Zynga are to break away from Facebook and set up their own games portal. Lady Gaga, who hit 20 million followers on Twitter, is set to release her own social networking site. Double Fine games breaking away from the normal pathways of funding and setting up their successful crowdsourcing project on Kickstarter.
All three are symptomatic of one thing – overgrowth.
You see, the problem isn’t in the success stories of Double Fine, Lady Gaga or Zynga. They have used their time in the correct channels to garner a large amount of support, a large following of people who spend their money on them. But success is growth – growth is the sign of a healthy market.
And like any plant, when a fruit has grown too large, it drops off the tree. It seeks to set new roots elsewhere, to create its own fruit. This is natural, and normal, and the wonderful process of evolution and progress. That’s how the world is, and how it has been.
There are dangers though. If the fruit doesn’t fall far from the tree, then it has to compete with the tree that gave it life – and this is where things can get ugly, and rarely does it end well.
Lady Gaga is a wonderful woman I’ll grant you, but to set up her own social networking site off the back of her Facebook and Twitter followers means she will directly compete with them. Zynga, who have made Facebook millions of dollars over the years, will compete with Facebook and a variety of other established portals – including free and budget ones like Armor Games. Double Fine have crowdsourced millions, but others who are attempting this now are finding the market harder to get money from – and Double Fine have also run the dangerous risk of alienating and insinuating against the traditional funding sources, and they may never find a way back from here.
Competition is a strange beast. Survival of the fittest, although in this market it is usually “Survival of the Fattest Wallet”. Lady Gaga will have to invest heavily in new software and code for her venture, and she will find Facebook and Twitter may not be so fond of her advertising her new venture through them. Zynga will have to stand up and be counted without Facebook, exposed to the world for what they are and what they do without being able to hide behind the branches provided by Facebook. Double Fine will have success on this one adventure game – but where then? Will they always crowdsource? And have they burned too many bridges to go back to traditional funding sources?
All these, and many more, will struggle. The market isn’t growing, it’s fragmenting – it’s splitting everything into smaller chunks, branded by various people who want a slice of the pie. The newcomers will have to invest heavily in their own slice of the market – to tend and nurse their roots in a hostile environment, whereas those already firmly rooted will have to compete for its share of the ground against the seeds it has produced. None of this can end well. There will be a loser. There will be one who is stunted in the process.
For you see, despite the reality that there may be enough market for everyone, investors and business people operate like this is Highlander. “There can be only one!” is their battle cry, desperate to be the new top dog in the world, blinded that there are acres of open ground in which they can set their roots.
It is a world, a market, the way of things currently that those breaking off from the industries they have grown fat from can only attempt to mimic them, to do what they do and try to do it better, but mostly do it because there is a name attached to it. Gaga. Facebook. Schafer. Names we know. Names we recognise.
But it may not be enough for their survival, and some will falter and stumble. Because that’s how it works – the market is brutal, and savage, and unforgiving. Look at GAME, who burned their bridges with suppliers and publishers, and now face administration because they simply can’t actually buy stock from these people – they want up-front costs, not credit, and they charge MORE for this because they don’t trust them to prioritise their new products over their extensive second-hand catalogue.
Failure means no second chances. Reputations are on the line, as well as millions of dollars worth of investment and money from public and private purses.
The games industry itself has grown fat, and struggles to move from the past. And Valve walk in, proposing a new console with a new firmware and new ideals – to not charge licencing fees for games to be sold on its system – and it shakes things up, and sees if it can dislodge anything from their positions. Four consoles in a market is too much. The industry has never seen more than three home consoles at a time, and the risk is a fourth may shrink the market. Valve’s gamble is without licencing, they can rob the lifeblood – the games – from one of their rivals, and take their place.
No mercy. No respect. No compassion. When things get crowded, and overgrown, something has to give, and die, to be replaced with the new shoots. Valve obviously know this. I’m sure they smell blood, with Sony deeply in debt and Microsoft still fiddling with their next machine. Nintendo may be a tougher fight, as Nintendo sell on games alone too – and Nintendo have and indeed, own the games to back it up, but it would still be a brutal challenge to their dominance with no guarantee of success either way. Microsoft and Sony rely largely on third party support and exclusivity, which could be robbed from them if costs are lower on Valve’s box.
Everything changes, and the world marches on. But with so much out there, so much room, so many ideas and concepts, it seems strange that we all at the end of the day believe it would be better if there were only one dominant force in the market. If we had no choices. Just one place to go.
Except that’s when it gets more dangerous as well, because one contamination and the whole plant dies, spoiling the ground around it so that others cannot replace them.
Competition is a great thing for us – it changes, it forces companies to adapt. But this fragmentation is not merely for competition – it is for greed, plain and simple, and from the earliest stages, they are nurtured by greed, for greed. Valve are successful. Double Fine are. Lady Gaga is. Zynga is. They make sums of money beyond our wildest dreams.
What they want, simply, is to stand out and hog the limelight, even when it robs their predecessors of that light. To make more money. Be more famous. More column inches, more dollars per second.
But its a dangerous method, and one that has no guarantee of success. Because if it were guaranteed, we’d all do it.
It will be hard on many, but there are spaces out there and new ideas and open acres to set up shop. If you lay it too close to the already-established, then prepare for a fight.
And whoever wins, we – the consumers – will be the ones who lose.