GD Column 20: The Coming Storm

The following was published in the Feb 2012 issue of Game Developer magazine…

Ever since OnLive’s dramatic public unveiling at GDC 2009, the games industry has been watching and wondering about cloud gaming, at times skeptically, at times hopefully. The technology holds the potential to revolutionize the business, perhaps forever destroying the triangle that connects consumers with hardware manufacturers and software retailers.

Some of the immediate benefits are obvious. Instant, time-limited demos would allow every developer to showcase their games on-demand with no extra work. Frictionless per-day, or even per-hour, rentals would bypass Blockbuster and other rental chains, ensuring that more money goes directly to the people who actually make the games. Similarly, virtual ownership handicaps GameStop’s ability to resell a single disc multiple times, again making sure money flows directly from the consumer to the developer. Further, if a publisher commits fully to the cloud – with no offline version available – piracy would be virtually impossible

As for the consumer, cloud gaming enables cutting-edge graphics on any connected device, with no installing or patching ever. Although the system requires a constant Internet connection, more and more games – even single-player ones – are demanding a connection anyway. Indeed, cloud gaming can handle Internet stutters better than local gaming; in Diablo III, a dropped connection sends the player back to a checkpoint screen while OnLive returns the player to the exact frame she last encountered.

Most importantly for consumers, cloud gaming should change the economics of pricing. By removing the traditional retail middlemen, not to mention secondary drags on the system like rental and used-game sales, a developer could easily make as much money selling a game for $30 via the cloud as they could selling it for $60 via a traditional retailer. The industry could finally approach a mainstream price point, with games priced comparably to movies, books, and music – instead of the $60 price point (for a $300 console) which is absurdly out of reach of the average consumer.

Indeed, the economics could change for developers too. If entirely new business models emerge, with consumers paying for a game daily, weekly, or monthly – or perhaps with a single subscription to all available games (a la Netflix)  – the design incentives change. Cloud gaming could reward developers for depth of gameplay over ornate, scripted sequences; infinitely replayable dynamic games like Left4Dead or StarCraft might suddenly be more profitable than hand-crafted semi-movies like Call of Duty or Uncharted.

Rethinking Consoles

Cloud gaming also has important implications for the next generation of consoles. The ability to run games from the cloud gives the console makers a profitable alternative to both the rental market and the retail middlemen, all within their own closed systems. As a bonus, they could even sell inexpensive “cloud-only” versions of their next-gen console, without optical drives or hard disks.

Going down this path, however, raises the thorny question of whether consoles are even necessary at all. OnLive is already selling a “MicroConsole” that provides a current-gen console experience via the cloud; there is no reason similar technology can’t be included by default in new TVs, or even in any cable box or satellite receiver. What defines a console, after all? The three necessary elements are the controller, the screen, and the couch. Soon, anyone with those three things and an Internet connection to the cloud will be seconds away from any game.

Indeed, because cloud servers already dwarf current-gen consoles in horsepower, they can bring a next-gen experience to consumers today, by default. The cloud promises a “perpetual” virtual console that get updated regularly as new, faster servers come online. Publishers should be receptive as a perpetual console promises to end the boom-bust cycle they experience with each new generation.

Indeed, this year in the current generation’s lifecycle should be when publishers are making record profits. Instead, many are fighting just to stay in business; the next wave of forced upgrades could wipe them out. Anything that could prevent the gap years when consumers are forced to migrate between consoles would be a welcome change.

Thus, for the console makers, cloud gaming’s promise is mercurial – it could break them free from the parasitic drag of traditional retail but it could also destroy them by making the hardware itself irrelevant. The best defense against the latter is an active and direct relationship with the consumer, not tied to any one machine.

On this front, Microsoft, with its comprehensive Live service, is far ahead of Sony and Nintendo – many gamers would be hesitant to leave behind their gamerscores, achievements, friends lists, and downloadable games for another ecosytem. However, a radical step could cement this bond.

Because a thin video-based client can run on almost anything, any one of the console manufacturers could start the next generation tomorrow by simply buying OnLive or Gaikai and embedding it in the next system update. Next, they could sell cloud-only versions of the current-gen consoles for almost nothing ($100? $50?), which could revolutionize the market and inoculate the company from the coming shift. Some are predicting the next generation of consoles will be the last one, but it may not even be necessary at all.

Rethinking Games

However, cloud gaming’s potential is much, much greater than changing the economics of the industry; in fact, it could revolutionized the very way games are made. For starters, the cloud could solve the number one problem that plagues most teams – a lack of feedback from real players during the early stages of development when radical change is still possible. Most game project grow slowly from fast and nimble speed boats to hulking battleships which can only change course at great effort and cost.

Using cloud technologies, a team could expose its game to fans as soon as it is playable, with almost no technological hurdles or security concerns. All players need is a browser and, if necessary, a password. Releasing games early for feedback and buzz is nothing new for indie developers (indeed, doing so is their major competitive advantage); nonetheless, for major publishers, the idea is fraught with potential risk, of leaked games and bad press.

