Raph Koster to game biz: evolve or die

Former SOE CCO says dinosaurs still roam in the industry--and there's an extinction-level event on the way for those who can't adapt.

AUSTIN, Texas--For his session at the Austin Game Conference, Raph Koster used dinosaurs (and their eventual extinction) as a metaphor for today's game industry. He warned that a shakeout is coming, and it will select only those who evolve to suit the changing market.

Right off the bat, the former chief creative officer of Sony Online Entertainment noted that he wasn't suggesting that evolution and adaptation are inherently positive. He used his own business-casual wardrobe as an example that drew laughs from the crowd.

Raph Koster, Dinosaur Hunter.

"These days I wear shirts with buttons on them," Koster said. "That may or may not be progress depending on your point of view. It isn't really from my point of view. It takes a lot longer to get dressed in the mornings and I can no longer obtain my wardrobe for free from conferences like this one. But it does permit me to move in slightly different circles and signals different things."

Getting into the meat of his presentation, Koster ran down the way the industry works today, in what he called the "pre-comet" ecology. He touched on funding issues and the role of the publisher in game creation. He also singled out sparse reuse of game content to benefit developers and lamented how a studio working on a game gets relatively few opportunities to move into other media.

The end result, according to Koster, is the current hit-driven state of the game industry, which focus on the top 20 percent of games. "The particular adaptation that we've made to this is to not bother making or stocking or selling the other 80 percent," Koster said. "So when you walk into your friendly neighborhood GameStop, you won't find the game that is 21 on the charts. Because of limited shelf space, they just don't want it around. It's just not worth having it compared to game number 20 twice, or better yet, The Sims and all of its expansions."

That has made publishers focus on creating blockbuster AAA titles from the get-go, Koster said, and the cost of developing games has been increasing exponentially in recent years as a result. According to Koster's figures, budgets have gone up by a factor of 22 in the last dozen years, with development teams creating 40 to 150 times as much content for a single game.

"The next spot on this graph eats the entire industry in one gulp," Koster warned. "It's not sustainable."

To adapt to the market, Koster said the industry has evolved a number of specialized adaptations, including 3D graphics cards, surround sound for desktop PCs, high-resolution graphics, single-player games, and heavy-narrative games.

"Those kinds of extremely specialized adaptations are the things that turn into vulnerabilities if the circumstances change," Koster said. "And it's fairly easy to run down this list and see where they turn into vulnerabilities on burgeoning platforms today. Look at all of these [in relation to] cell phones. I guess the single-player works. The rest of it? Not so good."

And while the industry has been celebrating a broadening cultural awareness of games, Koster doesn't think it's been due to gaming reaching out to the masses with its appeal. Instead, he suggested that it's more a case of broader culture cherry-picking what it wants from games.

"Our signature moments are things like The Drew Carey show reaching in, pulling out The Sims and putting it on a TV show, things like some psycho kid reaching in, grabbing [Grand Theft Auto], and turning it into a court case," Koster said. "Those are our signature pop-culture moments right now. The high-grade achievements of gaming are not the ones that are going out to the mass market, I'm sad to say."

On top of that, other media are sniping aspects of the game industry and throwing them into their own products. Television series like American Idol, Survivor, Lost, and Star Trek 2.0--a new interactive version of the original sci-fi show--all incorporate elements from gaming.

"We now have television shows with Easter eggs," Koster said. "In fact, they're putting Easter eggs in the commercials. Our best tricks are getting stolen."

Another group that Koster said will force change on the industry is the array of content aggregators, the vendors who offer the 80 percent of content that can't be found easily at retail. He noted the appeal of diversity for downloadable services like iTunes or Netflix that pride themselves on a huge catalog of offerings. Even if Netflix's sole copy of the 1987 comedy Amazon Women on the Moon gets rented once a month, Koster said, it's still worth it to have it offered to the few who want it.

"You want to be putting together as much stuff [as possible]--even if it is crap, even if the graphics suck, even if the interface is terrible--because somebody will download it, and disc space is nearly free," he asserted.

Koster predicted a shakeout for publishers who aren't able to adapt in time, but he sees some big players taking steps in the right direction. Specifically, he praised console manufacturers' advances, including Xbox Live Arcade, the Wii controller, and Sony and Nintendo's plans to sell older games through their upcoming systems.

