It’s a question I’ve been asked quite a lot recently, and in general it’s code for ‘will things ever go back to the way they were before?’
The answer is no. Game development as it was 2000-2009 is done. In the past. Those days will not return. That doesn’t mean we won’t see large studios (50-100 people) in Australia again. We most certainly will, out of a combination of growth and local success (Half Brick) and international purchase and investment (3 Blokes / Rock You).
The simple fact of the matter is that the industry has changed, and in the way of all businesses it’s gone through a period of innovation followed by a period of consolidation. Big team console development has consolidated out of Australia, and because the rapid growth part of the cycle has already happened, the circumstances aren’t right to bring it back. As long as AAA console development remains stable (and not in a period of explosive year on year growth, like mobile/social) we won’t see it return to our shores. The period where new studios could get into AAA development has passed us by.
Games industry growth is driven by market growth – and the traditional console market isn’t growing. In fact, while we’re seeing total revenues for individual titles getting bigger each year, the overall sales across the top 20 titles are down. Again, that’s a sign of consolidation. Studios grew organically during the years of growth, and then merged or were sold during the initial wave of consolidation.
So, we will see growth in areas where the market is still fragmented and yet to consolidate (mobile, social, digital download) and we won’t see growth in the areas where the market is stagnant and consolidated. Therefore, no “AAA development as we used to know it,” returning to Australia.
On the other hand, that doesn’t in any way negate future disruptions, like the next wave of consoles having an app store enabling Steam style success for indies on console platforms, resetting the market for growth again.
There are a host of opportunities locally. Focusing on whether things will every be like they used to be again blinds us to the opportunities the future holds.
People often tell me how much they think a game costs to make. Generally speaking, they’re out by an order of magnitude, so here’s a small post to give you the secret game developers use when sorting out a budget.
The quick answer is ($$$ = T x M x 10k) or Cost ($$$) = Time (T) times (Man Months) x $10k (the usual fully loaded cost per man month).
This number is derived from the standard industry costings, which come out to $10k per man month fully loaded. What does fully loaded mean? It means that the number includes everything involved in paying for the person – wages, software, rent, depreciation on desks, margin, etc. Anytime people in the industry need to work out a back of the envelope budget calculation, 10k per man month is the figure they use.
The upside of this is that it makes it extremely simple to calculate game budgets (at least ballpark). Some teams cost more (I’ve heard that the general fully loaded rate of an internal Microsoft employee approaches $20k) and some cost less (I’ve heard Sony will fund PSN games at $6.5k per man month, but no higher without internal review) but nonetheless it works out nicely as a rule of thumb.
The next step is to work out how long the game took to develop – which can be the tricky part. Often the first you hear about a game is when it announces – and it may well have been in development for years before then. Sometimes you’ll hear people in interviews outline how long development was, and you should be able to work out rough dates from digging around online. Once you’ve spent long enough in the industry you can generally eyeball a project and get a sense of how long it’s been in development for.
Once you have a total development time, you need to work out how many people are on the project. The easiest way to do this is via the credits (on MobyGames generally) – where credits exist. Otherwise you have to (again) do a bit more investigation. When you’re looking at credits, you want to focus on actual developers – not the publishers, voice actors, third party tool developers, etc.
With this in hand, you’ll have a rough number that represents development costs. It won’t be exact, but it’ll be in right ballpark and certainly enough to help you call bullshit when someone on the internet says “GTA4 only cost $10 million to make!” or “Angry Birds cost over $900k!” – you’ll be able to tell pretty quickly when people are way out of line.
By the way, this is also incredibly useful for transmedia people who would like to know how much it would cost to produce a game concept. Is your game just like Zelda64? From Moby Games we can see that there were 64 people working on it – first screen shots showed up in 1995 (and game was complete in 1998) so we’ll say 36 months development (quite probably a bit before that, but we’ll call it there). That means 36 x 64 x 10 = 23 Million – an astronomical number for the time (although that’s in todays money, not 1998 when the man month rate would have been lower – $17 million approx corrected for inflation).
