Nick to spend $100m on 600 games March 18, 2008
Posted by jeremyliew in advertising, casual games, games, games 2.0, gaming.2 comments
The NY Times has a story on Nickelodeon planing to spend $100m on 600 exclusive casual web games over the next two years. They certainly have a huge audience of people playing casual games across a network of sites:
With a series of customized sites for different age groups (preschoolers, tweens, teenage boys, moms), Nickelodeon calls itself the “biggest gaming network in the country.” Movie studios, video game publishers, and toy makers are among the top marketers on the sites. In the online games market, its stiffest competition comes from Yahoo Games, which had 15.5 million unique visitors in February according to the measurement firm comScore…
The N, Nickelodeon’s teenage network, has dozens of games for children aged 12 to 17. Slightly younger players are directed to Nick.com, which drew an average of 2.1 million visitors in February and is expected to add 185 games this year. The youngest players of all are welcome on the sites of Nick Jr. and Noggin, where games are meant to be played by children “on the laps of their moms,” Ms. Zarghami said.
The company also owns Neopets, a virtual pet Web site. The investment will add scores of new games to each site in the coming year…
MTV Networks acquired three sites to strengthen its gaming brand in 2005 and 2006. Of the three, Addicting Games is by far the most popular, averaging 9.4 million unique visitors in February, a 50 percent increase over the same month last year, according to comScore.
paidContent.org has more details:
Among the initiatives included in the investment :
— the launch, planned for September, of ad-free subscription service myNoggin, being offered with cable companies Charter, Cox and Insight and through direct subscription online.
— The transition of Neopets to NeoStudios, which will focus on creating new virtual worlds and further developing existing ones. The first new launch is slated for the end of 2008 with “a goal” of launching a new one every other year.
— The branding of Shockwave as “the” games destination for families. Somehow that includes new opportunities for “prominent integrated advertising.”
— AddictingGames is getting into the casual MMOG business with AddictingWorlds.
— The planned early 2008 launch of The-Ngames.com, dubbed “the first major casual gaming site to focus solely on teen girls.”
— A subscription product for Nickelodeon called the Nick Gaming Club, “a safe gaming environment.”
— 3D Slimeball. Now there’s the Nick we all know and love. Actually, it’s one of the multiplayer games for Nick.com. Nictropolis also gets multiplayer games.
The idea seems to be grab them as young as possible and keep them moving to various age-appropriate options.
From the sounds of the article, Nickelodeon primarily plans to primarily monetize through both subscription and advertising. Given their existing advertiser relationships and their huge reach, they should be able to help establish some standard advertising units in the casual games industry. That will be great for the industry. New forms of advertising are hard, and standard ad units lift all boats.
Free to play arguments February 27, 2008
Posted by jeremyliew in advertising, business models, casual games, digital goods, freemium, games, gaming, virtual goods.3 comments
At GDC the argument continues over whether free to play and microtransactions are the future of games, or whether single sale and subscription models will continue to hold sway.
As I’ve opined in the past, the economic principle of marginal cost pricing suggests that free to play models will become dominant. At a round table on digital goods business models at GDC, one of the EA folks working on Battlefield Heroes noted that their surveys found that hardcore gamers and older gamers objected the most to digital goods, but that casual and younger players accepted it without comment. If the future of gaming is about breaking beyond the hardcore to the mass market, those defending the old models may be missing the larger opportunity.
Russell Carroll has an interesting post at GameSetWatch that sheds some further light on this issue. It is ostensibly about piracy in the casual game business and opens with the stat:
“It looks like around 92% of the people playing the full version of [the game] Ricochet Infinity pirated it.”
Carroll asks, if piracy can be stopped, can sales be increased by 12x? (i.e. would all the pirate players buy). After looking at all the methods by which the company could reduce piracy, and the impact of these methods on both downloads and conversion rates, he concludes:
As we believe that we are decreasing the number of pirates downloading the game with our DRM fixes, combining the increased sales number together with the decreased downloads, we find 1 additional sale for every 1,000 less pirated downloads. Put another way, for every 1,000 pirated copies we eliminated, we created 1 additional sale.
