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Crowd Power: The Future of Video Games

Red Thomas Posted:
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Five years ago in the summer of 2009 a single independent developer released a small alpha build for a game that he was working on in his spare time.  Two years later, the full release version of Minecraft rolled out amid a tidal wave of excited gamers.  It could be said that Markus Persson single-handedly pulled indie video game development into the lime light.

Since Minecraft stormed into popular culture, Valve introduced their Greenlight service and began promoting indie games and a number of development tools for creating them, Kickstarter and other crowdfunding websites saw a wild surge in popularity, and other dramatic other shifts in the economics of the video gaming industry have  taken place.  As tools were developed to place more power in the hands of the crowd and as game developers learned to harness the creativity among their fans, we’ve seen the first real shift in the way the video game industry conducts business since the initial surge of online gaming in the late 1990’s.

What started with a serious growl from Minecraft has turned into a full-throated roar with Star Citizen, the new massively multiplayer online (MMO) space-simulator and brainchild of game-pioneer, Chris Roberts.  Star Citizen was initially crowdfunded in the fall of 2012, with the team asking a modest $2 million initial funding for the project and offering stretch goals through $4 million.  They ended up clearing over $6 million by the end of their campaign, which was well beyond any of their initial goals.  All that is just a drop in the bucket next to the $55 million dollar mark they currently sit at.  That’s more than twice what Chris Roberts had initially projected as the total cost of development.

Chris Roberts and team captured the power of the crowd to not only fund a game, but promote it.

Other games like Richard Garriott’s Shroud of the Avatar and Jon Mavor’s Planetary Annihilation have successfully reached out to fans for initial funding, a very suggestive sign that the current trend has likely passed beyond mere fad and into the realm of established economic models and business strategies.  A large part of the draw for backers?  The opportunity to help contribute to the game they helped to fund via something called “crowdsourced development.”

Crowdsourcing and crowdfunding are two sides of the same coin.  Where crowdfunding is community-driven funding of a project, crowdsourcing takes advantage of the group’s diverse talents and large labor pool to actually do the work of building the game.  It’s not just a model for indie developers and niche games, though.  Some of the largest developers and publishers are rapidly switching gears to take advantage of the new trend.  

Sony Online Entertainment (SOE), which originally came to fame in the online gaming market through their EverQuest and PlanetSide games, has adapted to the new norm with all alacrity.  As President of SOE, John Smedley is a guy who follows trends in the video game industry closely, and SOE’s success can be directly attributed to his ability to perceive the flows of that market.  SOE has made a major push to crowdsource items in all their games over the last couple years, and I had the chance to ask him about his thoughts on the subject recently at SOE Live in Las Vegas.

“The strategy where we were making everything was just untenable.” – John Smedley

Mr. Smedley specifically pointed out how different SOE’s operating strategy was today compared to how it was even five years ago due to the rise in crowdfunding and crowdsourcing.  “It’s a complete and total make-over of SOE,” he remarked.  “We’re building the foundation of our company on croudsourcing.   Though, community-building would be a better way to put it, because our goal is to build a core-community that is dedicated to building cool stuff and getting paid for it.  We built a set of tools that we think are fantastic, and so now we’re giving them to the players hoping that they’ll build some cool stuff.”  There’s no doubt the move has been a successful idea as some participants in SOE’s Player Studio are already earning enough to live on by selling their products to fellow players.  “We’ve just been blown away,” Smedley said as he described some of the amazing things to come out of their new community of builders.

Though it grew to popularity in the video game industry as a method of encouraging backers to contribute, crowdsourcing has actually been around a long time.  Our Android phones are actually the offshoot of several open source projects.  Even in games, whole communities have grown up around creating modifications and hacks for released games, some of them even becoming more popular than the original game.  DayZ, a zombie-survival mod for a game called Arma II ended up being far more popular than the original game, and even helped spur the current growth in the survival horror genre, including SOE’s game H1Z1.

John Smedley is very frank about how good crowdsourcing is for larger companies, as well.  One of the largest complaints about MMO games has always been that there was a limited amount of content, and that new content development was too slow.  “The strategy where we were making everything was just untenable.  There’s just too many examples of players blitzing through content way faster than we could possibly make it.  This is the only logical outcome of that,” Smedley explains.

Richard Garriott, another big name in the video game industry, has teamed up with Executive Producer Starr Long to produce the spiritual successor of their genre-defining game, Ultima Online.  Their new game, Shroud of the Avatar, started as a crowdfunding campaign and moved right into a very crowdsourced development.  Fans have contributed everything from music and art for the game, to major assets like terrain and buildings.

Crowdsourcing is a major component of Shroud’s development.  Where SOE has created a lot of success in their game PlanetSide 2 post-release by giving players to chance to build their own cosmetic assets, Shroud of the Avatar is giving fans the opportunity to build the actual game.  In both cases players get some compensation.  Players sell cosmetic items in PlanetSide 2 to other players and make real money from it.  Richard and Starr are also paying cash to fans for contributions to their game, or offering them twice as much if they take their payment in the form of in-game items from the cash shop.

Richard Garriott and team has sourced a lot of their game’s content from the crowd.

