Video Games, not just for Kids

So, today was one of those days where I had a few different topics that I wanted to write about. I had a request to write about video games. I’ve written one or two blogs about video games in the past. However, I think that there’s always more to be said about them.

I think it’s fair to say that video games are a bit of the red headed step child in the entertainment industry. They aren’t taken as seriously as movies and it’s not as culturally acceptable to geek out over video games as it is to geek out over movies (some movies) or television shows. However, I think that this is going to change and it’s not because of the video game designers and publishers.

I think that Twitch is going to drive to make video games more acceptable and shift video games location in culture. Through events like Intel’s championship series or DreamHack which is a collection of tournaments for games like DOTA 2, League of Legends, Star Craft, and many more, I believe that there is an opportunity for video games to reach an acceptance level akin to golf. For the most part these games are multiplayer and very team based. There are leagues, trading of players and everything else you would expect in a major league “sport.”

It’s not just these events, it’s the personalities that drive watching live streaming. As I’ve mentioned in the past I have a few friends that stream and there is a community that has sprung up around watching these guys play. It’s pretty awesome.

Through these streamers, I’ve been able to experience many more interesting games than I can actually play or even afford to play. This allows me to keep abreast of the video game landscape without having to really play (I play Civ V, Binding of Isaac, Super Meat Boy mostly). In the case where the streamers are playing single player games it’s similar to watching a movie with someone guiding the movie. It’s a lot of fun, especially since you’re able to have a conversation with the star and his fans all at the same time.

Furthermore, I think that video games have not been given enough credit for pushing the boundaries of technology. Game designers and players for PC together drive companies like Intel, AMD, and Nvidia to keep designing newer and more powerful products. Intel is able to make a massive profit on their platforms designed for gaming – they know it, they’ve changed their strategy a few times in regard to selling stand alone chips because of gamer’s demands. We should be praising the hardcore gamer because they are helping us continue to advance in one of the few bright spots in our economy.

Each video game community has it’s own quirks and idiosyncrasies, which can be seen in how new games are developed as well as in business practices for the developer. For example, Valve has several economists studying the naturally occurring economy around trading in games like TF2, I believe that through controlled economic settings like TF2 where there is no central control (Blizzard I’m looking at you!) unique economic conditions can emerge that will shape how the designers develop future releases in the game. This has been clearly shown in how Valve continually releases new hats (yes, hats).

Compared to Eve (a massive multiplayer online role playing space video game) TF2’s economic system is rudementary. In Eve you can buy, build, trade and develop true economic systems. Furthermore, it’s possible to see the effect of war and diplomatic missteps on the economy. Recently nearly $200k worth of money was wiped out because someone missed a monthly payment. It’s possible to see how various factions have recovered after a serious economic, material, and military shock hit the entire game.

Games are vital to our culture. We’ve always had both physical (sports) and mental (chess) games. I believe that video games are simply a new extension to both of those. Many games require you to think quickly and have quick moving fingers (Star Craft) while others are almost as passive as watching TV. Understanding the value of video games and the culture about them is important to understand how our culture can grow and develop in new ways.

Musings from an annoying commute

On the Max ride home today, I heard to late 40-50ish guys having a chat about the down fall of the current generation of kids. I was trying to read my book, but the conversation ranged from the casually uninformed, family first thoughts, to the down right ignorant. According to these gentlemen our society is in the shitter because of the decline of the nuclear family, kids think video games are real, and therefore the kids in Columbine thought that they could take 8 bullets and come back to life. I had to restrain myself from commenting on this bucket of ignorance.

First of all, the nuclear family is essentially a myth. we’ve had modified family structures for as long as there have been families. A ton of people I know have had parents that have divorced, one spouse cheating on the other, or some sort of death in the family. Almost all of these people have turned out reasonably well. Everyone has their problems, but I don’t think that it’s solely due to family structure problems. If anything, the family structure problems that these guys are talking about are related to problems more closely associated with inequality and the fact that these families have someone in prison, work 2 or 3 jobs to support their family. These folks have to work so much because they can’t afford rent and our economy is structured around the car, which most of these people are being priced out of.

