Trends with Benefits: Puzzle Species

Take a swing at this week’s Trends with Benefits, the weekly brainteaser from your friends at TriplePoint! TWB appears every week in our news round-up, Points of Interest, and offers terrific prizes to readers who can puzzle their way through the challenge du jour. First crack at the prizes go to Points of Interest subscribers when the newsletter goes out on Fridays, but we’ll be sharing each week’s challenge here on our website, as well.

This week’s challenge is for a lovely new RockYou t-shirt! Read on for your chance to claim it.

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Fantasy University Opens – Schools Facebook Gaming

Too late for back-to-school news?  We don’t think so.

Facebook – meet Fantasy University, the latest project from veteran development team Simutronics.  Since 1987, Simutronics has been entertaining millions with games such as GemStone IV, the longest-running commercial MUD in the world.  If CEO David Whatley and company could turn text-based games into entertainment enjoyed by millions, imagine what they could do with Facebook.  Ladies and gentlemen, welcome to Fantasy University.

Fantasy University combines snarky humor, endless pop culture references, and the FUBAR (the game’s form of virtual currency) with solid, RPG gameplay.   Facebook, a platform that has been subject to mounting criticism by gaming journalists (and sometimes ignored altogether), is now host to emomancers,  slackninjas, mathemagicians, cheermongers, and dodgebrawlers.

There’s plenty to say about F.U., but sometimes game art speaks louder than words.

We’ll be playing right along with you – don’t be late for school!

(“Facebook Credit” – get it?)

Congratulations Jambool – The Future of Virtual Currency at Google with Social Gold

By now, you’ve most likely heard the news, but it is never too late to send congratulations over to our client, Jambool, whose virtual economy platform Social Gold has received plenty of attention over the past year – most recently after Jambool’s acquisition by Google.  As the social gaming and virtual goods industries continue to grow,  we look forward to seeing what our talented friends at Jambool can come up with next at Google.

Frisky Mongoose: Why Do We Play Social Games?

I think it’s a bit harsh to say that social gamers are “weird”, as Newsweek recently put it… But you have to dig a little deeper than face(book) value to understand the attraction of playing casual games with actual friends on the (social) web.

In the end, it all boils down to the fact that people like playing games with their friends, and the Facebook platform allows new audiences to enjoy a “gaming community” atmosphere in a familiar setting (Facebook) with people they know, and games they can learn to play easily and that don’t require a large time investment to enjoy (social gamers are busy)!

It’s more fun to beat your friends than strangers, and social games can even lead to better connections with Facebook friends you don’t know very well, or otherwise wouldn’t have a chance/reason to interact with on a regular basis.

Continue reading Frisky Mongoose: Why Do We Play Social Games?

Social Gold Drives Repeat Purchases of Virtual Goods

Social Gold, the premier virtual economy platform, has recently shared some intriguing facts on users’ spending behavior within social games. Social Gold offers users a seamless in-game payments experience so players can purchase virtual goods without disrupting gameplay. New stats that were recently  posted on Social Gold’s blog show that their virtual economy platform increases conversion and drives repeat purchases.

Continue reading Social Gold Drives Repeat Purchases of Virtual Goods

Virtual Goods Generate 1.6 Billion – New Payments Solutions Make It Even Easier to Purchase Goods

Inside Network recently released a report that the virtual goods market is expected to drive $1.6 billion in revenue in the U.S. in 2010. The market is driven in large part by virtual items sold in social games, which account for $835 million of the total sales projected. While publishers such as Zynga, Playfish, Playdom and Serious Business are hard at work creating the content and engagement mechanisms to drive sales, payments solutions such as Social Gold (online), Zong (mobile), Open Network Entertainment, Inc. (prepaid cards) and the newly launched Kwedit (cash) are striving to help customers purchase those virtual goods seamlessly.

Today, Kwedit launched their new payments services (Kwedit Direct and Kwedit Promise) in partnership with Social Gold. Thousands of online games and virtual worlds currently using the Social Gold virtual economy platform now provide access to the Kwedit service. The service enables players to purchase digital goods online, and then print a receipt with a bar code (or save it to their mobile phone) and pay for the goods at a retail store in cash (or mail in cash via a postage paid envelope). For the millions of tweens and teens in the US without debit or credit cards, also referred to as “the unbanked masses,” paying for virtual currency and goods with cash is the only option, and this new solution will make it easier for publishers to monetize this growing market.

