A Services Strategy for Casual Games

Gamasutra posted up an article that has been bouncing around in my documents folder for a little while. The original title was "A Services Strategy for Casual Games", but the new one is a bit more punchy.

One response that I've heard quite a bit is that portals will never allow user data to be released back to developers. This is quite true for most established portals that have traditionally focused on selling packaged goods online. However, middlemen adapt and markets flow around stupidity. More sophisticated variations on sites like http://www.mmoportal.com/ are bound to emerge. If a dozen portals don't want your business, find the one that does. Given time and a exclusive supply of successful games, they'll grow into a bigger fish that can help feed your team.

The portals are engaging in a kneejerk reaction to changing business models. In the long run, do they really think they can keep customer data away from developers when the games that players want are online services? Such companies just end up being a roadbump in the way of progress. A portal that gets irritable about giving up customer data guarantees that their cut of the pie is zero. This is their loss, not yours.

take care
Danc.

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The Naked Business

An essay on how to treat customers and employees like owners and reap the benefits.

In any meeting, a negotiator can adopt a variety of strategies. Typically, they horde information, pick apart their opponent's every move in hope of understanding hidden meaning, and ultimately attempt to gain the upper hand through manipulation. Sometimes you outsmart your opponent and win. Many times, you are so busy protecting yourself that a deal never happens.

There is a less common negotiation strategy that relies on going completely naked. Instead of hoarding information, you give it freely. You openly explain both your needs and what you have to offer. If the other person reciprocates with open arms, you can work together to capture amazing opportunities.

It occurs to me that many private companies play the game of business as a negotiation situation where their customers and employees are opponents that must be outsmarted. Many deals are left on the table. What would happen if they instead used the naked negotiation strategy? Imagine a company that says to their customers with conviction and honesty, "Here is what I have, and here is what I need. Let us work together to create mutual value."


The rules of an Open Kimono business
The following are simple rules of thumb that guide the behavior of a Naked company.

• Rule #1 - We are all in this together: By purchasing a company's product, a customer becomes invested in company's continued success. By working at a company, an employee also becomes invested in company's continued success. In all areas, both the customer and the employee contribute to the business and deserve to share in its success as owners.
  
  
• Rule #2 - We share information freely: Where possible, aggregate information that is shared freely within a company should be shared freely with the customers of a company. More is gained from sharing than from hoarding. We seek to build trust, empower both customers and employees, and solve problems together with the best tools possible.
  
  
• Rule #3 - We win through the creation of superior value: In competitive situations, by erring on the side of openness and honesty, we discover mutually beneficial solutions. As a result the company succeeds by being able to offer superior value compared to those companies that attempt to get ahead through trickery or manipulation of perception.
  

Examples
All this is lovely sentiment, but what does it mean? The following practices might vary depending on the exact company, but here is a good start.

• All major financial data is posted in an easy-to-comprehend fashion on the company web site
• All major company metrics, goals and progress towards those goals are publicly posted and constantly updated.
• Periodic customer research is performed and the results are also made available to all customers and employees.
• 5% of profits are redistributed back to existing customers. Another 5% is given to the employees. If desired, the money can be donated to a charity or reinvested in company stock.
• When problem areas are identified, customers are encouraged to contribute suggestion, time or resources to the solving of the problem.

Roots of the Naked business
The roots of the Naked business are quite traditional. Successful companies have been using these techniques for years.

• Public companies: Public companies are required by law to divulge certain internal information to their stock holders. The result is that dishonest behavior is not allowed to fester for long without being exposed to the light of reality. It is debatable however, if public company's slavish devotion to quarterly stockholder gain is a positive long term strategy. A Naked company that has the transparency of a public company, but is measured on pertinent long term business metrics instead of only short term financial data.
  
• Open Book Management: By sharing pertinent company information with employees, companies run by open book management empower everyone in the company to innovate towards a common goal. A Naked company uses the same technique to leverage not only the distributed power of their employees, but also the distributed networking power of their customers.
  
• Market Orientation: Companies with market orientation listen to both the needs of their customers and the trends in the market when making strategic and tactical decisions. A Naked company's close two-way communication with its customers allows it to respond effectively to the latest market information.
  