Now, there are a bunch of ways in which these numbers are wrong. It doesn’t take publisher costs and marketing into account (which can range from a 20-100% increase in costs) and it also doesn’t account for the fact that teams generally run much smaller at the start than they do at the end. If you wanted to improve your figures, you could cost each 1/4 of development differently – assume the first is 25% loaded, the second 50%, the third 75% and the last 100% to account for the fact that every game has a finishing push. In other words, you can change the formula to ($$$ = T x M x 10k x 0.625) – but that gets fiddly and starts to get away from the elegance of a quick, fast, dirty way to calculate game expenses.
Edit : It’s been brought to my attention that current rates tend more towards $12.5k for 3rd party developers and $15-20k for publisher owned developers. Adjust your calculations accordingly!
Why AIMIA doesn’t represent Australian Interactive developers.
On the 18th of March I emailed AIMIA directly to let them know I was pretty unimpressed with their representation of the interactive industry (most notably games, and us developers who sit in the middle of the games/interactive space). The (slightly edited) email is below :
From my perspective (as ex-Lead Designer at Pandemic Aus, currently director of Defiant Development, and one of the more active cross platform game developers in Australia) AIMIA is entirely irrelevant to game developers in Australia. I say this as someone who’s active in working across film, tv, and advertising in the games space and a regular speaker on transmedia and serious games (or gamification, if we have to call it that).
I’m sure this situation comes about because you don’t have many/any game specialists involved as AIMIA members – looking at the awards (and the events you run) I can’t say I’m surprised. Games is the hub, the beating heart and soul of ‘interactive media’. When it comes to interactivity, the games people are head and shoulders ahead of the rest of the biz – as evidenced by the sudden desire to ‘gamify’. We’ve been ‘gamifying’ for decades, and represent the core of the expertise in creating engaging, addictive, enthralling, interactive content. We are the future of interactive media – and if you run your eye down the list of awards, you’d have to draw the conclusion that AIMIA is stuck well in the past.
To look specifically at your awards – award categories such as “Best Mobile Product or Service” “Best Cross Platform” “Best Use of Social Media” are all shamefully lacking in representing the (very relevant) work of Australian game/interactive developers in those categories. I’d offer feedback through your survey, but of course you don’t have a survey for people who didn’t attend, so there’s no way for me to engage. Besides which, your survey questions are all about the venue, host, transport and afterparty – not the award categories or nominations. It would seem that you either don’t realise how incredibly out of step you are with the interactive industry, or simply don’t care. At least not as much as you care about the canapés.
Your upcoming gamification event (the only thing I could find anywhere in the AIMIA site that looks even slightly games related) is another example of this reluctance to actually engage with game developers. Only 3rd Sense (who are an agency that makes games rather than strictly a games developer) are represented. You wouldn’t know from looking that Australia has some of the worlds leading projects in every platform – from flash and mobile developers through to $30 million console games, Australian games are recognised around the world. Of course, they’re not even registered by what (by name and description) should be our peak industry body locally.
In short, the situation is shameful. I deeply hope that there are moves to do something about this long term – either by engaging with the broader interactive community you claim to represent, or via a name change to something that makes less claims to represent all the interactive media professionals of Australia.
Been a while between posts here, and it’s nice to be able to talk about the reasons in depth! Over at Defiant Development (the studio I’ve founded with a group of ex-Pandemic types) we’ve got Rocket Bunnies out for Android.
In addition to that, there’s lots of other stuff going on – exciting times!
Two events have recently placed Team Bondi into the local game development news. First, it was recently announced (although not by them) that they were delaying their long awaited LA Noire into 2011, second an anonymous insider started airing dirty laundry on Twitter. The combination has the Australia development community once again discussing Team Bondi, and in general the prognosis isn’t good. I, on the other hand, am pretty sure that LA Noire will be at least a mild success, and at best a redefining game for the Oz industry. I seem to be pretty much alone amongst the wider development community on this front (especially if you read the primarily anonymous comments on Tsumea) so I thought it might be worthwhile explaining why I think so.