"People are getting the picture," Koster said. "It's a question of how quickly it'll change. In this environment, digital distribution is the only logical play."

Wrapping up his prehistoric metaphor with a prediction of the future, Koster told the audience to envision a world without game retailers or publishers, just aggregators and portals. While that will enable independent developers and smaller titles to be distributed more widely than they are today, it will not necessarily result in an abundance of noise in the channel. To combat that, Koster suggests developers take a page from other media and cultivate their own celebrity.

"The only way that you will stick your head above the noise is to have a following. Your team, or you personally, or your brand, is going to have to be something that inspires loyalty to stick up above the noise," Koster said. "That's the only way to get through."

119 Comments

  • TomNationwide

    Posted Sep 13, 2006 5:04 pm PT

    Raph did, in fact, destroy the SWG MMO. What he attempted to do is create a Sims/EQ game with Star Wars Skins and an open world environment. This is NOT what the crowds wanted. What the crowds wanted was a game that made you feel like farmboy Luke growing into Jedi Luke, or Smuggler Han growing into Rebel General Han, or Princess Leia becoming a leader of the Rebellion. He entirely failed to deliver the Star Wars Experience to the masses.

    HOWEVER... He DID succeed in making the single greatest MMO that had ever been created in both complexitya nd ambition. The only shameful part is it came with a Star Wars title. Had it not, we would all still be playing it today. SECOND... As for his comments they are troubling. He appears to be losing touch with the audience. What we see isn't Drew Carey or Court Case, what we see is our Genre being SUCCESSFULLY translated to the Big Screen, being made into successful toy lines, to successful comics, even to Mainstream TV Shows. I must say now is a great time to be a gaming fan as there will be a revolution coming, but it will not be what Raph expects.

  • Gall0ws

    Posted Sep 10, 2006 8:43 pm PT

    I'm not sure at all that the entire industry will change, but you have to see what he is saying. Look at games just 10 years ago. In the mid-to-late 90s, there were dozens of games out all the time that nobody had ever heard of. How many Breach 3's were there for every X-Com? How many Red Barons for every Wing Commander? How Many Cyber Storms for every Steel Panther game?

    Back then you could just walk into any game store --hell even Walmart-- and see games that you had never even heard of. Now we know of every game release nearly a full year before it comes out. The simple reason there are so few games that are so hyped now, is because developers simply can't afford to make a game that will fail and lose money.

    But Digital Distribution solves that. No, it will not be the "norm", and you will certainly be able to buy hard copies of all the large-name games that come out. But Digital Distribution will allow the little game companies to release their own products, and make money doing it. I would put Space Empires IV up against any modern space 4x game. How many people worked on that one? How much money did that development cost? The fact is, the little guys often make alot better games than the big publishers. Once those little games start to become mainstream and easily available, the big publishers will be hurting.

  • cikame

    Posted Sep 10, 2006 9:00 am PT

    where did they get this guy?

  • iebubu

    Posted Sep 9, 2006 8:15 pm PT

    We will see how things work out. I personally prefer having a buying a physical disk over downloading. I mean I’ve re-installed windows like twice, and each time I had to download HL2 all over again. I just think it's too time consuming. I know that high speed internet will get faster than it is now (I have cable by the way), but so will the size of the games. I mean I don’t want to have to wait 5 hours for a game to finish downloading.

  • mattxavier

    Posted Sep 9, 2006 7:16 pm PT

    I've said it once and I will say it again, what will kil the gaming industry is the ridiculous price tags they slap on games.

  • PyscoJuggalo

    Posted Sep 9, 2006 7:13 pm PT

    Dammed Luddites....

    "I will never DL a counsel game! That would give Developers a platform to fix bugs they released to market with patches and would reduce the cost of distributing games!"

    But Luddites aside, I agree with Koster. The industry has waaaay too much cost in making these games. They need to be more cost efficient and they need more indie developers. Indie developers will increase the size of the market, something mainstream developers really can't do.

    Koster may be controversial, but he does make good points about the industry.

  • rusty_duck

    Posted Sep 9, 2006 2:38 pm PT

    i'll never buy console games for d/l. i want the disk or i will find another hobby.