• Market as a community: Markets are often looked at as system in which buyers and sellers exchange value, where value is defined in financial and material terms. Yet strong emotional bonds form between buyers and sellers that can bring substantial social value to both parties. People will always seek to find meaning in their actions, yet companies often ignore this fundamental need. A Naked company provides both customers and employees with a self-contained community that encourages, nurtures, and thrives upon the creation of social value.
  

The case against the Naked business
When I bring this concept up to people, the inevitable reaction is "What an idealistic notion. Unfortunately, the world does not work like that." It is utterly self evident that close management of information is essential to any financially successful venture. In no particular order, the following are considered to be fatal flaws in the Naked philosophy.

• Severe competitive disadvantage: The moment a company provides open information to the public, competitors will use that information to gain an advantage. Copycat tactics, preemptive product releases and attack ads that further publicize embarrassing information are all likely.
  
• Expensive: By spending time providing reams of information, small companies are using scarce resources ineffectively. Seeking more sales or creating a improved product will yield better results.
  
• Customers lack of business skills:No benefit is gained because customers lack the skills to interpret company information in any meaningful fashion.
  
• Public relations nightmare: Honest publication of information means that the company will be displaying warts and all to the public. There is little opportunity to spin bad news or manage your financial data.
  
• Customer relations nightmare: If you give customers a sense of empowerment, they will complain endlessly and publicly. This in turn leads to bad press and a loss of sales.
  
• No one is doing this: Few profitable companies operate in this fashion. They must have already failed.
  

The case for a Naked business
The following are benefits of an OK company.

• Passion: Companies with a strong vision tend to outperform those that focus solely on financial results. By building a culture around a philosophy that people can wholeheartedly believe in, employees and customers will give the extra effort necessary to ensure success.
  
• Strong word of mouth presence: A company with a unique and appealing ideology stands out in the crowd. The fact that customers benefit from this ideology yields a powerful source of word of mouth advertising.
  
• The customer's network is the company's network: A customer that truly believes that they are invested in a company feels comfortable sharing their contacts and resources. At the extreme end, the customer is a believer that happily volunteers for the company. A thousand customers have a larger and potentially more powerful network than a hundred employees.
  
• Faster response to market change: Customers that complain or offer advice provide a highly responsive early warning system to changing needs or competitive threats.
  
• Many eyes catch stupid mistakes: Strategic blunders are easier to catch when you have multiple people offering unbiased commentary.
  
• Increased customer trust and loyalty: This in turn leads to retention and improved profits. Why go elsewhere when a company concretely demonstrates that it is deeply interested in listening to your needs?
  
• Increased employee trust and loyalty: This also leads to retention and improved profits. Employees are the core asset of a knowledge-based company. By keeping them, you build an experience based sustainable competitive advantage.
  
• One reality: The cost, both financial and psychological, of keeping multiple books, one for the public, one for the employees, and one for the investors is greatly reduced. The benefit is that customers and employees can talk the same language and use the same data to create mutually beneficial outcomes.
  

Key implementation areas
Let's suppose for a moment that benefits of an Open Kimono philosophy outweigh the detriments. What are the success factors that must be focused on to gain those benefits?. The follow are key implementation areas that must be addressed in order to achieve success.

• Dedicated Leadership: Any culturally driven sustainable advantage needs to have buy-in and support at the leadership level. Words alone are meaningless. Consistent public actions by respected leaders help the cultural change permeate through the entire organization.
  
• Customer and Employee Education: Data is useless unless the intended audience is capable of understanding it. Putting company information in format that is comprehensible to the customers and employees is a partial solution. Actively educating both customers and employees on the meaning and use of the data is equally important. If there is not an obvious connection between the data and the benefits received by the person digesting the data, then the system has failed.
  
• Filtering through the noise: When everyone yells their opinion, it can be hard to capture any useful information. Rigorous data collection and analysis techniques can turn the outpouring of information into actionable solutions.
  

Conclusion
A strongly customer and employee oriented company is more likely to prosper than a profits oriented company. Profits are still important, but it is wise to remember that they are one metric amongst many. By focusing on satisfying a broad range of benefits instead of merely materialistic and financial benefits, a Naked company attracts and retains both superior quantities of customers and superior quality employees.

