Unfinished & Unstable: How SaaS Changed Video Games

[@ModernMBA]

If you enjoyed this, check out our latest episode on How GameStop Fell Apart in 5 Years: kzbin.info/www/bejne/p4OsqpSHgc59opY 0:00 Software is Eating the World 10:39 The Isles of CDPR 17:28 The Curse of Square Enix 22:09 I Never Asked for This 28:05 More Money, Less Titles

[@RoshDroz]

Fromsoft is BAE

[@Turbotundra]

your videos are consistently bangers. keep it up bro

[@CodeguruX]

Yeah, it works. Just not on me. lol

[@allthethings3071]

It wasn't because anyone wanted SaaS it's because software came under copyright, aka the public didn't get property rights so they started stealing the multiplayer networking code. SaaS is fraud plain and simple, which is why every "online" game you ever played was mysteriously downloaded to your pc.

[@jaber5345]

What a worthless video lmao

[@anonony9081]

I think companies are going to learn really quickly about software as a service fatigue. There's only so many ongoing games and services I can keep up with in my head and only so many I'm willing to pay a fee for on a regular basis. I'm at the point where I'm actively looking for games that don't work as a service and putting my money towards them because I know at least Theres a good chance I'll get a complete product and I won't be strung along for months and months

[@Peteruspl]

SaaS in streaming went great when you had Netflix and HBO. Now with 20 services I bet its not so rosy for them. Also with interest rates rising all over the world, investing upfront in content to make your SaaS attractive and than pricing modestly to get back with volume and loyalty may be a loosing proposition. There will be some examples of great success but what's the % of failures who moved to SaaS to see much less revenue? I think streaming movies is one, though Cov19 had its own massive impact here so its not clear how much streaming is to blame.

[@allank3527]

This is why PlayStation won’t have the same subscription as xbox knowing they can only make good quality games that way.

[@F2t0ny]

Yup, I only play games that end now.

[@mdd4296]

The problem is if those are the only thing most people are aware of and/or have access to, it becomes the effectively their only choice. Look at the asian market for example and how unabatedly shameless their monetisation are. They have gotten used to that. Ironically if you introduce what we consider reasonable progression and service there, the core audience might complain.

[@iinsaniity6729]

This is why I stopped playing Destiny and then Destiny 2. After some time, it gets to be a drag knowing that as much as I love Destiny, I couldn't bring myself to constantly pay for expansions while the library of games that I wanted to play kept growing.

[@MilitaryHistoryGearReview]

It is always fascinating to see the numbers behind sometimes incomprehensible decisions like releasing unfinished games or shoehorning in overpriced skins.

[@Runefrag]

Don't really need to see the numbers. The intent of "Greed" will shine strong and true through any fog of doubt.

[@iTzDritte]

Great vid. I miss when the entire gaming industry’s focus was on making fun games, rather than financially exploitative games.

[@zojirushi1]

Pretty much every industry once they realize they want to try to milk as much money as possible from fans. :/ Now indie games are where most of the fun games are at.

[@hansennoah1]

@@zojirushi1 on the brightside amazing indie games cost like 66% cheaper on avg than cashgrab annual triple A games

[@zojirushi1]

@@hansennoah1 yeah

[@angrylundy4862]

90% of all games tru all of time have ben shit

[@sufurt782]

@@hansennoah1 indie devs aren't saints either

[@Geekmandem]

Thought it was a shame not to see the Witcher 3 DLC highlighted and how they impacted revenue. The two DLCs (especially Blood and Wine) were considered better than most full-release games. For as little as £15 for the pair.

[@yourlocalhuman3526]

Loved Witcher 3 man. Bought it last year and was pretty much the best gaming experience I had in years

[@arnowisp6244]

Those DLCs are better called expansions for what they were.

[@HanSolo__]

Also, the latest highest sale numbers were connected with the Netflix show. It only showed how many people were too lazy to look out for the game, which they eventually loved. I'm finishing it the second time with Blood and Wine final fights. I don't regret any of the 900h it took me to play it on PS4 and PC.

[@HanSolo__]

@@arnowisp6244 They should make games like witcher. Not the shitty SAS or something.

[@mortache]

@@HanSolo__ Sadly the quality of Witcher 3 is probably due to slave labor level of crunching, even that from a smaller economy where stuff costs less.

[@alhypo]

Yes, this all makes sense. This is why I rarely buy a game at launch. I'm tired of getting burned by hyped up games that are incomplete at launch. I generally wait a year or two after launch before considering buying a game. And CP2077 is a perfect example of why I wait.

[@xxff6452]

CP2077's my first pre-ordered game, and maybe my last one🤣

[@marcusclark1339]

@@xxff6452 never preorder, its never worth it, the game will never disappear especially if all u get is AAA games and even then it'll be back, never have FOMO fear of missing out syndrome, its not worth it

[@afaqahmed43]

@@xxff6452 same

[@MyH3ntaiGirl]

​@@marcusclark1339i bit it three time Watch Dogs (yeah.....) Fallout 76 (at least the merc is kinda cool) CP2077 (a company i trust largely due to Witcher series....betray me to such a level, fk them) I probably gonna pre order two more time , Fallout 5 and TES VI, mostly because the franchises give me such great experience overall I probably play Bethesda games for thousand of hours already

[@ZeroTheHunter]

@@xxff6452 1 week before release, i was about to preorder that game, the first preorder of my life. I was so excited because it reminded me to Deus Ex but on steroids. But i had a last minute throwback and purchased Forza Horizon 3 Deluxe instead. I was happy with the game but i had some regrets thinking how good cyberpunk would have been. Imagine my jawdrop, looking at how awful was CP2077 and how even ps1 games were better than that game. I cried internaly knowing how close i was to buy it.

[@tubz]

What people forget is there is an absolute huge amount of fun, interesting, innovative games made every year. Just in the indie space not the AAA space

[@nethowarrior3294]

games that are like, 15$, no less!

[@Cynsham]

People are too busy getting angry at AAA studios for shit launches but they ignore hundreds, if not thousands of great indie games

[@Skeletons_Riding_Ostriches]

Also, Indie studios usually can't take the risk or don't have the funds of setting up GAAS games or games that are unplayable without their central server. This is an AAA problem.

[@ContrastCopy]

@@Cynshamthese people spend more time raging than actually playing games. Play! The! Game!

[@GyroCannon]

I hate the SaaSification of everything, mostly because I believe that the way where both companies benefit and consumers benefit is a “perpetual fallback license”. As much as I hated using Jetbrains’s IDEs at my last job, I respect that I can have SOME version of the software if I decide to no longer pay them. Contrast that with Adobe, who want to keep taking your money every month. Or worse, artificially restrictive ecosystem lock-ins, like chips in ink cartridges.

[@checker297]

i think it was more that publishers are monetizing existing features, rather than monetizing new features. Steam also having a refund policy is massive as it has stopped a lot of the bugfests.

[@hundvd_7]

>I hated using Jetbrains’s IDEs I'm genuinely surprised. I have never met anyone that didn't at least _like_ JetBrains' stuff IMO their quality control is awesome and their design is leagues beyond the competitors There's no other piece of software where I regularly use _literally_ 100+ hotkeys, for example. No other software has enough features/comfortable enough combos

[@GyroCannon]

@@hundvd_7 My main complaint has always been how bloated it is, even after I disable 90% of the plugins (that I don't need or asked for...) That said, I just started a new job, and I ended up downloading Intellij IDEA to work on a Python + JS stack because shelving changes is sooo much better than git stashing... so I guess I don't hate Jetbrains products as much as I thought lol

[@khromem]

Lol you wanna use a product that the company has hired thousands of engineers to make, but are mad they want you to pay for it?

[@GyroCannon]

@@khromem Where did I say that I didn't want to pay for the products that I use? I literally never said any of that.

[@aperson-ep8rl]

I really enjoy the more thesis driven approach this channel is going for. I feel like compared to channels like ColdFusion and Company Man, while production may not be as polished, this channel gives more insightful analysis of information. Where as I with the channels stated previously I get bored because they feel more like information dumps. Thank you for the content and keep up the good work!

