“What’s a golden swan? That’s a rare, fortunate event that has major consequences…a metaphor that “describes an event that comes as a surprise, has a major effect, and is often inappropriately rationalized after the fact with the benefit of hindsight,”…. That describes many of the megahit games very well indeed – companies tend to think very highly of themselves after creating such a megahit, but history shows that caution (and conservative spending) is indicated.”

An article from the [a]listdaily describes business models of major publishers that have been around a long time and new companies that have been successful in social and mobile games. Some of these companies derive the bulk of their revenue from just one or two titles. What kind of risks are they taking?

Publishers and developers with major hits and powerful brands are trying to mitigate their risk by diversifying into new platforms and markets. Counting on major spenders—”whales,” or big surprise hits, “golden swans”—is a good way to lose investor confidence and create a volatile condition in an otherwise successful company.

We all know what a one-hit wonder is in the music business, but we don’t use that term in video games. However, we probably should. Companies with a big hit should concentrate on the follow-up, be it a new title or a new platform. Even a new business model such as publishing or even transmedia.

Support your hits, iterate and grow their worlds—but also grow your business by using the influx of capital to expand, create and build.

Golden Swan

 

Read the original article at: Hunting Whales and Golden Swans | alistdaily.

image courtesy [a]listdaily