Speaker 1: Welcome to tech Stuff, a production from iHeartRadio. He there,
Speaker 1: and welcome to tech Stuff. I'm your host, Jonathan Strickland.
Speaker 1: I'm an executive producer with iHeart Podcasts and how the
Speaker 1: tech Are you well. Welcome to our continuation on the
Speaker 1: topic of games as a service or live service games.
Speaker 1: If you missed Monday's episode, I recommend you go and
Speaker 1: check that one out first. But in general, we're talking
Speaker 1: about the tendency for video game developers to move toward
Speaker 1: generating games that have a long tail for revenue, whether
Speaker 1: that's setting up a subscription model or micro transactions or
Speaker 1: something else. I left off last time alluding to how
Speaker 1: some developers and publishers started to require gamers to have
Speaker 1: a persistent Internet connection for their games. That's where we're
Speaker 1: going to pick up today. These are games that would
Speaker 1: require players to have an Internet connection even if the
Speaker 1: game they were playing otherwise had no online component to it,
Speaker 1: like no multiplayer, nothing else. So this was all part
Speaker 1: of a DRM strategy or digital rights management. Still very
Speaker 1: much something that's happening today, but you know, a decade ago,
Speaker 1: this was kind of a new idea. Back in twenty eleven,
Speaker 1: Ubisoft released a PC version of the game from Dust
Speaker 1: from Dust in case you're not familiar with it, I wasn't.
Speaker 1: This is not one of the Ubisoft titles that I've played,
Speaker 1: but anyway, it's a game in which you play is
Speaker 1: kind of a god. You're manipulating landscapes so that your
Speaker 1: worshippers can establish communities and prosper, kind of like Populous
Speaker 1: if you remember those old games. The PC version of
Speaker 1: the game required an Internet connection in order to even launch,
Speaker 1: but the game itself was a single player experience, so
Speaker 1: if you didn't have an Internet connection, the game would
Speaker 1: not even start. You'd be Soft apparently posted a message
Speaker 1: at some point that said you could play the game
Speaker 1: with on Internet connection at least after the first play session,
Speaker 1: where you would register your copy. But according to sites
Speaker 1: I was looking at various media outlets tested this and
Speaker 1: found that not to be true. So the whole purpose
Speaker 1: of this particular practice was to cut back on piracy
Speaker 1: and to require players to prove that they were playing
Speaker 1: on an authorized copy of the game. That you're presumed
Speaker 1: guilty until you prove yourself innocent. In other words, now,
Speaker 1: as I mentioned in the previous episode, one thing game
Speaker 1: companies really want to eliminate is the video games after market.
Speaker 1: That's bad for gamers because you know, sometimes I remember
Speaker 1: doing this myself. You go to a game store and
Speaker 1: you look at the used games and say like, well,
Speaker 1: I can't really afford to buy this brand new, but
Speaker 1: I can buy a used copy and experience this game. Well.
Speaker 1: Game companies hate that because they don't make money on
Speaker 1: any subsequent sales of used copies. They only make money
Speaker 1: if you're buying the new ones. So moving to a
Speaker 1: digital realm where digital distribution becomes the norm as opposed
Speaker 1: to physical media, that would be a huge benefit to
Speaker 1: the video game companies for lots of reasons. It cuts
Speaker 1: down on production costs because you don't actually have to
Speaker 1: make anything. Physical cuts you know, you don't have to
Speaker 1: ship anything, you don't have to have warehouses to store inventory.
Speaker 1: There are a lot of things that it solves. But
Speaker 1: it opens up the possibility of piracy. And there's not
Speaker 1: a publisher out there, no matter what kind of media
Speaker 1: we're talking about, that isn't up in arms about the
Speaker 1: possibility of piracy, not even if piracy is even happening.
Speaker 1: We've heard in the past about how companies have argued
Speaker 1: they have lost millions or even billions of dollars due
Speaker 1: to piracy. Although this is all always a difficult argument
Speaker 1: to make because, as I have said many times, you
Speaker 1: can't point to piracy and say that's the same thing
Speaker 1: as lost sales because there's no guarantee that the people
Speaker 1: who pirated the stuff would have purchased it legitimately. Otherwise
Speaker 1: you can't make that argument. But it's obvious that piracy
Speaker 1: could have a massive impact. So this is particularly understandable
Speaker 1: with the digital landscape. It is incredibly simple to make
Speaker 1: copies of stuff. It's almost effortless to do so, right, Like,
Speaker 1: you could just make a copy available on something like
Speaker 1: a peer to peer sharing network or a server or something,
Speaker 1: and that's all there is to it. You don't have
Speaker 1: to like sit down and transfer tapes to disc and
Speaker 1: all that kind of stuff. So companies have spent a
Speaker 1: lot of time and effort developing strategies to prevent people
Speaker 1: from being able to do that. The problem for gamers
Speaker 1: is that these measures often create a negative experience for
Speaker 1: people who have purchased a legitimate copy of the game,
Speaker 1: and if anything, that kind of actually encourages more piracy
Speaker 1: attempts because people will try to find a way to
Speaker 1: strip DRM out of games so that they can have
Speaker 1: an unfettered gaming experience. Like when the experience of playing
Speaker 1: a legitimate copy of a game is worse than playing
Speaker 1: a pirated copy, people are going to start pirating more.
