New York Games Conference Roundup

I attended today’s New York Games Conference in Manhattan. As usual, Digital Media Wire did an excellent job of assembling a diverse, useful program; if you get the opportunity to attend one of their events I recommend it.

I’m going to run down some of the panels I attended as succinctly as possible. Some, but not all, of this applies directly to transmedia storytelling.

Analysts on Gaming Trends

The first panel of the day featured analysts Michael Klotz, Michael Cai, and Michael Pachter running down business trends in the gaming field. Setting the precedent for the rest of the day, there was a heavy focus on mobile and social gaming. I was mildly surprised that none of the three mentioned brand extension or the transmedia endeavors that game publishers are embarking on. Here’s what each analyst said:

Michael Klotz, NPD

• Headlines are akin to 2006, but with a twist. While retail sales are down, the industry has transformed.
• More devices, and many different ways to play, download, and pay.
• Only 12% of people over 13 downloaded a free mobile app last year.
• Console gamers are playing on other platforms, but a lot of new gamers are starting on social networks and mobile platforms.
• Around a third of social gamers only play social games. Anecdotally, people are migrating to other platforms from social.
• NPD is beginning to track transactions executed with reward points, virtual currencies etc.
• Traditionally, 40% of revenue comes from the 4th Quarter, so NPD expects growth.
• If cloud gaming is the future, not sure when it will happen – if infrastructure goes down, could cause big problems (like PSN)

Michael Cai

• Free-to-play model has become legitimate over last 3-4 years
• Facebook opened the floodgates
• Have seen an emergence of “Anti-Zynga” Facebook game companies – Kabam ($110m new investment), Supercell ($12m, one game), Kizeye ($24m)
• First person shooters emerging too
• Zynga coming out with Adventure World – slightly more core leaning. EA also bringing core franchises to Facebook.
• But Cityville, Sims Social, Empires and Allies still dominating
• iPads are a big catalyst for growth. Lots of young kids are growing up with iPads and its touch mechanics (will they stick with tablets over traditional gaming machines?)

Michael Pachter

• We’re about to see an explosion of monetization, brought about through the integration of mobile and social gaming.
• Established brands are looking to expand into social gaming. The Sims is an example of a huge brand doing well in social. The Facebook platform allows EA to expand awareness for the brand and upsell those social players to more expensive games.
• Everybody’s goal is to engage players, keep them engaged, and monetize.
• Brands have great power to attract gamers. Pachter is surprised that Disney hasn’t built a game around its characters.

Fireside Chat – Dan Porter

Dan Porter is CEO of social game developer OMGPOP.

• Facebook is becoming very saturated with content. It’s easier for established players (like Zynga) to recruit new players and promote new games. Very difficult for new players. On the other side, players are becoming more fickle, and jumping between games.
• People looking for funding must build something. Ideas are irrelevant unless you have a very strong track record already.

State of the Games Industry – View From the Top

This panel featured Matt Hulett (GameHouse), Owais Farooqui (Atari), Julie Shumaker (RockYou), Sean Spector (GameFly), and Omar Abdelwahed (Ubisoft). Themes were similar to the analyst presentations, with a strong emphasis on social and mobile games.

One of the key questions was whether new companies and new games will be able to penetrate, or whether the market will be dominated by big fish and established brands. The general consensus was that established brands (such as The Sims, or The Smurfs) that audiences already have a relationship with will be increasingly important. However, the panel was open to the possibility that new competitors can, with some luck, succeed – especially if they feature certain genres and gameplay styles that are currently underserved by social gaming.

There was a lot of talk about data here, as well as “discovery” and “virality.” One of the big issues is that it’s very difficult for audiences to find games – the key at the moment on iOS is to get into the charts and use that as a springboard towards more sales. If you’re not on the charts, it’s hard to break through.

With that said, I was surprised that the question of narrative wasn’t raised at all. I’m not discounting analytics at all – I think they are critical. However, traditional marketing and storytelling language (“compelling stories,” “appealing characters,” “emotional resonance,” “aspirational qualities”) was entirely absent. I think games designers are missing a trick here – there is nothing more viral than being affected emotionally by something and wanting to tell others about it. I’m not suggesting that mobile or social games need epic narratives (they don’t), but I do think that all those analytics and game mechanics could be enhanced by a simple, clean, appealing story that surprises and delights. Clearly from a transmedia perspective, it is essential that game elements are at least tonally and thematically consistent with the rest of the IP, even if the game narrative itself is relatively light.

The Social Factor: Building Communities

This panel featured Teemu Huuhtanen (Sulake/Habbo), Jack Buser (Playstation Network), Andrew Pederson (Tagged), Joe Ciarallo (Buddy Media), Greg Ovalle (Billing Revolution). There were a number of insightful observations.

• Online communities are built around commonality and a passion for a shared interest. This generates a shared vocabulary (a “fan vernacular,” if you will), and often there is no judgement.
• The consensus from the audience present seemed to be that online communities, and the relationships they can generate, are just as valid as “real life” relationships.
• The line between “real friend” and “online friend” is blurring because of social networking.
• We all adopt different personas for different platforms and occasions – it’s “self expression, like putting on clothes.” So users may use a pseudonym on World of Warcraft, real name on LinkedIn, and sometimes present half-truths and exaggerations (see Mark Suster’s blog for timely commentary on this)
• Sony: community can only form around something – a game, or a shared interest (cited example of online pool game). Community for community’s sake won’t work. Obviously this is a huge part of transmedia storytelling.
• A strong community creates loyalty, and increases the lifetime value of a customer. The customer will act as an evangelist, and a salesperson for you (also a big transmedia concept)
• Culture must remain recognizable and consistent. If you allow standards to slip, get confused, or get greedy (Myspace), the culture may erode. This causes lasting issues.
• Status is very important to PSN users. Virtual items that convey higher perceived status sell better (e.g. powerful armor or gold house). There’s an aspirational quality here – being something you might not be in real life.
• Putting “event” dates on the calendar can cause community to rally around that date. This could be a holiday, or even a cause. Fan communities will rally around social causes, and act for good.
• On that note, you can’t control fan behavior completely. Communities will form their own agendas, and act independently in pursuit of them.