  • Humorguy_basic

    Posted Sep 9, 2006 11:06 am PT

    Don't forget everyone who's saying about the 'crappy games' bit, that anyone in the game industry or media that talks about the 'crappy games' means any game that did not cost $30 million to produce, was not published by one of the top ten 'labels' and would sell less than a million units. To the industry, (excuse my choices, but I am PC gamer) 'The Longest Journey' was crap. 'Uplink' was crap, the Infocom text adventures were crap, Space Rangers 2 was crap, and on and on.

    Why can't the media be more broad? Like supporting inde publishers and niche products? Why is every niche that cannot sell a million units seen as dead? Any publisher that spends a little less on development and marketing to sell a smaller number to that niche is laughed out of town?

    Why has the media not changed in 20 years? Why do we not have 3 reviewers giving their opinion on a game to give a more rounded view? Why not re-review the game 6 months after release to look at it after all the hype has died down, or the bugs have been fixed with patches? Why is a review score set in concrete?

    If a small publisher brought out a text adventure that had a superb parser, story and characters, it would be destroyed because it was a text adventure.It would be marked down in reviews so that anyone seeing a review would say 'won't touch that'. If they just reviewed it as an interactive novel and not based on the technology and therefore spoke about that superb parser and great story and that led to some gamers too young to know Infocom to give it a try, how does that hurt? And yet the media is so tied up with the big publishers that that would never happen.

    And so the likelihood of genres coming back and innovation becoming acceptable again is very unlikely. And that's why the market will just continue to shrink. Whatever piece of hardware you prefer.

  • NECR0CHILD313

    Posted Sep 9, 2006 7:51 am PT

    I'd rather buy a game in the store. I think you can order games that aren't selling well at Walmart.com.

  • FighterHayabusa

    Posted Sep 9, 2006 1:25 am PT

    Ok , ONE: the dude needs a shave. He looks like an Ewok.

    Two: SWG was actually pretty good for the first year and a half. It started to suck after the combat Upgrade and NGE. One was due to net nerds complaining on message boards, two was just desperation in WOW's wake. Both of those game-destroying changes were done after Koster Left SWG, so I dont see how you can blame him for that. Plus it took 200 people to make SWG, I cant see how you can blame him for why it does or doesn't suck. Not only that but he has as much right to speak as tools like Trip Hawkins (failed 3do) and Dave Perry (who's Shiny hasnt made a good game since Earthworm Jim).

  • standcm12

    Posted Sep 8, 2006 10:06 pm PT

    wow. i had to read that whole thing just to figure out he was talking about digital distribution. yep, it's pretty much common sense that digital distribution is great, and its coming soon. whoops dee freekin do. you wrote an article about it, your not special

  • morororo

    Posted Sep 8, 2006 4:04 pm PT

    "You want to be putting together as much stuff [as possible]--even if it is crap, even if the graphics suck, even if the interface is terrible--because somebody will download it, and disc space is nearly free," he asserted.

    Is he talking about the 500 crappy Everquest expansions?

  • markshell

    Posted Sep 8, 2006 2:50 pm PT

    So the one who has a following will survive? Hmm who might that be...

  • s0l0123

    Posted Sep 8, 2006 2:21 pm PT

    100% agreed with shasam712. Digital Distribution isn't the future.

  • hammerchad

    Posted Sep 8, 2006 1:23 pm PT

    GameGooN73, You typed the words right out of my fingers. Way to put things in the right perspective.

  • Merl57

    Posted Sep 8, 2006 12:45 pm PT

    Yeah I think loyalty goes a huge way when it comes to game sales.

  • Hoppe_c80

    Posted Sep 8, 2006 12:34 pm PT

    i have to agree with him

  • Phaltran

    Posted Sep 8, 2006 11:06 am PT

    When I met Raph during his time at Origin working on UO, I thought "This guy is a genius and will do alot for the gaming industry."The more I read about his ideas on his website and speeches like this, I'm now changing my initial impression.

    Raph does keep a good pulse on the industry, but I don't think he is contributing nor is he being considered an expert any longer. I think the time is near that he will simply fade into the background unless he does something major very soon.

