Talk to any cinephile in 2021 and you’ll hear concern over the future of major film studios committing to any features that aren’t surefire cash cows, especially under the shadow of COVID-19.
While the video game space has flourished during the pandemic, the recent disastrous launch of “Cyberpunk 2077” is a reminder that despite decades-long positive reception to vast open-world games prioritizing the single-player experience, making the video game equivalent of blockbusters comes with significant risks.
In the meantime, live-service games only ever seem to present as safer bets for companies to utilize or center themselves around entirely.
Overlong Development Cycles Are Unsustainable Without Other Streams of Revenue
“Cyberpunk” was worked on for five years before releasing December 10 in a barely functional state on PlayStation 4 and Xbox One consoles, which led to Microsoft refunding players and Sony doing the same while outright removing the digital version of the game from its storefront.
This has soured what should have been a celebratory moment for the game’s Polish developer and publisher, CD Projekt. “Cyberpunk” has sold more than 13 million copies since its release, but the company’s stock as of January 11 is down nearly 40% from where it was the day before launch. Plus, the game has seen a dramatic dropoff of players on PC, where it typically runs better than it does on consoles.
“The Last of Us Part II” was another major 2020 release with high expectations, developed over a similarly lengthy time frame. But unlike “Cyberpunk,” the game released in June to critical acclaim, which included praise for how its performance and graphics held up.
Whereas CD Projekt is still flying solo as its own publicly traded company, “The Last of Us” demonstrates how advantageous it is to make these games under a parent company, which in this case was Sony Interactive Entertainment. Deriving income from its hardware business and online storefront, SIE affords its studios substantial time to release games in a functional state.
Likewise, another moderately big publisher known for sticking to single-player, often open-world games is Bethesda Softworks. As of September 2020, Betheseda is now a Microsoft subsidiary, after its parent company ZeniMax was acquired for a whopping $7.5 billion.
Much was made of what the acquisition meant for Xbox as a brand, but the implications for Bethesda were vast as well, since the company is known and often teased for releasing its games in buggy states. It now has an enormous flow of cash backing its studios.
Live-Service Models Extend Revenues Post-Release, Allowing for Faster Growth
Most game makers do not have the back-end funds of a Sony or Microsoft, so it’s no wonder developers and publishers would much rather prioritize live-service games in their pipeline.
Live-service games often follow a model by which the game receives regular updates post-launch, often on a weekly basis, creating lucrative revenue streams for publishers via the purchase of in-game content (colloquially known as microtransactions).
Given how quickly Epic Games turned “Fortnite” into a multibillion-dollar platform thanks to in-game purchases and constant updates, it’s understandable that companies are going all in on what’s come to be a tried-and-true model for revenue streams with extensive legs.
French publisher Ubisoft doubled down on this notion at the start of 2018, asserting revenue from live-service titles like competitive shooters “Rainbow Six Siege” and “The Division” slowed the losses of revenue for games after their first years.
Meanwhile, smaller companies with successful live-service titles are increasingly taking cues from companies like Epic and branching out on their own.
In 2019, Bungie acquired the rights to its live-service shooter franchise “Destiny” from mega-publisher Activision, announcing plans to convert itself into a full-on content house off the back of its successful IP.
Then there’s IO Interactive, which has taken over distribution for the third iteration of its rebooted “Hitman” series, whose assassination missions fit the contours of live service via weekly challenges and events. The formula there is working well enough that even before the release of “Hitman 3” later this month, the company has been given the opportunity to develop “Project 007,” a new James Bond game.
But the incentive to develop games as live services isn’t just about boosting revenue; it’s also about creating second chances.
Regular Updates Can Help Games Bounce Back From Weak Launches
Regular updates to games, in terms of both new content and bug fixes, can eventually mend disappointing launches, which is far more difficult to do for one-and-done single–player games. The launch of Ubisoft’s “Rainbow Six Siege” was besieged with complaints over a lack of sufficient play options and poor performance, but within two years of its 2015 release it had amassed 25 million players after substantial updates were rolled out over time.
Electronic Arts is hoping for a similar recovery for ill-received 2019 release “Anthem” and is working to extend its life for years to come, while another flop by way of Bethesda’s “Fallout 76” has since made a comeback, following the company’s attempt to branch out from its traditional single-player approach to games.
“Cyberpunk” isn’t being cast by the wayside just yet, as CD Projekt is busy working to fix the game for PS4 and Xbox One while readying versions of the game for PS5 and Xbox Series X, where the game will be expected to operate much better than it has upon initial release.
But with so many companies big and small pivoting to a live-service preference, it won’t be surprising if CD Projekt rethinks its current approach to games, or even takes a cue from Ubisoft and tries to reformat “Cyberpunk” around a model similar to what it has done with the later “Assassin’s Creed” games.
Otherwise, the relaunch of the game for new consoles may see the years of hard work on it go to waste, as CD Projekt’s futuristic actioner fails to align with the actual future of the industry at large.