This Week in Games: July 7, 2012

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I was hoping to be able to embed this week's episode of Quoted for Truth, as I usually do, in this week's This Week in Games, but unfortunately we ran into some technical difficulties. We actually recorded a full 40-minute show ready for distribution this weekend, and I have to say it was magnificent. We were insightful, witty, and unusually charming. Even Tom McShea. Unfortunately all of that awesomeness condensed into one episode caused some kind of recording malfunction, and the sound was completely messed up. I could post it here, but it would just be a 40-minute video of Brendan, Tom, and I being handsome with an awful noise blasting over the top of it. I guess it could make for some creatively dubbed videos. We fully intended to try to re-create the magnificence, but the studio wasn't available. So here we are. Quoted for Truth-less. Sorry about that.

By way of compensation, please check out the new news-quiz-themed GameSpot podcast that we released earlier this week, featuring Kevin VanOrd, Chris Watters, Shaun McInnis, Tom McShea, and yours truly. It's a bit different from the Hotspot, which it is replacing, but I hope you like it. You can play it right here in the player embedded below, or you can use this RSS feed to receive new episodes of the show each Wednesday.

Anyway…enough of all that. On to this week's big stories.

That Sony and Gaikai Rumor Finally Came True

Remember that rumor? The one about Sony buying a cloud gaming service that we thought would be announced at E3? One like Gaikai? Yeah? Well, possibly the biggest news of the week came last Sunday when Sony announced that it had acquired Gaikai. According to a statement, the publisher intends to use the acquisition to establish a new cloud service combining Gaikai's resources with its own. "By combining Gaikai's technological strength and engineering talent with SCE's extensive game platform knowledge and experience, SCE will provide users with unparalleled cloud entertainment experiences," president and group CEO of Sony Computer Entertainment Andrew House said in a wordy, buzzword-stuffed statement. "SCE will deliver a world-class cloud-streaming service that allows users to instantly enjoy a broad array of content ranging from immersive core games with rich graphics to casual content anytime, anywhere on a variety of Internet-connected devices."

Established in 2008 in Aliso Viejo, California, by David Perry (you may know him as the founder of Shiny Entertainment, among many other projects), Gaikai enables game streaming to a variety of devices, such as tablets, connected-TVs, phones, or your computer through a high-speed Internet connection. Because it's cloud-based, there's no need for much local processing power; all that's needed is a fast enough connection and the ability to process the HD video stream. The platform allows players to demo and purchase games such as Call of Duty or Mass Effect 3 through a browser-based interface built on common technologies like Java and Flash. "We're honored to be able to help SCE rapidly harness the power of the interactive cloud and to continue to grow their ecosystem, to empower developers with new capabilities, to dramatically improve the reach of exciting content and to bring breathtaking new experiences to users worldwide," Perry said.

If Sony does announce a new PS3 model at the German industry event, it will not be the first time the company has done so.

This, however, does not mean the PlayStation house is giving up on retail with future hardware. Speaking to European trade publication MCV, Sony Computer Entertainment UK boss Fergal Gara acknowledged the retail business has declined of late, but said this is a "re-adjustment" period, rather than a total disintegration. "We'd love to see as many of those retailers as possible maintain their interest in servicing the space because clearly down the road many of us are going to be doing our best to give another injection into the market whenever the next cycle starts," he said.

So, knowing this, what do you think the PlayStation 4 will be? Is the future of the platform as a service, rather than a box? Do you even think there will be a PlayStation 4 now? Especially given the fact that a new PlayStation 3 model appears to be waiting in the wings. According to a Federal Communications Commission filing (spotted by Japanese website Pocket News), Sony is preparing a new 4000-series PS3 model, an update over the current 3000 line. The filing does not mention dimensions, but Eurogamer "has heard" that Sony is preparing to announce a slimmer PS3 model at Gamescom 2012 next month. If Sony does announce a new PS3 model at the German industry event, it will not be the first time the company has done so.

Borderlands 2 on the Vita With Cross-Play? Yes Please

Sticking with PlayStation-themed news from this week, it seems that Gearbox CEO Randy Pitchford is eager for an outside company to create a PlayStation Vita version of his upcoming shooter Borderlands 2. Speaking at PC and indie game event Rezzed on Friday (attended by Eurogamer), Pitchford explained that he is excited about the potential for cross-platform play with the PlayStation 3 version. "One of the things I wish Sony would do is get behind Borderlands, because I'd love to see a Vita version of the game," he said. "I want to be able to have the character I'm working on with my PS3, and then when I'm on the road with my Vita I can just keep developing that same character because it exists on the cloud somewhere."

Pitchford explained that Gearbox itself is "too busy" to create Borderlands 2 for the PS Vita, but he said the company is willing to have an outside studio work on it. "I know there are a lot of talented developers who could take our code, our source, and our content and perhaps create something like that," he said. "That would be exciting to me."

Would it be exciting to you? We're certainly into the idea.

Wii U Online to Be Free

Nintendo is not planning to charge a subscription fee for the Wii U's online service, company president Satoru Iwata said during a recent shareholders meeting, the English translation of which can be found here. Iwata explained that the decision to make the Nintendo Network (which also operates on the 3DS) free to access was due in part to an effort to accommodate gamers' play habits. "We have a wide variety of consumers, from the ones who enthusiastically play video games to those playing more casually, who are not always interested in them but try to play a game only when it has become a public topic or play it just during certain periods, like a year-end season and summer vacation," he said. "We therefore believe that services which ask our consumers to obtain paid memberships are not always the best."

