NOTE: GrowthBeat tickets go up $200 this Friday at 5pm Pacific. VentureBeat is gathering the best and brightest in modern digital marketing to help declutter the landscape, simplify the functions, clarify the goals, and point the way to success. Get the full scoop here, and register by Friday to save!
The Dutch government paid my way to Amsterdam, where I moderated a session at Casual Connect Europe. Our coverage remains objective.
AMSTERDAM — Developers love stability. If you give them enough time and a platform that works, they’ll eventually come up with something brilliant like Naughty Dog’s The Last of Us, which was published in the seventh year after the launch of Sony’s PlayStation 3. It was a masterpiece, winning 10 awards including Game of the Year at the recent Dice Awards (the Oscars of gaming). And that was because the developers just had to worry about making their game, not the technology around it.
But mobile clearly isn’t there yet. Mobile game and app developers still tread carefully when it comes to trusting the platforms that they are dependent upon for their business. Just this week, Facebook cut off two mobile advertising measurement companies, Kontagent and HasOffers, after it found that they allegedly violated its terms of service by keeping data longer than they were supposed to. This news became the talk of Casual Connect Europe, the game event in Amsterdam this week.
Too often, the decisions of today’s game platform owners are inadequately explained, and they come off as accidental, not intentional. That would be OK if it weren’t for the fact that whole ecosystems, digital economies, and even countries (like the Finns, the Canadians, and now the Dutch) are becoming dependent on these platforms.
Above: Mobile marketing options
Image Credit: Dean Takahashi
Now the many customers using those companies have to switch to other providers so that they can fully understand the effectiveness of their mobile marketing campaigns. And Apple also threw some developers into a state of panic when it began rejecting apps that used its Identifier for Ads (IDFA) without showing any advertisements. This happened after Apple phased out an earlier identifier out of concern that it could be connected to privacy breaches.
“The ecosystem is really new, and a lot of companies are still finding their way,” said Glenn Kiladis, vice president and chief games evangelist at mobile marketing firm Fiksu. “You have to be careful on privacy regulations and a lot of other things.”
The problem isn’t that platform owners are changing their platforms. I fully recognize that a platform that isn’t in flux is an ossified one.
It always helps when platform owners change things for the better so that developers can be more successful. The issue is more when there are conflicts of interest between the platform owner and the developer or third-party service companies. When the platform owner changes things that hurt some of the third parties, it comes under suspicion. The developers still feel like the platform owners are pulling the rug out from under them. And they often get very little notice. That’s what Andy Yang, chief executive of PlayHaven Kontagent, noted in his post responding to Facebook. His company had no chance for appeal.
“I don’t ever want to be dependent on a single platform again,” said Honor Gunday, chief executive of PaymentWall, a provider of alternative payments for apps, in an interview. “It’s an issue of trust.”
His company was among those that got cut off by Facebook a few years ago after its scandal with ads known as offers, where some shady operators ran ads that scammed users with bogus cell phone subscriptions. Facebook shut off all of the offer startups except for one, forcing Gunday to seek out other platforms such as the web. No one had ever complained that Gunday’s offer wall was scamming consumers.
Often, the platform owners have a great goal in mind. In 2009, Facebook cut off alternative-offer firm Offerpal out of concerns for consumer protection. It also limited virality on the social network out of concern about too much spam for non-game users. It created Facebook Credits, taking 30 percent of every transaction made for purchases of virtual goods in apps. Those moves hurt Zynga and other social game makers.
Apple shut off incentivized ads, throwing Tapjoy into flux because it was worried that the app marketers were manipulating rankings. And now both Apple and Facebook are worried about privacy issues and the protection of young users from overzealous marketing. Paul Gardner, an attorney for Osborne & Clark, told the Casual Connect Europe audience that virtual goods regulations are coming down the pike fast to protect parents and kids from excessive monetization scams aimed at children.
At a dinner a few weeks ago, Sean Ryan, head of game partnerships at Facebook, said about the spam problem, “Users, we find now, are generally happy. If you’re into gaming, you see gaming stuff. If you’re not, you don’t. Developers generally are happy. I won’t say it’s perfect. It’s not always balanced as far as growth versus mobile. But they feel like they can get access to users in an ROI positive way that makes their business work. That’s the balance. There was a period of time two or three years ago where they would say, ‘I don’t play games, and I’m getting spammed to hell here. This sucks.’ That’s gone away.”