Speaker 1: It's been argued many times that DRM has made piracy
Speaker 1: worse rather than prevented it. Anyway, Ubisoft's move was a
Speaker 1: pretty rough one, and to say that people were upset
Speaker 1: is putting it mildly. Though they might be more upset
Speaker 1: if From Dust had actually been a more popular game.
Speaker 1: I don't know if they were like diehard From Dust fans.
Speaker 1: I honestly had not heard of this game before. Diablo three,
Speaker 1: which inarguably had a much higher profile than From Dust,
Speaker 1: had similar criticisms thrown its way. Diablo three is a
Speaker 1: game from Blizzard, and the Diablo franchise has been a
Speaker 1: really popular one over the years. It's also no stranger
Speaker 1: to play or frustration. There have been some pretty notable
Speaker 1: outcries from players relating to Diablo. Like From Dust, Diablo
Speaker 1: three required and always on connection because of DRM. But
Speaker 1: unlike From Dust, Diblo three also had a few benefits
Speaker 1: that derived from that persistent online connection, stuff like you know,
Speaker 1: leader boards and that kind of thing. So you could
Speaker 1: argue there was at least some additional value for the
Speaker 1: player for connecting online for each session, you know, beyond
Speaker 1: just being able to boot up the game and play
Speaker 1: it in the first place. But people were still upset
Speaker 1: that a single player game would require an Internet connection
Speaker 1: at all. And I get it. You know, I've lived
Speaker 1: in places that have had really spotty internet, and I've
Speaker 1: also taken games with me on trips where I've gone
Speaker 1: to places where there was no Internet connection at all.
Speaker 1: It is beyond irritating when you fire up a game
Speaker 1: that you have paid for, perhaps even paid full price for,
Speaker 1: and because of a lack of Internet connection, you can't
Speaker 1: launch it because the game just assumes you're a nasty
Speaker 1: little thief. Like again, you are presumed to be guilty.
Speaker 1: It's pretty insulting after you've dropped like sixty or seventy
Speaker 1: dollars on a title. Anyway, this whole thing is a
Speaker 1: bit of a tangent from games as a service. It
Speaker 1: is related, I would argue, but it's not directly connected
Speaker 1: to it. I guess the persistent internet connection element, however,
Speaker 1: would become a component for a lot of these live
Speaker 1: service games. It's what enables companies to create a stream
Speaker 1: of updates and content releases that keeps players engaged in
Speaker 1: particular games, and it opens up opportunities for these companies
Speaker 1: to make more money. Now. In that last episode, I
Speaker 1: also talked about MMO games that's massively multiplayer online games.
Speaker 1: I specifically talked a lot about mmoorpgs. The RPG stands
Speaker 1: for role playing game. Just in case you're not familiar,
Speaker 1: Nearly all of the early mmoorpgs worked on a subscription
Speaker 1: model in which gamers would have to purchase a copy
Speaker 1: of the game. You buy a copy, but then you
Speaker 1: would also have to pay a recurring monthly fee to
Speaker 1: access the online servers that hosted the game. Typically, the
Speaker 1: purchase would come with a certain number of months added
Speaker 1: in to or bundled in with that price, so that
Speaker 1: you're not, you know, paying fifty bucks for a game
Speaker 1: and then immediately having to pay ten or fifteen dollars
Speaker 1: a month to play it. But eventually, you know, even
Speaker 1: if you didn't mind the fee, you would potentially run
Speaker 1: up to a problem where you have experienced kind of
Speaker 1: like everything the game has to offer. So at that point,
Speaker 1: a company might see subscriber numbers start to drop off,
Speaker 1: and the costs of running servers so that you know,
Speaker 1: remaining players could continue to access the game would continue, right, like,
Speaker 1: the cost of supporting that game doesn't go away just
Speaker 1: because some people are leafing. So this meant that there
Speaker 1: was an incentive for companies to come up with ways
Speaker 1: to keep players staying on the game for longer, to
Speaker 1: keep them gauged, so they would start to generate new
Speaker 1: content in order to do that. Now, some mmrpgs would
Speaker 1: require players to spend a decent chunk of change to
Speaker 1: access that new material. So World of Warcraft, for example,
Speaker 1: has had nine major expansion packs released since the game
Speaker 1: first debuted, and these expansions typically introduce a lot of
Speaker 1: new content. Sometimes it actually changes existing areas in the
Speaker 1: game dramatically at times, and this reflects massive story elements
Speaker 1: that unfold in the world's narrative. These expansions would mean
