Social Gaming Summit coming up in June May 4, 2009Posted by jeremyliew in conferences, games, games 2.0, gaming, social games, social gaming.
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Last years Social Gaming Summit was well received so Charles Hudson, David Sachs and I are doing it again this year. The Social Gaming Summit 2009 is a one day event focused on the intersection of games and the social web. This year’s event will focus on helping social games developers build, monetize, and grow their social games. We’re bringing together the leaders in free-to-play games, social networking, and payments infrastructure for a full day of panels and talks.
The event will be on June 23rd at the Nikko Hotel in San Francisco.
I’m moderating a terrific panel with Mark Pincus from Zynga, Dan Yue from Playdom and Sebastien de Halleux of Playfish, the three biggest games publishers on social networks.
This will be the first time that Playdom has spoken at a conference. We’ve also got the first game conference appearance from Xiaonei (the Facebook of China) and Challenge Games, plus a few speakers that you won’t have heard speak much sharing their game industry expertise.
The rest of the agenda is shaping up really well, and we’re considering adding a separate track or day of practical workshops as well. Here is what it looks like so far:
8:30 AM to 9:20 AM Breakfast and Registration
Join your fellow attendees for a light breakfast and some pre-conference mingling. Register in advance to save money and time at check-in.
9:20 AM Welcome and Opening
9:30 AM Social Gaming Industry Overview and Update
Justin Smith, Inside Social Games
10:00 AM – 10:50 AM Panel: Building Social Games At Scale
Mark Pincus, Zynga
Dan Yue, Playdom
Sebastien de Halleux, Playfish
Moderator: Jeremy Liew, Lightspeed Venture Partners
11:00 AM – 11:50 AM Panel: Social Games – A Platform Perspective
Jason Oberfest, MySpace
Gareth Davis, Facebook
Andrew Sheppard, hi5
Joe Chen, Xiaonei
12:00-1:15 PM Lunch
We’ll have lunches available for everyone from Noon to 1:15 PM. Grab a bite and take advantage of the opportunity to catch up with friends, check your Blackberry, or recharge your batteries.
1:15-2:00 PM Panel: Monetization Infrastructure for Social Games
Erikka Arone, Zong
Adam Caplan, Super Rewards
Rob Goldberg, GMG Entertainment
Renata Dionello, PayPal
2:00-2:45 PM Panel: Customer Acquisition and Retention for Social Games
Jia Shen, RockYou
Anu Shukla, Offerpal Media
Greg Tseng, Tagged
James Currier, WonderHill
Moderator: Sean Ryan
2:45-3:15 PM Afternoon Break
Need caffeine? How about a cookie or a snack? We’ll have refreshments on hand to keep you going through the rest of the day.
3:15-4:00 PM Expert Talks
“Getting the Most Out of Your IP: Extend or Prepare to be Cloned” – David King, (Lil) Green Patch
4:00-4:45 PM Panel: Social Games in the Wild: Living Outside of Social Networks
Matt Mihaly, Sparkplay Media
Andrew Busey, Challenge Games
Jim Greer, Kongregate
4:45 PM Closing Remarks
5:00 PM Reception
After a full day of conference sessions and conversations, join the group for a beverage before you head out for the evening.
Early bird rates are available until May 23rd. If you’d like to come but early bird rates are all gone, use my registration code, JEREMYLIEW, to get a 15% discount.
Hope to see you there.
Future of social payment platforms April 16, 2009Posted by jeremyliew in payments, social games, social gaming, virtual goods.
Inside Facebook reports 35% quarter on quarter growth for social media payment provider platforms. Incentives social network offer platforms such as Offerpal, $uperRewards, Gambit and the like have enabled the phenomonal revenue growth in social games. Payments has always been the friction point for free to play games in the US, and these platforms significantly increase players ability to pay for virtual goods.
The future is bright for these platforms, but there are some clouds on the horixon. Andrew Chen’s blog has a terrific guest post from Jay Weintraub on the likely future of the incentivized social payment platforms. If you’re building games or otherwise monetizing virtual goods and using one of these platforms, go read this post and come back.