    Yes, he was a pioneer with UO, but he tried to implement some concepts that just didn't fly because he underestimated the players: PvP, economy, ecology. He seemed to only consider the optimistic "nice" players that follow the rules, play the game as it was designed and get along well with other players. I just don't think he got out much growing up since he has a naivete about human interaction.

    It stands out much more (as many have demonstrated here) that UO and SWG show up as failures on his history. They both accomplished a great deal for the genre, but overall they're disappointments and on the brink of complete failure.

    Raph seems to be a great concept guy; maybe someone will hire him for just that. I think it's time for him to walk the walk and prove many of his ideas.

  • GKBeetle

    Posted Sep 8, 2006 10:32 am PT

    This guy makes no sense. First he says, "You want to be putting together as much stuff [as possible]--even if it is crap, even if the graphics suck, even if the interface is terrible--because somebody will download it, and disc space is nearly free." Then he says, "The only way that you will stick your head above the noise is to have a following. Your team, or you personally, or your brand, is going to have to be something that inspires loyalty to stick up above the noise." So, is he saying that the way to get yourself a following is to put out crap with bad graphics and a terrible interface?

  • esk1m00k

    Posted Sep 8, 2006 10:13 am PT

    I predict that everythings going to change in 15-20 years,i base this on the fact everything changed in the last 15-20 years.
    If i were a cynical man it would be easy to say those dinosaurs he talks about are SOEs mmo's...But really,what a non-article...

  • GameGooN73

    Posted Sep 8, 2006 9:12 am PT

    Yeah, everyone, let's listen to the guy that took a STAR WARS FRANCHISE and still managed to make it the most craptacular MMORPG in history. I mean do you know how BAD you have to suck, to make internet MMO nerds NOT want to play a SW based MMORPG????

    So I guess apparently Ralphie defines evolution as turning into a steaming pile of crap! Let's hope the industry perks up their ears before it's too late!!!! Oh noes!

  • Hellisunreal

    Posted Sep 8, 2006 4:35 am PT

    hmmm..... interesting...... as far qas the future who knows

  • wwonka666

    Posted Sep 8, 2006 4:22 am PT

    The only way to survive is to create gameplay that is fun on all levels. Not just catering to one type of gamer. Evolving A.I. when one player is not as good as another so that the game can continue to be fun for that person, it's interactive but not everyone is a hardcore gamer who can compete on the hardest of difficulty settings. But I do think he is dumb saying that on-line gaming is the way of the future. Single player gaming is the only thing that is going to keep the masses playing games. Not everyone has the skills and time necessary to only play games on-line. Nintendo creating the controller of the future is evolving gameplay like no other. The DS is flying of shelves because it is very easy to pick up and play. Long live Nintendo. Show your support for innovation don't buy Call of Duty 3, or Madden 07 or Tony Hawk 8, we should be getting yearly updates for a minimal cost. That is the way to breed innovation and keep gamers gaming.

  • corlorde

    Posted Sep 8, 2006 4:14 am PT

    RE: thepyrethatburn

    Great post, and good points.

  • thepyrethatburn

    Posted Sep 8, 2006 3:32 am PT

    Um... the people who talk about losing hard drive memory and loosing games obviously haven't used an online service before. Things like Valve's STEAM are just fantastic.



    I have used STEAM (Sin Episodes) and another service. The problem with that is that your game is then dependent on these services staying in business. As an example, I can still play my old Intellivision games. In 15-20 years, will people be able to play their STEAM games? What happens when Valve goes under? What becomes of the games that you've bought? What if Valve decides to go the Microsoft route and institutes a product life cycle system where, a certain number of years down the road, they no longer support the game and they don't carry it on their servers?



    Without the ability to back up your games, ALL of the ones you download are on borrowed time. However, with a physical copy, as long as the medium used doesn't degrade (such as floppies did), you have a game that you can enjoy years down the road.



    As for what the speaker was saying, I do think the industry is heading toward a correction and that digital distribution will factor into it but I don't think his conclusiongs are wholly merited.

  • chikahiro94

    Posted Sep 8, 2006 2:33 am PT

    @Jenslove2
    One could argue one learns more from failure than success (and what was unsuccessful about UO? You trying doing something that ambitious in an nacient genre). And he's talking about the business aspect, not necessarily the design.

