aram and I are presenting at next week's OMMA conference, and as part of that, we've also been preparing an article for mediapost. we'll be speaking on two interrelated topics - a panel on in-game advertising and a presentation on branded entertainment. as part of our preparation we've been interviewing companies in these spaces, as well as some tangential organizations that have a vested interest in how these issues play out, such as the WGA and talent agency UTA. While the topic of branded entertainment is vast, our audience will primarily be interactive planners and buyers, so its a natural that we've gravitated towards investigating gaming. I dont want to cannibalize our article, so you'll have to read mediapost to read out words of wisdom there, but I would like to post briefly on what we didn't include due to space constraints.
the first thing that struck me about the video game industry is how closely it resembles the studio system in hollywood in the 30s and 40s. its a rapidly consolidating industry that is increasingly vertically integrating, with spiralling development, distribution and marketing costs. The video game isn't quite as vertically integrated as the major studios of the 1930s, who not only owned the studios, the theater chains and the real estate the lots were located on, they also "owned" the talent as well. It resembles the studio system in another way, or more precisely, the beginning of the end of the studio system: talent, feeling mistreated, is increasingly seeking greater independence and agency. and the talent agencies have not ignored that fact - a conversation with UTA revealed they represent both companies looking for funding and individual talent who presumably will become "names" akin to auteur theory in film.
Yet, while the video game industry is moving closer in terms of structure to the film industry, the film (and tv and music) industries are moving towards a video game paradigm in several important respects.
first and most importantly, greater interactivity in these industries. we're talking about remixes, mashups, interactive TV - all the ways that formerly staid genres are becoming shaken up by greater consumer control.
second, producers in those genres are beginning to understand the value of a dedicated, proselytizing fan base. the video game market has long benefitted from a rabid fan base and has actively courted them. the film and tv industries are just learning how to effectively harness this group - some clumsily, some quite smartly.
third, and this one is a little more complicated - but video games face an economic quandary - development costs have been rising but game publishers cannot raise prices - the higher the game price, the less it sells. game publishers have been actively embracing online distribution to offset development costs. meanwhile, the film, tv, and music industries have been wary of digital distribution (to put it kindly). they've only just begun to explore the possibilities of online distribution. obviously, these are ideas that are still being hashed out (hopefully in enough time to present some of them on tues) and perhaps in some future papers?...