Speaker 1: that two different players could have wildly different experiences within
Speaker 1: the game, Like if one person had purchased and installed
Speaker 1: an expansion and the other one hadn't, there's going to
Speaker 1: be a gap in those experiences. But typically these gaps
Speaker 1: would only kick in at higher character levels in the
Speaker 1: game that you couldn't even access these new areas until
Speaker 1: you had reached a certain level, So until that point
Speaker 1: there wouldn't be a whole lot of difference between the
Speaker 1: two experiences. However, beyond that, the person who had the
Speaker 1: expansion would be able to experience areas and content that
Speaker 1: the other one would not have access to and could
Speaker 1: not get to. The expansions themselves would cost extra to purchase,
Speaker 1: so you would have to buy the expansion, and then
Speaker 1: at that point you just had the normal subscription fee
Speaker 1: kick in after whatever grace period there might be unless
Speaker 1: whatever game you're playing switched to a free to play mode,
Speaker 1: and typically that means that players can access some of
Speaker 1: the game for free, but then eventually they hit a
Speaker 1: content paywall that will require a subscription in order for
Speaker 1: them to access it. I've played a few games where
Speaker 1: it did this, where you could walk around and then
Speaker 1: you might find like a gateway, but the gateway itself
Speaker 1: would be inactive to you because you would have to
Speaker 1: pay a subscription before or you would be allowed to
Speaker 1: access it. World of Warcraft actually made this transition to
Speaker 1: free to play back in last year in twenty twenty
Speaker 1: three and allowed players to create characters and level them
Speaker 1: up to level twenty before they hit a paywall, and
Speaker 1: at that point it's time to part with fifteen dollars
Speaker 1: per month. Or you can opt to pay for several
Speaker 1: months in advance, which reduces the cost per month that way.
Speaker 1: Or you can use something they call game time, where
Speaker 1: you could just pay for sixty days of access and
Speaker 1: it doesn't become a recurring subscription. So maybe you've been
Speaker 1: playing for a while and you dropped off, So then
Speaker 1: you pay, you know, for game time, you get sixty
Speaker 1: days access, you play for two months to try and
Speaker 1: access of some of the content that you hadn't seen already,
Speaker 1: and then once that time is over, you could just
Speaker 1: choose to walk away or you know, subscriber, whatever you
Speaker 1: want to do. In more recent years, we've seen the
Speaker 1: industry at large put more emphasis on these ongoing revenue
Speaker 1: generation models. A Grand Theft Auto of five, which sold
Speaker 1: a mind boggling one hundred ninety five million units since
Speaker 1: it came out way back in twenty thirteen according to
Speaker 1: Statistic Anyway, that's a great example, according to game Ramp.
Speaker 1: According to game Rant, GTA five had a budget of
Speaker 1: two hundred sixty five million dollars for development. That is insane.
Speaker 1: In fact, according to the numbers, it was even bigger
Speaker 1: than the largest budgeted film for twenty thirteen. That film
Speaker 1: was The Loan Ranger, which bombed, but The Loan Ranger's
Speaker 1: budget was estimated to be around two hundred and twenty
Speaker 1: five million dollars. So GTA five cost forty million dollars
Speaker 1: more in budget than the largest budgeted film of twenty thirteen.
Speaker 1: That is an incredible number to think about, and then
Speaker 1: you think, well, making that money back, making a profit,
Speaker 1: that's really challenging. However, for Rockstar, that investment is paid
Speaker 1: off because GTA five has made around eight and a
Speaker 1: half billion dollars billion with a B since it was
Speaker 1: released in twenty thirteen. And again, that number is just
Speaker 1: it's so huge as to be unimaginable to me. And
Speaker 1: a large part of that revenue is thanks to the
Speaker 1: online component, fittingly called GTA Online. It wasn't ready when
Speaker 1: the game initially launched, but GTA Online would become an
Speaker 1: enormous powerhouse for Rockstar in time. Now, the access to
Speaker 1: the online component is free, or at least it's free
Speaker 1: on top of whatever fee a gamer might be paying
Speaker 1: in order to access online services through their respective platforms,
Speaker 1: because both Xbox and PlayStation have done that right where
Speaker 1: you have to pay a certain amount in order to
Speaker 1: be able to tap into the online capabilities of those consoles.
Speaker 1: There are options to spend real world money in GA
Speaker 1: Online to unlock in game content. You can choose to
Speaker 1: just play it for free. You don't have to spend money.