Jay points out that incentive marketing has been around a long time, and follows boom and bust cycles where initial advertiser enthusiasm for a new source of leads is dampened when lead quality ends up being poor. I agree with his prognosis that revenue through this channel will come under some pressure in the future but will not go away. Some points worth noting:
1. Because many of the leads are being filtered through at least one intermediary and mixed in with other lead sources, it will take a while before the advertisers figure out what these leads are really worth, so pricing should hold up for a couple of quarters yet.
2. Unlike the free ipod model, the value of the payoff has been reduced by 1-2 orders of magnitude, so far less actions need to be completed (usually only one) before a user gets a payoff. As a result there will be vastly less breakage and vastly fewer unhappy users, [so long as the offers are adequately explained] so the risk of state and federal investigation is much lower this time around.
3. There is a roughly 50:50 split for the payments platforms today between direct payments and offers. Even if the value of offers were to fall in half, this would still mean that revenues would hold up at the 75% level
4. Offers are the gateway drug towards virtual goods purchase. Typical new players split 30:70 direct payments to offers, but hard core players split 70:30. As a result, game publishers will have an incentive to support offers even if margins drop as it teaches players to pay for goods.
Social gaming is a tactic not a category March 25, 2009Posted by jeremyliew in business models, games, games 2.0, gaming, social games, social gaming, viral, viral marketing, virtual goods.
I’ve been blogging a lot about social games over the past couple of years and have been a big proponent of the space. However, over the last few months I’ve started to question whether social gaming is a separate category at all. I now believe that the true category is free to play gaming, and that social gaming is simply a tactic (albeit a very important and differentiating tactic) within this category. Although I’ve been saying this in private a fair bit recently, I brought it up at the VC panel at Gamesbeat yesterday and I hear that it caused a bit of a stir. Rather than being quoted out of context in 140 characters, I thought it would be helpful to explain how I came to this view.
At the most basic level, free to play games (with a digital goods or subscription upsell model) need to focus on only two metrics, Lifetime Player Value (LPV) and Player Acquisition Cost (PAC). If LPV > PAC then you’ve got a business. If not, you don’t. This applies to flash MMOs, virtual worlds, facebook games, asynchronous text based MMOs, client downloadable games, myspace games and a whole host of other games, with the key unifying element being the business model, and the importance of those two statistics, LPV and PAC.
The term “social gaming” has been used in two main, and related, ways. I think that both of these definitions are potentially limiting. The first has been to describe games that are played (and spread) on social networks. The second has been to describe games that spread virally, with a PAC of zero because current players invite new players with a K factor above 1.
Let’s start with games played on social networks. This is a terrific distribution tactic as open platforms and distribution are opposite sides of the same coin, and as I’ve said in the past, in the early stages of a new category distribution is the key driver of success. Free to play gaming is certainly in it’s early stages, with many games having to create demand versus simply fulfilling demand. But there is no reason why these games have to be limited to only social networks, and indeed companies like SGN and Zynga have already started to port their games to other platforms including the iPhone and the open web. Social networks offer an easy starting point for new free to play games because of the large concentration of potential players, but there is no reason for free to play games to stop at social networks.
Now lets address viral growth for games. Obviously, this is a wonderful characteristic. It is the cheapest possible channel for player acquisition as with a PAC of zero, you can make money at any level of LPV. However, once again, there is no reason to limit your player acquisition channels to viral growth. You should acquire new players through any channel where your PAC < LPV. For some game developers this is a religious issue; viral is best and nothing else is acceptable. I disagree with such a fundamentalist approach. If your LPV is high enough to allow you to buy users through advertising, distribution deals, search marketing or any other channel, then you should. Mark Pincus, the CEO of Zynga, has been preaching this approach since early 2008. Here is an excerpt from my blog post from the social games panel that I moderated at the Graphing Social Patterns conference in March 2008:
We next talked about how social games can grow. Viral growth has obviously been the key driver of growth up to this point for all the panelists. Shervin noted that they had seen a strong positive correlation between App Rating and rate of viral growth – high quality games spread faster. Mark talked about the importance of supporting a game with advertising, especially at launch.
