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Interview: Insomniac's Price On Resistance, PS3, And More

Analysts Jason Kraft and Chris Kwak have spoken to Ted Price, CEO of Insomniac Games (Ratchet & Clank, Resistance: Fall of Man) on a variety of topics, including the PS3, in-game advertising, video game legislation, and the relationship between pub

Jason Dobson, Blogger

July 25, 2006

32 Min Read

The latest issue of Jason Kraft and Chris Kwak's 'Video Game Journal' for the Susquehanna Financial Group introduces a series of upcoming interviews with industry figures in an effort to better understand the video game industry by looking at it through the eyes of those helping to shape it. As the first in the new feature, titled 'Studio VG: The Foundation Series', the analysts spoke with Ted Price, CEO of Insomniac Games (Ratchet & Clank, Resistance: Fall of Man) regarding a variety of topics, including the PS3, in-game advertising, video game legislation, and the relationship between publishers and developers. The interview starts as follows: “VGJ: Ted, Insomniac Games is most famous for the Ratchet & Clank series. That franchise got bigger and better, domestically, and even in Japan. What was it about Ratchet & Clank that made the series appeal to so many gamers? And how have you been able to take these successful elements and apply them to new projects? TP: I think that it was the right game at the right time. We were trying to do something very different with the platform genre in a market that had turned away from it. We hoped to provide an opportunity for players who liked that type of game to get back into the genre. VGJ: What kind of platform games do you recall in that period, and what was missing in that era? TP: We were still in transition from PlayStation One to PlayStation 2 and platformers at that point were “collect-a-thons.” It was all about gathering things like dragon eggs and gems – the challenges were wash, rinse, and repeat and as a result there wasn’t a whole lot of innovation. We tried to interject aspects of other genres, such as RPGs (Role-Playing Games) and shooters to create twists on the genre. I think it fi lled a void and created an alternative to what had become a fairly tired genre. And in saying that I include our own, Spyro: The Dragon games, all of which followed the traditional well-worn platforming formula. VGJ: It seems like you’ve taken some of those elements like melding different genres (with platform, RPG, fi rst-person shooter) even for Resistance, which we’ll talk about in a moment. TP: That’s always been our goal – to take genres, push them in new directions by introducing new aspects. I don’t think that’s particularly different from what other developers who have created original franchises have tried to do. Our interest is creating well crafted and varied game experiences, while trying to give the consumer more bang for their buck and hopefully showing them something new. First-Person Shooters and Resistance: Fall of Man VGJ: At E3, around every corner we saw first-person shooter titles. You have a highly anticipated first-person shooter – Resistance: Fall of Man – launching with the PS3. In our “Genre” issue [I Dream of Genre: Shooter, Racing, and Action, February 21, 2006], we noted first-person shooters seemed to be gaining share over other genres. But it seems crowded with Halo, Doom, Half-Life, Call of Duty, and Medal of Honor, among others. And there are some big titles launching this holiday, such as Gears of War and Call of Duty 3. How do you make first-person shooters interesting in the next-gen for consumers? TP: You focus on a strong story; you focus on variety; you focus on innovations within the genre; and I think most importantly, the game has to feel coherent so it’s not a blast-fest with no purpose. A lot of recent first-person shooters have done these things very well. We certainly plan to introduce compelling, new elements with Resistance: Fall of Man. Especially when it comes to the weapons, which is generally what the first-person shooter genre is all about. VGJ: Let’s start with the story line. It’s one of the games that stuck out for us immediately at E3. Of the games we saw, Resistance was one we enjoyed playing and looking at. The story line is interesting, and I think there are a lot of people who think it’s a World War II shooter. But it really isn’t. TP: True. In this game, World War II never occurs. We purposely tried to create an alternate history setting where events on earth have not happened the way we remember them from our history lessons. And because of this, we’ve been able to distance ourselves from the glut of World War II shooters that exist and which are continuing to come out each year. We’re introducing a more twisted history – one with more of a science fiction bent. We hope this appeals to folks who want more than just a retelling of known events. VGJ: It seems this alternate history idea allows you to mingle classic human weapons and new weapons of the enemy. Some of them like the Bullseye seem interesting. Can you talk about the weapons, what you can do with the type of weapons, and not just the