Kings of Convenience - What Walmart Tells Us About the Future of Gaming

Ben Cousins, EA

Andreas Gursky – 99 Cent (1999)

Generic Personal Opinion

Disclaimer

The personal opinions of the presenter

expressed during this talk do not necessarily

state or reflect those of Electronic Arts and

should not be interpreted in any way as

representing current or future policies of that

organization.

Any attempt to reproduce opinions expressed

during this talk as representative of Electronic

Arts will be met by snorting disdain, elitist

high-minded mocking and pedantic petty

corrections.

Nostradamus

‟The Wii will fail‟ – Ben

Cousins, E3 2006

‟The Wii will fail‟ – Ben

Cousins, E3 2006

FAIL

”Future of games is :-

• User Created Content

• Data in the cloud, not local

• Simple interfaces

• Mass market content

• Social Networking

• Hyperlinks

• Low system specs

• Persistence, levelling”

– Ben Cousins, Nordic Game 2007

”Future of games is :-

• User Created Content

• Data in the cloud, not local

• Simple interfaces

• Mass market content

• Social Networking

• Hyperlinks

• Low system specs

• Persistence, levelling”

– Ben Cousins, Nordic Game 2007

„The Innovators Dilemma‟, Clayton M. Christensen

The Automobile and the Supermarket

Piggly Wiggly (est. 1916)

Horatio Nelson Jackson

„New and Improved‟ – Richard S. Tedlow

1919

From the Smithsonian Collection

1920

From the Smithsonian Collection

1947

From the Smithsonian Collection

King Kullen (est. 1930)

„New and Improved‟ – Richard S. Tedlow

• The status quo was a high-quality but costly and inconvenient experience

• A new technology appeared and grew exponentially

• This technology enabled a new lower quality, higher convenience, cheaper consumer experience

• Expert advice was less vital because of wide choice and easy access to products

• Incumbent businesses assumed that customers had high quality expectations that would keep them paying the high prices

• The new business model grew exponentially and took over

The Internet and the Videogame

Tim Berners-Lee‟s first ever WWW server at CERN

Zzap 64 covers

• The status quo was a high-quality but costly and inconvenient experience

• A new technology appeared and grew exponentially

• This technology enabled a new lower quality, higher convenience, cheaper consumer experience

• Expert advice was less vital because of wide choice and easy access to products

• Incumbent businesses assumed that customers had high quality expectations that would keep them paying the high prices

• The new business model grew exponentially and took over

• The status quo was a high-quality but costly and

inconvenient experience

• A new technology appeared and grew exponentially

• This technology enabled a new lower quality, higher

convenience, cheaper consumer experience

Travian

Metin 2

Combat

Arms

Halo Wars

Assassin's

Creed 2

Modern

Warfare 2

• This technology enabled a new lower quality, higher

convenience, cheaper consumer experience

Online distribution cost falling

Consumer price trends

to zero

Lower quality expectations

• This technology enabled a new lower quality, higher

convenience, cheaper consumer experience

Infinite shelf space/time

Less need to ‘be noticed’

Quality less important to differentiate

• This technology enabled a new lower quality, higher

convenience, cheaper consumer experience

Entry price zero

Attention span shorter

Higher convenience

0

20

40

60

80

100

120

Me

tac

ritic

Sales – Week 1+2

Battlefield Heroes Gross Sales Graph

Accessibility

Battlefield Heroes Gross Sales Graph

Accessibility New items,

payment methods

Battlefield Heroes Gross Sales Graph

Accessibility New items,

payment methods

QualityBattlefield Heroes Gross Sales Graph

• Expert advice was less vital because of wide choice

and easy access to products

• Incumbent businesses assumed that customers had high

quality expectations that would keep them paying the

high prices

"Social games, social network integration,

mobile and portable games, a few you're

hearing a lot about today, they're

interesting and present brand

development and marketing

opportunities,”

“[But] they remain characterized by

unproven business models, a lot of clutter,

and relatively low barriers to entry,”

• The new business model grew exponentially and took

over

vs

Elite

Paradroid

Forbidden Forest

Firefox

Gauntlet

Operation Wolf

Arcade Home

Outrun

Gauntlet

Ghouls and Ghosts

Arcade Home

Space Harrier

Outrun

Commodore 64

Nintendo NES

House of the Dead

£0.50 = 10 minutes

Cost per hour = £3

Tomb Raider

£40 = 25 hours

Cost per hour = £1.60

PlayMeter 2006 figures

NA Industry total revenue

$6 billion

NPD 2006 figures

NA Industry total revenue

$13.5 billion

PlayMeter 2006 figures

NA Industry total revenue

$6 billion

NPD 2006 figures

NA Industry total revenue

$13.5 billion

Console software, hardware

Portable software, hardware

PC software

PlayMeter 2006 figures

NA Industry total revenue

$6 billion

NPD 2006 figures

NA Industry total revenue

$13.5 billion

Console software, hardware

Portable software, hardware

PC software

Air Hockey

Bulk Vending

Cigarette Vending

Countertops/Touch Screens

Cranes

8-Line Games

Electronic Darts

Foosball

Full Line Vending

General Business

Jukeboxes

Kiddie Rides

Pinballs

Pool Tables

Redemption/Novelty

Rotaries

Shuffleboards

Video Games

Video Poker

Further reading

The Innovator‟s Dilemma - Clayton M. Christensen

Free – Chris Anderson

Trade-Off – Kevin Maney

bcousins@ea.com