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Will Hollywood's slump hit video games?
Tinseltown's malaise may seep into the game industry if publishers aren't careful.
June 27, 2005: 3:03 PM EDT
Game Over is a weekly column by Chris Morris
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NEW YORK (CNN/Money) The video game industry loves to compare itself to Hollywood.

Publicists regularly liken graphics in new games to "Shrek" or any of the Pixar (Research) films. Some titles tout the voice work of A-list actors more than the gameplay itself. And publishers squeal in glee when a studio picks up the rights to one of their franchises.

But as the gaming industry strives so hard to emulate Hollywood's success, it's in danger of falling into the same mudhole the movie folks are mired in these days.

You've no doubt heard about this year's box office slump, the worst in 20 years. Some blame the films. Others blame ticket prices. Everyone seems to agree DVD sales are cutting into things. Obviously, there are some differences, but the same problems are starting to creep into games. And the resulting revenue slump could be the same or worse.

Let's break it down a bit.

First off, though it might shock the suits in the executive suites, audiences don't like seeing the same thing again and again. It's true for the cinematic remakes of "The Honeymooners" and "Herbie: Fully Loaded" and it's becoming true of the innumerable "Grand Theft Auto" clones. (About the only thing outnumbering those at this year's E3 trade show was the avalanche of World War II titles.)

Copying successful formulas isn't a new thing, of course. Two years ago, you couldn't swing a dead joystick without hitting a few "Lord of the Rings" games.

Sure many of these cloned games and cloned films rack up reasonably strong numbers, but there's a difference between seeing or buying something because you're eager to watch/play and because there's nothing else available.

Both industries seem to have forgotten that innovation and fresh ideas are what captured audiences in the first place. Remakes and clones might put some change in your coffers in the short term, but you lose respect and credibility from your customers each time you do so. The film and gaming industries are supposed to be fonts of creativity, but lately both seem afraid to risk trying something new. It happens occasionally, but not as much as it should.

The matter of ticket and game prices is a bit trickier. While it's an unpopular truth, the economic reality is that prices do need to go up from time to time.

So while cutting prices isn't an option, game makers can avoid alienating their audience in a couple of ways. Digital distribution is in a nascent stage right now, but has shown potential. Valve Software, a trailblazer in the field, won't reveal how many copies of "Half-Life 2" it sold via its proprietary content delivery system Steam, but has said the profit margins on those were substantially higher than retail store sales.

There is, of course, no way the gaming industry will survive on digital sales alone. But by offering it as a lower cost alternative, publishers and developers can maintain the profit levels they need to keep investors (and employees) happy and give customers the opportunity to feel like they're getting a bargain.

Episodic gaming is another opportunity to foster innovation and keep prices down. Like the movie serials of the 30s and 40s, a game that updates every week or every month can keep players coming back. And since the experience will be a shorter one, it should be cheaper as well. Microsoft has already vowed to offer episodic content as part of Xbox 360. Let's hope they follow-through and lead by example.

The advent of home theater and DVD sales are certainly part of the reason people are avoiding the theater, but it goes a bit deeper than not having to leave your living room. Today's moviegoers, not to put too fine a point on it, are jerks. They kick seats. They constantly chatter amongst themselves, oblivious to others sitting around them. And they are seemingly incapable of pressing the 'off' button on their cell phones and pagers.

Why, dear God, would you want to pay to spend time around these morons?

So what's the gaming parallel? Online.

Online gaming can be a terrific experience and add a new dimension to a title. Too often, though, you find yourself surrounded by obnoxious folks who feel the anonymity of the Internet gives them license to act the fool. There's no quicker way to lose interest in a game than hearing a 15-year old scream his favorite obscenities for no real reason.

Screeners do exist to block "griefers," as they're called, but they really don't do a sufficient job. Microsoft (Research), to its credit, certainly seems to be trying to raise the bar with its next generation of Xbox Live.

Until you're able to avoid these twerps altogether, though, you risk recreating the frustration you experience in the theater only this time you won't be able to dump a bucket of greasy popcorn on their heads.

There's still time for the game industry to avoid a slump. With the next generation coming, it's hardly imminent. (So far this year, in fact, software sales are up an impressive 25 percent, according to the NPD Group.) But executives at publishing companies need to look ahead and realize that when it comes to keeping fans happy, Hollywood's system might not be the best one to emulate.

Is innovation dying? The creator of Donkey Kong thinks so. Read more here.

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Morris, who keeps his yap shut at movies, is Director of Content Development at CNN/Money. Click here to send him an email.  Top of page

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