In the end, running a Naked company is as much a personal choice as it is a business decision. Openness, honesty, community and mutual respect are concepts I can believe in. All else being equal, what type of business would you want to devote your life to?

take care
Danc

PS: With some minor changes, this was an essay I wrote many years ago. In the subsequent years, transparency has come en vogue and it now seems everyone is spouting its praises. Which is a great thing. This message needs to be broadcast as loudly as possible lest it be lost in the morass of sub-optimizers twisting the truth in the name of profits.

References

• Transparent CEOs: http://www.wired.com/wired/archive/15.04/wired40_ceo.html
• The Naked Corporation: http://www.amazon.com/Naked-Corporation-Transparency-Revolutionize-Business/dp/0743246500/ref=pd_bbs_sr_1?ie=UTF8&s=books&qid=1198022917&sr=8-1
• Open book management: http://en.wikipedia.org/wiki/Open_Book_Management
  

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The Circle of Life: An Analysis of the Game Product Lifecycle

My article introducing folks to the genre life cycle is up on Gamasutra.com. Woot. Gamasutra is a site that I respect quite highly, so I'm honored to see them taking an interest in these esoteric writings of mine. :-)

Let me know what you think:
http://www.gamasutra.com/features/20070515/cook_01.shtml

take care
Danc.

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Rockets, Cars and Gardens: Visualizing waterfall, agile and stage gate

The further I dig into new product development practices the more I crave a simple way of helping folks new to the concepts visualize them quickly. In that spirit, I've assembled a little pictorial journey through the intriguing landscapes of waterfall, agile, portfolio management and stage gate. For fun, there is also a description of how you can apply portfolio management techniques to individual agile project as a technique for additionally reducing the design risk.

The concepts illustrated here are readily applicable to most software projects including games, websites and of course full desktop applications.


Software development as a learning exercise
All the diagrams start with two premises:

• Knowledge is critical to success: A large number of software projects fail because we build software that has little real world value. If you dig into the reasons, even teams with great production skills claim they focused on the wrong issue or they really didn’t understand what the customer actually wanted. When you build the wrong software, you end up with useless code, loss of political support and eternal development cycles. If only the team had reliable knowledge of what to build, they could deliver value early.
• Most product teams start with very little practical knowledge: Knowledge is great, but we start projects with hardly any. We don’t know exactly what our customers want. We don’t know how our design will work when it runs smack into the complexities of the real world. We don’t know what new opportunities and constraints will emerge in the future. Even when we are experts from a related domain, the best we typically have are theorems, guesses and opinions.

Product development is about rapidly producing targeted solutions that generate maximum customer value. In order to do this efficiently, our teams need to be learning teams that are constantly gathering concrete domain knowledge about customer needs. A team that learns the quirks of its customers, code, and business rapidly will often out perform teams operating without this knowledge. With this concept as a filter, let’s take a look at some typical development scenarios and how they are affect by team learning.

Typical product development of a single product
In most traditional waterfall models, teams gather requirements, develop the product and then test it in order to see if they implemented the spec correctly. Only after they release do they gain any insight into what the customer actually desired. The metaphor that is often used is that of launching rocket towards a destination. You get to aim it once and then you fire it off and pray that you hit the target. All well and good, except A) this is a rocket that burns money for fuel and B) when it misses its target, entire teams (and sometimes entire companies) get the ax.


Now, not all is lost. If your company has enough money to burn, they can try again. There is a good chance the team learned quite a bit about what their customers actually desired by failing in the marketplace, so the next moonshot has a better chance of landing closer to some actual customer needs.



The old joke is “If you want to build a good piece of software, rewrite it four or five times.” Eventually, if you keep trying long enough, you’ll hit a target market that wants your product. Some very big companies have made a staggering amount of money following this dogged pursuit of success. They fail again and again and again, but their few successes fund the further pursuit of new growth businesses. The learning is quite expensive but very valuable.



Room for improvement
This pattern of eventual success through multiple failures has been well established in all sorts of new industries. A few smart companies have identified two basic strategies for speeding up the time it takes to identify a new successful market.

• Standard portfolio model: Fail in parallel. By trying lots of different options all at once, a few will succeed.
• Iterative model: Fail sooner. Try something simple, test it to see it works and repeat.

Standard Portfolio Model
If the waterfall process is like firing a rocket at a target, the portfolio model is like firing a swarm of rockets and hoping one hits. The company greenlights a large number of projects, funds them fully and hopes that one of them will blossom into a success. In return for spending more money, you rarely have to wait until version 3.0 to observe success.



