Systems of Curse and ZAM

The World of Warcraft ecosystem saw the final “big fansite” acquisition this week, with MMO-Champion bought by Curse Inc. Big meaning something that attracts millions of users each month. Curse have been using some of their $11 million of venture capital to buy up a variety of gaming fansites, including many popular WoW sites. But MMO-Champion is significant for 3 other reasons:

  • Corporate deal, not the “founder buy-out” traditionally commonplace among gaming fansites. MMO-Champion was previously owned by Major League Gaming, already a multi-million dollar enterprise (by comparison, $46 million funding).
  • Completes a duopoly (2 dominant businesses) in the core World of Warcraft “fansite” market – Curse and ZAM. While there are other large businesses and specialist niches on the fringe, none of those appear to be growing into the core WoW market.
  • Exposes an intriguing driver of this market structure: Systems costs – the underlying technology and support costs. Intriguing because these were crucial in determining the market structure of far more traditional sectors of the economy, like groceries.

This article analyses the latest acquisitions and discusses the unseen importance of systems costs. Read More

A Strange Game

Deathwing. So it happened again. The player client software for the latest World of Warcraft expansion, Cataclysm, leaked into the public arena long before it was intended to become public. Again, because this also happened with the previous 2 expansions. A third leak is beginning to look careless.

WoW.com’s (unofficial) explanation of this “failure of secrecy” ironically fails to explain most of reasons behind the Cataclysm leak. Perhaps because the politics are rather too Machiavellian?

This article discusses the relationship between the game developer and its “fansites”. It uses the Cataclysm leaks to try and explain the underlying politics. The article questions why Non-Disclosure Agreements continue to be used, when they are worse than useless. Finally, it ponders the risks of such apparently one-sided relationships.

I’ve tried to present a fair and balanced analysis, which raises some important issues that aren’t getting discussed, and should be. Obviously, I can’t know everything. Read More

Adventures in the Invisible Tent

Here’s a tent.

Invisible Tent

It’s invisible. But it is. There. Walk forward into the space it occupies, you find yourself within the tent.

Inside Invisible Tent

The tent only exists when one is within it. When outside, we see the world without the tent.

This article explores the implication of this uncanny art form on how we build and use virtual environments. It first explains why this invisible tent is considered to be a software bug. The article explores how our ability to accept the uncanny varies from person to person. It then suggests that the spatial, built, environment is far less important than the social structures that exist within them. This topic contains a lot of images. Read More

De-Analysing Blizzard’s Starcraft 2 Marketplace

Rob Pardo Earlier in 2009, Blizzard announced a non-commercial World of Warcraft add-on policy, which caused much discussion. Today at BlizzCon, Rob Pardo (illustrated) introduced the Starcraft 2 Marketplace: A future (after the game’s launch) system that would allow independent development teams to create custom “premium maps” for the game, and make money from them. That’s precisely what World of Warcraft add-on developers cannot do. So what’s changed?

Why Create a Starcraft 2 Marketplace?

Pardo stated:

“If you create a really cool map, with all original content, that’s awesome, you can put it up onto the service [Battle.net], and actually make money on your map.”

Blizzard is prepared to share a “portion” of the revenue if you create your own Intellectual Property, and don’t simply re-use their property. Seems reasonable.

The SC2 Marketplace is intended to allow parts of the mod‘ community to evolve from amateurs to professionals. “Fan made” maps were acknowledged as an important way to keep Starcraft alive – over time, players shifted from Blizzard-made maps to fan-made maps. But maps (Pardo used Warcraft 3 as an example) still tend to use Blizzard’s game assets (such as art textures), because creating original content takes a lot of effort. And passion alone does not pay the bills. By allowing map authors to earn money from popular maps, those people would be able to fund the creation of their own, original game assets.

There’s a real sense that Blizzard lost the chance to nurture and (commercially) gain from innovations within “their game engine”. Rob Pardo again:

“The Tower Defense maps came out of the Warcraft 3 community. And now you see Tower Defense in the PlayStation store…”

Earlier in the day Stompalina tweeted about the similarity between Battle.net (Blizzard’s community platform) and Steam (Valve‘s community platform). And she’s not wrong.

Both companies are unusual. They have both escaped from the traditional publisher-funded business model that underpins most major (non-casual/Flash) game development and distribution. Valve’s Steam originally gained popularity from games like Half Life, but has now become a method of distributing games written by others – everyone from small college/”garage” projects, to mainstream titles, like Total War.

Valve is already ahead of Blizzard in constructing a social-gaming platform, even though Blizzard was there first, and should understand the media better (from developing World of Warcraft). So perhaps opening up Starcraft as a semi-commercial platform for third parties is a new strategy in that race?

Why Not Create a Marketplace in Other Games?

