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If there is a hit factory in casual video games, it’s PopCap Games. While other companies drove the industry to increasingly complex and narrowly-focused games, Seattle-based PopCap has broadened the market for games and revived the arcade-like feel of early video games. About 76 percent of its customers are female and 89 percent are 30 or older. The top reason people play: stress relief. (So says the company’s surveys).
The Seattle company had sold more than 2.7 million games at retail during 2007. Since 2000, its games have been downloaded more than a billion times. And its big hit, “Bejeweled,” has sold more than 10 million units since it debuted in 2001. Its other big hits include “Zuma,” “Bookworm,” “Chuzzle,” and “Peggle.” Each month, gamers spend about 3 billion minutes playing PopCap games. Bejeweled for the iPhone has seen more than 1.2 million visits in four months.
I sat down with CEO Dave Roberts and co-founder John Vechey, director of operations. They explained why the company stays focused as a game developer and leaves publishing to others. why they’re not interested in venture capital, and how they develop games that are bigger than “Halo.”
Three top investment pros open up about what it takes to get your video game funded.
VB: What is your history?
Vechey: We started the company in 2000. It was myself, Brian Fiete, and Jason Kapalka. At the time, we were going to do simple little web games. There was no good business model for it. Our first game was “Bejeweled,” a Java game you play in your browser. We partnered with MSN. It wasn’t really making much money for us. It was a small licensing fee (of about $1,500 a month). At the time, advertising was the only way you made money from browser-based games and the ad market was pretty much gone. We had a lot of success in numbers. We were getting 45,000 peak simultaneous users. It was by far the most popular game on the Internet. But it was tough because we weren’t making any money. We had tried to sell it for $60,000. Thank God, no one bought it.
After a year and a half, we considered doing a downloadable version of the game. People asked if they could play it offline. We created a deluxe version, with better sound and music and graphics. You play offline. We released it on our little web site. In the first month, we made $35,000, which was amazing for three guys. The next month we made $35,000. So we went to bigger companies like Yahoo Games and MSN Games. We said we can give you the web version now. We won’t charge you that $1,500 a month anymore. And we asked them to put this downloadable version up. We could share revenues when people purchased the downloadable version. That created a casual games industry. That became the start of the business model.
VB: What gave Bejeweled this staying power?
Vechey: It’s not technology based. It’s not like “Half-Life” or “Quake.” In a year, it doesn’t look outdated. It never gets outdated, like “Tetris.” It’s fun and relaxing. It’s a universal thing. You play it and want to beat it.
Roberts: (Gaming started with simple and non-violent games in the 1970s). It wasn’t until the 1980s that gaming became this high-tech thing for 14-year-old to 20-year-old males. Gaming before that was men and women. It was parlor games for all ages, like Mah-Jong. (As gaming became more violent and complex), it got hijacked. Big companies build bigger and more expensive games for fewer people. PopCap is not trying to do that.
VB: Did you have this conscious strategy to take gaming back to its roots?
Vechey: I wish I could say that was how we were thinking. We wanted to do simple games for everyone. We weren’t leading a revolution. We were just doing what we thought was fun. We were hardcore gamers. It was more satisfying making a game that anyone could enjoy than making a game for just us. As I continue to make more mass market games, people ask if we want to make hardcore games. Not really.
Roberts: Conversely, we get asked if we make games specifically for women. It’s one of the challenges when we talk about the company. People think it’s games for girls. More of our customers are women than men. They ask us if we do focus tests with soccer moms. We don’t.
VB: Violent games have never been your thing?
Vechey: We play violent games. I like them. I like to get that rage out. It’s not for us. It’s not our brand. We like that we are a family-friendly, safe brand. We never had a game where violence would make the game more fun. It has to reinforce the game play. With Bejeweled, we picked gems because we saw that it would be fun if we have every object be a different shape and different color.
VB: What is your favorite statistic about your games?
Vechey: It’s the estimated hours spent playing our games. About 16 billion. That’s how much time we’ve sucked out of the world. Bejeweled and Bejeweled 2 have consumed about 6 billion hours. More people have played Bejeweled than have played “Halo.” Halo is awesome. I’m not slamming it. It feels fun to me. That is a gratifying thought. So many people have played our games and had fun.
VB: How did you create the hit-making machine beyond the first hit?
Vechey: Bejeweled was our first big hit. But there were a lot of games between that and our next hit, “Zuma.” It’s not like we have had all hits. We’ve learned a lot of things. We have to find the game compelling. We released some games after Bejeweled that were cool but we weren’t always playing them. We have this attention to detail grind, polishing and making sure it’s fun. We have this rule that if a game is not fun with programmer art, it’s not going to be fun with polished graphics. If it’s not fun without sound, it’s not going to be fun once you add the sound. A great score will make a movie better, but it can never make a bad movie good.