Speaker 1: You can opt to earn stuff in the game, but
Speaker 1: it's going to be at a rate that is really slow,
Speaker 1: slow enough that you might find yourself tempted to spend
Speaker 1: some real world cash to speed things up a bit,
Speaker 1: purchasing a so called Shark card with real world money
Speaker 1: in Jet's virtual cash into your GTA online character's bank account,
Speaker 1: or as Rockstar has put it, quote cash is king
Speaker 1: in this town. Solve your money problem and help get
Speaker 1: what you want across Los Sentos and Blaine County with
Speaker 1: the occasional purchase of cash packs for Grand Theft Auto
Speaker 1: Online end quote. But just to cover their butts and
Speaker 1: to emphasize that maybe you should practice a little restraint,
Speaker 1: the company also adds, quote spend wisely. Cash therapy is
Speaker 1: fleeting in the quote, and I guess say I'm impressed
Speaker 1: with help blatant. Rockstar is on the whole spend money,
Speaker 1: need to make our game more fun for you messaging.
Speaker 1: In fact, we'll touch on that more in just a moment,
Speaker 1: but first let's take a quick break to thank our sponsors. Okay,
Speaker 1: before the break, we were talking about GTA Online and
Speaker 1: the incentive that Rockstar has created to convince players to
Speaker 1: spend real world cash on in game currency. That virtual
Speaker 1: cash in the game is what gets you access to
Speaker 1: some of the fanciest toys that are available. That might
Speaker 1: be a suite headquarters where you can hang out with
Speaker 1: your buddies. It might be brand new vehicles that you
Speaker 1: can tool around in. It could be all sorts of
Speaker 1: different stuff. And you can even purchase a version of
Speaker 1: GTA Online that's separate from the GTA five game if
Speaker 1: all you want to do is just play the online component,
Speaker 1: and that'll save you like twenty bucks in upfront costs
Speaker 1: at that point. Now, rock Stars being a bit cheeky
Speaker 1: in its descriptions of this, but I feel the company's
Speaker 1: messaging is shining a light on one of the real
Speaker 1: challenges of live service games. At least in the minds
Speaker 1: of some gamers, and that's making sure that players don't
Speaker 1: walk away with the feeling that they have to keep
Speaker 1: paying in order to make a game be fun. Like
Speaker 1: that's a terrible realization to come to. Right You're playing
Speaker 1: a game and you're like, well, this isn't fun. I'm
Speaker 1: not enjoying this, and then you realize, oh, the fun
Speaker 1: stuff has been locked behind a paywall, so I have
Speaker 1: to pay money if I want to actually enjoy this experience.
Speaker 1: There is a very delicate line between providing new experiences
Speaker 1: and content for players that they feel is worth paying
Speaker 1: for and holding back on the best stuff of the
Speaker 1: game unless the players cough of the dough. If players
Speaker 1: start to feel that they're being milked of cash just
Speaker 1: because they want to have fun playing a game, they
Speaker 1: get resentful for really good reason. I mean, games are
Speaker 1: supposed to be entertaining. That's why they exist. So if
Speaker 1: you get a feeling that a game is not entertaining
Speaker 1: unless you keep paying money to the developer, that just
Speaker 1: feels like you're being exploited and taken advantage of. That's
Speaker 1: not fun. Rockstar has continued to develop lots of content
Speaker 1: for GTA online, which means that it's also important for
Speaker 1: them to continue to generate a stream of revenue because
Speaker 1: without the revenue, there's no incentive for Rockstar to spend
Speaker 1: assets to build stuff for the game. You would just
Speaker 1: have a static world and it would only exist for
Speaker 1: as long as Rockstar was willing to pay for the
Speaker 1: maintenance of servers. Right, So you have to have that
Speaker 1: ongoing revenue stream. And we don't yet have GTA six
Speaker 1: available to us. It is in development and we've seen
Speaker 1: some like first looks and stuff, but the general expectation
Speaker 1: is that we're going to see such a similar approach
Speaker 1: GTA six that embraces long tail revenue streams. Hopefully they'll
Speaker 1: be incorporated in a way that doesn't feel like rock
Speaker 1: Star is trying to exploit its fan base. But without
Speaker 1: that long tail, there's no reason to spend the ginormous
Speaker 1: amounts of money needed to build out a game with
Speaker 1: the scope of GTA. There's no reason to spend two
Speaker 1: hundred and sixty million dollars making a game because you'd
Speaker 1: never make that back. So you can argue that if
Speaker 1: players reject the GTA online model, game studios would have
Speaker 1: no option but to scale way back on games and
Speaker 1: cut budgets drastically in order for the business model to
Speaker 1: make sense. Would that be a bad thing, Not necessarily,
Speaker 1: but it would mean that the games we would get
Speaker 1: would be less ambitious in scope, right, We wouldn't have
Speaker 1: these enormous open world games with incredible depth and detail
Speaker 1: to them. I think of things like games out of
Speaker 1: Bethesda where you're looking at Fallout or Elders Roles. These
Speaker 1: are huge, epic worlds. Whether you enjoy them or not
Speaker 1: is up to your subjective tastes, but it's undeniable that
Speaker 1: there's a huge amount of work that goes into them,
Speaker 1: and those things aren't possible if you can't find these
Speaker 1: ways to generate long tail revenue for the most part,
Speaker 1: because who's gonna be able to keep that and make
Speaker 1: it sustainable. On the flip side, some people would argue, well,
Speaker 1: games have gotten so large in scope that it's overwhelming
Speaker 1: and stops being fun, And that's a different conversation. Again,
Speaker 1: I think it comes down to personal preference. But maybe
Speaker 1: then you'd say, well, I think it might be a
Speaker 1: good thing for the video game industry to kind of
Speaker 1: check itself a bit and take a step back and
Speaker 1: perhaps not tackle these ever growing projects that get increasingly
Speaker 1: more complicated and expensive. That's the real rub of it.
