Worlds In Motion

Round-Up: Gamasutra Network Jobs, Week Of November 6

research@gdmag.com (Simon Carless) — Fri, 06 Nov 2009 18:48:13 -0500

In our latest employment-specific round-up, we highlight some of the notable jobs posted in big sister site Gamasutra's industry-leading game jobs section this week, including positions from 5th Cell, Insomniac and more.

Each position posted by employers will appear on the main Gamasutra job board, including positions from Sega of America, 2K Marin and more.

Each position posted by employers will appear on the main Gamasutra job board, and appear in the site's daily and weekly newsletters, reaching our readers directly.

It will also be cross-posted for free across its network of submarket sites, which includes content sites focused on online worlds, cellphone games, 'serious games', independent games and more.

Some of the notable jobs posted this week include:

Rainbow Studios: Senior Producer
"Rainbow Studios, a subsidiary of THQ, is one of the largest video game developers in the Southwest and develops premier original and licensed titles for current and next generation console systems. Rainbow’s video game history includes the critically acclaimed Motocross Madness PC series, the award-winning ATV Offroad Fury, top-selling Splashdown, the highly praised MX franchise, the blockbuster Disney-Pixar Cars titles, and the critically acclaimed Wii title Deadly Creatures, along with the soon-to-be-released MX vs. ATV Reflex."

Relic Entertainment: Environment Artist
"Your friends will call in the middle of the night, cursing you. When you see them, they’ll wear sunglasses to conceal their bloodshot eyes, and they’ll be alone, because their romantic interests left them without even texting goodbye. They won’t be able to stop playing. It’s a terrible fate, but I’m afraid it’s what we want. And we need your help."

Demiurge Studios: Senior Game Designer
"Demiurge Studios is seeking a talented, experienced Senior Designer to help lead our internal design team. A focus on communication, organization, iteration and polish are all critical attributes for our ideal candidate. Prior experience leading a team of designers and a demonstrable portfolio of game/level design across different genres are requirements for this position. If you can deconstruct reflex; if you can engineer adrenaline; if you can architect fun - we want to speak with you."

Sega of America: Senior Online Interactive Developer
"The Senior Online Interactive Developer will design and develop interactive online content including web sites, banners, promotions, games and other applications for the Sega family of web sites and other initiatives. The Senior Online Interactive Developer will be a part of the Online and Community teams as well as collaborate closely with cross-functional teams within the organization. This person will also manage staff and resources as necessary."

2K Marin: Engine Programmer
"2K Games seeks the talents of a seasoned and passionate programmer who enjoys a collaborative and creative work environment and is looking to work with like minded professionals to create a truly amazing game. Improve, maintain, and optimize the engine. Contribute to the design of a wide variety of enhancements to the Unreal Engine."

To browse hundreds of similar jobs, and for more information on searching, responding to, or posting game industry-relevant jobs to the top source for jobs in the business, please visit Gamasutra's job board now.

Playfish Cash Cards at Walgreens

research@gdmag.com (Soyon Im) — Fri, 06 Nov 2009 09:00:00 -0500

Playfish Cash Cards are now available at Walgreens in the United States. The next time you pick up your meds, shampoo or toothpaste, you can treat yourself to either a $10 or $25 card, good for buying virtual currency within Playfish's games, including Pet Society, the company's biggest cash cow.

This entry into retail stores is a huge step for Playfish and the social games industry overall, and signals the mainstreaming of virtual goods. Spending real money on an imaginary jacuzzi or a Halloween "mummy fish" will no longer be thought of as weird or fringe behavior. Clearly, you’ve arrived in middle America when your product is displayed next to Hershey bars and cards for Target and McDonald’s.

Initial reactions by fans are positive. Despite grumblings by a few who've nicknamed the company "Payfish," many gamers are rushing out to their neighborhood Walgreens, spurred by the cuteness factor of the pink and blue plastic. The cards also come just in time for the holidays—stocking stuffers, anyone?

The Sound of Music: Social Gaming's Audio Challenge

research@gdmag.com (Soyon Im) — Thu, 05 Nov 2009 12:49:09 -0500

Music is often considered secondary in game design, but it's crucial to setting the mood of any environment. Who can forget the gobble-gobble sound of Pacman or the lush orchestral tracks in Final Fantasy?

With GameSoundCon approaching next week in San Francisco, it's a good time to think about how sound enhances one's enjoyment of games—and perhaps even contributes to a game's addictive nature.

"Melody is the thing that gets stuck in your head," says musician Aaron Walz, who recently formed The Casual Game Audio Alliance with four other composers. The group's mission is to raise the value and quality of audio in social games.

Walz cites many challenges in composing for casual games. The melody has to be shorter online, yet just as compelling. "You have to balance aesthetic with file size and avoid being boring in the shorter format," he says.

There's also the dreaded mute button factor. With many online games being played at the office, many users turn off the sound as they sneak in a few minutes of play. But even people playing at home hit the mute button, because the music is often repetitive and gets on their nerves.

So which games get the music right? Here's my personal review of the sound in several social games:

- Farm Town (SlashKey): This game opens with a promising, symphonic sound, but it’s very short and repetitive, cycling in 10-second loops. Eek!