SC2 Marketplace Illustration Competition with the wider gaming industry does not explain why Blizzard are so unwilling to adopt a similar approach within their other games. Some of us (and I include myself) would like to do this within World of Warcraft. I have previously demonstrated that WoW has a huge pool of talent among its players, and that pool of talent is increasingly reluctant to work within WoW because it has become afraid to make money. Something which we now all seem agree is required to support major (time-consuming) projects.

It is possible to create original IP within WoW. Technically this would be more difficult within a MMOG, because players that don’t buy your content, still need to interact with those that do. But there are creative methods of working round those limitations.

One possibility is that Starcraft 2 is a new product, which is politically (within Blizzard’s decision-making process) and technically (programmed to be supported from the outset) far easier to impose a new strategy on. And we might eventually see a more relaxed approach in Azeroth.

My fear is that World of Warcraft is being treated differently because its brand is to valuable at this stage in its life-cycle.

Shrewd observers will note that Blizzard have started “doing the Star Wars thing” with the WoW brand: The revenue directly from the game gradually becomes less important than all the merchandise and franchise opportunities. Soft drinks and Trading Card Games were just the beginning…

The problem for “fan-based” projects is:

  1. Franchise and license opportunities are not available to “the little guy”. They’re not the large businesses Blizzard look for.
  2. If you sell a license it has to be worth something. So a “fan project” cannot co-exist with a franchised project that it (often inadvertently) conflicts with.

There have been several examples over the last year where conflict has arisen. Unfortunately, I’m not able to publicly discuss all of them. Suffice to say the legal threats are very real: Suddenly one finds one’s self liable for lost earnings of the franchisee and Blizzard. That’s almost certainly more money than you have – few people are prepared to risk bankruptcy.

On the Road to Damascus

If Blizzard have had a change of heart, will anyone trust them? Sadly the answer is yes. Not least because individuals tend to confuse the company with its products. And the corpses of all those fallen add-on developers decay fast.

A marketplace doesn’t fit Blizzard’s culture – somewhat secretive, protective, and controlling of its work. But Blizzard seem very similar to Apple. And Apple have managed to sustain a very successful iPhone store, full of applications created by independant developers. If both parties benefit, these uncomfortable partnerships can thrive.

Perhaps there is hope after all?

Postscript

The following day, in an interview with DirectTV, Rob Pardo was asked this question directly: Why Blizzard are endorsing commercial SC2 mods, while they have just outlawed commercial WoW mods? His reply was:

“We’re not making money from the people that are doing third party things for WoW. It’s not really allowed to go out and make stuff around WoW without licensing it from us. It’s really us just protecting our Intellectual Property.”

Favorite Fishing Places

This article analyses the favourite fishing locations of World of Warcraft anglers. Both where and why.

The most popular single zone is the Grizzly Hills, with Azshara’s Bay of Storms and Wintergrasp in joint second place. Reasons are split into artistic (music, scenery), emotional (relaxation, memories), practical (fish caught, convenience), and social (companions, player interaction) themes. Overall, each theme has similar importance. The article discusses the apparent contardiction between desires for solitude, and to be surrounded by life.

This is the second of several topics that explore the reasons people fish in a virtual world, ultimately drawing parallels with fishing in the physical world. Read More

Where We Fish

This article analyses where players fish in the game World of Warcraft. It reveals the role of daily quests in shaping our fishing habits, demonstrates just how popular city-fishing is, and starts to reveal why we fish. This is (hopefully) the first in a series of articles that collectively examine why people fish in this massively multiplayer online game.

Daily successful casts by area. The map shows number of successful fishing casts (diameter of each circle), by area. Numbers are daily totals for all United States and European realms combined, based on a sample in July 2009. Click the map for a larger view.

A successful cast is one that does not catch a junk item, which might occur if the anglers’ skill is to low. There are 14 million successful casts each day, catching 16 million fish: Some casts catch more than 1 fish. In addition, there are 4.5 million unsuccessful casts (that catch a junk item). Unsuccessful casts are not shown on the map.

“Old Azeroth” refers to the continents of Kalimdor and the Eastern Kingdoms (the pre-expansion game). Within Northrend (the main area shown on the map), casts into coastal waters are shown separately from “inland” casts in other zones.

In each area, the total number of casts is divided into 3 parts:

  1. Open Water (dark blue) – Casts into bodies of open water.
  2. Daily-Related (gold) – Casts while trying to complete a daily fishing quest. This includes all casts while trying to complete the quest, not just those that catch a quest fish.
  3. Pools (light blue) – Casts into schools of fish.

Northrend is the continent hosting the current game expansion, Wrath of the Lich King. The continent is home to higher-level (more veteran) players. Expect to find most fishing activity here – and we do: There are 9.3 million daily casts in Northrend – two thirds of all successful casts.

