Breaking Open The Global Games’ Cabinet
When we weren’t looking, the game industry grew up.
What if I told you that the most expensive product to hit the entertainment market, in recent years, made back all it’s earnings and then some in a single day? What if I said it cost $265 million to make? (“$265 million,” is a bit underwhelming; perhaps $265,000,000, in all of its 9-figure glory, helps provide a clearer picture of the financial situation and adds a little punch to it). Now, what if I claimed that this product made a profit, drew in over $1 billion (that’s $1,000,000,000 with 10-figures) in sales in only three days? Would it be so hard to believe? The product? Rockstar North’s, Grand Theft Auto V, and publisher Take Two Interactive affirmed, in their 2014 fiscal year report, that nearly 33 million units (33,000,000 physical and digital copies) had shipped at the time.1 If you’d like to be generous, placing each copy at $60 retail price without considering sales, that’s an estimated value of $1.98 billion ($1,980,000,000) copies of Grand Theft Auto V being sold and that is in no way a small amount. As the business website, Motley Fool, places the scenario squarely into perspective: “To put the games sales into context across other forms of entertainment, the global music industry sees less than $1.4 billion in record and song sales each month.” In other words, this one game has outpaced the entire music industry in just a few short days.
That is the amount American consumers alone, in the last year, have spent on video game affiliated content, accessories, software and hardware.2 The amount being spent encroaches on a scale of spending that’s hard to understand and is often understated in the sheer immensity of money being moved. For all it’s worth, the industry remains a pie worth slicing into, given that it has the chance to be taken seriously in America, as it is in the East Asian countries. Any industry large enough to enter the global market, is one worth improving upon and learning from, especially one that has grown as quickly and as successfully as the video game industry. There is the capability to open up the market as a truly cohesive, global environment, not much unlike that of the technology industry, with a variety of companies finding merit in oversea connections and opportunities. The convenience of mobile gaming worldwide has tightened the bond between Silicon Valley, in the United States, and the video game developers worldwide, through Google Play and the iOS App Store. The increasingly costly expenses used to create big budget video games have had ill-tended consequences in the long run for companies, spurring the mobile and independent (otherwise known as “indie”) game sectors into action, making gaming mainstream and accessible to a larger population. The growing profits of recent years have also increased the amount being invested in the industry — e-Sports has long been recognized as a legitimate pastime in East Asia and only now are American corporates acknowledging and tapping into this “new”pocket of business seriously. The gaming industry has left its adolescence long ago — it has finally become a matured part of worldwide entertainment. It is about time it is recognized and treated as such.
Grand Theft Auto V is representative of the entire corporate business section in the video game industry, with large teams, a huge budget, and a large, hopefully positive, return, AAA video game development has been in the works for the longest time. Activision, another video game publisher, has even set aside a $500 million ($500,000,000) budget for their late 2014 video game, Destiny.3 Polished games simply cost more money to make because they need more time, require more manpower, and are genuinely enormous projects taken on by these corporate companies. The increasing amount of sophistication behind the scenes baffles, as voice actors are hired, games are tested and reworked as requested, artists are enlisted, programmers are programmed — the list is endless as the amount of improvements to be tagged on to the end of these products are endless. These AAA video game companies represents the Hollywood equivalent of the game industry — these are the high standards. Yet with great investment comes great responsibility, and the out-pouring of wealth into companies worldwide have rooted innovation across the larger corporate product lines riddled with sequels, rehashes, remasters, and reboots. It’s made the bigger companies within the industry — the ones making a larger share of the profits — play it safe among the risks.
AAA development, worldwide, is no longer taking center stage as the industry enters an era of mobile and indie gaming. Candy Crush and Clash of Clans provides the clearest examples in America of the move to mobile in recent years. Mobile gaming is simply a matter of convenience — the average user is more likely to own a smartphone over a dedicated handheld or personal home console. Even in Japan, spending on mobile gaming has even exceeded that of America.4 Despite this new development in mobile gaming, Nintendo and other large companies continue to thrive off of the exclusivity of their products. They require their customers to purchase their hardware in order to play their games, aiding the survival of the console despite the convenience of mobile and computer gaming. However, they are no longer par for the course: mobile gaming has made gaming mainstream, transforming demographics and breaking the stereotypes of the normal gamer.