Roberts: One thing I hear often in the studio, when they’re looking at other games, is: ‘This could have been a great game if they finished it.’” Even now, a lot of stuff released in the casual space is rough around the edges. How balanced is a game?
Vechey: That’s a frustration with hardcore games too. There are very few games like Halo, where they ease you into it but you’re always having fun. Very few game companies have that attention to detail. Blizzard, Valve and Bungie are the three that I can think of that won’t let that quality bar die. When we are compared with those companies, we are honored and flattered.
VB: Casual games look like they don’t take much time or effort to build. How is your process?
Vechey: It kills people. It’s fewer people than big console games but it can destroy their souls. We canceled a game that people were working on for three years. That’s a record. The “Peggle” process was about nine months of playing and prototyping. We took a concept like Pachinko. We knew it was fun in the arcade but not on the computer. It took about nine months for us to nail it down. You shoot balls, try to get rid of the pegs. Then at that point, we spent another year making the game. And we spent nine months again from when we could have released it to polishing it. Those little things make a big difference. If someone doesn’t beat a level, they don’t find the game fun. We make sure your first experience in that first level is something you can beat but doesn’t feel too easy.
VB: If EA has 100 people working for a couple of years on the average game, what is your staffing like on a game?
Roberts: It’s a few people for a couple of years. We don’t really track development costs to see how much time we spent. I liken it to other creative processes like writing a novel. How much does it cost to write a novel? Does it matter? It’s more about how can you get a good novel written. The creating of the novel is hard to measure.
Vechey: We have some games that cost $200,000 to make and some that cost over $1 million. To us, we don’t track the costs of a studio. Peggle is eventually touched by 30 or 40.
Roberts: The core team is three or four. There are testers, localization teams. Quality assurance.
Vechey: Does EA even have any QA? (laughs). In Peggle, we made choices that add a lot to the game. Every backdrop is a hand-painted backdrop. We felt that added a lot. For the power-ups, we chose to make them into characters. We don’t ever think about choices that get a game out faster. We make choices about how it makes a game more fun. The backdrops put you in this weird world and makes it more fun.
Roberts: It’s the first of our games that has a hardcore base. We gave it to the guys at Valve and slowed down their development.
VB: I’ve heard this description of PopCap as “the Lennon and McCartney of casual games.”
Vechey: That’s great.
Roberts: All of the portals and distribution outlets are putting up a game a day. When Peggle first came out, it was a worry. The casual game industry is commoditized content. They’re all about what is new this week. There are a lot of little developers. They make cool games with a half-life of 15 seconds. The questions was whether we could make a hit game in that environment. When Peggle came out, it took a lot of patience on our side. It’s become a success. The iPod has been a huge boost. Valve did a mash-up with Half-Life characters. That got buzz going. There is a pattern in casual games that mimics what happened in the hardcore space. Lots of pure sequels. They don’t add much value to the first.
VB: That’s happening in casual too?
Roberts: It’s getting formulaic and that shows.
VB: There is a positive side. Microsoft calls it the democratization of games. Anybody can make make them. You don’t need a team of 50 people.
Roberts: That is a great thing. But anybody can write a novel too.
Vechey: Which isn’t a good thing.
Roberts: A word processor doesn’t make a novelist. The studio can hire as many people as they want. But the trick is finding people who can make games. We try to be slow and deliberate. We are about 180 now worldwide. That is frightening and amazing to us.
VB: Why haven’t you made the leap from game development to game publishing?
Roberts: We find that we have a hard time doing arms-length publishing. We do co-development instead of publishing. We didn’t want to build a machine to do publishing. That assumes we are a distribution company. We do our own distribution, but we are a development company first and foremost. We decided we’re better off building games.
Vechey: We’re more like a Pixar. Why don’t they distribute movies? They exist to create good movies. That’s what we are. It’s our DNA.
VB: The pattern has always been that in the game industry, once you succeed as a developer, you become a publisher. Even when there is resistance to that, like when Bioware and Pandemic teamed up to be a development company under Elevation Partners, look what happened. They got bought by a publisher. Pixar is now part of Disney.
Roberts: It’s like the pharmaceutical industry, where the biotech….
Vechey: Please don’t compare us to pharmaceuticals. You once lectured me for calling our games addictive.
Roberts: Big pharma doesn’t do its R&D anymore. They invest in small companies that take the risks. We’ve heard John Riccitiello talk about creating EA as a bunch of small studios. If they can pull it off, it would be a coup. We even struggle with that with 180 people. We need to let small teams do what they need to do. People ask us what a greenlight process is. We don’t have one. If there is a fun game to be made, they make it.
STUPID VENTURE CAPITALISTS
VB: There are about two casual game companies coming out stealth a week. They have venture funding or angel funding. I don’t understand what is going on here. Is this crazy?