A sixth of all casts are related to the daily quests, in spite of the fact that there is just one such quest available each day (the area varies between realms, randomly each day). The Northrend fishing quests are the most popular quests in the game – completed by over 300,000 characters each day. No, really – at least before patch 3.2 was launched, which made Heroic dungeons popular again. Anglers’ might be motivated by the additional reward. Or this might suggest a far greater need to guide players. Either way, it raises some questions, such as, why is there just one fishing quest per day in the current game expansion?

Ignoring daily quest-related fishing, the most popular single location is Dalaran’s Eventide Fountain, with 1.4 million casts per day – equivalent to 1 person on each realm fishing there for 12 hours each day. The irony is that Dalaran’s Eventide Fountain is also one of the smallest body of water in the entire game. Cities account for a third of all casts – Dalaran is not the only popular city. At least half of the “Old Azeroth (Inland)” casts are casts in the waters of major cities (such as Stormwind or Orgrimmar).

So, half of all fishing activity is either directed by quests, or occurs in cities. Training (cooking and/or fishing skills) is also an important reason to fish, although it is harder to estimate how important.

Pool fishing is normally the fastest way to catch “valuable” fish. Yet only 17% of casts are from pools. Even if we look at areas with no quests and desirable “Northrend” fish, like the Grizzly Hills, half of all casts are still in open water. This isn’t the only example that suggests that anglers really are quite lazy, and don’t want to much hassle when fishing.

The remainder of this article explores some of these issues in more detail, using information about where we fish to start to explain why we fish. It also describes the method behind the numbers, with a technical appendix containing data. Read More

De-Analysing Blizzard’s Add-On Policy

Blizzard Entertainment’s new add-on policy has been discussed by everyone from Lum to Slashdot. The number of developers directly affected by the change is small, since only a few add-ons are popular enough to be considered commercial ventures. The policy is more significant because it changes a lot of established conventions, and goes to the heart of how Blizzard embraces (or increasingly, shuns) the talent within its player community. This article is an attempt to analyse the real motivations behind the policy, and highlight the apparent contradiction in policy between in-game add-ons and web-based services. Read More

Exploration is Dead. Long Live Exploration!

Dalaran. Hard to miss, it seems.

Something happened at the start of July 2008 that only happens once every 2 years. For a brief period, everything about the world was not public knowledge. A handful of people worked day and night to fill this chasm of information. To document everything that was suddenly new and uncertain. Meanwhile the world filled up with hardened veterans, many of whom seem to struggle with, well, everything:

“How do I get to Northrend?” – Well, perhaps that new harbour or zeppelin tower that’s been built might give you a clue?

“Where’s Dalaran?” – Did you try riding to the end of the road and then looking up to see what’s blocking out the sun? (Dalaran is pictured right.)

The world is, of course, the World of Warcraft. And the 2-yearly occasion is the start of public testing of the latest expansion, Wrath of the Lich King: The only time a significant proportion of the game world changes.

What’s alarming is that these questions are not from new, inexperienced players. These are from people that have already played the existing game for months or years. They clearly want to know, but seem to have lost the basic ability to explore the game world themselves.

This article explores the concept of “exploration”, and tries to explain how one of the most complex virtual worlds ever created has become popular among players that are not natural explorers. Read More

Frostmourne Cavern

This movie records one of the many lore-related events in World of Warcraft’s upcoming expansion, Wrath of the Lich King. It’s a vision of Arthas and Muradin Bronzebeard discovering the sword, and in doing so, changing the “world” forever. The event is part of a single-player quest in Northrend, the expansion’s new continent. Previously events like this were found at the end of dungeons so hard that most players never saw them.

The aim of the game is changing. Previously the aim for a lot of players was to get to “the end”: To obtain the highest possible level, at which point they could embark on challenging group dungeons or player-vs-player battles. But Northrend is full of reasons to play the game in the middle. Not just this. There is a lot of high quality, fun, even inventive content coming with the new expansion. From aircraft combat and mass-slaughter shoot-em ups, to peace, love and harmony: Saving baby murlocs is enough to bring a tear to the eye, which is quite an achievement for any game.

Pro-Auctioneering, the New eSport

Electronic Sport (eSport) is the competitive play of video games, often professionally, for prize money. In South Korea contests are so popular they are broadcast on dedicated television channels. E-sports generate less enthusiasm in the rest of the world, but their popularity seems to be growing.