- Yoville (Zynga): When your avatar appears in another person’s house, you hear a synthesized sound reminiscent of the Star Trek transporter. More sounds are produced when you blow a kiss, throw a water balloon or send a gift. There's also the welcome trill of money piling up. But strangely, there's no sound for dancing or joking, two other prominent actions in the game. As a result, the soundtrack in this game feels unfinished.

- Pet Society (Playfish): I may be biased because I am a Pet Societyholic, but I have always found the music in this game charming. Unlike many other social games, Pet Society hits all the right notes and offers a rich variety of sound. You hear different tunes as your pet visits friends, goes shopping and fishes at the pond. Even the Pet Society Cafe is imbued with downbeat, lounge-y music. Still, according to one poll, 67% of users turn off the sound, which shows how challenging it is for even good music to be heard.

- Mobsters2 and Sorority Life (Playdom): Neither game has any sound. Where's the fun in that?

- Bejeweled (PopCap): Ah, the granddaddy of all casual games, Bejeweled has sharp, distinct sound effects as gems fall and click together. There's a rapid fusillade of gunshot-like noises when you hit a bonus. Bejeweled 2 on MSN.com and Bejeweled Blitz on Facebook took it up several notches by incorporating a deep male voice and sci-fi effects. When a level is complete, it looks and sounds as if the earth is cracking apart. When time is running out, you hear loud buzzes like emergency alerts on a spaceship. Sometimes, it feels a bit much. After all, this game is about putting same-colored balls and blocks together, not about conquering a galaxy. Still, it's undeniably more exciting to play with the sound on.

Here's a final thought: It would be nice to offer different music themes and allow the user to choose, much like selecting a skin on a website. If that's possible within the limitations of the online arena, I think many more social gamers will turn up the volume.

GDC 2010 Opens Reg, Details Reduced Pricing, Line-Up

research@gdmag.com (Simon Carless) — Thu, 05 Nov 2009 06:37:55 -0500

Game Developers Conference 2010 organizers have opened registration for the March 9th-13th event, confirming Social Game and iPhone Summits and revealing newly reduced price options for event passes.

The first two days of the San Francisco-based conference will feature a total of eight summits, two of which are new to the GDC lineup: the iPhone Games Summit and the Social & Online Games Summit.

New for GDC 2010 are reduced conference pass prices with the introduction of optional lunch packages. Attendees now have the option to purchase lunch provided by the Moscone Center based on their GDC week schedule, or to find their own lunch alternatives.

In addition, Game Developers Conference 2010 will see the return of the much-requested Audio Pass. This pass provides access to the Audio Bootcamp and all GDC Audio track sessions.

GDC 2010 -- produced by Think Services, as is Gamasutra -- will also play host to the GDC Expo Floor, the GDC Career Pavilion, the 12th Annual Independent Games Festival and the 10th Annual Game Developers Choice Awards.

"From year to year the Game Developers Conference continuously evolves its content to ensure that conference attendees receive the most current, relevant, and important insight into pushing the boundaries of what games can do," said Meggan Scavio, GDC event director. "We look forward to another eye-opening year of great content, speakers, events and awards, as well as sharing conference news and updates with the industry leading up to GDC."

Alumni registration for GDC 2010 ends December 17, 2009 and Early Bird rates end February 4, 2010. For more information on the 2010 Game Developers Conference, visit the official GDC 2010 website.

Zynga's De Loayza Talks Facebook Saturation, Clones

research@gdmag.com (Simon Carless) — Wed, 04 Nov 2009 15:59:20 -0500

The social gaming space is shaping up to be the industry's most major growth area in 2009, and Zynga is one of the space's frontrunners, operating some of the most popular games on Facebook.

Viral game mechanics that leverage the functionality of social networks are what drive the success of games like Zynga's FarmVille, Cafe World and Mafia Wars, which are currently the top three Facebook games for monthly active users. Cafe World alone has reached 28 million active users, 3 million of those in its first six days.

But the prevalence of social, viral games -- many of them thematically and functionally similar -- has industry-watchers concerned about market saturation. In today's feature on WiM.biz sister site Gamasutra, Zynga business development VP Hugh de Loayza addresses the issue.

"I'm sure that the audience reaches some degree of saturation. We all do, if we're spending a lot of time on there," he explains. "The trick for us is understanding new mechanisms that will inspire them to do that. It's also about good gameplay, right? That is a part of the gameplay, but it's also about building experiences that they want to share with others through the communication channels."

Companies like Zynga rival Playfish often criticize automatic-invite games that force users to send invitations and notifications to their friends, sometimes without prompting for consent. When asked about this, De Loayza says user response speaks for itself.

"If 18 million people are playing FarmVille, it's a game that they want to share with their friends, and it's an experience that they want to provide," he says.
"There are other opportunities for farm games, including [Playfish's] Country Story. It's a good experience."

In fact, Facebook gaming has solidified its own genres of gaming -- the "farm genre" among them. Many rival companies have similar but competing products, as with FarmVille versus Country Story. Given that these kinds of games are becoming so visible and so viral, is the similarity a problem?

"Our games are pretty distinctively different from the traditional Asian farm games. A shooter is a shooter, so a harvest mechanic is a harvest mechanic," De Loayza suggests. "But the story you wrap around it is different. The other thing to pay attention to is that you've got a service that you're running."