Roberts: The VCs have been trying to invest in casual games for a long time. It’s hard. There are a lot of little studios but not a lot of bigger companies to invest in. It’s risky. But all the big players have decided that casual is important. They create MySpace-Facebook-casual-games portals. We still believe it is about the game play. If the bias of these companies is all about the business model, I worry about it. There are 100 Bejeweled clones. But our product is really good. If you don’t have it, you won’t succeed. A game has to sell itself. There have been failures of venture-funding companies.
VB: A few years ago, the craze was mobile games companies. Now it’s casual.
Vechey: It’s kind of scary. You don’t want stupid venture money coming into this space and screw it up for people who have great businesses, like the CD-ROM business way back when.
Roberts: The Wii is a great platform. But even there, there is some indication that the Wii is becoming polluted with crapware. First-party Nintendo titles are going to do well because they are polished. But all these other titles are jumping on the bandwagon.
Vechey: The bandWiigon. (laughs) Sorry, I got up early this morning.
Roberts: The lesser games aren’t selling. That is a risk for the Wii. We are excited about the Wii. It will take us a while because everything does.
VB: Can you make downloadable WiiWare games?
VB: Do you have anything ready for the WiiWare launch?
Robert: No. We are preoccupied with the iPod. We think it is a great platform. It took Nintendo a long time to pull WiiWare together. Microsoft created Xbox Live Arcade and spent an inordinate amount of attention on it. It was a huge investment for them.
VB: I’m not sure how long all of the venture funding will continue.
Roberts: It’s a good question. I was looking back at stupid venture money in the bubble. The venture business as a whole has gotten a lot smarter. Before they ruin an industry, they get out faster.
VB: Are you interested in raising a round?
Roberts: We have talked about it but we really don’t know what we will do with the money.
Vechey: We were funded by Top Ramen. They were a sponsor of ours with cheap food (laughs). We asked what would we do with $20 million or $30 million. We couldn’t think of what we would do with it.
VB: The Facebook panel at the Game Developers Conference was crowded.
Vechey: It’s the current trend right now. In casual games, it was multiplayer style. Now it’s Facebook. It will be virtual worlds. Our philosophy is to ignore things until we have a good idea. Until we do, it’s not exciting for us to go into it. Facebook would be a great platform and a great idea, but until we have the idea for the game, we won’t do it. There is a glut of applications on Facebook. I’m so sick of applications and Facebook.
VB: There are 140 Facebook applications a day going up.
Vechey: That’s crazy.
Roberts: How do you even get the word out? Scrabulous is the most successful game on Facebook but it’s a dud as far as casual games go.
VB: Since Scrabulous was made in India, do you feel game development can be done anywhere?
Vechey: Game development can be done anywhere. But we don’t believe there is cost savings. If we find a good Indian team, we hire them. The reason we are starting the China studio is not to save labor but to make games for that market. We aren’t going to be presumptuous. Our games are popular in China, and they’re mostly pirated. We aren’t going to work on games for China here.
VB: What business model works in China?
Vechey: You can do item purchases. The game itself may be free but you may purchase things to upgrade it. We are exploring all of the different things right now.
VB: There was talk at the GDC about how the try-and-buy downloadable model is tired.
Vechey: A lot of people talk about that. They’re right and wrong. It’s hard for mediocre games. The game has to be great. There needs to be more than just one model. We need ad models, subscription models. Saying try-and-buy is out is like saying no one is going to buy things in stores anymore because of the Internet.
VB: Is someone going to IPO in this space?
Roberts: Someone will. Companies like Goldman Sachs are betting on it.
VB: What do you think of licensing brands?
Vechey: We don’t like it for us. It’s not a bad business model. But it’s not worth it for the licensing fee.
VB: What could go wrong for PopCap?
Vechey: World War III breaks out. We could grow too fast. There are a lot of people with a lot of opinions. Sometimes we can’t move as fast. It’s a challenge for the company. I can’t just arbitrarily do things. I don’t know everyone anymore. I worry about the commoditization of games. Casual games have a chance to bring games to everyone. It’s like movies when they were young. In 20 or 30 years, everyone will have a favorite game. In casual games, are we a blip? Or is that our future? Will we make the same mistakes?
VB: What’s your idea of heaven?
Vechey: World peace.
VB: World domination?
Vechey: We could have peace then. For us, it’s continuing to make great games. Have fun.
Roberts: I think when everyone has a favorite game. That’s heaven. Most of our customers are women over 30. We’re getting there. We have barely scratched the surface of getting the whole population to see themselves playing games. Most of our rabid customers don’t call themselves video gamers.
Vechey: I want the most addictive game ever. I don’t know what it is. We want to make it.
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