    If you think there are too many "Me too" games out there (how many WWII shooters do we really need?) or too many sequels, then why bash him? If you believe that gameplay has taken the backseat to graphics (ie, you're playing a game that is only marginally improved than last generation, but looks prettier), and think it'll only get worse this generation, where's the disagreement? If you wonder why there aren't more different, if not experimental games, or why old favorite genres have gone away, and wonder how they could become available to you, why not listen?

    He touched on points I've been hearing a lot of in the past year or two - he's not saying anything new, but he's not necessarily saying anything wrong, either. Insulting him is easy, immature, and useless; challenging or elaborating on his comments would be far better.

    @theclaw135
    MvC2 for $10? That's cheap - if you've got copies see if you can sell'em on SRK or something - that's still a tournament game

  • theclaw135

    Posted Sep 8, 2006 1:28 am PT

    It is very annoying to into a store, and they never stock releases from smaller publishers. Does SNK get shelf space around here? No! I'd gotten lucky to just find one NIS title. Forget digital distribution. I haven't bought anything that way, all the demos I've downloaded sucked too much for me to bother. My steam install only contains the free stuff they offer with the HL2 Collector's Edition package I was given.

    So yeah. This industry does need to get away from it's focus on big budget software. If price is your concern, visit a few pawn shops. They often have quite affordable games. The rare on any platform Marvel vs. Capcom 2 at $10 for example. It'd be great if every game, big or small had equal respect from retailers.

  • Jenslove2

    Posted Sep 8, 2006 1:19 am PT

    When was the last time this Dinosaur made a successfull game?

    Oh, thats right, he never has.

    Seriously, I remember back in the SWG Days, my friends and I would have at least one "Stupid Holo Quote" every day.

    If Mr. Koster wants to be taken seriously, he needs to stop writing books and giving speeches on game design, and actually, you know, design something.

  • cypher50

    Posted Sep 7, 2006 11:42 pm PT

    Not a bad speech...he is basically saying what has been said time & time again in this industry: the current sales model of only focusing on licenses & blockbuster titles while ignoring new IPs and smaller successes cannot continue or else the industry will go through a crash similiar to 1984 and some companies won't survive.

  • eiru

    Posted Sep 7, 2006 11:41 pm PT

    blahhhhhhh

  • Master-Mykol

    Posted Sep 7, 2006 11:11 pm PT

    Too bad his facial hair doesnt cover his entire face

  • mikethemonkey

    Posted Sep 7, 2006 11:11 pm PT

    Some good points made here. I hope they don't pay this guy much for this Bull***?!
    ________________________________________________________ In every industry there must be change and a sense of moving forward to appeal to the masses.
    THE END P.S. You can quote me on that

  • axes03

    Posted Sep 7, 2006 11:00 pm PT

    [This message was deleted at the request of the original poster]

  • wildcatxzx

    Posted Sep 7, 2006 10:18 pm PT

    "n64nut:
    I refuse to take anyone from SOE seriously.

    If you've played SWG, then you know why. "

    Yeah, I know exactly what you mean - lol. Though this guy was around for the beginning and the CU periods of SWG, so it kinda makes you think he wasn't on board with the whole NGE garbage. lol

  • jared81799

    Posted Sep 7, 2006 10:13 pm PT

    axes03....did u even read the article? you know what? im not even going to make fun of your stupidity. when this man talks about the video game world everyone should listen. his visions have brought alot to the current genre's.

  • Rusty2004

    Posted Sep 7, 2006 10:11 pm PT

    "zintarr
    He looks like a pediphile. "

    LoLL ^_^

    Its pedophile BTW


    Rusty_1

  • mega_egg

    Posted Sep 7, 2006 10:05 pm PT

    zzzzz

  • zintarr

    Posted Sep 7, 2006 9:46 pm PT

    He looks like a pediphile.

  • knofou

    Posted Sep 7, 2006 9:41 pm PT

    Raph Koster with his work in Ultima Online, he was lead designer, helped create the mmorpg genre.

  • bminns

    Posted Sep 7, 2006 9:04 pm PT

    who is this guy?

  • FoxHoundADAM

    Posted Sep 7, 2006 8:57 pm PT

    People should pay me to speak at these events, I'd say a lot more with a lot less.