Ryan also said, “You look at the three interest groups – users, developers, and Facebook. As long as there’s enough value to each side of that equation, it continues to grow and you’ll invest in the platform. When we first got there, users were getting unhappy with the level of spam, especially if you weren’t a gamer. Developers were thrilled. They were like, ‘Wow!’ In those days we had tens of millions of people, not hundreds of millions, but you could just pound unrelentingly. Facebook was mixed. It was a good use of the platform, but it didn’t feel like the right balance.”
Most companies can sympathize with the need for platform owners to police and clean up their platforms. But it’s no wonder that the current mantra of the industry is to become an “indie” — an game developer who isn’t dependent on any one platform. And it’s no wonder that we see the seeds of rebellion against the decisions of the platform owners.
Above: Albert Lai of Big Viking Games
Image Credit: Dean Takahashi
The distrust comes because the platform owners like Apple are hurting some of the best tools that developers have to monetize their apps. And when they compete with two million other apps in the iOS and Google Play app stores, the developers desperately need something to work in their favor. Schemes to improve discoverability or monetization can run afoul of platform rules. And that often leaves the fate of app makers in the hands of platform owners like Apple, which can make or break an app by deciding to feature it. And Apple can tell developers to avoid putting their games on other platforms — or risk losing the right to have their app featured. Some developers don’t trust Apple to make “featured app” decisions in a way that is completely fair.
The app world is feeling the pain that comes from swift changes. In other types of gaming, the same kind of conflict is happening. Valve has created the potentially disruptive Steam Machines platform because it was worried that Microsoft would move in the direction of Apple, allowing only one app store where purchases of digital content had to happen through its single solution. Valve is creating a Linux-based SteamOS because it doesn’t trust Microsoft will do the right thing for platform fairness and for consumers.
Valve is in a position to this because it has 75 million consumers who use its Steam digital distribution service. The company can arguably make the case that it is doing more to look out for the interests of consumers than Microsoft is, based on Microsoft’s platform decisions. Valve wants to be truly independent and free from vulnerability to platform changes that are beyond its control.
HTML5, the lingua franca of the web, was supposed to change some of this because it works on almost any platform. And it has, a bit. Spil Games chief executive Erik Goossens said this week that his company has published 200 games in the HTML5 format and it will publish more than 1,000 by the end of the year. But those aren’t necessarily high-end games that are pushing the edge on technology, performance, or other features.
Albert Lai, co-founder of Big Viking Games, invested heavily in making technology tools to build his own HTML5 games over the past couple of years. The first one he shipped, Mech Force, was a “disaster,” he said in a talk at Casual Connect Europe.
“The technology was far too immature for what we wanted to do,” he said.
But he took the risk anyway and stayed the course because “mobile is a red ocean of noise, clutter, and sophisticated competitors.”
He added,”It’s a giant bloodbath out there.”
Lai wanted to take the risks out of development by relying upon HTML5. It allowed him to escape platform owners that charged a 30 percent fee for all virtual goods transactions. He dealt with added costs of development — about two times to ten times more time and resources — in order to attain a measure of independence. One day, he’ll get it right and create a brilliant work of art on HTML5.
Platform owners should take note. Developers are willing to go through a lot of pain to avoid platform dependence. God forbid that one day they won’t need your platform anymore. If you have enough foresight, you’ll create a stable platform that will one day lead to brilliant works of art.
Apple designs and markets consumer electronics, computer software, and personal computers. The company's best-known hardware products include the Macintosh line of computers, the iPod, the iPhone and the iPad. Apple software includes t... read more »
Facebook is the world’s largest social network, with over 1.15 billion monthly active users.
Facebook was founded by Mark Zuckerberg in February 2004, initially as an exclusive network for Harvard students. It was a huge hit: in 2 w... read more »
Powered by VBProfiles
GamesBeat 2014 — VentureBeat’s sixth annual event on disruption in the video game market — is coming up on Sept 15-16 in San Francisco. Purchase one of the first 50 tickets and save $400!