Psychochild's Blog

A developer's musings on game development and writing.

24 May, 2011

The wheels of fortune
Filed under: — Psychochild @ 11:20 AM

At the recent LOGIN conference, I was on a panel entitled “Wannabe Farmers replacing Pretend Mass-Murderers: Are Social Games a Fad?” To make the panel more interesting the panelists took extreme positions, and I was the solid “social (network) games are a fad” guy. Not that I believe that entirely, but it made for an entertaining panel discussion. (I’ll post a link when the talk is posted online.)

But, I mentioned something that I think is very true: business works in cycles. And, by looking at previous cycles we can use them to divine the future of the current cycle. Let’s take a closer look, shall we?

The great wheel of fortune

The wheel of fortune is a mythic image, where people attached to the wheel travel up, closer to the sky, on one side and down, usually into suffering, on the other. It’s a symbol of things changing, a representation of the clichĂ©, “what goes up must come down.”

This cycle is evident in business. The clearest example in computer games is the console cycle: the announcement of new consoles spur a lot of excitement and activity by developers as they try to get the first mover advantage. Games launch, some do well and others do poorly. People eventually master the consoles, more complex games are released, a glut of mediocre games comes along and it gets harder to find the quality games, until rumors of a new generation of consoles surface and everyone gets ready to repeat the cycle again.

Cycles in online games

We also see cycles in online games as well. At the LOGIN conference, Richard Garriott gave a keynote where he talked about the development of games. He talked about how opportunities are coming and faster. He went into how, from his experience and history, single player games dominated for about 20 years, MMOs have dominated for about 10 years, and social network games are poised to dominate for about 5 years. His message was that it’s time to move fast if you want to get on the bandwagon! I don’t necessarily agree with the details, but the general point is not unreasonable.

I also saw a few people reference the Gartner Hype Cycle. It explains how technology starts from a trigger, rise quickly to a “Peak of Inflated Expectations”, then to a “Trough of Disillusionment”, and then finally up a “Slope of Enlightment” to a “Plateau of Productivity” for worthwhile technologies. Obviously not everything fits perfectly, but it’s interesting for looking at how things work.

New hotness: Social network games

Social network games (often simply called “social games”) are the newer darlings of the online world. The lofty valuations of the largest social network game companies boggles the mind, but investors are willing to pay big to get into the “next big thing”. If you take a look at LOGIN’s schedule, you’ll see most of the talks are about social network games. One speaker at the conference even explicitly put social network games near the “Peak of Inflated Expectations”; although I’d put it on the downward side instead of the upward side. :)

So, on the panel, when it came time to look at social network games and if they were going to be enduring, I remembered what Garriott had said at the previous day’s keynote and looked at the hype cycle and knew what was going to happen. Well, that and I already had some experience with the previous iteration of this cycle.

Old and busted: MMOs

Working at an exciting startup with a great team, I’ve seen first-hand from investors that MMOs aren’t the hot thing anymore. After the big promises of EQ1′s 40% profit margins and WoW’s ability to attract millions upon millions of players, we haven’t seen any game companies able to deliver. Even thought you can still be highly profitable with a “mid-sized” MMO game, it’s still a lot for publishers to invest in, and many investors who just want to invest in the next Google fail to see how it can cause massive disruption and therefore massive returns on investment.

Those talks at LOGIN on social network games? The last few years those talks would have been about MMOs. People cheered when Near Death Studios, Inc. bought Meridian 59, and we got a fair amount of press coverage considering the small game. When it closed down, we got some restrained yet polite (and a few not-so-polite) mentions. One journalist at LOGIN for a site that only covers MMORPGs didn’t seem particularly interested in hearing about Namaste’s new project. The press cares a lot less about MMOs, particularly as a lot of Asian games have gotten translated and created a little glut in the market.

So, looking at the hype cycle, it’s obvious that MMOs are in the trough of disillusionment. So, what can we do to climb out of it?

