GamesBeat

The DeanBeat: What the industry’s top leaders have to say about the video game business

Above: Reggie Fils-Aime of Nintendo of America shows off a Robot Chicken toy at E3 2014.

Image Credit: Dean Takahashi

I’ve spouted a lot of opinions about video games in this column. But I like to listen to what some of the smartest people in the game business have to say about what stirs their passions. Before, during, and after the recent Electronic Entertainment Expo (E3) trade show in Los Angeles, I had a chance to interview 18 different CEOs, executives, and game creators about their views of gaming. I’ve dedicated this week’s story to gleaning the most interesting observations from those interviews.

After all, that’s how I get a lot of my own opinions, and it’s the best part of my job. I talk to the people with the ideas, the passion, and the insights. Please check out my favorite quotes from each interview. These are the kinds of comments that gamers and industry followers can have long conversations about. They talked about creative freedom, digital disruption, and the craft of making games. I fully expect to absorb these quotes, internalize them, and use them to tout my own forceful opinions some day.

For each executive below, if you want to see the full interview and context for the quote, just click on the person’s name.

Reggie Fils-Aime, president and chief operating officer of Nintendo of America, acknowledged his company’s challenges head-on. He said, “The last three years for Nintendo have been operating profit negative. It’s a situation that we’ve never had before. For us, what that has done is brought into sharp focus the need for us to have compelling software to drive our hardware installed base, which will create an opportunity for independent developers to bring content to our system.”

He also spoke out against games that go too far in allowing players to shoot police officers. We took that to mean a criticism of Electronic Arts’ Battlefield Hardline, a cops and robbers game. He praised Ubisoft’s Rainbow Six: Siege, but he added, “I have to say, I see a lot of me-too content. I see a lot of shooters that don’t seem very differentiated. I see a lot of zombie games that don’t feel very differentiated. I see games utilizing gore and violence for the sake of gore and violence. I see things that trouble me. I don’t like the concept of a game where you’re shooting at policemen. I think that’s bad for our industry.”


Mike Gallagher of the ESA is a speaker for GamesBeat 2014.

Above: Mike Gallagher of the ESA is a speaker for GamesBeat 2014.

Image Credit: Michael O'Donnell/VentureBeat

Mike Gallagher, president of the Entertainment Software Association, said the right to make games, violent or not, has been clearly established under the law.

He said, “First Amendment issues are resolved and clear. Making sure that everyone necessary around the country understands that is certainly a part of what ESA does. But the Supreme Court case we won in 2011 has been a substantial catalyst for that understanding around the country.”

Gallagher added, “Also, it’s a great shield for the industry and its creative energy. The developers and storytellers and magicians making video game experiences can labor in a sense of security, knowing that their works are entitled to the same protections as books and music and movies. That’s a very profound, important thing. It’s known more broadly. We’re in better shape, probably the best shape we’ve ever been in, when it comes to first amendment issues as an industry. The industry has shown a great responsibility and responsiveness to that freedom.”


Hideo Kojima, head of Kojima Productions and creator of Metal Gear Solid V: The Phantom Pain, reacted to criticism of a torture scene. In response, he said, “Of course, I expected people to react to this. But then again, the theme of the game I’m trying to create here — these are very dark themes, themes like race and revenge. These are things I don’t want to look away from. I did see it coming, that people would react to this. But that doesn’t change the message I want to relate. There are things that I think we can’t look away from. What I’m trying to do is different from just shooting a zombie in the brain. We’re trying to depict something with a very specific message, things that have happened throughout history. Because I have very that very specific message I want to relate, there are things I can’t look away from, that I have to depict.”


 

Brendan Iribe, CEO of Oculus VR, made a return as part of Facebook at E3 2014

Above: Brendan Iribe, CEO of Oculus VR, made a return as part of Facebook at E3 2014

Image Credit: Dean Takahashi

Brendan Iribe, head of virtual reality goggles maker Oculus VR, acknowledged that creating an input system for interacting with virtual reality is a big task. He said, “On the technology side, we haven’t announced what we are shipping in terms of input or what we’re looking at as the go-to-market for a V1 input device. Input is going to be a long-term challenge. The most natural form of input for VR is just your hands. People put on the headset and look around and the first thing they say is, “This is incredible! But where are my hands?” We want to solve that, certainly. The second thing everyone does is look down and look for their hands, for their body.”

Iribe added, “We don’t know how long it’ll take to solve that. We do try to set expectation along the way. The first challenge was making a consumer headset that everyone feels comfortable in, where you get that sense of presence. Then we go from the sense of visual presence to getting avatar presence in there, trying to master input. What is eye input, mouth input, hand input?”


Tony Bartel, president of the GameStop retail chain, also dealt with his company’s digital competitors and how those rivals with address the consumer’s right to resell used games.

He said, “I’m not sure there’s exactly a ‘threat’ in digital. The key is all about consumer adoption. We view it as just another consumer option for purchasing a game. If consumers want it digitally, they’ll be able to get it that way, whether at GameStop or directly through their console. The issue of discovery is still important, whether you’re digital or physical.”

He added, “The other thing about a digital good that the publishers and platform holders are going to need to consider – and this is something that we see more than anyone else in our customer base – is that people who buy a physical game attribute $20 in residual value to that game. If you have no ability to develop a similar program on the digital side, where you give them that $20 of incremental value for a trade-in credit, then it’s going to be difficult for a digital game to sell at the same price as a new game, or even to sell above $40. As an industry, we need to sort that out.”


Eric Hirshberg, president and CEO of Activision Publishing, publisher of Call of Duty, said, “I remain fascinated by the degree to which it seems like we live in a franchise world. People, across all media, seem to be most attracted to worlds that have the depth and the complexity and the characters to keep them coming back over a period of years. You see it in the movie business, the book business, in our business. It’s different than it used to be. That makes launching new IP more challenging, but also more of an opportunity if you can get it right, as we’re hoping to do with Destiny. The reason for us betting big on it is because if you can do it, you don’t just have a hit this year. You have a new world for people to live in and come back to. To me, that’s a lot of fun, thinking about creative ideas on that scale. You look at it and say, is this a world I want to come back to again and again.”

Phil Spencer E3 2014

Above: Phil Spencer is the boss at Microsoft Xbox.

Image Credit: Microsoft

Phil Spencer, head of Microsoft’s Xbox game business, laughed when I asked him if he would listen to gamers who wanted a console price cut. He responded, “The one thing about running Xbox — I think about this business as a decade-plus business. I know you’re asking in a teasing way, but I don’t think I help anybody if I put the business in a position where it isn’t a rational business over a long period of time. If you buy a console and the console isn’t a success, that’s usually not great for you. I’m committed to making Xbox One a success for gamers, but it’s also gotta be a success for Microsoft. Both those things have to be true. That’s good for gamers. Giving consumers choice around a $399 console, I look at that as a way of making Xbox more successful.”

And on the topic of turning Halo into a TV show, he said, ” I love playing video games. Not everyone consumes stories through video games. To some people, that’s an abnormality. They don’t want to hold a controller. They just want to watch TV. Halo’s story is an interesting story. It’s something that we want millions of people to be able to see and experience. Video gives us an outlet for people who maybe aren’t going to play a first-person shooter game. They can say, ‘Okay, I get it.’ Because the story has merit on its own. That obviously makes Halo the name, the brand, more valuable, more popular, more enticing, because more people know about it. If certain people then choose to play the game, that’s great, but we don’t look at it necessarily as an on-ramp to bring all those people to the game.”

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