Unlocking free-to-play blockchain games: 4 barriers developers must overcome
FlowPlay’s Derrick Morton unpicks the new opportunity
This is guest column from Derrick Morton, co-founder and CEO of Seattle-based FlowPlay, who has been an entrepreneur, leader and innovator in the digital entertainment industry for more than 20 years.
Game developers are notorious for jumping on the latest trend and emerging technology. In a mad dash to reimagine business models and player experiences, game companies are aggressive about taking the lead on competition.
Blockchain, already disrupting dozens of industries, is one of the latest innovations to capture the attention and generate excitement in the games industry.
blockchain technology is primed to innovate game mechanics such as currency models, item ownership and player-to-player trading.
Particularly in the free-to-play games space, blockchain technology is primed to innovate game mechanics such as currency models, item ownership and player-to-player trading, transforming game experiences offered by indies and major publishers alike.
When blockchain was introduced to the gaming industry in late 2017, developers leapt at the chance to use the flashy new tech and build new experiences with it. But those that acted too quickly soon realized there was a steep learning (and adoption) curve to overcome before the tech’s full potential could be unlocked.
The industry’s “first to release” mentality has caused many developers to skip over the groundwork necessary to optimize and integrate blockchain in a meaningful way, ultimately hindering them from tapping a booming new category of games.
In the aftermath of early failures, developers and studios have since allowed the hype to settle and are going back to the drawing board. In order to leverage blockchain in a way that meets players needs and ensures a positive, lasting impact, developers have a few key barriers to overcome. By addressing the issues outlined below, developers will strengthen their ability to create a new generation of free-to-play blockchain games and usher the new age of blockchain into the games industry.
1. Indie opportunity
The games market is saturated, and largely dominated by a select few major publishers, making it nearly impossible for indie developers to break through in a meaningful way. With industry behemoths keeping tight control over the market, often at the expense of smaller studios, indie developers are desperate for ways to reduce user acquisition and production costs for their free-to-play titles.
Today’s go-to app stores have created an ecosystem that caters to large developers, eats up profits and leaves smaller developers little control over game earnings and distribution. A blockchain-based market – where every developer has a stake in the ground – has the potential to remedy these flaws and overhaul app marketplaces.
Blockchain introduces a new standard for free-to-play games and a way for indies to democratize game development, which will ultimately give every developer a voice in the market. Achieving this will be complicated, and is likely still a long way off, but indie developers should actively explore how blockchain and partnership with other indie developers may work into their business models.
One startup looking to change today’s status quo is RAWG, a personalized video game discovery platform that gives developers and players the power instead of the app stores.
With the already high barrier of entry continuing to rise each year, the company believes its platform will provide an IMDB-style database that solves the discoverability issue through the use of blockchain. This means indie developers will be given as much visibility as AAA developers, removing the major disconnect created by today’s gaming ecosystem providing a universal benefit to developers and players.
Today’s free-to-play landscape limits players to buying and trading virtual items within a single experience and environment. To offer players more flexibility, the industry needs a sustainable model that is equally beneficial for game developers, players and content creators. To even the playing field for all game developers on the blockchain, developers must enable interoperability between games.
From a technology perspective, this will require a tremendous amount of innovation. It will demand buy-in and participation from numerous developers willing to create an integrated multi-game network that utilizes the same in-game currencies and trading marketplace.
Not only will this give in-game items more value and meaning for players but ensures sustainable revenue from the exchange of goods and provides free customer acquisition for developers that are a part of the ecosystem. Once this happens, it will create a fairer business model with endless possibilities to unlock new features and experiences for consumers.
To even the playing field for all game developers on the blockchain, developers must enable interoperability between games.
There are a few startups tackling this issue head on – one of which is Alto.io. By providing a decentralized platform that empowers the entire games ecosystem to mint, use and sell crypto items, Alto.io is one of the first to try and overhaul the challenge of connecting games to the blockchain by introducing an item-first ecosystem built around the ERC721 non-fungible token (NFT) standard.
