Facebook is the new Xbox?

30 Mar

GDC 2010

Although I didn’t get to attend this year’s Game Developer Conference in San Francisco my coworker (thank you Zander!) went and brought back lots of great stories and notes. After trying to play catch-up as best of could via twitter and blog posts, it seems that I missed a pretty relevant and exciting conference.

In particular, I’ve been reading follow-ups to Kristian Segerstrale’s (Playfish) keynote, The Relentless March Towards Free…and What it Means to the Games Industry.

In the past two years Playfish has released 12 games, two of which have a bigger reach than World of War-craft. He talks about the switch from products to services. There is a transition from the old way of making games to the new way of making games. It used to be that games had to be written to a DVD, put in a box and then on a shelf. Once it is written to a DVD, it’s written in stone – the game is finished being developed.

Products now are no longer physical, but now products are digital. The minute a product is fully digital then one is able to change it instantaneously. This also means that the game is never “finished” and is in perpetual beta.

Kristian Segerstrale

Along with this switch from product to service, Sergerstrale discusses how in the future “social gaming” will just become “gaming”. He states that the problem currently with Xbox is that it limits the types of friends a user can have access to. Because of the barrier to entry, the only friends you see online on Xbox are your friends who own Xbox. What Facebook does well is allows users to interact with their friends inside and outside the game at the same time.

It’s now important to think about how to create interest and excitement outside the game in order to drive actions back towards the game. With approximately 1.8 billion users (and growing) on the internet, the barrier to entry for Xbox and the barrier to entry for computer based games becomes very apparent.

The idea of extending gameplay from outside the console – to desktop, smartphones and other devices is something that is inevitable. Gamemakers, like any other industry, need to go to where the users are in order to be successful. As content consumption habits change the content delivery channels must change as well.

Overall it seems like I missed a great talk and a great conference. Hope to make it next time around!

3 Responses to “Facebook is the new Xbox?”

  1. Snow 30. Mar, 2010 at 9:25 am #

    So where/what is the monetization method? Charging players for credits that go toward character upgrades, etc? Are in-game advertisements (product placements) at all measurable? Do merchant advertisers pay well for these kind of inclusions in games?

    Just curious!

  2. Johnnyjuice 30. Mar, 2010 at 9:45 am #

    I think that there certainly is a shift towards micro-transactions in games and download-able content. For instance Matt, I’m sure you love Guitar Hero, but after you play & beat the 40 or so songs that came in the box what do you do? You buy & download more songs, extending the life of the game you bought. The game makers get the price for the game you bought off-the-shelf plus all future revenue from content you might buy.

    So what if the price for the initial game went down, or disappeared, but the opportunity for in-game revenue increased? What if you could not only buy songs, but clothes for your avatar, better guitars, tour bus upgrades, etc.. That’s revenue over time, not cost of admission (owning a game), and now since it’s cheap, or free to play, you have more people using your product.

    Player upgrades, in-game currency, avatar customization and download-able content are all viable, tested methods of monetization.

    I don’t know much about the figures for in-game advertisements, but it is still a very big part of how some games make money. I know that the technology is definitely advancing this as well. If a player is connected to the internet, then their game can dynamically update the ads in the game. So if Pepsi launches a new global campaign with a new logo, the in-game logos can up updated in realtime to reflect Pepsi’s new campaign…pretty cool.

    Again, I don’t know a whole lot about in-game ads, but I think if games go online and are by nature connected to the internet, then the data and analytics would be much more measurable than a game that was only console based and possibly offline.

  3. Snow 01. Apr, 2010 at 4:00 pm #

    Hot damn!

Leave a Reply