[@thomasdawe1837]

True

[@shawnz12ss]

I like both examples you listed here but I think you summed up why I rarely finish a whole video from either with ‘info dump’.

[@aperson-ep8rl]

@@Lucie_PinkBandit hmmm if your two main points are that the difference between these channels are that modern MBA doesn't do company specific videos and only focuses on the present I don't think that's true. You can just do a quick look at the titles of videos and see that isn't true. If you come up with any other reasons why this isn't a fair comparison though would love to hear them!

[@aperson-ep8rl]

@@Lucie_PinkBandit that's an interesting take, but I'm not sure you can do anything with it though. Like I'm not exactly sure what an apples to apples comparison is if you don't think its fair to compare mcdonalds to burger king on who has the better burger. My comparison between these channels was: 1. How insightful was their analysis 2. How entertaining are they to watch And I think given the vast similarity in structure and topic, it's a fair comparison to consider.

[@Lucie_PinkBandit]

Nope this isn't worth it 🛌🏽💤

[@TheHipClip]

The problem with CDPR and CP2077 wasn't only that they pushed an unfinished game but they manipulated reviews by not allowing reviewers to show their own footage. They also cut previously shown mechanics/content in promotional material, i.e. false advertising.

[@eurosonly]

And fanboys said it was the last bastion of good corporate leadership. Companies don't just want money, they want all of the money and in as least amount of time as possible. They don't care about ethics or the consumer.

[@HULK-HOGAN1]

They scrapped half the game (multiplayer) and simply fixed the other broken half. They made the huge sales of a singleplayer + multiplayer game, but only delivered half.

[@ChadVulpes]

True enough, but it adds nothing to the argument and it stands as it is.

[@twenty-fifth420]

⁠@@eurosonlyI mean to be fair, and I know this is according to some people, a cherry picked copout or something but that is the purest essence of capitalism. It is just exceptional because CDPR marketed *themselves* as “we are not like the corporates like Epic, EA, Activision-Blizzard etc etc”. So it was exceptionally fucked up. The only ethical consumption as far as I am conerned at this point is good meaning smaller and indie studios, How I want to get into lol. 😂

[@Vallinen92]

@@twenty-fifth420 There is no ethical consumption under capitalism.

[@alcedob.5850]

I think the main issue is that managers do not understand that they need to differentiate mmo live services and single player games. Including live service models to single players is never acclaimed positively. But they look at the most profitable games and make the developers cargocult-esque implement unfitting features

[@fictitiousnightmares]

Agree. I hate that Diablo IV is a 'live service'. Never should have been.

[@thomasd5248]

​@@fictitiousnightmaressadly it's the most profitable Diablo ever. So you can be sure that every following Diablo will be worse.

[@Skumtomten1]

​@@thomasd5248The problem is simply that gamers are stupid, and one of the best target audience a company can have. Granted, alot of them are kids, but even teenagers and adult that are gamers tend to have extremely low threshold for resisting the temptation of a new shiny game. Making false promises, lying and creating fake hype is too easy for this audience, and they seem to completely forget about a terrible game and still buy the next iteration. Companies even openly hate their customers yet still sell record levels soon after. Tell me any other industry that could act in a similar manner? Publishers and game studios realized this, and keeps abusing established brands and IPs to their advantage knowing these will always perform well. It is a saying that building a reputation takes a very long time, and can be ruined in an instant. This doesn't seem to apply to the gaming industry, or there is a severe delay until it happens at least.

[@jasonmension3979]

I think the main prob is the people calling the shots on these games arent gamers. They make decisions off numbers they read off screens, rather then them wanting to make a game for themselves. I just wanna see a game director actually communicate with its audience and not just take feedback but get so involved that they understand the feedback

[@emptyshirt]

That still happens with indie games. But those don't make it to console until after they succeed.

[@nviox5720]

The main problem is that we (as a community) simply keep buying that shit, if we didn't these companies would stop doing increasingly abusive practices.

[@bruhtholemew]

@@nviox5720 That says something about the greater community then. The people who don't like these practices have become a vocal minority. For every person you see call out a game for having predatory mtx, you'll have a hundred people shoot back with, "who cares", "just don't buy it", "broke?".

[@nviox5720]

@@bruhtholemew Completely agree

[@jojomicheldu59]

@@nviox5720 Stop saying "as a community". The vast majority of people who buy these cash grabs are normies who don't interact with video game communities online. We can't do anything about this.

[@thenot-so-smartfox4145]

FINALLY! A video that talks about the numbers behind the incomprehensible mess that is the industry right now. It's crazy to think that Square enix, even with all those prized titles they put on the market, was not making nearly enough to pay for the production of them. Something is clearly wrong if you are making some great and acomplished games recognized by the industry and still not making money.

[@vietnamabc2290]

Same with films mate, there's a reason most classic hits only really appreciated years later when the originals maker got kaput. Modern gamers nowadays don't realize how good they are if given a good traditional made game

[@awijaya2116]

This video doesn't actually tell us anything we haven't already known, but it's nonetheless useful for contextualizing how the video game industry's changed over the past decade. It's also interesting how the industry's also become steadily more consolidated as AAA budgets balloon and IP becomes the key selling point (it kinda mirrors the film industry in that regard IMO). Another 10/10, this channel really deserves more subs. Also, have you given any thought to monetizing these videos? Sponsorships, or a patreon at least?

[@porkchop3989]

Really great video, especially for people like me who's generally really into videogames but doesn't play or read that much videogame content anymore. I only knew about the major mainstream duds like Avengers or CyberPunk but didn't know about the history of 2K and SquareEnix. Didn't even know they made a new Deus Ex after Human Revolution! Damn seeing that game being more than 10 years old makes me feel old.

[@charlie_andrade]

Honestly wouldn’t say the point of the channel is like “takes” or something around that, I think it’s as the title says a “Modern MBA” Very great tool for those interested in learning more, or etc

[@ModernMBA]

Thank you for the kind words and support! It truly does mean a lot to me. The overall entertainment industry as you've very accurately pointed out has followed the same fundamental change. Less risk-taking, less creativity, more reboots, and a strong preference for stable, safe cash flow over moonshots. While there's no one cause, I do think the strong stock market in the past few years has deeply influenced executives and decision-makers at large companies. I doubt any executive would ever admit it, but when your compensation is so tied to equity and you've seen the insane 4-6 year bull-run of so many tech stocks (nearly all subscription / service based businesses), it's very hard to not subscribe to those trends. With the impending recession and the bull market coming to an end, there's a chance we may see a reverse back to tradition - for the better. Monetization isn't the priority. My focus is to make better content (better editing, audio, balance of insights / information / analysis, more frequent episodes). Similar to Take-Two, I think monetization and viewership will naturally take care of itself with great content. Once the first season wraps up (4 more episodes to go) the current plan is to spend a few weeks convert the S1 into podcast form before diving into S2. Would also be a great opportunity to remaster some of the not-so-great audio from earlier videos.

[@porkchop3989]

@@ModernMBA hey man, nice to see you replying to comments here. Who are you looking to invite to your podcast and what will make Season 2 stand out from Season 1? Very excited overall for the future of the channel.

[@ElijahOyekunle]

"anything we haven't already known" Who is "we"? The target audience of this video isn't just gamers.

[@EpicWin1337]

Basically deliver a good product and design your monetization around that product. I think an important case study is blizzard where they started as a SAAS model with World of Warcraft but the inclusion of micro transactions leveraged increased revenues despite a decrease in playerbase.

[@divinecomedian2]

The decrease in playerbase was due to delivering a crappier product in subsequent expansions. They shot themselves in the foot.

