5 Things happening in gaming right now that might make you TWITCH
#1 - GAMING IS OFFICIALLY A SPORT
The rise of eSports has ushered in gaming-as-a-sport, and this has changed everything. There are leagues, championships and prizes. There are plenty of advertisers and sponsorships. Both Red Bull and Coke have eSports platforms.
There are spectators and professional athletes who make their living from playing online and drawing an audience. This 30-something supports his wife and daughter as a professional Banger playing the golf game, Golden Tee, and this 22 year old expects to earn $200K this year playing Dota 2 online and traveling to tournaments around the globe. There is organized academia to recruit these athletes with State Department issued visas and athletic scholarships.
What’s driving it? Expanded broadband access and free-to-play games have opened up the audience, plus it’s just makes sense that it’s fun. Paul Tassi called it in Forbes, two years ago: “Games I already know and love are turned into professional sports, and I get to watch players compete at a high level of play while being able to follow exactly what’s going on? That’s an activity I can get behind."
The numbers. More than 70MM people worldwide watch eSports over the internet or on TVs. League of Legends has more daily active users than Instagram. (Very cool infographic here.) MLG has been holding tournaments on TV and online since 2002, and their viewership increased by 1,376 percent in Q1 of 2014. But more than 55 million visited Twitch in July of this year. It averaged almost 7MM viewers each day (the Game of Thrones season finale drew 7.1MM) and that was before Amazon bought it for $970MM. Deemed the ESPN of eSports, Twitch now is averaging the equivalent viewership of MTV.
Twitch uniquely delivers more for everyone, as it enables revenue streams for game developers, leagues, advertisers and individual gamers. It is like ESPN + YouTube. I can watch things on ESPN, but not upload my own content and make money from it - I can do both on Twitch. Look for Twitch to become more Amazon-like as they chase the audience levels of their rivals like Netflix. No doubt your Amazon Prime subscription is about to be loaded with a bunch of eSports content including tournaments, documentaries and music.
In their report "eSports video: A cross platform growth story", the Broadband Media Intelligence service at IHS credits services like Twitch for the current and future growth of eSports for its ability to aggregate viewers globally, thus achieving huge audiences. They expect eSports video to be worth $300 million per year, globally, by 2018.
#2 - VIRTUAL REALITY GAMING IS COLLIDING WITH MOBILE WEARABLE TECHNOLOGY
At E3, Facebook-backed Oculus Rift and Sony’s Project Morpheus battled it out over the ability to deepen the gaming experience for core gamers with their VR set-ups. Both previewed a variety of games and experiences (there was a shark), showing that developers are ready to get on board with producing games for VR. Both are playing around with different interfaces and control styles, and Sony’s headset appears to be more comfortable than OR’s coming out of the gates. Sony obviously has built in hardware with Playstation controllers and consoles.
But now Oculus has inked a deal with Samsung, which could swing the pendulum in favor of Oculus. Gear VR, which is basically a Samsung headset + Oculus software + Samsung mobile phone, solves a lot of problems for Oculus right away. 1) A new option to the not-as-comfortable Oculus headset; 2) The entry cost to virtual gaming goes way down - "The primary expense is something you already paid for: Your mobile phone," said Richard Greenfield, an analyst at BTIG. 3) A built in user base. The user base of Sony’s Playstation is impressive...BUT Samsung sold 300 million smartphones last year. This in turn solves the problem of "Having enough customers to convince game and other content makers to develop for the device", according to Amir Rubin, head of motion control technology firm Sixense Entertainment. And finally 4) Distribution: Gear VR fits right into Samsung’s already healthy wearable technology platform, so it works strategically for Samsung to provide lots of marketing support. Note: This just in today, Oculus people are saying consumers will want to buy both headsets - theirs and Samsung's.
#3 – MOBILE GAMES ARE THE POP MUSIC OF GAMING
The crazy moves of Angry Birds got everyone’s attention and then inspired others from all over the world to create their own instantly addictive Flappy Birds out there and the fans went wild.
Now we have a continuous pipeline of one-hit wonders battling for the top of the charts, (See: Kardashian won the summer and ended Candy Crush's long reign at the top of the charts). They are played as "short 45’s to relieve boredom or as the background music of our daily lives". These are not the same sort of games that you spend hours with, analyze the meaning of, play backwards and collect.
Mobile games have brought everyone into the tent and just like pop music, they’ll change over time to reflect pop culture, but are here to stay.