shooting weapons, but others, such as the grenades? TP: The Bullseye, the Auger, and the Hedgehog – those are just three we showed at E3. It’s a small sample of weapons in the game, but they’re indicative of what we did with all the weapons – create primary and alternate fire modes that do interesting and unique things. What’s great about being in this alternate history world is that we don’t have to constrain ourselves to real world physics or adhere to known weapon designs. We can do things like having Auger projectiles that tunnel through objects. We can have Bullseye bullets that not only bend around corners to track enemies but can be collected in “traps” that can be detonated when enemies approach. We have a rocket launcher where you can stop the rocket in mid-air and have it hover above cover positions – essentially converting the projectile into an artillery shell. And of course there are many more weapons with even cooler functions. The reason we’re doing these things is to give players lots of options in terms of weapons strategy. There are many layers to these weapons and when you use them together in combat scenarios, we gain the kind of gameplay variety we had in Ratchet & Clank. Of course the gameplay here is much darker and more visceral than that of Ratchet. But providing weapons with depth has always been a goal of ours and we’re simply continuing our fondness for layered combat with Resistance: Fall of Man. VGJ: For the consumer looking at first-person shooters this fall, another element that stands out with Resistance: Fall of Man is the AI (artificial intelligence) element called “hero moments.” Can you talk about that? TP: We’ve given most enemies special attacks against humans. When an enemy gets close to a human, they’ll do all sorts of interesting things to their victims and in many cases it’s an execution of some sort. As a player, you have a couple of moments to shoot the enemy off the human and save your ally. This has a gameplay benefit because if you save more soldiers during large battle sequences, it helps you survive the battle. You have to be aware of your surroundings, you have to know where your soldiers are and you have to pay attention to what the enemy is doing. The technical challenge for us is making enemies interact believably with the soldiers. We’re talking about a lot of complexity in terms of joint alignment and collision. A ton of calculations have to go on behind the scenes to make everybody line up correctly and look good. On the PS3 we have the processing power to be able to do such things whereas we couldn’t have come close on the PS2. VGJ: Speaking of the PS3, Resistance: Fall of Man is going to be a launch title, correct? TP: That is correct. VGJ: Insomniac Games sided with PlayStation and PS2 over the past ten years, and that was the right move in retrospect because they [Sony] garnered most of the market share. But now, Xbox 360 appears to be in a fairly good position. Resistance: Fall of Man is exclusive to PS3. As CEO of a studio developing a game exclusive to the PS3, what are your thoughts about that? TP: Actually, I think we’re in a really good position because having a launch title for PS3 means the game gets a lot of exposure. And you mentioned before that the first-person shooter genre is extremely crowded – that’s true. But one of the best times to introduce a new franchise is at a platform launch because there are fewer games around in general. Notwithstanding the timing, the game should stand on its own, but the additional exposure at launch should help us further establish Resistance as a long-term franchise. So, for us we’re definitely looking forward to the launch of the PS3, and we’re certainly keeping our fingers crossed that people enjoy what PS3 has to offer. VGJ: Another thing about Fall of Man that struck us is the 32-way multiplayer capabilities at 60 frames per second. In the multiplayer world, Xbox Live is a big deal. Microsoft has the lead here. We believe online/multi-player is going to be critical for this cycle [Franchises on the Endangered List: Natural Selection Takes Its Toll, April 4, 2006]. Since you are exclusive to the Sony platform, and there is still little that we know about the Sony Network Platform (NP), what are your thoughts about the NP and what you can do to take advantage of online play? TP: I can’t really talk about NP’s features, because Sony has not announced those yet. But because Fall of Man has a robust online multiplayer experience, people are going to be able to experience PS3 online on day one. I know that’s kind of a vague answer, but it’s easier for me to talk about the features we’ve announced for Resistance. By the way, we’re now supporting 40 players online – we’ve added 8 more since E3. VGJ: So you don’t think the game or the multiplayer elements of Fall of Man will be constrained by Sony’s new initiative, which we still don’t know a whole lot about? TP: Exactly. I think we’re not constrained at all in terms of gameplay that we’re presenting. We’re doing more online on PS3 than we’ve done online on PS2. If you remember, we had eight-player online in Ratchet & Clank: Up Your Arsenal