What the GameSpot Debacle Means for Tech

lolgerstmann.jpgLast week, after 10-plus years with CNET’s GameSpot, the Internet’s top game coverage site, editorial director Jeff Gerstmann was summarily fired under mysterious circumstances. The subsequent outrage is still roiling the Net, so in the end, it doesn’t really matter if (as the theory goes) he was defenestrated for rudely panning Kane & Lynch: Dead Men, a high-profile game from top GameSpot advertiser Eidos Interactive (CNET steadfastly denies this was the case).

In light of the ongoing fury of gamers who have already assumed the worst, he might as well have been. More relevant is how the controversy will help restructure the industry, vastly accelerating three trends already at hand:

Established Game Sites Must Consolidate or Die

Utterly dependent on game publishers for their ad revenue, fanboy-oriented sites like GameSpot and GameSpy have been playing both sides of the editorial/advertising wall for years. In 2006, I reported how those sites allow publishers to purchase more editorial prominence for their titles; Newsweek game correspondent N’Gai Croal notes this week how they also sell metrics to game retailers that track readers’ editorial interests.

Industry insiders have long known about questionable practices like these — and now, thanks to Gerstmann’s firing, so do gamers, who will likely abandon them en masse. To restore their credibility, these sites need to consolidate with larger editorial entities that don’t depend on game advertising.

Then again, it may be too late for them, because game blogs like Kotaku and Joystiq, for example, are already partnered with diversified advertising networks, and unsurprisingly, have been providing punchy coverage of the Gerstmann affair. With more freedom to be provocatively opinionated, game blogs and fansites like Penny Arcade (which broke the Gerstmann story) are gaining the reader trust (and page views) prominent sites like GameSpot have squandered, becoming far more central to the industry. This leads us to the next big shift:

The Death of Hardcore Games (Mostly)

The game industry has long invested in hit-driven, hardcore games like Kane & Lynch — titles that mainly appeal to the 18-34 male “power gamer” demographic that enjoys violent action and epic gameplay — regardless of how unappealing they are to pretty much anyone else. (Kayne & Lynch’s’ eponymous “heroes” are actually death row escapee cop killers — hence Gerstmann’s derisive comment that it is an “an ugly, ugly game”.)

Trouble is, power gamers are a fraction of a vastly larger market (just six million of some 55 million households in the U.S., according to Parks Associates). And because hardcore games take tens of millions of dollars to produce, they cost upwards of $60 at retail. Consequently, game reviews are hugely, disproportionately influential to a game’s sales — far more than movie reviews on box office receipts, as New York Times’ Seth Schiesel notes. For that reason, reviewers like Gerstmann can help make or break a hardcore game.

Now that such a prominent figure as Gertsmann has been removed, and for what many believe are dubious reasons, this essential chain in the promotion cycle is broken. Why? Because from this point forward, gamers will doubt the word of any reviewer on a site heavy with publisher ads, and reviewers will begin self-censoring, fearful of being too forthright and potentially suffering Gerstmann’s fate. Publishers will no longer be able to rely on the implicit pressure of their advertising dollars for good reviews, so they’ll have to earn a profit the old-fashioned way: by making good games. But that’s an inherently risky enterprise, especially when your potential audience is so small. Established indie game studios like Valve (which has its own distribution network) will keep pumping out hardcore titles, but publishers will defray their risks by largely getting out of the sub-genre, preferring lower budget titles with broader appeal. Which leads to the next trend:

Platform Chaos: 360 and PS3 Plummet; Wii, PS2, Casual Gaming Conquer

The biggest losers in all this are the 360 and PS3, indelibly branded as the main platforms for hardcore gamers. Console publishers were already shifting away from them in favor of the Wii and PS2, the former because it’s expected to gain a huge install base, the latter because it already has one. This adjustment will continue, especially for casual games on all platforms, including the PC. (Who needs reviewers when you can decide whether you like a game after 10 minutes of play?) A post-Gerstmann industry will cater to the 360/PS3 gamer even less (for reasons stated above), and when they do, will try to sell them titles aimed at a broader audience.

To be sure, some editorial damage control may delay these moves, but as I’ve argued before, these larger trends are irreversible from a market perspective; the game industry as we’ve understood it for the last two decades is careening toward drastic changes. In the end, Jeff Gerstmann is just one more unfortunate guy that got tossed out the window before impact. [digg=http://digg.com/gaming_news/What_the_Gamespot_Gerstmann_debacle_means_for_gaming]

Image credit: Gamespot. LOLGerstmann embellishment by WJA.