Overtime and overbudget is actually a positive sign :
LA Noire is a hugely ambitious open world game of the type very few people in the Oz industry have worked on. Hugely ambitious open world games share some common characteristics – they’re always late, they’re always over budget, and the entire team always crunches like mad throughout. Every GTA from 3 onwards has been late and over budget (in fact, it’s fair to say that’s true of almost every Rockstar game full stop), the same is true of projects I’ve been personally closer to (like Mercenaries 2, The Saboteur or the cancelled Batman game).
I can definitively say that no-one has yet shipped a large open world game easily on their first outing. Direct sequels (that don’t move to a new platform or reinvent the genre) are easier, but still not easy. In general, I don’t think people in the broad game community understand the additional complexity of building open world games with emergent and supporting systems over building classic linear games. Fans have close to no idea, and even developers are prone to massively underestimate the challenge.
Still, there is at least one company that understands this exceptionally well. They’ve built multiple massively successful open world games and continue to define the benchmark of what an open world game can achieve. That company is Rockstar, and they’re not only the open world experts, they’re very canny businessmen and marketers. Dan Houser is one of the most switched on producers I’ve ever met, which means if Rockstar are betting on Team Bondi I’m inclined to support that bet, evidence otherwise notwithstanding.
The thing about going over budget is that it’s actually a statement of support of the project – in order to get more money, you need to convince people that it’s worthwhile to continue. In this case, Team Bondi seem to have the support of Rockstar – a company that understands that one of the biggest obstacles to greatness in open world games is releasing too early. That has to be seen as a good sign, not a portent of disaster.
Crunch time and overwork :
Long, sustained crunch isn’t my thing. I’m not a fan of it for my studio or any teams I’ve ever led. In the long term I believe it loses more productivity than it gains. I’ve never shipped a 90+ open world game, though. The fact of the matter is, inside the industry, we know that’s how those games are made. Rockstar SanDiego was the latest example as they crunched to ship Red Dead Redemption. People go to studios making games this way because they want to ship an acclaimed title and they understand (at least they should if they’ve done their research) what is involved. The flipside is, they then gain a golden ticket to work anywhere else in the industry they choose. Once you have a GTA4 or Call of Duty under your belt, the world is your oyster. People make that trade off consciously.
One of the flip sides of long development times and frequent crunch is high staff turnover. This can be a killer for a studio that needs to maintain a high quality benchmark over time, especially in a city as starved for game dev talent as Sydney. Nonetheless, I say that crunch isn’t necessarily a sign the game will be bad (although it does likely mean Team Bondi will lose some staff to greener pastures once the game has shipped).
Threats of Studio Closure :
A lot of people seem to be worried the studio will close. That seems unlikely at this point in time, as LA Noire is far enough progressed that it will certainly make more money than it takes to complete. This relates to sunk costs and the manner in which new investments are calculated – all the money already spent has been spent, and it won’t come back no matter what you do. All you can do now is calculate how much more you need to spend (lets say it’s $8 million) and whether you’ll make that back when you release the title. Sure, you may not get back all of the sunk costs ($25 Mil?) but if you can spend $8 million today to make $20 million tomorrow you’re still better off than if you cancelled the project today.
This is the way publically traded companies approach this sort of question, with the additional complication that if they’ve mentioned the project in their earnings calls they have to explain to shareholders why they’ve cancelled it. In case you’re wondering, that’s not great for shareprices, so it’s something they tend to avoid.
For both these reasons, I doubt very much the studio will face closure. If that was going to happen, it would happen before the announced delay (and thereby extra money they’ll have paid out to the developer). Despite what Anon said in the Tsumea comments, it’s exceptionally rare for announced projects to get shut down late in the cycle – when it happens, it happens because everyone understands they’re not actually late in the cycle (ie, it’s clear there’s no way they’ll ship when they claim).
