The “AAA” Game: Where It’s Been, Where It’s Going, and Did It Kill the “Mid-Tier” Game?

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With a new generation of consoles almost upon us, there is the worry that the spiraling budgets and massive teams required to create “AAA” games is hurting the industry. But for all the hand-wringing about how the “AAA” game is detrimental to mid-size developers, no one can seem to agree on what exactly a “AAA” game is or when the “AAA” designation was even first used. In attempting to solve this etymological mystery, I found that the “AAA” designation shares much in common with Supreme Court Justice Potter Stewart’s obscenity test from a 1964 case: “I know it when I see it.” But I also found out that “Will the AAA game survive?” is probably the wrong question to ask.

“AAA”: Tracing Its Origins
No one knows when the first letter grades were handed out in schools, but it’s widely believed that the grading system was developed in Sweden in the mid-1850s. The system was first imported into the United States by Augustana College in 1860 and was popularized by Mount Holyoke College beginning with the 1897 school year.

Before video games, the general public was probably most familiar with the “AAA” designation thanks to the media’s obsession with credit ratings. The “AAA” rating was created by Moody’s in 1909 and was considered the highest score an investment could receive. The familiar “AAA” to “D” scale was later designed by Fitch Ratings in the year 1924.

So letter grades and the “AAA” designation existed for a long time before the video game industry ever got a hold of them. Ryan Henson Creighton, a developer at Untold Entertainment and the driving force behind the upcoming Spellirium, recalls that he first encountered the “AAA” designation in 1997:

The first time [I] heard the term “triple-A”, [I] could smell a turd. [I] was working behind the counter at a video game franchise – one of these Buy/Trade/Sell places.

One day, [I] saw Game Boss intently studying a sheet full of facts and figures. [I] asked him what it was all about, and he said it was an order sheet from his distributor. Next month’s upcoming games were listed, and Game Boss was going over them to decide how many copies of each game he would order.

Beside each game was a quality ranking written by the distributor. They were letter ranks that the distributor used to help retailers with their game orders. There were “A” games, “B” games, and “AAA” games. Magically, no game ranked below a “B.”

I attempted to contact Creighton’s former employer to corroborate his memory, but their corporate office never responded to my requests.

The first documented use of the “AAA” designation actually occured in a press release published by Infogrames Entertainment in June 2000. The press release publicized Infogrames’ acquisition of Paradigm Entertainment, the developer behind Pilotwings 64. According to Infogrames, which, ironically, was often seen as a publisher of budget-level titles by many gamers, they purchased Paradigm to “strengthen [their] lineup of ‘triple A’ titles.”

Less than three months later, IGN published an editorial, titled “Save Our Sega: Deux Ex,” that asked why Eidos Interactive wasn’t bringing a “AAA game” like Deus Ex to the Dreamcast. The use of “AAA” as a descriptor exploded in 2001 and a developer with Sony Computer Entertainment America (who wished to remain anonymous) told me that the phrase was entrenched within the walls of the publisher’s Foster City headquarters by 2002: “They’ve always been called AAA games internally. There’s no official designation of what constitutes AAA. It’s something that costs tens of millions and has a huge team.”

The Rise and Possible Fall of “AAA” Games
So the “AAA” name has a lengthy history within the game industry and the phrase was truly popularized as we’ve entered the Internet age. But there is very little consensus on what exactly a “AAA” game is. Greg Kasavin was on the front lines of the game journalism scrum when the “AAA” designation was first gaining steam. He eventually rose to the position of GameSpot’s Editor-In-Chief before leaving to pursue his dream of developing games, which includes two critically acclaimed titles for Supergiant: Bastion and the upcoming Transistor.

According to Kasavin, it was still rare to hear about “AAA” games into the 2000s and the phrase was much more popular on the development side of things:

“I don’t quite recall when I first heard the phrase ‘AAA game.’ I joined Electronic Arts to work on Command & Conquer [in 2007], and I feel like I first heard the phrase around that time.”

Kasavin was unable to pinpoint the exact game the “AAA” designation was used to describe in 2007, but today he feels that the phrase refers more to the game’s price tag than as any indicator of quality: “I think ‘AAA game’ has more recently become sort of a short-hand for almost any boxed console game retailing for US $59. Arguably it is an aesthetic.”

As one of the few “megapublishers,” Electronic Arts deals almost exclusively in “AAA” games. And their Chief Creative Director, Richard Hilleman, believes that the resources to create those titles are consolidated within just 25 studios throughout the world. This number comes from his participation in D.I.C.E. (Design, Innovate, Communicate, Entertain) Europe’s recent whitepaper on Video Game Intelligence:

“What is true today is that there are fewer AAA games being built than at the same point in the previous generation. I’ve done some calculations that say there were about 125 teams in the industry worldwide working on what I’d call a AAA game on a console, and that was [seven] or [eight] years ago. That number today is well south of 30; probably in the 25 range. What’s interesting is that, if you look at the composition of those teams, the numbers are exactly the same: those 125 teams became 25; the size of the teams increased by a factor of [five].”

Even though the “AAA” game is a nebulous concept throughout most of the game industry, Hilleman’s assertion doesn’t make much sense. EA alone operates more than 25 development teams and an argument could be made that at least eight of them qualify as “AAA” console developers: BioWare (Mass Effect 3), Criterion/Ghost Games (Need For Speed: Rivals), Digital Illusions CE (Battlefield 4), DICE LA (Star Wars: Battlefront), EA Canada (FIFA/NHL), EA Montreal (Army of Two), EA Tiburon (Madden/Tiger Woods), and Visceral Games (Dead Space 3).

