One of the over-riding impressions of the Conference is the massive change going on in the business of games. Some 90% of industry revenue currently comes from the sale of packaged product: consoles and licensed- or first- party titles for them. The remaining 10% represents everything else: PC titles, mobile games, SNS (Social Network Software, aka Facebook) games, subscription MMO’s, Free-to-Play MMO’s and the rest.
But this is changing fast.
The traditional consoles are, at best, not growing in sales and are likely contracting. Gordon Walton mentioned it in his Localization Summit Keynote (“It’s no secret …”). In the world market, the major growth regions of China and India are awash in pirated package product, giving little incentive to develop (and localize) such products for these markets.
All of the growth in the industry is coming from mobile apps, SNS games and Free-to-Play MMO’s. Even though revenue from these titles is small, the tremendous growth that they are seeing means that almost all new business investment and most of the best minds in the industry are gravitating there. Peter Vesterbacka, creator of Angry Birds, said at the South by Southwest Interactive Conference that console gaming is “Dead”.
Phil Harrison, a former Sony Computer Entertainment President, was even more blunt at GDC. “If this conference was called ‘Game Publishers Conference,’ I think everyone would be in the bar crying into their beer and being just miserable.”
It’s not hard to see why this shift is happening. In the West, game players (along with everyone else) are suffering through the Great Recession. In the East, most particularly in China and India, the console paradigm never established itself for reasons of piracy and cost, with most players having far less disposable income than their counterparts in the West. Hence, fewer and fewer people are paying $60 for a disk to load into a $500 console to entertain themselves. Taking out a cellphone you already own and playing Angry Birds ($0.99) seems much more sensible.
This means an enormous change for the business. The new growth players are much smaller, face a far more competitive marketplace, and yield revenue far less than others once received by selling disks for $50 to $70 each. See Trip Hawkins’ (founder of EA, now with Digital Chocolate) tirade on the subject here.
Now for the $100,000 question: What does this mean for Localization?
Until now, most localization in the games field has been contracted by a few large publishers (THQ, TakeTwo, Sony, etc.) to agencies (Babel, Apogee, Binari, etc.). These agencies then farm out the individual pieces of their projects to translators, as well as providing voice-over recordings, project management and consulting.
This worked fine with the console paradigm. It does not work in the new world, where margins are smaller and most publishers are not large, well-funded public companies. Now every cost is analyzed, so it is far more practical, even necessary — essential — for publishers large and small to hire translators directly. And this is where the growth of our industry lies now.
Most of the new games are simple and text- or image-based. There is no voice-over. The role of translation is simply that, translation of text with a round of proofing provided in linguistic test. There is no room for a middleman in this low margin environment.
For most of us in the industry, this means a sea change is in the making.
Apogee has already made its place in the new world. We’ve announced our intention to re-organize as a non-profit corporation and operate as a Translators’ Advocate. We’ve started the Apogee Certified Translators program which allows publishers — small and large alike — to hire translators directly, by knowing at a glance who they can trust to handle their titles. In our first move, we released all of our best translators in 15 languages and are now encouraging them to communicate directly with end clients. Every quarter starting on April 15, we will be releasing a new list of high quality translators. Apogee is offering ala carte services to replace those of a fully featured game localization agency, including translator sourcing, management and back office bookkeeping.
It’s not a question whether the new world is better or worse than the old; things change, and we all need to change with them. There are no more buggy whip manufacturers in our world. Old business models are dying constantly: book stores, video rental outlets, and the like.
And there are good aspects to this. By using translators directly, cost per word drops dramatically. It suddenly becomes feasible to release games in 30, 40 or 50 languages. Vast parts of the world that have never before seen well localized game products will now get them delivered on their cellphones … and soon to their tablets.
Its our role and our duty as leaders of this industry to change with the times, and make things better than they ever were before!