Eric Johnson

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The Toy Story at E3: Why Videogame Makers Are Also Pushing Physical Toys This Year

photo 2 (2)In theory, E3 is about the virtual stuff: The games and gaming-related services that, together with occasional new hardware, define “next-gen.” But this year, a seemingly last-gen — or maybe last-century — interest in physical toys and action figures has bubbled up in parallel with some of the hot new software.

Companies’ stated reasons for this renewed interest in physical toys for games are all over the map. But it’s impossible to begin without addressing the commercial success of Activision, which is prepping a new entry in its toy-game hybrid series Skylanders. To date, the company has reportedly grossed more than $1 billion since 2011 from that family-friendly franchise.

How does a kids’ game do so well? By selling add-on toys to the initial virtual experience. To see every last bit of last year’s Skylanders: Giants, you’ll need to spend something like $125. Those toys have RFID chips so that the game “knows” just what it’s able to unlock for you, and what’s still off limits until a trip to the First National Bank of Mom and Dad (not a member, FDIC).

Disney is getting ready to release its own game, Disney Infinity, which brings together characters from multiple Disney franchises and seems inspired in equal parts by Skylanders and Minecraft. If you put toys of, say, Jack Sparrow and Buzz Lightyear together on some included figurine-reading hardware, then Jack and Buzz will appear side by side in a “Toy Box” mode that lets players play inside an infinite, franchise-bending world.

John Blackburn, CEO of Disney-owned Avalanche Software, said that although comparisons to Skylanders come early and often, work on Disney Infinity began in 2010, “before I’d even heard of Skylanders.” Activision’s first game in the series, Skylanders: Spyro’s Adventure, came out in 2011.

sulley buzz disney infinityHowever, Blackburn added that physical figurines were not always part of the plan. The idea of creatively mashing up different Disney universes was in the original pitch, he said, but Pixar/Disney Animation CCO John Lasseter was the first person to suggest real toys. According to Blackburn, Lasseter — himself a toy collector — also rejected the initial idea of differently sized and styled toys.

“I want to be able to put these [toys from the game] on my shelf side by side,” Blackburn paraphrased Lasseter as saying.

As a result, live-action characters like Tonto from “The Lone Ranger” got more cartoony, while the giant furry Sulley from “Monsters, Inc.” and “Monsters University” was shrunk and smoothed down.

With both Skylanders and Disney Infinity, the idea is that players are willing to pony up for new figurines because they carry both physical and virtual value. So, a collector like Lasseter who doesn’t play games might still want to get all the Infinity toys, which Disney plans to roll out in new packs in the coming months and years.

Rolling in the opposite direction is Lionel Trains, maker of model railroad toys. The company says old people — er, sorry, consumers of an advanced age — know the Lionel name well, but that starting under age 30, brand awareness drops precipitously. So, Lionel came to E3 with an iOS game, Battle Train, which is aimed in part at encouraging the younger set to want to buy the real thing.

photo 1 (1)A much quieter example of the trend is Swappz Interactive, which is prepping physical-virtual hybrid toys that work in tandem with mobile games. The one-year-old Toronto-based company is planning to launch a line of figurines this summer that, when scanned by a phone’s camera, unlock new characters in games based on the Teenage Mutant Ninja Turtles, Smurfs and Power Rangers.

Swappz CEO Bobby Stewart said the idea for Swappz arose from a glut of low-quality games made to accompany physical toy franchises. His hope is that a toy of Leonardo from the latest incarnation of TMNT on Nickelodeon is more enticing when it can be scanned to deploy Leo into a game that’s actually fun.

“Kids today are so different than they were 10 years ago,” Stewart said. Show them a toy that’s just a toy, he added, and a common reaction is, “So what?”

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik