to enter the industry... THAT I might find interesting :)

[Jim Vessella]

I wouldn't be too quick to start knocking Jason Hall's influence at Warner. He was on the "Merging Hollywood and Games" panel at D.I.C.E. two weeks ago, and made an excellent case for himself and Warner. Jason actually sits on the top greenlight meetings, and every game that Warner considers will have to be approved by him.

Tron 2.0 is one of the very few movie based games that has been critically acclaimed and a qualified product. If Jason continues this trend with movie based products at Warner, I have confidence he can make them successful.

[60FPS]

I believe the industry has changed enough and learned enough from the past that movie / tv brands are able to be turned into quality, good selling titles now. All one has to do is look at EA to realize that every year they come out with a game based on:

Lord of the Rings
Harry Potter
James Bond

And every year these titles receive solid (not necessarily stellar, but solid) reviews with sales to match. EA just recently announced that they were going to license the Godfather brand for one of their upcoming games. I would be willing to bet that this turns into a franchise as well.

The interesting thing to note is that EA really has no brand IP of their own. Everything including Madden, NHL, NBA, etc. is licensed (ok, SSX is all theirs ;-) ). EA wants to get into movies (hence the future based LA studio and some of their recent hires), and the movie studios want to get into games.

As long as any of these companies make quality products (movies or games), I will be willing to make a purchase.

[Gestalt]

"EA really has no brand IP of their own"

The Sims? :)

[Scott Miller]

Also...

Medal of Honor
Need for Speed
Ultima

And I'm sure a few more.

BTW, 60FPS, there are about a 10 or so brands like LOTR and Bond that have what it takes to work well in the games industry (not including sports and kids licenses). Consider that this Golden 10 are all we've found from 10,000+ non-game entertainment works from the field of TV, comics, movies, plays and novels.

There's a reason that so few non-game brands work as games, and the ones that do work all have key similarities. This'll make a good future topic.

[wabut]

I think a Friends game that played like The Sims would be a monster hit.

[Apache]

If they made a game based on Friends and cloned the Sims, I bet it would sell :)

[Gestalt]

"If they made a game based on Friends and cloned the Sims, I bet it would sell"

I'd buy that for a dollar. Especially if you could do horrible things to that annoying Rachel woman. ;-) *rubs hands in glee*

I could see an epic RTS based on Troy working too, although unless such a game is already in development it would end up coming out a year or more after the movie, which would somewhat dent its impact.

But I guess that's one of the few advantages of having a movie studio and game developer under one roof - you can develop the game and the movie in tandem to some extent, and make sure the game has a decent length development cycle but still comes out at the same time as the movie (or failing that, the DVD). Most movie tie-ins are either developed in six months flat and show it, or turn up well after the film is released and sink without a trace. Or get canned when the movie flops - eg, Titan AE.

Something else to consider - if there are only 10 brands (give or take) that Scott thinks would transfer from TV or film to games, what about the other way around? Are there any games that would make good movies? And does having game developers and TV and movie producers under one roof help make this a more realistic option? Would that help them to design more games with franchise potential from the outset, or would it just end up creating wishy-washy games that were trying to be films and failing miserably on both counts?

AFAIK only Resident Evil, the first Tomb Raider and Mortal Kombat (although god knows how!) have been commercial successes amongst all the game movies that have been made. Everything else from Mario Bros and Double Dragon to Final Fantasy and House of the Dead has been a failure. And with Uwe Boll involved in half a dozen more game-to-movie conversions, including instantly recognisable names such as .. er .. Bloodrayne and Dungeon Siege, I can see that proud tradition of sucky movies continuing far into the future. ;-)

[Logo]

liscened IP in most cases seems like a waste to me.

Most of the prospective movies to video games just mirror already existing genres. I'd think a game would be a lot more memorable with it's own character and setting than a movie. When you think of Bond you think of the movies not the game and the same applies to all of the other ones. I can't think of any company that is known for it's awsome liscences game. There are a few good games a company may have that is not their IP (KotOR) but these come from already established studios.

To me it seems like all of these companies are afraid to use their already existing IP thinking customers won't like them anymore. However if they make a solid game with it then the hardcore gamers will remember these games and buy them. After that word of mouth and strong reviews should help fuel sales even more. A couple of Ips I can think of like this would be fallout and Sam & Max.

"If they made a game based on Friends and cloned the Sims, I bet it would sell :)"

I think the 8 or 9 Sims expansions taught us that you can probably shorten that to

"If they made a game and cloned the Sims, I bet it would sell :)".

[Rumpy]

lots crappy games > one good vaporware game

[Mr.DJ]

I got a little offended by Andrew Burnes from VoodooExtreme, as he has copied some of your post and apparently tries to make you look bad.

I personally don't like journalists who criticises other people, behind their backs and make an headline about it. This is not good journalism in my opinion.

Anyways, I thought you maybe wanna check it out.

just click on my name!

[NoCopy]

Damn, if EA, Activision, THQ, etc. are our gaming future, then I don’t want to be a part of it.

I agree that Warner probably won’t care too much about the industry because they have bread buttered elsewhere, but virtually all media companies (these days) rely on their “stable IP” to bring them business. Honestly, I don’t any difference in an Ocean’s Eleven game compared Battlefield Iraq, Activision’s formula quake engine shooter #21, or whatever THQ publishes. Of all the publishers you listed, I doubt one has an original property slated for release in 2004. The truth is, the state of the gaming industry has been in decline in the past few years because these publishers only care about money; and if that’s what Jason Hall and Warner concentrate on, they will succeed.

