Strategy for Information Markets/Video Game Development

Strategy in the PC vs. Console Market

For PC games: because with the technology going so fast. More and more new PC games are coming out which makes PC’s hardware need to update more frequently. The PC users need to spend more and more money to make their PC’s quality better to play the newest game. However, video game console doesn’t have that kind of problem. Usually a video game console like XBOX has at least more than two years service life. The user never needs to worry about change the hardware to a better one. All they need to do is just buy the game. It makes for both game console producer and game developer cost a lot less money for changing new equipments. And which makes the game console cheaper more competitive.

The market for the development of online PC Games differs from that of the console game market in several ways:

• Developers can avoid manufacturers' licensing fees. PC Games can generally be run on any PC related hardware, whereas console games are limited strictly to the technology associated with the platform for which the game is released.

• Low overall development costs, including the avoidance of expensive development packages, allow the break-even quantity for high-quality a computer game produced in 2002 to be around 90,000 units, compared to the 500,000 break-even quantity required for license-laden Nintendo games

• PC games can be developed by small groups of individuals, whereas console games are generally developed by large corporations who are able to cover the costs of development packages. This allows for a much broader array of games, across many genres, to be produced. One of the most popular online first-person shooter games of all time, Counter-Strike, was originally created by Minh "Gooseman" Le and Jess "Cliffe" Cliffe, two individuals who developed the game by modifying code from the game Half-Life. Although their creation was eventually published and distributed through Valve, Gooseman and Cliffe were responsible for its initial creation.

Success in video game production

Activision owns the rights to many of the most popular games available. They are responsible for bestselling games on various different consoles. Activision has recently acquired 7 more game development studios and has assigned to each of those studios the task of creating a single game. Assuming the games are a success, the studio will continue to make the sequels to each game. Activision’s motto is “one game per studio.” This allows for the creation of a single game to be the sole focus of the studio, contributing to better continuity, communication, consistency, and attention to detail, as well as response to consumer demand. Activision has repeatedly released top selling games and sequels. This is due in part to the focused allocation of time and money that goes into producing a single game title and subsequent iterations. Activison’s Executive Vice President David Stohl said, "I think we have done a really good job, in fact, we have done probably the best in the industry ... But you've gotta anticipate things -- things like new hardware, hardware transitions, the cycles of it all, that kind of stuff -- and then anticipate, and try to be smart about it." Their “one game strategy” is promising for the short run, but Stohl knows that it is vital to be aware of technological advancements that will continue to improve and transform gaming and game developing. Activision’s strategy will likely continue to change.

Electronic Arts, also known as EA games, were once only marketed to computer and software companies for stock computers when the company was founded in 1982. Today, they are the world's largest video game production studio and own more game series than any other studio. EA's success is largely due to the mergers and acquisitions the company has acquired over its existence. Many critics feel the company is harsh to its employees due to its drastic measures to cut staff and game productions as well as working their teams long hours to meet sales goals and to keep their profit margins green. EA believes it is beginning to cut old patterns of management but wants to ensure that quality in product development will not be sacrificed.