"The value is in that service, for the users," he continues. "If it's something that's constantly changing, you're in the same sandbox, but at the same time, it's a widely different experience all the time. It's the difference between Half-Life, which is basically a shooter, to Combat Arms, or whatever. It's the same shooting mechanism, it's just different services around it."

The full Gamasutra feature offers a thorough perspective from De Loayza on the burgeoning social gaming space and Zynga's position therein.

PlaySpan, PayPal Make Virtual Goods Buying Easier

research@gdmag.com (Soyon Im) — Wed, 04 Nov 2009 04:12:26 -0500

Anyone who sells stuff on the Web knows that it's too easy to lose a potential customer somewhere between the clicks. PlaySpan, a developer of monetization solutions for online games has teamed up with PayPal to make payments of virtual goods easier.

No longer will users have to go the extra step of opening a new window and be navigated away from their games. Over 700 games on Facebook, MySpace and Bebo will be affected, including Playdom's Poker Palace, Playfish's Pet Society and RockYou!'s Speed Racing.

It will be interesting to see how this partnership will affect the conversion rate in social games. It's nice to offer convenience to existing customers, but will a shorter line at the cash register be enough to convert a non-paying player?

While virtual goods is big business, the vast majority of players do not spend a dime on social games. Recently, I conducted an informal poll on Pet Society Anonymous to see how much money players spent on their virtual pets.

Out of more than 1,000 respondents, 6% spent about $20 per month, and 4% plunked down more than $100, but 86% said they didn't spend any money on Pet Society. Just time, precious time.

The Scamville Debate - Arrington Vs. Social Games

research@gdmag.com (Soyon Im) — Wed, 04 Nov 2009 03:07:39 -0500

Social gamers are being scammed. So says Michael Arrington of TechCrunch last weekend, who wrote that the big three developers—Zynga, Playfish and Playdom—use "completely unethical" methods of making money off players who think they’re getting free in-game currency for filling out an I.Q. survey or signing up for a free CD from Video Professor.

Read the fine print, and you’ll see that you’re actually paying far more (in the case of Video Professor, $189.95) for in-game currency than if you just paid cash. Arrington urged Facebook and MySpace to police this arena, but also accused them of “turning a blind eye to user protection,” because they’re getting a huge cut of revenue back from the games.

In response, Zynga CEO Mark Pincus acknowledged the problem while defending his company's position:

"Most of these offers are good for the advertiser and user. There are many users who don’t have access to online payment methods who are still interested in making in game purchases. There is also great potential for large web players like Amazon, eBay and Netflix to leverage social media channels like facebook and zynga to acquire new user relationships."

Pincus also claims that Zynga has “worked hard” to remove scammy offers:

"In fact, the worst offender, tatto media, referenced in the techcrunch article, had already been taken down and permanently banned prior to the post. Nevertheless, we need to be more aggressive and have revised our service level agreements with these providers requiring them to filter and police offers prior to posting on their networks. We have also removed all mobile ads until we see any that offer clear user value."

Independent blogger Andrew Chen also weighed in on the controversy. According to Chen, things aren’t so black and white:

"The more I dug into the issue, the more nuanced I decided it really was – things weren’t all bad, actually. In fact, I’ve come to believe that there are plenty of advertisers where this is working for them, plenty of consumers who are happy as well, though these offer guys are leaving a trail of unhappy users."

Chen agrees that the user experience sucks and offers some solid suggestions on how Facebook can better regulate the lead gens:

"In general, I believe the key to thinking long-term on the offers industry would be to expose all sorts of feedback information, out in the open, at a granular level... I think a lot of companies would hate it in the short run, and a lot of dollars might be banned, but long-term, this would be better for the overall ecosystem."

World Of Warcraft China Hits Snags Again In Gov Power Struggle

research@gdmag.com (Simon Carless) — Tue, 03 Nov 2009 23:00:39 -0500

It's not all green lights for World of Warcraft operations in China after all. Regulators have ordered new operator NetEase to halt Blizzard's MMO and stop allowing new accounts, claiming "gross violations" of rules -- and highlighting a rift between two different government groups in the region.

The transfer of WoW's Chinese operations from The9 to NetEase meant two months' downtime and a long closed beta for the game during the past summer, as it underwent a new round of regulatory approvals and content edits. China's Ministry of Culture approved the game's relaunch in September, having taken over some of the relevant regulatory responsibilities.

But many regulatory responsibilities are still the domain of China's General Administration of Press and Publication, which has now halted NetEase's application to run the game and demanded it cease WoW operations. The conflict appears to be part of an ongoing power struggle between GAPP and the Ministry of Culture over who controls online content. The GAPP has reportedly been displeased that the game's relaunch was approved without its input.

Analysts told Reuters that Chinese regulators have become increasingly concerned over "undesirable content" in online games. Among the edits made to WoW to allow its launch in China were the replacement of bone piles with sandbags, and a color change of enemy blood from red to a vague black mist.

The lack of specific age ratings for games in the country makes showing bones or the undead a gray area -- especially in light of a Chinese media controversy that occurred over a WoW subway advertisement that included undead characters.

The Chinese government is also cracking down in particular on foreign investments in its burgeoning online game industry, which is expected to grow 30 to 40 percent to $4 billion this year. GAPP has stated that foreign companies "cannot control or participate in domestic game-operating businesses indirectly through another investment company, signed agreements or by supplying technical support."