One reason that Zynga is the largest social gaming company today is that they have been able to afford to promote their games on both Facebook and Myspace, and have done so aggressively.
Obviously, building social factors into games is increasingly important. Multiplayer is the “user generated content” of games, and social interaction is a key part of that. Furthermore, even if your K factor is less than one, it can be a very important force multiplier on your player acquisition. Buying one player if your K factor is 0.8 means that you will generate 5 new players, and this can dramatically average down your PAC, even if it doesn’t take it all the way down to zero.
In conclusion then, I find the term “social gaming” to be limiting. The best publishers and developers of free to play games will make frequent use of social gaming tactics, but they will not refuse to go beyond social networks and viral channels to grow to their full potential.
I’d be interested to hear what you think.
Social games need endgames September 22, 2008Posted by jeremyliew in endgame, game design, games, games 2.0, gaming, mmorpg, social games, social gaming.
At AGDC last week Bioware’s Damion Schubert spoke about end-game design in MMOs. Massively notes:
Endgame gameplay, elder gameplay, is a mandatory and compelling part of the genre’s equation. In fact, in Damion’s opinion complex elder gameplay exemplifies what makes the massive genre what it is…
In reality, says Schubert, MMOs are generally really easy to play. Comparing the learning curve of an MMO to a single-player game is ludicrous; MMOs are like ‘popping bubble-wrap’ in comparison. This is because of the challenge of tuning leveling to every class and every build. The result is an experience that’s fairly mundane. The real challenge, the ‘worthy experience’ is the endgame encounter.
While endgame may seem like a strange or meaningless thing, it’s actually really important for every player. Even low level players are aware of powerful guilds and raid progression. Damion references the cutscene that happens when Kael is killed and a quest is turned in; this feels, truly, as though the world is advancing and changing. That’s vital for a vibrant community.
The most thing about elder gameplay is that is one of the few things that is actually massive. Massive gameplay is the one thing that this genre of games has to offer.
IGN reports that Schubert considers there to be two forms of endgame, PvP and PvE:
In order to pull players through the sometimes dull leveling process, Schubert says it’s necessary to give an indication of what’s going on at higher levels. In games where the endgame revolves around player versus player territorial control combat, for instance, a good game will let players view a territorial control map. On World War II Online’s site, for instance, the main page prominently displays the line of contest between the two sides and which side, the Axis or the Allies, are pushing forward. It’s, in effect, an advertisement for the dynamic, high level activity that most new players might not necessarily be aware of.
He went on to talk specifically about the advantages and drawbacks of territorial control PvP and PvE raiding. For territorial control, you need a few basics. You need affiliated teams, either pre-set (World of Warcraft, Warhammer Online) or more freeform. You also need a physical location within the game world that players can fight over. Once that’s established, you need to consider the logistics of battle, like far do players need to run to rejoin the battle after death and how long the battles will last. Schubert says that having some way to actually schedule fights is a solid notion, but you should also have a way to specify when that fight will end. Whatever the structure of the PvP conflict, Schubert says it’s a concept that needs to be slowly introduced to players early on, like with the territorial map, to give a player an idea of what the strongest in the game world are up to…
[PvE] Raid encounters are another major form of endgame content, and center around the idea of players working as a team to essentially solve a puzzle. Raid encounters center on boss fights. The draw, naturally, is the loot, but Schubert says there’s also the draw of solving the puzzle of the boss’ attack patterns. Bosses can have a number of different attack routines, from predictable patterns to randomized attacks to the summoning of minions. These types of actions work to engage players in a number of ways. It requires those in the raid to coordinate their positions and movement on the field of battle, manage their health, and also generates different sub-types of player classes outside of the standard tank, healer, and damage dealers.
