The Five Year Post

2010 has started with a ****load of work, and so the usual set of predictions I'd write at the beginning of the year has had to wait. At the same time though, I noticed that the fifth anniversary of my blog has come up. I thought it was worth taking a few minutes to ponder what's happened in that time.

Personally, a lot has happened. The twins went from cute little one year olds to thriving, brilliant little kindergartners (and gamers!). We had a smaller auxiliary backup child. I moved from Intel to Microsoft and back to Intel again (which brought a move from PDX to SEA and back to PDX). I went from running an engineering team to doing business development to doing long-term business planning. Hard-core games to casual games and back again. I edited GPG5, and of course, wrote a 1301 of blog posts. 1302 if you count this one.

To quote JK Simmons in Burn After Reading, "So... what have we learned?"

I'm certainly posting a lot less, from almost 400 posts in my first year, down a bit in 2006, sharply dropping off 2007,2008, and levelling off in 2009 with almost 150 posts. Part of this is attributable to things like Facebook, where more trivial short subjects and links might get posted as a FB status update rather than a blog post. Mostly though, it's concentration of my effort on the blog toward matters that I think will provide interesting food for thought and spur conversation in the blogosphere. In contrast, I do less linking to other people's stuff (I really should get my del.icio.us links working in an automated fashion, as it would make doing that far easier)

I did a couple experiments in generating revenue. I never thought these would amount to much, but want to experiment a bit just to understand the mechanics of it:

• I tried advertising with Google, later switching to TextLinkAds. the latter pays WAY more, generating a steady $30/40 month (google was much less). Hey, its beer money.
• Amazon associates, for my level of traffic, is hardly worth the effort, generating maybe $10/year for me. The new relationship with Google should make the link building/posting easier, but otherwise its not worth the bother.
• There was a period a couple years back when bloggers/social media frequented the news. A bunch of people sent me copies of products in hopes that getting blogs to write about them was the new path to success. That seems to have tapered off, which I believe indicates less indiscriminate shot-gunning of product.

It's no secret that traffic can spike depending who links to you and why. The most popular posts (as judged by linkage, comments, etc) fall into a couple categories:

• Post-mortems of conference sessions that people couldn't attend, like this one trashing Google's Casual Connect session on AdSense for games, or this one on Stumptown Game Machine's iphone post-mortem.
• Opinion pieces on games business models/economics/marketing, like this one on used games, or this one on Indie games marketing.
• Anything controversial, like my post in defense of Chris after his Wii rant.

In thinking about it though, the popularity of the blog (what little it has) is of little import. The entire effort has been highly positive, and the value has come mainly from two things:

First, the blog provides a place for me to post my thoughts, and this in turn requires me to organize them. When I post something on a technology or business models or whatever, I'm forced to structure my thoughts into an argument, look to the other side, etc. This leads to a better understanding on the topic.

Bigger than this though, is what the blog has done to start new friendships or reinforce existing ones. It's through the blog that I've become (or become better) friends like Mark, Robin, Alice, Darius, Raph, David, and many many others.

For these two reasons alone I would highly recommend blogging as an activity for building relations, structuring ideas, and getting feedback. From this respect its been a huge return for the time invested.

Lets hope it continues to be for the next five years!

Four Pointers on the Future of Games

I read a number of posts over the past week or two that opened my eyes. Here they are:

