Y Control: Joe Ybarra On Cheyenne Mountain's Massive Plans

With years of industry experience stretching back to the earliest days of Electronic Arts, and other pioneering studios - he's produced games including The Bard’s Tale, M.U.L.E., Starflight and Wasteland, Joe Ybarra has seen a lot of trends come and go.

Ybarra also has produced MMOs including Shadowbane and The Matrix Online, and has been working with Arizona-headquartered developer Cheyenne Mountain Entertainment as its SVP of strategic operations. There, he's tackling turning the Stargate license into a successful MMO as Stargate Worlds, as well as working with multiple other divisions of the developer, including Handcranked Games and Superstition Studios.

In this in-depth Gamasutra interview, Ybarra, talks the challenges that this presents, and the state of the MMO business, including details on the company's second, as yet unannounced title.

I'm slightly unclear on how the company got started. Were the internal studios all hired completely from scratch, or did you annex existing teams?

Joe Ybarra: Well, yeah, the short version is: Yes, we built everything from scratch. And I'm trying to think now if there's an exception to that statement. I guess not, because we did pursue the possibility of an acquisition at one point, but for whatever reason, that didn't come through. So, we pretty much built the studio from scratch.

We started the company in July of 2005, and the company was basically started by a group of people that had a relationship with MGM, three years prior to 2005, for the rights to get the online versions of Stargate. And it took them about three years to find Gary Whiting, who is the chairman of our company, and our primary fund raiser. And so he thought, "Well, gee, this sounds like a really interesting idea, trying to do an MMO based on the science fiction TV show."

So I was recruited and brought on as employee number one, the start of the start of the whole studio process. And over the course of the next year, year and a half, we built up the first studio, which is Stargate Worlds Studio, and then -- as I mentioned -- about a year and a half later, we started up studio number two, which was at the time headed -- and still is, actually -- by Rod Nakamoto, who's our VP of product development. So, now we're a year and a half in the process, so over the next year, we proceeded to build two more studios. So we have four now, one of which is located in Boston.

It's kind of... I don't know if "insane" is the right word, but uh, to start a whole bunch of studios before having released anything. Maybe ambitious is the word.

JY: Yeah, there are several different adjectives that you could use to describe that. Yeah. (laughter)

I mean there's so much, and so many people riding on the idea that this license will work, right?

JY: Yes and no. I guess, yeah, the fundamental answer is: of course. We have a lot of investors, because our company has all been privately funded with a range of investors, and of course our job is to make sure that they make a lot of money out of this process.

So, Stargate is actually, of course, our first product, and it's the one that's the most visible product, but if you look at what it takes to be a real player in our industry, part of what's made the better companies successful is the fact that they have scale.

Quite a bit of that is, if you have a project like Stargate, and you have probably a large team working on it, and the project ships, what do you do with all these people, regardless of whether it's successful or not? So, typically speaking, if you have a one-product company, that means that a lot of people are either laid off, or they have nothing to do until you've completed a pre-production.

When you have multiple studios, it gives us the ability to shift people and resources around, to get better leverage over what we have. So, to that extent, it's a good idea. As far as the quantity is concerned, a lot of that goes back to the investment strategy of the company, for the investors to get the return on the investment that they'd like.

You know, we really have to have more than one product, and given that these products take a very long time to build, you're looking at five year plan for us to deliver enough product and enough content to the audiences. We really do have to have several projects going on, and that's kind of what fuels the expansion of our organization.

How do you determine who should be hired, in that case? Because I haven't really heard of a lot of cases of hiring this massively, and company culture is really important, as far as any studio. If you're completely building it from scratch, how do you decide who to hire, and what the company culture is going to be?

JY: It begins with hiring the senior management team. When we initially started the company, of course the focus was on building the first studio, so the first wave of hires was the directors of the project. Our technical lead, our technical director, our head of the studio, et cetera. So, you just have to be patient, and you have to be willing to interview a lot of people.

And there are characteristics that I personally look for, in individuals that I want to bring onboard as managers, as leaders of our company. Like you said, part of our culture, if you will, is making sure you identify people that have the same belief system that you do; the same kind of ideas about things, and so on, and so forth.