Though many of the pirates may be simply shifting to another source of games for their illegal activities, the number is nonetheless striking and poignant. The sales to download ratio found on Reflexive implies that a pirated copy is more similar to the loss of a download (a poorly converting one!) than the loss of a sale.
Think about this from the other direction. Currently, for every 1000 players, 80 bought the game and 920 are playing a free, pirated version. So the company makes around 80 x $20 = $1,600. If they were to eliminate piracy, they would sell one additional game, so their revenue would be $1,620.
At a recent panel on casual games, Alex St John said that he was able to sell advertising to support casual games monetizing at 15c/gameplay and that he was sold out of inventory.
To make $1,620 on advertising at 15c/gamplay, the 1000 players would on average need to play the game about 11 times each, which doesn’t seem unreasonable. (This assumes that the source of advertising dollars will be scalable.)
If you add to this a digital goods opportunity, the alternative becomes more interesting. Daniel James (CEO of Three Rings) has said in the past that the ARPU from digital goods is about the same as that from subscription, but with a distribution curve that looks more like a power curve – some heavy spenders and a long tail. An industry rule of thumb for digital goods monetization is around 5-10% of players will pay. Applying the same metrics to this game suggest a digital goods revenue stream in the $1,000-$2,000 range, incremental to the advertising revenue.
And finally, this doesn’t even begin to address the question on how many more players will play the game if the free period is not limited to 60 minutes. These incremental players all become candidates for monetization by both advertising and digital goods. Crossing the Penny Gap can dramatically cut the universe of users, as Josh Kopelman has noted before.
I would advise game designers to consider baking digital goods and advertising opportunities into the core mechanics of their new games so that they have the flexibility to explore both these business models as well as the proven subscription model.
UPDATE: Carroll has more data on his casual game pirating experience here.
Games 2.0: Lessons from Travian February 14, 2008
Posted by jeremyliew in asynchronous gaming, casual games, game mechanics, games, games 2.0, gaming, social gaming, user generated content.5 comments
Travian is a popular in-browser asynchronous massively multiplayer game; you build a village in “Roman” times and set off to expand your empire, raid others and form alliances. It has many of the games 2.0 characteristics that I’ve been blogging about and has been growing nicely, as Alexa shows:
As a passive web game:
it’s persistent. it’s massively multiplayer. it’s competitive. it’s social. it’s portable. it’s passive.
passive web games are setup to permeate your life. they become habitual. they are inherently attractive to gamers with little time — whether that time is taken up with work or other games. they fit unobtrusively into the corners of your life, taking as much or as little time as you want to invest.
… it’s a game you’ve never heard of, but, it gets 225 million page views a day
Most game reviews are glowing, noting the appeal to both casual gamers and obsessive gamers. One review though notes that at heart this game is about negotiation and diplomacy:
Politics is the name of the game, as while there’s room for intelligence to make a difference in combat, in the end, if someone has enough troops (and the resources required to build them) they can crush anyone. So friends are important, or at least fellow wolves
The reviewer complains that the scale of the player base ultimately becomes a problem for a diplomacy based (ie social) game. With 20,000 or more players, it far exceeds Dunbar’s number.
I can’t help but think whether building such a social game on top of an existing social map might improve gameplay even further.
What games work best on Facebook? January 15, 2008
Posted by jeremyliew in asynchronous gaming, casual games, facebook, game design, game mechanics, games, games 2.0, gaming, platforms, social networks.16 comments
Three good blog posts recently about games on Facebook.
Brian Green talks to a developer with two games, one casual and one hardcore, and based on that concludes that hardcore games do better:
I suspect the reason is because people still enjoy a good game, even if it has “hardcore” aspects like direct, zero-sum competition. Even though the party game was less confrontational, it probably didn’t include as many engaging elements as the first game. So, more people played and stuck with the game.
What he is really saying though seems to be that good games are better than bad games. Matt Mihaly checks the list of Facebook games with most daily users and finds that the top ten are all casual games, and notes that:
…good games on FB are as much about communication and/or self-expression as they are about gameplay.