There are parallels to traditional physical sports: The games played are accessible to the general public, but require huge dedication, skill, training and coordination to be “the best”. Many football (soccer) fans enjoy “kicking a ball about” in the street, but don’t expect to be playing at Old Trafford. Likewise there is a huge difference between beating Quake‘s single player mode and competing against top players. Probably the biggest difference is that eSports focus on the screen (what the player is doing), rather than on the player themselves (as tends to be the case with physical sports). This, combined with the traditional “geekiness” of video games, helps explain why most eSports professionals are rather devoid of charisma. Not that that stops tournament organisers putting these people on stage…

Traditionally eSports have favoured fast-paced games, either played individually or as small teams. Contests take place in short bouts. Examples include Starcraft and Counter-Strike. While these games require a degree of strategy, exceptional hand-eye coordination and reflexes are key to winning.

There have been attempts to promote casual games eSport, but tournaments remain biased towards fast-paced games. In the case of World of Warcraft’s (WoW) arena tournament, the core of the original game (the massively multiplayer part, where players are expected to invest time developing characters) was systematically removed to create a platform for traditional eSports. Missed opportunity. And here’s why:

This article proposes a rather curious “eSport”. One that is entirely dependant on the core facet of Massively Multiplayer Online Games (MMOGs) – the other players. An E-Sport that is played over days, rather than minutes. A game within a game, that tests abilities beyond simply clicking the mouse faster than your opponent. Allow me to introduce, Pro-Auctioneering. Read More

Peeking Into Blizzard’s Development Process

Initial concept plan for Lake Wintergrasp. Basic... Blizzard Entertainment have a reputation for being “tight lipped”, and not announcing details about the games they develop. And since Blizzard have a lot more freedom than the developers that are closely regulated by their publishers, they should be able to talk openly.

But having listened to many of their senior developers talk during the recent Paris “WorldWide Invitational“, I suspect actually, they just don’t know yet.

Increasingly publisher-driven games tend to be heavily pre-produced, then implemented by programmers who work for hire: The details are known a long time before release, and the only reason not to talk about them is competitive. But if you don’t have such a precise battle-plan, you can’t release information with any real certainty. So you either get a reputation for saying little, or get a reputation for producing games that ultimately exclude many “expected” features.

Blizzard are one of the most successful game developers, so they must be doing something right. It is interesting to try and understand how they develop games. Read More

Map of World of Warcraft Online Communities

Michael Zenke’s MMO Blogipelago map [via Tobold], based on the famous xkcd map of online communities, inspired me to create a map for World of Warcraft (WoW) online communities:

Map of World of Warcraft Online Communities.

Glider MMOwned Emupedia MaNGOS Project Baron Soosdon Olibith Oxhorn WoWJutsu Highlander's Profession Leveling Guides Cash Creating Guide (Advert) Zygor Guides (Advert) Brian Kopp (Advert) Team iDemise (Advert) Wowhead Thottbot Allakhazam Nihilum World of Raids MMO-Champion Roguespot Warlock's Den WoW Trading Card Game Elitist Jerks El's Extreme Anglin' WarcraftPets.com Petopia WoW Insider WoWWiki WoW Radio WoWAce Inc Gamers Curse Ten Ton Hammer Stratics Warcry Gamespot IGN GameSpy BlizzPlanet
Map of World of Warcraft Online Communities.

The article below explains the logic behind the map. Read More

Platform Azeroth: Why Information is Broken

This article explores why the best information in World of Warcraft (WoW) is not available from within the game. It considers how to better bring information into the game environment.

Analyse this:

Screenshot of WoW in-game browser hack.

Above is a World of Warcraft screenshot, showing an in-game browser. This is not a feature of the game. The “Knowledge Base” is technically a support database written exclusively by the game’s developer and operator, Blizzard. However, an enterprising hacked called Vladinator noticed that this in-game database took its information from a specific webserver. The Knowledge Base could therefore be re-directed to a different webserver: In this case a server that shows information from Wowhead, a third-party site that contains reference material on almost every item, quest, and thing in the game.

Blizzard was quick to block the hack.

This article attempts to explain the utterly illogical structure behind these events. It builds on some of my earlier comments about the use of micro-transactions for in-game education (“Learn2Play”). Read More

BarCamp: Living on Virtual Fish

For those that missed my BarCamp Scotland presentation, “Living on Virtual Fish”, you can view it on SlideShare.

The following articles loosely correlate to each of the talk’s sections, and provide more depth and explanation:

  1. Learn2Play, the new Real Money Trading?
  2. Adventures in Online Advertising
  3. Thoughts on a Socio-Economic Environment based on Nothing

El’s Extreme Anglin’ – 2007 Retrospective – Part II

This article continues my observations on running El’s Extreme Anglin’, a World of Warcraft (WoW) fishing guide, with a look at some of the trends in usage during 2007. You may also be interested in part I of the 2007 retrospective, which contained some observations on aspects such as thought leadership, quality and links.

Read More

El’s Extreme Anglin’ – 2007 Retrospective – Part I

El, a gnome fisher-woman. El’s Extreme Anglin’ is a guide to fishing in the game World of Warcraft. This article contains some of my observations from running El’s Extreme Anglin’ during 2007. Further analysis of trends, and commentary on the introduction of advertising to El’s Extreme Anglin’ are contained in follow-up articles.