[@michaeltorrisi7289]

@@divinecomedian2 This. What Blizzard excelled at (once upon a time) was taking a game genre someone else pioneered, making it a little more newb friendly and pushing it out the door. Like "oh, this Age of Empires thing is pretty cool, here's our take on it called Warcraft" or "Everquest has a rabid fanbase, but if we make it a bit more accessible and call it World of Warcraft, we can rake in the profit." Their problem is that in their quest to push the games to a larger base, they made them TOO newb friendly. A video game is, at its most basic level, a Skinner box. You push a button, you get a little hit of dopamine. What determines a game's success is how engaging the maze on the way to the button is. If you're just pushing the button, you quickly get tired of the constant rewards. Balancing effort and reward is the key to a good game. Blizzard would make good base games, then inevitably, due to feedback from squeaky wheels, they would ratchet the effort down. This allowed them to capture more and more casual gamers, but the problem with that, and its one that you won't see in sales figures or sub counts, is that in capturing that more casual market, you're losing your hardcore market. The hardcore market can be captured indefinitely, the casual market, no matter how good the game, is going to bounce around from game to game. So for more rapid growth, you're putting yourself in a position where you have to continually attract new players. If they focused on retaining their hardcore base, the growth would be slower, but they wouldn't have issues with their games falling off in popularity. People like to point to WotLK as peak WoW, but really, it was the beginning of the end. WotLK saw explosive growth because it was friendlier to less invested gamers. It was both less mechanically difficult and required less time investment to complete content. However, when you cater to less invested gamers, your player base becomes *less invested gamers*. Cataclysm bombed because they tried to ratchet the difficulty back up, but they'd already alienated their initial rabid fanbase and those players had moved on to other, more difficult games. The short term gain from WotLK cost the company money over the long run, but the structure of C-suite pay means that companies are continually going to favor those short gains over steady long-term growth. Blizzard games suck, and have sucked, not because of Activision or Bobby Kotick (although the man is an ass), but because their releases are aimed at too large of a market and don't create desire in competitive players.

[@ECAPS.]

@@michaeltorrisi7289 I honestly believe Blizzard went to shit because Activision acquired them in 2008. What's the last great expansion? Wrath of the Lich King? I remembered Cata came out and people didn't like it as much as compared to WotLK. Blizzard was already falling apart after the merger. Diablo 3 with all of its faults, Overwatch with lootcrates. WoW and it's lackluster expansions soon after. So yeah, the merger really did fucked Blizzard wayyy back then. A slow fall from their peak.

[@janusface6628]

Really excellent presentation and analysis. Helped me understand the economics behind the gaming industry much better. This is the sort of quality one might expect from 'professional' media. But whenever CNBC attempts this sort of piece on a specific industry its quality is far inferior, riddled with errors and lacking the sort of coherence we find here. Also really appreciated the fact that you covered non-US companies.

[@jokesterthemighty227]

I don't think Saas is about just the recurrent fees, it's more about fast user acquisitions thus warming up more and more capital. It's never about the product, it's always about the user numbers

[@gamingtime9716]

The issue with Square Enix's plan is that they forgot to make good games, and their monetization got in the way of making the games good. That's always been the baseline, and no fancy business plans can get around it: make good games. I'm surprised that big studios have gone the way of making more games for cheaper, still being able to bigger games than indie studios, but at a reduced cost compared to current AAA games and with more opportunities to fail. Try new IPs, have smaller teams, and make good games.

[@17thshard62]

Yeah, it's pretty bizarre. Maybe their management cut their teeth on cell phone games where you can just milk the gambling addicts for all their worth, but when you enter the ring with anything indie-adjacent, you end up getting compared to teams who are able to do way more with way less - as Avengers and even FFXIV show, the core gameplay loop has to be worth someone's time even when you have the most popular and monetizable IPs out there.

[@rodryguezzz]

They are extremely incompetent. Year after year they keep complaining that their games undersell. I mean, you can't always get lucky and sometimes things go wrong, but after so many underperforming launches, they should look at themselves and figure out where the problem is. Too bad they were so up their asses that they were not able to see it. Now they completely got rid of their franchises. At least I know Embracer is a good company and knows what fans want.

[@thirdcoast6513]

This video didnt mention how well ff14, a paid/ftp saas game, and ff7 remake sold very well for square.

[@burrybondz225]

@@thirdcoast6513 it did tho?

[@thomasnielsen5580]

@@thirdcoast6513 FFVIIR is a masterpierce, so the consumer saw quality. I think their biggest mistake in terms of their SP games are not the live service thing, but that the games are not good at all even without the microtransactions. the 2 first Tomb Raider games are dumb versions of Uncharted with more yelling. Just Cause 3 is stupid and so devoid of meaning that one game is enough for the consumer (for those who like dumb fun). Then there is Sleeping dogs. I had fun with it and it had a unique setting, but everything was done much better in GTA IV 4 years prior. It also suffered from a dull story, and even though i played GTA V and IV before, i remember those stories, while Sleeping Dogs is completely forgotten. This is not an Square Enix isolated problem. It exist within all the major players except Sony. It's a punishment for trying to make the games as generel as possible to attract as many consumers as possible.

[@GlennRRB]

Hi. Just wanted to thank you for the amazing video. I work as an indie developer and head of a tiny studio with other few ppl making mobile games. The lessons of this video have so much value for me. One of the best essays i watched this year. Great job and thank you again.

[@TKVirusman]

That "transformation journey" slide from CDPR is absolutely terrifying. They are literally saying that in every way besides increased team focus, they are making their product objectively worse.

[@ecco710]

timestamp?

[@FunkyMunky1137]

@@ecco710 16:26 I believe.

[@desuordie4856]

Not necessarily making it worse. They just did it poorly.

[@mwal223]

I don't think you know what objective means

[@Xld3beats]

Everything except putting trust into those individuals. You're just numbers on a spreadsheet, there's a chance it won't be great so we won't give you that chance.

[@Maniacsurvivor]

I don't like how Agile is portrayed as a reason for broken games in comparison to the Waterfall model. Let me tell you that the percentage of failed waterfall projects in comparison to agile projects is insane. It is true that agile development enables early selling, but that's a management decision and is not a reason to sell broken software. In the end, it is greed. But agile development is so much better than waterfall. There's a reason most projects are done this way these days. Agile enables to steer the ship to its right location and waterfall does not. Like your videos a lot regardless ❤️

[@Solo2121]

I couldn't agree more with this and disagree more with the video (though it is still a good and well thought through video). I think the real issue that everyone glosses over is the crazy scope that modern games have vs the old monolithic/waterfall model games. And even though dev teams are much bigger now more devs != more/faster development. So in my opinion I think the issue is that the scopes have increased significantly but the dev timelines are still the same. Compare the scope of BF4 to BF2042, not "how many maps and guns" but the functionality they were trying to implement throughout the game. Something that seems simple to add like vaulting it a pretty big lift in reality but execs and customers don't know/care so it gets added to the launch features and given to a team that's in charge of soldier traversal. When that team understands how big of an ask that is but they aren't given any extra time than they were given for BF4 really so they really don't have a choice but to push out some things unfinished but in mvp state and just "fix" it later. That was just an example and not what actually happened (they did have an extra year for BF2042 I think) but the point stands. There is just no way to get everything that we, the gamers, want in a game at launch without extending dev time for these games. Moving back to the "good ole days" would just lead to us complaining about how bare all these games feel instead of unfinished. The core issue is time.I don't care what model you use, you aren't building BF2042 in the same time it took you to build BF4, not even close.

[@checker297]

@@Solo2121 i mean, both methods have their advantages. IMO the best is a combination of the two as important milestones have to be hit, but if you have people who are stuck on one project they can move to another

[@reclusivegamer3609]

As a software engineer, I agree completely. The video basically calls out agile as one of the main factors and then holds the old school waterfall methodology on a pedastal. This is asinine. Senior devs who went through the waterfall approach are well aware of its flaws: being incapable of change when software requirements are constantly changing. It takes a genius to work out the optimal software design in a single iteration. While agile isn't perfect either it allows teams to pivot when things that was initially thought as a good idea turn out to not be so good. To a layman, anything that happened in the good old days might sound like a good idea but it's certainly not the case. My personal opinion is the decreasing quality of software is likely attributed to management (chasing after new record profits each quarter) and product teams not being on the same page. There's a bug? How many users is it going to affect? Is it going to reduce our revenue vs if we delayed the release? No? Then ship it.

