Analytic Dreamz: Notorious Mass Effect - "PREVIOUS PLAYSTATION CEO WARNS OF FURTHER LAYOFFS, CITING UNSUSTAINABILITY IN AAA DEVELOPMENT EXPANSION"

Episode Date: February 3, 2024

Linktree: https://linktr.ee/AnalyticIn this segment of Notorious Mass Effect, we discuss former Sony Head Shawn Layden's comments on the unsustainability of AAA game development. Layden responded to a fan on Twitter who expressed concerns about the industry's financial practices, stating that he expects to hear more about this topic in 2024.This is a timely and important topic, as the gaming industry continues to grow and evolve. With rising development costs and increasing competition, it is becoming increasingly difficult for studios to produce profitable AAA games. Layden's comments suggest that this is a problem that is only going to get worse, and that the industry needs to find new ways to make games that are both high-quality and financially viable.This segment of Notorious Mass Effect is sure to spark a lively discussion among gamers and industry professionals alike. We will explore the challenges facing AAA game development, and discuss possible solutions. Layden shares his insights on this important topic.Privacy & Opt-Out: https://redcircle.com/privacy

So with that being said, of course, let's get into the topic at hand, which is a lot of business talk when it comes to just the gaming space in general. But more specifically, PlayStation executive Sean Layden believes that the trend of big open world games is leading to unsustainable budgets in the gaming industry. Now, before I go any further in the details, because he said a lot. but I would like to let y'all know that technically if the gaming studios unlike the movie studios I would argue and debate that gamers have more backlog than any form of entertainment in the history of mankind maybe you can make an argument for music but as far as video games and the amount of hours you can spend on a video game I think that if gaming companies try to make certain games more expensive just because of the length and the runtime, well, same thing, we could easily boycott and just play the games in our backlog.

Like, I would be more than happy to go back to a remaster version of Super Mario 64, right? So with that being said, obviously, Layden has suggested that industry needs to, reevaluate game development, which honestly, I think that's been a reoccurring theme throughout the past two to three years. I don't know if it's the pandemic that brought it up more, but now people are just starting to try to put a label on these long video games and call them live services to the point where even if you charge $70 in the base game, they still try to hit you with a roadmap to make you pay extra for content that should have already been in a game. So with the advances in technology, things are getting more expensive to make video games.

I mean, whether you have a coder, whether you have game testers, the developers, of course, what else? The actors, the voice actors, the anime. It's just so much stuff that goes into building. a sustainable budget for a video game. So that is why I think it's interesting that one of the biggest at doing it is coming out and saying that basically the reevaluation needs to happen. And because of the increase in game developing and marketing budgets,

they need to be matched with an accurate price or a fair price. or a fair price. The thing I say to that is, on one hand, the consumer-friendly me wants to be like, I don't know what you're talking about. Like, obviously, you know, games could be expensive or whatnot, but don't raise the price or we can easily boycott. Then on the other hand, devil advocate,

I completely understand what this man is coming from. Because if you look at the gaming space from the beginning, beginning of time to now, and then you look at the price from the beginning of time to now, one could argue that gang devs and companies have had the most backwards and barbaric approach to pricing their product. And who is to blame for that? I mean, they say the development cost for AAA games range from $80 million to $150 million. And basically, this is historic. It's not even close to what they used to be in the past. Basically, this is at a point where they're reaching new heights when it comes to AAA game

development. So since development cost is what it is, I think they need to try to make it back some type of way, right? So the devil advocate take would be that obviously it makes sense to increase the price. because the product is obviously increasing. Gaming industry is the only space where you can increase the product and then the price stays the same for, what, over half a decade to a decade now. And I mean, they literally just raised the original game price from $60 to $70. And I think back in the day when game exchange, I think that was the right,

I think that's the right story, game exchange, game stop, things of that nature. I think even Blockbuster, well, that's when you rent at games. So, yeah, like game exchange, game stop. Those are the only places to where the price and games fluctuated based on the popularity. I don't know when it started, but I was just listening to somebody cover the industry for a while. He was going over this point. So it's not my own, but this is how he framed it. He basically said it was a certain game that happened to where all games started to be priced at $60.