But you also want to get a little bit of diversity into that as well. In our particular case, one of the things that I really looked for was experience. All of our folks, at least at director level, have at least ten years of experience in the industry. And because they come from many different companies -- we probably have somebody from just about every company that has ever built computer games -- that we get this diversity of viewpoint about how things get done, and, you know, certain values.

So, to go back to the culture question, a lot of what we have to do is just make sure that everybody's communicating with each other; they get on the same page about what we're trying to do. And it's working! I think that we have a really good culture. I like the culture of our company -- in the sense that we have enough diversity, as well as enough commonality, that it all works.

That's good. And there are multiple products coming out, right? On multiple platforms, eventually, with the Stargate license. Are you planning things other than Stargate, too?

JY: In terms of other product lines, you mean?

Yeah.

JY: Yes. In fact, Stargate, as an MMO, is the only large scale MMO that we are working on. We have another MMO that's under construction that's considerably less in scope, but nonetheless is still in that space.

But, another answer to your question is that all of our products will have online as their primary mechanism for delivery. And, in that regard, we don't focus entirely on MMOs. In fact, our second product is a completely different kind of a product. It's more of a peer-to-peer kind of an online activity. It's possible, like Stargate, that we can put it on console as well. But our primary focus is on the PC, and delivering online game experiences. All four of our studios build products in that space.

Have you thought much about the 'free to play' model, and what kind of business model are you going to go for?

JY: Yes, we have put a lot of thought into that. Yeah. And, it's my personal belief that it is ultimately where all the products go. Free-to-play, microtransaction business model, I think, is the winning solution, long-term.

I was actually talking to Min Kim -- did you see the Visual Fight Club thing that happened?

JY: No, I did not.

It was just him versus Kelly Flock, and they were talking about subscription model versus free-to-play model, but when I was talking to Min earlier today, he said that a lot of people seem to have really the wrong idea about what the free-to-play model is. The game is really a service, not a product. It's like, you're facilitating contact, and the game has to be built from the ground up for item sales. You can't just make a game and then put item sales into it afterward and expect that it's going to be functional. So is that something that you've been building in from the beginning, or is it more recent?

JY: Well in the case of our second product, which is what we're discussing -- our free-to-play product -- yeah, it's been architected from the ground up to support that activity. And without getting into the content of what this game is -- if I able to explain it to you, it would be obvious that, yeah, this is a really good proposition, or content model, for this type of transaction-based environment. Because some games lend themselves better than others do, and what we think is that in our second product, we've got something that is absolutely perfect for this kind of business model.

And, like you said, all online products, regardless of what they are -- MMOs, or peer-to-peer, or whatever -- have a service component to it, and, as you articulated, it really is a service. We look at Stargate Worlds as the example of that; it's that we're not building a product, we're building a real service organization to our customers. Especially if you're in the subscription-based model, you've got to be more added value to your customer than just shipping up a box and connect up to your service. We've know that from the very beginning. And that's a lot of the effort that I'm personally working on now, at Cheyenne, is building that infrastructure.

Are you mostly focused on getting existing licenses, and putting those appropriately into the game space, or will you develop completely original content?

JY: Actually, by accident more than by planning, it's about half and half. Yeah. And I say that it's an accident only because it's just, basically, a product of opportunity. We get the opportunity, like the Stargate property, to do something that we believe we can do something really good with, then we'll do that. But fundamentally, as a developer, it's in our interest to develop original IP. So we really want to focus in on that as well.

Do you think that you're going to have to partner with a publisher at all, in the case of either of these? I don't know if anything has been announced, but it seems like, with your scale, and digital distribution, it might not be necessary.

JY: Well, it's our intent to basically be the operator of the product, in that we run the service, we do the customer support, and all of the infrastructure that's necessary to do that. So a publishing partner, for us, is somebody that will help us with retail distribution, since Stargate will be a boxed product to go along with the service.

And then the other aspect, that goes back to what you're alluding to with a publisher partnership, is the global scale. You know, we can service a certain portion of the world, but we just can't be everywhere at the same time, because we just don't have the expertise or the scale yet. So, that being said, we're hoping to find partners that will help us in other territories, other than North America. And we'll just see how that works. That's another task that I've been working on now, for some time.