I completely agree. As Matt notes in his post, there have been two paths to success for Facebook games. One has been to build lightweight “proto-games” that spread virally on the back of self expression or communicaiton. The other has been to build true games with complex and engaging game dynamics. These games do not grow as rapidly, but they do draw much higher daily engagement rates.
Nabeel Hyatt extends the analysis to compare multiplayer games to singleplayer games on Facebook.
He finds that:
Multiplayer social games such as Warbook and Scrabulous average 11.4% active daily users, a good 30% higher than the average top Facebook app (8.01%). I’m sure if we could actually get engagement, attention, and retention metrics we’d see the same trend. This combined with the relatively high percentage of games represented in the top 25 applications (7 games) would suggest that there is simply a lack of quality, socially-focused games on Facebook.
I wholeheartedly agree with Matt and Nabeel. I think that over the next few months there will be a number of exciting social, multiplayer casual games with good gameplay dynamics built on Facebook and the other social networks as they open up. Teams comprising of experienced game designers and experienced social media/viral marketing experts will be best positioned to create these games. I am actively interested in hearing from such teams.
Making Habbo Hotel a success January 11, 2008
Posted by jeremyliew in casual games, game design, games, games 2.0, gaming, virtual worlds.5 comments
Sulka Haro’s keynote speech on Habbo Hotel at the AGDC conference in September was well summarized by Gamasutra. For people building social games, it is worth reading the whole thing. His perspective is more from that of a virtual world than a game, but it is useful to hear the history of Habbo’s evolution and some of his examples of emergent play. (see previous post on what makes games fun, in particular sections on Games of Simulation and Games of New Stimulation)
His six summary points are:
1. Create something to play with. “Lego are a good example of what you should be building.”
2. Intuitive interaction. “You need to kill the UI. If the users notice there’s a UI it’s probably too complicated.”
3. Set up a mood for play. “This is maybe the hardest part to explain. In the real world, as I mentioned earlier, it’s increasingly hard to play. Just celebrate the fact that people do stuff and don’t punish for failures.”
4. Support user-created goals. “Players know the best.”
5. Shared social setting. “Even when people create the content, let people walk into the room and [use] the stuff. If you want to play, you need to figure out how to play.”
The bonus sixth point, according to Haro, is safety. “The users need to feel as comfortable as possible.” Habbo bans players for passing personal info. “If you construct the game so that people can screw up what other people do, people won’t bother… it’s too difficult to maintain.”
What makes games fun? Part II January 8, 2008
Posted by jeremyliew in casual games, game design, game mechanics, games, games 2.0, gaming.1 comment so far
As a follow up to my post on what makes games fun, another useful framework from Nicole Lazzaro of XEO Design, first presented at GDC in 2004.:
1. Hard Fun: Players like the opportunities for challenge, strategy, and problem
solving. Their comments focus on the game’s challenge and strategic thinking and
problem solving. This “Hard Fun” frequently generates emotions and experiences of
Frustration, and Fiero.
2. Easy Fun: Players enjoy intrigue and curiosity. Players become immersed in games
when it absorbs their complete attention, or when it takes them on an exciting
adventure. These Immersive game aspects are “Easy Fun” and generate emotions
and experiences of Wonder, Awe, and Mystery.
3. Altered States: Players treasure the enjoyment from their internal experiences in
reaction to the visceral, behavior, cognitive, and social properties. These players
play for internal sensations such as Excitement or Relief from their thoughts and
feelings.
4. The People Factor: Players use games as mechanisms for social experiences.
These players enjoy the emotions of Amusement, Schadenfreude, and Naches
coming fromthe social experiences of competition, teamwork, as well as opportunity
for social bonding and personal recognition that comes from playing with others.
Abstract from their white paper is available here
More detail about the people factor (very important for Social Games) is available here
Good stuff.
