This mere days after we learn that Viacom is buying XFire for $102 million.
Obviously, it’s great to see Chris Kirmse, one of the pioneers of MMORPGs, get his fair share of all the riches that are being earned. (For those who don’t know, the Kirmse brothers were the original Meridian59 guys).
On the other hand, it’s also interesting to see the way in which it’s the ancillary businesses that are piling up the cash offers. I imagine that if IGE were for sale and a little more legit in the eyes of the industry, we might see a lot of money offered for them as well.
Certainly, there’s a lot of money floating around the industry right now. For the first time in ages, there’s venture capitalists funding things that are related to games. There’s deals like these and the one with News Corp buying IGN. The big media conglomerates are paying attention. More and more media licenses are jumping into the fray: Star Trek, Lord of the Rings, Cartoon Network, Stargate…
The thing that is interesting about these two more recent deals is that they speak to virtual worlds as an ecology of businesses rather than as just one business, a subscription service. It’s a sign of maturation that business models premised on the success of the online game services even exist. It’s interesting to ponder what other sorts of ancillary biz models might be viable. The ones that exist so far involve helping people play the game, connecting players, and advertising to them.
What we’re seeing here is the beginnings of online-gaming-as-lifestyle business practices. It’s a mindset of seeing the online gamer as an addressable audience in its own right. Once you adjust to that mindset, you realize that there’s a whole host of things that fit within the online gamer’s lifestyle that offer opportunities for revenue streams. I don’t know how many times I have pitched ideas like giving every ORPG subscriber in your service a free Science Fiction Book Club membership, for example.
The danger is that online gaming, demographically, is still in its infancy in the West, and even in Korea is somewhat underdeveloped. The sooner the market locks in on a psychographic profile, the more likely it is to stick to that. Then it’ll take something really disruptive to break out — and it could be years (or months — you never know).
I mentioned this idea of lifestyle marketing recently on Quarter to Three and by and large, it got a negative response; people don’t like being bucketed up into these segments, even though advertisers and marketers have devised a jillion classification schemes. I think that these purchases are clear signs that, whatever we might think about being labelled (and goodness knows we’ve been labelled all sorts of ways in the past), serious money has concluded that we’re an addressable segment.
Serious money tends to be unimaginative. So now the job falls on us, players and developers, to confound their expectations.