Speaker 1: Even for teams that just want to build a single
Speaker 1: player experience, to do that on a triple A scale
Speaker 1: requires a level of investment. It's just plain hard to
Speaker 1: profit from if it's just a single purchase model. If
Speaker 1: all you're doing is making an incredibly rich, detailed, enormous
Speaker 1: first single player game and then releasing it and just
Speaker 1: selling the one copy and that's it, you would need
Speaker 1: to sell so many copies of that game to return
Speaker 1: something to that level of investment that it's a huge risk.
Speaker 1: Ongoing revenue streams, either from subscriptions or micro transactions or whatever,
Speaker 1: are way more attractive. The good developers will build that
Speaker 1: into their plans for a steady stream of new content
Speaker 1: adding value to what hopefully is already a good game.
Speaker 1: Bad developers will hope they can ring as much cash
Speaker 1: out from players as they can before the gig is
Speaker 1: up and you know, everyone calls them out on their BS.
Speaker 1: Many live service games have adopted a seasonal structure for
Speaker 1: their content. Games like Sea of Thieves, Fortnite, Fall Guys Deep,
Speaker 1: brought Galactic Dead by daylight. Tons of games use a
Speaker 1: seasonal model. Some of these games introduce new content during
Speaker 1: a season with the promise that once the season is over,
Speaker 1: players will no longer be able to acquire the stuff
Speaker 1: that had been introduced. And this creates a sense that
Speaker 1: if you allow your subscription to lapse or you don't
Speaker 1: pay up to access this new season, you're going to
Speaker 1: be missing out and you won't ever be able to
Speaker 1: get whatever stuff was introduced at that time. So the
Speaker 1: fomo that fear of missing out is strong with seasonal approaches. Now,
Speaker 1: let's talk about another specific subset of micro transactions and games.
Speaker 1: This is one that has drawn criticism and scrutiny from
Speaker 1: regulators around the world, and that would be lootboxes. Some
Speaker 1: games let players buy in game items directly. Right, maybe
Speaker 1: you have your eye on a particular outfit in a
Speaker 1: game and you think that looks really snazzy. I really
Speaker 1: want to have my character wearing this outfit, and maybe
Speaker 1: the game allows you to actually PLoP down real world
Speaker 1: dollars or whatever currency you are working in so that
Speaker 1: your in game character can look amazing. That's great. You
Speaker 1: know the people who want to do that can do that,
Speaker 1: and everyone else can just move along. But what if
Speaker 1: instead you can only spend money for the chance of
Speaker 1: getting that outfit, and there's no guarantee that that's what
Speaker 1: you're going to get. That's what loot boxes represent. They
Speaker 1: are in game items that represent a random or pseudo
Speaker 1: random bit of content. So players spend real world money
Speaker 1: not on a specific thing, but on the equivalent of
Speaker 1: a pull on a slot machine. So if the player
Speaker 1: is incredibly lucky, the loot box will reveal that they've
Speaker 1: been awarded the very thing that the player wanted, but
Speaker 1: the odds are not very good. You could argue this
Speaker 1: whole model is heavily inspired by gambling, particularly on stuff
Speaker 1: like slot machines. So why do folks play slot machines.