[@ModernMBA]

Hi Philip and everyone, I've been heads down on the next episode but wanted to take a moment to quickly chime in on this thread. Thanks everyone as well for the thoughtful comments and sharing perspective. Discussion and debate like this is far more fulfilling to me (personally) than view / subscriber counts. My intention wasn't to portray agile as the reason for the declining quality games. The coverage of the software development models was meant to explain the R&D evolution happening behind-the-scenes that supported the customer-facing trends (cloud updates, services, digital distribution). Will reflect on how I could have worded / scripted it better. Your comment is wonderfully spot on that ultimately, it is greed and poor management that directly leads to shitty outputs, not the model of development. For every disaster under agile, there are plenty more examples of games that went wrong under waterfall e.g Duke Nukem, Watch Dogs, Cyberpunk, Madden, COD (sans MW). As someone who has worked in the trenches first in engineering and then in management under both models, I personally prefer agile. Agile is more forgiving from an R&D perspective but also unfortunately (to your point) welcomes greater "tolerance / influence" of poor management. ReclusiveGamer's point is also on point. The unfortunate brainless MBA-fication of boiling everything down to cost / benefit analysis has meant that product teams have lost autonomy over time => less bottoms-up decision making => more top-down mandates. And until the numbers actually go down (which they rarely ever did in the past 4-6 year bull run), the top-down decision consistently wins.

[@reclusivegamer3609]

@@ModernMBA Brilliant reply. Took the words out of my mouth.

[@SPONGEBOB20]

Great video that goes into a lot of depth. Another point I would add is looking at strong sellers from Nintendo or Sony family of developers. They still stick to the model of make a complete product for one full price that you buy at the store or digitally. Games like the main Super Mario or Zelda titles, or on Sony's side, God of War, The Last of Us, etc. These games usually sell extremely well and receive critical acclaim for basically doing the opposite of the live service model, but extremely well and worth your time and money. While they both still have DLC attached, such as the Breath of the Wild expansions for the last Zelda game, these are 2 core bastions that do not follow the model for their largest releases and still see success and acclaim. I like both kinds of titles and definitely see their fit in the industry. Makes it easier for me to decide what to spend my money on up front.

[@mdd4296]

SIE dont make the majority of its money from these titles. Most of their revenue are actually SaaS: PS Plus

[@thomasnielsen5580]

@@mdd4296 and more importantly, consol sales. Otherwise no money. In that way, they do not care much of game sales, but more that quality is produced, so more people buy consoles, buy ps plus and lastly buy their games.

[@Dhalin]

The problem with Nintendo is that they are too insistent on making gimmicky stuff instead of just focusing on their games, the games that made them rich in the first place. They just wanna throw noodles at the wall, hoping something sticks. For every Wii or Switch, there's a Wii-U that just flops. They would make an absolute crapton of money if they'd just go PC like everybody else did and focus on games. Hardware dev is prohibitively expensive and difficult, and people are tired of limited-time stuff that's going to go away in the future. And of course, they attack people who wanna emulate to continue playing games they paid for.

[@Slawa_Saporogez]

Sony's examples are way too cinematic, therefore do not distinguish between eachother.

[@FLCLimaxxx]

Sony loses money on all their games because they spend a movie budget, Sony is actually propped up near completely by SaaS games Call of Duty and Grand Theft Auto. The overwhelming majority of People who buy PS buy it for CoD due to the exclusive content deal with Activision. For example, Horizon series has probably sold 30million between both games by now but each game cost far beyond $200M to make. Nintendo’s billion dollar grossing movie cost 100M split between Illumination and Nintendo. I am betting that Zelda cost a fraction on Horizon to make. Sony is in fact trying to stop Activision merging with Microsoft even though they know that they will STILL get Call of Duty on PlayStation. The reason is what they won’t get is exclusive game content anymore, so less reason to funnel into PS for their biggest consumer, Call of Duty fans. Sony may not have their own SaaS but they absolutely rely on SaaS.

[@AcidMayo27]

You didn’t mention how take two’s biggest money makers have upset fans with their lack of updates (two per year) and in the case of gta online, the updates do not fit the theme of the game at all. They’re just milking the fanbase for all it’s worth and putting out garbage like gta+. Also, terrible post launch support for red dead online. Nevertheless, that might’ve been outside the scope for this video but it was very informative and well made. You earned my sub!

[@lycanwarrior2137]

Not to mention the abysmal quality of the GTA remastered trilogy and the next gen "upgrade".

[@qonf]

Saas and agile are orthagonal. You can develop a SaaS via "waterfall" and a traditional software product with Agile. Furthermore, very few companies would ever describe their process as "waterfall". Although the word has a history that predates the agile community, "waterfall" is a term mostly used by the agile community to describe what they see as the problematic process that agile addresses. It's a derogatory term. To associate "waterfall" with quality software is ironic at best, as the people most likely to use the term would making the case that "waterfall" produces the wrong solution, to late. All that said. None of these terms mean much to acctuall software engineers. From a software engineer's perspective, these terms are mostly used by middle management to justify micromanagement.

[@HanSolo__]

I work in Agile and I don't give a shit about middle management. What they want, what they justify, what not, what they think and what they don't think. I just don't give a shit. Finding a replacement for me would take so long that it would ruin 2 projects in front of the clients. One goes to prod second is MVP and is at the direct clients' demo stage.

[@mattmurphy7030]

Waterfall is still taught in CSE degrees so idk wtf you're talking about

[@luisoncpp]

​@@mattmurphy7030he is right, is not rare for universities to be outdated

[@alhypo]

The thing is, they aren't really doing SaaS in the same way other software industries do it. In most cases, SaaS is a monthly fee that is charged for as long as the user is using the software. But game publishers are trying to have their cake and eat it, too, because they expect us to pay a large fee up front and then trust that they will deliver something playable in the next few months. If they were really committed to SaaS, they would just charge a small monthly fee to play a game. And if the player doesn't like it, they just bail after the first month. That gives the developers a strong incentive to actually provide something fun in order to keep players interested. The half-baked SaaS model they use now requires us to put way too much trust in their ability to deliver.

[@SavageGreywolf]

I'd love to say you're correct, except anyone who has used an Autodesk or Adobe license for professional software knows that your description of SaaS outside of videogames is not true at all.

[@Ansalion]

Not sure if players would actually be on board with that, since most gamers still expect to "own" the game when they pay money. If they ever come back to the game most gamers probably wouldn't like the fact that they'd have to pay all over again to play it. This would only ever really work with MMOs.

[@wojtek4p4]

​@@SavageGreywolf I think the most off-putting thing in live service games compared to professional software the is constant upselling. I'm not too experienced in professional software pricing, but I can't recall there being that many pricing options. Usually I see 3/4 tiers of pricing: "Free/super cheap", "The useful one" and "The everything we have" (usually including specialized tools only actual pros would have use for). The differences between tiers are significant, but it doesn't feel like people are being nickle and dimed. It also feels like the low- and mid-tiers consumers are getting developers' attention, not just the whales. With games, I feel like there's always more to buy. I could probably spend thousands on a game and still have some things I could spend money on. Because of this emphasis on upselling, I feel like I'll never be satisfied with my spending. So... I just don't. I refuse to engage in most microtransactions, because they'll never make me feel satisfied with the purchase. I'm okay with subscriptions/large-ish DLC because they're usually self-contained though.

[@pablonunes5896]

Really glad to have this video. I know how much video game development quality is slipping over time, but to have it though a business analysis lens, it makes more sense then ever. Not hopeful that trend will regress, but you never know. Great vid!