Since all ERC721 tokens are non-fungible or simply put – unique – Alto.io Chairman Gabby Dizon states the company can “use other studio’s game assets in a permission-free manner and vice versa,” providing a seamless player experience between games in the ecosystem.
Looking forward, Dizon is excited about the introduction of interoperability, “because we can have quests that hop across different game worlds, have persistent characters that can move across different games, and have a permanent recorded history of actions of a character that is recorded on the blockchain.”
Another company looking to facilitate the true ownership of game assets on the blockchain is Hoard Exchange. With digital assets accounting for 78 percent of revenue generated by the entire industry, the startup provides a platform that bypasses traditional funding models, allowing developers to raise funds through individuals offering players real value in return which gives players true ownership.
3. Shared community
Most game communities are controlled by the developer, meaning the developer has all the decision-making power when it comes to gameplay, social capabilities and the game’s narrative. This can leave players frustrated over the lack of control they have over their own experience, which will eventually cause them to move on to a new game.
The integration of blockchain offers a way to change this status quo, by opening the door for players to take part in content creation and rule enforcement. In the simplest of ways, blockchain can be used to create new game items such as breeding new cats in CryptoKitties.
However, there will also be more sophisticated applications like building new maps in a virtual world or creating an in-game investment mechanism that unlocks exclusive levels. Think of the potential for how this type of collaboration could strengthen the link between developers and their fans, and stimulate creativity.
Like interoperability, creating such a shared community will require a notable cultural shift in the way games are imagined, played and evolved. There will be some resistance, but once a few developers take lead, it will start to become the standard.
An example of a company taking the lead on this issue is Decentraland, a decentralized virtual world where users can create, experience and monetize their content and applications. The startup is founded on the idea that a public virtual world should be ruled by open standards, shielded from the agenda of any central organization.
Other companies will follow suit in order to provide a platform that brings players and developers together to make better games. Players would be paid for their efforts in the company’s token which they can use to buy more games, in-game content, or gaming hardware, using blockchain technology to register and catalog gamers’ contributions and payments.
Blockchain has received its fair share of attention, but it remains a complex topic largely misunderstood by even the most tech-savvy consumer.
Developers have the opportunity (and burden) to make it more accessible to consumers and ensure it adds value to the player’s game experience. By starting to utilize blockchain technologies now, developers can chip away at consumer misconceptions and build a foundation for future games.
creating such a shared community will require a notable cultural shift in the way games are imagined, played and evolved.
Another attractive option is for developers to make blockchain “invisible” to players, which sidesteps the issue of consumer misconception. Players will see their favorite game per usual, while the backend infrastructure includes new blockchain mechanics – such as a distributed ledger to improve overall in-game transaction security and functionality.
A careful backend deployment allows developers to further blockchain-based gaming while continuing to provide a seamless experience for its community. Games like EOSBet Dice are early examples of addressing accessibility challenges and leveraging blockchain mechanics behind the scenes.
The global gaming industry will continue to grow, with over two billion gamers spending nearly $138 billion in 2018 alone. If developers execute well, blockchain will disrupt our industry as it has others, and help indie developers change today’s flawed models and better compete with the top publishers.
Derrick Morton, co-founder and CEO of Seattle-based FlowPlay, has been an entrepreneur, leader and innovator in the digital entertainment industry for more than 20 years.
At the helm of FlowPlay for the last decade, he has established the company as the creator of the industry’s most powerful immersive gaming platform, and driven product innovation to build an engaging multiplayer social casino that captures the attention of 75 million users worldwide. He has identified new opportunities and untapped markets including free-to-play sports betting and fantasy sports gaming, and spearheaded the development of more than 200 digital entertainment projects.
Join us at Blockchain Games Connects Hong Kong – 17-18 July 2019.