This model tends to be highly useful when the target market is poorly understood or ephemeral in nature. For example, in the music industry, when user tastes change every month, it doesn’t make sense to spend three years attempting to evolve an individual album to fit the market. It also tends to be useful when the cost of development is low and potential payoff is high. The incremental cost of green lighting one more project can be easily offset by the incredible amount of money a successful record produces.

The big benefit of the portfolio model is that it allows you to try completely different options simultaneously. Companies are often put in situations where more than one idea has potential and they lack the information to choose which ones to fund. If they were forced to choose only one, they would often miss out on creating multiple product lines. Instead of putting all your eggs in one basket, a portfolio model spreads the risk and increased the chance of multiple innovative breakthroughs.

The Achilles heel of the traditional portfolio model is cost. Smaller companies have difficulty funding one project, never mind ten or twenty.

The iterative model
Smaller teams have learned to maximize their learning opportunities by building lots of opportunity for rapid feedback into their process. The agile software development movement is the poster child here, but many of the same lessons are found throughout lean manufacturing, kaizen and other successful practices used by product development companies across a broad spectrum of industries.



The common metaphor is that of driving a car as opposed to launching a rocket. At every possible opportunity, you are looking ahead and adjusting the team’s trajectory in order to steer towards. Each change may seem subtle, but due to all the rapid cumulative adjustments, the team hone in on their targets quite efficiently.



It ends up being okay that the team makes little mistakes. If they veer off a little bit to the left, that's fine. They rapidly learn it was a bad idea and correct their efforts. The short feedback cycles ensures the big mistakes happen far less often.



Instead of taking 12 to 18 months to create and evaluate a new concept, they build and put new version in front of users every 2 to 4 weeks. They also work in high bandwidth environments where all the team members are close together and close to the customer. Team members converge on and build concensus around good ideas over a period of hours, not months. Teams become experts through intense hands-on problem solving and testing. This ends up building products much more likely to serve real needs than those imagined in Platonic specs by ivory tower experts.

Agile development is favored by small start up teams because the techniques greatly reduce the risk of an individual team failing. If you only have room for one shot at the target, you might as well steer your way to success using lots of rich information instead of launching blindly into the unknown. Long term, agile processes delivering more value sooner, with lower overall risk.

An agile project is intensely focused. In the rush of completing only high priority features, many alternative concepts never get the chance to be explored. Customers, a rather vague and argumentative bunch at best, are required to speak with one voice in the name of reducing noise and thrash for the team. For many teams struggling just to get software out the door, these traits are a godsend. The downside is that there is little concept of strategic portfolio management.



Agile projects can be a bit like a hill climbing algorithm. They will steer towards the closest customer success story, but may ignore a bigger opportunity further away.

Stage Gate: Cross breeding portolio models and iterative development
We can do better than either pure agile or pure portfolio development. The stage gate process borrows a little bit from both iterative and portfolio techniques. You are still launching multiple products, but then you use iterative development techniques to guide each project towards success. You kill projects that fail to meet your goals.



Imagine that we are gardeners. We seed a diverse portfolio of projects, some high risk, so low. As we add team members and customer feedback, the projects begin to flourish, winding their way up towards the sunlight of launch. The core team development practices can be agile since we want to encourage short cycles of rapid feedback. The best ones start to blossom and ripen with obvious customer value. However, some projects are sickly and seem unlikely to produce much of anything.

As gardeners, it is also our job to groom the garden. The weak projects are trimmed back and turned into mulch that helps nourish the most successful projects as well as create a bed for seeding even more promising ideas. The best projects are harvested and sent off to customers, rich with ripe features, bursting with value. We are constantly seeding new projects to keep our portfolio balanced.

We’ve added three items to the traditional agile model.

• Diverse seed teams: The first is the concept of multiple teams heading in different directions with different goals. There isn’t a single customer, but multiple customers driving multiple potential success strategies.
• Kill Gates: The second item is the concept of gates every few iterations that kill poorly performing projects. It is better to return those resources back to existing projects than to continue investing. You can think of the success criteria that drives the gates as a set of reasonable constraints. The team is allowed to do whatever it desires as long as it meets the outlined constraints that are measured at each gate.
• Concept banks: The third is the concept bank where old ideas are stored for possible recycling. You never know when the remnants of an old idea will nourish a strong new project.