Speaker 1: They play because the machines represent the possibility of a payout,
Speaker 1: and a lot of machines are designed so that they
Speaker 1: display near misses right like, it's not just a clear miss,
Speaker 1: though that can be shown too, but you're so close
Speaker 1: it almost lined up, and if it had lined up,
Speaker 1: you would have gotten a big payout. That creates this
Speaker 1: feeling that you almost succeeded and that you just need
Speaker 1: to stick with it a little bit longer. And then
Speaker 1: you're going to be rolling in the dough. It's all
Speaker 1: in an effort to encourage more gambling. Despite the token
Speaker 1: warnings and some casinos about the dangers of gambling addiction,
Speaker 1: loot boxes arguably do something very similar. They tempt players
Speaker 1: with the prospect of awarding rare in game items, whether
Speaker 1: those items are purely cosmetic or maybe they have some
Speaker 1: in game effect, and that has gotten companies into trouble.
Speaker 1: Various lawsuits around the world have been built around an
Speaker 1: argument that loot boxes are, at their heart, a kind
Speaker 1: of gambling. However, one thing that has remained a sticking
Speaker 1: point is that, unlike gambling, the stuff that comes out
Speaker 1: of loot boxes typically cannot be converted back into real
Speaker 1: world dollars, so that has defeated the gambling argument in
Speaker 1: a lot of court cases. That's an important distinction, right.
Speaker 1: If you go to play a poker game, for example,
Speaker 1: you may first have to convert your money into chips,
Speaker 1: and then you play your game. Let's say you're up,
Speaker 1: you're down, whatever it is. At the end of your
Speaker 1: time playing, you take whatever chips you have and you
Speaker 1: convert them back into money. But with loot boxes, you
Speaker 1: don't get to do that, you convert your money into
Speaker 1: loot boxes, or you convert your money into some in
Speaker 1: game currency that you then spend on loot boxes. Then
Speaker 1: you open the loot boxes and you end up with
Speaker 1: whatever the rewards are, but you can't change those back
Speaker 1: into real world dollars, at least not for most games. Now.
Speaker 1: I say most games because there have been lots of
Speaker 1: games that have allowed players to trade items in game
Speaker 1: between one another, where you can give it as a
Speaker 1: gift or you can trade for something else. And in
Speaker 1: those types of games, time and again we've seen markets
Speaker 1: spring up, player run markets in which players are offering
Speaker 1: to give away items in return for real money. But
Speaker 1: in those cases, you could argue this is really just
Speaker 1: more of a black market situation. The game itself is
Speaker 1: not responsible for creating those markets. It's arguably just inspiring
Speaker 1: it to happen. Many of the loop box court cases
Speaker 1: essentially have boiled down to saying that loop boxes are
Speaker 1: not technically gambling. But there's plenty of work published out
Speaker 1: there that points out how video games are relying on
Speaker 1: the same incentives as you would encounter in games of chance.
Speaker 1: I already mentioned the near miss thing with slot machines. Well,
Speaker 1: slot machines also will give much smaller payouts, sometimes small
Speaker 1: enough where it's not even covering however much money you've
Speaker 1: been spending as you're playing, and that this also helps
Speaker 1: encourage people play longer and to lose more money. Well,
Speaker 1: video games can also give out smaller payouts to convince
Speaker 1: you that, oh, you almost got the thing you wanted.
Speaker 1: You did get something. It's much lower in your esteem
Speaker 1: than whatever it is you're after, but at least it's something.
Speaker 1: And there are all these little feedback methods that games
Speaker 1: rely on in order to keep their players active in
Speaker 1: the game and hopefully spending more money to achieve some
Speaker 1: specific task. So I think it's legit to argue that
Speaker 1: the games are using somewhat predatory strategies in order to
Speaker 1: maximize revenue, even if the end result isn't gambling from
Speaker 1: a legal sense. It's just, you know, it's not against
Speaker 1: the law to get people hooked on playing a game
Speaker 1: that's not illegal. So that's the big loophole there. Now,
Speaker 1: there is one massive drawback to all the online stuff
Speaker 1: that we do need to talk about, But before we
Speaker 1: get to that, we're going to take another quick break
Speaker 1: to thank our sponsors. Will be right back all right.
Speaker 1: Before that break, I alluded to the fact that there
Speaker 1: is a huge disadvantage to these online components, and that
Speaker 1: is that there can come a time when a game company,
Speaker 1: for whatever reason, withdraws support for the game and operating
Speaker 1: game service. You know, like I said, it requires ongoing investment.
Speaker 1: You have to do maintenance and repair, You have to
Speaker 1: pay electrical bills if nothing else. So even just keeping
Speaker 1: an online game going requires a company to pour money
Speaker 1: into it. So it should come as no surprise that
Speaker 1: sometimes companies will shut stuff down if the money coming
Speaker 1: in is less than the money going out. That's what
Speaker 1: you got to do in order to keep your business
Speaker 1: afloat right. And also there are times where companies just
Speaker 1: go out of business. You know, maybe they went bankrupt,
Speaker 1: maybe they got a quiet. All of these things can
Speaker 1: affect whether or not a game will continue to get
Speaker 1: ongoing support. The list of abandoned games online games is
Speaker 1: pretty long, and of course it will just get longer.
