Tuesday, January 6, 2009

Co-production, digital distribution, and the future of video game publishing

The inspiration for this post comes from a developer interview on GamesIndustry.biz. The interview talks about the co-production method of development, which involves multiple studios coming together to complement each other with their respective core competencies. The benefits are the distribution of risk and greater accessibility to talent in various fields. Daniel Kozlov sees this collaboration method as the future of game development. The interview made me think of what this could mean from a greater perspective.

Publishers in the video games industry have three main roles to play in the value chain:
  • Marketing of titles
  • Distribution of titles
  • Technological support for development
Look at that list and try to imagine what it will look like in the future. Most people agree that digital delivery of titles is the future, which would make physical distribution of CDs and DVDs obsolete. So, cross distribution off your list, as it doesn't take much muscle to put a title on an online server for digital distribution on demand.

Now back to that interview with Kozlov, it seems to me that co-production could also lower reliance on publishers for technological support. So that bullet on the list becomes much less certain, if not crossed off altogether.

What remains is marketing. In my blog I have discussed examples of great marketing that does not necessarily involve million dollar budgets. Viral advertising and word-of-mouth are tactics employed very successfully by some independent developers.

The question is, will there be enough room in the value chain of the future, to justify the existence of publishers as we know them today? Or will publishing be reduced to involve only the console manufacturers like Microsoft, who would merely enforce platform standard compliance and make titles available on Live? On the other side, is it too far fetched to imagine production studios becoming their own publishers?

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