You may start out with dozens of projects, but in the end you’ll only launch a few into the market. The combination of trying lots of directions with very small low cost agile teams dramatically increases your opportunities to learn compared to either pure iterative or pure portfolio techniques.

You spend dramatically less than you would in a pure portfolio model since you don’t have the heavy cost of finishing and deploying the bulk of unsuccessful market explorations. All that waste can go back into either exploring new options or building out projects that show success.

You have a higher success rate than a purely iterative model since you are exploring multiple hills instead of climbing a single hill and hoping that it is the highest one around. This recognizes that not all successes are created equal and it can be easy to get stuck in rut serving a niche. By keeping your options open, you can always shift resources around if a truly great opportunity emerges.

One downside is that cost is a little higher than a pure iterative model. You need to devote a portion of your overall efforts to generating and exploring new opportunities. This is typically more than offset by the earlier access to successful products. Another downside is that some long term projects (such as say…a fusion reactor) are culled before they show their promise. This can be handled through careful tailoring of gates so that break through innovations are properly weighted.

The Harvest Process: Applying a stage-gate model to a single product
A single product can benefit greatly from the ideas in the stage gate model. A single product is composed of a variety of separate features, scenarios and audiences. We can treat each chunk of customer value as a separate project and bundle of high value projects as a product. The basic model is the same as the stage gate process outlined above. However instead of spinning off multiple products, your individual teams tend to be focused on critical workflows or user scenarios for a single product.



Returning to the garden metaphor, as you nurture these areas of value, you should always have projects that are ripe for release. Publishing can be as simple as creating a public release that turns off all the experimental projects, leaving only your best features to show the public. I think of this as harvesting a ripe crop for your favorite customers.

As time passes, the little ideas that you seeded earlier will mature and produce a new crop of high value features. The process just keeps repeating, season after season, release after release.

The cliché in our business is that ‘ideas are cheap’. The shame of the matter is that some of the best ideas are left to rot because they don’t come from the right people and the production schedule has no room for creative thinking. The Harvest process builds innovation in at the lowest level possible. Everyone is encourage to come up with ideas and there is a clear and official process by which those ideas can become reality.

Making it work
In order to pull this off you need some basics in place. There is a substantial expense to running multiple projects and constantly integrating their efforts. With the right people, the right process and the right values in place, it is a very achievable goal.

• Multiple, small agile teams: A single monolithic team has difficulty guiding a multitude of projects. Smaller teams can champion their area more easily.
  
• Highly refactored and regression tested modular code: You need to be able to change one element without breaking the rest of the projects.
• Innovation at the edges: Teams need to be able to innovate in interesting directions without constantly referring back to the ‘master planning committee’
• Kill gates: If you don’t understand success and kill projects that don’t meet the bar, you’ll end up with a cancerous mass of bizarre, unhealthy features that have grown in random directions. Quality kill gates that actually kill projects are critical to success.
• Shared design: You still need to present a unified face to the customer. Each team is under additional constraints to share visual styling and minimize conceptual complexity for the product as a whole. These constraints are built into the kill gates.
• Customer feedback: At every stage, you need to be testing your products with real customers. You should be able to quickly deploy a working product to your customers every day. None of these ideas can succeed without people using working versions of your software and the team being wiling and able to learn from the customers’ reactions.

Conclusion
In the end, any of the techniques outlined above have a chance of working. You need a driven group of people with the right circumstances in place. With the right amount of random luck and persistence, even a waterfall project can change the world. For some fat cats working in bloated large companies, this is enough. However, if failure has a personal cost, you’ll want to look into the alternative techniques such as agile, stage gate, or harvest. Over the long term you’ll notice less overall portfolio risk and your customers will start enjoying your superior, well informed product designs.

If you take away one thought today, it should be that learning is fundamental to software development. We do not live in a Newtonian world where huge mechanical brains can predict the future. Instead, we operate in a constantly shifting organic universe of cultural trends, customer urges, fluctuating cash flow and skeptical sponsors. In order to deliver great products on time, we need to learn from our environment and build a response rapidly and precisely. Portfolio technique increase learning by trying more options. Agile techniques increase learning by shortening the feedback cycle. Build both of these key concepts into your teams and you’ll find that they make smarter decisions and deliver more value to your customers.

