How 5TH Cell Is Changing The Game

Most gamers may not be too familiar with developer 5TH Cell, but it's a name they'll be hearing a lot more about in the future. After releasing such hits as Drawn to Life and Scribblenauts for the Nintendo DS, the Washington-based studio recently put out Scribblenauts Remix for iOS devices and is currently developing Hybrid, a third-person shooter planned for release through Xbox Live Arcade next year.

We recently spoke with 5TH Cell's CEO and creative director Jeremiah Slaczka about what it's like being an independent studio today, if review scores really matter, and if the traditional $60 retail model for games is broken.

-------------------------------------------------------------

Game Informer: So how’s 5TH Cell doing these days? How big is the studio now?

Jeremiah Slaczka: We’re doing really well. Aside from launching Scribblenauts Remix with Warner Brothers last month we’ve been pretty quiet this year; but behind the limelight there’s been a lot going on. We’ve grown to about sixty-five people and recently moved into a much larger space, an entire floor all our own with lots of room to grow. We deliberately grow a bit on the slow side, though. We don’t just hire bodies. Instead we look for talented people who are passionate about what we do.

Project wise we’re still focused on Hybrid for XBLA. We also have some other games in the works we’ll be announcing soon, one of which is a completely new iOS game that is launching in the next month or so.

Can you talk about what it’s like being an independent developer in this current climate? It seems like there’s been a push to be independent recently when only a few years ago it appeared the best way to go was to be bought up.

Well there are different definitions of what an independent developer is. For me “indies” are usually small teams making quirky stuff born out of the love of making games, so getting bought isn’t part of their plan. Other independent developers are looking for the next gold rush like social or mobile gaming through IPO [initial public offering, where a company’s founders sell stock in the firm to make money] or buyout. And then there are more traditional independent dev companies that want to build a business and make games at the same time. There’s nothing wrong with any of those approaches. I just think now all those approaches are possible in this climate, whereas before they just weren’t financially feasible. There wasn’t a space for “indies” to do what they wanted and small startup gold rush companies couldn’t exist in a high budget console era.

For us independence means we get to wake up every morning and do what we love and without anyone else dictating to us how to run our studio or how to make our games their way. The reason we can do this is because we were able to start from nothing and work on smaller projects to build our company and retain control.

If a publisher offered you $500 million to acquire 5TH Cell, would you take it?

If you would have said $50 million I would have easily said no, but wow…$500 million is a lot of money! 5TH Cell isn't currently worth $500 million, so it would be crazy for a publisher or anyone to offer something like that for us. It doesn’t mean we won’t be worth that in the future. One big original IP success and boom, there ya go! We’ve had multiple IP successes. The Scribblenauts franchise alone has generated close to $100,000,000 in gross revenue, so down the line it’s totally possible for a company like us to do really big numbers.

Having run 5TH Cell for over 8 years, I know how hard it is to build a proper team that meshes well; it takes a lot of time and effort and the older you get the less you want to deal with that kind of effort. Startups are such a rollercoaster ride. Anyway, I didn’t get into games for the money; I got into it because I love what I’m doing. 

While 5TH Cell largely has only developed portable games in the past, are you eager to at some point create a big-budget console title? Or is the risk too big these days?

We don't view things as risky or not risky. We just ask ourselves: What do we want to do, and what is the best way to grow to do that? If the answer is a big-budget AAA console game, then let’s do it! If the answer is a giant MMORPG then sure, why not? If it’s a small iPhone game then so be it. For us, there’s no risk because whatever we decide on we’ll be passionate about and pour everything we have into it. It’s exciting to go from quirky original DS game to core shooter to iOS title. You only live here on earth once, right?

At what point do you envision we’ll have all-digital consoles and handhelds? It seems like the popular prediction is that the next console cycle will be the last with physical media.

I share the same view that the next console cycle will be the last to rely heavily on physical media. I’ve been on the digital bandwagon for years. It makes too much sense from a monetary perspective not to do it; especially cloud publishing. For publishers, they have such a huge incentive to end things like used-game sales, retailer middlemen, paying for manufacturing of goods, fighting over limited shelf space and piracy.

If you follow the trends of other similar industries, it's easy to see why people predict this. Music went digital, who buys CDs anymore? iTunes alone is a multi-billion dollar industry. Movies and TV shows are now following music through services like Netflix and Hulu. I doubt physical copies will ever go away completely, but for the vast majority they will become irrelevant. I think the infrastructure for making it happen fully is at least 2 console generations away.

[Next: Do review scores really matter?]

The Scribblenauts franchise has sold over 2.5 million copies to date.

Are developers as obsessed with Metacritic as publishers? Or do you look at each review individually?

Think about it for a second, you just made something you’re very proud of, worked so hard on and poured your soul in to for years! Of course you want to see people’s reactions and of course you want to read reviews that will either excite or enrage you. But in today’s ADHD society we just want the instant discourse of “the number”. I think developers put too much emphasis on Metacritic, it’s great to get the general quality feeling of a game, but that’s about it.

Ultimately, do you think review scores can affect how a game sells? Or are sales largely dependent on marketing budget nowadays?

Neither, game sales are mainly dependant on one thing: word of mouth. This is true for all products; friends influence each other more than anything else.

Review scores are good for easily quantifying the quality of a game in a distilled form. If you say a game has a 90 Metacritic then that means that as a product it’s probably very well made. If it has a 60 Metacritic, it’s probably rather sloppily made. What it doesn’t tell you is if this game is for the mass market or some niche audience. And that’s what determines sales.  There are examples of great games that don’t sell and sloppy ones that do sell.