What if it’s a decent success? :
LA Noire doesn’t have to be a smash hit to put Team Bondi on track to be the most important studio in Australia. It really just needs to be okay enough to allow them to build a sequel. The most important thing for a studio like their is to build on the technology and knowledge they’ve built in order to move on to their next project. There are few teams in the world that can build truly great open world games – it would be fantastic for Australian development if Team Bondi became one of those studios.
Of course, all this said, everything could go the same way Realtime Worlds did. None of us know for sure. What I don’t understand is why everyone in Australia seems to be wishing for their failure, when with the limited knowledge we have to hand we could as easily anticipate success.
It was announced today that the government plans to “close a loophole” and require games released on the iPhone and other smartphones to apply for classification, at an expense per title of between $400 and $2000. This will have two inevitable impacts on the Australian development community.
Firstly it will result in many (nearly all) titles simply not being released in this territory, meaning that one of the great appeals of the iPhone (having access to a large amount of content easily) will go away. Very few developers will be willing to pay extra to gain access to the Australian market on the possibility that they may be able to recoup their money. Iphone development is a very hit and miss affair, and this proposal just makes misses an order of magnitude more expensive.
Secondly, this will have a brutal impact on local development. Developers will have to choose either to take the risk and pay the costs, or simply release their games everywhere else except Australia. Australian developers rely on Australian audiences to help them build global brands. Products like Fruit Ninja gain local attention and then use that to spread their wings internationally, with great success.
Certainly that was the case with Cluck It! for us. It’s initial release was spread throughout our (primarily local) networks, which helped us gain the attention we needed to get featured on the local app store. From there, we rapidly spread internationally, gaining tens of thousands of new customers from around the world.
This really seems like a case of the government acting at cross purposes to itself. On one hand, we had state and federal representatives present at this weekends excellent Freeplay conference advising independent developers how to gain government support for their initiatives. On the other, we have Brendan O’Connor making statements that potentially put the (currently thriving) local independents at risk.
I’m speaking at X Media Lab next week, and this is the talk I was going to give. Instead, I’ve opted for something completely different – because I’m changeable like that.
This piece is aimed at traditional media producers who are looking to make the move into making games, of one sort or another. The games industry of today is incredibly exciting, and it needs people of all stripes to help build incredible and inspiring content. Here are some guidelines before you dive into the new world!
Rule Zero : Games are not movies.
I went to SeaWorld not that long ago, and they had a ride called Bermuda Triangle. In a lot of ways, it felt like someone who really wanted to make a movie had been put in charge of building a ride. There was a whole bunch of narrative, and backstory as you floated through a series of caves filled with amazing set pieces. Visually gorgeous as you see all the missing spitfires and other elements that have gotten lost in the Triangle. The big problem (aside from meeting aliens around the next corner) is that the ride is no fun. It’s supposed to end with a race against time as the whole cave system collapses and you barely escape. It’s not thrilling, or exciting, or compelling. On the other hand Seaworld also has a ride called Jet Rescue which is supposed to be about rescuing animals on JetSkis. You sit down, there’s a brief bit of video from the head of marine stuff, and then the acceleration blows your face off and you rocket around a track getting flipped nearly upside down.
Jet Rescue is a much better ride, because its primary focus is on being a good ride. Rides aren’t movies, and a good movie doesn’t necessarily make a good game. The same is true (incredibly true) of games. You can fill a game with beautiful set pieces and backstory and aliens … and it can still be a terrible game. On the other hand, blocks falling from the sky can be incredibly addictive. Why do the blocks fall in Tetris? Who knows? Who cares?
Rule 1 : Play Games
You need to play games, if you want to make them. I’ve seen a lot of game projects arise, for one reason or another, from people who say sometime like this :
“I want to make a game. I don’t play them, because they’re such a degenerate waste of time, but I know how to make a really good one.”
