For a game like God of War III, the devs must have looked for movies with a huge sense of scale. Just in the open sequence there are so many set pieces sewn together and it really is awe-inspiring. It's not really a game that's more of a movie, just that the presentation borrows concepts of grandeur from film.
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Why watching movies is a necessity for games
If you want to turn your games into movies, then sure. But other than to serve as source of inspiration, no, watching movies is not important to making games.
It's not required. Movies, games, comics, novels, et. al. require you to read books, know the makeup of stories (beginning, middle, end, climax, build up, etc.), and be good at writing if you are on the story side of it. Graphically, you can pay homage or nod to a movie by making a scene similar, but again it's not required as it can, potentially, limit your imagination by focusing on what you saw in a movie. Programming doesn't require it at all, but I do see programmers say to play a lot of games and think of them in a programming stance as to how they might have achieved the feature or effect in the game. Sound effects and music are also more about creativity based on knowing basics of music so I would say it is less about watching movies and more about listening to scores from movies and sound effects from movies then trying to emulate pieces you like before trying to modify it to your preference or preferred style.
I'm just going to plain disagree that the source of all inspiration has to be books. Especially if you're claiming that everything story-related derives from classic stories. Yeh, reading is a good source for inspiration or reference, but they aren't superior to anything else. It's just one of a whole bunch of ways to get a story across. In that same vein, there's no need to say that movies HAVE to be the source for game visuals. If it's your goal to simulate the cinematic experience, then sure, use movies as your reference - but games are not movies, nor do they have to be similar to them.
I keep seeing threads pop up along the lines of "if you make games you MUST also do this! You must read books! You must watch movies! You must study 'the classics' of everything!" No, you don't have to. I instead propose that basing every new piece of media on "the classics" of everything just runs us around in circles. We don't need to tell the same stories in the same way over and over again. Do something else. It's fine to be original - draw inspiration from something entirely outside of media if you want to. Sure, maybe it means you'll end up reinventing the wheel - but maybe you'll do something nobody would have thought of at all had they constrained themselves to emulating other media. Study those things if you really want to - and yeah, there's benefits to it, things to be learned - but it's not a requirement by any stretch.
Lets take a look at two very successful games...you might have heard of them...
Resident Evil. Some one at Capcom loved the old Zombie movies of George Romero, and so you had the basic theme of the game; Zombies, classic b-movie monsters such as giant spiders and snakes thrown in for good measure. The lack of music in some sections adds an errie atmosphere to the game - even with hilariously diabolical dialogue. But all that is only second to the game itself - an improved Alone In The Dark. I can only assume someone had played AITD and loved the basic gist of it, but wanted to make a few adjustments.
Tetris. Inspired by a physical, classic children's block game? I don't think it has anything to do with a film in the slightest, but in some versions theres images of really hip mushroom buildings you'll find in Russia. Dunno if those were in the original version of the game, though. The point is, the gentleman who made the game, looked to something in the real world - not the silver screen. Possibly more successful than Resident Evil...
So, no, an interest in film is not required to make a game. By playing other games you get a feel for what games you enjoy playing and those you enjoy developing. You also get experience of what you absolutely hate about playing games - no matter how they are dressed up. That said, theres certainly no harm in looking to a film to make your game cooler...
Top Gun. After Burner. Nuff said!
The answers here are a bit of a knee jerk reaction. Inspiration lies everywhere. Watching films can help you, but knowing more about cinema as opposed to less about cinema will help you more. If you know about as much as the average IMDB user, then you're not going to have a leg up on your competition. As an example, The Shawshank Redemption is not the greatest film ever made among those who know cinema, although IMDB might have you believe The Shawshank Redemption is the greatest film ever made. The reason The Shawshank Redemption ranks as number one on IMDB is because it polls the cinematically illiterate as well as the literate.
If you step outside the boundaries of the cinema you're familiar with, and really start to explore cinema, a discovery process begins. And learning begins. When learning occurs, ideas are generated. Never shrug off opportunities to let ideas form that wouldn't have formed otherwise.
In short, watching great cinema can give you a leg up over your competitors. Choose as you will.
There’s a wonderful quote from Terry Pratchett about being a good writer.
“So, instead, I give tips on how to be a professional boxer. A good diet is essential, of course, as is a daily regime of exercise. Pay attention to your footwork, it will often get you into trouble. Go down to the gym every day – every day of your life that finds you waking up capable of standing. Take every opportunity to watch a good professional fight. In fact watch as many bouts as you can, because you can even learn something from the fighters who get it wrong. Don’t listen to what they say, watch what they do. And don’t forget the diet and the exercise and the roadwork.
Got it? Well, becoming a writer is basically exactly the same thing, except that it isn’t about boxing”
And being an artist/programmer/level designer/whatever is exactly the same thing except it isn’t about writing.
If you want to create something, look at what others have created before you. Good, bad, you can still learn from it. Don’t be restricted by genre or even medium.
So yeah, watch movies (and tv shows too). Read books (and comics!). Listen to all kinds of music. Play games (board games too); if you can study the source code, even better
Unless you are spending more time watching than creating, immersing your self in art can only help you.
One thing I would say is that if you can get influences from any medium (games, movies, books, music, etc.) but I wouldn't say it was mandatory.
I do believe that looking at other creative mediums broadens your mindset about how you approach games.
Maybe you are interested in instilling a deep sense of doom and dread into your game. Maybe you love the idea of scaring gamers. So the natural course of action would be to just play games that fit that mold (Amnesia, Silent Hill, etc) but why not expand to other mediums like movies for inspiration. You never know what a movie like "The Conjuring" could teach you about building suspense and how to use jump scares in a new a different way.
All of a sudden your games have a different depth and feel even fullerl and maybe can even reach more audiences who may be looking for something "different".
There is so much to learn from every field. I would say don't burden yourself by feeling you have to watch a 100 movies just to feel like an adequate game designer. I would just encourage you to be a student of all things. Watch what makes people happy, what makes people sad, what makes them laugh, and what makes what people feel.
Distill that into your games and love what you do!
I would have to say yes for a few reasons, as now the game industry has surpassed the movie industry in profits (not sure now in today time ) and are given big budgets (sometimes) to make the game epic, everything from sound to graphics, and if the game is going to mimic a movie the yes it would be beneficial to watch to get reference material and possibly cut scenes from the movie. But if not then I would have to say no, the format of your game could be completely different from any movie.