In fact, China remains the first in the world for Massively-Multiplayer Online (MMO) gamers at around 129.2 million (or 129,200,000) people — around 73% of all of China’s gamers. In the last two years, China has become third in iPhone and iPad spending, no doubt to the joy of product mobile device makers Apple, based in America. Only the United States and the United Kingdom spend more on applications on the iPad and China spends more than the United Kingdom on the iPhone, yet, is still outmatched by Japan and the United States on that account.5 The growth of the mobile and online gaming sector in China is most likely a controlled result — China has only recently lifted the ban on consoles, leaving computer games and mobile devices as the only options for gamers. According to Reuters, more than 70% of gamers in China earn less than an equivalent of $634 a month. The average cost of console video games are around an unaffordable $60 for gamers in China; the allure of free-to-play games on mobile and online browser games ineffably draws more gamers and continues to do so today. As an aside, despite the ban on the commercial sale of consoles only being lifted, just recently, China based manufacturer Foxconn has been responsible for the fabrication and export of Sony, Nintendo, and Microsoft’s devices.6 The state of affairs in gaming for China, clearly exude a different sense of industry priority than in America — the money simply isn’t being returned in China like it is for America. The average buyer in America is 37 years of age and with an average of 155 million who play video games (155,000,000 people), gamers simply don’t face the same obstacles such as the expenses of console gaming as gamers in China do.7
Unlike that of China, South Korea retains an avid console user-base despite also maintaining its highly enthusiastic levels of online gamers. Following the global launch of the Playstation 4 (PS4), South Korea’s later, delayed, the amount of interest and resulting sales were large and varied due to the demand for the PS4 — there had not been, “a new stationary video game device,” released in South Korea for more than seven years, according to the 2014 White Paper on Korean Games released by the Korea Creative Content Agency.8. South Korean mobile and online games have also performed well in the last year, increasing their market share in foreign bodies. The NCSoft developed MMORPG known as Blade and Soul has had work being localized for Chinese audiences and Com2us mobile game Fishing God maintained a position among the top ten popular games on the Apple App Store in 71 countries after its release.9
South Korea has a population that’s exceptionally literate and technologically savvy, a perfect compliment to the increasing needs of the online game market that considers video gaming a professional sport. A leading member of competitive professional gaming, known as e-Sports, South Korean gamers are known for their invested time and money in games such as StarCraft and League of Legends. South Korea’s online gaming industry is a direct result of Korea’s widespread adoption of a complete broadband infrastructure. While also being a major contributor to the e-Sports community, South Korea’s home to developers, such as the previously mentioned NCSoft, that have been able to consistently, “outperform major competitors including Electronic Arts (EA)…Nintendo and Sony.”10 This performance over foreign companies coupled with the historical tension between Korea and Japan, have actually reinforced South Korean-based video games. The lift of the ban on consoles from Japan in 2001 would mean a slow phasing of the consoles into the Korean market; the West had no major consoles to rival until the XBox and at that time the Playstation 2 was first being launched officially and legally in South Korea.11 This left only one direction, at the time, for South Korea’s game industry to head — online gaming. With the enthusiasm alongside the strong internet service in South Korea, came the birth of the PC Bang (방, pronounced “bang” means “room”).12 The PC Bang is a Korean internet cafe, usually with up to date hardware, software, and a great internet connection. Comparatively, the price to use one of these centers cherished by gamers is around $1.
But is the games industry really that important? While the games themselves might be mere child’s play, there’s a number of reasonings that express the sheer significance this industry has in the larger scheme of things. The industry has provided two things during its growth over the past few years: first, it has made incredible contributions to the United States’ Gross Domestic Product (GDP) adding nearly $6.2 billion ($6,200,000,000) in 2012, and, second, the industry has provided an invaluable amount of employment opportunities across 36 different states. The returns don’t stop there — employing nearly 146,000 people with an average compensation for direct employees at around $95,000, the industry provides a total national compensation of more than $4 billion ($4,000,000,000) to its many employees.13 Tax incentives provided to big companies such as Electronic Arts (commonly abbreviated as EA), have shown that Uncle Sam’s taken notice of the lucrative business and cash flow the industry has brought to America.14 If the United States’ video games industry is representative of the rest of world, these are some sure signs that these are money-making juggernauts no matter where you look in the world.
Alright, it might be a lucrative business, but aren’t the video games of today violent and harmful to the kids? Well, games like Destiny, Grand Theft Auto, and Call of Duty are indeed top-selling and violent to the point of worry, but, fret not, as there is no link between violent video games and violence being replicated by children.15 Study after study has been made counteracting this myth and it’s widely accepted by authorities world-wide that violent content in video games has no more of a link to violence in reality than violent films do. That is to say, there is no link at all. In addition to this, according to the Entertainment Software Association (ESA), alongside the Entertainment Software Rating Board (ESRB) ratings, “the industry has also voluntarily established numerous tools and policies to help parents make educated choices and ensure that retailers only sell games to those whose age is appropriate for the game in question.”16 It would be wrong, however, to claim that there are no risks associated with video games. Perhaps, as with any hobby, there is always the risk of becoming too attached — addicted — to the medium. South Korea has taken serious steps in recent years to protect their youth, creating legislation regarding curfews, blocking people under a certain age from playing into the late nights.
In an interesting twist, there is an estimated 10% of South Korean schoolchildren who have shown signs of video-game addiction, “thought by some psychiatrists to be one of the highest rates in the world, along with that of China.”17 Despite this, perhaps as a result of video games consistently being ridiculed in American culture, video-game addiction is not officially recognized by the American Psychological Association. South Korea had taken it a step farther, opening the first Internet- and video game-addiction treatment centers, paving the way for hundreds of other hospitals and clinics to treat the disorder. Despite the similarities in symptoms affecting those with a serious video-game obsession and those with traditional addictions, it’s said to affect only a small minority of the gaming population which might be a relief for those in support of video games.18 Yet, for those who are affected, video-game addiction isn’t taken seriously in the Western world, and even in East Asia, are there limited options for support.
