By Morgan Ramsay — December 18, 2010

EA Games president Frank Gibeau recently told Develop Magazine:

We “are very comfortable moving the discussion towards how we make connected gameplay—be it cooperative or multiplayer or online services—as opposed to fire-and-forget, packaged-goods-only, single-player, 25-hours-and-you’re-out. I think that model is finished. Online is where the innovation, and the action, is at.”

As expected, the mere hint that what consumers think of as single-player games are on their way out has sparked a few fires. Gibeau’s detractors wrongly assume that he has declared story mode an endangered species. In fact, he said nothing of the sort. Gibeau asserted that the publisher’s interest in “offline” games is fading, and that connectivity will play an even more significant role in the future of the business of video games.

Forewarned Is Forearmed

Gibeau was not the first to arrive at this conclusion. He was also not the first to be misunderstood. Sony Online Entertainment CCO Raph Koster (now Metaplace cofounder and Playdom VP) made waves in 2006 when he suggested during a panel discussion:

“The entire video game industry’s history thus far has been an aberration. [...] The single-player game is a strange mutant monster which has only existed for 21 years and is about to go away because it is unnatural and abnormal.”

Two years later, Atari president Phil Harrison (now general partner at London Venture Partners) echoed the same thought and was received just as poorly:

“I just don’t think consumers want to be playing games that don’t have some kind of network connectivity to them, or some kind of community embedded in them, or some kind of extension available through downloadable content.”

In my upcoming book Gamers at Work, EA founder Trip Hawkins reflected on social games and Digital Chocolate’s success with virtual goods, a form of connected gameplay:

“Games are going mainstream, so it is only natural that the business model would become less like a theatrical film and converge towards TV and the web. [...] The game industry will have to migrate more to what will work better in the future.”

What We Can Expect

Setting aside the challenges of communicating this message, here’s what we can expect going forward as entrepreneurs, C-level executives, and senior managers. Connectivity is a key component of corporate strategy at every major publisher.

Video games whose feature sets include online, such as achievements, leaderboards, downloadable content, social networking, and multiplayer gameplay, can expect to receive either preference or greater investment. Currently, publishers may not require that new title submissions include online features; however, as publishers invest more heavily in connectivity, there may come a time when that will change, which may not be very far off.

In addition, the console market is largely controlled by the video game industry’s big three, Nintendo, Sony, and Microsoft; and the catalogue of products available to the respective platforms is dominated by titles produced by the majors. Platform owners can be expected to invest in more and new online capabilities while publishers can be expected to encourage console properties to take advantage of those capabilities. With retail continuing to play an important role as a distribution channel for developers, and with retailers continuing to focus on consoles, connectivity is shaping up to have serious momentum.

Furthermore, movement toward the ubiquity of connectivity may also indicate that top-tier publishers are leaving behind the “unconnected” video games space, not because of diminishing demand but simply because they are betting that connectivity is far more valuable to extending franchise life cycles and offers more opportunities for monetization. There may eventually be money on the table for mid-tier publishers, startups, and other companies deigning to serve those who are rapidly becoming a niche market.

Morgan Ramsay founded Entertainment Media Council and serves as President/CEO. He is also the author of Gamers at Work: Stories Behind the Games People Play (Apress, 2012).

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