I love video games, but have never really gotten into massive multiplayer online (MMO) games. However, as an agency, we certainly understand them.
From an economic perspective, the sales of video games continue to outsell DVDs and music. Video games generally have a higher per product price than other forms of entertainment, but even the shift to cheaper digital downloads still puts them at the front of the entertainment category. From a retail perspective, the shift from boxed products to digital downloads online has been great for consumers, but pretty awful for many retailers (Best Buy, Circuit City, Blockbuster). A recent study reports that digital and physical product bought online or via mobile now accounts for 32% of the video market and 45% of games.
It shouldn’t be a surprise then that many consumer electronic manufacturers are looking for ways to capitalize on this market. To be clear, console manufacturers aren’t going down without a fight. Nintendo, Sony and Microsoft continually work to enhance game play through hardware and software enhancements. PC manufacturers have bigger problems, although some reports suggest that game-specific desktops are doing fairly well. I guess if I thought about it enough, it would be obvious that the next group looking to jump into this market will be TV manufacturers (especially since, like we predicted, 3D TVs have been such a bomb).
According to Douglas Heaven writing in New Scientist, a new PC interface for TV screens is set to change gaming and could herald future smart TVs with the power of modern PCs. According to Heaven, last week, Valve, the US firm behind the acclaimed Half-Life and Portal games, launched Big Picture, a television interface for Steam, the company’s PC-only video-game distribution and social-media platform. The move aims to change the gaming landscape. It will also accelerate a move towards smart TVs equipped with the power of modern PCs.
Even though Steam offers over 1500 games and claims around 50 million PC gamers, it is still something of an industry niche. Big game publishers such as EA and Ubisoft are geared towards console releases, with PC versions of games coming later, if at all. But even Sony’s PS3, the youngest of the current generation of consoles, is six years old. PC hardware, meanwhile, gets better and cheaper every year. With Nintendo launching its new console in November and Sony and Microsoft poised to follow in 2013, Valve is determined to muscle in on console territory: the family sofa. As a Big Picture promo video puts it: “Sometimes, you just want to kick it in the living room.”
“It’s about being a couple of steps ahead of the curve,” says John Walker, co-director of cult PC-gaming website Rock, Paper, Shotgun. “It’s a really interesting flag they’re placing.”
Big Picture provides an alternative interface for Steam which lets users bring their profile – including their social network and personal library of games – out of the bedroom or home office and into the family environment of the living room. It includes a TV web browser optimised for use with a game controller or a keyboard and mouse.
The downside is that you need to run an HDMI cable from your PC to the television. That’s fine for laptops, but will be impractical if the PC and TV are not in the same room. But TVs with built-in PCs are a future inevitability, says Walker. Such a combo would also make on-demand streaming of films over the internet far more convenient. Another possibility would be for Valve to offer its own Steam set-top box – a small, dedicated games PC running the Linux operating system. Valve is already adapting its games to run on a Linux version of Steam, Walker notes, making this less of a technological leap.
Both Steam and consoles face competition from cloud-based gaming services like OnLive and Gaikai, which Sony recently bought for $380 million. Because the computing for these games is done on servers in the cloud, a TV with a small set-top box is all the computing power that is required to play. But internet bandwidth limitations mean that cloud-based gaming cannot yet compete with the console or PC experience. Valve’s move will have a big impact on independent game developers, as getting approval to publish a game and charge for it via Steam is far easier than on consoles. And there are very few restrictions to distributing games on PCs. “Steam on a TV is massively exciting for an indie developer,” says Mike Bithell, who is lead game designer at Bossa Studios in London by day and an independent developer by night. “It’s a fast and easy way to take a game created with the PC in mind and transfer it almost immediately to couch play.”
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