A Non-Gamer's Take on Gaming
Hi everyone, welcome to your monthly edition of alohomora! I hope you are all staying safe.
In the first two newsletters, we’ve gone deep on a few specific parts of the media landscape, mostly focused on newsletters and content consumption. I wrote an article in VentureBeat on the explosion of digital and the need for analog (like a trusty Moleskine) to manage information, and want to stick to analyzing the media landscape for the next few editions of alohomora. Like a16z’s Chris Dixon, I think “the next big thing will start out looking like a toy.” This idea is a key part of Clay Christensen’s disruptive technology theory, and it has been re-worked and analyzed by many, including Dixon (see his 2010 article on the topic). The theory hinges on the observation that new technologies improve at a faster rate than user needs advance, allowing technologies that may have at first appeared trivial, rapidly become dominant.
I have not played a video game since playing the Sims 2 about fifteen years ago. I loved the Sims because it felt like a life proxy - the life my Sim lived was the life I wanted. I made her look like me, had her own a cute dog, and her preferences aligned with my real tastes. The Sims moved at a quick pace such that I was always incentivized to go back in and continue living the addictive life I’d created virtually. The game had a way of drawing me in, even without being social or connecting my experience to the world beyond the screen as games do today.
The Nintendo DS was my portal into the Sims world, and eventually, as I stopped playing games, it grew dusty under my bed. Despite losing interest in video games, I have found the gaming space to be highly dynamic today, and believe developments in gaming will inform future developments in human interaction and content creation. Today’s newsletter will explore a new part of the media landscape: the trailblazing technologies in today’s gaming renaissance. Gaming is a huge industry, and generated over $120 billion in 2019 (Venture Beat). It is becoming less “life proxy,” and more “reality” with each passing day.
Hardware, game engines, and software applications are combining to drive new economic and social paradigms. My now outdated, handheld Nintendo is no longer the dominant hardware for gaming. Today’s casual gamer has moved from the purpose-built, clunky systems of 10+ years ago to sophisticated, primarily mobile, displays. Mobile is the segment of hardware driving the most growth in gaming. Dominant platforms for today’s gaming hardware are listed below, along with a quick summary of each, and key developers.
Lightweight Devices: Mobile devices and tablets - Apple
Gaming Laptop: Best for portability - Lenovo
Gaming PC: Typically powerful and customizable - Alienware, Razer
Consoles: Include specific titles, generally straightforward setup - Xbox, Playstation, Nintendo
Head Mounted Display (HMD) and glasses: Displays integrated into glasses / hardware - Oculus, Valve
Gaming hardware is expensive, and this hardware will dictate where the future of the industry steers. With mobile phones in everyone’s pockets, games on lightweight devices promise ubiquity and virality, whereas PCs, consoles, and specialized devices optimize for quality and frequent gameplay. Widespread ownership of mobile devices enables near-constant engagement and analytics, which forms the foundation of the metaverse and data economy.
We will not explore anything related to the vast number of games actually out there today, but will touch on another component of gaming - the infrastructure games are built upon. Specifically game development engines like Unity and Unreal. Unity (released in 2005 by Unity Technologies) and Unreal (released in 1998 by Epic Games), are the dominant game development platforms, and you can find a comparison of the two here (and many other places if interested). In short, these two companies dominate the game development market, while companies like Cryengine, simulation-focused companies like Improbable and Hadean, and open source Godot occupy a much smaller slice of the market. In the future, one could envision pairing text generation engines like OpenAI’s GPT-3 with tools like Opus AI that turn text into imagery and video, to generate worlds and develop games in real time.
Gaming has leveled up and is driving us towards the next phase of our ultra-connected society - the metaverse. The metaverse is a shared, virtual space that’s persistently online and active, and has its own economy and activities. The difference between playing the Sims so many years ago and gaming now, is that gaming has come to focus heavily on social. Online and real lives are converging. Our virtual lives will give off data with every interaction, and are ripe for optimization, which will unlock the next-generation economy, the data economy. Online life is now complete with social pressures, economies, and live events that impact real life. For example, Fortnite hosted a virtual Travis Scott concert, and virtual concert startup WaveXR hosted a John Legend concert with Legend performing as an avatar. Virtual economies exist within games and on platforms, allowing users to earn real-world money, and also use real-world money to purchase virtual assets.
At their core, successful games have to be entertaining enough to cut through the noise, and often appear toy-like to attract their initial audiences. They allow users to pause the stresses of daily life and live fun, proxy lives where they have riches, friends and social commitments to keep - but now all of these things are actually tied to their real lives. Gaming communities are the foundation of future social and economic interaction. They are able to form quickly due to the power of game engines, ubiquity of hardware devices for gameplay, and the convergence of real-life and virtual social incentives.
Further Reading
VentureBeat, Games Hit $120.1 Billion in 2019
Maxime Eyraud is a key researcher in this space. His 2019 Media & Entertainment Tech Review is incredibly comprehensive.
The Information: The Escalating War Between Our Physical and Digital Realities
Thanks to David Bloom and Ash Richter for the early feedback on this essay, and to Spencer DeShon for editing every alohomora edition.