Virtual Fishing

Fishing games have been around for a long time. Fish Tycoon is one of the top selling “casual” games. The popularity of fishing in the first major modern MMOG (Massively Multiplayer Online Game), Ultima Online, even took designer Richard Garriott by surprise [1].

Unlike most fishing games, fishing is a relatively minor part of the world’s most popular current conventional MMOG, World of Warcraft (WoW). It is not fundamental to the game’s design: Players can play the game without knowing how to fish. Like much of WoW, the basics of fishing are exceptionally easy to master, yet fishing becomes exceptionally complex, the further players get into it.

El’s Extreme Anglin’

El’s Extreme Anglin’ was launched in August 2006, as a guide to fishing in WoW. It was initially written to fill knowledge gaps in that complexity: Nobody had previously explored issues such as what skill is required to cast in different areas, or how pools of fish appear, or the extent to which catch rates varied by time of day.

The guide has always tried to cater to a wide audience – from the beginner to the expert. Both are important in developing such a guide: The beginner material is primarily what gets read. But, the expert material is crucial, even if it is rarely read:

  • It gives the beginner confidence that the material they are reading is reliable, because the author has clearly explored the topic in far more depth than the beginner needs to know.
  • It impresses the “thought leaders” in the community.

Why are thought leaders so important? They are the key to viral marketing: Allow me to explain…

Thought Leaders and Virality

El’s Extreme Anglin’ was never actively marketed. I posted a couple of links to it in forums, and made it as accessible as possible to search engines. Yet within a year it was attracting over 60,000 individual people each month, and had attained the top spot in Google searches for key terms like “WoW fishing” (beating over 250,000 other sources [2]). Where did all that traffic and search-engine karma come from?

Thought leaders: A very small group of influential people within communities, who other players instinctively respect for their knowledge. Perhaps a hybrid “connector-maven”, to use Malcolm Gladwell’s Tipping Point terminology: They don’t just know; they are able to communicate what they know down to the masses. WoW examples include the forum gurus (like EU’s Highlander), the bloggers and virtual world aficionados (like Alice Taylor and Tobold), and webmasters of community sites (people like Thott and Teza). These are people who generally know everything already published, recognise that what you’re publishing is better, and rapidly link to, recommend, or generally promote your material.

Thought leaders themselves won’t generate much traffic, but the people they influence will in turn influence others. From them, the recommendations spiral out and down the pyramid. The further down the pyramid you go, the more the recommendations are likely to be personal, and highly “viral”: For example, one-to-one using in-game chat channels, or posted on small guild forums. Those are far less tangible, but ultimately create the bulk of traffic, not the links from the flagship sites (the value of links from larger sites is explored below).

The realisation that so much influence is in the hands of so few should not come as a surprise. However, the value of certain people in filtering information for the rest of us is still hugely underestimated on the internet, even if the principal underpins the success of search engines like Google [3].

Quality

Quality matters because it is crucial to the decisions of thought leaders. They will only recommend the best they know – their reputation depends on it. But does it matter to the average reader? My basic philosophy when writing is to do something different or better. I certainly can’t do it cheaper, since it is already free to the end user, and I’m not yet able to convince myself I can sell a guide to fishing, even though some WoW guides do sell commercially. I wrote about fishing in depth because at the time, nobody else had. And ever since, I’ve tried to keep the guide as definitive as possible.

It works. Players do actually trust what I write. I wrote a response to Blizzard’s Black Temple Attunement April Fools joke: Detailed instructions on how to catch Djakar, which included references to two +75 skill fishing poles, both entirely fictional. For months afterwards, people would refer to these poles in forum posts, like they were “real”. Along with trust comes responsibility…

I could have written a dozen mediocre texts about WoW fishing in the time it took to write El’s book. I opted for quality, while trying to accommodate the differing levels of experience of readers by offering a mix of articles. This is where it becomes hard to resolve the contradiction (in my mind, at least) between thought leadership, the long tail, and the cult of the amateur [4]. Perhaps I’ll return to that one in a future article…

There is a misconception that being linked to from one of the flagship WoW community sites like WoW Insider or MMO Champion causes a “slashdot effect” – a dramatic increase in traffic the day the link is posted.

It doesn’t.

At the end of October I wrote a detailed article about fishing changes in patch 2.3. I tagged a link onto the bottom of a forum thread at World of Raids, made it to their front page the next day, and then bounced round most of the WoW community news sites (and a few podcasts and blogs) over the next week [5]. The total number of visitors spiked at 10,000 per day on two occasions, which was only just over double the prevailing traffic at the time.