Gamasutra notes some specific observations about PvP endgames:
“If your endgame is PVP, you need to think about how PVP is introduced to characters at the low levels,” Schubert cautions. “If players decide along the way to the endgame that they don’t like your PVP, they will decide the endgame is not for them.” Argues that you should protect players more at the lower level, so they have a positive PVP experience.
“People don’t pay money to suck. People do not want to pay $15 a month to be the Washington Generals.” This is something he learned when making Shadowbane – “the winners now had lots of resources and the city could thrive, and the losers had nothing. So what happened is eventually the losers stopped logging on, and the winners eventually had nothing to fight.”
“We had one server where one guild was so in control, that they banned a player class so they’d have somebody to fight,” said Schubert. Players woke up in the morning and found that they were “wanted.”
The solution, he says, is to be able to hit a button, in the game (so to speak) to indicate that one group of players have won, and that they can begin again.
Many of the social games on Facebook and on the web today don’t have any endgame at all. The gameplay more or less stays the same no matter how long you play Texas Hold’em, Owned, Lil Green Patch or Bowling Buddies, to name just a few. This is going to create a challenge for long term retention. Even for free to play games, it is your hard core users who pay you the most money. So it will also create a challenge for long term monetization.
The good news for web based games is that there is no need to develop an endgame at launch. You can afford to wait until you have a critical mass of users before developing an endgame as there is no need to solve this problem until you have “elder players”. And since you are a web based game, you can switch on an endgame at any time without having to worry about updating a client.
Often times, endgame play will emerge organically from the users. For example, Fluff Friends endgame play has become more focused on creating elaborate fluff art. Friends For Sale endgame play has become about collecting “sets” of people and other quest like achievements, often challenges set up the players themselves. These social games have developed endgames that are neither PvP nor PvE, but are instead more social in nature.
While it is great when endgame emerges on its own, social game designers can be more proactive in developing endgames to keep their best players engaged, and give their new players something to aspire to.
Inside Facebook has a terrific interview with $uperRewards, one of the two major CPA ad networks for social networks (and increasingly outside of social networks as well). [Offerpal is the other major CPA ad network for social networks]. In the interview the $uperRewards team give some great stats and advice for game designers:
On who to focus on when thinking about monetization:
You should support all kinds of players well, while remembering that your hardcore users will generate 90% of your revenue….
…Also, keep in mind at that a majority of the revenue generated per user is generated early in the lifetime of the users’ interaction with the games. People spend money developing their characters, climbing the leader board, and unlocking new elements of the game. Once their character is strong, they have many prizes, and have unlocked all the levels – naturally there is less desire to complete offers and pay. It is those top guys though that motivate the little guys to climb and thus spend.
On what monetization a game developer can expect:
The core metric we use is dollars per click. We hope our developers can get 25% of their daily active users through a Super Rewards page at some point. Of those, if the economy is balanced correctly, you should see a 40-50% click through rate, and ultimately a net 8-10% conversion rate. Developers get about $1.00-$1.50/conversion for US users, but less for international users. We’re lucky to get $0.06/conversion in China, but we have games operating in Europe and other parts of Asia at $0.25 and up.
So assuming all of a developer’s traffic is US traffic, the developer could see up to $83 per day per thousand DAUs. However, on an average basis across all geographies, we are about half that number. It goes without saying that there is a wide distribution around the average based on quality of app and balance of virtual currency economy.
$83/day x 1/2 x 30 days = ~$1200/mth per thousand DAUs, or $1.2/mth per DAU. That sounds like real opportunity. When Facebook rolls out an API for micropayments, this number will likely go up even further.
Promising numbers for game developers.
Bokardo has an interesting interview with Bryce Glass of Yahoo, about Yahoo’s social design pattern for reputation. Building reputation systems can really help drive high quality engagement on a social media site, but is also fraught with danger and unintended consequences if not done thoughtfully:
What are the biggest hurdles in designing for reputation?
