“Video games will be the fastest-growing and most exciting form of mass media over the coming decade” declares the headline to The Economist’s recent video games special report “All the world’s a game.”

According to PricewaterhouseCoopers (PwC), a consulting firm, the global video-game market was worth around $56 billion last year. That is more than twice the size of the recorded-music industry, nearly a quarter more than the magazine business and about three-fifths the size of the film industry, counting DVD sales as well as box-office receipts (see chart below). PwC predicts that video games will be the fastest-growing form of media over the next few years, with sales rising to $82 billion by 2015.

I don’t love video games. I’m not good at them. But I’m so enthralled by Raiders of the Lost Ark-like cinematic experience of games such as Uncharted: Drake’s Deception that I’ll play them on “Easy” just to get to the next reveal. It’s also why I’m more wedded to the PS3 console, because of story-centric exclusives such as Uncharted, and the just-announced I Am Legend-inspired horror-apocalypse game, The Last of Us (trailer below).

I’ll temper my excitement about The Last of Us (due in late 2012, early 2013) until I hear whether it’s in 3D or not. Yup, you heard me. I didn’t think much of the blockbuster Avatar — as a movie, or as a 3D experience. I’ve resisted the urge to get a 3D TV because the glasses strike me as anti-social, unhealthy for young children, and hardly worth the investment especially with companies like Toshiba developing 3D technology that doesn’t require eyeware.  But when it comes to interactive cinematic entertainment such as Uncharted (and now Batman Arkham City, which I’ve just started), I’ve discovered that 3D makes the story experience that much immersive. It’s akin to introducing home theater 5.1 surround sound into the home after a lifetime of mono television. It helps that Sony just released an accessibly-priced 24″ 3D monitor that works for both PS3 and Xbox (already reduced to $399 — glasses, game and HDMI cable included – $299 this week at Best Buy for American residents).
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Last month, Wolfire Games, an independent game developer and distributor, unleashed a pay-what-you-want campaign for a bundle of indie games that seemed to take a play from the famous Radiohead pay-what-you-want experiment. The Humble Indie Bundle, as it was called, was offered from May 4 through May 11, and generated over $1.2 million in revenue for the game developers who participated, as well as two charities.

The bundle initially consisted of five indie games: World of Goo (2D Boy), Aquaria (Bit Blot), Gish (Edmund McMillen), Lugaru (Wolfire Games), and Penumbra: Overture (Frictional Games ). Later, Amanita Design kicked in a sixth game, Samorost 2. All the  games run on PC, Mac, and Linux platforms.

People could literally pay anything they wanted for the Humble Indie Bundle, starting at $.01. The largest single donation rang in at $3,333.33. I personally paid $10.01. You could choose to allot part or all of the price to the two charities, Child’s Play and the Electronic Frontier Foundation (EFF). While you could have bought the games or donated to the charities separately, the combination of the two made the bundle appealing. You can’t deny the power of one -stop shopping.

John Graham, Chief Operating Officer of Wolfire Games, was kind enough to answer some of my questions about the Humble Indie Bundle campaign in a post-promotion debriefing.

How did the idea for the pay-what-you-want Humble Indie Bundle come about?
Ever since the success of 2DBoy’s pay-what-you-want experiment and our Organic Indie Preorder Pack [a game bundle of Wolfire’s Overgrowth and the Unknown Worlds’ Natural Selection 2], we had this feeling that independent developers could really do a lot to promote themselves.
How did you decide what games to put in the bundle?

Our main requirement for this bundle was that we needed awesome indie games available for Mac, Linux, and Windows.  We didn’t have a fancy rubric, and weren’t maximizing any kind of bundle hotness equation, but I think it’s fair to say that we ended up with a group of games that are all different but very awesome.
Have you ever tried anything like this before? Did you learn anything from the Radiohead pay-what-you-want experiment?

Well, our theory was that a pay-what-you-want bundle would maximize participation and also allow people to feel like they were getting their money’s worth, and I think this proved true.  With pirated copies already easily available for all the games, we figured our biggest risk was not piracy but rather that we would spend a lot of time on this promotion, and then no one would hear about it. Read more…

For years, Nintendo has ruled the mobile gaming world, first with the Game Boy, then with the DS Lite. After an amazing run, though, the torch is being passed. Not to another gaming company, but to smart phone makers Google and Apple.