The funny thing about this is that I hear it a lot. If you said the same thing to a film director, they’d laugh at you, and with good reason. To really understand the artform, you need to engage with it. Play games a lot, learn about what you enjoy, and take notes. By the way, watching your kids play games doesn’t count. Games are about what you do, first and foremost. What you watch and listen to comes in second place, and if that’s all you understand then you still don’t get it. It’s the same as reading the novelisations of great movies and being convinced you understand the film anyway.
It’s important enough to say it again. Games are about what you do. GTA is about driving and shooting. Tetris is about putting blocks in place. Pac-Man is about avoiding ghosts and eating dots. Call of Duty is about shooting and ducking into cover. Each of these games may have a whole bunch more stuff going on, but they’re games because of what you do in them.
Rule Two : Interaction comes first. Way first.
There are a huge number of reasons to be excited about games. I’m excited about games, incredibly so. If you’re thinking about transmedia, then I presume you’re excited about games. So it’s all good, right?
Except in many cases that’s not really the case. There’s a lot of people who want to do transmedia because they feel like they should, or because it makes it easier to tell stories, or because they read something on a blog. Games are about interaction, not about narrative in the conventional sense. If you don’t have an interaction you’re excited about, you don’t have a game. If the core of your excitement is the story you want to tell, make a movie. Write a book! A story is not a game idea, even if you think it might be. It’s a theme for a game, and that’s a completely different thing. Come back to games when you have something to offer games – which means you need to consider the actions the player can take, and the implications of those actions.
Rule Three : Narrative is context for action.
One of the great opportunities for narrative in games is as context for action. Action with context is substantially more meaningful than action without. Thus, if you’re considering getting into games from a traditional media background, odds are you’re probably a pretty experienced good storyteller, and that’s a skill you can definitely bring to bear here.
I always use GTA as the example here. Almost every mission in GTA in about driving or shooting. Sometimes shooting then driving, or driving then shooting then driving some more. However, because each mission is arranged in interesting ways and is given context by the greater narrative, people continue to play through tens of hours of the same sorts of mechanics. Narrative gives action context and that can be a great boon.
Rule Four : Gameplay is a loop, not a line.
A good gameplay loop (and a nice litmus test for whether you’ve got the game bit or the narrative bit in mind), is whether it has an in built ability to renew and refresh itself. Driving along the road in a driving game against the same five cars is fun for a bit, but once you let me upgrade and add to my car, and progressively increase the challenge of the tracks and the skills of the driver, you’ve got a game. The core mechanic (driving) let me compete (races) where success rewards me (cash) which I can use to gain additional skills and abilities (upgrade) so that I can (driving) better and win new (races) and get more (cash) and (upgrade) and (driving) and on and on.
Rule Five : There are more ways to play Horatio, than are dreamt of in your philosophy.
Not everyone will find the above gameplay loop compelling. Different things motivate different people at different times. If you want to build a mass market game, you need to develop a broadly appealing suite of options that engage different people in different ways.
The world of games includes everything from WiiFit (a game about getting stronger and thinner each day) to Facebook (a game about having a lot of friends and “liking” the things they do). Interactivity is a broad church, with plenty of space for everything from the Call of Duty and World of Warcraft end of the table through to games that can teach, or touch, or inspire. Different games take different approaches, and appeal to different people, and you can learn a lot by looking into what’s out there.
Rule Six : Build and Test, Build and Test
How do you learn about these different players and play styles, the masses of niches that make up your market? Watch them play games. Not just your games, but any old games. But your games too. Please make sure that you watch people play your games. Resist the urge to explain things to them, or help them. Whenever you open your mouth to help someone through your game, your game just lost. You won’t be there to help when the game goes out to the public, so you need to ensure that it can speak for itself. Fix those things and try again, until people can flow through your experience as seamlessly as possible. There are a million ways to entice and seduce people into learning the way your game operates, and you’ll only learn them by watching what people do. You need to understand what your game does well, and encourage people to do that.