[@Johannes_GLA]

😊😅

[@zojirushi1]

Let’s go! I wasn’t expecting a video game related video for a while from this channel since most businesses covered before were big chains or brands. I had to do a double take when I saw this in my subscription since I watch other video game channels and thought it was from one of those channels instead. Was surprised and interested that it was from this channel, one that has quickly become one of my favorite channels. Keep up the great videos! :D

[@plaidchuck]

My biggest issue is with ballooning budgets because the studios insist on hollywood mo cap actors and voice actors for marketing purposes. The biggest culprit being keanu reeves for cyberpunk.

[@riplix20]

Everyone trying to be God of War lol

[@Tamacat388]

A single actor in a game is not the cause of ballooning budgets. Like so many games that dont have hollywood actors cost just as much or more. When games cost over 100 million having a hollywood actor is taking up like 1% of that budget lol

[@zuko9085]

While convenience wins for a time, eventually people will start to demand quality and reliability again. The pendulum will swing back towards something more stable. We are seeing this a lot right now with many live service games completely failing or being delayed to try to overhaul them.

[@Masata240]

Keep up your superb analysis of the gaming industry.

[@ModernMBA]

Thank you for your generosity and support masata240!

[@nymarius5100]

This video is basically an entire college lecture you'd pay for - great stuff

[@alisdair42]

Hi there, games design and production student over in the UK, can confirm that we are heavily pushed towards agile and pushed away from Waterfall, mostly down to any unknown unknowns, that we can defer into known unknowns. Software is still a pain to make as always, but being able to say that our burn downs are almost 100% is a good way to keep the lecturers happy

[@DensetsuVII]

Just found this channel, and very much enjoy the perspective on an industry I'm mostly more invested in on a consumer level. I do feel like you overlook some things though and I'm curious on your thoughts here: With regard to the industry I think the position of the traditional waterfall approach in the modern day is underrepresented in this discussion (ie, is SaaS taking over the industry). Nintendo still follows this approach with nearly all their flagships (honestly every one I can think of) and is highly profitable. You mentioned Square Enix and specifically call out their heightened revenue in 2021 but attribute this to Marvel rather than their flagship non-SaaS release, the Final Fantasy VII Remake the previous year, which sold over 5 million copies in a few months. I'm not saying Waterfall is the preeminent model for the industry today, but it seems misleading not to compare and include the numbers that the other approach has yielded as much as they're available. There's an argument in favor of SaaS that is also not mentioned here in the form of No Man's Sky - you mention its buggy release but not its continuous, free improvement over the subsequent years. Its reputation and revenue have been completely rejuvenated through its agile approach, which seems a massive argument in favor of agile which is missing from this discussion. And of course, while I understand it's outside the scope, the indie gaming industry is far less SaaS focused, but has a tremendous impact culturally on the gaming scene, with fans of games like Stardew Valley and Undertale, both multimillion sellers without SaaS approaches and mostly likely with high ROI despite lower overall revenue (because of correspondingly lower budgets). I would love to know the comparison with regard to indie gaming's share of the video game pie to contextualize whether indie gaming is going to be niche until it embraces SaaS or if it is in fact going to triumph over time because it doesn't. Again, really appreciate your analysis - I wouldn't be surprised if you were aware of these notions and I only bring them up because you seem very thoughtful and I'd love to see a follow up addressing these! Either way, I also loved the hotel video, will subscribe and hope to hear more!

[@noahlegall9478]

Please - PLEASE don’t stop making videos. These are just remarkable

[@Khorvalar]

It sounds to me like the problem is that many games nowadays are being developed by businessmen focused on money rather than being developed by gamers focused on making a FUN game!

[@eurosonly]

Always has been though. If a game did not sell well back in the day, they'd cancel the franchise. Sure, it may have been made by passionate devs who poured their heart and soul into it, but the history of shut down game studios and franchises is plenty. When was the last time a game flopped sales wise and they still put out a sequel?

[@RialuCaos]

@@eurosonly I believe the keywords are "focused on money." Wanting your product to be successful is not the same as focusing on increasing profit margins to the expense of everything else, including the customer's experience.

[@enot2140]

This video just reminded me how much I miss owning copies of products I payed money for and that I dread the day on which my digital "library" might become inaccessible.

[@kylespevak6781]

"In the future, you'll own nothing and be happy about it"

[@enot2140]

@@kylespevak6781 pretty much.

[@eneco3965]

You can always just get ISOs and put them on a drive

[@four-en-tee]

Support GOG then

[@arandompotat0]

Unreal engine is disrupting the video game industry. For game studios it wasn't as simple to just continue to pump a different game in in the same framework (engine) due to consumers demanding innovation and better graphics. They also had to develop the technology from the ground up. Nowadays we have engines that are SaaS, constantly updating and fixing bugs. Helping the development on games focus mor on the mechanics, style and storytelling. Almost half of the AAA games being developed are using Unreal Engine, Even CD Project has switch to it for The Witcher 4. And it's free (until your game earns more than a million dollars), which has empowered indie devs to make bigger and graphically impressive games. Unreal Engine is pushing real time rendering in many industries, you should cover it.

[@charmingpeasant9834]

In-house engines dying out and being replaced by Unreal is nothing to celebrate.

[@riplix20]

@@charmingpeasant9834I wouldn’t say calling it a “ disruption “ is a celebration

[@nask0]

Admirations, this is one of the most knowledgeable videos on the topic I ever saw and I am in this IT industry > 15 years. Great content, cheers 🎉

[@MyriadColorsCM]

Thank you for this fresh take on game development as it relates to software engineering practices, I honestly never thought about that despite it having such a direct correlation.

[@SaphemanPlus]

Thank you for providing insight on video games all while talking about software. It made so much sense when you listed the games studios and the games/IPs they released. I can take what I experienced from those companies and make predictions on their next games.

[@Sehr_Gediegen]

It is ridiculous how well narrated and edited this videos are - keep up the good work! :)

[@hahanottelling4184]

I got recommended your video about Airbnb, then looked into this video because it looked well-edited and researched. Subbed.

[@CkyGuy69]

Yeah it's wild how older games addictive qualities were due to it being fun and now they are designing the games to be addictive rather than making it fun first. It's like they are trying to create drugs that have no recreational value but are addictive and you'll buy more. Crazy.

[@blade6965]

it's not "like" that,it's EXACTLY that

[@G-Mastah-Fash]

They wanna create digital cigarettes

[@bruhtholemew]

We've already got a nice symptom of these "digital drugs" set in plenty of people's heads. FOMO, fear of missing out. You NEED to do your dailies, you NEED to grind that battle pass because it's on a timer. You NEED to log in every day for your bonus. You're not doing any of this because it's fun, but because you NEED to, or your rewards will vanish.

[@MyH3ntaiGirl]

Bethesda game like TES and Fallout are flat out addictive I keep going back time and time again, mod or no mod

[@yanstein8464]

​@@bruhtholemewi got a vivid flashback to my time playing mobile gacha glad i got off the hook and don't return for this bullshit EVER

[@coolguy6398]

A great vid as always. Unlike many other company/industry focused youtubers you clearly understand business and business practices. Everyone is moving to agile development for software (even the government), which while nice, I don't know if its best for critical technology/software. You really don't want anything buggy when lives are at stake. A lot of software devs are being trained and focused into this sort of development style (which reminds me a lot of Just-In-Time practices although less reliant on a big network of businesses) and I think there is going to be a come-to-jesus moment when a critical software developed in this way fails or bugs out (sort of like how JIT has had issues with supply chains). This is especially true for military systems which are much harder to send updates to since many are not connected to any internet for security purposes (in fact many software developed in this way will send updates via CDs because it's just the easiest way to get the update from point A to point B) If I could invest in this channel, I would. I can't see this channel not taking off. It's analyzing these companies/industries at a much deeper level than pretty much anyone else. The only way I see this channel not taking off is if the creator goes off and does something else.