Speaker 1: They include a lot of MMORPGs, you know, games like
Speaker 1: City of Heroes or Asheron's Call or Jade Dynasty, among
Speaker 1: with like dozens of others have had their day in
Speaker 1: the proverbial sun, only to subsequently fade from view now.
Speaker 1: Sometimes the communities for these games will keep things running
Speaker 1: with fan run servers. I mean City of Heroes has
Speaker 1: some of those where there's community servers out there that
Speaker 1: you can still play on. But other times the game
Speaker 1: just goes away and it means that you've got a
Speaker 1: game in your collection that you paid money for that
Speaker 1: you could no longer play because there's no longer a
Speaker 1: server supporting it. Sometimes the problem actually has to do
Speaker 1: with things like licensing fees. Right Like, if a game
Speaker 1: has been made that draws upon an establish IP, typically
Speaker 1: that sort of thing is done for a set amount
Speaker 1: of time and that is determined by a licensing agreement.
Speaker 1: Like a company might secure a license for a popular
Speaker 1: IP I'm just gonna name a random one. Let's say
Speaker 1: it's Batman, and the agreement allows the company to run
Speaker 1: this game for five years before the licensing agreement expires. Well,
Speaker 1: when that agreement does reach the end of its life cycle,
Speaker 1: that means that the game company either needs to pay
Speaker 1: to renew that license or it will have to end
Speaker 1: support for the game. And if a game again is
Speaker 1: not driving enough revenue, you can bet the company would
Speaker 1: go with option number two for games that require an
Speaker 1: always on DRM connection. That is another huge hassle, right
Speaker 1: because if someone buys a copy of the game, they
Speaker 1: typically expect to be able to play that anytime they
Speaker 1: want from that point forward. They bought it, so they
Speaker 1: should be able to play it. However, if the game
Speaker 1: they bought requires a connection to a DRM server and
Speaker 1: the game company goes away or those servers are shut
Speaker 1: down and they don't send out some sort of update
Speaker 1: that removes that DRM, that means the gamer is pretty
Speaker 1: much faced with two options. I either find a cracked
Speaker 1: copy of the game that has had the DRM stripped
Speaker 1: out of it so they can just keep playing, or
Speaker 1: they never play the game again because there are no
Speaker 1: verification servers out there and so the game won't launch.
Speaker 1: A couple of games have really frustrated players with DRM
Speaker 1: server shutdowns, such as Three Switched and dark Spot. Both
Speaker 1: of those games had always on DRM, and both of
Speaker 1: those games had those servers shut down, which made the
Speaker 1: games inert and it meant the only way you could
Speaker 1: play them was to get cracked versions of those games.
Speaker 1: So again, this DRM really is inspiring piracy more than
Speaker 1: dissuading pirates. But obviously the games that exist solely as
Speaker 1: online experiences are affected by server shutdowns, and that's It's
Speaker 1: like the same thing as saying you have one copy
Speaker 1: of the game, it's stored on your computer's hard drive,
Speaker 1: and your hard drive dies, well, like imagine that, but
Speaker 1: it's for an online server and the entire instance is dead.
Speaker 1: Sometimes again, communities will keep things going all in an
Speaker 1: effort to keep a game alive past it shutdown date.
Speaker 1: Other times you will hear about players who will gather
Speaker 1: online when a game is coming to an end, kind
Speaker 1: of like they're there to observe the end of the world,
Speaker 1: like it's an apocalyptic film or something. There are videos
Speaker 1: online of players congregating on various online worlds just as
Speaker 1: those online worlds were getting switched off for the last time.
Speaker 1: There are other really big issues in the video game
Speaker 1: industry these days, apart from the ones I'm talking about,
Speaker 1: Like one big one is the push to get games
Speaker 1: released as quickly as they can be. Gamers are notoriously
Speaker 1: bad at dealing with delayed gratification. That's part of why
Speaker 1: there's this rush among some gamers to jump into earth.
Speaker 1: The access for games or for beta testing, and so
Speaker 1: video game companies are often under a ton of pressure
Speaker 1: to get games out the door, even if those games
Speaker 1: are not fully baked yet, and a lot of that
Speaker 1: pressure doesn't necessarily just come from gamers, but from higher
Speaker 1: up on the food chain in the games industry, like
Speaker 1: there might be parent companies that want numbers on spreadsheets
Speaker 1: to look real good in time for an earnings call,
Speaker 1: and they might put the pressure to get a game
Speaker 1: out the door even if it's not fully ready yet.