GAPP has also said that "foreign companies are neither allowed to covertly control or be involved in domestic gaming operations by means of joint networks for user registration, account supervision or game card systems." Such a declaration could pose a major threat not only to the future of NetEase's WoW partnership with Blizzard, but to the aims of numerous Western companies aiming to operate their games in China's high-growth online industry.

Conflicts over online games are unlikely to affect the existing game operations of other major companies in China, such as Tencent and Shanda, because they're believed to already be in compliance with regulations.

In an official statement, NetEase claims it's seen the GAPP's website statement of notification that it's returning NetEase's approval application, and its suspension instructions, but claims it's yet to receive official notification and will query the request to a higher level.

"GAPP also notes in its statement that it is evaluating whether to impose administrative penalties on Shanghai EaseNet," says the company's statement. "As of the time of this press release, neither NetEase nor Shanghai EaseNet has been officially notified of GAPP's determination."

"NetEase and Shanghai EaseNet believe that they are in full compliance with applicable PRC laws and are currently seeking clarification from the relevant governmental authorities regarding this statement by GAPP. NetEase will provide further updates on the statement by GAPP as appropriate."

[UPDATE: The Chinese Ministry Of Culture has held a press conference [Chinese language link] disputing GAPP's statements, following the latest developments in the saga.

The Ministry Of Culture is claiming that GAPP has violated a higher-level State Council provision on the approval process for online games. It appears that a ruling by the State Council at some point in the future will decide the controversy.]

Play This, Not That: Alganon Vs. TinierMe

research@gdmag.com (Soyon Im) — Tue, 03 Nov 2009 05:54:56 -0500

We at WorldsinMotion.biz receive mountains of press releases each week urging us to play the latest games. While we'd love to delve into each fantasy world, whether it be conquering a medieval kingdom or building a trendy cafe, we have limited amounts of time, especially since we're sneaking a few minutes here and there during office hours. How to choose what to play? Here's a quick guide to two of the latest offerings:

Alganon
Quest Online

A fantasy-based MMORPG, Alganon will soon be up for open beta testing before its official launch on December 1. A glance at their website shows a game dominated by commanding ~~chests,~~ deities, weapons, magic, and other usual fare.

Quest Online is betting that players will be drawn to familiar elements while gaining some new features over other MMOGs. The company is also putting a lot of effort into community-building through blogs and forums to guide new players. Already, the Alganon website has dozens of questions and answers.

Players wishing to participate in the Open Beta test will be able to join through numerous affiliate game sites including IGN via Direct2Drive/FilePlanet, MMORPG.COM, Curse Gaming, as well as the Alganon and MyAlganon websites.

WorldsinMotion Verdict: Play This! At least until the testing period is over. The artwork is worth a look, and it'll be interesting to see how robust Alganon's community will grow.

TinierMe
GCrest Entertainment

We admit, we were immediately drawn to the manga-style artwork of TinierMe. Who can resist big, watery eyes and long, rock-star hair? Plus, the game has over a million fans in Japan. But once we logged into TinierMe, we wondered if those million people were all under the age of eight.

The fun is limited to dressing up your avatar and waving hello to the guys and gals hanging out in the unfortunately named "Selfy Town." And while terms like this are awkward, the Engrish in TinierMe isn't nearly bad enough to be funny. Perhaps if it were, the game would attract a Western audience. As it is, TinierMe isn't any more intriguing than similar games such as Yoville, Sorority Life or even the static avatar designers in Yahoo.

WorldsinMotion Verdict: Skip This!

Gravity Bear and Sqlstream Announce Strategic Partnership

research@gdmag.com (Soyon Im) — Mon, 02 Nov 2009 07:05:44 -0500

Emeryville-based social games start-up Gravity Bear recently announced a partnership with SQLstream to bring real-time analytic technologies to social games.

According to their press release, SQLstream will allow for "real-time monitoring of virtual ecosystems and economies, placing Gravity Bear at the forefront of an all-new market opportunity that delivers game content to social networks faster and more efficiently than previously possible."

“Our strategic partnership with SQLstream will enable Gravity Bear to measure and understand how players are interacting with our games in real-time and respond faster than ever, delivering the online experience that players really want from social gaming," said Phil Shenk, co-founder and CEO of Gravity Bear.

It's great to see analytics used in this way, and I hope Gravity Bear will dedicate some time to following fan forums and blogs, in addition. Zynga and Playfish, for example, run very active forums, where players can ask, praise and vent about the games' features. Playfish's Pet Society forum has seen over 2.5 million posts, and even smaller forums begun by fans, such as Petsocietychatandtrade.com has over 2000 active members.

And the blogs... well, I may be a tad biased, but a new wave of fan bloggers really have the pulse on the games and the way people are using them in unexpected ways that surprise even the designers.

So fellas, if you really want to know what the players are thinking—yes, some gamers do think—go to where they're talking.

In-Depth: How Do In-App Transactions Change iPhone Games?

research@gdmag.com (Simon Carless) — Mon, 02 Nov 2009 02:12:52 -0500

How will the introduction of in-game transactions in free iPhone games affect the market? A Virtual Goods Summit panel including iPhone game notables ngmoco, SGN, Aurora Feint and Tapulous tried to find an answer.

Breen of SGN (F.A.S.T.) sees the change as profound and, essentially, immediate. "Every product that we intend to produce going forward will be a free introduction, and then you extend the product over time with transactions," he says.