1. Dan Cook's 'Flash Love Letter' series of posts (two so far: one, two. With more coming soon) on Flash games, the opportunity for premium flash games, how to monetize them, existing (flawed) feedback systems when distributing through portals, etc. His blog has always been gold, but this series of posts shows that he understands this space better than almost anyone who's writing about it. Much of it applies to all digital distribution and not just Flash games.
2. Raph's liveblog of the AGDC panel on monetizing online games: Free-to-play biz model experts discuss successes and stats around different tweaks on the biz model and how it's evolving. I remember when I first worked in casual games, being surprised about how scientific (in the sense of hypothesize-->test-->measure-->analyze results) the business was compared to traditional big-budget retail games. This group takes it up a notch. A must-read.
3. Alice's post on Smokescreen. Smokescreen is an online game that aims to educate teens about issues involved with their online activities, like identity, privacy, security, etc. By all means go play it - at least see the first mission through. It will challenge both what you think is possible in an 'educational' game, and in the quality of production possible in a publicly-commissioned game. On the latter note, I'm not sure what the budget was here, but its clearly NOT your $50k flash game. It's polished, rich, and deep. It doesn't take much to extrapolate a few years out and think about what it means when your games have to compete with free-to-play, $10M+ budget titles funded by your taxes.
4. This GamesIndustry.biz post on Bobby Kotick's comments about 'untethered' Guitar Hero. Kotick has done his share of talking out of his rear, but this is not one of those cases. The idea of a stand-alone SKU of guitar hero, connected to a dedicated service, is not as ludicrous as you might first think. Music games are a phenomenon and there are still a lot of households without consoles. If some of the people who shelled out $250 for a Wii did so to buy 'the Wii sports machine', then I don't see why this wouldn't hold for people that want GH or Rockband but don't own one of the big 3 consoles. And if this is a route for publishers to connect directly to their customers without console holder as middleman? Hmm..

As I said above, these are four must-read posts. A lot of hints as to where we'll be going over the next decade are to be found in there.

Eve and the Sacking of Rome

[update: Really good summary here.]

I've meant for a little while now to blog this really interesting development in Eve Online, in which the 'Band of Brothers' Alliance was destroyed by a rival faction. As always, I hate playing MMOs but love following the stuff that goes on in them.

For those unfamiliar:

Eve Online: (snipped from wikipedia): is a player-driven persistent-world MMO set in a sci fi space setting. Players of Eve Online are able to participate in any number of in-game professions and activities, including mining, manufacturing, trade and combat. The range of activities available to the player is facilitated by a character advancement system based upon training skills in real time, even while not logged in to the game.

The event (as Destructoid put it): In the most balls-out act of deep space espionage in the 21st century, GoonSwarm, EVE Online’s in-game Something Awful forum contingent, has finally defeated their arch enemies, absolute rulers of the game universe, Band of Brothers. Thus ends a years-long David and Goliath dance that has made modern gaming history on multiple occasions. As this is a breaking story as of today’s wee hours, I’ll spare you my verbal flatulence and put my better-informed friend Bjorn Townsend on blast:

Literally, Band of Brothers is no more. They got a spy into the executor corp at director level, kicked out every corp, stole all the assets they could lay their hands on, and altered standings so that everyone will start shooting everyone else. And then they closed the alliance, and created a new corporation called Band of Brothers with the same corp ticker, so they can't even have the old alliance name back.

How awesome is that. Even more awesome when you remember that there are ways of turning in-game currency into real-world currency, and that this cloak-n-dagger takedown netted an amount equal to about $15k USD. This is Halting State turned real, or close to it.

As usual, Raph offers an interesting perspective, which I agree with:

And the game, as a game, does want BoB to fall, because from a purely mechanical point of view, what is fun about EVE is the struggle, not the victory condition. The victory condition is boring. Lots of folks lose their livelihoods when an empire falls, and players invested in BoB are likely upset that years of work were lost. But EVE is not a game about the height of the Roman Empire. It’s a game about the sacking of Rome by barbarians, so that they can become the next short-lived top dog

The Virtual World Taxman Cometh

As aluded to previously, we all knew it was coming.

Raph points us to this: Virtual Worlds News: China Levies 20% Tax on Virtual Currencies

And notes:

[the ruling] seems to apply whether or not the value is cashed out.

(and goes on to note)

However, if the value is not cashed out and taxes are still paid, that could mean (maybe should mean) that the companies are liable if they manage to accidentally delete some of it. In other words, they’re banks.

I commented on his post that non-Chinese MMOs like Wow are probably glad they licensed the right to run servers in that country to other parties. Boggles the mind to think how something like this would apply, be determined, be policed, etc, if numerous countries were to institute similar laws. Thousands of individuals all paying taxes on income incurred in other countries (where the servers reside), and businesses in some cases being run from elsewhere than where the servers reside. Blech. What a mess!