Articles like that on patch 2.3 are of fleeting interest, and within a month hardly anyone was reading about it. They don’t create many additional page views. But they are excellent “loss leaders”: People will follow the link it, mentally log the fact that they’ve found a website about fishing, and a few weeks later when they actually want some information about fishing, they’ll come back and read other parts of the site.

Continue reading part II of El’s Extreme Anglin’ 2007 Retrospective

Notes

  1. The Tabula Rasa website used to contain the following quote by Richard Garriott: “I was struck in the early Ultima Online days by how many people were engaged in the profession of fishing, despite the fact that the simulation was a mere 50/50 dice roll with each use of the fishing pole.”
  2. Although most of these transpire to be either a re-hash of Highlander’s Cooking and Fishing levelling guide, a doorway for a gold seller, an affiliate link farm, or all of the above.
  3. Google’s pioneering search technology, Page Rank, effectively ranks content based on how widely it is linked to on the internet. Before Search Engine Optimisation became mainstream, links between web pages were generally a measure of how much real people rated the content on the linked site. Today the approach fails outside of mainstream popular culture, because links can be purchased or spammed (popular culture is immune only because the cost of spamming your way to the top becomes prohibitive). If the actual person placing the link could be traced, and their level of knowledge of the subject assessed, we would recreate the matrix created by thought leadership automatically. Currently, only us humans can make that judgement, and probably only the more discerning of us: Do we trust the author of the link as an expert in this field or not? I find myself disagreeing with Larry Page, when he said that, “The ultimate search engine would understand everything in the world.” The ultimate search engine does not need to understand anything. It merely needs to know who to trust.
  4. What contradiction?
    • Thought leadership demands quality…
    • Yet the long tail tells us that the more choice we offer, the more we will “sell” overall…
    • While the cult of the amateur implies that the lowest common denominator will eclipse everything else.
  5. Competition for “news” between WoW websites is intense. Many increasingly appear so desperate for content (my opinion) that they will post almost anything even remotely newsworthy. And the moment one site has covered it, the others follow.

Appendix: Timeline

  • January 2007: Launch of The Burning Crusade expansion, including plenty of new fish. Over the next three months, traffic almost doubles, as players reach 70 and start fishing: Not least for the famous, but hard to catch, Mr. Pinchy. I had painstaking documented how to catch Pinchy a few months before during beta testing.
  • April 2007: Fish Finder added to El’s Extreme Anglin’ – a database of fish. Information is presented differently to other WoW databases. The Fish Finder grew in popularity over the year to become the most popular section of the site by December.
  • May 2007: Blizzard comes under pressure to make +30 stamina buff easier to find, but pulls back from introducing a vendor-based alternative to cooked Furious Crawdad in patch 2.1. The process of fishing became faster, and Highland Mixed Schools were subtly tweaked to improve yield.
  • June 2007: El’s Extreme Anglin’ runs its first reader poll: Did patch 2.1’s changes made fishing more enjoyable? A resounding yes!
  • July 2007: Advertising appears on El’s Extreme Anglin’ for the first time, all affiliate-based.
  • November 2007: Patch 2.3 adds a few extra fish and a pool-tracking ability, and accidentally forces cooks to use fish (rather than meat) to level above skill 275. Interest in fishing increases to an all-time high. However, daily cooking quests gradually start to erode the value of many valuable fish at the auction house.
  • End of 2007 (31 December/1 January): El’s Extreme Anglin’ moves to a new dedicated domain, elsanglin.com.

Learn2Play, the new Real Money Trading?

Extract from advert for Luke's Gold Making Guide. Real Money Trade (RMT) is the buying and selling of virtual property or currency for real-world money. Many virtual worlds now embrace this trade in virtual currency and goods, often as a source of income for the world’s operator. Blizzard, the developer of World of Warcraft (WoW), does not:

“RMT is a TOS [Terms of Service] violation. The fanbase is pretty committed to being against it, and we’ve got a group of guys that are committed to stopping TOS violations. The game was never designed for that in mind – everyone starts off even. In the real world that’s not true, but in WoW everyone starts even, and the RMT stuff messes with that.”

Not just rhetoric. They have sued a leading supplier to prevent them advertising in-game. And they regularly ban large numbers of accounts used to “farm” gold.

That environment seems to have expanded another quite logical commercial market: Teaching players to play. “Learn2Play” in the vernacular, or “L2P” in shorthand.

Rather than buying gold (in-game currency), players buy the knowledge of how to make gold themselves. The market isn’t restricted to gold. Guides to power-leveling (advancing a character through the first part of the game as fast as possible) are also popular: Rather than pay someone else to level a player’s character, players can buy a guide containing instructions optimised for rapid leveling.

This article explains Learn2Play, and explores some of the history and trends in this “market”. It focuses specifically on World of Warcraft, in English, which is sufficiently popular to create a tangible commercial Learn2Play market. It draws on my own experience from selling these guides.