Lacy with Tapulous (Tap Tap Revenge) already has implemented downloads in its pay games. "We have already been experimenting with virtual goods for the last month or so. We sell music -- that's kind of the ultimate virtual good, something people are used to paying for." He expects that the series' next game, Tap Tap Revenge 3, will be launched with a free version.

Young expects a sea change as well: "My sense is that the introduction of in-app purchasing is profound for the ecosystem." Rolando 2 has already been modified as an episodic title, but "we don't believe that the trial [version] with episodic content is going to be the dominant form."

Currency Problems

Though microtransactions are supported, they aren't that micro -- they start at $1, and in-game currency is not supported. This isn't as game-changing or appealing as it could be, says Breen. "There are still some restrictions on the iPhone... You can't have a virtual currency on the iPhone. The incremental ability to add items is restricted to, effectively, one dollar. I want to believe that barrier will eventually come down. The incremental spends are a little larger than I'd like to see."

Young, however, thinks the system is more flexible than developers realize. "I would recommend any iPhone developer to read carefully through what you can and can't do because it's more flexible than you would immediately think," he says. However, he says, "It might be useful if there were a pan-iTunes system for currency that allowed for smaller denominations than 99 cents."

The bigger issue is the backend for supporting these transactions, in Young's view. "If I were going to focus anywhere first it would be virtual goods management. The system, as it stands today, is just an extension of iTunes. The way in which you manage those items is pretty cumbersome, and a lot of work has to be done before developers can serve virtual goods."

Piracy!

Of course, one of the biggest points in favor of this system is that it will help stave off piracy on the platform. Says Young, "The real impact of in-app purchases is that it turns away the casual pirate."

However, says Young, it'll invite an endgame for the race to the bottom. "I think it'll create a race to zero on pricing. It seems inevitable to me."

Who is going to be affected most by this change? Though Breen and Lacy think small developers will be shut out (due to need to deliver high quality content on a consistent schedule) and large developers with expensive apps will be harmed, Young does not agree. "I am not sure it's a company size question as a company mindset question," he says.

Citron, of Aurora Feint, suggests that the situation will create such a change that it's tough to predict what effect it will have. "In a year from now, I think this ecosystem will be different." As developers drop out because they can't make any money, it might create a problem for Apple.

"It's really hard to say what Apple could do. People have been talking about this since the day the App Store launched. Part of what we're trying to do with our social platform is create a way for players to discover games socially and virally, like they do through Facebook. My thesis is that [virality] is going to have a larger impact."

Can Virality Drive Interest?

Young isn't high on Facebook Connect as a major driver of player interest -- or sales. "I don't think that virality is a function of having Facebook Connect. I think you need games that have the viral coefficient as core to the game design. You then look at the channels that you have for that virality, and all of the systems that cross systems are pretty lousy. And all of the ones inside systems like OpenFeint or our Plus network are finite."

To that end, ngmoco's Touch Pets and Eliminate have their own in-game social networking-style feeds, and viral user interaction as core game design.

Lacy is unsure that the markets are directly comparable. "The thing about the iPhone that people don't realize when they compare it to Facebook... What the iPhone does is that it's always with you. It's untapped that last goldmine of time that you have."

And when looking at the way gamers spend on Facebook, says Lacy, it doesn't necessarily map to iPhone. "We're still trying to learn about the elasticities of demand on the mobile side, and we're learning that they're very different."

While tiny transactions are more popular on Facebook, packs of six tracks outsell smaller packs of two tracks for Tap Tap Revenge. "There's a pervading mentality that what is happening on the iPhone is what happened on Facebook," says Lacy, but he does not agree.

Is The iPhone the Answer?

Of course, the focus of the panel is the iPhone -- but is there anywhere else to go? Android? DSiWare? "The iPhone is the only game in town right now," concluded Young -- going so far as to cut off the question when it was restated, with the same exact answer.

Says Breen in ending, "it's an indicator for where the market is going in all sectors." Other consoles are picking up on this, and more effective microtransactions are coming to Xbox 360, Citron points out, showing the importance of this business model going forward.

VGS 09: Industry Leaders Talk Top Lessons On Virtual Goods

research@gdmag.com (Simon Carless) — Sun, 01 Nov 2009 20:06:43 -0500

At the Gamasutra-attended Virtual Goods Summit 2009 in San Francisco, reps from leaders in the microtransaction-based market, such as Nexon and IMVU, discussed the nature of a successful virtual goods market based on first-hand knowledge.

Attending the panel, which was moderated by Lightspeed Venture Partners' Jeremy Liew, were Nexon America (Maple Story) vice president Min Kim, Dai Watanabe from DeNA, which runs Japanese mobile games portal Mobage Town, Cary Rosenzweig of U.S.-based virtual world IMVU, and Akio Tanaka, of Japan's Infinity Ventures, which exclusively and globally funds microtransaction-based products.

The Product You're Selling

The first question posed to the panel was the nature of the items themselves. What makes a good virtual product? Says Kim, "Everything we sell is functional. Whether it's a piece of clothing for your avatar or it's an item that helps you earn experience faster, there's some sort of function there."

Rosenzweig notes that though certain items are popular, what IMVU's users crave is choice, and that drives long tail business. "The top 10 items for people dressing up their avatars... represent 0.2 percent of sales of items. Our users demand to go deep, deep, deep into the catalog."