Second of all, violence and confusion over video games and reality don’t really exist. According to a recent study, if people are aggressive during or after a game it’s NOT because of the violence or lack thereof, but because of a lack of skill or fairness in the game. Apparently, people are more aggressive if Tetris is more difficult than if it’s easier. I think that Candy Crush Saga is a perfect example of this. The most difficult levels are frustrating because it has nothing to do with your skill, solely if you get the right combination of candies to effect a board clearing combination. Even if you do everything perfectly, you can still lose – which keeps pulling you back in. Dark Souls is another case in point. The game is so frustratingly difficult that many people rage quit, but they keep coming back because of the sense of accomplishment upon completing these difficult monsters/bosses. Essentially, the reward of accomplishment and skill accrual is worth the frustration.

Finally, because of this clear separation between reality and game the boys in Columbine didn’t think they could take a ton of bullets. This is obvious due to the fact that they committed suicide with one bullet. The problem with those boys is the fact that we don’t really speak to each other well about our problems. Marilyn Manson had the best response to that back shortly after the horrific events happened.

The conversation between these two men really just struck me as two guys looking for someone to listen to them and parrot it back. Honestly thought, it really just reminded me of two stoners talking about things.

If I made video games, this is how I’d deal with Piracy

Piracy is something of a real issue. It can impact the livelihoods of artists as well as the big companies. However, the methods that companies go to when fighting piracy are extreme and infuriate end users. The people that listen to music or play games for the love of music or video games.

My friends over at KMBOD have written in the past about how horrible some of the Digital Rights Management (DRM) systems are on video games. These systems require continual verification that the game has actually been purchased. In some cases it makes the game unplayable or extremely difficult to play. In some cases the user must be online the entire time regardless of the type of game the user is playing. It makes sense for the game to be online if you’re playing multiplayer games, but if you’re playing a single version of the game why would you need to be online? Why should the game suddenly crash if you get disconnected from the internet? These types of things anger the gaming community and drive them away from specific titles and potentially entire publishing companies. Some publishing companies are Electronic Arts and Valve.

I don’t think that DRM is the right system to use. For one it’s easy to get around if you really want to and many players kind of look at DRM as a challenge something they should get around and publish online as a community service. It’s not just video games that do this, but also DVDs, Blu Ray and CD’s. In fact in the US it’s illegal under the DMCA to circumvent DRM.

So what would I do instead? Since there are a fair number of pretty easy distribution channels for video games now. There’s Steam, EA’s origin and a few other ones that I’m not really aware of. There’s also buying it from Amazon, Best Buy, Game Stop and a bunch of other stores. So access to the game is pretty easy. Price might be an issue, but for good games people are willing to pay a premium, just look at the sales of Skyrim and Modern Warfare 3. Huge blockbuster games. These changes are mostly for First Person Shooters, but similar type changes could apply for other types of video games, such as RPGs or strategy games.

Despite the ease of access people still pirate because they want to try before they drop $60 on a game. So what I’d do is make it as easy as possible to access both legally and illegally. I fully believe in the try before you buy model. However, for copies that weren’t installed from a CD or downloaded from an online distributor like Steam the game quality would be diminished. For instance many gamers complain about the number of frames per second for a game. Video is shot at 60 fps and the human eye can’t see much faster than that, but we can tell the difference if it’s much slower than that amount. In the illegal versions I would make the game run at 30 fps, but it would initially start at the 60 fps and over the course of a minute or two and have a little note flash that if you buy the game you can get the full 60 fps.

Another feature that gamers complain about is the perspective within the game (field of view FOV). They describe it as feeling like your playing with your head in the monitor. basically it’s restriction on peripheral vision. Again I would start the game out with full vision and then slowly move the POV into the “monitor” restricting the view and giving the paying customers an advantage over the pirate customers.

I would also make the user do less damage than their paying counter parts. This would reduce the number of kills and make the player less effective on the playing field and more likely to die and less likely to kill. Finally, the last thing I would do is to have a little pirate flag next to any player that didn’t legally purchase the game so all of the other players would know when some one hadn’t bought the game. In games where kill counts matter this could cause users to be banned from servers and reduce the ease access for playing.

