IP Profile: Burnout

Burnout – The Stats

Estimated Total Unit Sales: 16 million (console and PC)

Number of Iterations: Seven games

Game Release Timeline
1997: Sub-Culture (Criterion’s first internally-developed game, UbiSoft)
2000: Burnout (Criterion Games, Acclaim Entertainment), RenderWare 3 created
2002: Burnout 2: Point of Impact (Criterion Games, Acclaim Entertainment)
2004: Burnout 3: Takedown (Criterion Games, Electronic Arts)
2005: Burnout Legends (Criterion Games, Electronic Arts)
2005: Burnout Revenge (Criterion Games, Electronic Arts)
2007: Burnout Dominator (EA UK, Electronic Arts)
2008: Burnout Paradise (Criterion Games, Electronic Arts)

Ownership History
1993: Criterion Software founded as a wholly-owned subsidiary of Canon Inc. to specialise in the development of graphics rendering technology.
1997: Criterion forms internal games development studio to help development and marketing of its struggling middleware business.
1999: Burnout rights secured by Acclaim.
2002: Burnout 2: Point of Impact publishing rights secured by Acclaim Entertainment.
2004: Burnout 3 publishing rights acquired by Electronic Arts.
2004: Criterion Software Group acquired by Electronic Arts for $68m in cash. Acclaim Entertainment goes into liquidation.

Creator: No single individual credited

GAME INCEPTION AND GROWTH
Burnout was created in 1999/2000 by the internal games development division of Criterion Software Group. It made use of RenderWare 3, at the time the most recently released version of the company’s core middleware software and was used by Criterion to assist in the development of RenderWare 3 and its marketing and sale. Although reworking the well-known racing genre, the game was innovative in that it was designed as an arcade-style car racing game with a greater emphasis on ease of use and instant gameplay gratification rather than the accurate modelling of car dynamics and less immediate gameplay features in contemporary franchises of the time such as Gran Turismo and Colin McRae.

Unlike most of the successful racing games of the period, Burnout was set on urban and country roadways (rather than dedicated racing tracks) amongst non-racing traffic as well as other racing competitors. Such ‘illicit’ gameplay mirrored Grand Theft Auto in enabling gamers to do things on screen which they would not be able to do (or would be prosecuted for doing) in real life. Players were rewarded for setting time records, finishing ahead of opponents and, uniquely, for driving aggressively. As the Burnout series progressed, more emphasis was placed on the latter gameplay concept and the accompanying slow-motion replays that allowed players to show off their driving stunts and recklessness in a highly cinematic format.

Burnout 3: Takedown was a pivotal release, which condensed the kernel of aggressive gameplay at the heart of the game into the main game mechanic. The first game published by Electronic Arts, Burnout 3 placed the concept of causing your opponents to crash spectacularly and driving as recklessly as possible at the heart of the gameplay, with a ‘burn meter’ encouraging players to drive head-on at incoming traffic or corner at great speed. The combination of the two dramatically opened up the North American market, a territory in which the previous Burnout titles had failed to make a critical or commercial impression under the auspices of Acclaim Entertainment. This trend was continued with Burnout Revenge, Burnout Legends and Burnout Dominator (the first to be developed outside of Criterion) which incorporated varying elements from all three previous games.

Burnout Paradise, the latest in the series, represents a relatively radical departure from the traditional Burnout gameplay moving the game from constricted road-based courses to open world design in which players are granted more control. Burnout Paradise also represents the most comprehensive embracing of network technology not just for multiplayer interaction but also for the maintenance of a strong online Burnout community and the dissemination of substantial new content and gameplay updates by Criterion.

The Criterion-developed Burnout games have consistently been well received by the games media and Criterion remains one of the most respected studios in the market. Burnout itself remains a key driving franchise for EA sitting surprisingly successfully along side its other major racing franchise, Need For Speed, a series that had increasingly begun to mimic Burnout for gameplay features and game style. Criterion’s Burnout team remains focused on evolving Burnout Paradise having announced two major new updates due in the second half of 2008 as well as the PC version.

COMPANY INCEPTION AND GROWTH
Criterion Software, a wholly-owned subsidiary of Canon Inc., was formed in 1993 by David Lau-Kee, who had previously founded and headed up Canon’s European research division. It was established to continue the research and development of graphics rendering technology begun a few years earlier and which was originally designed to take advantage of Canon’s computer and imaging hardware. Criterion began to move into games shortly afterwards and began to re-focus its RenderWare software towards 3D and games rendering but met with limited success.

