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He says when they started, like a lot of companies, they had no idea what they were doing or how to make it work. "We shipped a game, we got great reviews and sold tons of copies, and [things] couldn't have been better," he said. "Then we stumbled ... and had to rebound off of that.
"One of the things we learned after trial and error over five years was: Don't ruin a brand to get more games. ... Don't sign a kids' title and ship under the name Vicious Cycle, which is what we did with Dynotopia. Big mistake. ... We want everything that's under VC to be hardcore and niche, whereas the family stuff is Dora, Flushed Away and Curious George. ... That was a lesson [we] learned over time." They eventually formed Monkey Bar as a spin-off for their family games, in order to preserve Vicious Cycle's hardcore image.
I asked him how a company like Vicious Cycle survived long enough to learn and implement those lessons.
"There's luck involved," he said. "I would be a liar if I didn't say there was luck involved. We're [also] really doing a good job of making the corporate culture good, so people want to stay here ... and [of] having [good] business relationships. If you're a go-to guy with a publisher, that's a good place to be.
"That's another mistake that people out in the industry make [is they] work on a demo and piddle away savings they've made over years. When we were at MicroProse, we had a lot of times, like months, when we didn't have anything to do. And that's a dangerous place to be. That's when studios close.
"It's better to be busy than scrounging for work or wondering what to do. As a developer, that's the worst place to be is wondering what I'm working on next. So we try to take that out of the equation here at Vicious."
Peterson says the key is knowing where you are in the lifespan of a hardware platform, and knowing how you, as a developer, can work within that. "When the hardware curve has already started, and you don't have an engine, it's hard to jump in midstream and be competitive in two years," he says, "which means you're gong to spend a year, minimum, building that engine. And we've been there as developers and know how much time that detracts from building the game.
"There's still a lot of potentially new PS2 developers on the market. All of the old developers have moved to the Xbox 360 and PS3, and there's no one to fill the void for the PS2 games that need to be made over the next three years. ... They're going to have to look for something that's on the market that already exists ... without starting from scratch.
"We're the 70 percent solution of the market. We don't have to be just sports like EA, in the sense that that's their bread and butter, or id's bread an butter is shooters. We looked at the other 70-80 percent of the pie that we could make work for us."
He said their engine and their willingness to work with the aging "old-gen" platforms, while simultaneously developing a new iteration of the Vicious Engine for the next generation, puts them in a "sweet spot." But they aren't looking to get out of actually making games just yet.