Video Games

MMPORGs, microtransactions, and user experience

Microtransactions within online games and social networks offer one possible way to place a value on services while enhancing the experience for users. In addition to online games like Maple Story, virtual goods are launching all over social-networking sites, including Thursday's launch of PlaySpan's marketplace on Facebook and MySpace.

Funding for virtual worlds has grown dramatically over the last year and companies need to find sustainable revenue models. Transactions of virtual goods allow for new cash flow into both subscription and nonsubscription sites.

But some users don't like the idea that you can simply buy something to affect the game in your favor. Accordingly, games need to be very clear about the purchased goods unfold into the game.

The team at Champions Online have outlined how microtransactions will surface in the game in their State of the Game blog post. … Read more

Funding for iPhone start-ups passes $100 million

Recent data from Chubby Brain identifies $102.49 million in total VC/angel investment divided among 17 iPhone application start-ups.

The iPhone is a great mini-computer and may be the next big gaming platform, but I'm still struggling to get the math to work in terms of what a typical VC expects as their return on investment.

Macworld's App Guide lists more than 58,000 apps available for download with more coming online every day, though it's not clear that downloads are equating to sustained revenue for developers.

But, developing an iPhone application still seems like a good business move, provided you can market effectively and not fall into the boom and bust cycle that many applications find themselves in. … Read more

Games overtake electrical sector in Japan

In a recent newsletter, Gerhard Fasol, head of Eurotechnology Japan, points out that the Japanese games sector is booming--with the combined net annual income of Japan's top nine game companies overtaking the combined net income of Japan's top 19 electrical giants.

Game companies such as Nintendo are thriving through the global recession while stalwarts such as Panasonic and Sony struggle (Sony's diversification and PlayStation sales haven't helped recently) with huge corporate hierarchies and a dearth of new "must have" products.

What's interesting about the growth of Japanese game play is that it'… Read more

'Freemium' beats advertising for online games

Danc at the Lost Garden blog has written up an excellent analysis of why Flash games are great, but represent "the ghetto of the game development industry" in terms of revenue generation.

Compared to the number of players it serves, the Flash game ecosystem makes little money, launches few careers, and sustains few developer owned businesses.

There is too much reliance on advertising and not enough on sustainable paid methods, or "offers" such as subscriptions, in-game consumables, and level un-locking to encourage people to pay--and create an actual business.

There is no need to limit yourself to any single one revenue stream. There are lots of different types of players and each player values something differently. Some players may be willing to buy a t-shirt. Others may want 5 stackable subscriptions. Others may just want a pretty new character with a panda head. When you restrict your game to a single revenue source, you miss out on gaining money from all the different types of customers that would have paid you if you had just given them the right offer.

When gaming communities go wrong

The more time I spend looking at video games--especially online games and MMPORGs--the more and more strange information that comes out. As with any society, norms and oddities appear as individuals assert their place.

There's a fascinating (and somewhat terrifying) article about Loyola University media professor David Myers "unwelcome" behavior in the game City of Heroes, where he created a character that everyone hated.

Players tried everything they could to get rid of the pariah, but he kept at, apparently as research, but there had to be hint of satisfaction in his role as the most hated player--probably right until someone threatened to kill him for real.

Myers revealed his identity and his character's purpose in "Play and Punishment: The Sad and Curious Case of Twixt," an academic paper on his experiment published in 2008.

If we assume that games are their own communities and have some level of self-policing (just like open source projects) we can also assume that these things iron themselves out. In this case the community turned completely against the individual and game-maker NCSoft had to step in to moderate a bit. … Read more

Blizzard chooses cloud over LAN for new game

Blizzard Entertainment has decided to forgo LAN support for the next version of Starcraft II and instead require users to connect to the new Battle.net cloud-based service.

"We don't currently plan to support LAN play with Starcraft II, as we are building Battle.net to be the ideal destination for multiplayer gaming with Starcraft II and future Blizzard Entertainment games," a Blizzard representative said in a statement. "While this was a difficult decision for us, we felt that moving away from LAN play and directing players to our upgraded Battle.net service was the best … Read more

China bans online 'gold farming'

China has unveiled the first official rule on the use of virtual currency in the trade of real goods and services to limit possible impact on the real financial system. The Chinese government also spelled out the definition of "virtual currency" for the first time, which includes prepaid cards of cybergames, according to a joint announcement from the Ministry of Culture and the Ministry of Commerce Friday. It said:

The virtual currency, which is converted into real money at a certain exchange rate, will only be allowed to trade in virtual goods and services provided by its issuer, not real goods and services.

The ban is primarily aimed at "gold farming," an Internet-age phenomenon in which players in less developed countries collect and sell virtual gold (common to games like World of Warcraft) to wealthier gamers in the developed world. This enables gamers who have the means to buy virtual gold to get ahead in the games without actually having to accomplish the grunt work.

The trading of virtual currency for real cash generates between $200 million and $1 billion annually, according to a 2008 survey conducted by Richard Heeks at the University of Manchester. … Read more

Sesame Workshop: Video games good for kids

A new report (PDF) published by the Joan Ganz Clooney Center at Sesame Workshop discusses the potentially positive effects of video games in educating children and promoting their physical well-being. (And if you can't trust the fine people at Sesame Workshop, who can you trust?)

Studies that look at the effects of video games on kids have been mostly positive of late, with a focus on safe virtual worlds, and devices such as the Nintendo Wii that encourage physical activity.

The new report "Game Changer: Investing in Digital Play to Advance Children's Learning and Health" (PDF) urges educators as well as government and the health care industry to look beyond the stereotype of video games as harmful.

Video games have been shown to help children learn vital foundational and 21st-century skills, including:

Content (from rich vocabulary to science to history) Skills (from literacy to math to complex problem-solving) Creation of artifacts (from videos to software code) Systems thinking (how changing one element affects relationships as a whole)

Myths and realities of teen media trends

Nielsen is out with a new report on media consumption by teens and the results are counter-intuitive to what we commonly believe to be the norm. According to the How Teens Use Media report (PDF), "teens exhibit media habits that are more similar to the total population than not."

Key takeaways from the report:

Teens are not abandoning TV for new media: In fact, they watch more TV than ever, up 6 percent over the past five years in the U.S. Teens love the Internet, but spend far less time browsing than adults: Teens spend 11 hours … Read more

Guitar heroes dismiss Guitar Hero game

Led Zeppelin guitarist Jimmy Page and The White Stripes' Jack White have taken shots at the popular Guitar Hero video game, according to a report in NME.

Speaking at a press conference in Los Angeles on June 19, the two guitarists said "they don't believe video games are an ideal way for people to be exposed to music or learn to play instruments."

As much as I enjoyed Guitar Hero, I have to agree that it's annoying that the game doesn't teach you to play an instrument and depressing that game buyers aren't really interested in the music itself--just how hard the game makes it to play the songs. The silver lining is that bands such as Dragon Force would be even more obscure if it weren't for the game.

"It's depressing to have a label come and tell you that Guitar Hero is how kids are learning about music and experiencing music," White said. He added that although he doesn't try to dictate "which format people should get their music in...if you have to be in a video game to get in front of them, that's a little sad."

Page added that he can't imagine that people are really learning anything significant about playing instruments by playing video games.

"You think of the drum part that John Bonham did on Led Zeppelin's first track on the first album, Good Times Bad Times," he said. "How many drummers in the world can play that part, let alone on Christmas morning?"