[@Maniacsurvivor]

Agile does not mean just in time. It is a much better software practise than waterfall, because it allows to get feedback during the development process. This video does not a good job in showing that. To push unfinished software is always a management decision. And by the way, over 20% of all waterfall projects fail completely. For agile it is only about 5%. It is just a much better way to manage a coding project. Also don't be concernt about safety-critical systems. Agile actually helps to improve those systems, because that allows rigorous testing, over and over again. Again, pushing unfinished software is a choice, probably a greedy one. And trust me; they always know.

[@buzz_is_here]

Agile is based on the idea of continuous development and delivery of WORKING software. That’s the whole point - rapidly release new features and fixes. Releasing buggy and lacking software is a poor management decision for short term profits using marketing hype. But we also need to understand that in the last 20 years, it’s become more expensive to develop games as you need to pay your expensive developers, artists etc, as well as your shareholders, who demand yearly growth.

[@ericolivier1271]

Great video as always! 3:35 got me thinking about Strava putting user created features like segments behind a paywall, essentially monetizing the community's work. That got me thinking, an interesting topic might be health and wellness for a future video, because god knows people are willing to fork over money hand over fist to get/stay fit

[@marcospenadev]

Still watching but gonna clarify something as a Software Developer: doing agile doesn't mean that you compromise software quality. Back en in waterfall there were 2 main problems: long and useless initial estimation that were always ditched to the trashcan at the first major problem. They were good to pitch to investors, not so much to actually deliver. The second problem of waterfall was the isolation of the development team with the client/product people. That would lead to devs having to rewrite and lose time/money because the delivered software was not what the client expected. In this case, the client could be the publisher. Under agile you should always iterate, plan, test and validate the piece of software you deliver. If there are good quality assurance practice in place, there shouldn't be a problem of buggy releases. To prove my point, almost all software industry uses agile nowadays, but only videogames have this increasingly concern of buggy/broken releases as a norm. It's not agile methodology the problem, it's the lack of control, testing or just giving a damn about the product by the developer, managers and publishers all at once.

[@michaeltorres1263]

As a software engineer, this has been a fantastic look into the development cycle and finances of software as a service in games (GaaS). I wonder if this creator is a software engineer himself? Either case, quality content.

[@XxSpartan617xX]

This is my new Favorite channel!!!!

[@Sturmwaffles]

My man, you are making some of the most unbelievably high quality content on KZbin. Well done from a future MBA to an incredibly talented current one!

[@Bullet.]

EXCELLENT content dude. So insightful - A great topic, expertly scripted and voiced. Your hard work really shows! Super glad I found this channel, and I can't wait to see what you make next!

[@SimonBuchanNz]

As a developer, hearing waterfall described as an approach that leads to good products and agile as leading to bad products was pretty hilarious.

[@Mr2ops]

What do you mean? Waterfall for a video game where all features should be known and put up up front is a great idea. This isn't like a website or production application where user's needs change during it's lifetime. I mean does Scrum or Agile for a video game really make sense? You could split the development into sprints and certainly make it feel like Agile but because things are and need to be known far ahead of time it won't actually be that different from waterfall.

[@nisnast]

@@Mr2ops Because game development is more volatile and you need to adapt on the fly to problems and changes. Deus Ex Human Revolution is a good example of this.

[@SimonBuchanNz]

@@Mr2ops "all features should be known [...] up front" bwah hah hah! You clearly haven't seen any actual game development commentary.

[@Xld3beats]

​@@SimonBuchanNz that's just development, AKA solving problems. There's a handful of things you want to balance, and risk all around it.

[@Mr2ops]

@@nisnast Right but the problems that occur aren't drastic enough to shorten development cycles to two weeks. They can be big, I know what kind of hell Team Fortress 2 was in for a while, but its not worthy of sprints and the agile way of thinking. Just a good project manager who can flexibly work with every problem because we never purely use one management method in any software industry truth be told. What I'm getting at though is that with video games the ideas are usually very concrete for long term thinking to be a better idea.

[@VideosIave]

Outstanding. We'll spoken. You'll be a massive channel man.

[@Miki19910723]

Please don't mix agile and saas, they are not really connected. Almost all game industry shifted as much as it could to agile quite long a go. You could also argue that fixed schedule and release on time no metter what is much more of a marketing and waterfall thing.

[@chrissyau4541]

Really love your videos! Informative and eye opening, basically binge watched all in one sitting. Please make more!

[@Peteruspl]

I'd expect there's extreme winner-take-all situation for these services. If two games are same type one will get more popular and take most players. Why play continuously the 2nd best modern team fps battle royale? Why not the best? There are different aesthetic and gameplay tastes so its not going to be just one game, but it will be big winner, a few who manage to survive and vast majority will fail. This is similar with normal showbusiness titles but its not less risky, its more risky. You don't need to convince player to pay $60 to play this new game for 2 months, but convince him to leave SaaS he already enjoys and commit to this new SaaS for next year or more, over which time he might pay $60-100 and in rare cases maybe hundreds of bucks if its a free spending whale. So I don't quite see how this lowers the risk aside from wishful thinking masquerading the risk away. "We can do it on the cheap and the finish after release" - how frequently does it work?

[@PatternShift]

A side effect of all the battles passes, seasons, micro transactions etc is that people who like to play multiplayer get heavily invested in one game, and if it’s not what their IRL friends are invested in, they end up never playing games together. Saw this happen with my old group of friends, we used to try out a bunch of games together, play multiplayer modes in rotation. Now I see many of the same friends all stuck entirely in one other game. So many of us ended up in the indie game scene instead. And those games are lovely. The only downside is that either there’s often no multiplayer, or we never play the same game at the same time (there are just too many). I think we’ve lost a lot of time well spent with our friends with the demise of casual AAA multiplayer.

[@mcst6969]

In Cyberpunk's downfall their Q&A team was hugely fault. Virtually they did not have one(only a few guy, because), they outsourced the games testing to a "scam" company! On YT you can find a very detailed 30+ min video about it. *in a nutshell: the mentioned company was a real and tested company, but when on smaller project when they accepted they Cyberpunk job, the experienced QA tester wanted a pay rise(rightfully), they quickly fired them, hired newcomers for beans and MANDATED a certain number of bugs every day/week(if I remember correctly), 100 new bug report/week/tester, so CD project received a Bug report in 1000's every week. Very minor bug like one block of the pavement is slightly different color on one street, or one button is glitched out on the main character's (optional aka you can buy from a vendor/store) jacket, etc, etc. So CD thought their are no game breaking Bugs at all in the game if they ONLY receiving such trivial level of Bug reports! (In retrospect they should known better, and do the QA testing in house as before!)

[@ggwp638BC]

Truth is, like in basically every industry, over and over again, the final turth is that it doesn't matter how much you change the business strategy, the ultimate business strategy, the do or die, is the same: deliver a good product, make money. Companies keep trying to jump into games as a service to try and avoid the risky nature of the business, but they forget to deliver good, new, experiences. Of course they will fail.

[@demilishing]

There was way more content in here than I was expecting going into it. Really enjoyed your yoy comparisons and how they changed based on games or service sales. As a gamer though I would never invest in a gaming company as it's really hard to create something memorable compared to the many peers. If Valve ever goes public though, I'm buying IPO as long as it's not unbelievably expensive. Steam is a cash cow and Lord Gaben milks that cow every day.

[@arnowisp6244]

I believe the fact they aren't public and beholden to Shareholders is exactly why they are successful.

[@demilishing]

@@arnowisp6244 I think it's the fact they don't need external funding as the marketplace makes them money 24/7 365.

[@arnowisp6244]

@@demilishing That too. Gramted with no shareholder telling them to raise revenue every quarter. They can sit by and enjoy the passive income that is steam Market place.

[@demilishing]

@@arnowisp6244 Yeah they can make long term decisions without the pain of constantly being told what to do by shareholders and having to do quarterly conference calls, filing regularly as well. They just do need the money or the pain that comes with it.

[@lolpl0000]

that was a pretty cool video. i usually dont watch these long, detailed breakdowns but this kept my interest throughout. :)

[@lolpl0000]

@JackSmith-mk1ru based

[@Tetragramz]

6:03 Yakuza is not a yearly installation.