and ten-player online in Ratchet: Deadlocked. We now have much more complex characters and environments on PS3 and a lot more of them. VGJ: We play Call of Duty 2 on Xbox Live, and it’s a nice experience. It’s not 32 players but enjoyable nonetheless. If we were to play Fall of Man online on the PS3, we would hope to have a similar type of experience. TP: I think your experience will be divided into two parts: your experience in the game itself, and then your experience in NP and all the extras that come with it. We’re focusing on the in-game experience and ensuring that it’s truly varied and fun. And of course we’ll be offering several modes other than deathmatch. VGJ: Turning to another subject, Resistance: Fall of Man is not ideal for in-game ads, but in-game advertising is a big subject and we’ve written about it recently in our issue [In-Game Advertising: Just How Small Is the Opportunity?, July 11, 2006]. TP: I thought that was a great issue. VGJ: Thanks. What is your take on this market? TP: I think you guys nailed it. There’s a lot of hype about possibilities, but the reality is that not every game is well-suited for in-game ads. A game like Resistance: Fall of Man, which doesn’t take place in the world that we know makes it hard to strike deals with advertisers since we’d most likely blow their stuff up in-game. Plus real brands don’t necessarily fit in our universe. On the other hand, it makes a lot more sense for sports or racing games – games that use real-world settings. We’re seeing more of that and that’s a good thing. VGJ: The casual/online short session game market has been ahead of console games in dynamic, in- game ads. TP: I also think it makes people in other industries take video games more seriously. VGJ: Is Insomniac considering developing downloadable or episodic content? What are your general thoughts on the concept? What do you think is interesting about it and what are the pitfalls? [Episodic Gaming in the Age of Digital Distribution: The Following Takes Place from Page 1 to Page 5, April 18, 2006] TP: I think downloadable content – which includes micro-transactions, episodic content, and full online delivery – is the aspect of next-generation consoles that will save developers. I believe this because it opens up revenue opportunities that developers and publishers have not been able to tap into. It’s also what the consumers want. We have a society being trained to engage in micro-transactions on a daily basis - we buy music on iTunes, we download ringtones, we order pay-per-view movies. It’s being done successfully in other industries. Plus we certainly can make content delivery much more convenient for consumers and at the same time get more content to market faster. VGJ: It seems part of the bottleneck is the console manufacturers (i.e., Sony and Microsoft), in the way they open and close the gate based on how they feel in a given year. Do you see that being the biggest hurdle? Is someone like Sony or Microsoft saying, “All right now. We can download games.” Do you think that’s what the industry is waiting for? TP: I think that’s what’s going to happen. VGJ: It’s a matter of when, not if? TP: Yes. VGJ: One thing we’ve observed is that Microsoft has to push for this, because the retail relationships they have are tricky. TP: Well, I agree. It’s a very delicate balance that the console manufacturers have to strike. The publishers have their relationships with the retailers as well. I’m no expert in this area, but we’re certainly seeing it happen on the PC side, and it appears to be successful for many companies. It makes sense. Consumers will demand it and someone will offer it, so I think the gates are going to open. More importantly, it gives developers the opportunity to distribute more content with lower overhead and that’s really crucial as we move into games with absolutely monstrous budgets. Playstation VGJ: There’s no doubt that next-gen development costs are top of mind for the big publishers and independent studios, such as Insomniac. Team sizes are growing, and we note that when Insomniac first launched Ratchet, you had roughly 50 people, and now you have 155. How have you dealt with next-gen development costs given your exclusivity on the PS3 and all of the talk that PS3 is harder to develop on and costs more versus developing on the 360? TP: We’re definitely taking a long-term approach in terms of tools and technology. On the earlier platforms, we could spend a good part of each game redoing a lot of technology. This time, we’ve been more intelligent with the systems we’ve created – for example, creating our own rendering engine and underlying systems with more forethought to ensure we can build on that platform for a long, long time. That does require more people up front, but we hope that as we move further into the next generation, we can – instead of recreating technology – reutilize technology and continue to turn the dials as we become more familiar with the PS3. VGJ: With the proprietary engine for Fall of Man, how do you take advantage of the PS3 hardware? TP: Because we don’t have to worry about making the game for other platforms, we can code