I think it’s probably the number and variety of unintended consequences that little design decisions can have further down the line. I’m fond of the article—so I cite it a lot—but Ben Brown, who founded the dating site Consumating, has a great blog-post about the ‘ill-fated points system’ that they used for that site, and the variety of… um… less-than-ideal behaviors that those incentives gave rise to. Early on, Slashdot struggled with many of these same issues, and they’ve re-jiggered their comment karma system several times through the years.
A big hurdle—and if you can solve this, you’re halfway there to having a well-designed and effective reputation system—is appropriately marrying the incentives that you offer your users to the appropriate set of goals that you have for your community. You want to be sure that you’re rewarding folks for behaving like good citizens, and not just rewarding them for no good reason. (Or for vague and misguided reasons like “to keep them engaged” or “so we can have a leaderboard.”)
Earlier this year, Glass gave a presentation on designing your reputation system at the IA summit outlining eleven different reputation systems:
> Named Levels
> Numbered Levels
> Identifying Labels
> Collectible Achievements
> Top X
> Temporal Awards
> Statistical Evidence
> Peer Testimonials
> User to User Awards
and how to select between them depending on questions including:
> What are your business goals? [Engagement? Promote a specific feature? Acknowledge top contributors? Increase content quality? User Retention?]
> What community spirit do you want to encourage? [Caring? Collaborative? Cordial? Competitive? Combative?] More detail on the competitive spectrum in Yahoo’s Design Pattern Library.
> What motivates your community members?
> Which entities will accrue reputation? [People? Things? Collections of Things?]
> Which inputs will you pay attention to?
> How transparent should the rules be? [More transparency is more likely to affect behavior]
He also notes that reputations should always decay over time to prevent a log jam at the top that can discourage new members and make a community appear stagnant.
Yahoo has done a nice job of categorizing some of the various reputation systems available to social architects and how to think through choosing one. I would highly recommend reading the interview and presentation and reviewing the material in the design library.
How casual MMOs benefit from hardcore players June 18, 2008Posted by jeremyliew in game design, game mechanics, games, games 2.0, gaming, social games, social gaming.
One of the take aways of the social gaming summit last week was that even casual MMOGs need to focus on their hardcore players as that is their source of paying players. David Perry of Acclaim noted in one panel that the players of Dance Online monetize far better than the players of “traditional” MMOGs that Acclaim operates:
As for who’s paying, Perry (Acclaim) expected most microtransactions to come from hardcore MMORPG playerskitting out the avatars with fancy armor and such. Instead, it comes from Dance. The game is a simple dancing activity, but because users spend so much time looking at their avatars, the appearance and identity becomes even more important.
Audition isn’t a casual game, despite the presence of numerous casual markers: short play times, transparent rules, continuous save-free play, an item-based advertising model. Although the rules can be learned in minutes, mastery requires about a month of semi-serious dedication; “pro”-level skills take significantly longer. And, like a standard fantasy-based MMO, if you drop out of regular play, you’ll return to find that all of your friends are 10 levels ahead of you and worlds ahead in ability. Your reflexes can atrophy as quickly as embouchure for a musical instrument.
When you find the beat, however, the feeling is incredible. Your keyboard becomes an instrument through which you “play” a pounding, intense rock song. When you claim the highest score, you slide into the lead dancer position, supported by the other players worshiping at the altar of your groove. Whether you’re playing backup or lead, Audition reaches deep down into the shared performance experience that has driven homo sapiens to make music and dance since the birth of the species. Beat Up, performed well, closely replicates a creative “flow” state that is almost nirvana – if you release thought and embrace the physical pulse of the music, you’re carried along in a fast and furious musical flow that you share with your fellow performers. The game’s mechanics encourage this mindset with visual cues and flourishes that reward a steady, flawless performance; you achieve “beat up” status by sustaining 100+ perfect “moves.” Once I’d tasted a little Beat Up success, there was no going back.
