Traditional game veterans adapt to a world with CityVille and Angry Birds

There’s a specter hanging over the traditional video game industry, and you can see it in the image above. Social game companies such as Zynga and mobile games on the iPhone are grabbing players by the tens of millions. The traditional video game industry isn’t growing like it once was.

But the star designers of traditional games aren’t running scared. In a panel at the Dice Summit, which gathers 700 of the game industry’s elite in Las Vegas from today through Friday, game industry veterans said that they’re used to the constant chaos, change, and adaptation that has to happen in the industry. Companies such as Zynga, maker of CityVille, and Rovio, maker of Angry Birds, have disrupted the game industry and the industry veterans think that’s a good thing.

The game veterans pictured above said they continue to work on hardcore console and PC games that they always have. But they’re playing games from the new guys. As a group, these game designers are looking to learn what they can from social and mobile.

The social and mobile game companies are crashing the party at Dice and at the larger Game Developers Conference coming in San Francisco later this month. But it was still surprising to see a panel with no social and mobile game makers sing the praises of that new segment of the game industry.

Mike Morhaime (pictured right), head of Blizzard Entertainment, said he plays Words With Friends, a Scrabble-like word game on the iPhone, so that he can connect with old friends.

Greg Zeschuk (far right), co-founder of Electronic Arts’ BioWare division, said he pulled someone into his office to show off CityVille on Facebook. “Come take a look at the future of games,” he said. He said game designers can now reach so many users so fast with games that are accessible and easy to play; CityVille grew to 100 million users in less than two months on Facebook.

“We have never had a chance to reach so many people so fast with something so easy to play,” Zeschuk said.

Bruce Shelley,  co-founder of the now-defunct Ensemble Studios and maker of Age of Empires, was so enthralled with Zynga’s FrontierVille (made by his friend and game veteran Brian Reynolds) that he decided to start work on Facebook games himself.

“This [game] had engagement,” said Shelley (pictured right). “It was a real game. It meant that game design had been brought to a new space where it had never reached before.”

Shelley is now a contractor working on a game design project with Zynga. He is offering tips to Zynga’s neophyte game makers, who in turn are offering him tips about how to operate in the fast game design cycles that Zynga follows.

Shelley co-founded his game studio in 1995, a great time to get an independent game studio together to make high-end PC or console games.

“I thought you would never be able to do that again,” he said. “But today, there has never been a better time to start a game studio. I have this vision of a dam breaking and all of this opportunity rushing downhill.”

Now at Zynga, Shelley said it is remarkable how fast the company can move. “I’m just asked to make the games more fun,” he said.

Mark Cerny (pictured right), a freelance game designer who has worked on many blockbuster games with Sony, said, “Bruce will be able to create a game faster than it will take us to get a lawyer assigned to create a contract.”

Ray Muzyka, co-founder of BioWare, said that the game industry feels like it is in the middle of an S-shaped curve, meaning it’s about to see another huge wave of growth.

“A lot of existing players are going to have to adapt in order to thrive and survive,” he said. “New players are going to come into this market and surprise the heck out of us.” However, Muzyka also said it was still refreshing to see outstanding hardcore games surface, such as RockStar Games’ Red Dead Redemption, an epic Western game that has sold 8 million units on the consoles.

Cerny said he was happy to see original indie games such as Flower, a downloadable game on the PlayStation 3 that let gamers play the wind in the dream of a flower in the middle of a dilapidated city. Games like that one aren’t huge money makers, but they earn enough to make their money back and more.