specifically for PS3 and utilize the SPUs (Synergistic Processor Unit) as efficiently as possible. What the Cell offers is a number of SPUs onto which you can offload a number of mathematically intensive processes. This way you can free up the central processor for other tasks. The challenge is in balancing the load between the SPUs and the PPU (Power Processor Unit). If you do it well, you can do a lot more per frame – you can support more complex AI routines, you can support more believable physics, and more dynamic lighting for example. For better or for worse, when you work with PS3, if you want to get the most out of it, you have to code for PS3 and not create a more generic engine designed to work on multiple platforms. VGJ: When you mention developing a game for PS3 hardware and the advantages that accrue versus developing a game that tries to be all things to all platforms, do you think that going forward, if a game tries to be all things to all platforms, the games will be more watered down than a game like Fall of Man that takes advantage of the unique attributes of the PS3? TP: That’s a good question, but it’s hard to answer. As I said before, I think the strongest engines are developed with a specific platform in mind. But until we see an engine that is used on both 360 and PS3, no one will really know the answer. VGJ: With all the talk of outsourcing, have you been making use of outsourcing, or have you done everything in-house? TP: We have done just about everything in house. We do have a tradition of outsourcing music and voice acting, which we’ve done again on this title. But doing most things ourselves is how we worked for the last 12 years. VGJ: Given the lackluster response Sony got at E3 from many critics, how does Sony in your view beat Nintendo and Microsoft this cycle, when the Bluray vs. HD-DVD battle seems just as important to Sony as next-gen gaming? [DVD Format Matters: 360 vs. PS3, October 25, 2005] TP: You must remember at E3 two years ago, people were saying the same thing about Microsoft. The Xbox 360 games didn’t get a huge response because the spotlight was on other platforms. This year at E3 we were looking at PS3 games that were at least six months out and some even further than six months out. It’s hard for people to keep things in perspective in terms of where the platform was in development at that point. Yet as in every cycle, I think it’s the software that drives it. Great games drive consumers to the platform. Great exclusive games will be a big help. VGJ: Like GTA (Grand Theft Auto; Take-Two) on the PS2 in the last cycle. TP: Yes. You’re already seeing original games on PS3 in the very first wave. Typically, what you see at launch for most platforms are sequels or ports, and you don’t see many original franchises. PS3 announced a bunch of original franchises, any one of which could be a killer application that could drive consumers to the platform. VGJ: With Microsoft you had two first-party franchises with Kameo and Perfect Dark Zero and you had GUN from Activision. TP: True. And with Perfect Dark Zero, you had an established franchise. But GUN and Kameo were new. It comes down to execution. If all of us making PS3 titles can do a good job, then certainly it will help drive the PS3’s success. There has not been a lot of publicity about all these titles to date, so I think everyone is waiting and holding their breath to see what will happen. Industry VGJ: At a 10,000 foot level, what are the key differences between this cycle versus the last cycle. What feels the same? What feels different? [RETHINKING NEXT-GEN ASSUMPTIONS: Myth #3: Attach Rate Will Rise, June 6, 2006] TP: I think that online is going to be much more important, because we’re going to see a change in the way content is delivered during this console cycle. I also think the maturation of middleware will have a huge effect on development in terms on efficiencies – in terms where we can save money. I think for the next few years, publishers and developers will be grappling with dealing with larger budgets and the demand for more complex content within the games. How can we be efficient and keep raising the quality of games, especially in the face of insatiable consumer demand for more content and more detail in the games? VGJ: So with that insatiable demand, what is the threshold for what consumers would be willing to pay? Are $60 prices going to be sustainable? TP: When I was buying Atari 2600 games, I paid $70 for cartridges back then, and I had no problem with it. The question is going to be: “Do the games warrant the money?” Will people look at these games and say, “I must have them, and I’m willing to pay $60 or $70?” We’ve paid before, and I don’t see why it can’t happen again. But I’m not making any predictions. VGJ: So AAA or rock-solid titles at $60, but as we’ve seen, some of these titles have come out at $40 with limited gameplay, and it’s certainly warranted. But there seems to be two tiers. TP: I really can’t comment on pricing, since I’m not a publisher. There does seem to be a lot of opportunity for many pricing levels in terms of the amount of game being delivered. For