What’s also particularly unique about the Kwedit payments service is that customers are on the honor system when it comes to actually paying for their virtual goods. Customers are asked to pinky swear that they will pay eventually, and if they don’t, then their virtual Kwedit score will decrease (much like a real FICO score) and it will be much more difficult to obtain Kwedit to buy more virtual goods. Does this teach kids about financial responsibility? Possibly.

The Kwedit service is a very unique alternative to direct purchases via a credit card, PayPal, or even a prepaid card. TechCrunch’s Michael Arrington gave the new payment service a glowing review, calling it brilliant. It will be interesting to see how the service performs in the competitive payments market, and whether cash-paying consumers will quickly adopt the model.

Meanwhile, while I play Mafia Wars and, inevitably, buy reward points to boost my experience level and sharpen my attack and defense skills for big boss fights, I’ll be thinking about how these payments solutions are making it faster and easier for me to make those impulse purchases. When I’m just a few simple clicks away from receiving that instant gratification, the term “buyer’s remorse” doesn’t even cross my mind. As the market appears to be on track to exceed last year’s sales of virtual goods by over 40%, I suppose we have the obsessively engaging content and also the increasingly frictionless purchasing experience to thank for this!

GDC China 2009: Adventures in Shanghai

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After a brief hiatus in 2008, GDC China returned in 2009 with a three-day conference held in Shanghai, and TriplePoint was there to soak it all in. We were bowled over by Shanghai’s incredibly dynamic spirit and international influences, not to mention some of the best food we’ve ever consumed (seriously). There is so much to learn, and the trends below represent the tip of the iceberg; we can’t wait to return next year and continue our education about the world’s largest gaming market.

Here are a few key takeaways from our experience:

The Chinese market presents massive opportunities

The opportunities for Chinese developers and publishers within China are vast, and many are choosing to focus on this market rather than looking Westward. With over 330 million Internet users and an audience passionate about online games, the challenges of localization, culturalization and operating in the US don’t need to be solved right now. The US market has almost 200 million Internet users, and a developer must capture at least 2% of the online gaming audience to become profitable, whereas developers in China must capture only 0.2% – 0.8% of the online gaming market to become financially successful. And the market is growing rapidly, with a projected size is $900 million by the end of 2009, up over 39% from last year. That’s not to say that our market doesn’t matter: Some say that the Chinese online gaming space could be saturated in two years, prompting movement into the US and Europe, and the leading companies are exploring opportunities now.

Government politics play a large part in the games industry

The political situation surrounding World of Warcraft in China was a hot topic while we were at GDC, and remains so, with operator NetEase caught in the middle of a battle for control between the Ministry of Culture and the General Administration of Press and Publications (GAPP). The outcome remains to be seen, and will impact any games operated in China. For the latest, we recommend this article: http://www.google.com/hostednews/ap/article/ALeqM5hU1YNKGtJmAZA0DGIvMUXrAyurlwD9BOPRIO0

Avoiding risky business by playing it safe

In the Western world, original IP is king. We associate creativity, value and integrity with original IP and unique gameplay. In Milan, Italy at the second annual Italian Game Developers Conference in early October, we witnessed the value and importance associated with creating and owning original IP. In the Chinese gaming market, it’s quite different and according to several sources, developers struggle to secure investment funding for their original IP. Instead, proposing to develop a product similar to an existing successful game demonstrates less risk to potential investors and results in a higher chance of receiving funding. Additionally, from a marketing perspective, it’s generally believed that a game in line with existing trends will garner success in the market.

Roots run deep and come to life in games

Chinese history and culture are common themes in online games, as reflected by such titles as Fantasy Westward Journey, Sangokushi Online, Zhengtu and Sho Online. During conversations with developers and publishers, we heard many times that games with references to Chinese history or culture will not resonate with Western audiences, and therefore have little relevance for other parts of the world. Korea-based publisher, Joymax, has experienced success attracting international audiences with their free-to-play MMORPG, Silkroad Online, which draws in players from 180 countries from around the world. It appears that there is a potential opportunity for Chinese developers to explore publishing historically-based games in other markets.

