The Funware Blog @ rmbr

Jessie Scanlon of Businessweek has written an excellent and incisive article about rmbr and Funware. It just launched in the Innovation and Design section of the site, and you can take a look at it here.

Ok, so the sales data is out for 2007, and it’s freaking awesome!

The games industry in the US recorded a whopping 43% increase year over year from 2006 (admittedly a bit of a sideways year) and 2007. And - even more encouraging - the increase was felt across both hardware and software, boosting the industry overall in a slumping economy.

I remember that when I took my first games industry job, I had a lengthy conversation with my then bosses about how we seem to defy economic logic, posting revenue increases when the economy goes down (and even when it seems to be skyrocketing). What is it about games that makes them free of the usual economic constraints? Some theories:

• Games are a better value than other kinds of media, giving consumers significantly more hours of gameplay per dollar than any other category.
• Games are ascendant, grabbing users from all other kinds of media (and the concomitant advertising dollars), and this is independent of the macro-economic cycle. Put another way, this is a major, 20,30 or 50 year long cycle of growth that we’ve only recently begun.
•  The “Games Industry” is very broad. Unusually, our industry includes hardware, software, services and B2B products (like advertising, developer platforms, etc), so it’s really more like 3 or 4 different verticals all lumped together (casual game download sales and movie licensing revenues have very little in common).
• Console wars are the equivalent of a major stimulus package. With billions of dollars at stake, console manufacturers and their software partners pump a ton of cash into the game economy to ensure the success of their new ventures, effectively greasing the wheels of the category.

I’d love to hear your thoughts! Dean Takahashi has a good take on the issue (from the “why 2007″ perspective).

And the best part about all of it: these figures don’t even take into consideration the extraordinary growth being seen in new verticals (e.g. casual MMOs) or international markets. In short, perhaps, the best is still yet to come. Here’s to an even better 2008 - led by Funware enthusiasm, no doubt.

Oh, and as a small aside. 2 years ago at E3, Cal Morrell and I had a little wager.  I said the Wii would win this round of the console wars. He said “no freakin way”. Apparently, we’re both a smidge right, although his prediction that it would be the PS3 was certainly off. The Wii handily outsold in terms of total units, but the XBox was the cash king in 07. My further prediction: the Wii continues to grow its unit lead this year. Care to double down, Cal?

As conference season approaches, it’s interesting to read the blog posts and comments of many of my peers on the subject of games & social networks. Some of the posts have been really illustrative, while others have muddied a couple of concepts so fundamental that they call into question the writer’s entire thought process. That was a (mild) exaggeration, but I think you deserve a drill down into some of the key vectors for analyzing the world of “social games”. My talks at CGA:Europe and GDC will cover these topics in greater depth, should you be around for either of those.

There are 2 different kinds of games in the social network context:

• Games that use social networks for distribution or gameplay (Social Games)
• Games that require social networks for gameplay (Socially Connected Games)

Social Games are typically titles whose designs existed prior to the rise of sites like Facebook and Myspace. Poker, Match 3s or Scrabble are examples that have been reinterpreted as Zynga’s Texas Hold ‘em, Rock You’s Ultrablock or Scrabulous by the company of the same name. As a general rule, developers use social networks to do one of two things with these game designs:

• Increase distribution: by building in the ability to do direct address book invitations and forwards, developers make it simple for users to get their games in front of large groups of people, radiating out in circles from the original user. There is also the option of doing paid, direct distribution with companies like RockYou and others where an app rides along with one of their installs…for a fee.
• Simplify Multiplayer and Notifications: Using social network infrastructure as a backbone, messaging, player matching and high score management can be more readily tacked onto an application. This is especially true in MMO-style social networks like Facebook that expose almost all functions to API calls.

What most games in this category lack in originality, they make up for in improved economics (yay! investors!) and time to market. While it’s not pejorative to say that games with a social network tie-in are boring from a design standpoint, it bears noting that all the recent entrants to this space open themselves up to some obvious competition. For example: Pogo. Why on earth wouldn’t a Pogo-in-Facebook application simply roll over on everyone who’s trying to build a comparable experience in the Blue-n-White? Why don’t the current crop of FB games have the stickiness and recidivism of SuperWall, when we’re professional game makers?

Ah, the philosophical questions of our time. Kant would be rolling over in his grave, I assure you.

Meanwhile a whole crop of folks are busy working on Socially Connected Games, designed with social networks as an intrinsic part of the game design. As a small aside, this is the category where most Funware applications would normally reside, if they were doing their jobs well. And while this seems like an obvious next step for most casual game designers today, the majors are surprisingly silent in this vertical. Some interesting examples of games like these are:

• Likeness - where you play a series of quizzes to determine how you resemble your social network.
• Vampires - where you bite (slap, kick, etc) someone and they do it back to you/to someone else.
• Name That Friend - where you guess which friend has a particular characteristic or said something (extracted from their profile).

In each case above, the designers used the social network intrinsically in the design of their games. Put another way, there would be no effective way to play them without a social network. Yes, email would serve as a messaging system, but it wouldn’t allow the underlying game to be effectively played. It is no coincidence that games like Likeness and Vampires have significantly more regular users than games like Scrabulous or Poker. By making use of the intrinsic network structure, developers leverage the desires and inhibitions of users to get them engaged. Directly.

Now, I’m not the first person to concern himself with this topic. Brenda Braithwaite, Nabeel Hyatt and Scott Siegel have all done excellent jobs of addressing both the taxonomy and mechanics of games in Facebook. I really like their recent discussions on the subject, and they will be driving even more important, directional talks at GDC that you should check out.

In the meantime, I’m curious to hear what you think about the world of Facebook games and where you think they’re headed. I’ll have more to say about the opportunities for Funware in Facebook in short order.