example, you can get episodic content on PC for low prices. That’s pretty cool. We’re going to see micro -transactions or relatively small pieces of games for lower prices. In fact, we’re already seeing this. This may create more financial opportunities for publishers and developers. I think we’re all singularly focused on the retail price of big games and that is not the only area we should be focused on. VGJ: Sort of a broad question, but what keeps you up at night as a developer? What do you think keeps the publishers up at night? How about the console manufacturers? TP: As a developer, that’s an easy answer: hitting deadlines and getting the game done. That’s always a huge stress. Plus making sure the content we planned is what is delivered in the game adds to the anxiety. That hasn’t changed. We’ll have the same stresses regardless of the platform. We want to create something great and memorable. And of course, we’re always apprehensive about whether or not consumers will like what we’ve made. We work in a vacuum, so it’s hard to judge how players will react until the game is released. Yes, we have focus groups, but it’s not the same as delivering the game to millions of people. For publishers, perhaps it’s, “How is PS3 going to do when it comes out? What’s the public’s reaction going to be?” Plus there’s “Where will the next great game come from? Will there be another set of killer applications for this generation like the last generation?” During the last generation, there were really two that drove console sales and which got the most attention: Halo and GTA. Will we have that this time? Perhaps not. Maybe we’ll have a slew of great games, none of which outshines each other in such an incredible way. VGJ: I hear Fall of Man is in the early lead there. TP: (Laughter). I certainly hope so. VGJ: When you talk about deadlines and getting great content, the thing that could limit great content creation is game legislation, or anti-game legislation. You have been proactive in sharing your opinion here. You recently wrote a 21-page amicus brief on the topic. Does all of this noise around game legislation pass with time, as it did with movies, music, and books, or is this an issue that gets worse? Since Fall of Man will likely be Mature rated, this is very topical for you. TP: This legislation directly affects us and every developer in the industry. Most legislation proposed has ambiguous definitions for what is “violence” in games. The legislation that most of the states have proposed or have passed ignores the video game industry rating system, which has been well thought out and consistently applied across games for over ten years. As a content creator, it’s very difficult to imagine what would happen if those laws stood, because we’re dealing with ambiguous and arbitrary definitions of violence in games, and we have to figure out how to make content that doesn’t trigger those laws. This can be impossible to do when the vague definitions for restricted content can be interpreted in multiple ways, and when each state takes a different approach. Furthermore, as a consumer and a parent, I worry this is the government attempting to tell us what our kids can and can’t do. I prefer to take responsibility as a parent for what movies my kids watch, what TV programs my kids watch, and what games my kids play. I don’t want the government telling me I’m prohibited from doing something, especially when it comes to the artistic content my family and I enjoy. Finally, as everyone understands within our industry, these laws tend to create a double standard for games. Despite the fact that the content we create is as artistically relevant and varied as fi lm and television we’re not being afforded the same constitutional protection. Under much of the legislation that has passed or is being considered, games are treated similarly to controlled substances like alcohol, drugs, and tobacco. As a content creator I believe that’s inappropriate. VGJ: Do these state laws get systematically overturned one by one or does something have to bend here? TP: I think the industry has had an extremely good record in combating these laws. So what happens next? I hope eventually everyone comes to their senses and realizes that games are an artistic medium and should be afforded the same protection under the U.S. constitution as other artistic works. VGJ: Turning to something you mentioned earlier, how much longer or how much time does it take to make this next-generation game, Fall of Man, versus, let’s say a game that you made for the PS2 or PlayStation? TP: I’d say that’s hard to quantify because whenever we embark on an original title, the first game in a franchise generally takes longer than the sequels. The first Ratchet, we were in development for at least two years. We’ve been in development for many months on Resistance: Fall of Man. So, despite it being a larger piece of content with a lot more going on graphically, there are elements of middleware and tools that enable you to keep the development time reasonable. TP: Well, we create a lot of proprietary tools at Insomniac. And when I say tools, I mean the tools our artists