Project Cafe Speculation

Since we're a couple days away from Nintendo's presser at E3, I'm calling last chance to speculate on what Nintendo has up their sleeves with "Project Cafe" that hasn't already been leaked.

The most fervent rumor discussion is around the controller, which is supposed to be some kind of tablet with a 6 inch screen, buttons and a d-pad on the side, and tilt sensors and the like.

Anyhow, here's my prediction:

- Nintendo will claim the controller can also play stand-alone games.

- They will position the controller as being a "tablet that comes free with your console" and will show some entertainment functions for it

- The 'comes free' is a bit of a ruse, as buying a second controller will have a hefty price tag

- They will put on a brave face about the 3DS and that business being alive and well

Over time, though, I believe they see the writing on the wall about their hand-held businesses being commoditize and subsumed by phones and tablets, and so this is their attempt to in turn commoditize those businesses. I think its a weak attempt to do so, but there's some logic to the strategy and should allow them to circle the wagons with their core base.

It'll be interesting to see whether Nintendo can pull off yet another hail-mary pass (like they did with the Wii and the DS).

Protesting Pachter's iPod Publisher Plea

Michael Pachter is normally a pretty rational guy as far as analysts go. However, I found his quotes in this piece on GamesIndustry.Biz to be strangely off the mark.

In the piece, Pachter claims that publishers are at risk of spoiling their own party, so to speak, by publishing games on iPhone and iPod Touch at prices lower than those they command on other platforms. He states,

"Putting well established franchises such as Madden on the iPod Touch for USD 10 cheapens their value, he explained. "Whether it's the same experience or not, and it's not, why would I ever spend USD 60 for Madden if I can get it for USD 10 on my iPod Touch?"

He goes on to state that this contributes to the risk of the iPod Touch displacing the DS (and one would assume PSP as well),

"It's a serious threat to pricing. And once people start to look at this as a substitute for the DS for smaller kids, for 12 and unders, then you're going to train a whole generation of 12 and unders that this is a perfectly acceptable gaming experience at that low price point."

I believe his line of thinking here is seriously flawed. I beleive this for three reasons:

1. Different platforms merit different pricing. I'm surprised at the first quote. Madden on PSP today retails for under $40, vs $60 on PS3 or 360. By his line of thinking, why would anyone buy the $60 version? The reasons are that the experiences *are* different, the consumer may own a particular platform and not be swayed to another for an individual title, and the economics of each platform is different (dev cost, distribution costs, etc). To take it to the extreme, There's a version of Prince of Persia on cell phones that doesn't go far in displacing the $60 console version, despite selling only for a couple dollars.
2. Meritocracy in the market. Pachter seems to claim that kids playing on an iPod touch won't 'move up' to other platforms as the previous generation did from GBA to DS/PSP/Home consoles. First, I'm not sure this platform graduation is anything but myth. If true though, the reason the gamers would 'move up' is because the next platform would offer a higher quality experience and or different content to suit their changing tastes. If other handhelds, or home consoles for that matter, can't offer a superior experience to the Ipod Touch, then they will fail - and should fail. On the other hand, if they do offer a superior experience, then they should be able to charge for it. If Nintendo or Sony can't compete on their own merits, it's not up to EA to prop them up - and if they do, then they should be compensated in a way that lets them lower the price of titles to better compete.
3. No man, nor publisher, is an island. The Appstore, while not an open platform*, is certainly more open than the controlled, curated, catalog of titles available for handhelds. What that leads to is the tens of thousands of apps that we've seen show up on it, and I'm not sure that any publisher, even EA, refusing to publish on it is going to make any difference whatsoever. [I suppose that a cartel of publishers could agree in unison to boycott the platform, hoping that absence of ANY big-name content would poison consumer interest in the device. This has happened in the past with things like music labels boycotting Napster, or (IIRC) movie studios with betamax - however, its legality is questionable, the games publishers aren't organized in such a fashion, and there's enough of an indie community that I don't think this would work anyway]. In any case, the publishers seem to be faring fine while still charging a premium for their IP (see the top grossing list)

I guess what has me so bent out of shape is that it sounds so much like the death knells of the music industry. "$0.99 downloads will kill us all! What will become of our glorious CDs?"

People kept making music. People are going to keep making games. Whether to adapt to change is up to you, but don't expect the market not to change because you don't like the way it's changing.

Make excuses or make money, your call.

On EA's numbers...

A number of people have linked to Gamasutra's look at EA's quarterly results. The eye-catching factoids causing the linkage are (1) the significance of GameStop as their largest retail customer, and (2) that the Xbox360 SKUs were responsible for the lion's share of their revenue (218M, or roughly half of their revenue, the closest other platform being the PS2 at 73M).

It's certainly good information to hear for Microsoft, but it still leaves questions unanswered for me. I'd be very curious to know what the same set of numbers looks like in terms of margin per platform. My guess would be that the DS would one of the top slots on the list. Also, I'm curious if this is indicative of a long-term trend, or if it was offset this particular quarter by any big software releases.

Robin's Sims

Robin's game project, MySims, has been announced, and it looks totally sweet. Like syrupy sweet. It looks like everything is made of candy!

I know a game like this has a huge number of people on it, all contributing, but I have to say that I've never seen a game that just oozed one person's personality as much as this one does. Coincidence? Perhaps.

Either way I'm super happy for her and her team and am looking forward to playing it (might have to buy that Wii or DS after all. Have been holding out so far)