Superficial analysis suggests the World of Warcraft Learn2Play market is valued at over $3 million revenue per year. In spite of WoW being an online experience, revenue from physical book sales may still exceed revenue from the virtual equivalent. The market is far smaller than RMT. But the notion that people are willingly investing US dollars in knowledge and skills that are useful solely within one virtual environment, should perhaps deserve as much attention as other real-virtual money transactions.

Read More

Patrick Chung on Games Venture Capital

These are rough notes from an Edinburgh Entrepreneurship Club/Edinburgh-Stanford Link lunch event. Patrick Chung is a partner with NEA (New Enterprise Associates), focused on internet technology, including video games.

Video games trends

A summary of his current trends in video games:

  • PC.
  • Casual. Fishing is really popular, apparently. (I know!)
  • Platform. The development of platforms, instead of specific game titles, spreads the risk. Mainstream games titles are expensive to develop, take a long time to build, but often don’t sell well – ergo, as high a risk as almost anything. Parallels my earlier musings on games industry innovation.
  • Virtual goods and alternative revenue models.

Nothing terribly unexpected there. But he made some interesting points on venture capital and funding.

When to consider venture capital

At the outset of a venture, consider venture capital only when you really need it. He used the example of Loopt. The two young founders needed the approval of major US mobile carrier networks. They simply would not have got in “through the door” of those organisations without the backing of a major venture capitalist.

In most cases, find angel investors (individuals with private money to invest) to get started. Specifically angel investors that don’t make too many demands. Those demands both go against the spirit of angel investing (the woman in the pub writing a cash cheque on the back of a good idea and little else), and can make it far harder to progress once the enterprise grows (i.e. selling part of it to venture capitalists).

The valuation of a “typical” Silicon Valley consumer internet enterprise will change over its development:

  • Start – an idea, no real plan, people without previous experience: ~$2 million.
  • Experience – a plan, a capable team, perhaps some rudimentary code: ~$4 million.
  • Product – tangible product, not yet launched or perfected: ~$6 million.
  • Users – people are actually using your product: ~$10 million.

If users are growing rapidly, valuations can also grow rapidly.

Why are these changing valuations important? An enterprise still at the first (starting) stage, will probably need to sell half the business to a venture capitalist in return for funding. The further one is down the valuation chain, the more bargaining power an entrepreneur will have. The advice is simple: Don’t sell right at the start unless you really need to.

Location and culture

Geographical location is particularly important for early-stage enterprises, or when the people involved have little experience: The venture capitalist will want/need to be involved day-to-day, almost hour-to-hour. That’s a problem if there is a 9-hour time difference: A crisis in London at 10:00 is likely to stop someone in Silicon Valley getting a good night’s sleep. (Games are somewhat easier, because developers tend to work very long hours…)

Later-stage enterprises can be managed more effectively from the other side of the world. Realtime Worlds (Dundee, Scotland based) is a good example. The business was already established with 100+ employees, including some of the people involved in the original creation of franchises like Grand Theft Auto.

Culture is also important: All venture capitalists are not the same. For example, some will invest based on the people involved in an enterprise. Others will look more at the idea.

Funding application stages – what’s expected

Patrick highlighted a series of stages in the pitching/evaluation process:

  1. You – what are you trying to do, how, how dedicated are you to that aim? They look for problems to be solved – “painkillers, not vitamins”.
  2. Market and returns.
  3. Uniqueness of solution.
  4. Competition and team.
  5. How much money is required, and how will it be spent? Avoid running out of money: Ask for more than you think you need – perhaps twice as much. If you run out of money before completing an initial product, you won’t have any bargaining power when trying to raise more.

Video Games Industry Innovation – Edinburgh Digital Interactive Symposium

This is the second set of notes from the first Edinburgh Digital Interactive Symposium, which was held on 15 August 2007. You may also be interested in the session on Virtual Policy and Law.

These notes discuss innovation within the video games industry. The factual information is primarily drawn from sessions (and conversations) with Jessica Mulligan (executive producer and one of “the five most important people in the virtual world“), Jason Rutter (University of Manchester), and Brian Baglow (Indoctrimat). These notes are my personal interpretation of what was discussed, not a transcript of the event.

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Virtual Policy and Law – Edinburgh Digital Interactive Symposium

The first Edinburgh Digital Interactive Symposium was held on 15 August 2007. It aimed to bring together academics and the “games” industry, to discuss topics from games industry innovation to policy in virtual worlds. The diversity of people these topics attracted was remarkable – from philosophers to corporate executives. It should come as no surprise that we all struggled to understand each other. Yet this was a group who merely by expressing their interest in such an event, tend towards curiosity.

