Food for thought after the Zynga debacle :-) Very good article from Dean Takahashi as usual :-)
(Reproduced from VentureBeat)
by Dean Takahashi
From the Supreme Court to Anonymous, 2011 was a transformational year for games
Skyrim was the "most played" game of the year, and we voted Uncharted 3: Drake's Deception our Game of the Year. But if you paid attention only to the big games this year, you may have missed some of the most important news ever to hit the game industry. It's no exaggeration to say that 2011 was a transformational year for the game industry. As the game industry's trade group chief, Michael Gallagher, said, “The word ‘historic’ is overused, but as we look back on 2011, it is a perfect fit for our industry’s year." Here's a recap of 13 events that made this such a big year for games.
1. Video game violence case. The U.S. Supreme Court put to rest a decades long legal debate over video game violence and whether game publishers' right to publish violent games without restrictions on who could buy them is protected by the First Amendment. The court struck down a California law as unconstitutional because it banned the sale of violent video games to minors. For the first time, the highest court in the country will give games the same legal protection that books, plays, and movies enjoy, because games “communicate ideas through familiar literary devices and features distinctive to the medium.” The court cited a previous case that held, “the basic principles of freedom of speech do not vary with a new and different communication medium.” With that, a long chapter of legal warfare will end and the video game industry will finally enjoy its own measure of creative freedom.
2. Zynga and Nexon went public. They each raised $1 billion or more in the biggest initial public offerings ever to happen in the 40-year history of the industry. The offerings were somewhat rocky, but after the dust settled, Nexon was worth around $7 billion and Zynga was worth more than $8 billion -- valuations that made them more valuable than Electronic Arts, which was founded in 1982. Nexon was the Asian company that pioneered the free-to-play, virtual goods business model, which, has proven an effective way for game makers to make money despite rampant piracy. That model made it OK to buy virtual goods in games in micro-transactions. Zynga took that model and ran with it on Facebook, growing at an incredible rate from nothing in 2007 to more than $1 billion in sales now. We wrote an in-depth story (now an eBook) about Zynga's journey to the IPO. The bears say that the Gold Rush of social gaming won't last. But with mobile gaming coming on fast, it's not so easy to bet against the upstarts of gaming. This story has just begun, and it will be interesting to see what Zynga will do with an extra billion dollars in cash.
(Reproduced from VentureBeat)
by Dean Takahashi
From the Supreme Court to Anonymous, 2011 was a transformational year for games
Skyrim was the "most played" game of the year, and we voted Uncharted 3: Drake's Deception our Game of the Year. But if you paid attention only to the big games this year, you may have missed some of the most important news ever to hit the game industry. It's no exaggeration to say that 2011 was a transformational year for the game industry. As the game industry's trade group chief, Michael Gallagher, said, “The word ‘historic’ is overused, but as we look back on 2011, it is a perfect fit for our industry’s year." Here's a recap of 13 events that made this such a big year for games.
1. Video game violence case. The U.S. Supreme Court put to rest a decades long legal debate over video game violence and whether game publishers' right to publish violent games without restrictions on who could buy them is protected by the First Amendment. The court struck down a California law as unconstitutional because it banned the sale of violent video games to minors. For the first time, the highest court in the country will give games the same legal protection that books, plays, and movies enjoy, because games “communicate ideas through familiar literary devices and features distinctive to the medium.” The court cited a previous case that held, “the basic principles of freedom of speech do not vary with a new and different communication medium.” With that, a long chapter of legal warfare will end and the video game industry will finally enjoy its own measure of creative freedom.
2. Zynga and Nexon went public. They each raised $1 billion or more in the biggest initial public offerings ever to happen in the 40-year history of the industry. The offerings were somewhat rocky, but after the dust settled, Nexon was worth around $7 billion and Zynga was worth more than $8 billion -- valuations that made them more valuable than Electronic Arts, which was founded in 1982. Nexon was the Asian company that pioneered the free-to-play, virtual goods business model, which, has proven an effective way for game makers to make money despite rampant piracy. That model made it OK to buy virtual goods in games in micro-transactions. Zynga took that model and ran with it on Facebook, growing at an incredible rate from nothing in 2007 to more than $1 billion in sales now. We wrote an in-depth story (now an eBook) about Zynga's journey to the IPO. The bears say that the Gold Rush of social gaming won't last. But with mobile gaming coming on fast, it's not so easy to bet against the upstarts of gaming. This story has just begun, and it will be interesting to see what Zynga will do with an extra billion dollars in cash.
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