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The gaming industry and its limits
The gaming industry has long operated on the basis of pay to play, meaning that players had to pay in advance for a game in which they had no guarantee of having fun and with the certainty of reselling it, at a loss, on the second-hand market.
On top of this disadvantageous model for players, often considered as a consumption and not an investment, have been grafted models of dubious and abusive commercial practices against players, such as game extensions.
Video game expansions, or add-ons, are additional paid content that the studio behind the game offers for sale, in order to enrich the player's experience, by adding content, at the cost of the player doling our further cash.
Video game add-on can bring additional levels, equipment, weapons, graphical elements, scenarios or campaigns.
Very often, the extension is intended to revive the interest of a game, sometimes taking advantage of a twist of the original scenario.
These extensions are even, sometimes, elements of the game present on the original disc, but locked by payment in addition to the payment of the game, which can be considered a malicious practice for game studios.
Let's also talk about DRMs.
DRM, or Digital Rights Management is perhaps one of the worst things for consumers to deal with in the digital age.
It is software that is developed strictly to restrict what the users can do with the software or the device that they purchased.
Unfortunately DRM is very commonly used amongst some of the biggest competitors in the technology space.
Microsoft, Apple, Sony and Nintendo are some of the most notorious companies that have implemented very strict DRMs into their software and devices.
DRMs are a threat to freedom, because, even after buying the right to own and use a digital content, users are still restricted in the accessibility on how they wish to utilize or dispose of their purchase.
The Icing on the cake are the mandatory subscriptions that companies implement for access to certain online games.
Many online games are subscription based. This is the case for most well-known video games, for example World of Warcraft, which posed a financial constraint that was difficult for players to sustain over time.
WOW is a perfect example of how players wish to free themselves from this unsustainable subscription-based model. Although wow is beloved by many & the game is still considered among the best in its genre, players continue to flock to cheaper more inclusive alternatives.
With the arrival of mobile games, saw the rise of the freemium model, allowing players to be able to enjoy the game without being obliged to pay, but instead strongly encouraged to purchase in-game assets that can enhance their gaming experience
It turned out that this economic model can be much more profitable for the companies behind these games, but the user finds himself spending, without realizing large sums for little long term benefit.
A combination of the words "free" and "premium," freemium is a type of business model that offers basic features of a product or service to users at no cost and charges a premium for supplemental or advanced features.
A company using a freemium model provides basic services on a complimentary basis, often in a "free trial" or limited version for the user, while also offering more advanced services or additional features at a premium.
At the same time, the arrival of mobile games has attracted a new category of players, called casual gamers.
These players, who are mostly mobile-first, enjoy playing simple and quick games.
They don't expect familiarity with a standard set of deep mechanics & controls.
A casual game is a video game targeted at a mass market audience, as opposed to a hardcore game, which is targeted at hobbyist gamers. Casual games may exhibit any type of gameplay and genre. They generally involve simpler rules, shorter sessions, and require less learned skill.
The business model of these games is often linked to advertising, but also from in-game currency purchases, skins and elements.
Countless casual games have been developed and published, alongside hardcore games, across the history of video games.
A concerted effort to capitalize on casual games grew in the 1990s and 2000s, as many developers and publishers branded themselves as casual game companies, publishing games especially for PCs, web browsers, and, after 2007, smartphones.
Hyper-casual games are mobile video games, with minimalist UI, that are generally easy & free to play and generally free to play.
They also often use 2D design with a simple color scheme & easy yet addictive mechanics that keep players locked into a somewhat infinite loop of hyper casual gameplay.
Since the vast majority of hyper casual games are free & lack robust in game economies, revenue is generally created from ads that they display to their player base regularly throughout the gameplay experience.
Hyper-casual games gained a foothold in mobile gaming in 2017, but have always been seen as a genre similar to the 1970s video games, which lacks detailed design and gameplay.
The first hyper-informal game to gain widespread popularity was Flappy Bird, which recorded more than 50 million downloads and peaked at about $ 50,000 a day. Since then, hyper casual games have dominated the top charts in many mobile game stores, such as the Google Play Store and the App Store (iOS).
According to ironSource, hyper-casual games occupy 10 of the 15 most downloaded games.
Compare that to a year ago, when there were only 3 hyper-casual games in the top 15, it is plain to see that hyper casual gaming is one genre that is rapidly gaining popularity within the industry.
According to EEDAR, most mobile video game users play while multitasking, due to their simplicity. This ease of use has lead to hyper casual games becoming increasingly popular with their users.
In an interview with ironSource, Destruction of Fun founder Mishka Katkoff explains :
“As casual games implement deeper, mid-core features they become more engaging, but also more complicated. This, in turn, opens up a segment for hyper-casual games to dominate – games that are easy to start and fun to play.”
Over the last year, a new gaming business model called play to earn has rapidly risen in popularity.
Players are invited to play games and monetize their time playing and being rewarded with tokens, fungible and non-fungible.
The first big success of this model is Axie Infinity, developed by Sky Mavis, allowing users who hold 3 NFTs to fight in PVE (player versus environment) and PVP (player versus player) and earn token called SLP, which act as reward for gaming time.
Create an original and fun game is already a tough mission. Create a healthy and sustainable token economy is also quite a challenge.
Mixing both is a sorcery that no P2E project can claim they have reached, because so many paths remains to be tried.
This model therefore mixes a video game with an economy based on one or more tokens.
In current Play to Earn games, players are most of the time forced once again to invest in advance by buying fungible tokens or NFTs with a large sum of capital in order to be able to play a video game that they have not tested in the first place.
The ultimate point is that developers have to make the choice between a great game and a great economy.
1. The first type of P2E favors the economic aspect over the game itself.
These P2E become the best case of gamified DeFi protocols that are absolutely not fun but with an astronomical market cap, which is decorrelated from its intrinsic value.
In the worst case, those games can hide ponzynomics where the main objective is to "pluck" players and speculators due to an unsustainable tokenomics over time.
These systems are by design going to an end, because they are either unscalable, or too dependent for fresh investors to pay the early adopters.
2. The second type of P2E is more player-wise but only rare games have been developed and most of the time the economics is disappointing.
Lots of game creators focus on making a great game but want to surf on the buzzwords and announce their own "metaverse", implementing a tokenomics wrongly adapted to the game.
It creates a cool game to play with, but the failed economy will downgrade user experience, because who want to invest in a nice P2E economy when they know it's aimed to collapse at any time?
Down the road, the one always losing are the consumers, players and/or speculators.
It is based on these assumptions that Octo Gaming worked and is proud to announce its Play & Score to Earn hub of hyper casual games, changing the face of the blockchain gaming standards.