Encouraging Payment

Before you talk items, it's about getting users into your network, and getting them to pay. Watanabe maintains that user acquisition is key to sales. Mobage (short for Mobile Game) Town pulls users from its simple games into a broader community. "The key is how we can manage people to move from the game to the community. The game is what drives conversation among users."

"Once we successfully bring that traffic from the game to the community, we have avatars," says Watanabe. There are three key points to generating sales of items, he says -- what's in fashion (which requires constant updating), delivering rare items (which can be sponsored items, such as a Coca-Cola branded T-shirt), and giving users the chance to get new items from old items.

Rare items in Mobage Town are often delivered via a vending machine -- put in credits, and you have a small chance of getting a rare item. More recently, the service has introduced a concept called "avatar mixer", which allows users to drop old items and some money into a machine and get rewarded with newer, rarer items.

But the majority of IMVU's items, unlike in most MMOs or even many other non-game virtual worlds, are user-created. Says Rosenzweig, "Once users buy credits from IMVU and they're inside IMVU, we leave them to buy [items] from other users." IMVU considers itself "the eBay of virtual items," in that sense. He notes that the staff does pick items to promote to its user base -- but "when we try to pick the winners, we don't always succeed." IMVU attracts multiple subcultures, such as anime fans and goths, so items may not be broadly popular across the entire user base.

Tanaka notes that tracking player motivation on item purchases is important. "People spend a certain amount of money to express themselves, but they spend even more to impress others," he says.

"War has the highest ARPU," says Tanaka. People will spend even more to win in a conflict -- a Chinese colleague once said to him, "the ultimate motivation is to terminate everybody on your screen."

Watanabe notes that the more you obfuscate the exchange rate of real money into virtual currency, "people stop thinking about how much the currency is worth."

As an experiment, says Rosenzweig, "last month we did a sale for credits for only our VIP subscribers. We did a 50 percent off sale for one day... and revenue for the whole business tripled for that one day." Most importantly, this didn't seem to be people banking cheap credits ahead for a long period of time, as you might expect. "There was a slight slowdown on the next day or so but then it went back to average." This, coupled with an item sale, created an "upsurge in buying in the catalog." 

Tanaka notes that what's most important is making sure that you "don't underprice your items, because you may find much more upward mobility in your pricing range." He cites an example of the most popular farming game in Japan -- the operator wanted to start credits at approximately $1, but he counseled them to start their range at $5 -- "and it worked."

Flavors of Payers

Liew asked the panel about their top buyers -- a question that seemed to make the panelists uncomfortable. While nobody wanted to state it directly, there seemed to be a consensus that unhealthy or socially unacceptable motivations, like hoarding or seduction through gifting, are behind the behavior of some of these users. "The top buyers, if you look at the number you can just worry about if this guy's okay," says Watanabe.

Kim calls them "outliers." He doesn't target these individuals, Instead, Kim says, "What we're not trying to do is target a high ARPU. What I'm looking to do is have a lot of users paying something a lot more healthy a month." He suggests that "20% of your paying users will probably make up 80% of your revenue."

Tanaka said that gifting is a "huge part" of virtual item purchases. Stats revealed that 29 percent of men and 21 percent of women are buying items only to gift them to other users. "Virtual goods are going to cost more than real goods in some of the markets. And that's a real trend," says Tanaka.

The subject of offers is currently a hot topic in virtual goods circles -- rather than having players pay cash for items, you allow them to earn credit through offers such as free trials of Netflix -- which will see the video rental service paying the game provider directly for the acquired users.

Says Rosenzweig, IMVU experimented with showing its users a five minute ad -- and pegged the one credit payout, worth half a cent, at different lengths of time. At first it was the first five seconds; that paid out almost instantly. Thirty and 60 seconds also paid out quickly. Even two and a half minutes generated payouts -- at which point, "you are valuing your labor at 12 cents an hour," he says.

Making it Work

IMVU has jumped up in revenues, says Rosenzweig, because "in 2009 our focus was lasered in on increasing the number of people who paid us money. The first is the fundamentals -- we were improving the product. We had a big project to fundamentally change the user experience. The day we launched that, our core metrics jumped." The other factor? "The payment products -- once we launched them. People how they want to pay how they want to pay."

Though Mobage Town is mobile-only in Japan, the dynamics that drive it could map to systems like Facebook, it seems. Says Watanabe, "Eighty to 90 percent of our users are coming from word-of-mouth. We are giving some amount of virtual currency for a friend invite, but it works well because it's easy to pull up the contact list. And it's very easy to track these links."

When it comes to targeting specific markets, it's more than just the volume of users that's crucial to track, says Tanaka. "Japan and China have large internet populations but the value of users are very different." China has huge numbers, he says, but the average rate of activity is very low. Japan has fewer, but the users are very active.

"I would say that Japan's active rate is higher than Facebook," he says, and advertising to acquire users is worth it in that market because the users are so valuable. DeNA, operators of Mobage Town, paid "$5 per user" it acquired via a marketing campaign, says Tanaka.

VGS 09: Game Designers - Everything You Know Is Wrong

research@gdmag.com (Simon Carless) — Sat, 31 Oct 2009 20:10:59 -0500

Speaking at the Virtual Goods Summit in San Francisco on Friday, Zhan Ye, president of GameVision, commented that he has worked on traditional, single-player PC games as well as new free-to-play games in China.

