You can't usually expect to sell an odd, unconventional idea to a load of people. In reply to Interesting games are often niche though unless they get lucky and recieve the hype train Braid and World of Goo did. It was really insightful, but I can't find it anymore. Michel Ancel did an interview with Gamespot once talking about this very thing, balancing the sensation of power within a game. Resident Evil 3's Nemesis wasn't scary because he looked scary or realistic or whatever, he was scary because of how he was presented and how the player was haunted by him. For me, a breathtaking DS game manages to be breathtaking even though it exists alongside Killzone and Gears of War, and whether a game is fun, suspenseful, exciting, scary, all comes down to its ability to manipulate how the player feels through gameplay. I FEEL like we've gotten to a point where all platforms work fine if worked on with a good sense of their quirks and limitations, but maybe it's just that I'm older and don't give a crap about that stuff anymore. I honestly don't even get the graphics thing anymore. Quite a few projects are slowly coming to frutition on the Wii, things that aren't quite XBLA material but also wouldn't realistically be able to compete with HD blockbusters. In retrospect the PS2 has really been the one to step up to that plate so far, but things are arguably beginning to shake loose now however. I've been hoping for that kind of evolution in gaming aswell and when I heard about Nintendo's plan I was sure the Wii would be it. I realise that there is room and even a need for progress in terms of graphics, but you can't expect the Eternal Sunshines of gaming to get the Transformers 2 treatment. Movies follow the same truth, Eternal Sunshine doesn't have the budget of Transformers 2. The result is you have to spend more resources on graphics to even be a viable product in people's eyes, inflating the dev costs and running a bigger risk of not profiting from the game unless you can sell it to a bigger audience. If you develop for better hardware people expect more from the graphics. I agree with what you are saying, but in being right you're also furthering the point. Fatal Frame 4 is on the Wii for that very reason, the genre just doesn't really justify the HD graphics/sound investment these days, and a lot of genres are the same unless you've already built quite the legacy. There are essentially two franchises that have survived in some shape or form - RE and Silent Hill - and RE is pretty much an action game these days. Interesting games are often niche though unless they get lucky and recieve the hype train Braid and World of Goo did.
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