The Connection Between Zynga, Nintendo, And VR

The Connection Between Zynga, Nintendo, And VR
December 10, 2016

Video game economics and consumer expectations are rarely aligned. You can call it the 2015 Konami problem. The profitability of tremendously detailed game worlds is a problem that is much more nuanced and difficult than sales numbers suggest, and success can be dependent upon consumer expectations.


Zynga, after years of meandering in the corporate strategy doldrums, saw the fruits of its 2014 acquisition of NaturalMotion and released an iOS game with tremendously high levels of graphics quality (for a mobile title): Dawn of Titans. Kudos to NaturalMotion for surviving the budgetary battles that were necessary to put a beast like this game out, and for having the artistry and skills to ship it. The game looks gorgeous.


Now that it’s released, I’ll closely follow its sales trajectory. I would be hard pressed to prove that mobile consumers have been demanding a game at that level of fidelity, but it makes for a great salespoint.


After Infinity Blade, it looked like we would see a renaissance of console-like mobile games spitting out profits, but that hasn’t come to pass. I hope Dawn of Titans makes a tremendous profit (reviews are good!), because I’m sure for most mobile users that haven’t expected games of this level of fidelity, it will be eye-opening to them. And I’d like to see investment in the F2P mobile space that goes using graphics fidelity as the marketing tactic that it’s currently being treated as.


Dawn of Titans launched the same day as Super Mario Run had its demos, what is sure to be another game beautiful both graphically and from the perspective of its core gameplay. Here, too, we deal with the sticky topic of consumer expectations. We know what to expect from Nintendo. We shouldn’t know what to expect from a Super Mario mobile gameBut our expectations are very high regardless.


Nintendo is one of the few companies in the world that can completely dash consumer expectations but come out on top. I never count Nintendo out. Super Mario Run doesn’t need to be a tremendous seller; I believe its cost of development was controlled and that is going to ensure that the company can make a profit quickly. I am curious, though, once consumer expectations are set, what happens with Super Mario Run 2.


The dangers of consumer expectations are being felt strongly in VR this week, with developer Dean Hall speaking publicly about something we don’t often discuss in the game industry: that our customers’ expectations are often out of line with the reality of development costs, and subsidies are normal in the industry to ensure content gets made.


Big companies can absorb such criticism (and may even praised for their work gardening the platform.) They need to keep PR fronts going for consumers, partners and investors. (Note that it’s surprisingly easy to hide losses behind successes when no one bothers to think through even the most basic realities of the game industry.)


In nascent markets like Virtual Reality, however, you have so few customers that as a developer you can’t afford even a small group of them to get offended. But this is happening, and it’s killing something wonderful. Consumers who invested in expensive VR devices are angry at their expectations for the types of experiences they should be happening now, and to criticize the hardware companies (who, other than developers, are the only other party to critique) would be to criticize themselves for making the choice of investment.


The result: consumers take their aggression out on the developers who are more easily accessible, and as artists, more prone to being mentally damaged because they’re suffering (through low wages and long hours) for the art they had been intending to build for audiences that they had hoped would appreciate it.


The hype has been going for years with people writing articles about the future. Hype was needed to get the investments required to kickstart a new market, and it was needed to sell consumers on expensive hardware to further justify content investment. Gamers are used to about two years of console hype before touching that future. It’s been four years since the Oculus Kickstarter, and hype and reality haven’t matched on the content front. VR content is expensive and hard to build. Graphic fidelity investments are unproven as returns, and take even more time. Forget building on tech that’s still unfinished. Meanwhile, as time passed, expectations went higher. The consumers lit the torches.


Dawn of Titans came as a surprise. Expectations had not been set. Impressions have been favorable, and I hope it makes a profit. Super Mario Run has expectations, and they will likely be met, and I am sure they will make a profit. Impressions are sure to be favorable. VR’s expectations were set too high, and need to be reset. My feeling is that the market growth numbers are still too optimistic for the next few years. If we set the market more reasonably, we’ll surpass expectations, which will be better for everyone in the long run — both for the devs who want to keep creating content as well as pay the rent, and for that awesome, crazy future when we can achieve the Metaverse.

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