Plenty has changed already — as if the power of YouTube as marketing channel weren’t already very evident, we also have the new Steam curation system coming into play. And the fact that the practice of paying for YouTuber videos is alive and well, with costs from $500 on up for a review, is sure to come up. I note that there are not one, not two, but three sessions on indie game economics at Indiecade, so this is clearly all on people’s minds.
It’ll be on Sunday the 12th at 1:30 in the Ivy Theater. Hope to see you there!
I’ve been thinking a lot lately about the financial future of developers.
The supply chain for creative work
To go back a ways, back in 2006 I suggested that you could look at the winding path a piece of media takes to the public in this way:
A funder of some sort ponies up the money so that a creative can eat while they work. Sometimes this is self-funding, sometimes it’s an advance, sometimes it’s patronage.
A creator actually makes the artwork.
An editor serves the role of gatekeeper and quality check, deciding what makes it further up the ladder. They serve in a curatorial role not just for the sake of gatekeeping but also to keep the overall market from being impossible to navigate, and to maximize the revenue from a given work.
A publisher disseminates the work to the market under their name. A lot of folks might think this role doesn’t matter, but there are huge economies of scale in aggregating work; there’s boring tax. legal, and business reasons to do it; it serves brand identity, making the work easier, to market…
Marketing channels make it possible for the artwork to be seen by the public: reviews, trade magazines, ads. This is how the public finds out something even exists.
Distributors actually convey the work to the store’s hands. This role functions in the background, but it’s absolutely critical. There’s a lot of infrastructure required.
Stores then retail the packaged form of the artwork to the end customer. Stores have their own branding task, and likely serve as a curatorial and recommendation engine all over again, this time trying to find the right fit for the customer.
The audience then gets to experience the work.
Re-users then take the creation and restart the process in alternate forms; adaptations to movies, audiobooks, classic game packages, what have you.
Hello Mr. Koster, my name is J___ A_____ and I am a recent college graduate with a computer science degree. I came across your name on the Wikipedia article about MUDs, and noticed the link to your website and in turn this contact form. I realize this is a complete shot in the dark but I’ve gotten so many friendly “no thank you” letters recently I figure the worst that happens is you never reply.
In 1993, I began playing a hack and slash Rom 2.3 mud called Creeping Death, and completely fell in love. In 1999 I taught myself C and with the help of a friend, we put up our first MUD. I have been actively coding them off and on ever since. A few years ago I went back to school and pursued a Bachelors in Comp Sci and am desperately trying to break into the video game industry. Outside of mud coding I have little expertise in game design. My question then is this:
My talk was complex. I just watched it, and honestly did not remember it all; how it came together linking railroad yards, the first major copyright case, Kenyan mobile phone companies, Wagnerian opera, text muds, shipping containers, molecular biology, microtransactions, and of course, the future of games. But yeah, it hit on all that and more.
It still feels rather relevant today, even if my ending on Metaplace doesn’t. In many ways, what I was talking about has come true via indie games, Unity, Twine, Gamemaker, and countless other “banjos.” In fact, I am particularly hopeful that it will be watched by those who see me as a ludological fundamentalist or representative of “the old guard” or whatever, as there is a moment in there where I jeer at Game Informer magazine for the ludicrous term “impostor games” they used for games that were not challenge-based. FWIW, I also bluntly call MMOs colonialist and racist at one point.
Connectivity keeps getting better, which softens the blow for consumers.
Developers find the sweet spot between “always on” and “phone home when you can” that mobile games have already had to solve (because bandwidth and connectivity for mobile are far more erratic).
Metrics usage explores in the single-player market, to match what is seen in Facebook and mobile.
Yes, this means, with all the good and bad that brings to the table. The fact is that publishers simply won’t be able to resist it. When used right, it makes for better games. And even when used wrong, it generally adds to the bottom line.
Single-player games will continue to evolve towards being services.
Ongoing updates, because again, as seen on mobile, publishers won’t be able to resist the loyalty factor, the boost in retention, the revenue from re-acquisition… in the presence of things like charts showing popularity of games or top grossing games, there’s huge value in doing this even for games that don’t have ongoing revenue streams.
For games that do (be they sub, DLC, or microtransactions), it’s of course a no-brainer.
Really, the single-player model did this already, just without connectivity. Always on just makes it cheaper and better.
Basically, we will continue the march towards “everything you used to buy, you now rent as a service.” With all the good and bad that entails.
Gamers may protest now, but if I may draw an analogy: when they came for your music collections (Pandora! Rhapsody!), you did not complain. When they came for your DVD collections (Netflix! Hulu!), you did not complain. When they came for your office documents (Google Docs! Adobe Creative Cloud!), you did not complain. Now they are coming for your games (Steam! You love Steam, don’t you?), and no one is left to complain on your behalf. 🙂
Don’t get me wrong, though. I keenly feel the drawbacks. As an example — as someone who cares deeply about the history of our medium, I shudder to think what happens to preservation efforts for games from this time period. We’re not going to be able to emulate things without reverse engineering dead server apps — which will mean reverse engineering every rule and bug.
Or another — we’re used to platforms obsolescing away the ability to play a given game. But when business realities mean shutting down a server as soon as the opportunity cost makes it not as profitable as doing something else, we’re going to feel like even single-player games have gotten to feel a lot like that TV show we loved that wasn’t allowed to finish out a full season and left us on a cliffhanger.
But for any business owner, the advantages greatly outweigh the disadvantages. Even with the issues SimCity has had, I am sure that right now the takeaway within EA is not “don’t do this” but “do it better.” The fact of the matter is that running a service seems to be one of those things that you have to learn by doing, stumbling along the way, and it’s a big adjustment for any organization that has been used to retail-style sales.
And the fact is that if it works seamlessly, customers will start to say “I like my Games On Demand” and sign up willingly.
It may be that at some point we see a swing back from the cloud — if the power on our devices exceeds that available in the cloud (if this happens, it likely will be due to bandwidth, not CPU cycles). But I don’t see that changing in the near future.
Instead, we’ll see disconnected games using their disconnected nature as a selling point, at first in contrast to the rocky services and later on as a premium offering for hardcore folks who want to keep going after the game is sunset.
Am I crazy about this scenario, all things considered? No. It has many pitfalls, and some old lessons are getting to be more relevant than ever. But at the same time… I design online games. I’ve been part of the problem the whole time. 😉
Best of luck to the SimCity team with resolving the issues. I’ve been there.