Take care
Danc.


References and resources

Original pretty pictures
I was inspired by these image of agile development when I began making diagrams.
http://www.gamesfromwithin.com/articles/0608/000110.html

Small initial teams? Try 20% of one person.
With Harvest and Stage Gate, initial teams can be very small. For example, you could devote 20% of one person’s time for the initial concept stage. That doesn’t sound like much, but if you have every single person in the company devoting 20% of their time to new ideas, you’ll be seeding the equivalent of hundreds of new projects every year for no additional headcount. Google is the golden child of this concept right now, but 3M has been doing it successfully for decades.

Put those hundreds of ideas through a simple checklist that looks for potential customer value. Spin off the best ideas into tiny teams of a couple people and give them an iteration or two to come up with something cool (and testable.) Repeat the process several times and you rapidly gain some surprisingly innovative products .

Iterative techniques
Agile Overview: http://www.agilealliance.org/
Scrum: http://www.controlchaos.com/about/
Kaizen: http://en.wikipedia.org/wiki/Kaizen

Stage gate
Winning at New Products: Accelerating the process from idea to launch, 3rd edition Robert G. Cooper, copyright 2001

Project Horseshoe Report on building games that sell
Many of the ideas in this essay were heavily influenced by discussion inside the Play Dough group at Project Horseshoe 2006.
http://www.projecthorseshoe.com/ph06/ph06r5.htm

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"Content is Bad"

I just came across an article by the good folks at Introversion discussing procedural animation and its benefits versus hand crafted content. Some of my favorite games of all time are riddled with procedural content. The universes of Elite, the dungeons of NetHack, the random maps of Age of Wonders...all these are littered with procedural content. And how could I forget Dice Wars. Or Tetris. Or Poker.

The more handcrafted content you build, the more it costs. There are few economies of scale. Want a new level? Add a couple more monkey designers and artists to the team. Want a higher level of detail? Add some more team members. Procedural content has the benefit that despite an initial start up costs, you get immense amounts of content for little to no incremental cost. Procedural content also is inherently more agile friendly than handcrafted content. It can be refactored, unit tested and evolved in an iterative process that lets you try out new ideas quickly.


The problem with hand crafted throwaway content
If we look at content from a rewards perspective, you can classify content in games into two main buckets:

• Throwaway: This is content that the player sees once or twice and then proceeds to ignore every time they see it again. It has a very high burnout rate since the player immediately sucks any value from it, groks it and then filters it out as noise. In order to keep throwaway content exciting, teams produce large amounts of it and direct a steady stream of empty calories at the player. RPG's, Adventure games and many single player FPS have mastered this technique. Most plot points, level designs, conversations with towns folk, etc fall into the throwaway content category.
  
• Reusable: This is content that the player keeps coming back to again and again because it tends to be useful. A new character with abilities, a new weapon that has a unique effect on the environment, a store that lets you trade in resources are all examples of reusable content.
  

Handcrafted content is expensive in bulk, but it has another issue: it is incredibly difficult modify quickly. If you build a clown and then decide that a rapid zombie dog works later, you are forced to rework the models and animations completely from the ground up. You can lose month when you decide to alter your static content. Great game play comes about through rapid cycles of prototyping and playtesting. Visuals, settings and level design are feedback mechanisms like any other and need to be adjusted and iterated upon just as much as the algorithmic simulation underneath.

The more handcrafted, throwaway content that you have, the less agile your development process will be. This dramatically increases the chance that you will fail to converge upon enjoyable gameplay. It also dramatically increases the chance that you'll fall back on conservative game mechanics because the act of trying something new is too bloody expensive.

If you are on a budget, you should start identifying throwaway content and figuring out ways to remove it from your design. It may seem like a great idea to have a clown appear in a scripted scene where he describes his life story. However the incremental value to the customer is rarely worth the cost of production or the loss of project agility.

Using procedural content to replace throwaway content
There are two faces to procedural content. The first is as a hack for throwaway content. It allows you to cheaply replace large amounts handcrafted seemingly meaningful, but actually useless game content with algorithmically generated seemingly meaningful, but actually useless game content.

