There’s been much talk of the Loot Crate Controversy lately – with Belgium moving towards what seems like an outright ban (with Denmark and Sweden not far behind), the state of Hawaii in the US and Victoria in Australia also making sounds suggesting that legislation is needed to protect minors from “predatory” systems – love that word – and a general sense that the ESA and its attempt at a regulatory body, the ESRB, didn’t do nearly enough to protect the industry at large from the unbridled avarice of EA, Activision and WB Interactive. At least, enough that with regulatory bodies now hovering around the industry at large the ESRB and ESA themselves could soon very much be things of the past, screwing themselves out of a role in the industry by not taking a tough enough line on these “predatory systems”.
But I think people miss the underlying and perhaps meaty core of the discussion and it is one that I have a particular fascination with – the terminology itself of “Triple-A”.
After all, in investor terms, “Triple-A” is meant to be a sure-fire safe bet. It’s the kind of investment that is generally considered safe as houses – those assigned the financial ranking of “AAA” are those who borrow well and pay back on time and with interest, those who see good returns and profit margins and are considered solid, risk-free investments for your money. “Triple-A” was a term that didn’t really itself become a thing in video games until the dawn of Gen-7, where budgets began to increase and bigger games needed a marketing exercise that everybody could get behind – and one of the earliest examples I can find is, of course, from EA. The idea was laudable in its intent – to reassure investors that a game would be “a sure-fire thing”, and to reassure gamers themselves who were broaching the $50 price tag for the first time consistently that such games were worthy of their own monetary investment, as well as their time investment.
For a brief period – it worked, though in no small part that was down to the peculiar machinations of Gen-7 as a whole, which saw an explosion of interest across the board. With 280 million home consoles and 220 million handheld consoles (500 million hardware units overall), there was a huge and broad market of people and getting at least a million units was seen as the norm, a thing that people just expected, and for bigger brands with decent marketing – two to three million was certainly not unheard of.
However, the industry got ever more hungry and more ambitious, particularly with budgets and team sizes, and in many respects the industry over-indulged their own whims a tad too often, leading towards the end of Gen-7 with the likes of Square-Enix being “disappointed” that Tomb Raider ‘only’ sold 3.4 million units in its first four weeks on the market. EA and Activision and even Capcom and UbiSoft were soon to realise that when it came to video games, marketing their top-tier, big-budget level games as “Triple-A” was starting to appear on shaky ground. Games were not hitting their sales targets, and several controversies and PR disasters were to follow that further undermined the sanctity and security of the “Triple-A” title.
As Gen-8 started, the games industry saw a bit of a collapse – an awful year of content, a weak start by the Wii U and a slow uptake on the XBox One and even the PlayStation 4 showcased that the generational jump had not been as widely accepted as they had hoped, and numerous games from Assassin’s Creed: Unity to The Elder Scrolls Online, from Civilisation: Beyond Earth to Watch_Dogs and even Thief just pretty much bombed on the open market, and then Sony pushed through The Order: 1886 to showcase what a full body cringe is like in video game form.
And that doesn’t even begin to touch on the absolutely devastating PR nightmare that was GamerGate.
Video games weren’t “cool” anymore; and the wider market was deriding them once more as the bastions of lonely men who couldn’t get laid if their own lives depended on it. Sales predictions had to take a hit, and companies were increasingly aware that bloggers, journalists and even their own shareholders were starting to wake up to the growing realisation that “Triple-A”, in terms of a video game, was largely meaningless. Games were starting to make lesser returns, or were projected to make lesser returns thanks to a smaller, slow-growing market in the middle of a sociopolitical shitstorm of epic magnitude.
This is where the industry needed to find new ways of bringing in cash. It wasn’t simply, in my view anyway, about “profit” – though undoubtedly that was the consequence and as consequences go for a company that’s not exactly a bad one to end up with – but rather to keep an illusion going, the “Triple-A” illusion, the illusion that everything was fine and nothing was wrong and that you could still invest heavily in these companies and see a return.
It’s why huge season passes made an appearance – once a rarity reserved for when a game had proven its mettle, Season Passes became the de-facto first port of call to make additional cash, because you could in KickStarter terms promise vague and sweet nothings and deliver something, worse still because most Season Passes never bothered to say up-front what you’d get for your cash outlay. Then in came microtransactions, which allowed for basic in-game items even when they made bugger all sense, as WB Interactive proved with “Easy Fatalities” in Mortal Kombat X. It’s so hard to press pause, scroll to the right, and read the very simple fatality codes right there, isn’t it?
But Loot Crates were unquestionably where the industry saw the most profit potential, a limitless pool of random luck and chance where the player would not be guaranteed anything they wanted from their purchase – a self-sustaining ecosystem whereby they believed gamers would just continue to spend infinite amounts of their own money chasing down one elusive item or costume they desired from the system. Microtransactions you see have a limit – you get what you pay for, and it is at the least up-front about what you’re buying. Loot Crates, on the other hand? They don’t have to give you the odds, or anything you want or desire or even need. It’s a game of chance, a lottery-based system which only invites the player to throw increasingly large sums of money into a deep black pit where they don’t know how deep it goes.
Loot Crates, it seemed, were the final straw for gamers and regulators at large. With even gambling authorities and gaming commissions describing it as “a gambling exercise”, the games industry – desperate to maintain the facade of profit and monetary health – had moved into the line of sight of the political and social authorities, after years of obfuscation inside “the Grey Zone” of legal ambiguity.
In a sense, one person I spoke to recently who works in marketing and advertising – and video games included in that – said that many even in his segment had been convinced that the Triple-A industry had grown into a full-blown Ponzi Scheme in all but name – taking ever-increasing volumes of money from one group of people, that being the gamers, to pay the dividends necessary to maintain a decent level of investment and financial stability and growth that was essential for a publicly traded company to keep face. And as the volume of cash needed to balance the books grew ever greater, the need to pull more cash from gamers to pay the investors and financiers became ever greater and more desperate.