[Scott Miller]

I agree that the current big publishers are leading us to a dim future, but it's a better one than the other media giants would lead us into.

[60FPS]

Scott -

I absolutely agree that there have only been a few successful licenses thus far. However, I believe that EA is changing the model and that other publishers and studios are going to be following in their footsteps.

To perhaps oversimplify, studios have their Consumer Products divisions license out a brand to a publisher. The publisher spends a considerable amount of money in acquiring the brand. Unfortunately, the publisher then typically does not devote enough financial resources towards a solid developer to make a good game. All of the money goes into acquiring the brand, and not nearly enough money goes towards creating the product. Hence, we end up with Men In Black, Hook, ET, Superman, Batman, etc. All poor games based on solid brands (ok, all of them are solid brands except for Hook). ;-)

EA has shown that by spending the right amount of money and staying true to the brand, that success can be achieved by licensing properties from the studios. And we are going to see EA achieve this same success once again with The Godfather. EA is resurrecting a brand based on a popular movie that is about 32 years old. Obviously, EA will give this game a huge team with an above average budget. The end product should be very solid and will most likely warrant a sequel.

I agree with a lot of your comments, but I really believe that the industry is starting to evolve. EA, Activision (with Spider-man) and even Monolith (with Tron 2.0) have shown that success can be achieved with movie / tv brands. If this is the case, why wouldn't the studios want to get involved? Granted most studios have tried before in the past (Fox, Universal, Sony, etc.) but this time they need to apply the right amount focus. I believe that this is what Warner Bros. is doing by bringing Jason Hall on the inside.

I know you are busy, but I hope you will always find time to keep up with the blog. It is informative, entertaining, and sparks discussion.

[Teut Weidemann]

The timing for Warner couldnt be worse. I remember the first rush of Hollywood coming in at the same interval: shortly before the console generation dies and is being replaced.

What happens is they start PS2/XBox development and are ready to launch when both of them are dead. I wonder if they sign up for the new consoles in time. If they do it takes longer to be profitable due to the larger investments.

This fact killed all the hollywood interactive studios in the 90's. On the next console generaiton the toy industry tried the same, came at the wrong time and died (Mattel, Hasbro).

The trick is to start when the new console generation is here, not when the last made its peak.

[Jose Zagal]

"My opinion is that you can make 100 games with these IPs, and maybe five will be hits."

Isn't that above par for the industry? If you have five hits out of a hundred...you should be in the blue, right?

[Scott Miller]

Great point, Jose! ;-)

But, I bet publishers would hardly bother if they thought that it would take the production of 100 licensed games to squeeze out five hits. Also, I think that making original games (or their sequels) has at least double or triple the success ratio of licensed games.

[Gestalt]

"Of all the publishers you listed, I doubt one has an original property slated for release in 2004"

Off the top of my head, THQ is publishing STALKER, without doubt the most original looking first person shooter due this year (not to mention the prettiest). Pity about the title though. Those of us who like obscure Russian sci-fi movies will recognise the game's name and inspiration instantly, but everyone else is going to expect it to be about people lurking in the bushes outside Britney's mansion or something. ;-)

[Greg Findlay]

Although I wouldn't consider EA to be a ground breaking company, I think what they are doing will help the industry in the long run by stablizing it a bit more. Most of the time, EA produces an average title. They don't look to inovate, they just try and produce something solid that people will recognize and use methods other games have used to produce success. This will draw more people to the games industry. EA will then take a chance and publish an innovative title produced by an outside company.

By flooding the market with average games, EA is providing a standard that users will expect. This could potentially stablize the industry, provided that other companies still continue to innovate and raise that standard. Maybe game designers will then be choosing what they want to innovate rather then reinventing crap for things that already worked well. A great example of this is user interface. I would say a good 90% of games have absolutely horrible user interface for no good reason then they wanted it to be different. There is a reason why all windows applications look the same and it's not simply because it's easier to program.

[Maciej Sinilo]

Gestalt: "Stalker" title isn't so bad. I think one of the best they could come up with if they wanted to make connection to the book. "Picnic on the side road" (or whatever the English translation of Russian title may be) would be much worse anyway :-)

[Gestalt]

Yes, but how many people have heard of the film Stalker or the book it's based on? Not many, sadly, certainly in the USA and western Europe. I'm not sure how well known it is in the former Soviet states, but here in the west it's fairly obscure I think.

[Tadhg]

Sofa wrote: "Enter the Matrix is a perfect example. Mediocre game at best, but sold because of its IP and hype. It pisses me off to know that people who bought it could have bought Tron 2.0 instead, actually enjoyed themselves, and supported a game that was 100% better in just about every regard! :)"

Well it isn't hard to be better 100% than Enter the Matrix, in fairness. But Tron 2.0 is *rubbish*, and I'll fight anyone who says otherwise in the alley behind OMalley's bar. Rubbish.

[Scott Sutherland]

I feel that Warner has a reasonable chance of success if Jason Hall is given enough control, his years of experience building Monolith is bound to pay off. Monolith has had success with licensed and original IP in the past, with him at the helm. Its a smart decision on Warners part hiring a person with a good amount of experience and a good track record. Well thats my 2 cents>