What Are We Missing?

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What Are We Missing?

• Raph Koster
• President, Areae, Inc.

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Who am I?

• Im a game designer, not a businessperson
• Despite my current title and job
• Ultima Online, Star Wars Galaxies, A Theory of
  Fun for Game Design, CCO at SOE
• Running a VC-backed startup to reinvent MMOs
• Which I will talk about a bit at the end

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This talk is basically about trends represented
by these four people.
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Some starting premises
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The shape of markets

• A bunch of buzzwords
• Scale-free networks
• Power laws
• Long tails
• A bunch of assumed concepts
• Branding
• Lovemarks
• Service

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City sizes

• This curve is basically invariant across decades.
• This is a healthy distribution.

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NPD also follows this pattern (2003)
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NPD, 2006
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Monopoly

• A monopoly shows a kinked curve

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Drivers of monopoly
Similar goods
Custom services
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FPS, 2003

• The more similar the goods on offer, the more
  likely you are to get a monopolistic situation,
  because we buy what our friends have.

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FPS, 2006

• We create game systems (aka genres) and then make
  them more baroque over time, appealing only to
  aficionados.

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• Evolution is not progress
• It is adaptation to a niche.

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• Typical KB of data for a AAA game

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1982 game team
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• 2005.

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AAA budgets
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• Budgets have gone up by a factor of _22_.
• We make _40-150__ times more data.
• And weve gotten only _6__ times better at making
  content.
• in just the last 12 years, and thats adjusted
  for inflation

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Our industry premises

• Budgets dictate audience size.
• There is little correlation between quality and
  day one sales.
• We create genres and then spend them to death.
• Budgets breed conservatism even a vertical
  slice is larger than last gens whole game.

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Lets compare

• In practical terms, the strike is about money
  how much, if anything, writers get as the
  Internet and DVDs replace TV reruns, for which
  they get better residuals.

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• But in a larger sense, the studios and writers
  are forcing a question that every other form of
  media is facing How much is content worth in the
  digital age?

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• Zero.

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• If theres one thing the Web makes possible, it
  is enough content to make the typical content
  creator superfluous.

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All games are services now

• And that means
• Branding
• Celebrity
• Lifestyle marketing
• Upsell-driven revenues

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One result is a new kind of publisher
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One with far less revenue but much stronger
emotional connection to its consumers
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Adventures in ARGs

• and other mammals in the dinosaur world

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• Jane McGonigal
• One of the most important designers in the last
  ten years and yet, at the edge of our
  (supposed) industry.

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Some Alternate Reality Game stats
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Compared to YTD retail top ten games
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Oops, I forgot the actual big hit.
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ARGs are just part of a larger trend

• Brain Age

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Of massively broad market entertainment
experiences

• Line Rider

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Some of which seem not like us

• Bar trivia

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But most of which are clearly video games

• PHP-driven turn-based massively multiplayer web
  games

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Or leverage similar tech

• Fantasy football

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And garner enormous audiences

• Facebook zombies and vampires and and and
• 27m person audience?

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But we dont see them as us
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In part because of visuals

• Club Penguin

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And partly because we have a narrow definition of
interactive entertainment

• Hot or Not
• 10 virtual roses!

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That doesnt include things out of snobbery

• Travian

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Or misguided focus on pro level content
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This is our industry

• LOLCatz

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• This is the complete instructions to Pong
• AND the strategy guide to boot.
• 79 bytes including carriage returns

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1574912 bytes
262000 words
Over 1400 pages
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• Interfaces have been a huge barrier for users
• 1972 Pong. One analog.
• 1979 Atari. 3 binary.
• 1985 Mac. 2 analog and one binary.
• 1985 NES. 6 binary.
• 1994 PS1. 14 binary, 4 analog.
• 1997 Dual shock 12 analog, 8 binary

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Successful mass market interactive entertainment
Model first The system is the game
Universal inputs Any button will do
Long phases Take your time
Short decisions Be done fast
Massively parallel Side by side
Extended accumulated state Save your profile
No roles Classless
Representation agnostic Draw it however
Open data Change it however

• Asynchronicity
• Indifference to rendering
• Minimal controls
• Platform agnostic

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Myers-Briggs

• The core gamer market is mostly INTJ, ISTJ, INTP
  and ISTP in the Myers-Briggs typology.
• Programmers tend to be of the first two.
• Core games tend to be hardcore conqueror type
  games.
• Book 21st Century Game Design

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Those types represent only 19 of women.

• Which brings us to Jade Raymond

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Who gets treated poorly
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In very large part
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• Because of the culture that we have created and
  reinforce

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Because it is us.
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The MMO mistake

• Or, other people are stealing our thunder

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• This guy is more important to the future of
  virtual worlds than Mike Morhaime or Rob Pardo.

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• His name is Gene Endrody, and he made this MMO in
  his basement, and has 1.2m monthly unique users,
  running in a browser in Shockwave.