Speaker 1: So lots of times games go live while they still
Speaker 1: need a lot of TLC. And it's become pretty common
Speaker 1: in the video game world to release a title and
Speaker 1: then require players to also download a massive patch early
Speaker 1: on to fix issues with the game, and a lot
Speaker 1: of games will release patches in the months that follow
Speaker 1: the released in order to address various bugs. Now, to
Speaker 1: be fair, we were talking earlier about the size and
Speaker 1: scope of massive like Triple A games. These days, when
Speaker 1: you get to that size, there's just no way for
Speaker 1: you to test everything thoroughly with all all the different
Speaker 1: possible variations that will happen once a game goes gold,
Speaker 1: assuming that game is popular, right, you can only test
Speaker 1: so many things. But in the real world people will
Speaker 1: try all sorts of stuff that you never even thought of,
Speaker 1: and some of that's going to break the game. So
Speaker 1: it's really only when the game is out in the
Speaker 1: real world and players are putting it through its paces
Speaker 1: that you find where the pain points are. And you
Speaker 1: should expect patches to follow the release of larger games,
Speaker 1: but yet it's still something of a joke in the
Speaker 1: game's world that anytime a game comes out these days,
Speaker 1: it does so with an enormous patch required on day one.
Speaker 1: But this is the world of big games. That's how
Speaker 1: things are now. And of course there are still smaller
Speaker 1: games out there, you know, games that don't necessarily require
Speaker 1: persistent online connections or have micro transactions or seasons of
Speaker 1: content or any of that stuff. But the studios that
Speaker 1: make these games are often these smaller, independent studios that
Speaker 1: are in the sights of the bigger players in the space.
Speaker 1: As those bigger companies gobble up the studios left and right,
Speaker 1: so your Microsoft's send your ten cents and your Embracer groups.
Speaker 1: They go out there and they acquire these smaller companies,
Speaker 1: and sometimes these are the same companies that get shut
Speaker 1: down later on by these bigger fish like you know,
Speaker 1: Arcane Austin and Tango Game Works and those sorts of studios.
Speaker 1: There are ways to do live service games correctly. There
Speaker 1: are ways that you can do it where it doesn't
Speaker 1: seem to withhold the best content in return for you know,
Speaker 1: someone paying a ransom to the developer to get access
Speaker 1: to it. There are ways that encourage players to enjoy
Speaker 1: a game on their own terms, which can include spending
Speaker 1: a bit more after initial purchase if the players want to.
Speaker 1: I've played a few games myself where I've chosen to
Speaker 1: purchase stuff in game because the title I was playing
Speaker 1: was free to play, or or I had been playing
Speaker 1: it for years and I was really enjoying it, and
Speaker 1: I wanted to continue to support something that I really
Speaker 1: liked because that's the way I get more stuff that
Speaker 1: I like. Plus, I mean, some of those exclusive outfits
Speaker 1: get real snazzy. But obviously there are lots of ways
Speaker 1: to do it poorly. And I think that's the big
Speaker 1: issue we're seeing right now in the video games industry
Speaker 1: is that there are a lot of companies that seem
Speaker 1: to be pretty eager to throw in as many of
Speaker 1: these abilities to generate revenue down the line of a
Speaker 1: games lifespan as is possible without regard to how that
Speaker 1: actually impacts the playing experience or gamers' perceptions of the game.
Speaker 1: There have been a lot of games that have come
Speaker 1: out recently that have had some hefty criticism thrown their way.
Speaker 1: For this, one that just recently springs to mind is
Speaker 1: the Suicide Squad Kills the Justice League game. That one
Speaker 1: has received a lot of criticism recently for many reasons,
Speaker 1: not just the live service aspects of the game, but
Speaker 1: that has been part of that conversation. So yeah, I
Speaker 1: don't think live service is going away. I don't think
Speaker 1: games as a service is really going away. I think
Speaker 1: you will still find independent game developers who create really
Speaker 1: interesting and fun and entertaining games out there that lack
Speaker 1: a lot of the stuff because they're not working at
Speaker 1: that same scale. But I think just the nature of
Speaker 1: the truly enormous games, the really deep, huge games of scope,
Speaker 1: that kind of necessitates this long tail revenue approach. Otherwise
Speaker 1: there's no reason to do it because you'll never make
Speaker 1: your money back. You'll spend way more developing than you'll
Speaker 1: get from sales. So again I think It's understandable, but
Speaker 1: there is, in my opinion, a right way and a
Speaker 1: wrong way to go about doing it. I hope you
Speaker 1: enjoyed this pair of episodes. I hope you are all well,
Speaker 1: and I'll talk to you again really soon. Tech Stuff
Speaker 1: is an iHeartRadio production. For more podcasts from iHeartRadio, visit
Speaker 1: the iHeartRadio app, Apple Podcasts, or wherever you listen to
Speaker 1: your favorite shows.