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THE EDGE POST

How Ubisoft Started?



Ubisoft is a French video game publisher headquartered in Saint-Mandé with development studios across the world. Its video game franchises include Assassin's Creed, Far Cry, For Honor, Just Dance, Prince of Persia, Rabbids, Rayman, Tom Clancy's, and Watch Dogs.


Founders


The family firm of the Guillemots was well-established as a provider of services to farmers in the Brittany area of France and beyond by the 1980s. Christian, Claude, Gérard, Michel, and Yves, the five sons of the family, all pitched in to help their parents with the company's sales, distribution, bookkeeping, and management before they went off to college. After finishing college, all five returned to work in the family firm, where they had obtained valuable business expertise. The idea to sell other things useful to farmers came from the brothers, and Claude started the diversification process by selling CDs. The brothers' business eventually grew to incorporate personal computers and related software, such as games.


They realised in the 1980s that importing computers and software from France was more expensive than importing the identical items from the United Kingdom and sending them to France, so they decided to start a mail-order business based on these products. As long as they ran the business independently and divided the profits fairly, their mother said they could do it. Guillemot Informatique, established in 1984, was their first venture. At first, they exclusively supplied by mail order, but eventually, French merchants began placing orders with them since they were able to undercut other suppliers by as much as 50% on the price of some titles.


In 1986, this firm's revenue was at 40 million francs (around $5.8 million in today's dollars). The brothers started Guillemot Corporation in 1985 to distribute computers and related components. The brothers, who were already familiar with the publishing and distribution sides of the industry, saw that video game software was becoming a viable investment and chose to enter the development side. On March 28, 1986, the brothers created Ubi Soft, then known as Ubi Soft Entertainment S.A. It was decided that the name "Ubi Soft" would best express the concept of "ubiquitous" software.


Early Success


In 1996, Ubi Soft listed its initial public offering and raised over US$80 million in funds to help them to expand the company. Within 2 years, the company established worldwide studios in Annecy (1996), Shanghai (1996), Montreal (1997), and Milan (1998).


A difficulty that the brothers found was the lack of an intellectual property that would have a foothold in the United States market. When "widespread growth" of the Internet arrived around 1999, the brothers decided to take advantage of this by founding game studios aimed at online free-to-play titles, including GameLoft; this allowed them to license the rights to Ubi Soft properties to these companies, increasing the share value of Ubi Soft five-fold. With the extra infusion of €170 million, they were able to then purchase Red Storm Entertainment in 2000, giving them access to the Tom Clancy's series of stealth and spy games.Ubi Soft helped with Red Storm to continue to expand the series, bringing titles like Tom Clancy's Ghost Recon and Tom Clancy's Rainbow Six series. The company got a foothold in the United States when it worked with Microsoft to develop Tom Clancy's Splinter Cell, an Xbox-exclusive title released in 2002 to challenge the PlayStation-exclusive Metal Gear Solid series, by combining elements of Tom Clancy's series with elements of an in-house developed game called The Drift.


Ubisoft established another IP, Assassin's Creed, first launched in 2007; Assassin's Creed was originally developed by Ubisoft Montreal as a sequel to Prince of Persia: The Sands of Time and instead transitioned to a story about Assassins and the Templar Knights. In July 2006, Ubisoft bought the Driver franchise from Atari for a sum of €19 million in cash for the franchise, technology rights, and most assets. Within 2008, Ubisoft made a deal with Tom Clancy for perpetual use of his name and intellectual property for video games and other auxiliary media. In July 2008, Ubisoft made the acquisition of Hybride Technologies, a Piedmont-based studio. In November 2008, Ubisoft acquired Massive Entertainment from Activision.In January 2013, Ubisoft acquired South Park: The Stick of Truth from THQ for $3.265 million.


Creativity Downfall


Ubisoft is considered as Triple A game publisher and developer with deep pocket and lack innovation known by it’s fans. Since, almost all the innovation is being done by the indie development scene. Which then gets bought by the AAA publisher, closed down, and their IP forced into limbo. I guess being the big fish in the pond has its perks. That’s because of three very real issues. There is no incentives for company like Ubisoft, to compete in it’s market since it’s easier to bought the smaller company or just burn it to the ground with legal action, contract and etc.


Innovation is dangerous and has the capacity to literally bankrupt businesses if the game fails. While the AAA industry can take the hit, smaller company would very much not want to deal with the hassle of laying people off. Second, Lack of direct competition prevents AAA developers from having to push the envelope for the genre of the game’s they make. Firstly, the power, the AAA industry can literally bury indie developers in legal action, contracts, or straight up go for the hostile take over. Many think the reason why some may consider the AAA industry including Ubisoft “dying” is because none of them are really directly competing in specific genre’s anymore. For example when the AAA industry was just getting onto its feet a lot of new genres were innovated. A great ones to review is the rise of the RTS, FPS, Multi Player, and Open World genre. When these genres spurred a surge of interest consumers basically bellowed for more, so the industry abides.


In this case games are not art, everyone needs to understand that for profit games are not art. This had been a major issue for Ubisoft since they opt out from Steam (Major Gaming Platform) in protest of profit sharing between the store platform and the publisher. It deepen the anger of Ubisoft fans that also want to put their game in the same platform. Games are a consumable product with the intention to make money for a business. Therefore if consumers are finding that the current games being produces are not what they want, they simply ignore and company become irrelevant.


Future of the Gaming Industry

The future of the video game industry looks dazzling. Consumer demand is growing, technology is advancing quickly, and new monetization models are taking off. Bain’s analysis forecasts that global revenue for games could grow by more than 50% over the next five years . And gamers’ foothold in virtual worlds—collectively called the metaverse—is far ahead of other consumers.


Though gamers have historically trended younger, our data suggests fewer gamers are aging out. This change will likely be supported as gaming becomes the foundation for other media and nonmedia experiences.


he free-to-play model and paying for DLC ( Downloadable Content ) has been critical to the success of virtual-world games over the last decade by massively expanding the addressable player base and enabling the network effects required for those games to succeed. At 78% of games’ revenue, the free-to-play model itself has advanced with ad-operated becoming more accepted on mobile, and in-app purchases becoming more differentiated. The economics of free-to-play are likely to further explode as virtual-world games become a foundation for the numerous other monetizable experiences (for example, live virtual events, commerce) and more players join the metaverse. However the downside of this model, had been criticized for it’s predatory purposes. Older Gamers on the other hand prefer to not play the game instead paying extra things on the game.

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