  • supercrap1

    Posted Sep 7, 2006 8:48 pm PT

    When they release E.T. for the PS3, at a budget of $58 million, then we'll know it's all over. Bring back arcades!

  • chikahiro94

    Posted Sep 7, 2006 8:44 pm PT

    I agree. The more we can get away from retail the better smaller/indy companies will do, and the less strict console developers have to be (why won't Sony let SNK release anything 2d without making it into a compilation here in the US? They let Sammy!). We might even see old, now niche genres come back because downloading games made it financially viable again.

  • CyphenX

    Posted Sep 7, 2006 8:33 pm PT

    Considering that this guy was associated with S.O.E. (even if it was just for five minutes) why are we listening to anything he says?

  • trusteft

    Posted Sep 7, 2006 8:30 pm PT

    It has been a while. Since I read something so long and at the same time so meaningless. The guy basicaly says nothing. Out of curiosity, have his "ideas" been the reason he doesn't work anymore at his last position, or have anything to do with his next job? Sounds more like promoting a future product (or place...) than anything more.

    But then again, I am no expert, I am just a gamer.

  • jonajacket

    Posted Sep 7, 2006 8:04 pm PT

    Humorguy_basic

    Agree with you totally mate, independants were the way to go! I buy all my stuff online nowadays, I hate going into chain-game stores with a shoddy selection and staff who 99% of the time know nothing about games.

    But still I'm persoanlly against downloading games, I'm a collector, it may be sad, but it's nice to watch your colection of games grow steadily over time. Even better when you've been a gamer for many years and have several generations of stuff or your a niche collector (love my Jp shooters on PS2 and Saturn and Neo!)

  • greks224

    Posted Sep 7, 2006 7:01 pm PT

    Um... the people who talk about losing hard drive memory and loosing games obviously haven't used an online service before. Things like Valve's STEAM are just fantastic. You can install your game on any machine you want and download it to that machine and play it... as long as you give them the username/password combination you registered your game under. Other systems (good systems at least) will do the same. You will have ownership of that game, and proof of that ownership is with a username and password. If you want to download the game again, then you should! And to prevent piracy, you can let only console/computer be logged into the system at a time. So it would be equivalent of lettting your friend borrow your game if you do decide to give him/her your username and password.

  • axes03

    Posted Sep 7, 2006 6:45 pm PT

    every single time these sony suits talk they just dig their grave a little deeper.....its like a curse from all the people they lied and fooled in their lifetime through the ps1,ps2 and SPECIALLY the psp (remodel?!! thats nintendo's job, how about some games) man i miss sega, may be someday theyll be back.........sigh, until then microsoft for me.

  • sootybuttercup2

    Posted Sep 7, 2006 6:20 pm PT

    If single player games dissapeared I would most likely quit gaming since the majority of my games are single player games. I don't enjoy online play very much and my friends can't always be around so I need a good single player to buy a game.

  • nappan

    Posted Sep 7, 2006 6:19 pm PT

    Thrilling... except that out of all the trends he mentions the only one he addresses is digital distribution, and uh, STEAM... I think he's forgetting that people WANT high end graphics narrative, and huge games (San Andreas anyone?). Digital distribution might let games like Psychonauts get the recognition they deserve, but it won't shorten dev times or make em cheaper. Ok, so maybe a company like Valve takes the 8 years to make a game as amazing as HL2... but how many games are WORTH that wait? Finally, there are three gaping holes in his argument. The first, is that games are getting bigger, but the bandwidth available to consumers to download multigigabyte games and store them is NOT growing at the same rate. Second: Hardware on the 5-10 year horizon promises things like flexible roll-up screens (OLEDS) and glasses that beam the image into the eye, or onto the glass surface for TRUE 3d, with Deapth of Field. So much for cellphone screens.

    Third: At some point graphics become photorealistic. When that happens this period of software racing ahead of hardware ends, and the era of $600 blockbuster video card releases ends. I see this guy as a software and business minded person approaching a VERY global issue from a narrow perspective.

    By the way, how do MOST people get followings in this day and age? Money. So, instead of shelfspace its massive advertising? I still see a role for big money backers (read: publicists.)

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