I am a big fan of causal MMOs branching out beyond the fantasy, FPS and sci fi themes towards genres that have potential for much broader, mass market appeal. As I’ve noted before, there is increasing evidence that women drive viral growth more than men do, so if you want to see viral growth in games, it makes sense to make games that will appeal broadly to “non gamers”. Games like Popomundo, Parking Wars and Friends For Sale all do this well. (Friends for Sale is a Lightspeed portfolio company)
Another important lesson to take away from the review is that real world context can have an impact on gameplay:
When I first started playing, I was convinced these high-level hot stepper kids had something I fundamentally didn’t. This is partially true: They did have something I didn’t, and not just endless patience or time to spare – they knew the songs.
This actually makes a significant difference in your performance. Hardcore Audition players identify desirable songs by their speed and difficulty, but a significant number of the game’s “mainstream” players actively seek music that they already listen to outside the game. (And it works both ways; players have reported purchasing music they first heard in Audition.)
…Once I started playing Audition, however, a new aural landscape opened up before me. Rather than semi-sullenly tuning out environmental music at the mall, I started to recognize bands and individual songs. And because I associated them with the feelings of accomplishment and socialization I absorbed in Audition, I actually enjoyed hearing them. Whereas I had actively disliked – to put it mildly – the repetitive beat and high-pitched vocals in Avril Lavigne’s “Girlfriend,” after mastering it in Audition I found myself tapping along with it on the radio. Audition is, among other things, an as-yet unmatched music marketing engine.
I think we’ll see more of both of these trends as social gaming continues to evolve. I’d love to hear examples from readers of games that are leading these trends.
Notes, video and commentary on the Social Gaming Summit June 16, 2008Posted by jeremyliew in asynchronous gaming, business models, casual games, game design, game mechanics, games, games 2.0, gaming, mmorpg, social games, social gaming, user generated content, virtual goods, virtual worlds.
The Social Gaming Summit was quite a success on Friday. Over 400 attendees seemed to enjoy the sessions based on the high proportion of people in sessions (vs in the lobby) and the fact that even the last session, that ended at 6pm on Friday evening, was very well attended.
The attendee list was a good mix of game developers and publishers, with people coming from both the gaming side and the social media side. Most of the attendees with gaming backgrounds came from casual gaming, web based gaming or MMOG backgrounds. With the notable exception of EA, there were few representatives from the giants of the console space.
Although each of the topics covered different topics, it was clear that monetization was top-of-mind for all panelists as the discussion on most panels eventually turned to this issue.
I (Jeremy Liew) moderated the first session, on What Makes Games Fun, featuring game design thought leaders Amy Jo Kim, Nicole Lazarro and Ian Bogost, plus John Welch of Playfirst, the company behind one of the most popular casual game ever, Diner Dash.
The discussion was wide ranging and covered Nicole’s framework for generating emotion in games and the four types of fun and Amy Jo Kim’s five game mechanics.
There was excellent discussion about how fun, addictiveness and business models can either collide or work together, with in depth discussion of two games in particular, Pack Rat and Parking Wars.
Pack Rat was lauded as an example of a game that did a masterful job of creating addictiveness through game mechanics, and a game that had a natural digital goods/service business model baked into it. But some panelists questioned whether the “grind” without real “payoffs” at different levels could burn players out. In contrast, Diner Dash had real changes in game dynamic and strategy as players level up (e.g. when Flo gets the coffee maker at level 4, it changes the winning strategy) that made leveling up more meangingful and rewarding.
Parking Wars was pointed to as a highly social game with a genre matching to the mass market that let players “play slight variations of themselves” where they could explore slightly nefarious behavior in a safe environment. But “winning” in Parking Wars forced activity to the edges of the social network, instead of to the core, so the “points” game mechanic ended up working against the “fun”.
UPDATE: Virtual worlds has an excellent writeup of the What Makes Games Fun panel.
The second session was focused on Casual MMOs and Immersive Worlds, with Joey Seiler from Virtual World News moderating representatives NeoPets, Nexon, K2 Networks and Gaia.
One of the key questions was how to get free to play users to open their wallet. Gamasutra covered this panel in detail and noted:
Added Kim (Nexon): “A lot of people think they can make money off of casual games where people play a couple of hours a week. I don’t believe that. When people get engaged with the social experience then they’ll buy items. You need to understand the psychology.”