use to put together the worlds and to create the behaviors of the enemies. But we also use commercial tools like Maya, Zbrush, and Photoshop. We also use plug-ins like SpeedTree and we use Anark for our HUD (Head-Up Display). Those are the kind of things we have been using for a while now, and that really hasn’t changed too much. That said, there are plenty of opportunities to be more efficient by using middleware and we’re keeping our eyes open. Miscellaneous VGJ: One of the things you point to is development budgets are larger, and publishers and developers have a certain relationship. Insomniac has sold almost 20 million units of seven games, so you guys have been very successful. Not every developer will be nearly as successful. What’s the dynamic that you guys see between developers and publishers, and from your experience, has that changed much given the rising cost of game development? TP: It seems like everybody, developers and publishers, are aware of the increased risks associated with larger budgets. So, not having negotiated a new contract with another publisher for a while, I’m not sure how other publishers actually approach new concepts these days. I will say that Sony has always been extremely positive about taking risks with new content, and that’s one of the reasons we work with them. Sony has been adamant about supporting original franchises, and that dovetails perfectly with our philosophy of creating all of our content in-house. That’s one of the reasons our relationship with Sony has been so strong for ten years. Our interests have been perfectly aligned. That may not be the case for all publishers and developers who work together. I think we’re very fortunate to be in that position. VGJ: Given the ballooning budgets for at least the next couple of years, do you think first-party guys like Sony will have to be more selective in the developers they’re committing capital to? TP: Sure. VGJ: You guys are in an enviable position there. We’ve also seen a lot of private equity and venture capital coming into the marketplace with Bioware-Pandemic and others recently. What’s your sense for what’s going on in the way developers have attracted capital? Is that something we’re going to see more of, as a trend in the industry? TP: I think it’s actually a good way for the industry to continue to branch out and provide more opportunities for the content producers whether it involves venture capital, a structure like the Bioware-Pandemic deal or whether it’s more non-traditional developer-publisher arrangements. I think our industry is still in its infancy – in some ways we’re still the Wild West. We’re all still experimenting with different types of relationships, and that’s fueled by the platform changes. Every time we have a rollover to a different platform, the rules change again. And so everybody scrambles and tries to come up with a new way of making things work for both sides and that’s what, in my opinion, keeps the industry interesting and constantly evolving. VGJ: A lot people look at the next-gen cycle and say it costs so much that the publishers, given their financial position, have all the power. And then you see venture capitalists and private equity money coming in and saying you can be free of the publishers’ chains. Do you think in the next fi ve years the publishers have much more power, or do you see things like with Bioware and also your independent relationships actually having an opposite, balancing effect on publishers? TP: I think what’s going to have the most effect is the shrinking pool of independent developers. There really aren’t that many left – at least that’s the way it seems. Many of the seasoned development teams have been bought by publishers and no longer have the choices to experiment with other types of deals. So, maybe in some respects, this is a good thing for the remaining independent developers because they become more hotly pursued and have more options. VGJ: Ted, this is one of those opinion questions, clearly, but of the Big Four publishers – Electronic Arts, Activision, THQ, and Take-Two – what franchises do you respect most? And which franchises of the Big Four are most overrated? Group: (Laughter). TP: I can’t answer that one, I’ll get hate mail. But let’s see, let me think about the first question. I’ve always respected the Nintendo franchises. It’s what I grew up on. Metroid, Zelda – those are the kind of games that I think got our generation playing and taught most of us here at Insomniac about great game design. VGJ: Did we see you crying at Nintendo . . . when they announced the new Zelda game? [The Smart Guide to E3: Focusing on the Right Issues and Questions, May 2, 2006] TP: (Laughter). No. Group: (Laughter) TP: No, but I’m looking forward to seeing more of it. The Zelda franchise is one I think has always been truly innovative. What’s cool is that each Zelda plays on our sense of nostalgia – since it’s been around forever – but still introduces new content that pushes the industry forward. VGJ: Turning to movies and games, you may have read two of our issues where we looked at “Movies and Games” [Movies and Games: Joined at the