Ask yourself:

• Is this content critical to a working game mechanic? Identify the feedback that it gives the user and think about how it might provide them with utility. Sometimes you can cut content immediately from the game.
  
• After the user has seen this once, will they ever care about it again? This helps you understand if you are dealing with throwaway content or something meaningful to the player.
  
• If not, is there an inexpensive stylistic tweak that allows me to use a cheaper means of producing the content? If so, there are numerous possibilities here ranging from a less expensive art style, to procedural content, to player generated content. Pick the one that provides the player with the most utility, costs the least and leaves you in a position of greatest agility.
  

You'll find a lot of procedural content generation techniques that fit the bill. These are rarely up to par with the best hand crafted assets, but they will work in a pinch often at a much lower cost.

• Sound generation
  
• Texture generation
• Particle systems
• Procedural character animation
• Ambient animations

Using procedural content to augment reusable content
The second face of procedural content is where it is integral to a reusable game mechanic. In NetHack, the act of exploring the dungeons and coming across different configurations of monsters and items is crucial to the player's slow but steady unraveling of the immensely complex system underlying the game. Each level was somewhat disposable, but the map generation system was actually an intricately balanced algorithmic method of putting the player in unique initial conditions that helped maximize their learning of new skills.

In a card game, the randomness of shuffling the deck and dealing the players an interesting distribution of cards has a big impact on the gameplay that follows. You simply could not play the game without this element of algorithmic level design. Players would figure out the predictable set of hands and all challenge would be removed.

When dealing with reusable game mechanics, procedural content can replace handcrafted content in the following ways:

• Setting up interesting initial conditions, especially with configurations of existing game tokens.
  
• Introducing risk and uncertainty into game mechanics
  

Where procedural content fails
Procedural content is by no means a panacea.

• Procedural content is bad at setting goals: Dynamically generated quests were all the rage at one point. It turns out that people just zip through the text. Players quick discern the pattern and you are left with another high burnout game mechanic lying on the trash heap. Good goals are interesting because they are unique; they promise a brand new opportunity learn, advance or help out. They tend to play upon complex concepts of duty, heroism or desire. If you break down why 'Rescue Princess Peach' is meaningful, you'll have a tome on basic human psychology. These are areas where our algorithms are childishly primitive.
  
• Procedural content is bad at most social factors: In fact, you can generalize the concept to say that procedural concept is miserable at replacing most human aspects of content. Conversations, voice acting, descriptions of long lost cultures, plot, all these are difficult to replace. You can either cut them from your game, turn them into easily refactorable modules (like the descriptions in NetHack) or as a very last resort, use traditional, expensive handcrafted production techniques.
  
• Density: Developers sometimes react to the ability to generate infinite levels by building games that sport infinite levels. This is a very bad idea. When you are using a random map generator to put the player in interesting situations, the key operative word here is 'interesting'. All the standard rules of pacing, flow and burnout still apply. If your procedural content only amuses players for 15 minutes, make a 15 minute game. Otherwise start increasing the density of interesting interactions. No one wants to wander for hours through an infinite maze that has no purpose.
  
• Procedural content requires a programmer-designer or programmer-artist: This shouldn't be surprising, but you really need someone who is both a good programmer and a good game designer to make procedural content work. Someone who only programs or only draws seem to be a dime a dozen, but good programmers with design skills or art skills are rather rare. If you aren't such a magic person, so you need to form a team that has all the skills you need. Sit your designer and programmer next to one another and iterate like mad.
  

Ze sum uppery
The phrase "Content is Bad" is of course hyperbolic. To rephrase it, too much handcrafted throw away content is expensive and decreases the teams agility. Procedural content is one solution, but if there is anything I'd take away from this essay, it is the broader concept of creating agile, refactorable content.

If you are smart, your design will change dramatically over the course of development. You'll discover a hundred little tweaks that end up making your final game far better than the initial design. Always be on the lookout for content that you can refactor in some way so that you can change it more cheaply.

• Procedural content, when properly used, can turn the bulk of hand crafted content into code with all the added benefits of flexibility and cost reduction. You'll still have a bit left over in the form of variables and other compact data, but this will be much easier to manage.
  
• User created content (which is at least another essay or two) offloads handcrafted content to your users.
  
• If all else fails, at least modularize your content into tiny bite sized pieces that can be added or removed without derailing the ability to do frequent, completely playable builds.

