IEMA Update: CNN/Money's Chris Morris eyes the game industry's future

HUNTINGTON BEACH, Calif.--A necessary read for any game-industry professional is Chris Morris' Game Over column on the CNN/Money Web site. When Game Over goes live, readers are guaranteed of learning something new, and of tapping into a story that can't be found elsewhere.

Morris is in attendance at the Interactive Entertainment Merchants Association Executive Summit in Orange County today, where he'll moderate a panel that brings together a number of well-respected game industry analysts (including Mike Wallace of UBS Investment Research and Heath Terry of CSFB).

We spoke to Morris shortly before the event kicked off.

GameSpot: What do you see as the three most significant hot-button issues facing game retailers today as they approach a new generation of game machines?

Chris Morris: The growing trend toward legislation is certainly the biggest issue retailers are facing. Lawmakers want to dictate where games can be placed on shelves and hold retail clerks legally accountable for checking IDs (when, for instance, people who sell movie tickets are not). The legal fees spent fighting these bills are going to be enormous, I suspect. Digital distribution may very well start to have an impact as we move later into the cycle. That will probably affect PC game sales more than consoles, but some of the plans Sony and Microsoft have discussed, such as episodic content, might begin moving consumers away from traditional retail outlets. Pricing will probably be a short-term hot-button issue as well. If prices for AAA games do make the jump to $60, there's going to be a reeducation process that has to take place. While I suspect people will still buy the games, they're not going to be happy about the dramatic price increase...and they're going to be vocal about that.

GS: In what ways do you see the upcoming 360, Revolution, and PS3 battlefield differing from previous hardware launches?

CM: This cycle seems different to me in that all three publishers are looking well beyond their core audience. Previous hardware launches have been specifically tailored to gamers. This time around, Sony, Microsoft, and Nintendo all seem to be trying to reach a broader audience. It's an interesting move. The industry has certainly grown by leaps and bounds with the latest generation, but I'm not sure if soccer moms are really looking forward to next-gen machines at this point. This is also one of the first launches I can remember where the hardware manufacturers are referring to each other by name. In the past, it has been like a political campaign, where phrases like "my opponent" and "the competition" were used, but other companies were never directly identified. This time, everyone is very specific about who they're planning to beat and what they perceive that company's shortcomings to be.

GS: They are talking tougher. Why is that so?

CM: It's a high-stakes financial game now, so the gloves have definitely come off. Truth be told, those gloves came off much earlier in this generation...probably about the time Microsoft got involved. Sony and Nintendo recognized they were facing a potentially strong competitor with an enormous bankroll, so they weren't afraid to be more direct. In time, that spread industry-wide.

GS: Can you take us inside the news room at CNN? Does senior editorial staff view the game sector any differently today than they have in previous years?

CM: Well, I work for CNN/Money, so I can only really take you inside that specific portion of the newsroom. Attitudes almost certainly vary among the editors and producers in the various parts of the network. I lobbied for more than a year for a column about the gaming industry here to little avail. It was only when a story I wrote about the launch of the Xbox recorded off-the-chart traffic that my then-editor agreed to start the column..."on a trial basis." That was late 2001. Today, my editors are extremely supportive of what I do, both with the column, with news stories, and attending industry events. So in my own little corner of CNN, yes, the beat has definitely taken on a greater significance.

GS: Of course, many in the industry look to your column as one that often breaks news, but can you tell us a little bit of your inside game? Where do you go for news?

CM: Oh sure, I tell you, you tell others, and next thing I know I'm back to covering insurance stories. No, in all seriousness, I simply employ the same basic skills I've used for any sort of reporting in my career. I talk with a lot of people. I read a lot of documents. And I listen to the answers to my questions to see if I pick up a hint of something else. A lot of the time it's just luck. I've been very fortunate.

GS: Who do you think are the five most powerful people in the game industry today? In order, if you care.

CM: Wow. That's a tough one, since it's so hard to segregate the executive side from the developer side, in terms of raw power. I'll take a stab at it, but I'll refrain from putting them in any sort of order: Ken Kutaragi, Larry Probst, the buyer for Wal-Mart, Mark Rein, Doug Lowenstein. (My apologies to Sam Houser and Will Wright, both of whom were on the list several times as I struggled over it. They're currently locked in a deathmatch struggle for sixth.)

GS: Which companies matter most to the game industry? For example, Microsoft and its maturing devotion to the game space, and Sony's ongoing push to reinvent gaming. Those are just two easy examples. Now, what about yours?

CM: I think you have to include Nintendo in that list as well. It continues to dominate the handheld space and serves a younger market the other companies virtually ignore. You couldn't have the graphical advances we've seen without Nvidia and ATI. I'm reticent to include any publishers in the list, though, since it's ultimately the developers who make the games. Were "Publisher X" not around, that doesn't mean the industry would never have seen "Hit Game Y." It would have come from somewhere else.

GS: Do you see the early launch of the 360 (relative to the PS3) as providing a significant long-term advantage to Microsoft?

CM: Not really. It's certainly better than starting a year late as they did this generation, but there are some people who are going to wait for the PS3 no matter what. And Sony had the advantage of being able to show glossy tech demos at this year's E3, versus the pre-alpha games Microsoft was showing for the 360. Even when the final products launch later this year, gamers will still be mentally comparing them to the PS3's tech demos, which could impact sales. It's really going to come down to how the buzz is about the 360's launch window lineup. Will Perfect Dark Zero or Gears of War attract a following as big as or bigger than Halo? Will having a Madden game boost initial sales? That's what's going to help move units.

GS: What trends stood out at this year's E3 for you?

CM: Sequels and licenses and gangs, oh my! If I see one more World War II-themed game, I'm going to scream. Ditto with the glut of gang-warfare/GTA clones. And while several publishers have done good jobs with movie or other licenses, I really miss the days when game companies were the ones coming up with original ideas. I know about the economic realities--the cost of development, the impact of a high-profile failure, the importance of spreading the cost around--but I still cheered like crazy last year when I saw Katamari Damacy for the first time. I cheered again when I saw Spore this year.

GS: Any "aha" moments you recall at this year's E3?

CM: Again, Spore. It's still early in development, but what Will Wright is creating is a truly awe-inspiring game. I can't wait to play it start to finish, though I don't envy whoever has to come up with the marketing line for it at EA. Also, it seems to be almost clone-proof. While the industry tends to feed on itself, trying to re-create whatever the hit game of the moment happens to be (witness the aforementioned glut of GTA clones), I don't see how anyone is going to be able to duplicate Spore.

GS: Has the game beat become more or less interesting for you since starting your Game Over column?

CM: Oh, definitely more interesting. The exponential growth of the industry in the past few years has been exciting to track...and we're headed into a period that promises more of the same. The games have gotten better. The industry has gotten, in some ways, more mature, which has been fascinating to observe. Games have now been around long enough to actually have a retro trend, which has brought back people who haven't played for years. There are thousands of questions about what's next and how the industry is going to get there. And I look forward to seeing the answers evolve.

GS: Thanks, Chris.