Beyond hype and cycles: broken business practices

There are other issues at work here. A recent article by N’Gai Croal entitled “When Good Enough Isn’t Good Enough” talks about our old friend innovation. N’Gai laments the fact that only the biggest titles continue to be developed. Again we see the conservatism at work in the industry, where the perceived rewards for creating a new type of game is seen as not sufficient.

How does this relate to social network games? The biggest company, Zynga, got its start by directly copying other games of the same type. They just applied higher production values and bigger marketing budgets to come out on top. Although Zynga now seems to be hiring a lot more old-school developers to create games, one has to wonder how many relative duds they’ll see before, like the large boxed game publishers, the retreat back to cloning other games to maintain their needed levels of income.

Spoiler: yes, they’re a fad

Okay, maybe “fad” is a bit strong, but the dominance of social network games will come to an end. We can see what’s going to happen to social network games by looking at the past. It’s already happening, as a lot of the investors writing big checks to anyone who could access the Facebook API are no longer quite so excited about the medium. The cycle is simply repeating itself faster this time around. Ultimately, some aspects of social network games will inform the game industry as a whole (probably minus the social network attachments), just as some aspects of MMOs have undoubtedly influenced games, but games as we know them will continue to exist. Someday soon, we’ll see them fall out of favor as MMOs have, but then they have a chance to redeem themselves and come back better than ever. Well, at least MMOs will. Jury’s still out on social network games. ;)

What do you think? Are MMOs moribund? What can rescue them? Are social network games coming to dominate? Or do you agree we’ll see the same cycle repeating?


  1. I’m not past my 30s, but I am a student of history and people, and it seems to me that a LOT of life goes in cycles. Business and anything dealing with people perhaps especially so. (Afros were *never* a good idea, people, let them die already.)

    I think we’re seeing a glut in the DIKU MMO DNA, but MMOs on the whole have a lot of room to explore. As for “social games”, I’ve never seen them as a genre, really, but more of a showcase of new tools in a game designer’s toolbelt thanks to new technology.

    That said, the “fad wave” does seem to be compressing temporally. I’m hoping for a compression crash that reshuffles valuation of innovation and quality over riding investment waves (I have long-standing complaints with investing)… but I’m not sure I’ll see it.

    Comment by Tesh — 24 May, 2011 @ 12:14 PM

  2. Your mention of conservatism in the industry reminds me of the comment made by Cliff Bleszinski that ‘middle class’ games are dead. With the cost of game development growing at a rate that outstrips the returns the publishers don’t seem to think they can afford to try anything different any more. For example, Atari’s declaration that they are selling Cryptic and continuing their “expansion into casual online and mobile games” arguably 2 years after such games peaked indicates to me that they don’t really have any sort of plan and are just striving to be only a couple years out of touch rather than 10 years – which might be enough to fool the less shrewd investor, so fair enough.

    Obviously if this continues – and I don’t see why it wouldn’t – then funding an MMO will get even harder, and with the space quite full these days you need to be more impressive than ever to pull enough players out of WoW’s orbit. But I don’t think MMOs will die as such, because both playing games on a computing device and playing games with other people are such fundamental activities. Indeed, although the traditional MUD has pretty much died in terms of popularity (excluding niche players like Iron Realms et al), arguably the games have lived on – people still talk about ‘DIKU MMOs‘ 21 years after DIKU MUDs first emerged. So instead I expect we’ll just see a gradual dropping of the term ‘MMO’ in favour of something with newer connotations, while the games themselves continue to survive and evolve in some way. I expect to see more convergence where traditional single-player games will continue to gain more multi-player features while many MMOs work to appeal to the solo and console crowds. This mirrors the way FPSs and RPGs have somewhat converged in recent years – when you can’t innovate then you can at least cross-pollinate.

