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MULTIFORMATS - July 1997

So, M2 is no more, then. And a bloody good thing too, if you ask me. Not only because it was even more obviously doomed to failure than the last console with a really stupid name (I mean, my granny could have told Trip Hawkins he was never going to sell something called the "3DO"), but because right now, the last thing the videogames industry needs is another format.

I was sitting around the other day, sipping from a bottle of Hooch and deviating from the point for a moment on my sunny balcony, flicking through a few games magazines and wondering half-interestedly why they were all so dismal. Nothing new there, then - I do that most weekends. But I was pondering on why there seems to be no market, no demand for a vaguely intelligent, moderately grown-up publication in what, we're constantly told, is an ever-maturing marketplace. After all, today's gamer is supposedly a wealthy 18-25 year-old male, and normally he buys entertaining, informed, well-written magazines like FHM, Select or Total Football to inform him about his various chosen leisure pursuits. Yet every games mag on the shelf is either puerile illiterate rubbish for sub-normal 12-year-olds, or po-faced, soulless, robotic droning for anal retentives (or, in a couple of faintly impressive cases, a tricky combination of the two). And as the sun beat down, I got to thinking that perhaps the lack of a standard format had a lot more to do with the situation than anyone had previously imagined.

Think about it - how many copies do you think Empire would sell if it covered only films which were shown exclusively at ABC outlets? Who would choose to launch a music magazine devoted solely to records which came out on tape rather than vinyl or CD? And out there in General Public Land, who would buy prerecorded videos that only played on Sony VCRs? Incompatible multiple formats are madness, and are as much a colossal barrier to true mass-market, sky's-the-limit success for videogames as a force in leisure culture as their absurd current pricing is.

Attentive readers might, at this point, be bothered by the lack of blinding revelation in this article. After all, bemoaning the multiplicity of games platforms is hardly a new idea - it's been going on for more or less the entire 20-year history of the interactive entertainment business. But then, if everyone's been going on about it for years, how come nothing's changed? (We ARE in a slightly better position now than in recent years, but I count 4 main platforms - Playstation, PC, N64, Saturn - as opposed to, say, 5 in 1992, in the shape of ST, Amiga, SNES, MD, and the dying gasps of NES. But 4 is still 3 too many.) Surely there must be a reason for things happening the way they do? Surely it can't just be blind cretinous stupidity, not in *this* industry? Surely someone, somewhere must be benefitting from it?

Thing is, I was damned if I could see who it was. After all, how much money can Sega be making on hardware with the Saturn at £99? In what way do Nintendo profit from only having, say, 1 million possible customers to sell their hugely-priced games to instead of 5 million? What's the point in Sony investing so much money and effort building a market around the Playstation if they're just going to throw it all away in 18 months' time when the PS2 comes out?

With low expectations as ever, I decided to look for some answers. But before we start, let's recap just one more time on those basic premises:

  1. No-one actually makes any decent money on hardware, bar a quick fix from the early adopters. The model has long been that of the NES, where Nintendo famously said that they could easily afford to give the console away for nothing and make all their money on big volumes of high-margin software.
  2. Punters are confused by multiple formats. Even now, many ordinary people don't understand why a Saturn CD won't run on a Playstation. And why should they? The rest of the world has fallen into this obvious idiot-trap only twice in 2 decades - VHS vs Betamax, and DCC vs MiniDisc (a novelty double failure, there). We do it every 2 years.
  3. No other consumer item in the world comes with a built-in two-year obsolescence, after which you're expected to throw away your entire system and software and start again from scratch. 15 years after the advent of the CD player, ghettoblasters still always come with tape decks. Is it any wonder mainstream consumers still resist when they're treated so shabbily?
  4. Developers are forced to waste huge amounts of time and resources writing the same game three or four times for different formats, not to mention the massive risks involved in deciding whether to develop for a format at all. Who weeps for all the companies who've just wasted a year or more on developing M2 games?
  5. Multiple formats are bad news for the magazine market, splintering and fragmenting it, enabling publishers to exert undue pressure ("Hey, if you're going to slag our games off, we can take it to 20 other magazines instead") and causing mags to take up half their editorial space with futile and irrelevant attacking of "rival" formats. A single format would cause magazines to succeed or fail purely on the strength of their own content, and would weed out the dross fairly quickly (he said, in a touching display of faith in market economics). And good magazines are good for the business.
  6. There's no inherent corporate or technical reason why Sony, Sega, Nintendo and anyone else couldn't get together, like all other consumer electronics companies do, and make a single universal format. They could still bring out a newer and better one every two years to fleece the trendy, but they could easily make it backwards-compatible, encouraging consumers not to think of games as a cyclical toy-style fad, but as a normal, everyday source of culture and entertainment. The reason MSX (the last attempt at trying the idea) failed wasn't that it was a bad idea, but that it was badly-marketed and ridiculously expensive (in both hardware and software terms) compared with the dominant systems of the time. That's no longer the case.