It's already moderately messy to do taxes for, say, stock purchases & sales, if you do anything moderately frequent in the way of trading. Now imagine that on a micro-scale at an accelerated pace. 

As I understand it, in the USA, Internet commerce has been relatively hands-off in the area of taxation; as an incentive to promote growth. However that can't last forever, can it? At some point, growth has happened. Plus, no one is doing VW business in the US only going forward. 

This whole idea of 'countries' is obsolete :-)

Areae now Metaplace, gets more money

Congrats to Raph and company for closing their series B round for 6.7M.

Among the investors is Marc Andreesen, which I view as - at least in this case - a 'smarter than the average bear' investor. His take on 'levels of internet platforms' which I previously blogged, would class Metaplace as a 'level 3 platform'. I view this as a very strong endorsement of Metaplace. 

Go Raph!

More on retail's evolution

Not one, but two trips to Target in close succession. Ugh. Anyhow, another interesting observation.

Last time, I'd posted something about retail's evolution, upon which Raph added some thoughts.

This week, I noted the huge end-cap of point-of-sale point & subscription cards for virtual worlds:

Some thoughts:

• Look at how many there are! Twenty or so varieties and that's just what I got in frame! It wasn't so long ago that only WoW was doing this and even then it surprised people.
  
• Look at the variety! Acclaim, Toontown, WoW, Dora, City of Heroes, Club Penguin, Pirates of the Caribbean, Habbo...
• Look at how many I've never heard of! BrainPop.com?

And this doesn't even count those who's retail transaction is obfuscated by masking it in a plush (or other) toy, like Webkinz, BuildaBear, BarbieGirlz... (of which I've written here, and here).

Evolution indeed!

Halting State's Sharpening Focus

I purchased Charles Stross' Halting State a while back but only got to reading it while on vacation last week.

It's a fun read. Not a great read, but a fun one, and one that should be required reading for those in our industry.

The book is a story of a couple reluctant heros that get wrapped up in an investigation of bank heist that unravels into a story of international espionage, etc, etc. On that basis alone, it's kind of a 'B' read. It's not a superb story as far as heist or spy stories, and doesn't have the page-turning action sequences of, say, Neal Stephenson's Snowcrash, though there are parts that almost get there.

However, what makes the book interesting, and makes Snowcrash a good point of comparison, is that the bank heist takes place in a virtual world, with a band of rogue players cleaning out a bank and then selling off the items for millions via online auctions. The heros' sleuthing takes place in both the real and virtual worlds.

Where the book succeeds, as Raph Koster pointed out a while ago, is in how well it nails all the details and issues around virtual worlds. To quote Raph:

Among the stuff that pops up, “namechecked” so to speak: PvP sploits. God mode. ORLY. Zombie flash mobs. Leveraging ARGs for real work. Impositional game design. VC bubble shenanigans. Cross-world avatar portability. Cons and cosplay. Discworld. LARPing. 4th edition D&D. Second Life. Mirror worlds.

... add to that Augmented Reality, cross-platform gaming, serious games, using VW's to launder money, etc, etc. Stross shows that he really gets it, and as great science fiction should, projects the possible implications that stem from the 'science'.

The thing that struck me most was this: If Stephenson's Snowcrash drew us a picture of the metaverse (and excited a bunch of people enough to run out and start VRML companies :-), then Stross, some fifteen years later, uses his book as a lense to sharpen that picture for us.

Highly recommended. Go Get it!

Metaplace elevator pitch video

There's been a video posted of Raph doing this short version of the metaplace pitch. If you haven't heard about it yet, well, you will.

Areae Opens the Kimono

Of course, after the cryptic note in my last post, sure enough Areae has spilled the beans.

That's the 'Level 3' gaming platform I alluded to. I've seen it in action and it is going to *significantly* shake up the landscape.

Congrats to Raph, John, and the rest of the gang there. Now get to beta!