What makes games fun? January 7, 2008
Posted by jeremyliew in casual games, game design, game mechanics, games, gaming.5 comments
Chris Bateman at Only a Game had a series a while ago on the four elements of play according to Caillois, a noted French sociologist. While somewhat academic in nature, it is still a somewhat useful framework. Bateman notes four styles of (non exclusive) play:
Caillois calls this “agon”. This is the most common type of game, whether the competition is against another player (PvP) or against the environment (PvE), and hinges on the emotion of fiero – personal triumph over adversity. Games of this type appeal the most to hard core gamers. Bateman notes that there is significant room for the level of challenge/competition within a game:
The space that the player ends up within in respect of any given game of agon is determined almost entirely by the strength of the player (determined in part by their own abilities, in part by the game parametrics) relative to the strength of the opposition. Games of hard agon are at the very least evenly matched, and more commonly are biased against the player, so that the player must work even harder to win, and thus achieves an even greater payoff in fiero. Conversely, games of easy agon begin when the player’s strength is weighted higher than the opposition – indeed, these games are arguably at their most fun (and by fun in this case we mean the fun of amusement, not the fun of fiero) when the player is ludicrously overpowered with respect to their opponents. This was surely what made Rampage fun to play when it first came to the arcades, and I assume the recent Hulk game shares something of this feel in its early play.
Caillois calls this “alea”. This is what makes so many people enjoy lotteries and other forms of gambling. An element of chance can create dramatic tension – think of the rich emotions generated when your football team is close to scoring, or if you’re waiting for the river card to complete your flush in Texas Hold’em. An element of chance is often important for casual games, as Bateman notes:
Personally, I have found alea most useful in designing card games and boardgames. This is because aleatory elements inherently reduce the dominance of agon – and I find that there are many players who are put off by directly agonistic (competitive) play. Games like Texas Hold ’em which strike a balance between agon and alea have a wider appeal because failure can be chalked up to bad luck (and not to personal inadequacy) – plus, of course, anyone can win. Indeed, the fact that pure alea gives everyone an equal chance of winning is the reason that we frequently encounter alea in games designed for small children, such as the card game Beggar My Neighbour, or Snakes/Chutes and Ladders, or the aleatory elements in Kirby Air Ride (which was certainly designed to cover a very wide age range).
The rituals of alea have such universal appeal because they are absolutely fair. In a game of pure agon, whomever is more skilled will win every time (all things being equal), but in a game of pure alea anyone can win, regardless of who they are, or what their skills might be. The greater the reward in a game of alea, the greater the appeal – hence the appeal of state, national and international lotteries, despite the fact that the jackpot of even a modest-sized lottery will set a person up for life. The size of the stake the player could lose may intensify the experience, but it is what can be won that entices, whether that reward is money, a unique gift, a nice chocolate or temporary ownership of the flow of the narrative. I believe that harnessing alea might be yet another way to potentially expand the appeal of video games to a much wider audience.
Caillois calls this “mimicry”. Most games have some degree of simulation involved. But games where mimicry is the primary form of play have tended to be successful by drawing in players outside of “hardcore” gamers. Examples include The Sims, Nintendogs and Animal Crossing, all of which have appealed to many more women than have other successful games. Bateman believes that, as a mimicry enhancer, graphics are a key driver for mass market success. He notes:
I strongly believe there is a vast untapped market for games which present mimicry as their core play. …such games can invite the player to play in their own way and at their own pace. They need not place frustrations in the player’s path and force the player to overcome them… The worlds of these games do not need to be as large as a GTA world to support play – instead of large but emotionally empty worlds, they can be smaller but more emotionally invested worldby allowing more player customisation, or by having non-player characters with personality.
…Adult play is simply an extention of child play. …At its core, however, much of play is about imagination, and games of mimicry are tools for enhancing imagination and reducing the degree of suspension of disbelief required. Adults may no longer be able to create spontaneous play out of little plastic figures, but place them in a vivid digital world and suddenly they all become like little children, eager to indulge an imagination often desperate to escape from the confines of the mundane world.
Mimicry is a powerful tool for play, but it is one that until now games have often harnessed only tangentially. When we recognise just how powerful mimicry can be, when we get past merely shackling players to repetitive play by designing addictive play systems, or narrowly defining the world of games as those which supply fiero; when we watch how people play, and what they enjoy, perhaps then we will be ready to allow videogames to be all that they can be.