Most of the sensible ideas in the games industry over the last couple of years have come from Sony, so my first port of call was European President Chris Deering. He didn't much fancy the idea of getting together with his mortal enemies and making just one games machine.

"Having multiple manufacturers of a platform makes it very difficult to establish a workable royalty system - dividing up the system royalties between all the manufacturers of the machine involves a nightmare of claims and figures. What that means is that software has to make all the profit on its own, and that leads to a hardware price that limits market penetration. That's what happened with MSX."

But I'm not suggesting an open architecture available to all, I'm suggesting a single machine that just happens to be made jointly by all of the major hardware companies.

"It would certainly be interesting if there were to be a common standard, though. What we're trying to do with PlayStation is bring it up to a level where its performance penetration can be measured as a percentage of VCR terms. What happens then is that if a single platform gets big enough, it becomes a de facto standard, and that changes things dramatically. Also, we're aware of the history of the industry and we're doing what we can to prolong the life of the current system. There's a lot of life in PlayStation yet - we're not talking about a new machine in 1998 or even 1999."

Okay, so let's all meet up in the year 2000 - when PlayStation 2 finally does arrive, is it going to be backwards compatible? That's the single biggest step that could be taken towards this goal, surely?

"The whole issue of backwards compatibility hasn't been fully explored yet at Sony. My purely personal perspective on the subject, though, are that I was at Atari when they launched the 5200 [the follow-up to the record-breaking VCS] in the early 80s. What we found was that because of the different nature of the CPUs, cost and OS issues meant that to get the 5200 to run VCS games, we would have had to basically bolt a VCS onto the 5200, and that the bolting-on would have actually been more expensive than actually producing a VCS. So if we'd wanted to do backwards compatibility, it would actually have been cheaper just to give away a free VCS with every 5200."

The 5200 was, of course, arguably Atari's biggest flop ever, and the next sequel (the 7800) WAS backwardly compatible with VCS games. By then, though, the company was too far down the slippery slope to recover. Could there be a lesson there, I wonder?

"If you make a new machine backwards comaptible, you also run the risk that the development community will stick with the old system. After all, they've got years of experience with it and the potential market is necessarily much bigger. Why should they take a chance with the new one?"

A fair point, but you only need to look at the PC market to see that the evidence contradicts it - developers are simply itching to play with the fancy new toys, and punters lap up the dramatic new technical possibilities afforded by hardware advances. This is true, in fact, to such a degree that it inhibits the market - new PC games are continually only comfortably runnable on specs that 80% of machine owners don't have access to. (This might be one of the reasons PC game sales have been so consistently disappointing of late - gamers have had to spend so much money on new graphics accelerators and MMX CPUs that they haven't got any left to actually buy the games with.) So you doesn't seem that you can realistically claim that developers refusing to move with the times will be a problem for backwards-comaptible hardware.