It’s an extreme accusation, but I think it’s worthy of mentioning if only because it echoes sentiments that gamers have been saying for the last couple of years. I don’t think it was as outright criminal as that suggestion may suggest it is – but it was certainly not going to be sustainable in the long-term.
More amazing is that the Nintendo Switch is benefiting from this; after all, the Wii U was summarily slammed and ridiculed for not having big “Triple-A” games on its platform for so long, so much so that people are convinced EA were the ones who ultimately killed the Wii U sales figures dead. The opposite seems to be the case for the Nintendo Switch; not having these big, current “Triple-A” titles with all their additional monetary demands actually is starting to be seen as a positive thing, a turn of events that only further convinces me that Nintendo must have a guardian angel watching over them because otherwise they must have some dark ritual happening that grants them obscene amounts of good fortune.
And as regulatory bodies and political figures move to calm the waters and investigate the proposition of regulatory oversight and stringent rules and guidelines, investors are also starting to slowly and by degrees realise that this was a monetary scheme that was destined to fail at some point. With only a finite volume of money in the world, eventually the demands on gamers would grow too great and too exploitative to be tolerated. And this suddenly means “Triple-A” games are no longer safe bets. They can be affected by poor quality, bad PR and preposterous and overly ambitious budgets and sales goals. Games can disappoint – and gamers, in a resurgence for the industry (particularly on the lower to mid-tiers) are spoiled for choice when it comes to games. Brand power alone is not enough anymore; games have to stand or fall on their own merits as video games.
And as regulators, analysts and political figures bandy around the term “Triple-A”, the negative connotation is being reinforced. That this is what “Triple-A” has become; a self-perpetuating cycle of abusing and milking one audience to effectively pay off others. That “Triple-A” games have become glorified gambling exercises targeting children who spend their parents money without thinking of the consequences, much like the Apple “in-app purchases” scandal of a few years ago.
To maintain some allusions to and illusion of stability and fiscal propriety, they created for themselves a situation which was only ever going to blow up in their faces, and with a bunch of games this year being widely panned for this very thing – FIFA 18, NBA 2K18, Shadow of War: Middle Earth, Call of Duty: World War II (which has an achievement for you to watch others open boxes, further applying social peer pressure to help others get the same achievement) and of course Star Wars: Battlefront II where it all came to a head – that situation has arrived sooner than the industry was perhaps prepared for.
For me, the industry simply didn’t understand or perhaps didn’t care enough about long-term viability or sustainability of the industry. It was about having “all of the money”; to look good at the end of a fiscal year, to throw out huge figures and make a bunch of people with their 401K’s feel better about their investments. It was, by all accounts, superficial window-dressing. A scheme that got out of hand really fast when the industry had to face an uncertain and difficult period in the history of video games. No moral panic had been quite as explosive as GamerGate, after all. Not even Jack Thompson could have fashioned a more divisive and messy situation.
But now, gamers have clearly had enough – Battlefront II not only got a massive punch in the nads on physical sales (down 60% on the first game, I have read) but even prompted Disney to demand EA take action or face losing the lucrative Star Wars license… which EA may well still lose at the end of this. And regulators are now primed and ready to deploy the tactical nukes on a corner of the industry that for so long went unchecked, given a free pass because they were just careful enough to hide out of the line of sight of the law.
The future for “Triple-A” is the bleakest it has ever been, despite the huge demand for video games lately (particularly on the Switch). But I do not feel bad for the industry – they have had years to adapt, to change and knew full well that these mechanisms and systems were unpopular. They had every opportunity to find different ways of making money – from better quality games which could be sold as quality products to revisiting the mid-tier to see if a well budgeted, experimental game could in fact grow into a bigger thing rather than pushing it out on stage hoping the baby-faced new IP they had borne could tapdance its way out of trouble (mostly, these games haven’t).
I don’t particularly relish the idea of regulatory oversight as some – I do believe that in some cases, politics should maintain a safe distance from business (Marvel has been learning this in recent years). I don’t think politics should be entirely absent – but the problem is, like “Triple-A”, you can have too much of a good thing and give them an inch and they will take the proverbial mile. There do need to be very well defined boundaries, but that’s all I would like to see.
But I also concede that there is a particular necessity now for oversight. And if the ESA and ESRB cannot perform this duty… well, the inevitable situation is always going to be well-defined regulatory oversight.
The games industry just found that maintenance of “The Triple-A Illusion” had become impossible. And now we can see all the dirty machinations for what they are – worse, EA even readily admits that Battlefront II will probably make money regardless, and the removal of “Star Crates” will have no impact on its end-of-year fiscal report. Only highlighting and spotlighting the issue for the grubby cash-grab that it was intended to be.
Perhaps that’s the problem; the video game industry never really adapted to Gen-8. They just assumed that they could get the same volume of money from a smaller userbase, not realising even a cow will kick you if you linger too long around her milk-laden udders. They had gotten so attached to this idea of “Triple-A” that they were either blinded by it, or convinced themselves that it was a noble goal to pursue.
And here we are. The term is tainted, poisoned and for most now utterly unusable.
… but I couldn’t be happier. It was always a stupid term anyway. As a gamer – I firmly believe games should be judged on their merits, not on their “tier” status. Throw away this idea of “tier” status and hopefully – just possibly – games can go back to being judged strictly on their merits as a fun, engaging and entertaining video game and not because of huge marketing and advertising fees making reviewers err on the side of positivity.
I’m a simple man and that’s a simple dream… but hey, if there’s one thing to be said right now – all bets are off the table.