Hip, November 8, 2005; Straight to Video: Games and Movies, May 23, 2006]. You see a lot of big publishers licensing movies and launching video games in concert with the theatrical release. If you had to pick one movie you could adapt into a game, which one would it be? It could have already been done or it could be coming out. What would you pick if someone came to you and said, “Ok, you get your shot at doing a movie-based video game.” TP: None. (Emphatically) VGJ: (Laughter) VGJ: (more laughter) TP: No, I’m serious about that. I think this is the wrong approach for the video game industry and I think that we should be making sure that our content goes the other way. There’s so much great content in video games today that it’s a crying shame that movie makers and writers and directors aren’t making more good movies from our content. VGJ: So, the other way around. Excluding (pause) yes, interesting. Excluding BloodRayne and Doom, right, the movies? We would say Uwe Boll, but we’re going to have to strike that out too. Group: (Laughter) VGJ: Game ratings and the critics who formulate those game ratings – how much do you focus on or worry about game ratings and critics during game development? [Debunking the Game Rating Myth: Do Game Ratings Matter?, December 6, 2005] TP: We spend a lot of time reading what people on the Web have to say, critics and players alike. It’s hard to use Resistance because it’s such a small group of people who have played the game. A better example would be our Ratchet games – for example, when Up Your Arsenal and Deadlocked had their public betas. We spent a lot of time evaluating feedback from hardcore gamers that were playing and their comments allowed us to make the games better. Of course after the games come out, we certainly read the reviews and the forums very closely to see where we were right and where we were wrong. And then we try to correct any mistakes we made as we begin on the next game. Hypothetically Speaking VGJ: We’re going to do a little “hypothetically speaking.” So, hypothetically speaking, Ted, if you were the CEO of a large publisher (e.g., Electronic Arts) and you could see their state of affairs, what would you do differently? You obviously already said licensing content is something you would not focus on. TP: Well, I didn’t say that I was speaking from a publisher’s perspective. VGJ: From a developer’s perspective? TP: That was from my perspective. Because as a content creator, the last thing we want to do is work on somebody else’s content. From a publisher’s perspective, it seems to be a good idea. VGJ: Are the movie-based games normally so bad because the publishers spend so much on licenses, then they go out and fi nd at the lowest cost studio that will do the game? TP: That could be. It’s hard to say because we’ve never looked at doing one. VGJ: (Laughter). But, hypothetically, if you were the CEO of a large publisher, which you’re not, you’re obviously the CEO of a development studio, but if you were the CEO of a large publisher, any thoughts about what you would do differently? TP: That’s a tough one because I don’t know what the day-to-day stress is and what the demands could be – I could only guess. My answer will be influenced by my experience as a developer. Anyway, my answer is: “Find more original content.” Look for developers that break the rules and try to do something innovative, because that’s what really expands the industry and continues to keep our industry evolving. Then again, as a publisher, it’s a huge risk. VGJ: Hypothetically speaking, if you were an industry analyst, what would you say is the best thing about the Xbox 360 (and you can’t say Xbox Live, because that’s easy), the PS3 (and you can’t say the hardware engine), and the Wii (and you can’t say the controller)? Group: (Laughter) VGJ: The obvious things were thrown out the window. TP: Oh, great. Is that actually going to be qualified somehow? VGJ: Yes, yes we will. It will say in parentheses, it will have that. TP: (Laughter). OK, I’m not sure if I can come up with a good answer because those really are the ones I would…. VGJ: (Laughter) TP: Xbox 360 – the fact that it got a jump on the other two platforms is a very good thing for Microsoft. For PS3, I’d say… VGJ: Fall of Man launch title? TP: Yeah, I’d say that’s getting pretty specific, but it’s a good answer. I like that. Resistance: Fall of Man. A big line-up of original IP at launch is something we haven’t seen before with previous platforms. The other thing is Blu-ray. The fact that we’ll eventually be able to unlock more layers for up to 100GBs of storage is pretty impressive. The Wii, well, if I can’t talk about the controller, I’d say the presence of franchises that have had such great track records. The traditional Nintendo franchises in a new form should make gamers very happy. VGJ: Well, we saved the toughest one for last, but those are great answers. Ted, this has been great, and we really appreciate your time. TP: Thank you, guys.” [Thanks again to Susquehanna Financial Group analysts Jason Kraft and Chris Kwak for their work reprinted here.]

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