December 14, 2021
This week in Protocol Gaming, your weekly guide to the business of video games: Ubisoft’s official NFT launch kicked off a heated blockchain gaming debate, Epic stunned the industry with its Matrix demo for Unreal Engine 5, and Activision Blizzard employees stepped up their unionization efforts.
Non-fungible tokens, and the blockchain platforms that power them, are either the next big shift in video game monetization — akin to the free-to-play movement started in Asia nearly two decades ago — or they’re a scam repackaging the same exploitative business models that have plagued gaming for years. It all depends on who you ask, and probably whether they’re holding Ethereum or Solana.
Of course, there’s plenty of gray area in between those two extremes, but you wouldn't know it by looking at the reaction to Ubisoft’s launch of its Quartz platform. Ubisoft announced Quartz last week with a simple YouTube video and website detailing its first three NFTs, part of an in-game cosmetic drop it’s calling Digits, for the shooter Ghost Recon Breakpoint.
Reactions to Quartz were polarized. Those bullish on the prospects of blockchain gaming saw Quartz as a turning point; Ubisoft had officially become the first major game publisher to jump head first into the NFT space. But many, many others had an opposite and more visceral reaction.
Quartz is not particularly remarkable or all that threatening. It’s easy to see how concepts like NFTs and cryptocurrency, when combined with the game industry’s penchant for wringing profits and player exploitation, can go terribly wrong. But Quartz is benign, and nothing more than Ubisoft staking a small claim to an industry that’s already producing multi-billion dollar startups.
Blockchain gaming is happening, regardless of its mainstream reputation. If the cryptocurrency boom of the last decade is any indication, NFTs and the communities creating, buying and selling them are here to stay. And blockchain gaming startups are attracting massive venture capitalist interest with the promise of explosive player and revenue growth.
The backlash to gaming NFTs is representative of a much more consumer-minded and vocal gaming community that for years has watched some of the worst tendencies of free-to-play expand from bottom-of-the-barrel mobile games to big-budget blockbusters. The trepidation to unleash an unregulated and speculative market rife with scams and get-rich-quick schemes is not only understandable, but in many ways commendable.
But gaming companies have an obligation to pay attention, especially if such technologies pose an existential threat to their business. Pouard told me that he looks at decentralization a bit like Minecraft, a once-in-a-generation game that revolutionized how we think of gaming sandboxes and user-generated content. And game makers like Ubisoft cannot afford to be looking the other way when the next Minecraft arrives.
Big Tech and gaming platform wars
Big Tech is more interested than ever before in trying to own and define the platforms of tomorrow, but game companies have their own unique visions for how we’ll play and socialize in virtual spaces in the future. Join Nick Statt in conversation with Manticore Games CEO Frederic Descamps and Zynga CPO Scott Koenigsberg at 10 a.m. PT on Tuesday.
As companies planned their future workplace strategy, it was no longer about whether or not remote workers could be productive — productivity was booming! The question became about how to retain that level of productivity and happiness without risking burnout, sacrificing the workplace culture and leaving behind the innovation that comes from in-person collaboration.
“The current Super Smash Bros. has too much of my personality poured into it. In order for a long-time series to continue thriving today, we need to think about eliminating the series’ dependence on just one person’s vision.” ―Masahiro Sakurai reflected on his work on Nintendo’s long-running fighting game series in an interview with The Verge. The future of Super Smash Bros. remains uncertain after development on Ultimate has wrapped up.“We should have known before and just been honest with ourselves. We were there not out of deception, but more out of ... hope. And I don’t think hope is a great development strategy.” ―Xbox chief Phil Spencer told Bloomberg about the thinking inside Microsoft and subsidiary 343 Industries leading up to the Halo Infinite delay. Ultimately, the extra year ended up saving the project and turning Infinite into a success.
On Protocol: Epic Games last week debuted The Matrix Awakens, a tech demo for Unreal Engine 5 featuring Keanu Reeves and Carrie-Anne Moss. It features stunningly photorealistic graphics and an open-world design, offering developers and players a peek at the possibilities of next-gen gaming in the years to come.
Pokémon Unite’s major milestone. TiMi Studios’ online Pokémon battler has reached 50 million downloads as of last week, just four months after release. The game, available on the Switch and mobile, is helping Nintendo tackle competitive free-to-play market.
Activision Blizzard employees get serious about organizing. After months of inaction from management and layoffs at subsidiary Raven Software, the employee activist group ABK Workers Alliance is now organizing ongoing strike efforts and a legitimate unionization campaign with help from the Communications Workers of America. A GoFundMe set up to support striking workers has also raised more than $300,000.
On Protocol: Twitch co-founder Justin Kan yesterday announced his return to the game industry with Fractal, an NFT marketplace for the buying and selling of gaming-related tokens. The platform hopes to be what OpenSea is to digital art, as well as a blockchain infrastructure provider to game studios that want to dive deeper into Web3.
Apple wins again. After what seemed like a resounding victory against Epic in the Fortnite antitrust trial, Apple found itself back on the defensive when it tried over the last two months to delay a court order over in-app payment alternatives, the one bright spot for Epic in the court’s verdict. Apple was finally granted its stay last week the day before the deadline.
Bowser slammed over Switch hacks. Gary Bowser, an aptly named Canadian hacker well known for building and selling Nintendo Switch jailbreaking and modding tools, agreed to a $10 million settlement for his involvement in hacking group Team Xecuter, The Verge reported. In total, Bowser is paying $14.5 million to Nintendo when including his piracy charges.
Sony’s acquisition spree continues. The PlayStation maker is ending 2021 with yet another acquisition, this time of Seattle-based developer Valkyrie Entertainment, Gamesindustry.biz reported last week. Valkyrie is known best as a support studio, having recently aided Sony’s Santa Monica Studio in God of War and God of War: Ragnarok development.
PUBG embraces free-to-play. The battle royale title that kickstarted the trend is embracing its future as a mobile-first, free-to-play game by removing the barrier to entry for its console and PC versions starting next month. Since 2017, the game has cost $30 on non-mobile platforms.
Square Enix had some unpleasant news for Final Fantasy fans this past weekend when it announced the retail price for the Epic Game Store version of Final Fantasy VII Remake would be $70.
To console gamers, that higher price tag has been a fixture since the launch of new consoles a year ago, but PC players have spared the $10 price increase for big releases like Call of Duty: Vanguard and Battlefield 2042. Now, game makers are becoming more comfortable slapping higher price tags on new products, even when those products are only higher-quality versions of older ones with a few extra perks thrown in.
Thanks for reading. Tell your friends and colleagues to subscribe here, and send tips, feedback and ideas to email@example.com. See you next week.