Over the next decade I believe smart phones will be where most gaming innovation will happen. The market for smart phone games is booming. A recent New York Times article reported that games make up more than half of the billion downloads from the Apple App Store. The App Store has about 15,000 games for the iPhone, and the Android Market has about 3,000 for Google Android devices.

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For years, video games were strangely absent from the social media tidal wave. Aside from casual games built into social networking websites, games didn’t support social media.

The recently released (Oct. 13) “Uncharted 2: Among Thieves” for the PlayStation 3, hopes to change that with a built-in Twitter feature. The game uses Twitter in a fairly simple way, by sending updates on a player’s progress to his or her Twitter account.

Twitter is also at the heart of a social media update to Microsoft’s Xbox 360 that went live today. It allows you to post tweets, read the tweets of those you follow, search and view trending topics. Along with a Twitter app, the Xbox 360 update also has a Facebook app to stay connected to friends through basic Facebook features.

These instances of Twitter in video games—one software and one hardware—still only scratch the surface of the potential to meld social media and gaming. The use of Twitter in “Uncharted 2” seems like a good way to market the game and to find other people who play the game, but beyond that it doesn’t do much. And the Twitter integration on the Xbox 360 isn’t very deep, as you can’t run the app while you are playing a game.

The real issue here isn’t how Twitter is integrated into games or hardware platforms, but how the gameplay can take advantage of social media’s best assets—connecting people and sharing information.

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On Sept. 9, the Beatles finally entered the world of digital music. This was an inevitable move, but what’s truly interesting is how they chose to do it. Well-known Beatles fan Steve Jobs has yet to secure the world-famous music catalog in a digital format for iTunes. So who did? MTV/Viacom and their video game studio Harmonix, which created “Rock Band: The Beatles” for video game consoles.

Money is said to be one of the sticking points in the negotiations to bring the Beatles’ catalog to iTunes. I have no doubt that money influenced the Beatles’ decision to do a video game, but I’d also bet that they wanted to do something different and cutting-edge. Read more…

Ace Team, a video game company in Chile in the effort to fight piracy is using the P2P model: “All the games are there to be pirated.  We were not going to be the exception.  Once we saw the game being distributed by BitTorrent, we started to post comments in these pages appealing to those who downloaded the games” Stated a member of Ace Team.  The statement they post on this pages says that they cannot do anything to stop piracy, but if who ever is downloading the game likes to test the game and likes it, they encourage them to buy the game.

This may sound crazy, but it is actually working according to Ace Team. P2P members are posting messages stating that they have bought the game, and that they do it because of Ace Team attitude!

Would this be a new marketing model in the internet for video games, e-books, movies and music?

With the statistics data showing more and more people spending their time on video games, it’s not surprising that TV audience numbers are plunging. Movies are doing a little bit better than TV, but I’m pretty sure Hollywood moviemakers don’t feel safe. Looks like we are witnessing an interesting shift in people’s preferences.

A couple years back they used to release pretty successful videogames based on movies. Examples: Medal of Honor (3 more series released after the first one’s success), Matrix, Lord of the Rings. Nowadays exactly opposite is happening: Doom, Hitman, Max Payne – all of these are movies based on the same-titled video games.

Hitman, would be the great example illustrating this trend. It’s a complex game that requires thinking, strategy and precision. Game had a great success and currently has four series (first one released in 2000)

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The New Xbox Experience

A Forbes.com article detailing tomorrow’s launch of the New Xbox experience emphasizes the trend of services adopting social networking features to enhance sales.

The New Xbox experience will have an updated user interface that expands user’s ability to make social connections transforming it “from a a multiplayer matchmaking service to a social and entertainment network.” Another highly anticipated feature in this release includes a partnership with Netflix – allowing Xbox users to instantly stream movies and TV episodes.

The article makes an interesting prediction -

“And all this focus on social networking suggests that some day consumers will make their console purchasing decisions based not on the power or tech specs of the console, but on its social capabilities.”