Rule Seven : Who is your player, and what do you want to do to them?
Games are capable of providing an enormous range of emotion and experience, yet most commercial games stick to a relatively narrow niche. Action, suspense and the satisfaction of collecting shiny things. In order to really craft a great experience for people, you need to begin with a goal in mind. Understand what it is you want to do, and you’ll be well placed to achieve it.
Rule Eight : Don’t trust anyone who tries to make rules.
Game designers can’t resist making rules. It’s what we do. As true as that is, the whole world of games is barely nascent medium. There are no hard and fast rules, nor are there any guarantees for success. All of the rules I’ve listed are guidelines at best, ways to check that you’ve thought about what you want to build and considered the ways you can make that a success. If you want to throw them away, throw them away!
The only important thing, in the end, is to be passionate about games. As a new medium, there’s an incredible amount of trail yet to be blazed, and that’s incredibly exciting. Any rule made today could be irrelevant tomorrow, and the opportunities are endless. Make games. Build rules. Watch people play. Make new games. Bring something new into the world. Now there’s a gameplay loop I can believe in!
I’ll be speaking towards the end of the month (27th of July) at XMediaLab, specifically on the most common mistakes people make when trying to take a transmedia property into the gaming space. I’ll definitely turn that into an article here once done, but it’s more exciting (and probably more rant like) if you come see it in the flesh.
Then in August (14th-15th) I’ll be on a panel at Freeplay (and possibly chairing one as well). It’s all about the many ways in which play is spreading out to every aspect of the world around, which is one of my pet topics. Can’t wait to follow that one up!
Both of those take place in Melbourne, but for those at home I’ll be speaking in Brisbane later in the year (September 20-23rd) at the World Computer Congress, which I’m looking forward to. That’s a wider audience, so I’ll be covering the incredibly varied state of games as they are at the moment.
Hope to see you at some or all!
It’s interesting to watch the dilemma that Reddit is currently in. For those not up to speed, they’ve become stuck in a position of low cash flow, and they’ve asked for donations in order to hire more staff (beyond their current four engineers). This has been widely reported as “internet company begs for survival.” I think they’re in this situation due to one of the odder (but strikingly common) problems that befall internet companies : they listen to their users TOO MUCH.
How can that be? Customer focus is good, right? Except in this case, not so much. Customer focus has paralysed Reddit and put them in a near impossible situation. Many internet businesses hit this point as they grow – a pivot point that lies between simply growing their user base by catering to a desire/need of a group of users and making decisions about how to grow into a sustainable business. As the skills and behaviors required for each stage are different lots of companies reach that turning point and have a great amount of difficulty making the transition.
I remember working for Alex Garden at Relic, and one of the things that really impressed me was that he was able to work out when his early approach, the one that got the company off the ground and created Homeworld, was no longer useful to the growth of the company. He hired a couple of great people to run the business side, and slowly backed away from the day to day running of the company. Of course, that also meant that he got bored and began to follow other dreams, but it also meant that Relic grew into the strong developer that could give us Company of Heroes and Dawn of War.
In this case, it seems like Reddit has adopted a policy of not making any changes that would offend the userbase. So they make no changes at all, because the userbase isn’t a single individual, with likes and dislikes whose whims can be catered to. No. The userbase is made up of a mass of individuals and niche groups, each one with it’s own preferences and biases. There is literally no action Reddit can take that will not cause offence to some substantial portion of it’s customer base.
Bam. Stasis. Change meets with anger from a vocal userbase, so no change ever happens. Only the status quo is safe.
Reddit has painted itself into a corner, and especially so now. They’re no longer in charge of their own destiny, they’re driven by users. Users who most certainly do not have Reddit’s best interests in mind. As everyone knows, the surest way to make sure no decision is made is to form a committee. Reddit has this problem writ as large as possible. No matter what they do now, if it represents movement, there will be a public outcry. For fear of weathering that outcry, they do nothing. Doing nothing means eventual, slow, death.