Microsoft's Phil Spencer Makes a Dig at Wii U

As you know, Nintendo will be the first of the Big Three to release next-generation hardware, but according to Microsoft's Phil Spencer the Wii U is only on par with current-generation consoles, like the Xbox 360. "I think their Pro Controller makes a lot of sense with the platform they've built," he said. They are building a platform that is effectively a 360 when you think of graphical capability." He went on to explain, "Now they are really making an on-ramp for the back catalog of games that are on 360. It is easy for those games to move over to the Wii U. They've moved the buttons around, and they've made a controller that feels familiar for 360 gamers, so I get why they are putting those pieces together," he said. This is not the first time it has been suggested that the Wii U will lag behind future consoles from Microsoft and Sony. Last month, Sony Worldwide Studios boss Shuhei Yoshida said the Wii U was in a generation of its own. And before that, a GameSpot survey found that the next Xbox and PlayStation 4 already have a leg up on the Wii U.

EA's Future Is Digital

Electronic Arts is mapping out a path that will see it transition eventually to a 100 percent digital business, EA Games president Frank Gibeau told Games Industry International in an interview published this week. "It's in the near future. It's coming," he said. "We have a clear line of sight on it and we're excited about it. Retail is a great channel for us. We have great relationships with our partners there. At the same time, the ultimate relationship is the connection that we have with the gamer. If the gamer wants to get the game through a digital download and that's the best way for them to get it, that's what we're going to do. It has a lot of enhancements for our business. It allows us to keep more that we make. It allows us to do some really interesting things from a service level standpoint; we can be a lot more personalized with what we're doing."

"But if customers want to buy a game at retail, they can do that too. We'll continue to deliver games in whatever media formats make sense and as one ebbs and one starts to flow, we'll go in that direction," Gibeau said. "For us, the fastest growing segment of our business is clearly digital and clearly digital services and ultimately Electronic Arts, at some point in the future…we're going to be a 100 percent digital company, period. It's going to be there some day. It's inevitable."

"For us, the fastest growing segment of our business is clearly digital and clearly digital services and ultimately Electronic Arts, at some point in the future…we're going to be a 100 percent digital company, period. It's going to be there some day. It's inevitable." - Frank Gibeau, Electronic Arts

In May, EA revealed that its digital business was booming. This particular sector of the publisher's business brought in $1.2 billion for the year between its downloadable games, subscription fees, add-on content, and mobile and social platforms. Additionally, EA said its digital business will grow over the next 12 months. "In the coming year, we break away from the pack, with a very different profile than the traditional game companies and capabilities that none of our new digital competitors can match," EA CEO John Riccitiello said. Elsewhere in the interview, Gibeau spat some harsh words at industry research firm the NPD Group. He said a big problem with the industry today is that it is viewed by people like an "elephant through a straw." This view, he says, leaves out important distribution channels like Facebook, mobile, and free-to-play games. "An occasional bad report from NPD, which measures a sliver of what's actually happening in gaming, gives people an erroneous impression," he said. "My point is it's an irrelevant measure on the industry. It's totally irrelevant. We don't even really look at it internally anymore. We're more focused on our services and how we're connected with consumers. The number of Nucleus accounts we're growing, the amount of engagement time that we have, the amount of services that we're running--those are more important metrics for us than unit sales according to NPD and North America."

Following the publication of this story, NPD Games president David McQuillan issued a statement to GameSpot regarding Gibeau's comments. He admitted digital is a significant component of the industry, and said he was "surprised" to hear what Gibeau had to say. "While digital is a growing part of the industry and something that needs to be addressed for the future, the current games industry is still largely rooted in retail and any industry player involved with AAA content simply can’t take their eye away from the retail environment," McQuillan said. "Successful companies are looking at how their products are performing within all channels, particularly retail."

"For that reason, we were surprised to read the comments by Mr. Gibeau that EA does not look at NPD data internally at all. While we will not comment on the specifics on our long-standing relationship with EA, we can say with confidence that we have daily dealings with all of our major publisher clients. And we know for a fact they’re using the data. According to our latest estimates, new physical software represented 56 percent of the consumer spend on games content in the US in 2011, and 70 percent in Q4, specifically. If a publisher that produced AAA content were in a position where they could not access NPD data to analyze, review, and benchmark against competition and the rest of the market, we would think they would be challenged to effectively manage an important part of their current business and their relationship with the retail community."

Keep Your Eye on Tencent: First League of Legends, Now Call of Duty

Activision and Chinese Internet service provider Tencent announced earlier this week that Call of Duty Online, a new PC free-to-play first-person shooter is set for release in mainland China. According to Activision, the game will be based on Infinity Ward's Call of Duty: Modern Warfare universe, and has been in development for almost two years. As part of the multiyear agreement, Tencent will have the exclusive license to operate Call of Duty: Online in China. The free-to-play game will be monetized through the sale of in-game items like weapons, gear, and perks "built specifically for the Chinese market." As for the game itself, Call of Duty: Online features an original story told through a string of special operations missions based on Call of Duty: Modern Warfare. Tencent, which acquired a majority stake in League of Legends publisher Riot Games last year, and recently acquired a minority stake in Gears of War studio Epic Games, believes Call of Duty: Online has the potential to attract "tens of millions" of gamers, according to president Martin Lau. There's no word yet on a release outside of China, but it seems safe to assume that it's going to happen. Keep your eye on Tencent…they're going to become a more important name in the whole gaming space.

Don't Forget, This Weekend Is EVO!

Fighting game fan? You'll want to check out our coverage of the biggest fighting game event of the year, which is taking place this weekend: EVO 2012. Check it out right here.

Next Week Is Comic-Con Week

A bunch of us are heading down to San Diego for Comic-Con next week, so keep your eye on this page for updates on our coverage from the event. We'll have live programming on Thursday, Friday, and Saturday, plus coverage from the show floor, from panels, and game demos. Make sure you're following us on Twitter for up-to-the-minute updates on what we're up to.

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