IndustryGamers - Informing the Games Industry

Lou Castle on InstantAction's Plan to Revolutionize Gaming

Posted August 18, 2010 by James Brightman

IG: So in terms of the future of InstantAction, will you focus on building more of your own games like this, sort of simple downloads that are just 60 megabytes or are you looking to build console type epic experiences? And when you look at the mix of your own internally developed things, and trying to become a publishing platform, how do you see striking that balance? Are you looking to do more of your own games, are you looking to do more publishing of other people’s games?

LC: So the way we see it, is that you have to eat your own dog food, as it were. We need to know what it’s like to use our platform for our products so we can build a good platform for our partners. The cost of building and delivering a truly robust electronic delivery system, especially the scope of what we’ve done with InstantAction, is truly a massive undertaking. And if all we were doing is one or two products at a time, which is all I’d like to do because I’d like the studio to stay focused, we’d still be spending an awful lot of money building this very massive robust proprietary platform. Plus, we have no issue with other people using it. So I guess the answer is, I would hope with the first title like this, we can build a lot of metrics and prove out to people that this is certainly a method by which distribution can be done very effectively throughout the world; and then that also gives us the momentum to start closing the deals with good publishers we’ve been talking to because we can demonstrate not just in theory that we can do the job with a demo, but we can show millions and millions of people playing, which is of course important.

So I would say that my expectation is, we will continue to build one or two products; we will always build console quality games. That’s what we do, that’s what Instant Jam is, it’s not a flash game, it’s a full 3D shot at the genre in way that's novel and different, but it’s a multi-million dollar effort. And that’s what I’d like to keep doing too. You’ll see us do a couple of games, maybe release one a year, maybe a couple here on the outside. We'll see some external development when we have people that are excited about the platform and have a novel use for it. We’re certainly doing that right now; we’re finding a lot of external projects. And then of course hopefully we'll be publishing a lot of other people’s stuff. I don’t have any control over that, but I believe if we build a great distribution system and we have the right business terms that people will use it, because it’s extraordinarily expensive and complicated to build. So why would you duplicate it if you don’t have too?

IG: So when you say it's a multi-million dollar effort, as you're looking to recoup those costs, is it primarily going to be a micro-transaction business model, where you can get other items for your virtual on screen rockers?

LC: That’s exactly right. The first avatar in our game, if you will, is the guitar. So we’re focused on the guitar. You can buy different kinds of guitars that actually change the way the game plays. So those are micro-transactions and also unlocked with level of ability in the game as well. So there are earnable and paid ways of getting items just like you’d find with most social network games. The difference here is instead of buying pigs and hay bales, you're buying guitars and fret boards, and there are certain things that are visually appealing like the background videos and stuff, and other things that actually change the gameplay, like the guitars themselves. So for us, that is exactly the model; it’s all essentially micro-transaction based gaming.

IG: We were talking about Gaikai earlier, and it almost strikes me in some ways that you could view Gaikai as a competitor to InstantAction. I know it’s a little different business model, and Gaikai is not building their own games, but you are both very browser based focused kind of platforms for publishers, so I’m kind of curious how you view Gaikai?

LC: Well, David [Perry] and I met at the last Gamescom and we were talking as friends – we’ve known each other for a very, very long time. We were talking about the various things that we are doing in our lives, and I was undertaking the building of a very similar service to Gaikai that would have been a direct competitor as part of the InstantAction platform. They were looking at trying to build a front end for their service that would help them compete more head to head with OnLive, and we came to the conclusion that this feels kind of silly. Each of us has a very specific part of the business that we’re passionate about that we’re doing, and we’re kind of reluctantly building something that isn’t really part of our passion or what we want to build; it was something we needed to have as a tool. That was what spurned the first agreement we wrote with them, and I’m very happy with it. I’m delighted that their service is going live. I think the fact that they are available to lots of people is great for us, because it ends up creating better service that we can then tap into. So it’s all good. I hope he makes a pile of money and I hope they do a great job with it. Our integration of Gaikai is I think novel and different than most people’s thoughts. We’re not looking at it just for advertising; we’re using it as a customer acquisition vehicle... So I don’t view them as a competitor at all. I think they are a wonderful business partner and I am looking forward to having the products that really require that piece of the puzzle to work for us. 