The irony here of course, is that it’s precisely the users voices that has made Reddit strong through the first phase of their growth. It’s those voices (and the traffic they generate) that represent the unique asset Reddit has in the market. Without users, Reddit is nothing. To look to the future however, Reddit needs to make decisions that will undoubtedly anger some of those users, in order to better serve the rest.
What does this have to do with games? In a lot of ways, this is the same problem that can overtake large game companies with strong public fanbases. A sense of entitlement from the userbase means that even small changes are met with rabid online hysteria. The thing that key game studios have learned (and Reddit can profit from understanding) is that this hysteria does not necessarily represent the actual BEHAVIOR of their users. Sometimes it does, sometimes it doesn’t – and the only way to be sure is to try it and see.
For example, Blizzard is well known for not making key game design decisions (lets not touch RealID here, for a host of reasons) on the basis of their forums. If they did, they’d have to improve and nerf pretty much every character class simultaneously. Read a character forum, and everyone thinks their particular class is being hard done by. If you’re looking to gather an understanding of peoples subjective experience, forum information is great. However, if you want to balance the game, you need to look at the objective information – who wins and loses in PVP, how effective is this character in various scenarios, and so forth. Fortunately, this data is something Blizzard has access to enormous amounts of – and it figures into their decision making process substantially.
As another example of just how much these online perfect storms generally don’t reflect eventual user behavior, there was a huge furore over COD : Modern Warfare 2 and it’s lack of dedicated servers. It was the biggest news across a host of gaming sites for months, and people promised boycotts left right and center. Below, you can see the impact of the Steam boycott group, shortly after the games release.
Given that COD:MW2 went on to be the highest selling game of all time up until that point, you can’t argue that the users behavior reflected the intensity of their claims.
The real key to this piece is that there’s a simple way out of this problem for Reddit – however, it’s going to inevitably annoy some users. Placed against this outcome, the slow death of Reddit is a far worse situation for the great majority of users. So the people running the site need to take a step back from firefighting, and make some decisions about the long term direction and sustainability of Reddit. Most importantly, they need to be prepared to make some people unhappy in order to build the Reddit of the future. That means taking seriously a vision for a Reddit that’s financially sustainable and capable of growth. That doesn’t mean one that loses what’s best about Reddit today, but it does mean understanding what that is and nurturing it.
To be absolutely clear – doing nothing to make Reddit profitable, for fear of making some users unhappy, will absolutely and categorically destroy Reddit in the long terms. Making hard decisions and deciding what sort of community they want to build into the long term is the only way they’ll build something that’s right for the majority of their users.
The wonder of the internet, of course, is that users who happen to be unhappy with the new world order will represent a great opportunity for the next people who come along with a great idea on how to build a community. They’ll migrate there, and provide a strong evangelical userbase, which will attract new users until the whole thing suffers under it’s own weight … and then the cycle of life repeats itself.
An additional edit :
So, Reddit has announced they’ve got 6000 gold users and counting, and that makes their appeal a solid gold success. They may be right, but it really doesn’t change my perspective above. The trouble with this approach is that they’re now falling into the trap of doing what’s convenient (catering to the 6000+ with new features and building something like the Total Fark model) rather than setting a plan for how they want Reddit to develop and going there. They’re merely grasping at opportunities as they approach, rather than being strategic. I repeat again what I said above – this isn’t actually to the benefit of the greatest number of their users. Focusing on the sustainable business and userbase they desire would serve them best – and the majority (although not every one of) their users, too.
 It’s worth pointing out that Activision has done themselves some long term damage to their brand as a side effect of this decision. Exactly how much damage remains to be seen.
On the 23rd of June I’ll be talking at the DIAlogues
If you’re interested in getting an overview of the dramatic changes the games industry has gone through, and the opportunities that will create – this is the talk for you! Hope to see you there!