Contrary to the recurring myths that video games are bad, there are signs that they may actually be aiding players with a variety of cognitive functions. A study undertaken at Brown university, “suggests that gamers may have a more efficient process for hardwiring their visual task learning than non-gamers.”19 These are findings that apply to the industry world-wide — and gamers make up an astounding amount of the populace. In 2013, it was reported that more than 1.2 billion people were playing games worldwide (that’s 1,200,000,000 little humans twiddling their thumbs and tapping their screens).20 Despite the associated risks and rewards with gaming, there are 1.2 billion people of all genders and ages playing video games — women aged 35 and older are consistently outnumbering their male counterparts according to a report by Netherlands’ based Spil Games.21
Gaming is no longer a niche hobby held by a few enthusiasts stocking their cabinets full with old consoles, dusty cartridges, and few regrets. From the commuter playing upon their smartphones, to the e-Sport athlete partaking in competitive play, both are contributing to this worldwide industry that has shouldered a hefty amount of responsibility for things good and bad. While the United States and Japan definitely have a strong user base in console gaming, in China, Korea, Japan, and the States, there is a steady and large foundation in mobile and online gaming. From tax breaks, to importation limits, to regulations of the pass time, it is clear that the governments have vested interests in managing the video game industry in manners that prove safe to their people and beneficial to their respective economies. It is no longer the age of arcade cabinets and 25¢ gaming exploits; the aged stigmas surrounding video games should be considered as such and left in the past. Video games have matured while we weren’t looking.
1Thier, David. “’Grand Theft Auto 5' Has Sold Nearly $2 Billion.” Forbes. Forbes Magazine, 13 May 2014. Web. 08 June 2015.
2Entertainment Software Association, comp. “Essential Facts about the Computer and Video Game Industry.” (n.d.): n. pag. 2014. Web. 7 June 2015.
3The Economist. “Why Video Games Are so Expensive to Develop.” The Economist. The Economist Newspaper, 24 Sept. 2014. Web. 08 June 2015.
4Usher, William. “Japan Surpasses America In Mobile Game Spending.” CinemaBlend. CinemaBlend, 21 Sept. 2013. Web. 08 June 2015.
5McDonald, Emma. “Infographic: The Chinese Games Market.” Newzoo. Newzoo, 12 Dec. 2013. Web. 08 June 2015.
6Carsten, Paul. “China Suspends Ban on Video Game Consoles after More than a Decade.” Reuters. Thomson Reuters, 07 Jan. 2014. Web. 08 June 2015.
7Entertainment Software Association, comp. “Essential Facts about the Computer and Video Game Industry.” (n.d.): n. pag. 2014. Web. 7 June 2015.
8Korea Creative Content Agency. 2014 White Paper on Korean Games. N.p.: 길잡이미디어, 2014. 길잡이미디어, 2014. Web. 8 June 2015. (pg. 22)
9Ibid (pg. 21)
10Hjorth, Larissa, and Dean Chan. Gaming Cultures and Place in Asia-Pacific. New York: Routledge, 2009. Print. (pg. 19)
11Rumas, Nick. “The State Of Korea: Console Games.” Gamasutra Article. Gamasutra, 14 Aug. 2007. Web. 08 June 2015.
12"Bang! Bang! Bang!” Bang! Bang! Bang! Visit Korea, n.d. Web. 08 June 2015.
13Entertainment Software Association. “Games: Improving the Economy.” (n.d.): n. pag. 2014. Web. 8 June 2015.
14Kocieniewski, David. “Rich Tax Breaks Bolster Makers of Video Games.” The New York Times. The New York Times, 10 Sept. 2011. Web. 08 June 2015.
15Kain, Erik. “The Top Ten Best-Selling Video Games Of 2014.” Forbes. Forbes Magazine, 19 Jan. 2015. Web. 08 June 2015.
16Entertainment Software Association. “Essential Facts about Games and Violence.” (n.d.): n. pag. Web. 8 June 2015.
17Cain, Geoffrey. “South Korea Cracks Down on Gaming Addiction.” Time. Time Inc., 20 Apr. 2010. Web. 08 June 2015.
18BBC News. “S Korean Dies after Games Session.” BBC News. BBC, 10 Aug. 2005. Web. 08 June 2015.
19Orenstein, David. “Score! Video Gamers May Learn Visual Tasks More Quickly.” Brown University. Brown University, 31 Mar. 2015. Web. 08 June 2015.
20Takahashi, Dean. “More than 1.2 Billion People Are Playing games.” VentureBeat. VentureBeat, 25 Nov. 2013. Web. 08 June 2015.
21SpilGames. “State Of Online Gaming Report.” (n.d.): n. pag. SpilGames. SpilGames, 25 Nov. 2013. Web. 8 June 2015. <http://auth-83051f68-ec6c-44e0-afe5-bd8902acff57.cdn.spilcloud.com/v1/archives/1384952861.25_State_of_Gaming_2013_US_FINAL.pdf>.
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