Business models for Serious Games developers - transition from a product centric to a service centric approach.

Abstract

In the context of the serious games industry, up to now the most commonly used BM among developers representing SMEs consists in offering an individual product to the customer, based on tailored one-of a kind production. Such production has high costs and low re-usability and leads to a long time-to-market. For an industry dealing with products highly dependent on technological advances, this implies high risks for failure and thus being put out of business. Consequently, an increasing number of Serious Games developers are struggling to survive. These trends are not specific for the SG development sector, but can actually be observed in several others, like software industry as well as the manufacturing industry, where a transition to less product-oriented BM can be observed. This article is based on an analysis of cases studies to outline how such a transition might be possible also within serious game industry, but also to discuss the threats and opportunities of the transition, both based on case studies as well as on comparison with experiences in other industries

A Multi-Sided Platform to Activate the Sharing of Digital Labs

“…The serious game industry faces similar challenges, according to a report by the Game and Learning Alliance (GALA) which we saw at labs for education [72]. Serious game business models and strategies are often characterized by a niche strategy, are highly individualized, are cost-intensive, are subject to low reusability, and the funding scheme shows a high level of involvement from government or non-profit organizations [72]. Similar to digital labs, market expansion can be achieved either by increasing the number of potential customers or by finding radical approaches to reduce costs and generate new revenues, otherwise they will remain in quality niche markets.…”

“…Experiences from the serious game industry should help to better understand the challenges of the supplier side. The serious game industry faces similar challenges, according to a report by the Game and Learning Alliance (GALA) which we saw at labs for education [72]. Serious game business models and strategies are often characterized by a niche strategy, are highly individualized, are cost-intensive, are subject to low reusability, and the funding scheme shows a high level of involvement from government or non-profit organizations [72].…”

“…Similar to digital labs, market expansion can be achieved either by increasing the number of potential customers or by finding radical approaches to reduce costs and generate new revenues, otherwise they will remain in quality niche markets. A transition to a service-oriented business model, shows on the basis of two examples how thereby new markets are entered [72]. Here, the tangible product is not the unique selling point, but a range of (customizable) services.…”

Scenarios in a serious game for training communication skills

“…Serious games bedrijven zouden kunnen profiteren van herbruikbare en interoperabele componenten op generieke devices om een serious game te ontwikkelen met een snellere time-to-market [100]. Serious games bedrijven volgen echter vaak een nichestrategie en maken serious games met een lage mate van herbruikbaarheid en interoperabiliteit [37]. Dat zou kunnen verklaren waarom er niet veel generieke componenten algemeen verkrijgbaar zijn in de serious games industrie.…”

“…Serious games companies could benefit from reusable and interoperable components on generic platforms to develop a quality serious game with a faster time to market [100]. However, serious games companies often follow a niche strategy and produce customised products, with a low degree of reusability and interoperability [37]. These factors coupled with operating in a niche market, could perhaps be a reason that generic components are not widely available in the serious games industry.…”