This is the first set of notes from the Edinburgh Digital Interactive Symposium, covering virtual policy and legal issues. A second set of notes discusses innovation in the video games industry. These notes are my personal interpretation of what was discussed, not a transcript of the event.

Law

The lawyers are very excited about virtual worlds. Antonis Patrikios, from Field Fisher Waterhouse LLP, was speaking. At the most basic level, it’s a clean slate with no case law, yet almost endless contentious issues. You can almost see the dollar signs in their eyes. At one extreme there is a school of thought that wants to declare a new thread of international law – that is, to treat virtual environments as separate legal jurisdictions. At the other, the simple statement that real world objectives (and therefore regulation and law) will be directly applied to virtual worlds, without special consideration.

An example of one of the many crunch-points: If by “playing” I generate money-tokens (i.e., not necessarily legal currency, but having the same effect within the world they are generated), and someone does something that scams me of those money-tokens, do I have any rights in (physical) criminal law? If prior to bankruptcy, I move all my assets into a virtual currency, can the authorities recover them? One position is that I only have rights if the operators of the virtual environment allow me to legitimately transfer my money-tokens into real money. But it could be argued that if something is perceived as having value, it has value, even if it can’t be directly or legally (contractual law) monetarized.

Now, add to the equation the fact that the representation of the person within the virtual environment may not be traceable to a real legal entity. (There’s a major philosophical argument here too, that I’ll step over because I don’t understand it – although I’m told the fact I don’t understand it is fundamental to my ability to try – er, yes.) The one entity that always is traceable is the operator of the world – who of course have no legal structure themselves, since they are typically a business and not a civil authority. The anonymity issues may be solved technologically, but the very possibility that operators might get dragged into criminal cases triggered by what their users do, is pretty frightening.

The role of physical location of operators, technology (servers), and users gets even more complex than in the (already arguably broken) website/e-commerce model. Does intellectual property of things created in these worlds transfer to the user? Trademarks are defined territorially, yet where is this virtual territory? And is a virtual re-creation the same as a real product anyway? There are big US/EU differences here. For example, in the EU it is far harder to patent the implementation of an idea, rather than the idea itself. So a lot of software patents that exist in the US, don’t exist in the EU, since software is commonly just the technical implementation of an idea.

There’s an interesting aside here on when money becomes a currency, and when a game becomes a bank. In the UK, if you offer credit, you’ll drift into financial regulation. The question nobody can answer is when that provision gets so large it becomes a bank, or so popular it threatens an existing currency.

Policy

Chris Francis (IBM) attempted a basic differentiation between virtual games/worlds. He takes more of a policy perspective than others. You have to be able to quantify each virtual experience on a spectrum, otherwise everything from simple online games to open real-currency trading platforms will be seen as the same thing in any regulatory debate. There are four factors, each of which covers a spectrum of topics. Generally the further to the left you are, the more like a game (and hence the most likely to avoid regulation), the further to the right, the more like real life (and so the more likely to be regulated):

Economy/tradability: In-game “gold” <<—>> Real money.
Identity/communication: Text <<–> Voice <–>> Accountability.
Plot: Scripted <<—>> Freeform.
Data flow: Augmented virtuality <<—>> Augmented reality.

Augmented virtuality I didn’t quite understand as a concept, but I’d interpret it as the re-creation of augmented reality concepts into an inherently virtual setting, rather than a real-world one. The interesting current topic is voice. Voice is a significant shift into the realm of communications legislation, since voice is widely understood to be communication, while text is a grey area. It follows that in introducing voice clients within games, game operators are more likely to open themselves up to regulation. I don’t think the games industry had considered that.

William Garrood spoke from Ofcom, the UK communications regulator. In the EU, active regulation is currently focused on television-like services, particularly using the radio spectrum for transmission. Electronic Communication Services legislation first appeared in 1998, passed into EU law in 2000, and has slowly been added to law across EU states. (It is worth noting that the regulatory cycle is almost 10 years, the academic cycle for studying it all is 3 years, yet 6 months is a typical industry timescale to deploying new technology in the arena.) The current legislation could allow virtual worlds to be regulated, at least in part – but nobody is yet. This was intentional in the design of the legislation: The EU agenda is to move away from regulation – there is a desire to try and foster self-regulation.

The EU may be regarded as a lower-risk environment than the US, simply because the US has no apparent boundaries – yet a litigious culture that will make discovering those boundaries expensive, and arguably will resolve them in favour of the dominant industry. The EU has a structure that is likely to “step in” if it looks like everything is going to hell in a handcart.

Ofcom is quite focused on the BBC‘s traditional territory: Supporting “socially valuable content” in virtual environments. They already have a strategy called the Public Service Publisher. They’re aware that young audiences, in particular, are moving away from television, and are looking to fill the “post-TV gap”. It’s positive regulation, although how it works in practice is unseen.