    As for social network games, I think the bubble burst last year when Facebook stopped games from spamming other users with game notifications, requests, and posts all the time. That pretty much killed off the virality aspect and it’s not likely to return because the majority of Facebook’s users hated it. Also, the generic term ‘social network’ games is itself glossing over the key point that there is really only one social network in town, and that’s not likely to change for years. With that in mind it’s hard to see how this level of interest in the area is either reasonable or sustainable: but I suspect a lot of the people involved neither use or understand Facebook or the other social networks and are poorly placed to see this.

    The future will be interesting but I doubt in 2 or 3 years time either MMOs or social network games will be top of the agenda. Perhaps we’ll have returned to a more heterogeneous view of computer gaming, which could be good for the industry.

    Comment by Ben Sizer — 24 May, 2011 @ 12:27 PM

  3. I’ve just argued on my blog that MMORPGs weren’t actually successful, because they were massive, multiplayer, or even online. They were just the biggest open-ended (in contrast to story-driven) RPGs on the market.
    I see two ways this genre will go.

    1) We will see a return to The Elder Scrolls – like RPGs. Just much bigger, because the size matters. This RPG might still be online, but the focus would not be on group content. The ‘online’ helps with “persistence”, though.

    2) We finally see a company use the MMO-part to have players passively generate content for other players.

    Until then we will see Bioware do to the story-driven RPG what past MMORPGs did to open-world RPG: Transforming them into an online game that is much bigger than any offline game ever was and adding an appendix that is called endgame. This endgame is fundamentally different from the earlier game. In World of Warcraft it is not a world anymore. And in SW:TOR it will not be a story anymore. It will just be achievements, character power progression, and easily accessable minigames.

    Comment by Nils — 24 May, 2011 @ 12:28 PM

  4. I don’t actually think that social games target the same space as MMOs.

    Games like Farmville replaced games like Minesweeper and Solitaire as games you can just about get away with playing at work in your lunch break/when the boss is out for the afternoon. They replaced staring out of the window wondering what to have for supper while on the bus home. And they may even have eaten a small amount of time while waiting for your film to download. But games like WoW and EQ were never in these spaces.

    For most players of these games they’re not hobbies as such. Ask someone what they do with their spare time and they’re very unlikely to say “I play Farmville”. That’s because the game is designed to be played in small chunks of time.

    I think MMOs are a genuine hobby in the way that golf or owning a pony are genuine hobbies – a pastime that consumes most of your leisure. I think MMOs primarily compete with Television.

    So the future for MMOs is as follows:

    - Television as an industry is fat lazy and bad. Trends happen because they’re cheap to produce not because it’s good entertainment. Decorating programs, cooking shows, reality TV. The medium is also bloated with adverts. Television will continue to decline and MMOs are one of the hobbies that will fill up the space.

    - Social games will continue to grow especially on mobile devices. There really is no point staring out of the window on your bus journey any more, but not everyone has adjusted. As the older generation dies off and younger generations age more and more middle aged and old people will be using social games to fill in boring times.

    - MMOs will explode outwards once the industry shakes off the shackles of trying to copy WoW. This will happen partly as Blizzard makes a success of a non diku MMO, partly as medium size companies follow Trion’s example of how to contest with Blizzard effectively. It’s not actually hard you just need to be joined up. Previous attempts to compete featured great zone design with bad progression design (WAR), great content with bad marketing (SOE), great class design with bad technical specifications (AoC). You can’t be bad anywhere but, as Trion is showing, if you have a solid game with no glaring weaknesses you can do very nicely. Now that people have seen Trion do it we’ll see other companies, possibly Green Monster Games, do it too.

    - VC often chases new and undiscovered markets, like MMOs were 10 years ago and social games were 2 years ago. There’s a particular feeling in finance that “getting in on the ground floor” is a good thing. MMOs will be a decent investment offering the chance of high ROI in return for high risk but will never again get the glut of money that sometimes comes if your industry is perceived as undiscovered.

    In short a sanguine future for the industry

    Comment by Stabs — 24 May, 2011 @ 4:45 PM

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