However, as the game’s code and assets would exist only on the cloud’s servers, nothing could be leaked. As for pre-release buzz, the greatest danger, of course, is of simply releasing a bad game, and the surest way to do so is to isolate a development team from the oxygen of real players. Further, the cloud’s inherent flexibility creates myriad ways to target players for testing: 24-hour passes, geo-locked sessions, early press versions, pack-in codes, and so on.

Further, the cloud promises more from these early test than some simple metrics or private forum comments. Because the output of a cloud server is a video feed, developers would have access to a recording of every minute ever played of their game. Wonder how players are handling a certain tricky boss? The designer can simply watch saved videos of many different players tackling the encounter.

Still, the greatest change cloud gaming could bring is the end of client/server architecture. Many online games have thin clients, with the “real” calculations being done on the server, largely to prevent rampant cheating. (As Raph Koster famously put it, “The client is in the hands of the enemy.”) With cloud gaming, the client is so thin that it might be inappropriate to even call it a client; it’s simply a video player that takes input.

The upside of this system is that developers would no longer need to waste resources developing a traditional game client, plugging its security holes, worrying about peer-to-peer connectivity, and optimizing what minimal, yet necessary, set of data needs to be sent to the client. In other words, making a game multi-player would now be essentially trivial.

Writing multi-player games is a formidable challenge – keeping game state in-sync between servers and clients in a safe, fair, and accurate manner is no small feat. With cloud gaming, these issues evaporate because there are no clients anymore. Developers simply write one version of the game, run it on a single machine, and update it based on user actions – which is how single-player games are made.

Taking advantage of this feature would require some courage as the developer would need to go all-in on cloud technology. Developing an online game with no client means that the game could only be played via the cloud. There are many benefits to being cloud-only – no piracy, for one – but the greatest benefit might be not even needing a network programmer.

Perhaps the group which has the most to gain from this new model would be small, independent developers, for whom the idea of building an indie MMO seems laughable given their tiny resources. One can’t help wonder what Mojang could do with a cloud-based version of Minecraft, seamlessly updated, playable from any device or browser, that connects every world end-to-end. So far, the big question for cloud gaming is when will it be feasible, but ultimately, the more important question is what will it enable.

The Road to Zynga

So, I’ve got a new job, which was revealed publicly in an interview at GamesIndustry International. I’ve actually been at Zynga for nine months now, so most of my games industry friends (and regular friends, for that matter) had known about it for quite awhile, making this move one of those “worst-kept secret” things. Surprisingly, the news stayed out the press, with the exception of an off-hand reference at Gamasutra during my first week of work! The turn of events which got me to Zynga is somewhat head-spinning, especially since I am now back in Maryland, working with Brian Reynolds, Tim Train, and a bunch of other former Big Huge Games people. I can’t helped be a little bemused because I was originally hired in 2000 to replace Brian & co. to finish (or, more accurately, to restart) the development of Civilization 3 after the mass exodus to BHG. Indeed, at the time, emotions were still a little raw at Firaxis, so my initial, second-hand impression of them was perhaps not ideal! Over the years, I got to know Tim and Brian in person, and I could always tell that their design culture would be a great fit for me if the opportunity ever arose. I didn’t always expect that opportunity to come at Zynga, but so far, so good. I’ll have a lot more to say on that topic once I can actually talk about my current project!

Here are some relevant bits from the interview:

Q: You’re the latest in a string of former EA employees to join Zynga. What do you think this says about EA and what does it say about Zynga?

A: The shift we’re seeing with industry talent moving towards social and mobile games illustrates the challenges of the old model. That model demands selling a $60 box product, which requires exceptionally high production values to sway the consumer. Of course, AAA production means development costs measured in the tens (or perhaps hundreds) of millions of dollars, which then requires a game to sell at least several million copies at the $60 price to be worth developing. This business model can work, but the margins are not great, and they keep getting worse as development costs increase and retail sales soften. One of the bizarre paradoxes of this system is that some mid-tier games cost too little for traditional games companies to fund because the company needs to put all of its organizational weight behind a few key titles.

Mobile and social gaming suddenly became very attractive for game designers because they circumvent this problem entirely. As these games require a fraction of the cost of AAA games, radical new ideas can be tried out fairly easily and with little institutional pressure. Further, feedback is much easier to gather from the Web or connected smartphones, and teams can continually course-correct with regular updates. The old system of expensive, multi-year development, cut off from the oxygen of player feedback, suddenly became much less appealing.

Q: Given your experiences in the past on Civ IV and Spore, how well does what you’ve learned on traditional games apply to the social space and Zynga’s approach?

A: Fun still happens inside the player’s head, and that doesn’t change from platform to platform. What does change is that certain design possibilities are unlocked with each new technology, such as zero account overhead, assumed persistence, guaranteed connectivity, pre-made friends lists, built-in viral channels, universal access, and ever-improving game engines. These features let us explore areas of design that were previously unavailable. Indeed I feel like my work right now is a direct continuation of what I have done in the past, and I am simply using my twelve years of experience as a strategy game developer to take advantage of these new possibilities.