When do you think that digital distribution is going to be the dominant model?

JY: That's a good question. I think there still needs to be several precursors that actually have to be enabled before it becomes dominant. I mean, it's already obviously being practiced.

One of the big ones is high bandwidth connections. Because a lot of the product -- especially something like Stargate, which has really high production values -- the size of this, the footprint of this product is gigantic. So if we're going to distribute this across the internet, we've got to figure out a way to get it into the customer's hands in a reasonable time frame. So I think that's one issue.

I think another issue is the actual visibility and marketing aspect of it; because when you turn on your computer, and want to start figuring out different ways of getting content, how do you find it? There's just so much material out there, that I think there's more evolution that will take place in that area as well. So this is just, basically, how do you get brand? How do you get people to come to destination locations and get content? How do those things compete with each other? So I think that's another problem.

Another hurdle is: How do you address the cultural differences from nation to nation? Because people that purchase products in, say, the Asian territory, will behave differently than Americans, who in turn behave differently than Europeans. So you've got this mixed bag of: how do you address all those market choices?

Yeah, and there are serious logistical issues there, too. Like, in Japan, credit card use is not very common. And on the up-side, in Korea, the internet speeds are completely not regulated, so you can have blazing high speed connections there. So it's really quite -- yeah, it wouldn't be simple.

JY: No it wouldn't. No it would not. (laughter)

So if you do any console type stuff, if online it's a prerequisite for your games, how would you be able to tackle the handhelds, which have much more limited online capability?

JY: From my perspective, I think the problem is more of a business and a relationship problem than it is a technology or content problem. If you look at the way, as you just described, Nintendo works, is different from the way Microsoft works with Xbox, which is different from the way Sony works with PS.

From a business standpoint, the deal-making, the infrastructure that they supply, the rights that they're willing to let you have, the profit margins that are available, et cetera. I think that's the biggest hurdle we have, because we can completely build the products for these platforms, and we can completely build a product to fit the needs of these customers, but trying to make money at it is the next trick.

Yeah, it's true. And especially when the online infrastructure is not very streamlined. Like, again, when I was talking to Min, one of the major things: how do you put money in the game?

Like, through a console, what is the interface for spending money in the game? And that is an issue that some console makers are better equipped to handle than others. I wonder if that's going to be a big factor for online console games, going forward.

JY: It certainly is. I think there are additional hurdles there, too, because in addition to just capturing the revenue -- which is what you're articulating -- how do you protect kids from spending money when they shouldn't be?

Again, it goes back to the visibility. How do you convince somebody that has a lot of choices on Xbox Live that your product would be the one that they play, versus something else, and so on? I guess the point of this conversation is, we've got a ways to go here before we figure all this stuff out.

Right, yeah. There's a lot of that that I've been thinking about. There's been some talk about the potential for a single console instead of the fractured environment that we have now, and it seems like it would be very difficult to make yourself known withing the existing models that we have.

If everyone is competing in the same space -- and you see it on a small scale, like Xbox Live -- it's really hard to see what can rise to the top, and to make your product known, if you can't do it directly in the service itself. So, yeah, I've been thinking about it for a while.

JY: You know, we have a model already that exists, that works: It's about brand. And the model that I'm articulating is Blizzard. You know, Blizzard has achieved, over a long period of time, a consistency of performance.

Every time they produce a product, the customers now have an expectation for a quality level... and they've been consistent about it. They deliver every time. So after a decade of doing this, now if Blizzard were to say, "Now I'm going to put a game up," in anybody's faces, they have enough brand recognition that people would be willing to try.

The problem with a company like us is, you know, they achieve that goal over a long period of time. We're just getting started, so I'm thinking, "Oh my God, is it going to take me ten years to establish a brand that everybody really believes in, and wants to use the products on?" And maybe it will.

I think that that's one of the ways that you overcome this issue. You know, there are other ways to do it as well, but as far as a model is concerned, we look at what they've accomplished, and said, "Wow, it would be really great if we could do that, too."

Right. Well, someone mentioned recently, and it really struck me as true, is that all of the really big blockbuster games -- not just in terms of sales, but in terms of success of execution -- were really late. They were released way after they were planned to be released.