[@matthewzz1997]

Great video. Really helped me understand some of these companies’ decisions.

[@THE16THPHANTOM]

i like that games die faster and before the developers even have a chance push out their first fixes. this new way of development does not seem to take into account that gamers are just going to abandon your game before your first SaaS update. should have listened to that guy who said a delayed game is eventually good but a rushed game is forever broken(something like that).

[@meleter8107]

If I recall, the quote is from Shigeru Miyamoto. A bit ironic now but still. If a SaaS game is to be successful, it needs to be considered 'finished' at launch, with updates being an expansion, adding content that keeps players coming back, rather than just patching holes that should have been closed during development.

[@michapiasta3072]

This quote was created before updating games was possible

[@meleter8107]

@@michapiasta3072 Arguably it is still partially true. If you have to spend less time on the foundation of the game due to time constraints, that will be hard to fix later.

[@eunaoseibrother467]

This quote was made during the N64 era and it doesnt make sense today where games take more than 5 years to be made.

[@Maric18]

the problem is not necessarily with agile, but with the reward structure for shipping shit i work in loosely agile based (always remember to fit methods to your team, not the other way around!) development and we only have a new version every so often, but at the end of every sprint we try to know what we did, and if a task didn't get done it gets deferred to the next sprint, and if it didn't get done again, we look at it as a team and figure out what went wrong. This is so much better than having someone spent half a year on an incredibly hard to implement feature that wasn't that needed in the first place. (there is a funny story floating around about a designer wanting full reflection on cars to make them feel faster, since you can't just make the cars faster)

[@Alex55455]

Software development methodology is not the problem. I have worked in IT for over 12 years now and have seen my fair share of projects releasing new software under both methodologies and can say it’s not the methodology followed that gives you incomplete buggy software. The real problem comes from management above who are pushing for a release date so the software is rushed to make a deadline with very little testing. A true agile approach would in fact be more flexible and easier to adapt to the changes of pushing dates out than waterfall should management actually allow the devs more time to actually make good games.

[@Nicolas-rz7uc]

One of the best channel on youtube

[@thequietloud]

I’m a software developer. Agile v waterfall has nothing to do with new video game SaaS models. While I work on an agile team, I have friends and peers at Bungie, Microsoft and Spotify who all have mixtures of hybrid Waterfall, Agile, Kanban, DevOps etc as team structures. Decent video, but again the software development methodology has nothing to do with game releases or evolutions.

[@moandawg]

Watched it all and was kept engaged even though I initially didnt have any interest in the topic. Well done!

[@DeadNoob451]

Fascinating insights. Refreshing to see someone take a more rational and analytical approach to this topic instead of "LOOTBOXES BAD AAAAAAAA" Also production quality that matches the big guys out there. Nice. It will be highly interesting to see how these modern SaaS companies in general will survive the upcoming economical meltdown. A squeezed consumer will demand better value or cheaper services, since almost all Services are superfluous spending compared to food, rent, utilities and gasoline. Somethings gotta give. My money is on outsourcing of any AAA software job that isnt nailed down (ie. all non unicorn employees) to lower cost-of-living regions, leaving only a skeleton crew behind to focus on more important work that would be inefficient to outsource. Actiblizz already did this with Lemon Sky Studios, and i would not be surprised if others follow. Nobody is gonna pay for hundreds of generic 3D artists etc. that need money to pay for downtown LA apartments when the easy money (both from VC and consumers) dries up. The average western AAA dev/artist is several times as expensive as others around the world. He sure aint several times more productive though. In fact id guess there will be absolutely no noticeable difference if the guy making your games gets payed a 3rd of what he used to because he is now (happily) living in Malaysia instead of California. Especially since the industry already works on a "good enough is good enough" standard that should be easy to match for really anyone out there. I wonder if the cities that currently live off of software companies will gradually turn into the next rust-belt as these employees are replaced with cheaper international ones, just as it happened with car company employees decades ago. If the "campuses" of the AAA industry turn into hollow shells of what they once were just as Detroits machine halls did. Also should really fancy up some of the bigger "2nd world" country cities i guess. Kinda like small-scale shanghais, each with a few outsourcing providers that develop and 3D model and do whatnot cheaper than the current AAA industry guys. Also, if you could do your job just as well if your computer sat in Bratislava, then you may wanna start downsizing and saving money before the digital AAA gravy train comes to its last stop in the west. Maybe start some side-project with a few guys from your job. Maybe consider preparing for a different job entirely. Maybe learn a second language and prepare to follow the coding jobs to places where you dont pay 2k for a tiny 1-bedroom apartment. If i had to guess when this happens, i would say it starts Q1-Q2 next year, when this holiday release season has underperformed because of the same consumer spending dent that causes Target trouble right now. Best of luck regardless.

[@luiso2166]

.... Loot boxes are bad and this whole SaaS model that video game companies are moving towards are a cancer.

[@DeadNoob451]

@@luiso2166 Yeah, i fully agree. But i dont think any more videos that contain the same complaints about this by now dead horse of a point are really adding anything to the discussion. Nobody likes this stuff because it sucks. Everybody uses it anyways. Companies keep making it. Repeat. Thats just kinda tiring after the 200th time ya know. Activision is not going to care even if its repeated for the 201st time. People will keep buying lootboxes and stupid subscriptions even if we repeat it a 202nd time that they are stupid. I dont know why anyone just accepts this stuff either. I just know people may say they hate it, but they then act like they love gambling mechanics and rental services as soon as the trailer for the next cod is uploaded. Why even waste time complaining anymore if nobody ever does anything about it?

[@Genashi1991]

I'm a year late, but this was some good stuff. I used to be a kid just playing games, didn't even stop to think who made what ect. now after playing for some 20 years, I find it curious to see how the industry works and how much money dictates things. It's important, of course, to keep in mind that just because a company made a good game doesn't mean the next one will be that way too.

[@Legalizeasbestos]

I think your explanation of Agile was a bit hectic. Basically Agile is a planning method where instead of lining up a bunch of steps and then sticking to a schedule to complete a product (traditional/waterfall) you instead focus on getting a working product into the customers hands as fast as possible. You then improve on this product over and over again which are called “iterations”. You eventually are supposed to have that same full product after all these iterations. I think you can see where this is going. Traditional/waterfall meant you got the whole game after they developed the entire thing following a length plan. Agile means they are pump out a game with the least amount of content possible while still being able to sell it. They then keep improving on it as they go. They then get to make a lot of money earlier and get to release stuff faster. This leads to “live service” games that release with nothing but sell just like old completed games. Plus you now get to act like your DLC (which is just cut content you give them later) is free because you love the gamer.

[@Solo2121]

This. I don't think the dev model is the issue at all. The "issue" is companies are finding that point where us gamers are ok to start buying in the dev cycle. With the huge scope most games have compared to early 2000s games it will take much longer to get to that "finished" state that they needed to get to with the waterfall model. So Agile just allows them the ability to pick the spot when they can start selling. It is us, the consumer, who gives them the data of when they can start selling and imo it is the early access/extended betas that make them believe they can sell unfinished games. The fact that ANY paid early access or extended beta game sells means we have the appetite to buy unfinished games. So, really it is the dev time (that really hasn't been increased to match to increase in scope - looking directly at all those sports franchises lol) and our acceptance of paying for official unfinished products that have lead us here. Escape from Tarkov and Star Citizen creators are set for life without ever having to actually launch. We consumers are silly if we think that isn't us sending a BIG message to the industry.

[@MrMuskadine]

Your channel is great, so many well researched and well thought out videos!

[@fiskern2241]

This is a big misunderstanding of waterfall vs agile process. Using agile does not at all mean that you are creating a SaaS game. Almost no one uses waterfall anymore, even single player offline games.

[@luks1207]

That's why I always play games 5 years after the lauch. I wait for the reviews, that show the game is full of bugs, I wait for some time, forget the game even exists, and about 3-5 years later, I remember that game, and buy it on sales.

