Opinion – Sequels Are Vital To The Video Game Industry

by Mike Futter on Feb 20, 2014 at 10:36 AM

As some of our readers know, my path to Game Informer was not via a traditional journalism route. My background is in business and arts administration. One of the intersecting lessons from those courses of study is the need for reliable, sustainable cash flow. The business term is “cash cows.”

In theatre, that’s the yearly run of A Christmas Carol. In dance, it’s The Nutcracker. Same performance, different cast, every year. And audiences gleefully buy tickets and pack sold-out houses.

The video game industry has its own version of that phenomenon: sequels. Our world is cyclical. A game is released, it performs well, and we get more of it. For the first two or three laps, consumers are content. The only difference between the video game consumer and the theatergoer is that, eventually, gamer resentment sets in.

Visit any forum or comment section when a new Call of Duty or Assassin’s Creed story hits and you’ll see some readers lamenting the annualization of familiar franchises. What they fail to consider is the predictability of these series at retail allows greater flexibility in the portfolio.

Ubisoft is ambitiously pursuing Tom Clancy’s The Division, The Crew, and Watch Dogs, and it’s able to do so because Assassin’s Creed has momentum. Activision can afford to let Bungie take its time perfecting the complex systems in Destiny, because Skylanders and Call of Duty keep them flush.

In time, these intellectual properties become new iterative series on their own. Watch Dogs will likely become on ongoing franchise, possibly taking the place of Assassin’s Creed should that fan base stray. Destiny is already positioned as having at least a 10-year life, and in that time Call of Duty or Skylanders could fade, just as Guitar Hero and Rock Band did.

Of course, not every sequel is an annual one. For some publishers, spacing out installments leads to even bigger gains. Take-Two turned its financial performance around thanks to Grand Theft Auto V’s $1 billion in three days (and so much more after). The new release in turn helped drive people to past GTA titles, making back catalog almost 15 percent of total net revenue last quarter ($113 million of $767 million total net revenue). 

Take-Two will continue to annualize its NBA and WWE franchises, and these reliable products enable them to take a risk on games like Turtle Rock’s Evolve and 2012’s XCOM: Enemy Unknown from Firaxis. For every “tired” franchise that hits shelves each year comes the means to take risks on new, ambitious games.

As costs continue to rise and the middle-ground is eroded in the halls of large publishers, we can no doubt expect to see success placed on the photocopier. However, to write those iterative experiences off as detrimental to the industry is foolish. They are the only way publishers can insulate themselves from riskier ventures.

You might not enjoy seeing Call of Duty on the shelves each year. It’s entirely possible you don’t understand the allure of Skylanders figures. You might be tired of taking leaps of faith in Assassin’s Creed games. But when you play something fresh that takes risks and succeeds, remember that it was made possible in part by publishers capitalizing on past success.