Q: Are you coding, or designing, or some of both?

A: I am doing the code and the design for the project, just as I did with Civ IV. I like working this way because I can spend less time explaining how I want a feature to function and more time watching how it works out in practice. I am using a somewhat unusual technology solution (GWT/PlayN) that enables me to write a HTML5 game in one language, including client and server, which means I have no duplicate, error-prone code and a very consistent style. Of course, doing code and design could make me a major bottleneck as the project grows larger, but one of the advantages of strategy games is that – because they are rules-driven instead of content-driven – a small amount of code can create a large amount of gameplay. Thus, extra engineering resources will be dedicated to features that work in parallel to the core game – scalability, UI, matchmaking, metrics, modding, and so on.

Q: Can you give us any hints at all about what your game project at Zynga entails?

A: I’m afraid that it’s too early to reveal much about what I’m currently working on, especially since a lot could change between now and our release date. However, I can say that I am working on a game that would not be a shocking departure from my development history, but one that is multiplayer-focused, free-to-play, persistent, and playable in the browser. Most importantly, the game is one that actually ends, with real winners and real losers. That’s a big departure for Zynga, but it’s a necessary element for many types of strategy games. Decisions matter in vastly different ways once games have an actual victory condition. Put another way, a bit of a level race does exist in persistent MMOs like World of Warcraft, but ultimately the race is just with yourself. No one else really cares how much time you put into your dwarf cleric. On the other hand, it’s a powerful feeling when you beat someone to a wonder in Civ IV.

Q: Do you see social games becoming more like familiar PC or console games in terms of mechanics?

A: After a couple years the term “social gaming” came to mean different things to different people, and many traditional game developers simply use the term to describe “games on Facebook that we don’t like.” On the other hand, some of the biggest hits (Words with Friends, Bejeweled Blitz, Draw Something) are not really thought of primarily as “social games” but simply as great games that take advantage of the possibilities of social gaming – guaranteed connectivity, account persistence, meaningful friends lists, etc. Therefore, the best-case scenario for social gaming is for the term itself to disappear as all games become more social, even ones that are traditionally thought of as primarily single-player. For example, consider how friend-based leaderboards drive the experience in console games like Trials Evolution or Burnout Paradise.

Ultimately, gameplay is determined by the input and output of the devices we use, which enables and encourages certain types of play, and there are currently three important formats – the consoles (defined as gamepad, high-def TV, couch-based), the PC (keyboard, mouse, monitor, desk-based), and mobile (small screen, touch-based, omnipresent). Consoles will continue to dominate avatar-based games as controllers are built to “pilot” characters or vehicles. PCs are the natural home for more complex games because of their precise input and “lean-in” environment. Mobile is perfect for asynchronous gaming, and the touch-based user interface creates entirely new types of games just like the Wii did with motion-based controls. The best games will take advantage of the unique power of their formats, which is why we shouldn’t necessarily expect Facebook games to suddenly become Halo.

Q: What’s your take on the impact of social and mobile games on the traditional console business model?

A: What’s interesting about the games business right now is that we have four different business models operating at once. For console games, retail still dominates with increasing revenues from microtransactions. On the PC side retail is dead, but traditional, single-purchase games still thrive on Steam. Furthermore, free-to-play games from CityVille to League of Legends can succeed purely via microtransactions. On mobile devices, the app store dominates with the big money coming from in-app purchases. Over time, these four models will almost certainly merge into one consistent system. We have already seen plenty of convergence; Steam made a big push to support microtransactions and free-to-play games while in-app purchases were an important later addition to Apple’s App Store. The big question is the next generation of consoles. The benefits of fully embracing an app store model are obvious, but there are many entrenched interests and historical relationships slowing down that transition.

App stores, in general, are very interesting simply because they make it possible to actually charge players for small-scale games. For example, there is no reason why I shouldn’t be able to buy Ascension for $4.99 to play in my browser, but the tradition simply does not exist to “buy” web pages. On the other hand, the Apple App Store combines frictionless purchasing, flexible pricing, automated submissions, and an enormous audience to create a market for games which didn’t exist previously. At some point, the importance of the browser (with open standards and cross-device support) needs to combine with the ease of the app store (with a standardized purchasing model), to hopefully create an even better system.

Q: Do you think the kind of hardcore PC player that you targeted with Civ IV will want to play your next game at Zynga, or do you have to change your design philosophy to cater to a new, more casual audience?

A: I expect Civ fans will absolutely be interested in my current project at Zynga; in fact, I anticipate them to be among the first wave of players to try out the game. As with Civ IV, I will be trying to make the game as simple as possible to keep it accessible for any kind of player. Remember that Civ itself is no typical strategy game and has an audience which is an order of magnitude larger than any other turn-based strategy game. The reason is that the series is infused with “Sid’s design parsimony” (to borrow a phrase from Chris Crawford), refusing to pile on more and more rules and mechanics in the name of realism. I hope to carry this tradition forward to make a game for every gamer.