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Googles fastest growing keywords for 2007

1. iphone
2. webkinz
3. tmz
4. transformers
5. youtube
6. club penguin
7. myspace
8. heroes
9. facebook
10. anna nicole smith

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Yahoos top searches for 2007

• Britney Spears
• WWE
• Paris Hilton
• Naruto
• Beyonce
• Lindsay Lohan
• Runescape
• Fantasy Football
• Fergie
• Jessica Alba

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The industry thinks that this the MMO market

• Check out the kinked monopoly curve!
• BTW, this is older data

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• But this is more accurate.
• Notice that all the mainstream MMOs are
  actually too small to show up.
• I used to say that MMOs will be mainstream when
  theres one based on a breakfast cereal Well

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Millsberry
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Nexon stats for Maple Story

• 1.6m in sales in March, growth of 60 to July
• Est 1st year at 40m
• 3 million users in NA in a few months

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Movie theater in Faketown

• Thats videos streaming from YouTube.

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Media companies have moved on convergence

• But our industry hasnt.
• Laguna Beach episodes premiere in a virtual
  worlds first, then on TV
• Basically, we thought we owned this space, but
  really, outsiders have quietly taken it from us
  and are driving the agenda.

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MMO publishing activity

• NCSoft 1 (plus shuttered Auto Assault)
• EA 0
• Vivendi 0
• Midway 1
• Disney 3
• MTV 5

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Meanwhile, our core audience is telling us give
us more casual stuff to do!

• And writing checkers mods for World of Warcraft.

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Talking transmedia

• Aka, if we are a content business, we should
  learn how its really done.

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We feel good about this.

• 1 in Sep 07 HALO 3, moving 394,548 units

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• But Harry Potter is a REAL transmedia IP.
• And dont tell me but nobody makes money from
  this.
• J. K. Rowling does. Warner does. Its marketing.

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• A totally invidious and unfair comparison my
  monthly unique blog visits vs sales of The Orange
  Box.
• The point is not that this is a fair comparison,
  the point is that we compete for eyeballs across
  the entire media landscape.

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• TRANSMEDIA ENTERTAINMENT allows me to reach a
  massive global audience.  By making creative use
  of multiple platforms, I can now entertain the
  world via broadcast, broadband, cellphones, game
  consoles, publishing, etc.  As a content creator,
  I am no longer restricted to just one platform
  and its limited install base, but can now make
  use of every available platform, and use them all
  to reach an almost unlimited number of content
  consumers.
• Jesse Alexander
• Notice that our entire industry is bracketed
  within a couple commas on his list. That is a
  very different level of ambition from what we
  generally pursue.

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• Based on a book, of course
• 1 movie ever

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Open to viewpoint reversals, parody
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Radically different sequels
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• Nor does the source material necessarily limit
  the potential

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• After all, this story of the little womens
  missing father won the Pulitzer Prize for fiction
  last year.
• And who is the missing father in Halo who
  deserves a book? In fact, who is the second most
  interesting character in Halo, the Warthog?

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Heres a recent example

• First a book

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• Then a musical, movie coming.
• Perhaps one test of whether youve created a
  strong IP is can you picture the musical
  version?
• Bioshock the musical? Uh

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Lets pick something closer to our industry
culture
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Rendering agnostic
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Radical reinterpretation
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Co-optable
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Merchandisable
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Capable of addressing different psychographics
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Cross-cultural
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• Emotionally connected to consumers.

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Transmedia

• is not characters alone
• is not milieu alone
• can be rendered in many ways
• allows and encourages remix
• is open to many sorts of narratives
• is really not like how we make games at all!

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The Web

• Or, some minor pimpage

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The Web Is

• Based on users doing stuff, not pros
• Premised on really rapid development
• Small pieces loosely joined
• Long tails and lots of tagging
• Aggregation and remix, not exclusivity
• Infinite shelf and diversity, not lock-in
• Platform agnostic

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The Web Is

1. The replacement for consoles.
2. The new default medium for entertainment.
3. A radically different platform than any we are
   used to.
4. Eating every content industrys lunch.

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The game has changed

• The hot platform is the net
• The hot audience is the non-gamer
• The hot feature is other players
• The hot technology is connectivity
• The hot game is a mini-game

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• A markup language that describes games
• Anyone can write a client
• Client can be on any device ours is Flash
• A generic server that handles Tetris or WoW
• Standard language for content development
• Stylesheets are world-in-a-box
• Modules are snap-together systems
• Aggregator/index site for every world

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If I were Sony, MS, or Nintendo

• Id be asking what is the common platform
  installed in the homes of 100 of our target
  audience?
• The answer is Flash. It is the next-gen console.
• (BTW, Flash will be 3d in the next year, and
  there will be an OpenGL context in a browser in
  Firefox next year too).

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• No other medium uses total platform lock-in.
• The question is whether the current console
  industry is destined to be this

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