Brands Got Game? How Marketers and Advertisers can Best Reach Gamers

This was a diverse but interesting panel. Participants were Neal Sinno (Arkadium), Christopher Erb (EA Sports), Mark Collins (MXP4), Aaron Smith (Wieden + Kennedy), and Precious Manchepalli (HSN). I had a great chat with Aaron Smith over lunch. He’s a big transmedia advocate and worth following on twitter.

• Mark Collins specializes in matching musical artists to brands, integrating game elements. For instance, a game where players “win” a song a stem track at a time (drums, then bass, then guitars, etc.). Upon completion of the game (and thus the song), the player got a free download sponsored by a brand partner.
• We’re seeing increased activity for music fans on Facebook. These kinds of games generate direct revenue, help to market the artist and music, and allow artists to assemble databases of fans.
• Electronic Arts is growing quickly in the social space. It is extending its IPs to different channels and has seen strong success with its FIFA Soccer Facebook community (a more basic version of its console titles). It is applying the same technique to the NHL.
• EA must be cautious because Madden, for instance, has preexisting sponsors. It must use those sponsors and must be cautious not to cause problems (e.g. with competitors).
• EA has partnered with consumer products. For instance, fans could buy a pack of Doritos to get a code allowing them to unlock Madden NFL’s 3D mode. This was framed as “fans prefer to buy the Doritos than pay an additional $10″; there was no mention that EA could have included the mode as a standard feature.
• EA wants fans to be able to play a version of its core titles everywhere. This, coupled with social communities, allows EA to become a lifestyle brand. The example of Starbucks was cited – moving towards a product to part of consumers’ life (on a related note, I’m reading Onward at the moment. Recommended).
• The Home Shopping Network has a games channel. This really demonstrates the breadth of this space. On one hand, you’ve got games that tie into complex narratives and feature quite complicated game mechanics. On the other, you have HSN, which features puzzle games which, when solved, reveal a picture of an item on sale (such as a handbag). Still, for the audience, this might be entirely appropriate and really drive engagement with the target audience.
• HSN games are often keyed to what is onscreen. If a product is being pitched, a game will accompany.
• Aaron Smith spoke of using games to extend brands and stories for TV shows, rather than inserting highly generic games stamped with a logo. Ideally, this would involve more collaboration with the core creative team behind the TV show.
• Smith said that people want to talk about shows, and want meaningful additional content in order to build a deeper relationship with a show and other games. If used appropriately, games can provide that.

Selling Games in the Cloud – Future Proofing Your Business Models

I’m not going to get into depth on this, although it was a good panel. Two things to consider: making online transactions as frictionless as possible, and juggling the (potentially) competing interests of brand integration and selling virtual items.

Gaming, Film and Television – How to Develop Successful Transmedia Franchises

Obviously the most directly on-topic panel for this blog, this panel featured Jeff Gomez (Starlight Runner), Katharine Lewis (FremantleMedia), Dan Yang (Viacom), and Alex LeMay (The Shadow Gang). I’ll not bother including transmedia fundamentals, which Gomez and LeMay covered vividly. It is worth checking out LeMay’s current project, GOBZRK, which is based around a novel and seems quite interesting. LeMay and Gomez discussed how these kind of deals can allow authors and producers to retain a greater share of equity, rather than immediately ceding all rights to media companies or other partners.

Jeff Gomez asked Katharine Lewis of Fremantle why audiences – having built strong emotional connections to American Idol contestants and their stories – could not then follow the contestants in the studio, on tour, and as they commence their careers. Lewis replied that while Fremantle would love to explore these stories in more depth, there are dealmaking complexities that render it very tricky. American Idol has several important and powerful stakeholders, and by the time they reach a consensus and make a deal, often too much time has passed. Then there may be insufficient profits (when the pool is split), to make it worthwhile. She stated, however, that Fremantle plans initiatives in this area and has several narrative IPs in the works.

Dan Yang of Viacom spoke about Viacom’s game unit, and the broader obstacles the company sometimes encounters. Generally speaking, Viacom licenses its brands to specialist game companies (the Activisions and EAs of the world) to make games. The panelists agreed that the emerging transmedia paradigm requires much closer monitoring of the game production by the IP owner (this is part of the transmedia producer role, of course). Katharine Lewis stated that with Fremantle, they always endeavor to get various creative parties in a room together to discuss the IP and anticipate issues. Dan Yang also said that sometimes big corporations like to wait until an IP is a hit in a single platform before anticipating how to extend it.

A question from the audience asked about Pottermore. Gomez explained that Pottermore represents the first time that the Harry Potter IP has been “unlocked” to give fans more meaningful story content. Fans will feel that JK Rowling is listening, and their views may be validated as more story content responds to their participation in the narrative, and the experience. Gomez stated that the power of transmedia in this kind of platform tied into one of the themes of the panels all day – organic, seamless experiences. He also stated that business models like Pottermore can be beneficial to all parties involved.