Both systems have proven to be very successful for both players and developers.  Eric Peterson, former Producer for Star Citizen, once pointed out that it’s in large part due to several years of gamers slowly having become accustomed to paying for access to earlier and rougher versions of games.  The definition of beta access has changed over the last decade from being a test, to being free publicity, to the point where it’s now actually part of the economic model of most MMOs.

The changing landscape has impacted more than just video games, as New York Times best-selling author Tracy Hickman has demonstrated recently in a crowdfunding project of his own.  While most know him from his famed Dragonlance series of novels, Mr. Hickman now has his hand in a newly crowdfunded table-top game called Sojourner’s Tales.

While Tracy Hickman comes off as a humble and unassuming gentleman, don’t allow his congeniality fool you.  He just happens to have some amazingly intelligent insight on the growth of crowdfunding and what it may mean for the future of the industry.  He notes that, “crowdfunding has revolutionized the approach to games...  Many established game designers who have gone through traditional channels in the past, at least from my perspective, have almost universally moved to crowdfunding in terms of getting their projects done.”

He goes on to say that the advantages of crowdfunding are that you’re no longer restricted by the game companies and their concepts of what fit within their bottom line or market niche.  That means that with crowdfunding, you’re not beholden to anyone other than your fans.  You’re also not trying to fit the company’s mold, “as much as you’re trying to find an audience and address their needs directly.”

Hickman also notes that the internet and popularity of social media has “opened up so many avenues for [game developers] to address the audience directly and interact with the audience.  The more traditional ways to distribute a product are rapidly being challenged and made obsolete.”  More importantly, Hickman indicates that his job is increasingly less about pleasing publishers and agents, than it is about pleasing his audience.  That’s a really awesome thing, and Tracy Hickman is even starting up a series of classes to help authors learn to be more in touch with their audiences and responsive to them.

What was particularly insightful in my conversation with Tracy Hickman, was his remark about the similarities in what we’re seeing with video games today to the latter days of Big Hollywood and rise in indie films in the 1950s.  In many ways, indie films helped saved cinema in a time where television was making that form of entertainment too accessible.  A situation not too dissimilar from today’s surge in easily accessible games for the mobile platform.  Hickman says, “we’re moving through the same lessons [with games and books], as we learned in the ‘50s about the film industry in terms of publishing.”

Tracy Hickman is looking to create classes on understanding crowdfunding and how to interact with fans through it.

At the end of the ‘50s and moving into the ‘60s, the film industry was on the verge of collapse because it was a vertical monopoly.  Film companies controlled everything from having the actors, the writers, and the directors under contract, to even owning the point of distribution in the form of the theaters.  “Publishing for books and games is the same way,” says Hickman, who then astutely points out, “what happened was that independent producers came in and major film studios figured out that they weren’t in the business of making movies.  They were in the business of financing movies.  Once they figured that out, you had these independent directors coming in and making movies like Easy Rider and counter-culture films that big studios would have never done before.”

If Tracy Hickman’s suggested analog holds as true for game industry as it did for the film industry, we could really be looking at a fantastic next decade in video games.  Though, perhaps we’ll see fewer of the vast and sweeping epics in years to come as we have over the past decade.  It’s hard to do Gone with the Wind or Ben-Hur on an indie budget, but the air of experimentation in films over the last several decades has matured to the point where some are back to trying. Thanks to crowdfunding, what’s happening to video games may be even better in many ways.  For the most part, film makers still have to pitch ideas to big studios.  Game makers can pitch their idea directly to us, and then we’ll even help them make it.  There’s some danger in that though, because not all of them are going to make the finish line.

Some projects may fail due to poor planning or inexperience.  Great ideas still need to be balanced of the framework of feasibility, and without experienced hands there to guide money away from bad projects, we’ll likely see some major busts before long.  Then, there’s the lack of any legal recourse in current crowdfunding options.  That makes the perfect breeding ground for scams.

A major concern is that the first time a scam hits a crowdfunding campaign and impacts a larger group of people, the immediate reaction will be a call for legal reform.  The problem is that knee-jerk legislative remedies are never a good thing.  To prevent it from happening, we need to look at the situation now and apply prudent measures before the process gets damaged via excess drama.

Raising money to kick off new projects is not a new concept, though.  That means there are already laws in most countries for how to control it, and how to protect contributors from scams.  Legislators need to be encouraged now to compare existing laws and regulations to the new process and adapt as necessary.  The most important thing is to do everything possible not to stifle the opportunity for new entrepreneurs and artists that this new medium creates.

If we can work through the problems inherent in any new system while protecting the possibilities offered by it, and the big game developers can be as successful at adapting to the new environment as companies such as Cloud Imperium Games, Portalarium, and Sony Online Entertainment have been, then it’s easy to see a bright future ahead for the video game industry.  It may be a future full of great new titles that are targeted at specific audiences, rather than being merely acceptable to most of them.  The best of all will be that these games will come from new talent, rather than established industry professionals.  That means we can expect a creativity in the field that we probably haven’t seen since the ‘90s, if even then.  Today is a great day to game, and tomorrow may be even better.  


Red Thomas

A veteran of the US Army, raging geek, and avid gamer, Red Thomas is that cool uncle all the kids in the family like to spend their summers with. Red lives in San Antonio with his wife where he runs his company and works with the city government to promote geek culture.