Imagination is unlimited. Games should be too.
Caillois calls this “ilinx”, or “vertigo”, the momentary destruction of perception. Bateman notes:
It can be the vertigo of speed or of spinning, or it can be the intoxicating allure of petty destruction – of stomping on a sandcastle, for instance.
… destructive ilinx, correlates with the reckless abandon that is allowed by a game such as Grand Theft Auto: San Andreas and its many relatives. I contend that one of the reasons the recent Grand Theft Auto games are so successful at tapping into this side of ilinx is that they are not wholly realistic… The tone of the games is realistic in a certain sense, and certainly they are drawing upon mimicry, but there is an unreal quality. This is expressed in part by the shrewd choice of a non-photorealistic art style, and also by the presence of ‘game-like’ elements in the game world, such as “power up” tokens. This is real, but it is also a game. That empowers the player to, for instance, go on a murderous killing rampage, and laugh as they do it. I do not believe there is anything morally wrong with this, and the unreal quality of the game facilitates this freedom to misbehave.
The joy of ilinx is reckless abandon… it can be the vertigo of speed, or of wanton destruction; it need not be violent, but it is always irrepressible – the temporary abolishment of conscious thought. And video games are a wonderful place to explore this category of play, since one can surrender to ilinx in a game, and nobody gets hurt. Well, at the very least, nobody real. I believe we will see more and more ilinx in videogames over the coming years as we continue to explore the limitless domain of play.
A lot of the new social games are being built by people who do not have a background in game design. Bateman’s work is a useful framework for these new game designers to “check their work” against as they build apps on the Facebook platform and others.
Games 2.0: The Facebook app Zombies is a huge MMOG December 21, 2007
Posted by jeremyliew in asynchronous gaming, casual games, facebook, game mechanics, games, games 2.0, gaming, mmorpg.2 comments
As I mentioned in my last post, you can think of Zombies* and its Monster app brethren (Vampires, Werewolves and Slayers) as an asychronous massively multiplayer online game. It is essentially a PvP dueling game, not unlike duels.com, but much lighterweight. Many of the core elements of a game are already there; experience points, the ability to level up etc. In an interview with Virtual World News back in August, Zombie co-developer Blake Commagere said:
… the game play element is just a new form of interaction.
“Facebook serves different purposes for different people,” he said. “For some people, it’s a business contact site. They probably don’t want zombies on their pages, but a large number are looking for something to do. They’re looking for ways to interact. They use it to message their friends and organize parties. This is just one more way to interact with friends.”
In a random sampling of the users, Commagere found that the app draws slightly more women than men, mostly between 18 and 30. That’s a slightly younger and more female-biased demographic than Second Life or many of the other MMOGs.
In May the average visit time for a user to Facebook was just about 13 minutes, though they visit frequently. So Zombies works as a sort of casual MMO built on the social network. Commagere credits the app’s success to being simple, fun, and tied to a sense of community.
“You can build something for people on social networks,” he said, “but if you don’t leverage the social aspect, it’s just not as interesting. Then you’re ‘Oh, here I am with a widget on my page, all by myself.’ If you can see it on other people’s pages, that’s when users get into it. One of the things that’s compelling in the games we’re making is that you can see ‘Oh, here’s my friend John, and he’s got more points than me.'”
Arguably, the Monsters app are only proto games right now. They certainly derive more of their popularity from their social aspects than from their game design today. Biting someone or attacking their monster is a lightweight way of saying “I’m thinking about you” without having to actually compose a message. It also opens up the opportunity for reciprocity, one of Cialdini’s six weapons of influence). But collectively they have over 18m app installs and 700 daily actives. That is an impressive number for any MMO. As gameplay improves (and it will) you can expect to see daily active rates go up. Scrabulous has shown that with a good game dynamic, a game on Facebook can get up to 30% daily actives which suggests a lot of potential upside.
Watch this space!
* Zombies and the other Monsters apps are part of the Rock You family of Facebook Apps. Rockyou is a Lightspeed portfolio company.
Lightspeed Venture Partners Blog 