None of these things would ruin the game to the point that some one wouldn’t want to play it. What it would do though is push people towards paying to be able to compete at the same level as everyone else.

Router = Computer

According to the online magazine Techeye.net an ADSL modem/router is considered by a German court. The dispute is over if a user is allowed to install software that changes the ADSL modem’s firewall settings. It was actually a battle between two companies, the company that makes the router and the company making software for the router. I think that this ruling has some extremely interesting implications.

First, by defining a router as a computer it opens the door for a HUGE number of devices to be defined as a computer. Most of us wouldn’t think of a router as a computer. It’s a switch, it has a very specific purpose of deciding which packet gets through to the network at a given time and to prevent congestion on the network. In this case, it has the additional function of pulling out the high speed data from the phone line as well. It does have a user interface, but it’s typically restricted to a web browser. This is hardly something the average user would consider a computer. Which tells me something about the judge in the case – he understands technology and computing. The US and rest of Europe could use more judges like this.

Second, since a broad range of devices are now considered devices, at least in Germany, it could force companies to open up their hardware to user software manipulation. I see a few areas where I think this will cause major companies problems.

The first would be video game consoles. If a router is considered a computer there is no way that a company could argue that a video game console is not a computer. Consider the following, you are able to install software video games onto the console, you actually interact with an operating system, you are able to browse the internet and of course play games on the console. These are all things you are able to do on your PC. There are more restrictions on the console than the PC of course. Now, let’s say a third party company wants to come along and create something that will allow you to increase the functionality of the software or the machine in someway. In Germany, the user should have the right to do that.

The second would be cell phones. It’s pretty obvious that cellphones are computers and this ruling would just cement that. I think this will cause more problems for iOS than for Android. For two reasons, first Android already allows third party app stores onto the devices which increases the control of the end user over the computer. Second, Apple controls what software can be allowed into the app store thus controlling what a user is able to install on their computer. The German ruling basically says that a company cannot stop a user from installing software onto their computer if they want to install it. Apple and the App store are directly controlling what a user can and cannot install onto their device. I would not be surprised if this type of control is challenged in the German courts.

One other implications could be that as you own the computer user may be able to stop companies from remotely installing software onto their computer they don’t want on there. For instance, in the US it’s not uncommon for Verizon Wireless to push software out to specific devices without notifying you. You are giving implicit consent by using their networks. However, if the same thing happened to my PC from Comcast there would be a law suit. Since phones are in a weird quasi state of rights in the US there isn’t the same sort of feelings. However, I believe as the gap between PC and phones close and the desire to control what goes on the phone and what doesn’t increases there will be lawsuits over installing and deleting software from your computer.

Disruptive technologies and long term impacts IV

In yesterdays post (click here for the first in my series) I discussed some of the long term implications mostly related to the software industry. However, these ideas relate to some of my previous blog posts about innovation in that post I talk about long waves and these paradigmatic type technologies. Where we need to be aware that these disruptive technologies can interact with society on a number of different levels. In the case of video game consoles, while a pretty big industry, it’s not a big chunk of our overall economic output. Even with in video games, you could argue that different types of coding methods have revolutionized how writing video games occur, so you can make these steps as small as possible, or as large as you can think of like the semiconductor based transistor. The transistor has lead to a huge shift in how our economy works.

The problem with new technologies is that we never know ahead of time what the impact of a disruptive technology will be. For instance, of the renewable energy sources we can’t tell which one will have the most long term impact. However, these are all disruptive technologies. If enough solar, wind, wave, and geothermal energy were produced we wouldn’t have a need for coal fired plants. This would create a massive shift in our economy. It would destroy a lot of mining companies, would shutter many power plants and put people out of jobs from the mining companies and the power plants. Of course changing from a poisonous energy source that we are rapidly depleting to a fully renewable resource is completely desirable. However, these disruptive technologies will have farther longer term impacts that we think of initially.

These new energy sources may eventually have lower energy costs than we currently experience under the coal/oil/gas regime. However, this extra money is typically spent on other goods. Which should be cheaper as energy costs are reduced. In many industries, the biggest expense is on energy. Reducing that will significantly shift the cost of these products. Unless, of course, the companies keep the higher prices to keep up profits. These lower costs should make it easier for new companies to enter with a lower price point which will keep innovation moving forward.

