CD-ROM won't go quitely............................................
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MILIA MARKS NEW DAWN FOR CD-ROM
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Cannes - A new mood of cautious optimism pervaded this year's Milia exhibition. Where CD-ROM publishers once packed their stands to the gills with new titles, this year launches were few and far between, although there were plenty of existing titles on show.
Smaller stands and smaller egos were the order of the day. A number of companies were noticeable by their absence, and the aisles were quiet after the first day. Nevertheless, the consensus was that good business was being done by those who attended.
Dorling Kindersley, the jewel in the crown of the UK multimedia industry, had a much-reduced presence at the show, following the shedding of 50 workers as part of a cost-cutting exercise late last year. Alan Buckingham, managing director of DK Multimedia, told IM that the workforce was now down to 100 but he remained quietly confident, albeit a sadder and wiser man.
Even the Internet crowd, ubiquitous and full of confidence in 1997 as they stole the venture dollars from the ailing CD-ROM companies, had come to terms with the realities of the market. A number of Internet-based companies exhibited, but most were not publishers; rather, they were advertising agencies and search engines fishing for likely partners.
Despite the show debuts for several big-name games companies, including Sony Computer Entertainment, there were no glitzy, Hollywood-style shows this time; the closest Milia got to glamour was the appearance outside the Palais des Festivals of Bugs Bunny and chums, to celebrate the acquisition of digital rights to the Warner Bros characters by a buoyant Infogrames. Bruno Bonnell, head of the French publishing house that acquired Ocean and Philips Media last year, was ebullient as he announced record turnover for the year.
And a number of new industries were represented for the first time, offering hope for the future. The games companies - with their big budgets and emphasis on high production values - gave the multimedia people serious food for thought at several of the conferences. If their message is heard, we could witness the emergence of much more compelling content next year.
Equally, DVD - with its ability to deliver higher-quality video and Hollywood support - was the focus of much attention, as early titles saw the light of day for the first time. One first came with the announcement of the first children's educational DVD-Video, Cosmic Family, from French games publisher UbiSoft. It was difficult to see what DVD brought to the party, the title being much like any other point-and-click cartoon CD-ROM, but it may have had something to do with sponsors Thomson, who could use the title to promote DVD-Video players to a wider audience in its early days.
Teletubbies Goes CD-ROM
BBC Multimedia, the interactive arm of the corporation's Worldwide commercial publishing division, was out in force at Milia, both offline and online. A late arrival in CD-ROM publishing, it has fast moved into a prominent position, continuing to release a steady (and successful) stream of titles. Other CD-ROM publishers have cut back noticeably on new title production. It overtook leading publishers Broderbund and Dorling Kindersley in December in the children's and education genres and is also ahead of Disney in terms of UK CD-ROM sales, according to BBC Multimedia's Claire Rubinstein. It also had six of the top ten titles in the December children's charts, Rubinstein said.
It had to happen: at Milia BBC Multimedia disclosed plans to launch a CD-ROM based on the BBC's hugely successful Teletubbies children's TV programme. Teletubbies will join other CD-ROMs based on BBC children's properties, including Noddy, Pingu and the best-selling Wallace & Gromit.
Development of the Teletubbies CD-ROM has just started, Rubinstein, with a UK launch likely in August. The title will be "learning through play," Rubinstein told IM, and will be designed for a pre-school age group. Rubinstein said she did not know the details of plans for worldwide release, but previous evidence points to a worldwide launch. The Noddy CD-ROM, for example, has been localised into 12 languages and BBC Multimedia titles are on sale in Europe, Africa, the Americas, the Far East and Australia.
Milia also saw the debut of The Really Wild Show (launch date April 1998) and Wallace & Gromit Print-O-Matic, the third CD-ROM release based on the Aardman Animations franchise, scheduled for release in July 1998. The Really Wild Show features a Web link for news updates.
BBC Multimedia's commercial Web publishing division, beeb (visit beeb.com), also showcased new Web sites at Milia, but these tend to be aimed at an older (usually male) audience, in keeping with the Web demographic.
United Spreads Its Wings
Anglia Multimedia, part of the United News and Media publishing giant, simultaneously gained a sibling and a new parent with the launch of the games company, Black Friar, at Milia. Anglia and Black Friar will sit jointly under the umbrella of the newly created United Interactive; Anglia will continue to focus on lifestyle and educational products. Ten titles will form the first wave of launches, of which nine will be developed in-house. Titles to launch this year include Republic, an adult action thriller for the PC; Rocky Horror Interactive, a PC title based on the film; and Dodgem Arena, a combat skateboarding game for PlayStation and PC. Another title, Reah, is slated for release on PC using both CD-ROM and DVD-ROM.
Ajay Chowdhury, managing director, was keen to stress that the launch of Black Friar was not the first move out of non-games consumer multimedia. "It's quite the opposite. Anglia has had a record year," he told IM. "Last year retail revenues grew by 175 per cent and profits grew significantly - and it was indeed profit." Anglia's growth outpaced the market as a whole, which grew by 70 per cent, according to Chowdhury. He pointed out, however, that the market was consolidating and that growth was coming from a few companies.
Another reason for Anglia's apparent prosperity is that it has avoided reliance on penetration of the larger US market in order to turn a profit. In a report earlier this year, stockbroker Merrill Lynch cited this reliance as a factor in Dorling Kindersley's recent troubles. "A lot of people have been suffering because of the US," said Chowdhury. "Our average development cost is kept down to Pounds 50-60,000 for non-games. We sell in the UK and anything we sell in the US is jam." In contrast to many companies, Anglia is building its in-house development staff rather than moving to an outsourcing model. The company now has three internal development teams, of which two were started last year. "We're actually investing in development," said Chowdhury. "The reason is low cost."
The recent currency turmoil in East Asia has also hampered profitability for those Western developers, including Anglia, who distribute titles in the area. The crisis could also have the knock-on effect of flooding the Western markets with English language titles, as Asian exporters use the exchange rate to their advantage. As a result, many companies are looking at the possibility of setting up development houses in Asia to insulate against potential problems. "We're looking at the possibilities in India," said Chowdhury. "The turmoil has affected us slightly. Our distributors (Facilities Interactive, in which Anglia holds a 20 per cent stake) have held up OK, but the strength of the pound has been a problem."
Contacts: Ajay Chowdhury, managing director, United Interactive, tel: +44 171 579 4400; anglia.co.uk.
Dave Lee, director, BBC Multimedia, +44 181 576 4219
Anglia Education has just launched a subscription online service. Members will also receive Anglia's entire Web site on CD-ROM, for fast network access within schools and to reduce the schools demand on Internet access (with concomitant call charges).
IM Analysis
Sales of PCs continue to grow, as does the penetration of CD-ROM drives and the Internet into the homes of ordinary people. In the new leaner, meaner CD-ROM and online (and possibly DVD) market, the opportunity has never been greater to satisfy their thirst for quality content. Publishers appear to have learned the lessons. Milia 1998 signalled that the turning point had been passed: the multimedia industry had got real. |