IG: So when you look at the evolution of this industry, the general trend lately has obviously not been positive on the retail side. Looking at the Gaikai model, or your model, the online browser stuff, do you really think that's where all this is going? Do you think consoles will eventually just fade away?

LC: Those are different questions, so I’ll try to address them individually. The first is, do I believe that the retail market is declining rapidly? And I have quite a public record of saying “of course.” It’s being done because the retailers themselves are helping to drive it into the ground. The publishers that are out there that are depending bricks and mortar, can’t say publicly what everybody knows is the problem. When you have your distribution channel competing with you for sales, it's very difficult to survive; that model doesn’t survive very long. It’s a combination of used games, rental games and piracy – those are the three things that are killing the retail market. Each one of them is a pretty bad thing in and of themselves, but they multiply when you put them all together. And so, I know the GameStop guys and Walmart guys are kind of bemoaning the fact that software sales are down, and it’s like “yeah, and whose fault is that?” So, of course that’s one part of the thing. 

I also believe there is a huge audience for the premium content that is available on console machines, and I believe in it so strongly that not only do I want to create it and I want to keep doing it, but I also feel that somebody has to take the plunge and go build a better distribution system. The brick-and-mortar distribution network is fundamentally flawed, especially as we go into the future.

The second thing I think is a different issue, “will consoles go away?” I don’t necessarily agree with that. I think consoles may be around for a very, very long time. We might never see another major console like a 360 or PS3, or we might... it just depends on what Microsoft, Sony and Nintendo do on the platforms. So we may or may not see those things coming, but they may look very different to us. They may be in the form of a mobile device; they may be in the form of television set that has all the guts that you need. So I don’t believe that console, or fixed hardware gaming, is going to go away; I think it will change more. And frankly, they’re not particularly thrilled about the bricks-and-mortar distribution, the way it works for them either. It’s not great for them. They have no choice in selling it through them, but there are other are a lot of other ways of doing it and getting that device into the home. I think that will evolve and change, but I don’t think that they will go away. I don’t believe that PCs are going away any time soon or Macs. They’ll continue to change. You’ll have pad-like devices with apps instead of software. I use an iPad a lot and a PC a lot, a Mac actually. I have both Windows and Snow Leopard. So, being able to look at all of those devices as a consumer and see where they fit, I think that landscape is going to change and shift.

That’s part of the reason I’m in the business right now. I think the time is upon us for reinventing the way consumers get to the content, and using all of this great connectivity to connect the people that consume the content to the people that create the content as closely as possible; I think that’s the disruption that we’re going to see. You mentioned something earlier about Gaikai and its online system. Just because it’s distributable for the browser, doesn’t mean that it’s exactly the same kind of solution. I don’t view our distribution methodology as the end all be all, and of course I want to create intellectual property. I do think it is a great bridge technology that will stir us for some time, some many number of years, and until high speed, low latency connectivity is available everywhere things like OnLive are always going to be challenged.

IG: Looking at the new technologies that are coming out with Kinect and Move and the big 3D gaming push from Sony, what impact do you see these having on the market? It's all obviously a different approach from what you’re doing, the browser based stuff. These other things are very hardware based solutions to boost the market, expecting people to shell out money for new devices or new 3D TVs or whatever, so what kind of impact do you see these things having?

LC: I think that 3D will have an impact, especially the DS; that’s just a remarkable device. I think games that have been written to have 3D in them work so much better on a 3D device; it’s just head and shoulders better. All of these technologies are using 3D glasses, but I’ve seen technology that doesn’t require glasses, which is really exciting too, because you almost feel like you can fall into your HD television – it’s really cool. I think these are all going to have a huge impact, but unfortunately I don’t think that these are ways to shift the industry really quickly as these all require a physical purchase of an expensive hardware item. I expect the prices will go down as more people buy them, and they’ll become more and more ubiquitous and pretty soon you’ll be buying your big flat screen TV, and whether you like it or not it'll have 3D – it will be part of its feature set. So once that happens, and when that TV is connected to the Internet – and by the way, it also has some hardware acceleration in it – suddenly you’ve just sold a browser. Whether you meant for it to be a browser or not, it just happens to be a 3D web browser instead of a 2D web browser, so I think fortunately for us, electronic entertainment has got [plenty of room for growth].

IG: Thanks for your time Lou.

James Brightman has been covering the games industry since 2003 and has been an avid gamer ever since the days of Atari and Intellivision. He was previously the EIC of GameDaily Biz.