Published as part of our sister-site GamesIndustry.biz's widely-read weekly newsletter, the GamesIndustry.biz Editorial, is a weekly dissection of an issue weighing on the minds of the people at the top of the games business. It appears on Eurogamer after it goes out to GI.biz newsletter subscribers.
The suggestion from Japanese publisher Marvelous Entertainment that it is to withdraw from creating original IP and focus instead on franchise sequels has been met with widespread derision from gamers, and some measure of sad head-nodding from industry insiders.
Both sides of the fence, however, see this as simply being a rather blatant step in a not entirely wholesome direction - an acknowledgement that in the boxed games market, at least, the risks of investing in IP have grown even further in recent years, and perversely that the market's willingness to support such investments seem to have declined.
That's due, in part, to the steady advance of platform fragmentation. Setting aside emerging platforms such as mobile phones and social networks - they're an entirely different story - we find the games industry divided up into a challenging assortment of different devices.
Beloved by core, upstream gamers, the HD consoles, namely Xbox 360 and PS3, are expensive to develop and publish games for, and neither has yet managed to eke out a commanding lead over the other - or an installed base truly big enough to give niche titles a fair chance at success. The PC, meanwhile, is cheaper to publish on, but is rife with piracy and suffers a shrinking boxed games market - hardly a place you want to make a major investment.
The Wii enjoys an installed base almost the size of the HD consoles' combined, and is quite cheap to develop for - with costs comparable with the last generation of hardware. The Nintendo DS, too, is in rude health in terms of installed base, but like its home console sibling, suffers from low software sales, especially of core titles and especially in the West.
The PSP feels like a platform limping towards a generation shift; except in Japan, of course, where it is a resurgent and important console, largely due to Capcom's Monster Hunter series.
Faced with this market situation, Marvelous - along with several other publishers - chose to focus its efforts on the Wii. The reasoning was solid enough - development for the 360 and PS3 is simply too expensive, making the risk of creating new IP so huge as to be unbearable for all but the largest and wealthiest publishers. The Wii has a huge installed base, and for all that they complain about the console, many core gamers still own one of them as a companion to their HD console.
What this didn't take into account, however, is just how fractured the market has actually become. Faced with critically acclaimed titles like Marvelous' No More Heroes, Little King's Story or, indeed, SEGA's MadWorld, the core gamers who might have been expected to pick up their Wiimotes for such software failed to do so. The games sold, but not in the kind of numbers that made them into a truly worthwhile commercial enterprise.
Regardless of whether they own a Wii or not, it turns out that the core market - the same market which so vocally demands innovation and new IP, and derides sequels and franchise updates - still prefers to play games on the HD consoles. That's not entirely surprising. If you're a core gamer, you probably own a HD television, and even if you don't play online multiplayer very much, you're still probably connected to PSN or Xbox Live and enjoy the benefits of those services.
However, the gamble was that you'd still be willing to walk the walk, having talked the talk over and over again, and would be swayed by acclaimed new IP to part with your cash. This was the gamble taken by a number of mid-range publishers - Marvelous is far from alone - over the past two years. It's a gamble which appears to have failed.
The argument has been made repeatedly in recent days that Marvelous simply "targeted the wrong platform". This is both true and largely meaningless. Developing boxed titles for the 360 or PS3 is much more expensive than for the Wii; had there been no alternative but to create 360 games, it's unlikely that Marvelous would ever have strayed into the original IP business and taken risks on games such as No More Heroes. This is the company behind Harvest Moon; it knows a thing or two about milking cows, and would have been content to continue doing so.
It would be easy, at this point, to mutter darkly about consumers getting what they deserve; to argue that if they're not willing to abandon platform prejudice in order to support innovative software, then they should stop moaning when game companies fall back on sequels.
Publishers and developers, after all, have a primary responsibility to keep their bank accounts healthy, their employees salaried, their buildings maintained, their debts serviced and their bills paid, none of which can be achieved merely from the happy afterglow of creating something really lovely and innovative. They need to make money, and if gamers don't buy innovative software, they're forced to turn to franchise updates.
However, this inclination to point at gamers and say "this is why we can't have nice things!" captures only a small part of the truth. The reality is that most core gamers don't really see the Wii as being relevant to their corner of our hobby.
It's a machine for children and middle-aged women, they feel - valid markets in themselves, but hardly relevant to the male teens and twenty-somethings who make up the core demographic (and who haven't quite got used to sharing this playground with other people yet, resulting in an unhappy proclivity to scuffles and tantrums around the sandpit). There's a sense that Nintendo has abandoned this demographic, and they, in turn, have abandoned the Wii.
The reality doesn't quite support this notion. Nintendo, in fact, publishes about as many core games on an annual basis as it always has - it's just that it also publishes a variety of titles like Wii Fit as additional items on its release schedule.
Third-party publishers, certainly, focus on the HD consoles for the most part, but there's still a decent stream of core-relevant games on the Wii. The problem is perception, and that problem arises from the absolute torrent of low-grade software which floods onto the Wii platform month after month.
The fact that the Wii is up to its neck in dreadful software feeds the perception of the platform as irrelevant for core gamers - a perception many segments of the specialist press have, shamefully, been only too happy to encourage. Moreover, there are serious suggestions that it has also damaged the perception of the platform within the casual audience which it so successfully won over, with consumers burned by low-quality software quickly deciding not to invest in the sector again.
Namco Bandai's sales, marketing and publishing VP Olivier Comte told MCV in an interview this week that the Wii market has "collapsed"; strong wording, but not an uncommon sentiment within the industry.
The tragedy is that the Wii is the best platform for innovative software for exactly the same reason that it has ended up swimming in sub-par rubbish - because it's cheap, quick and easy to develop for. What should have been the console's greatest strength has instead become its Achilles heel.
A solution is easy enough to see; Nintendo could, and perhaps should, become more ruthless in its quality control processes, denying access to its platform to substandard titles and making the "Licensed by Nintendo" seal into something actually meaningful once more. However, smaller publishers and developers would inevitably suffer under such a regime; it may even end up being more unpalatable, overall, than the current mess.
Instead, the failure of brave experiments on the Wii is likely to drive the boxed games market as a whole further into franchise territory, extinguishing the hope that a platform with lower development costs could act as an incubator for new IP and innovative ideas.
The positive side of this, however, is that boxed games are no longer the be all and end all of the market. Developers willing to take a risk on a new idea now have new outlets - PSN, Xbox Live, Steam, iOS and Facebook, to name but a few.
In light of this, it's easy to predict how the coming five years will shape up - with boxed product being restricted to franchises, sequels and blockbuster, marketing led titles from huge publishers, while the real innovation and development takes place on digital platforms, never touching the store shelves.
For all our misgivings about digital distribution, the market - consumers and publishers alike - has now ensured that innovation has little place in boxed games. That's a reality which we may come to regret.
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