Monday, November 17, 2008

PC is the 'Cradle of Innovation,' says Microsoft

Microsoft is a big believer in PC gaming and the company intends for Games for Windows to lead the way. Eventually G4W will launch full digital distribution a la Steam, Microsoft's Michael Wolf tells us.

by James Brightman on Friday, November 14, 2008

Interview: PC is the 'Cradle of Innovation,' says Microsoft

For years now, people have been talking about the "decline" of PC gaming, and while it's true that retail sales have dropped off, the PC gaming market as a whole is quite strong. In fact, U.S. online PC games revenue is expected to grow from $3.5 billion in 2008 to nearly $15 billion by 2012, according to IDC, and PC game sales will likely continue to shift to online channels, including subscriptions and paid downloads.

We recently sat down with Games for Windows - Live Senior Marketing Manager Michael Wolf in advance of the Games for Windows – Live overhaul to get Microsoft's take on how Games for Windows is evolving and impacting the health of the PC gaming market.

Perhaps the biggest hurdle for the PC gaming market (at least on the retail side) is piracy. Some developers that used to be PC-only have all but abandoned the PC and many have blamed the rampant piracy. Epic Games has already said they won't bring Gears of War 2 to the PC for this very reason. On top of that, consumers are increasingly irritated by DRM solutions that are forced on them (see EA's Spore controversy). So what is Microsoft going to do to alleviate these problems?

"I believe the PC is the cradle of innovation; there's always new things happening on the PC."

"We're looking into it and trying to provide the best guidance and technologies as we can," said Wolf. "Specific to Games for Windows – Live, I think for Live enabled titles you're going to see a little bit of a difference with games and piracy because in order to connect to Live – we do validation checks – if you have a pirated version you won't be able to connect to Live and then you can't play multiplayer, can't earn achievements, etc. We know that's something that's incredibly valuable to gamers... So I think people are going to be more likely to go out and buy the game. I don't think it's going to stop it completely because piracy has been around forever, but it's a step in the right direction.

"As far as Cliff's [Bleszinski] comments [about not bringing Gears 2 to PC], I think that there are certain games that lend themselves to consoles and certain games that lend themselves to PCs, and we're certainly not going to demand that developers do one or the other, but there's just as many games that are PC exclusive that aren't coming to console. So clearly there's money to be had there. The PCGA recently came out with the Horizons report, which showed that the money going into the Windows gaming industry is huge. Windows gaming is making almost as much money as all the consoles combined. It was worth something like $10 billion in 2007. Clearly, there's a very strong market for PC gaming. ... The PC gaming industry is not in decline; it's evolving and it's definitely evolving to a more online market. I believe the PC is the cradle of innovation; there's always new things happening on the PC."

The PC gaming market may be moving more and more online, but the games industry as a whole is still largely dominated by retail. That said, game companies don't appear to be as concerned with "ruffling the feathers" of their retail partners as they take their products online and distribute digitally. "I think retailers are starting to get it," Wolf said. "Even when we look at what Microsoft has done with digital distribution and how we worked with retailers... it's almost like the same people who said books are going away and magazines are going away because everybody gets stuff online. I think there's still going to be that market where people want to go out and buy hard boxed copies and collector's editions and things like that. Things like that are still going to drive people to retail and even when it comes to digital distribution Microsoft sells points cards at retail, and the retailers love that. So I don't think it's necessarily cutting out retailers or that we're getting a lot of pushback from them."

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Jason Kiwaluk

Mower & Shoveller,

Ideation | Ecommerce | Fintech | Innovation | Strategy | Opinionated Agitator RevenueWire,FuturePay+PayMotion

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