[@DavidHosey1]

I don’t think putting Yakuza in the same category as FIFA is fair or right at all. Not only is Yakuza objectively high quality, but they don’t even come out with a sequel every year. The last two releases were 7 in 2019 and Lost Judgment in 2021, with us only getting a dlc for a game this year

[@Vernardo]

Not just Yakuza (now officially titled Like A Dragon), some other franchises may need longer time to ensure the game are playable without all those little hiccups.

[@AaronJLong]

Nice to see a take that looks at examples of these aspects being done well, and not so well. Before day-1 patches and season passes and such, when games were sold in physical stores or by mail order on floppies and CDs, there were still games breaking bugs in certain titles with nostalgic darling Daggerfall reportedly being unfinishable in its original unpatched retail release, with patches being distributed on floppies by retailers or mailed to customers. There were also level packs and expansions for popular games, including retail releases of amateur created maps and mods sold without the blessings of the creators of the base games or the creators of the content itself. Some expansions turned great games into timeless classics, while other were what we would consider low effort cash grab DLC, only in a physical box. These concepts may be more common, but they aren't new. Runescape has been running for over 20 years, and for most of that lifespan has had a free to play version with most new content and thus a majority of the game being locked behind a paid subscription. It has since forked into two different games, old school which is based on a 2007 backup of the game, and despite being updated regularly with new content tries to stick to the spirit of what the game was like back then, and RS3, the "main" but less popular version that is full of paid cosmetics, pay to win lootboxes, and all of that other icky more modern stuff. It is like examples of a good and a bad live service existing together, grown from the same seed, right beside each other.

[@ProducerX21]

Square Enix has lost all of its reputation in my eyes. The love I had for Square before the Enix merger was unrivaled by any video game company before or since. It is so sad to see what has happened

[@four-en-tee]

THATS THE THING THOUGH: GTAO and RDO are completely separate experiences from the campaign. Like, I have no issue with a developer wanting to do that since the multiplayer is completely optional for a lot of people. Most gamers bought those games for the single player campaigns during launch, and had the multiplayer modes failed over time, they would've at least still had a solid story-driven game on their hands. Thats just because Rockstar is fantastic at making single player stories.

[@srbtlevse16]

This model's biggest problem for consumers is that it rewards mediocrity

[@mtninjas]

Amazing video. Really well done. I can't tell if I'm just old or cheap because I see people complain about microtransactions but I have never purchased a DLC, season pass, or perks. I just pay for the game and that's it. I also always wait for reviews. Never would I purchase a buggy broken game.

[@bobbybrad5154]

If you're in the business of making creative products, you need to keep innovating.

[@soutengames]

That's a very well thought out video. Now I see why things are so broken at launch, and further strengthens me resolve to buy games a few months after launch when the patches have come in, the game is stable, and going for a steep discount. Too bad about story spoilers though

[@klobiforpresident2254]

Ah, agile development. Our bosses once tried to get us into it. Management might have forgotten we're a bank.

[@luisoncpp]

Agile doesn't mean publicly releasing broken games, is just a way to internally organize the teamwork, QA can test each release until the game is stable

[@DoubleThinkTwice]

It's easy, really. Do NOT pre-order. Do NOT buy the games within the first few weeks of launch. Let the hype settle. If the game was a good game at launch, it will still be a good game four weeks, months or years later. Do not give in to fomo, do not let your friends drive you into fomo. Enjoy your time playing, but be mindful of the money you spend. Also, I've been missing two topics in this video (and generally a lot of time when the topic of "live service" games are discussed: 1. Asset bloat. The most expensive part of game development is rarely the code these days, but the every-increasing fidelity of assets, be it textures, sounds, animations. There's an argument to be had that reducing fidelity would reduce costs, and still sell good numbers if the game is fun. 2. Indie games. A lot of indie games are still selling full games. They don't have the resources to delve neck-deep into asset bloat, and are the antithesis to AAA games. They reduce their scope to do a few things, but do a few things well (some don't, but that's just how it works). Some of the most fun I've had these past ten years was with games too small to appear in best-selling lists.

[@TodorSRB]

8:47 while I agree with most of what is said in this video, I don't think No Man's Sky deserves to be put in that with the others you mentioned, not because it bounced back and delivered on everything that was promised and more(AND FOR FREE), but because it doesn't compare with AAA studios, Hello Games is small studio, was even smaller when they worked on NMS and the problem and the reason why NMS was pushed out so early was because Sony was putting insane pressure on them to do so, there are multiple occasions where they mentioned they would've never released it in that state if it was up to them. I think nowdays being a publicly traded publisher/developer is just digging your own grave and forcing yourself into this SaaS rat race, because it revolves only around one thing, money. This is one of the major reasons I respect Valve, they didn't sell out like that. Yeah selling out is great for quick buck, but in the end you lose so much integrity you end up like Blizzard, EA, Ubisoft, etc.

[@JAN0L]

No mention of FFXIV for Square Enix? It seems to be saving their ass financially right now and it is a live service game.

[@johanneszwilling]

That was REALLY!! good! Imagine how much more appreciative and successful kids and teenagers would become if society would make sure that part of their consumptive, passive, restrictive and behaved upbringing would include these business realities and the opportunity to try their hand for anything that interests them!

[@tubz]

Software developer here. Waterfall vs Agile is NOT the reason why AAA games are bad today. It's a business decision to ship games early and buggy. You can still develop in an agile way and not ship a live service game. Honestly you not making this distinction makes me feel like you don't really know what you're talking about. Agile methodology and SaaS are not the same thing

[@Peytonwatson14]

Amazing video, just the right length, with recent events that I followed and even got a deeper understanding of. Very entertaining while being informative, I love seeing information about what went wrong with this business Vs What This Business Is Doing right. Me, Someone Who Can’t Stand loot boxes, or copy and paste games every year love the fact that take two takes time with their games and only release a select few every year. Quality > quantity, especially When you can maximize revenue/profit off of fewer games. Keep it up man, This content you Get from a channel With millions of views

[@trenvert123]

I feel like a lot of video game analysis videos are ultimately hurt by taking these corporations' words at face value. These conversations go in circles, because they just dance around the fact that the real issue is capitalism. SE said Tomb Raider underperformed, when it still sold millions of copies. They made money, just not as much as their investors and executives were hoping for. They then announced, they'd be moving to online video games, because those are more profitable while requiring less effort. They then said they would sell Tomb Raider, and get into NFTs. They are all charlatans.

[@freatythedreary5491]

This channel is gold, so glad I discovered it

[@keydemographics]

As someone who works in software support, it's hilarious listening to gamers talk about the SaaSification of games like it's something unique to the gaming industry. I really enjoyed this.

[@burrybondz225]

?? I think he made it clear that this is relevant for many industries and chose to talk about the gaming industry specifically

[@FlowerBoyWorld]

waterfall and agile are methods for managing and developing products such as software, they are not models for how you ship or monetize your product. it seems like they correspond to legacy vs saas but this is misguided and compeltely misses to point of agile development (which has been around much longer than saas was possible). you can develop a product completely in agile but ship it just once.

[@bjarkisteinnpetursson9736]

Live service is pretty much an automatic dealbreaker for me

[@DanAdeyoju]

James Steph Sterling will love this video

[@joelman1989]

This is why I wish we had more AA games that don’t have a massive budget they need to justify. This year I played Prey and Kenna Bridge if Spirits. Two games that I guess ls are indie but felt like AA games. And I really enjoyed them.

[@coltonwilson9638]

Phenomenal vid, subbing after that alone.

[@aronseptianto8142]

ngl it's a bit suprising how not profitable these game companies are I'm still not gonna buy their game, but still

[@CasualGamers]

The most bizarre thing of this video is to know that 2013 was a disastruous year for Square Enix, when arguably the 3 best games they ever made were released: Sleeping Dogs, Hitman Absolution and Tomb Raider 2013.