Even the developers themselves have problems differentiating between “AAA” titles and other, lesser tiers. Last year, OXM UK asked several developers (from companies as diverse as Volition, Valve, and Splash Damage) to describe a “AAA” game. None of them were confident that their definition of a “AAA” game was the right one and a few bypassed any serious contemplation of the question and went straight for a joke.

On that note, some publishers have moved on to promoting “AAAA” games, as they clearly aren’t content with creating something as pedestrian as a “AAA” game. Microsoft’s Black Tusk Studios went for the quadruple in late 2012 when they began hiring for their first project, an untitled shooter that they claim could be “the next Halo.” As of this writing, they’ve retired the “AAAA” descriptor from their Careers page, but Black Tusk did release an interesting teaser of their first project during this year’s E3 Expo. Even though the game will be Black Tusk’s first, using Kasavin’s definition, it certainly matches the aesthetic you’d expect from a “AAA” title due to its highly cinematic presentation.

Are “AAA” Games In Trouble?
While the game industry can’t seem to codify what a “AAA” game is, they all have an opinion on the health of the “AAA” game. Richard Hilleman believes that the number of “AAA” studios is shrinking while the number of people producing “AAA” content stays roughly the same size. Meanwhile, the guru of Gears of War, Cliff Bleszinski, believes that rising costs for “AAA” projects will eventually lead to the death of the used game. Bleszinski thinks that Microsoft’s attempt to control used games on the Xbox One is proof that the “AAA” development model is broken. Yet, the outspoken developer formerly known as CliffyB is working on his own “AAA” project in secret.

It turns out that you can’t swing a dead bandicoot without hitting a developer who believes that the “AAA” game development sphere is in for a rude awakening. The opinion is shared by many people – from Patrice Desilets (the co-creator of Assassin’s Creed) to Denis Dyack (the creator of Eternal Darkness) to Naughty Dog’s Neil Druckmann to a trio of former “AAA” developers who have escaped to the “indie” scene. They all say the same thing: the budgets for “AAA” games are out of whack with the way the public currently buys games, and that something is bound to change.

But then you’ve got Jade Raymond. The Managing Director of Ubisoft Toronto just completed work on Tom Clancy’s Splinter Cell: Blacklist and is currently overseeing production on five “AAA” games including Watch Dogs, the next Assassin’s Creed game, and three unknown titles. Not to be outdone, Take-Two Interactive operates more than a dozen development houses, and they recently revealed they have ten “next-generation” games in development. Are all of them “AAA” games? Not necessarily. But one of them is most definitely Grand Theft Auto VI, and recent history has shown us that even though GTA games reach for the loftiest “AAA” heights (and have a budget to match), they are still insanely profitable for Take-Two.

Did “Indie” Kill the “Mid-Tier” Star?
With all this talk about massive teams and megapublishers, it’s easy to forget that “AAA” games make up only a fraction of the PC and console games released every week.

The NPD Group has tracked video game sales in North America for years now, and earlier this year, NPD Analyst Liam Callahan said, “[M]iddle-tier games as well as catalog titles are suffering.” However, NPD famously doesn’t track the sales of downloadable games on consoles or the PC. Has the “mid-tier” game simply shifted away from store shelves and onto our hard drives? Personally, I think it has. Ten years ago, games like Bastion or The Behemoth’s BattleBlock Theater would have been released as disc-based games. Calling them “indie” titles isn’t entirely accurate, as Supergiant initially partnered with Warner Bros. to publish Bastion on the Xbox Live Arcade and The Behemoth worked closely with Microsoft to produce BattleBlock Theater. Yet, both teams only number about a dozen people. But their success (and the similar success of Team Meat, Telltale Games, Gaijin Games, Undead Labs, and many others) proves that the walls between the tiers below “AAA” are slowly toppling over.

Thanks to the rise of digital download platforms, the “indie” developer who self-publishes their game and the “mid-tier” developer who partners with an established publisher for their project are slowly coalescing into one group. As Richard Hilleman said, movement of developers between teams is easier than ever before. And with multi-team development on the rise, a “mid-tier” or “indie” developer no longer needs to work on their own projects to stay afloat (just look at Splash Damage’s work on the multiplayer portion of Batman: Arkham Origins).

But please, don’t tell that to all the developers (such as these three guys) who believe the “mid-tier/B” game is dead.

“AAA”: You’re So Hollywood
As much as the game industry loves to (usually incorrectly) compare itself to Hollywood, the tier system is one place where I think it makes a lot of sense. Big movie studio pictures are able to exist alongside the movie you get when a lone nut films his friends goofing off behind a convenience store counter. Some blockbusters become huge hits while others flop. And some smaller movies go on to become just as big through sheer force of will.

The game industry could learn something from this model. In the future, we won’t be talking about the health of the “AAA” game. We’ll be talking about the health of a particular development team or publisher. No one asks if the blockbuster is dead after Disney drops a John Carter on us. And no one should worry that the “AAA” game is doomed after Tomb Raider‘s budget spiraled out of control and Square Enix called it a failure. As Rockstar showed us in September (and Activision surely will tomorrow), “AAA” titles can still be profitable.

The next few years are going to be quite interesting.

This entry was posted in Features, PC, PS3, PS4, Top Story, Wii, Wii U, Xbox 360, Xbox One. Bookmark the permalink.
John Scalzo is Warp Zoned's Editor-In-Chief and resident retro gaming expert. You can follow him on Twitter or email him at john AT warpzoned DOT com.

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