Reppen (Neopets) continued: “For us, it’s all about a sense of ownership that our audience has. There’s a real sense that it’s their game… The identity component to virtual worlds is so important, but there’s so many other things going on in the meta games around earning points, acquiring wealth, shopping and customizing and creating your own experiences… It’s part of a mix.”
In other words, even for casual MMOGs, you monetize the hardcore players who tie their identity into the game. Erik Bethke (GoPetsLive) said the same thing at this years GDC previously in explaining why he applies game dynamics to make virtual worlds more addictive.
After lunch Andrew Chung from Lightspeed moderated a panel on Asynchronous Games on Social Networks with the CEOs of the companies behind many of the top games on Facebook, including Friends for Sale, Zombies, Vampires, Warbook, JetMan and (fluff)Friends.
Inside Social games took live notes from the panel. One interesting counterpoint in response to the question, “How do you move people down the spectrum to make them more engaged and hard core?”:
Blake (Zombies, Vampires etc)- There is always going to be some subset of your userbase that’s never going to play more than their 30 minute lunch break, because that’s all the time they have. Don’t inundate users with too much experience at the beginning, gamers hate to read, I’ve never read a game manual in my life.
Siqi (Friends For Sale)- I think there’s a lot to learn from traditional MMO design, things like levels. If you get to the next level, you get this new shiny thing. It makes the game more complicated, but it works. Our hardest core users use more synchronous features.
Shervin (Warbook, Jetman, etc) – The first generation of social games were incredibly simplistic, and the platform was so viral, that it was a lot easier for apps to grow. But it behooves all of us to invest in content. I’m staying up late at night building social games 2.0, games with richer content, deeper stories, much better user experiences. It’s going to become harder for independent developers. I can’t talk about the games we’re working on, but you can look at Playfish. Their engagement levels are high and they’re growing faster than those that have come before.
In other words, games need to be easy to learn, but hard to master.
Next up was Dean Takahashi of VentureBeat moderating a panel on User Generated Games in Social Networks and Virtual Worlds. The speakers were from IMVU, Dogster, Three Rings (Puzzle Pirates, Whirled and Bang Howdy) and Habbo.
Virtual Worlds News has coverage of the panel and noted that:
In IMVU, said Rosenzweig, creators “do what they do because it’s cool, but they like making credits” by selling the items in world. That can then be cashed out through IMVU, which leads to 90% of its revenue, taking a cut while transfering IMVU credits to real world dollars. That user attitude is true of Dogster and Catster as well–users don’t get a cut of the money generated by creating games around their items and boosting activity. They just enjoy creating and sharing.
In other words, social game players generate content for love, not for money. But if there is money there to be had, they don’t mind taking some of that too! Last month Chris Alden noted the same experience in the blog economy.
UPDATE: Worlds in Motion also has a writeup of this panel
After a short break for cookies, the attendees reconvened to hear Brandon Sheffield of Gamasutra moderate a panel about Building Communities and Social Interaction In and Around Games, featuring the leaders of Kongregate, Zynga and Addicting Games, along with noted social architect and game designer Amy Jo Kim.
The discussion centered on the desire that many users had to communicate with each other, and how games often served as an easy way to break the ice and provide topics that made it easy to start a conversation. I haven’t found any coverage of this panel online unfortunately.
The final session of the day was focused on Monetization and Business Models for Social Games. My partner Ravi Mhatre moderated the panelists, including the leaders of Mochi Media, Sparkplay Media, Stardoll and Acclaim. This was a fantastic panel. Virtual Worlds News has great coverage.
Although most of the discussion was focused on the four models of advertising, subscription, digital goods and retail, David Perry noted that there are by his count 29 business models for games.
On the mix between advertising and virtual goods, the panel mostly agreed that virtual goods was the primary revenue stream but that advertising was an important secondary stream:
“Microtransactions and advertising go perfectly togetehr,” said Miksche. “Microtransactions drive our business, but we will never have 100% of our users wanting to pay for that. Advertising is a good way to monetize that remaining X percent.”