What marketing actually does is get the product in front of as many eyeballs as possible before the game is out. So people are aware that the product exists for them to purchase. However, at the end of the day if the game isn’t compelling to a large number of people then it has a sales ceiling. The day one and week one purchasers will tell their friends not to buy the game and the sales will dry up quickly.

Often times, whenever a developer or hardware manufacturer introduces a new way to play a game or a new feature, gamers quickly write it off and say it’s not for them. Do gamers really know what they want? Or do you feel part of your job is to show gamers what they want?

Henry Ford once said, "If I asked people what they want, they would say a faster horse." I love that quote so much because if a car wasn't better than a horse, no one would buy it and the car would have died and we would all be riding horses still.

Our job as creators is to simply put our creations out into the world and hope they fall in love with it the same way we did. Consumers always vote with their dollars. If they don't like what they see, they won't buy it, it's that simple. No amount of marketing is going to change that.

What excites you the most about the games industry going forward?

The biggest thing that excites me is the incredible growth in all the different platforms in only a few short years. When I started the term "indie developer" didn't exist. Neither did "digital distribution", "free to play" or "social gaming”. The time frame we are in right now is a really incredible time for developers and consumers. It’s completely win-win. Only dinosaurs who fear change and can’t adapt would say otherwise.

What would you say worries you the most?

It doesn't worry me as much as bothers me that a lot of people on the executive and decision making side of publishers doesn’t actually play games, nor have they ever developed a game. This wouldn't be a problem normally, but a lot of the time those people start telling you how to make games. Now, this isn’t a blanket statement, of course some execs did come from dev backgrounds and some love playing video games.

Anyway this kind of boggles my mind, why are you in this industry if you don’t love games? Think of it like the military, every general went through training. It might have been through officer candidate school or boot camp, but they all know the basics of fighting. How to shoot and field strip a firearm, how to dig a foxhole, how to work as a team: the basics! Thus when they are at a high level and give orders they at least have an understanding of what it’s like to be in the trenches. In game development a lot of misunderstanding happens with what’s feasible in a proper schedule and not insane crunch or what’s fun so you’re not just reacting and saying, “Well, Call of Duty does it, so throw it in our RPG!”

What’s more important to successful game development today? Having good ideas or adequate funding?

It’s a bit of both really. My big buzz word lately is “compelling”. You need to create something compelling for people to take interest in it, for people to want it over something else. That means it should be an idea people are excited by when they see it, so it’s got to be a good idea and it needs the financial backing to be executed well. If you look at the top studios in the world, they are typically very well-funded.

[Next: Is the traditional $60 retail model for games broken?]

Hybrid hits Xbox Live Arcade in 2012

Do you still see room for growth for traditional handheld gaming devices, such as the Vita and 3DS, or is mobile gaming on iPhone and Android putting an end to those?

I think it’s a content perspective. What I mean is, $0.99 titles aren’t going to replicate the experience of a $30 or $40 title. The iOS market has pretty much proven that if you want to be successful it’s either go freemium or $0.99 and for big publishers that’s not really worthwhile. HD Tablets are getting hot these days because you can potentially offer bigger budget experiences on bigger budget titles. The handheld market has changed. The DS never had the competition that the 3DS has now. Will it or the Vita thrive? If Sony and Nintendo can give the market what it wants, then yes.

Is the current business model for traditional video games – the $60 boxed game – a broken model?

Yes, the $60 boxed game is a broken model. It was always broken, it's just more broken now because games cost so much to develop, produce and market. Before the model was tolerable, because the cost was reasonable enough to allow mediocre selling games to make money. Now it's just insane. If you aren't going to be a mega hit at $60, you might as well give up before you even try, because it’s tens of millions down the hole.

Think of it this way: Homefront was an okay FPS – not great, not terrible, just okay. But as a consumer, why would I want to play an okay FPS when I can play a bunch of great FPS titles for the same price? And that's what the consumers did. While over 13 million people bought Black Ops last year in the US alone, smashing records, less than just 1 million people bought Homefront in the US. The consumer voted with their wallet, right?

But what if you could rent Homefront for $4.99 for 24 hours from your console? What if Homefront was only $30 dollars upfront for the single player and if you liked it you could buy the multiplayer for an additional $30?

All of the sudden it's not a binary purchase option anymore. Where before you had two options as a consumer, pay $60 or pay $0 for the AAA experience or the okay experience. The market proved that gamers were not willing to pay $60 for Homefront the same way they were willing to for Black Ops, so that is out of the equation.

That doesn’t mean all games have to go this route, there’s still room for the AAA only, but a lot of titles should try a different method. It's a win-win scenario for everyone involved.

Why did you delay Hybrid from 2011 to 2012?

Since it was self-funded we wanted to take our time. We’ve learned a lot as a studio over the last two and a half years on this project.

The shooter genre is really hard because there’s such a high bar for quality to compete against. Even harder still is that that bar is defined by nuance and subtlety. It’s a genre where something as simple as aiming and shooting take months of work to get right. We’ve spent so much time just working on making sure you can easily and smoothly move your crosshair and ensuring close, medium and long range combat all feel good. We know in this genre people are used to the best, and they expect it and you’ve got to deliver, it doesn’t matter if it’s XBLA for $15 or full retail price.

We have a lot of new stuff to show on it and I’m really excited for our reveal next year.