The numbers. By the end of 2014, mobile gaming is expected to reach $21.1 billion, up 19 percent from $17.7 billion in 2013, according to market researcher SuperData Research. And no one expects it to stop. "I really think we’ll see 4 billion people playing games,” said Michael Pachter, managing director at Wedbush Securities and a longtime gaming analyst, speaking at the Cloud Gaming USA conference.
The Asian influence. The Chinese mobile games market is forecast to grow at an astounding rate of 93% in 2014 over 2013, to $2.9 billion, and is expected to continue growth at a brisk CAGR of 37.6% through 2018 AND China is beginning to distribute mobile games via mobile chat apps, like WhatsApp, creating yet another distribution point. The Asian market will continue to drive growth, as China, India, and Russia are all markets that have large portions of their populations still waiting to pick up smartphones
What’s being bantered around now in mobile gaming is how to make money.
The most popular current model is a free download, and then the main revenue stream is from in game add-ons, but a low percentage of players buy add-ons, so only a small percentage of users are contributing to revenue.
And it's no surprise that with so many people playing, advertisers want in. comScore says that over half of the total time spent with digital media is being spent with apps. And 32% of time spent with apps is spent on gaming, And we know advertisers want in on digital media, so it makes sense that they'll want in on gaming. If advertisers are let in, we're likely to see versions of the Spotify model, with free play with ads or paid-for play with no ads.
The players. King is king. They have all of the top games right now, and are among the big players that analysts are betting on. The others include Activision Bizzard, Electronic Arts and Glu Mobile.
But the random success of the many Flappy Birds-to-come makes betting on continued dominance of any one player sort of a crap shoot.
The big developers are key players,but they generally don’t control their own distribution, so they can’t control individual artists/indie developers from self-publishing and competing on the same platforms.
Will it really end in the death of consoles? Pachter brings up the CD analogy here, and says we are seeing the last cycle of focus on consoles.
#4 – NO ONE REALLY KNOWS WHAT "INDIE GAME" MEANS ANYMORE, BUT IT'S MORE POPULAR THAN EVER
Indie games are games created by small, independent developers that don’t make much money and have smaller audiences. But: Minecraft.
Indie games are anything not coming from the big name developers. Except Sony.
Just like it was with independent movies, the idea of games being created outside of the compounds and the confinements of big studios is inspiring and brings out the Robert Redfords of the industry to lend support and create festivals/events where artists can showcase their work. In addition to the larger national indie game festivals, we're seeing more and more local festivals to showcase and encourage local artists.
YES, this is happening. Chicago had its first indie-gaming festival this summer put on by Bit Bash, and supported by Ryan Weimeyer of Chicago’s Indie City Collective.
Platforms like the App Store and Steam have made it easier for independent game creators to get their games distributed to the masses, without going through major studios, and it’s awesome.
Except that now it’s so over-saturated that no one can breakthrough. Which IN TURN is why some creators might be tempted to “sell out” to the Sony’s of the world.
Indie game creators are the Andy Warhols and Jackson Pollocks of our time. Yes! They are artists that want express themselves and tell their own stories without the influence of editors. And they’re even getting noticed and celebrated with their own museum exhibits. And they also experience anxiety about what's happening with their art form. They don't like that it's become too big and encroached upon.
Here is a video from PBS Digital Studios' show Game/Show that does a good job laying out the whole debate over indie games. The host, Jamin Warren says that the definition of indie has now boiled down to just how the game is marketed, and that so many of the games really shouldn’t be lumped together like they are. He votes for dropping the word indie altogether.
AND FINALLY, #5 – GAMERS ARE IN THE MIDDLE OF A HUGE IDENTITY CRISIS
#gamergate. It started as a spat between gamer journalists and the gaming community. One particular writer is known for calling out misogyny when she sees it in newly released games and unfortunately her criticism brought out the worst of the worst.
What happened next. A lot of online harassment, trolling and taking sides. #iamnotyourshield seems to be where gamers are siding with gamergaters and calling out the journalists for not recognizing the diversity of the gaming community. It’s confusing, but it seems like they hate the journalists, too. Here is a great synopsis of #gamergate from Vox.
An underlying cause of this easily flared anger and anguish could be that a smallish tight-knit community (filled with people that enjoyed self-identifying as part of said community) has expanded so exponentially and so astonishingly fast, which is great for all of the new people enjoying games and being gamers, but not so great for the original group of people with a now watered down version of what they were identifying with. Buzzfeed makes an interesting analogy to moviegoers here.
OH YEAH, AND THERE'S THIS.