Will Assassin's Creed 4 Be the Last Yearly Update to the Franchise?

Ubisoft's (UBSFF -2.41%) Assassin's Creed 4: Black Flag hit stores at the end of October, and the sixth major chapter in the six-year-old franchise was met with rave reviews. Black Flag not only smartly improves upon the main gameplay mechanics of the series, but it also channels the open sea exploration of the classic Sid Meier's Pirates, encouraging exploration on more levels than its predecessors.

Assassin's Creed 4: Black Flag. Source: Gamefreaks.co.nz

However, the Assassin's Creed franchise is a remarkable achievement on many other levels -- Ubisoft accelerated the series' production cycle by boosting the size of its global development team, and delivered on its promise to release one core (PC or console) title per year. Yet, the game's quality didn't falter -- the franchise still retained gamers, and expanded into an empire of portable and social games, books, comics, and toys.

Let's take a closer look at what made Assassin's Creed a successful franchise, and if it can maintain its momentum.

Making games both fun and smart again
Many people like to call Assassin's Creed Ubisoft's Call of Duty. While the similarities are there -- with the two titles being Ubisoft and Activision Blizzard's (NASDAQ: ATVI) respective core franchises -- the differences are vast. Assassin's Creed is arguably a much smarter game, which wraps its story around actual historical events during the Third Crusade, the Renaissance, and the American Revolution.

It's Ubisoft's attention to historical detail -- particularly in Assassin's Creed 2, which takes place in Renaissance Italy -- that got me hooked on the franchise.

As a history geek who has spent a fair share of time backpacking across Italy, I admired the amount of loving details lavished on the game. Minute historical details -- such as the wooden Rialto Bridge in Venice and the butcher's market at Ponte Vecchio in Florence -- convinced me that the game was a labor of love from its developers.

Ezio using Da Vinci's flying machine to stage an aerial assassination in Assassin's Creed 2. Source: 1up.com

Assassin's Creed's gameplay has also continuously evolved over the years. The original game, which borrowed gameplay elements of Ubisoft's previous hit franchise, Prince of Persia, made rooftop Parkour a free-flowing and enjoyable experience. The second game (along with Brotherhood and Revelations, which are together considered a trilogy) added more weapons and alternate modes of transportation, including Leonardo Da Vinci's flying machine.

In Assassin's Creed 3, the main character was also able to climb trees effortlessly, hunt, and even commandeer a ship on the open waters of the Caribbean -- an idea which Black Flag expanded upon considerably.

Developers, developers, developers...
Ubisoft's ability to push out six main titles and four handheld titles within six years has been impressive. However, there have also been concerns, among gamers and the studio, that this business model might not be sustainable.

The original Assassin's Creed in 2007 cost $20 million to make, and its sequel, Assassin's Creed 2, cost over $24 million. Since then, costs have soared due to the demand for higher quality, "triple A" games to be released on an annual basis. Game worlds are getting larger, graphics are getting more detailed, and production teams have to be increased in size to release a game on time.

Although Ubisoft has not officially disclosed the production and marketing budget for Assassin's Creed 4: Black Flag, the costs are estimated at nearly $100 million -- which means that Ubisoft might have to sell at least 5 million units to break even. In addition to Ubisoft Montreal, Black Flag was developed by seven additional studios for a total of 1,000 employees.

Simply take a look at the following chart to see how rapidly the Assassin's Creed team has grown over the past six years.

Source: Company website.

The bloat has caused concerns
Yet even though the production team size and the budget have risen, the overall length of the main story in these games -- at approximately 20 hours -- has not.

Therefore, additional developers have been brought on board to release the titles before the holiday season every year, and it's a business model that is worrisome, since it will require increasingly disciplined coordination between the teams to launch a cohesive, bug-free title.

Assassin Creed 3's creative director, Alex Hutchinson, told Digital Spy that development costs for next-generation consoles a double-edged sword, stating, " We're at that point where everything that is a plus is also a minus because we have to pay for it." Hutchinson also called triple-A games the "last of the dinosaurs" since the revenue generated by high-budget games might not be able to outweigh their production costs -- a similar problem that Hollywood is now facing with its blockbuster films.

Jade Raymond, the head of Ubisoft Toronto and the producer of the first two games in the series, also noted the unsustainable nature of the triple-A model, which she warned could stifle innovation in the industry. "Anytime you want to make a big triple-A, you're spending, let's say $100 million, you're not going to want to take a chance," she stated.

Are we headed for an industry implosion?
However, spreading out development across several studios could also be advantageous for certain video game publishers.

Valve, for example, has kept gamers waiting for the conclusion to Half-Life 2 ever since Half-Life 2: Episode 2 (2007), which ended on a cliffhanger that was intended to be resolved in Episode 3.

Gamers are still awaiting the final chapter of Half Life 2's intended trilogy of "Episodes". Source: Ign.com.

Unfortunately, Episode 3 never came as Valve got involved in other projects, such as Left 4 Dead and Portal. Valve is now finally coming around with talk of Half-Life 3, but you have to wonder how many Half-Life games would have been produced if Ubisoft, Electronic Arts, or Activision had been handed the franchise.

Dancing on the blade of the double-edged sword
The evolution of Assassin's Creed -- from a single-studio production to a global one -- is representative of the trials and tribulations of the video game industry in general.

Just like the movie industry, the gaming industry faces audiences who demand more life-like graphics, bigger game worlds, and top-notch voice acting -- which can only be satisfied by higher production budgets, and bigger development teams.

Will Black Flag be the last annual update to the series?

Despite these challenges, I don't believe that Black Flag will be the last annual update to the franchise. Production and marketing costs will inevitably climb in future installments, but releasing a new Assassin's Creed title annually will likely remain one of Ubisoft's core strategies going forward.

If Ubisoft can keep delivering high-quality titles as it has over the past six years, it will not only retain its existing fans but also gain new ones. However, gamers should keep an eye on how the company adjusts to the upcoming shift to eighth-generation consoles, which could cause production costs to rise significantly.

If that happens, the future of the series will depend on just how much gamers are willing to pay for the latest annual installment of the Assassin's Creed franchise.