Facebook factoid

So I hooked up with some former Matrox co-workers last night in Toronto for dinner, and amongst other topics, the subject of Facebook came up. Some of that conversation became relevant to a thread over on Raph's blog, so I commented there and am reposting here.

I signed up for Facebook to check it out after several friends far more in-the-know about these things said that it was going to be dominant based on it’s prowess as an extensible platform (Marc Andreesen has a great blog post about this here).

Anyhow, I was surprised to see (a) how many people I knew were already on it, and (b) how they came out of the woodwork to find me, sans my searching for them. After perhaps 10 days of usage, it’s already my 3rd most useful SN service after linkedin and flickr. (I guess I have to add that Xbox Live is a SN service in many ways, and would come in #1 as most used, and perhaps #2 in most useful).

One trivial Facebook factoid that might skew the data: I’m a montrealer and have many friends in Toronto. Toronto has the largest population of facebook users of any city in the world, with over 700k users!

My own hypothesis on this is that it’s a combination of (a) higher BBand penetration in Canada than in US, (b) Facebook being relatively unknown in Europe/Asia (asserted by one of the dinner attendees, a Brit), and (c) Toronto being fairly affluent compared to the rest of Canada and certainly a bigger city than any other in Canada.

World of LastResortCraft?

Ok, I'm not a WoW player, so I don't understand teh mechanics of how all this stuff works.

However, I was surprised to hear (via Raph) that Blizzard is suing a company doing in-game spamming of their gold-farming services.

Normally, going the legal route is a last resort. It would seem that in an in-game scenario, for a game for which (a) Blizzard write the policies & terms of use, and (b) Blizzard and their partners administer the servers, there'd just be an easier and more effective way.

Resorting to the courts, especially in this case where (as Raph points out) the defendant is a company based in China, seems like a real last-resort type of effort.

...but we make it up in volume!

Robin points us to the "Develop 100", an interesting attempt by Evolving Media to build a list of "The World's Most Successful Game Studios" by (according to their site):

Develop 100 ranks the world's games development studios based on the revenues their products made at UK retail in 2006.

While and interesting idea, it falls short of the mark for a couple reasons:

- UK only. Meh.
- Retail only. ('We rated the most powerful transportation vehicles by the amount of hay they consume in a day!'). 'nuff said.

And of course the biggest issue (and granted, hard to put THIS list together) is that I'd much rather see the list ranked by contribution margin rather than just revenue. To borrow Raph's metaphor, (which is also his business plan, I guess) I think you'd see a lot of small mammals ranked higher among the dinosaurs.

And as Robin points out, it'd be interesting to see this ranked by a number of factors. QoL, GameRankings average, etc, etc.

Raph at Etech

Turnabout is fair play.

Alice has liveblogged Raph's session from Etech. Also a good read.

(As an aside, I would like to pit these two against each other in a game of TyperShark. M4D typing skilz!)

A fantastic ETech talk I wish I'd caught...

Raph has liveblogged Danah Boyd's Etech talk entited "Incantations for Muggles". Its awesome. Wish I'd been there for it, but Raph's thorough notetaking are a nice substitute. Really interesting stuff on changing social norms due to impact of technology, and on the use of technology by different people at different stages in life (and the costs of trying to make one size fit all).

Notable quotes:

"Expansion has costs. One of the costs is that you get people angry with you. The common response is lock-in: you have to stay even if you don’t want to, which goes against what people really value. Unhappy users do not make products stick, cf Friendster."

" Twitter is the most fascinating example of complete cognitive overload. Is it really building meaningful social realitions? Do we really gain anything? I know way too many details about Angelina Jolie. She won’t be there for me when I have a crisis. Will Twitter friends be there for you?"

One of the closing comments of the talk is particularly relevant in the context of my earlier post about Kathy Sierra.

"What does it mean to pay attention to the spells cast in both directions? The accidental spells? The Star Wars kid? The student who gets kicked out of college because of their Facebook? We think it’s all positive. Are we always happy with that? Do we even think about it, or do we forget that people’s lives are at stake."