Criterion would undoubtedly have failed if it had not been for the patience and deep pockets of its parent company. The company decided to complement its struggling middleware business in 1996 with the establishment of a full games development studio in an attempt to diversify its revenue streams and gain a more detailed understanding of the challenges of games development. However, its first three forays into full games development, despite steadily improving critical and commercial reception, failed to propel the studio into profit.

The turning point for Criterion came in 2000 with the release of RenderWare 3, a complete middleware solution catering to, amongst other games platforms, the recently released PS2 console. At that time, many developers were struggling to manage the technology leap from PlayStation to its considerably more complex successor, and a technology solution to solve some development issues found an immediate market. RenderWare 3 obviated the need for extensive technology development by providing a ready-made engine around which, in theory, almost any style of game could be built. Developed in parallel to this was Burnout, Criterion’s fourth internally-produced game.

With Canon’s balance sheet to support it, and with extensive reliance on the RenderWare 3 technology, Criterion was able to self-finance the development of Burnout and managed to retain the full brand as well as technology IPR when it sold the publishing rights to Acclaim. The game’s success in Europe, in particular, gave rise to a sequel which was also signed to Acclaim on improved terms and developed in just eight months, a potent advertisement for RenderWare.

Despite combined sales of 2m units, the Burnout titles, however, had not fared well in the USA. This was compounded by the fact that Acclaim was experiencing a restricted financial position and it simply lacked the financial muscle to provide proper marketing and sales support in its home territory.

Around the same time, Criterion had begun to receive approaches from EA, interested in both its middleware as well as its games (Burnout 3 and a new IP called Black). This led to Criterion jumping ship from Acclaim to sign the publishing rights to both IPs to Electronic Arts. As the value and quality of the IP quickly became clear, later in the same year EA completed an outright acquisition from Canon of Criterion’s games and middleware businesses for $68m in cash plus the assumption of Canon debt.

ANALYSIS
Although Electronic Arts’ acquisition of Criterion brought in both games IP, development teams and market-leading middleware technology, it could be argued that Electronic Arts’ decision to acquire Criterion Software was based more on the potential of the Black game, then in early-stage development, and the desire to bring the well-known and already successful Burnout IP in-house than to acquire the RenderWare technology and staff. By the time of its acquisition, Criterion was comfortably the middleware market leader. The market’s reasonable expectation was that Renderware would dominate the PS3/360 cycle too. However, the RenderWare licensing business quickly (and unsurprisingly) died after the acquisition as third parties decided against relying on their largest rival for a core part of their development. Plus, EA reduced third party support for the technology. Although the middleware division was intended to form the heart of EA’s next-gen technology development, EA scaled back this ambition and even went on to licence other third party middleware (such as Epic’s Unreal Engine 3). The RenderWare division is now part of a global EA Technology division with its main centres in Vancouver and Guildford.

The value to EA of the acquisition of Criterion’s middleware business was therefore as much its market-spoiling effect (it forced many of its rivals to find alternative tech) as its utility as an technology platform, both of which are difficult to measure but likely to be limited compared to the value gained from the acquisition of Criterion’s games development business and its accompanying IP. Electronic Arts has only recently formally revealed sales figures for the Burnout franchise although we estimate that Burnout 3, Burnout Legends and Burnout Revenge have together accrued over 6m unit sales whilst Black went on to achieve over 2m unit sales. This would have represented over $200m in very profitable (given Criterion Games’ relatively low development costs) revenues for Electronic Arts in the two years following the acquisition of Criterion. Electronic Arts had already seen the potential of the Burnout series with 2 million units recorded by their poorly performing and financially hamstrung publishing rivals Acclaim Entertainment and would have been very confident of considerably greater sales success for the franchise. As such, Criterion’s acquisition is a typical example of an acquisition driven by successful triple-A IP.

The Burnout franchise succeeded because of a combination of reasonably novel and high quality games design and the support of its two owners, Canon and Electronic Arts. For many years Criterion, as a subsidiary of Canon, was a heavily loss-making division that relied entirely on the financial support of its parent. This was critical also for both the subsidisation of the company’s games development business (for whom the creation of a hit product was just one of a number of business goals) as well as its ability to retain its games IPR when securing a publisher. Electronic Arts, on the other hand, provided the platform from which the Burnout franchise was able to expand its appeal and substantially increase its sales.

CONCLUSIONS
– The original game had a short learning curve, instant gameplay gratification and mass-market design appeal

– It offered the novelty of aggressive driving gameplay features but also the use of roads populated with non-participating (but fully interactive) traffic

– Quality of cinematic visual style for replays and use of blurring to add to sensation of speed

– Distribution, marketing and sales might of EA backed Burnout 3 and subsequent releases

– Use of RenderWare middleware allowed developers to focus on design and gameplay enhancements (rather than technology development) for the first Burnout titles