presentation

Thinking out of the game box
The new gaming business models of the internet era
Dudi Peles, Co-CEO PiSoft
Program in Science, Technology & Society
Bar Ilan University
June 2007
The new gaming business models
For over 30 years
people are making
money from games.
In the last few years
they are making it
differently.
The arcade machines
• 70s, 80s
• Dime or Quarter for a game
• Model encourages short games
Retail
• 80s, 90s and now
• $20 - $60 to buy a game in box
And then came the internet
A technology that will change the world, and
with it the world of games. And it did:
• Multiplayer online games
• Automatic games updates and upgrades
• Dynamic game worlds changing constantly
And what about the business models ?
Games are sold in the same old way
Thinking out of the game box
Is there another way for game
developers to make money
other then retail ?
Is there another way for
people to enjoy games without
buying them ?
Is there a way to do both ?
Some of the new gaming business
models of the internet era
• Subscriptions (World of Warcraft)
• Limited Environment (Runescape , Puzzle
Pirates)
• Advergaming (TrackMania Nations, Americas
army(
• Advertising / Product Placement (NeoPets,
kongregate)
• Micro-transaction / Virtual Property/ Item model
• Skill-Based Gaming / Games For Money /
Competitive Gaming
The Micro-transaction model
Give the Game for free, charge for better
looks or advantage over other players
Maple Story
GPotato
Acclaim free
MMOGS (BOTS!!,
9Dragons, 2Moons)
Sierras - Freestyle
Street Basketball
Game
Developer
Player
Kart Rider
• over 16 million
Koreans (over 30%
of the Korea's
population) having
played Kart Rider
• Nexon Kart Rider
Exceeded 300,000
Concurrent
Connectors
Kart Rider
• In Kart Rider there is no cost to get
going, but it does cost to look good
and to perform better than others
• In 2005, Nexon Corporation reported
$250 million in revenue, driven
primarily from millions of microtransactions
Skill-Based Gaming
Give the Game for free, charge for
organizing competitions
Skill-Based Gaming
• Today the biggest skill game site is
King.com with 1.3 million games
played every day (as of October 2006).
• First major web sites started their
operation in 2000: world winner & skill
jam.
Noobo.co.il
• Launched may 2007
• In the first month there
were over 1.3M
multiplayer game
sessions.
• Today there are 80,000
registered players (less
then 6 weeks from
launch)
Implications on Players
More people can play games:
• Players don’t need to pay to start playing
• Players don’t need special hardware
• Games are accessible from almost
everywhere (home, office, mobile)
People that aren't considered gamers areE
The New Gamers
Implications on Game Developers
• A lower market entry barrier from the retail
model
• Middleman function is changed
• Game piracy changes
Opportunity
Implications on the Games
• Shorter and Cheaper game sessions
(Back to Arcade Games?)
• Game-play and Game content becomes
more important (over graphics and sound)
• The Skills needed to enjoy games are
changing
Summary
• The new Gamer
collects Experiences
and not Boxes
• Games can be free,
Service will cost
Thank you for the timeE