"That said, I think we are generally moving in a broadly forward direction - all these factors are well-known at Sony and discussed quite often. The future will not necessarily hem in the industry in the way that the past has. We hope that future developments will enable more people than ever before to get into video games."

And so say all of us, for sure. But that still leaves the core issue untackled - why are we attempting this goal in such a ham-fisted, self-defeating way? Dick Francis of THE, why can't we just all be pals?

"Nintendo have an entirely different view of, and strategy in, the games market to that of Sony or Sega. The difference in approach between games on cartridge and on CD, for example, is so fundamental that it simply couldn't be resolved, which would make it impossible for us to collaborate with them on creating a single format. The games business is still seeing huge leaps forward in technology, unlike film or music - it's all about the next generation, delivering something that your competitors don't. I think the situation's been good for the games business. Competition never did any of us any harm."

I'm not sure if Trip Hawkins would agree with you on that one.

"Well, I suppose it depends if you're a winner or a loser..."

It's difficult to argue with Dick Francis' basic message, which was "Nintendo made $500 million profit last year, and if it ain't broke don't fix it", but that still betrays a certain small-minded narrowness of view. (And with most of the big guns - Mario, Mario Kart, Starfox etc - already fired, it'll be interesting to see if Nintendo can keep up the sucess story next year, when relying more heavily on third party titles than its own famously polished lineage.) The main point of contention here is, essentially, that Nintendo and everyone else could make 5 or 10 times as much money if they could make games a mass market by ending the confusing mess of incompatibility. Francis' argument that the market is all about technological advancement is misleading - the hardware companies are the ones who dictate what it's all about. There have been plenty of advances in televisions, for example, in the last 20 years, but the companies involved have ensured that they've been incorporated into the existing format, with no noticeable complaints from customers or damage to profitability. If you want an FST Hi-Black Trinitron screen, you have to go out and buy the new hardware, but you can still watch the same Eastenders on it. (Imagine - "29-inch screen! Fastext! NICAM Stereo! Dolby surround sound! Only receives ITV programmes!")

So we still haven't found out who benefits from the multiplicity of formats. I decided to shift the search outside the direct perpetrators and asked Greg Ingham, MD at Future Publishing, if he was the man in the money. Greg, would you make more money from a dozen magazines selling 40-50,000 each, or from two or three catering to various niches of an imaginary single format, reaching a mass consumer market and with the potential, therefore, for FHM/Loaded sales levels?

"Well, firstly I'm not convinced that one format would actually be good for the market. It's hugely exciting as it is, with technological advances, competitive marketing, the whole gaiety of nations. I think price of software is the major obstacle to mass market penetration rather than incompatibility. But in any case, I personally find it very appealing trying to keep up with the rollercoaster - if you get your timing right in terms of getting in and getting out of a particular market, you can do very good business."

Looks like we've found our suspect.

"We're in a fundamentally more reactive business, of course - we can't create markets."

Dang.

"But if you're running a portfolio of publications, the whole boom and bust effect is greatly reduced anyway. We can occupy a wide range of areas - in the same way that the music business goes from fanzines all the way up to the likes of Q, we can be simultaneously publishing minority interest mags with small circulations, and stuff like PC Format and Official Playstation Magazine, right up at the top end of the scale. It's still possible that a single format can become the default standard, that's what all the hardware companies really want of course, but the problem is that they all believe they can create that situation by competition, not co-operation."

Well, it looks like I could have saved myself a lot of time by simply phoning Greg first, eh viewers? While the hardware manufacturers stubbornly slug away at each other in a manner strangely reminiscent of Eurasia, Eastasia and Oceania in Orwell's 1984 (battling eternally, yet never achieving anything more than temporary minor shifting), magazine publishers goad them on, chuckling as they rake in the cash. (Compare the profits of any major mag publisher with those of almost any games publisher in the last few years, for example). So if you want a picture of the future, imagine the puffy trainer of mercurial fashion stamping on the uncomprehending face of a member of the general public. Forever.

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