In fact, he's brought experienced developers from the West to China and seen the culture clash -- because the two types of games, while seemingly similar, have important differences, he says.

Changing The Way You Think

"As I was working with designers in the U.S. and China, I couldn't help but notice the huge contrast between the old way of doing games that I was used to, and the new way I've learned from the young designers in China," says Ye. "You have at least three decades of history; in China, because the industry is so young, we don't have a lot of traditions."

"If you are a designer and you start on a free to pay project and you start with those old assumptions, you will fail -- no matter how good a designer you were in the old days," warns Ye.

"Ubisoft Shanghai has the best and brightest designers in China, and they were all trained by Western developers... but when they left and started their own projects, they all failed."

The End of Fun?

The assumptions designers make about games in the West just don't apply to the market, now matter how core and obvious they seem, he says. "As a designer, your first priority is to make the game fun." Well, not in China.

"In the old days, [designers] didn't have to worry about how to make money. It's the business people's evil job -- you just worry about making the game fun, and people will come to it. That's not true anymore," says Ye. "Making a game fun is not enough anymore. You have to operate under dual objectives -- you have to make a fun game that can monetize well, and those two objectives are equally important."

When he first met Chinese designers, Ye "was very surprised to find how much they talk about monetization from day one of the project" As a Western-style developer, "You can view it as a burden; it's a huge change. It changes your approach to game design completely. Every game design feature, you have to look at it from two perspectives."

Users Don't Want Art

When it comes to Western design, "Another assumption is games as an artform."

When the medium began to get more cinematic in the late '90s, says Ye, that idea has seriously taken root. "Starting from then [1997's Final Fantasy VII] video games began to be treated seriously as an artform. For over a decade, that's the direction the old game industry has been moving towards. In the free-to-play world, all of that might not matter anymore."  

The audience is what is driving that change, says Ye. "The gamers are paying attention to something else -- and as a game designer, you have to do the same thing. If you are still thinking about making a game as a piece of art that people can admire or respect, I think you'll be in big trouble." 

Content Creation? No, It's World-Building

Content creation is the primary focus of game development in the West, but Ye, again, says that's just not applicable to the free-to-play market. "I think the traditional game business, especially in the U.S., is based around buying or selling content -- you're buying a traditional game, you're getting 11 or 12 hours of content. And as a game designer you look at it from that perspective -- you want to do more and more content, better quality content."

When it comes to F2P, says Ye, "Consumers are not going to pay for content. Game designers don't feel like they're selling content. They just look at the whole game development from a different perspective. And from a logistic point of view, the whole purpose is to try and keep people playing for a long time, so they'll start to pay..."

Experience dictates, says Ye, that "if we can keep the gamers for at least two weeks, they will stay, and if they'll stay, they'll stay for years." However, he says, "It's impossible to create content for a year or two years of gameplay; you have to create an environment or a setting in which a lot of people can interact with each other. Ultimately it's not the content that keeps the people playing, but the people." 

Not Fair!

Western developers are also often deeply concerned with fairness. Says Ye, "A lot of old-school game designers think we should treat everyone equally in the game. They're worried that if we reward those people who pay more money, then the balance in the game will be destroyed and other people will leave. Those concerns are very valid."

Ye sees fairness as just another tool in the toolbox rather than as a core concept. "But in the free-to-play world, especially in China, a lot of game designers believe fairness is not a goal, just a means -- the goal is to create a highly dynamic environment and community where a lot of conflict and drama can happen; if it helps to create conflict, fairness and unfairness can be used as tools to create those conflicts and add tension to the game world."

In short, "If we believe a game world is a reflection of the real world, the concept of fairness in a game should not be taken for granted."

Ye discussed a game where to attract rich users who could afford to buy powerful items, poor players were paid by the company to stick around. "Rich people were just killing poor people all the same time -- but you just have to solve that problem." This created a "welfare state" in the game, and tarnished both the game's and the company's image.

A better solution, Ye said, in all seriousness, was a game that allowed users with a lot of resources to form clans and attract followers, gifting them with items. "If you think about who these people were in the real world, they were business owners, used to managing hundreds of people." Rather than letting rich users mow down poor users, "We let rich people fight with rich people with the help of poor people."

Monetization, aka Psych 101

Monetization is, of course, the key to the free-to-play universe. And, says Ye, "This is not an add-on. You have to think about this from the beginning of the project." In fact, he says, games that change from a subscription to F2P model "are a disaster waiting to happen."

So what's the answer? "You just have to try a lot of things. Chinese game designers have tried thousands of ideas." Ye suggests studying ZT Online, as it's known in China as the "encyclopedia of monetization ideas."  

When it comes to game design, in fact, there's an important distinction, says Ye. "Before launch it's monetization-driven; after launch, it's largely data-driven." Metrics are crucial.

And good social game design is rooted in an understanding of psychology, says Ye. "Good monetization design is based on a deep understanding of human psychology. The best game designers in Chinese people all understand what Chinese people want, what they think; their weaknesses, actually. Good free-to-play game designers are exploiting people's weaknesses in the game."

Key Impulses for Monetization

One tool for game design is conflict. "Conflicts make the game world more energetic and more lively," says Ye, but "more importantly they trigger emotions, and when people are more emotionally unstable, they'll make purchases."