But it didn't used to be that way. It used to be whatever the developers thought was a fair price for the product they was putting out. So I blame the gaming industry. I blame the game devs. And I attribute to the W to gamers. I mean, it's okay to just say that, hey, maybe the consumer won and we just need to reevaluate, which is basically what Sean Layden is saying. He's saying that these development costs for games are getting,

exponentially larger and we got to see some type of return on our investment. And basically also, which is very interesting being as a PlayStation executive, suggested that game developers focus on shorter games with tighter, more compelling content to control cost and maintain retail prices. What does that scream to me? They're trying to cut back on the content. I mean, if Spider-Man 2 wasn't a inclination, a perfect, a picture, perfect layout of what PlayStation is trying to do, then I don't know what it is.

They literally, and, you know, I have no way to scientifically prove this. You know, I don't know this as a fact. But I believe that Insomniac was told by the higher ups that whatever the runtime is and the full game price has to be, has to correlate, right? We can't have 50 hours of play. time with a $70 price tag. Basically, we got to cap it at some point, which is why I think Spider-Man 2 ended up being literally around the same runtime as Spider-Man PS4. So I don't think it's a coincidence that the executive of PlayStation literally came out to say that other developers should focus on shorter games with more compelling content to control cost and maintain retail prices.

And this reminds me of when rock stars, I don't know if it was CEO, it was somebody during the earnings call said that he would suggest certain, he didn't suggest a pay per hour, but basically he looked at other industries because if you look at it from an entertainment standpoint, streaming services are a subscription base and you get a lot of content from that. um ESPN well any type of sports platform is subscription based things of that nature that's basically

what he was coming from I don't know where to pay from per hour came from but basically he was talking about a subscription model and you know who's implementing a model that I think is going to be here for the long run

Xbox with the game pass which is a subscription model so I think when you get into how the future of gaming is going to look, I don't even see us having the actual console in the next five to 10 years. I think it's going to be a cloud service where we download games, similar to Steam. You download games, you download it, you download it, you play it, and then it just, you know, it just stays in your backlog.

But as far as physical consoles, I think there's going to be a thing of the past, simply for the fact that I think the subscription model is the way to go for gaming. I mean, if they are going to keep complaining about. budgets being way more than a return on investment, then they're going to try to find some way to counteract that, which is a subscription model, I think. So Xbox is obviously ahead of the game with that. So it's super ironic and I think causing the fact that the former PlayStation executive is coming out to say this.

Usually if it was just some random gaming inside, I wouldn't cover it. But him being the former executive of PlayStation, probably means that he knows a little probably means that he knows a little bit that the average consumer or even the average developer does not know. So for him to come out and say that we need to stop giving consumers all this content

and cut back, which is basically what he means by saying that the trend of open world games is leading to unsustainable budgets. That's like in turn saying like cut back on the content because we're giving them way too much for the, a baseline price point.

So at the end of day, I think that this is going to be a reoccurring theme of game devs and especially executives coming out and trying to, I don't even think game devs because then I'll put a bad light if their product is bad, like video game. But as far as like console executive, well company executives, like a PlayStation

or Xbox, a Nintendo, I think we're going to see more executives speak up. And then I think we're going to obviously, we're going to see some obvious ripoffs of the game paths. I mean, PlayStation is already trying to do it. But for some reason, it's not as popular. But, hey, I don't know why. But for some reason, it's not as popular. So in the long run, in short, in my solution to what Sean Layden is saying,

I just think if he's so focused on runtime, compared to price point, they should just do a subscription model. And that's probably the most like anti-consumer take I'm going to give because if you're not playing games, let's say one month, but then you're playing, you're paying the subscription, then that means you're basically paying for nothing. But if you play a game, technically it's a $70 price point. So obviously it should correlate or be equivalent to. like seven months of of price point if that makes sense so um yeah that's all i have so the biggest

thing you need to know is that PlayStation is serious about cutting back on the content and not really trying to give you more than what you're actually quote-unquote paying for so anyways click my link to you in my bio let me know in one of my social medias what do you think about PlayStation executive sean laden coming out saying that these open world games need to end because they're leading to unsustainable budgets in the gaming industry. And what do you think is the ultimate solution to development costs for AAA games, historic rise in, yeah, that's basically it. What do you think about the development cost for AAA games, historic rise,

and breaking all type of records for development budgets?