JY: You have to put some thought into that, but I can see that argument.

You know, or at least they took a really long time. Like, Half-Life 2, BioShock, Portal, Halo 3, World of Warcraft, StarCraft II; all these games have had extremely long cycles, and they were released when they were done. It seems like that's the space that people need to get to, but it's really tough because, you know, they've got to meet ship dates and things like that.

JY: Yeah. Plus they're damned expensive.

Yeah. (laughter)

JY: Yeah. So you have that problem, too. And I think you're right. I think the issue is, is that, the longer the project duration is, the harder it is to predict when it's going to be done. That's pretty logical. And, along the course of the way -- what I've seen in my own personal experience is that you get products of opportunity while you're constructing your product.

So, you know, you start off with one design principle, you go off and you start building it, and then you realize it either doesn't work, or, "Oh, by the way, this works so well that if we were to adjust it this way, it gets even better." So these are what I call "the products of opportunity". And, of course, all that does is it elongates your project when you start running into that kind of thing.

And then, you know, I think there is a scope issue. There certainly is a scope issue with MMOs. How much product do you build? With an MMO, first of all, you never stop building in an MMO to begin with, right? So you kind of have an arbitrary finish line, right?

So we have critical mass of content, it all runs, everybody's having a good time, we can launch --knowing that I'm going to continue to add more content over time. So, you know, you have that issue as well, the considerable elongation of the project cycle.

I don't know, I think a lot of it comes down to, one of the issues we have as an industry is the fact that every time we go to build a product, the technology is different. Especially when you have a three year development cycle; that encompasses the entire lifetime of a console environment. So it's sort of like you're almost doomed by the time you're finished, and wherever you go next is going to be completely different. So, that doesn't help anything either.

There are a lot of issues that we need to overcome here, and I think it's all of those factors. And then there's one more that I think is kind of interesting, and that is: some of the more successful products that we've seen in the history of our industry are really right on the edge of being inventions.

Like, before Doom, there were no first person shooters. So when they're designing a product like that, we've never seen one before, so how do you predict when you're going to be done?

Yeah, it's definitely true. And I think it's unfortunate that not enough people are doing it, really. I feel there's a slight lack of invention, because there's a lot of me-too-ism once something does get popular.

JY: Yeah, I think that's probably pretty normal, though. You look at all media. Media tends to be like that in general.

It's just a shame.

JY: It is a shame, and it's a shame in our case because of the scope of what we build. It takes so long to build these things, and they're so expensive, that yeah, you're right, in the sense that it would sure be nice if we could do more innovation, but, you know, you look at the business issues that go along with the marketplace issues, and so on.

Another factor that's interesting about our business is that if you have three years to build a product, what you think is going to be successful when you start may not be what's successful when you're done. Because it takes so long, and audience's tastes change, and other competitive products come out, and various other factors come into the equation. So that only makes things worse too. So, it's really a crapshoot.

It's true. Back to what you were saying about branding stuff, I was wondering what -- I mean, it's kind of a silly question, but the name of the company doesn't sound like a game developer to me. So, what was the decision about that?

JY: Why are we called Cheyenne Mountain? Well, originally when we started the company, we thought our sole and exclusive mission in life was to build Stargate Worlds. And, because of that, if you watch the television series, the Stargate Command is actually located in the Cheyenne Mountain. It's a military facility there.

So our original founders came up with the idea of calling it Cheyenne Mountain -- when they first started looking for funding, and everything else. This is years before I joined the company. So it's sort of the path of least resistance, actually. They were calling it Cheyenne Mountain. I was like, "There's nothing wrong with that name; it works for me." And, over time, it just kind of stuck.

Having said all that, our marketing team now is in the process of re-evaluating that, and we're contemplating coming up with a different name for our company. Because we've always been into brand recognition, and establishing a brand. And one of the problems we have to wrestle to the ground is, what brand do we want to be known for?

Because obviously, when we launch Stargate Worlds, we have this relationship with MGM, and with the TV show, and our own company, and all these other things that kind of mix together.

So we're trying to figure out a way to really identify who we are as a company, but at the same time start establishing in consumers' minds what our brand is, and what it stands for.