Convenience items are important, but the recipe is not as simple as you think it is. Says Ye, "People will pay for convenience; however, what we found out is that convenience alone is not that powerful... you have to combine it with other factors. If you combine two or three factors you'll have a bigger chance to monetize."

For example, add peer pressure, and it becomes more more effective. "It's very easy to play with peer pressure," because of the volume of users in an MMO. One of the most popular items that Ye knows of is one that lets you respawn with your party when you die instead of returning to town. "Most people will say, 'I'll just pay', so they don't let their friends down." That's convenience and peer pressure rolled into one.

Items that allow players to show off in front of others are crucially important to the Chinese market, says Ye, "Especially if you create an environment where they're in front of their rivals or loved ones."

There's an item in one social game that is a gift -- of flowers. No simple bouquet, when the item is given, flowers fall from the sky and everyone can see them. Just as importantly, the game rewards the girl who gets the most flowers with a unique dress that can't be bought, and it will give her a special user title for chat. "[Girls] want to feel important, and being spoiled, that they're princesses. And there are a lot of male gamers who use online games as a dating tool."

VGS 09: Asian Virtual Goods Worth $5-7 Billion in 2009

research@gdmag.com (Simon Carless) — Fri, 30 Oct 2009 17:41:44 -0500

Benjamin Joffe, CEO of +8* (Plus Eight Star), a consultancy firm which brings the concepts of the Asian market to Western companies, delivered a presentation at San Francisco's Virtual Goods Summit 2009, highlighting the state of the market in Korea, China, and Japan.

When it comes to the size of the Asian virtual goods market, says Joffe, "This is an estimate I came up with a few months ago... Some calculations with online gaming and social networks, I said about $5 billion."

He now supposes that number could increase to $7 billion by new calculations. Though he says it's worth noting that "Asia is already more than the sum of North America plus Europe, in terms of internet users and mobile users."

These markets are drastically different and much larger than the U.S. at present, he says. China alone will have a $3.5 to $4 billion online games market for 2009, for instance, according to Joffe's numbers.

Japan has two mobile-only social networking services that draw 70% of their revenue from virtual item sales.

The top social network in Japan, Gree, has a 60% profit margin -- the top SNS (social network service) profit margin globally. Only 25% of its revenues come from advertising; 75% are derived from games.

This year, the U.S. market will be worth $1 billion, but notes that "the US market potential is somewhere between 3 to 35 billion dollars," says Joffe, somewhat jokingly.  

The question of which market delivered virtual item sales and microtransactions first is irrelevant, he says. Though the U.S. did some pioneering work, "Asia was the first place where the market reached over $1 billion dollars."

And while the top social games on Facebook are currently Western-developed, Joffe is sure that Asian competitors are coming with the big guns. One of the top 10 publishers for monthly active users, 6Waves, is based out of Hong Kong. China's Rekoo and Elex are at 30 and 36. "Execution trumps creativity in that space," says Joffe.

Round-Up: Gamasutra Network Jobs, Week Of October 23

research@gdmag.com (Simon Carless) — Fri, 30 Oct 2009 17:38:56 -0500

Each position posted by employers will appear on the main Gamasutra job board, and appear in the site's daily and weekly newsletters, reaching our readers directly.

It will also be cross-posted for free across its network of submarket sites, which includes content sites focused on online worlds, cellphone games, 'serious games', independent games and more.

Some of the notable jobs posted this week include:

Gazillion Entertainment: Project Manager
"We are seeking a Project Manager to be a key member of the Game Operations/IT Team. This is a full time permanent position and will report to the Director of Project Management - IT and Gaming Operations. Projects will vary from internal IT back office applications to key portions of a worldwide gaming operations infrastructure."

Insomniac Games: FX Artist
"FBI, ATV, CTU, ATF, SRPA, ETA, HR, TSA, OPEC, MIA, RSVP, RIP, CSI, WTF, WHO, FX, IMO, LOL - these are all acronyms- some real and some made up that everyone knows. Well we are looking for an FX wizard. We’re talking about creating those mind blowing fxs! Insomniac Games is looking for an artist to create effects to work and assist in gameplay, environment, and the cinematics of the game."

2K Games: Senior Publisher Producer
"Develop quality software products, from concept to release, as well as providing and maintaining the creative vision of the products for 2K Games. All candidates should be self-motivated, highly organized, and possess strong leadership and team-building skills. A Producer is a leader, above all else… capable of taking charge of a project (or external team) and unifying the project or group effectively toward a specific set of goals. This role requires the simultaneous management of multiple products."

5th Cell: Senior GUI Designer/Artist
"5TH Cell is about bringing together professional, talented game developers and artists to create award winning products. Our mantra is ‘Advancing Entertainment’ and we truly strive to both innovate, and creatively push the envelope with all our titles. Our team believes in the products we develop, and together with top partners, we are building a track record of successful original IP including Scribblenauts, Drawn to Life and Lock's Quest."

Nexon America: Online Community Specialist
"Be part of a creating and driving the communities around Nexon’s great lineup of games! Nexon needs a Community Specialist who can plan and execute social networking and media initiatives to increase positive player engagement within the Nexon gaming community. The perfect candidate is someone who is professional, goal-oriented, and a born leader. We’re having a ton of fun, and we need someone who can help our community do the same!"