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User-generated content (UGC) has been around for decades. But what started as fan-made levels and story campaigns is quickly growing into a profession of its own, with games like Roblox and Minecraft paying out millions to in-game creators every year.

Additionally, more companies are starting to believe that UGC will serve an important role in the creation of the metaverse.

“In the beginning [UGC involved] hacking and trying to build mods based on reverse engineering games. Then the next phase was when IP holders and game developers released creation kits and allowed the community to build mods. … But now we’re at an inflection point through games like Roblox and Minecraft,” said Overwolf CEO and co-founder Uri Marchand.

At our GamesBeat Summit Next digital event, Marchand spoke with Michael Lewis (vice president of direct to consumer at Take-Two Interactive) and Oscar Navarro (vice president of mergers & acquisitions at Ubisoft) about the future of UGC and how it can benefit developers, players, and modders alike.

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The panelists first explained why it’s a great time to consider mod support. Lewis said that after the industry hit a bit of a lull with modding — a period he described as really “complicated and challenging” for studios — developers are coming back to it now thanks to new tools (like Overwolf’s own modding platform).

“It’s starting to get a lot easier again for us [as] developers and publishers to make our games moddable. And that’s a major change,” said Lewis.

For triple-A studios like Take-Two and Ubisoft, the process for supporting mods can often take awhile, and it comes down to figuring out the right franchise and the right team for it. Navarro said Ubisoft has to consider which games it’d like to have mods for “based on the audience [and] based on engagement.”

He added that the company is still experimenting with modding, bringing up Watch Dogs as one of the franchises they’re trying it out with.

“If we allow somebody else to start modding some of our most famous IPs, we need to focus on an onboarding process that allows some checkups and security, access, moderation … and what kind of boundaries we may put on allowing these new mods,” Navarro said.

Both Navarro and Lewis see modding as a great way to extend the shelf life of a game. Lewis noted that video game companies are no longer just competing with each other: They’re also competing for people’s attention with Netflix, Hulu, and other entertainment services. He said that “it’s really freaking hard to create high quality content,” and mods can help developers win that battle by giving people more reasons to play their games.

Lewis wants to make mod creation as accessible as possible and have robust security features in place so players can safely download them on their PC or consoles.

“How can we make it a lot easier to create mods and to create the really high quality mods that motivate folks to keep playing more? And on the [other] side, what can we do to make mod discovery really easy?” asked Lewis.

But for that to happen, developers and publishers also need to help modders make money off their creations (like with the Roblox community), thereby incentivizing them to create more content. Historically, only a small amount of creators in any development ecosystem are able to make money. So the challenge, according to Lewis, is to create an infrastructure where a “middle class” of UGC developers can emerge, and if they want to, there is a path for them to turn their hobbies into full-time jobs.

“To having some of the finest mods in the world and mods that rival endgame content, thinking early on about that path toward monetization is really important because it takes a decent team of folks who are entrepreneurial to be able to do that, [and we should be] giving them a runway and a playbook on how to do that,” said Lewis.

Marchand mentioned that companies can use newsletters or blog posts to update the creator community about the game and its mod tools, as well as host hackathons to keep them learning and engaged. Another possible method is mentorship: Overwolf sometimes takes talented creators from the community and introduces them to people on the development team so that they can improve their content.

“Once it’s happening, and you’ve crossed that phase of getting [a community] started, then it kind of becomes a machine that feeds itself, which is a wonderful thing to see and everyone can benefit from. But it takes a while to start,” said Marchand.

The process could take years, the panelists warned, depending on how early developers start thinking about mods in their games. Some reprogramming will also have to happen on the audience’s part because there’s a longstanding expectation that mods should be free. Lewis reflected on his past experience at Twitch, when the company was able to warm up viewers to the idea of paying their favorite streamers by implementing donations and Bits (Twitch’s virtual currency).

He said developers will have to figure out if players are clamoring for mods in their games, and if they are willing to support the creators that build them. For that reason, companies shouldn’t immediately be thinking about making a ton of money when first planning for UGC.

“I think it’s much more important to think first about, ‘How do we give the community tools to create really high-quality mods?’ And then once we start to see really high-quality mods, then it’s about, ‘Are there ways that we can better foster and drive that flywheel [with monetization]?” said Lewis.

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