New platform developments on the forefront

Around the time of the conference, Unicom announced the launch date for the iPhone in the Chinese market, opening the door to this mobile platform for game developers in China. While iPhone game development wasn’t a focus at the conference, it’s certainly a new market opportunity and it will be fascinating to see how the platform fares. Additionally, we spoke with several developers creating social games, primarily for Facebook, even though the site is blocked in China. Chinese developers are testing out social games by launching them on U.S.-focused social networks, which they then monetize, and leverage the results for building social games for the Chinese social networks. A big difference between social networks in China and the U.S. is that the Chinese social networks require that you submit your social game application for review before it is published on the site, so testing and fine tuning applications in the open publishing platform of Facebook is highly valuable.

What’s next? And the big opportunities

It was apparent at this year’s GDC China that there are numerous opportunities for both Chinese and U.S. game developers in each market and that both sides may be looking to expand in the near future. The general feel from the conference was that China is looking forward to the opportunities presented within the games market, such as new platforms and new distribution channels. The attitude can be summed up by a response to our appreciation for the Shanghai skyline: “It’s impressive now, but just wait until 2010!”

Written by Kate Pietrelli and Eddiemae Jukes

Entry way to Shanghai International Convention Center for GDC China 2009.
Entrance to Shanghai International Convention Center for GDC China 2009.
With badge and lanyard in place, TriplePoint's Kate Pietrelli is ready to attend GDC China 2009.
With badge and lanyard in place, TriplePoint's Kate Pietrelli is ready to attend GDC China 2009.
TriplePoint's Eddiemae Jukes and Kate Pietrelli visit the Yuyuan Pagoda in Shanghai.
TriplePoint's Eddiemae Jukes and Kate Pietrelli visit the Yuyuan Pagoda in Shanghai.

Social Gaming Summit – A Brief Lexicon

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Step away from your farm, restaurant or jewels for a few minutes for a quick overview of the Social Gaming Summit through the top terms of the day:

Virality and the “viral loop” – Virality, or the ability of something to grow virally, is a critical factor in the success of a social game. In a few words, the viral loop refers to the cycle of growth created by friends inviting their friends to check something out, and those friends converting and then inviting more of their friends. Virality has the potential to create non-linear growth for a user base, and discounts the customer acquisition cost, so unsurprisingly it came up frequently throughout the event. There were some interesting discussions about the difference between virality designed to be a customer acquisition tool (“mechanical virality”), and virality that emerges from good old fashioned enjoyment of a game, and the resulting word-of-mouth support. In other words, it’s the difference between incentivizing users with in-game rewards for inviting friends to play, versus users loving a game and naturally wanting to encourage their friends to play with them. Are players acquired through mechanical virality valuable? There are many questions here, but it seems that everyone agrees that word of mouth virality lacks the playbook of mechanical virality and is much harder to achieve.

Facebook Connect – Though this is not a new offering, it remains a hot topic. Facebook Connect enables users to take their online identity with them all over the web, onto gaming consoles such as the Xbox 360, and to the iPhone. What does this mean for social game developers? It means that players can interact with games designed for Facebook (a great platform in terms of virality) across multiple platforms – extending and deepening the experience. It’s doubtful that everyone wants their real identity tied to all of their gaming identities, but that’s a discussion for another time…

Social graph – Your ever-expanding network of relationships with friends (and not-quite friends), your “social graph,” enables and defines the social gaming experience. The social graph makes social games fun and enables virality. And it goes both ways: social games can strengthen your social graph by creating new experiences beyond “poking” and staring at photos of your ex-roommate’s cousin’s dog.

Fun – Games should be fun, and more than any design considerations born from number crunching, it is fun that makes people – and their friends – want to play a game. PlayFish CEO Sebastien de Halleux noted that their key metric is whether or not the entire company can’t stop playing a game. This remark was referenced throughout the rest of the conference and served as a great reminder of what games should be all about (fun).