There was some good discussion about the tension between game balance and letting players buy powerful items in the games. Several panelists noted that self expression was a key driver of virtual goods sales:
As for who’s paying, Perry (Acclaim) expected most microtransactions to come from hardcore MMORPG playerskitting out the avatars with fancy armor and such. Instead, it comes from Dance. The game is a simple dancing activity, but because users spend so much time looking at their avatars, the appearance and identity becomes even more important.
That works well for Stardoll, a fashion-themed site, especially with trends that match the real world…
“We’re One-Click Dressing,” said Miksche (Stardolls). “You come to the site and instantly start dressing. For our users, young girls, that’s very important–instant gratification.”
For those who couldn’t attend, UStream.tv hosts video from the social gaming summit.
Andrew Chen’s blog also has his takeaways from the social gaming summit.
I’ve pulled together all the coverage I could find, but if there were additional posts, please let me know in comments.
Great agenda for the Social Gaming Summit on Friday June 12, 2008Posted by jeremyliew in conferences, digital goods, game design, game mechanics, games, games 2.0, gaming, social games, social gaming, virtual goods, virtual worlds.
I’m very excited about the Social Gaming Summit on Friday that I’m co-producing. The program looks fantastic:
10:00am What Makes Games Fun?
» Erik Bethke – CEO, GoPets
» Dr. Ian Bogost – Founding Partner, Persuasive Games
» Nicole Lazzaro – President, XEODesign, Inc.
» John Welch – Co-Founder, President & CEO, PlayFirst (Diner Dash)
» Me (Moderator)
11:00am Casual MMOs and Immersive Worlds
» Daniel James – CEO, Three Rings (Puzzle Pirates)
» Kyra Reppen – SVP and GM, NeoPets
» Min Kim – Vice President of Marketing, Nexon America
» Patrick Ford, VP Marketing and Community Development, K2 Networks
» Joey Seiler – Editor, Virtual Worlds News (Moderator)
1:30pm Asynchronous Games on Social Networks
» Siqi Chen – Founder, Serious Business (Friends for Sale)
» Blake Commagere – Founder and VP Engineering, Mogad (Monsters apps – Zombies, Vampires etc)
» Shervin Pishevar – CEO, Social Gaming Network
» Mike Sego – Developer, (fluff)Friends
» Andrew Chung – Principal, Lightspeed Venture Partners
2:30pm User Generated Games in Social Networks and Virtual Worlds
» Jeremy Monroe – Director of Business Development, Sports & Entertainment, North America, Sulake Inc. (Habbo Hotel)
» Ted Rheingold – Founder, Dogster and Catster
» Cary Rosenzweig – President and CEO, IMVU
» Craig Sherman – CEO, Gaia Online
» Dean Takahashi – Writer, Venture Beat (Moderator)
4:00pm Building Communities and Social Interaction In and Around Games
» Jim Greer – CEO, Kongregate
» Amy Jo Kim – CEO, Shufflebrain
» Mark Pincus – Founder and CEO, Zynga Game Network
» Dave Williams – SVP, Shockwave, AddictingGames
» Brandon Sheffield – Writer, Gamasutra (Moderator)
5:00pm Monetization and Business Models for Social Games
» Jameson Hsu – Co-Founder and CEO, Mochi Media
» Matt Mihaly – CEO and Creative Director, Sparkplay Media
» Mattias Miksche – CEO, Stardoll
» David Perry – CCO, Acclaim
» Ravi Mhatre – Managing Director, Lightspeed Venture Partners (Moderator)
Attendence is limited to 400 and it looks like it is going to be a full house. Hope to see some readers there!
Social Gaming pwns the industry June 6, 2008Posted by jeremyliew in games, games 2.0, gaming, social games, social gaming.
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I have a guest post on Techcrunch about social gaming that covers some of the trends I’ve blogged about here as well. Check it out.