Money Making Machine

07Jan09

consoles-drop-inAlthough I haven’t had much time to play them recently I love games and so do millions around the world. I’ve got an Xbox 360 and a PS3 both of which offer the ability to download content.

On the Xbox Live marketplace You can download films, music videos, games and updates. These features are also available on PS3 but I have not used them much so for the purpose of this post I’ll concentrate on Xbox.

As I did yesterday I want to keep thinking along the lines of the ways in which brands can adapt, evolve and diversify their offering using the network to enable their consumers to be reached and by monetized by the brand in new and exciting ways, which add value to the ownership of the product and the brand in question.

In April 2004 I wrote my university dissertation about games. It was entitled “Does Non-Linearity Improve or Diminish the Player’s Experience of a Narrative Within a Videogame?”

It concluded with the following paragraph

Instead of being a projection of our feelings, which a completely non- linear narrative would be, a prescripted narrative gives “us something safely outside ourselves (because it is made by somebody else) upon which we can project our feelings.” (Murray, 2001: 100), prescripted narrative does not diminish but enrich the experience of a narrative.”

Me, 2004
Murray, Janet H. Hamlet on the Holodeck, 2001.

Essentially as players, readers, watchers and listeners we always need an author outside of our self to have a satisfying unexpected narrative experience.

This is still true and for games publishers is brilliant news in the current climate because their networked products allow consumers to access media at their convenience and without any middle man, which means the price point is reduced while maintaining a healthy profit margin, essential to allow the flow of revenue into a business when prohibitively high prices drive people away from investing £40-50 a time in a new game.

Microsoft have perfectly positioned their Xbox business for changes in the economic climate and have an incredibly diverse set of consumer offerings available to help their business and their consumers a way to ride out the storm while still making money and enjoying narrative content.

I am really interested to see how GTA IV: The Lost And Damned sells when it is released soon. It’s an expansion pack which requires that the gamer has purchased an copy of the original copy of the game, so have already made a sizeable investment in that narrative. Those investors are now required to make an additional payment to download the expanded narrative content over the Xbox Live marketplace. GTA is the fastest selling game of all time shifting over 6 million copies in the first week alone, I’d estimate that the game has now sold in excess on 20m units (I will check this with Rockstar tomorrow and update) so the potential market for this expansion pack HUGE.

Microsoft paid Rockstar $50m in order to make the expansion pack exclusive to Xbox 360, it will not be available on the PS3, a wise investment in trying economic times? YES.

More games are following suit with expansion packs being released for Fallout 3 and others which extend the life of the product (Microsoft made a mistake in not planning an expansion pack for HALO3) whilst taking more revenue which traditional online play offers the opportunity for.

Couple all of that with the ability for consumers to pay small amounts to download movies and Microsoft have created a networked money making machine.

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