There difficulties with adopting new technologies. There are a lot of socio economic reasons to minimize the adoption of a disruptive technology. In my next blog I’ll discuss some different theories of how new technologies are adopted.

Disruptive technologies and long term impacts III

As I discussed yesterday, disruptive technology’s impact can be mitigated by extensive networks. So how do these networks form? Well, they can be formed by movement of employees, which can lead to an exchange of tacit knowledge as well as increasing the likelihood for a collaboration. For instance, my roommate’s employer has asked if his former professor would like to collaborate with them. This would lead to a direct knowledge flow from a large university in the US to a public-private research organization in the NL which would then diffuse to that organization’s partners. These networks can help reduce uncertainty through an ability to acquire additional skills sets which are not currently possessed within an organization.

The networks can be built through previous collaborations, suggests of a previous intermediary organization, such as a publisher in the video game sense. Or there could be other forms of collaboration such as licensing technologies like the Quake/Unreal engines in video games. This allows for a full knowledge transfer of technology from one organization to another through formal methods. However, the reason for adopting one technology over the other could come down to a single employee which used to use one or the other technology at a previous job.

Now, how do these impact long term innovations and economic growth? I haven’t talked about that at all. It’s not exactly straight forward. In some ways, as you can see from the network diagrams yesterday, these disruptive technologies have clearly lead to an explosion of growth within the video game industry. This is most likely why it’s over a multi-billion dollar a year industry. Extensive networking and collaboration at the beginning of a new generation of technology is good for the console maker and the consumer as it leads to a faster ramp of video games. See the graph below:

So, these networks help expand the options for consumers and lead to growth in the industry. Disruptive technologies are really good for the economy. Otherwise, we’d see a steady decline in prices and demand for products as people will already have them. In the example of video games, there are other drivers forcing the continued evolution of console technology, such as competition with the PC gaming platform, as well as continued expectations of better graphics and better game play. While there are a lot of people that scoff at the consoles, they do drive expectations for better graphics. People get tired of the same visual representation of their football teams. They want to see the graphics improve, the physics engines improve. Basically they need a continued improvement of technology to meet these expectations. These in turn help push the boundaries of PC games as well.

This is a fairly rosy picture of this march forward. There’s no concern for intellectual property, any licensing that is being done is obvious. I don’t expect this to continue. Which brings us back to the software patenting issue. We all know it’s a horrible thing.

References:
Vaan, Mathijs de, “Interfirm Networks and firm performance in the face of technological discontinuities” 2010 Druid conference

Disruptive technologies and long term impacts II

Yesterday I discussed how disruptive technologies can drive our economy through creating new opportunities. However, it can obviously have some very negative impacts at the firm level. Let’s look at consoles again. First, as most of us are aware, there are only three major console manufacturers in existence. There have been a pretty steady number of console makers since the 90’s however the players have changed. Sega and Nintendo were the biggest players when I was young, however this shifted to Sony and Nintendo in the mid 90’s with the N64 and Playstation. The console makers are only half of it though. Without publishers, like EA, game developers, like Bungee, the gaming industry would die.

The people impacted by the changing in consoles are not just the console makers themselves, but also the publishers and the developers. In fact, it could be argued that the different platforms (consoles and PC) make it as difficult or more difficult for the developers. Some games the console makers want specifically for their console only. This cuts into the potential profits of a game developer. Additionally, there are difficulties of learning how to program for the new systems. Not all game developer or publisher is going to get early access to the new console. This makes it very difficult for them to actually compete with other developers, which do.

In a pretty cool paper (Vaan, 2010) that looks into the survival rate of developers and publishers after a disruptive change, they investigate the role of a networks. Below is a time series of network changes. Which show that the closer you are to the center of the network increases survival rate.

Network of video game developers (Vaan, 2010)

These networks are important outside of the video game industry as well. In my next blog I’ll go into more details about the importance of networks in surviving new technologies.

References:
Vaan, Mathijs de, “Interfirm Networks and firm performance in the face of technological discontinuities” 2010 Druid conference