Always maintain the ability to make a change to game play and test it with users within the next hour. If content becomes a barrier to this goal, you need to refactor your content-based systems. Be brutal in enforcing this rule, no matter how much you like that cutscene with the clown. It could save your team and your game.

The plague of handcrafted content is only going to get worse in the future. A friend mentioned that a level in his previous game took 2 days to assemble. Now, with the advance in customer expectations, it takes their team two months to build a level. If it costs that much to build a level from scratch, think of the pain involved in propagating a substantial late game design change throughout a series of levels. I can't help but wonder what their production schedule might have looked like if instead they had adopted the philosophy that "Content is bad."

take care
Danc.

References

"Procedural technique is another name for tool."
Jason Booth has a wonderful essay that talk about how much of what we call procedural content is really just another name for tools. They leverage a small bit of creative content to create a lot of gameplay, but they still need to be used in a creative fashion. There is no magic 'make me a world button' and the folks that take this attitude tend to give the whole concept a bad name.
http://jbooth.blogspot.com/2007/02/procedural-content.html

A more comprehensive definition
http://en.wikipedia.org/wiki/Procedural_generation

Introversion discusses procedural generation
The originators of the phase "Content. Is. Bad." They should make a t-shirt with that phase on the back and my favorite character design of all time on the front: "@"
http://www.gamecareerguide.com/features/336/procedural_content_.php?page=1

NetHack
One of the grand daddies of procedural content done well.
http://www.nethack.org/

Desert Bus
A game by Penn and Teller that illustrates the problem of gameplay density quite succinctly.
http://en.wikipedia.org/wiki/Penn_&_Teller's_Smoke_and_Mirrors

Thought experiment: Tiles as an early form of procedural content
"But most games that use procedural content suck" I recommend folks look at games like Zelda or Mario Brothers. Tiles were a huge innovation that allowed the developer to convey complex concepts (like walls, doors, tapestries, rocks, etc) without drawing ever single scene by hand. Instead you create a few modular pieces and then arrange the initial conditions of those pieces in an interesting way. You only use a small core of handcrafted seed data to build some truly enormous worlds.

This may seem like 'not true procedural generation', but compare it to the other popular alternative of the day: Drawing out every screen by hand. The genre that relied upon this technique, graphic adventures, was pushed into niche status. It simply could not compete economically with the richly interactive environments and economic efficiency of procedural techniques like tile-based environments. Food for thought.
http://www.tonypa.pri.ee/tbw/tut00.html

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Project Horseshoe Report: Building Innovative Games that Sell

The 2006 Project Horseshoe reports are out! In the place of my irregularly scheduled essay, I'd like to point you toward the collaborative report that I've been working on with our appropriately named "PlayDough." We dug deeply into the issues around funding innovative games and ended up producing 18 pages of revolutionary white paper goodness.

Click here to read the report. Now for a bit of commentary on the topic of innovation and business.

We are bad at designing profitable games


If you've read this site for some time, you'll notice that I keep returning to the themes of measuring success and rapid feedback cycles so that you can make necessary changes early. Unfortunately, it became very clear that most players in the game industry do not apply these lessons to the business of designing games. It isn't purely a publisher issue, nor is it purely a developer issue, but the overall issues are rather clear:

• We don't know what makes a successful game.
  
• We don't measure our games regularly from the customer perspective to see if we are going down a successful path.
  
• We don't act on information that our projects will be market failures.
  

A Solution
You might expect a good deal of venting at one of these designer retreats, but everyone was far more interested in fixing the problem. The game industry isn't the first to run into these issues and the solutions we found used in other industries are surprising palatable. Our group ended up exploring the adaptation of the Stage Gate new product development process to game develpment.


Stage Gate is a well known options-based portfolio management technique that focuses on improving product launch success rates. It is particular appealing to the game industry because it allows companies to try out lots of different ideas ranging from highly innovative project to product line extensions and then guide the most successful ones toward a market launch. Hundreds of companies in other industries use this model and it has been proven time and time again to dramatically improve success rates, reduce design and execution risk and also reduce time to market. These are all good things. :-)

Low hanging fruit
My basic belief is that innovative products are a highly desirable and profitable component of any publisher's portfolio. However, in order to make this obvious to all the egos involved, you need a process that provides hard data and a way to mitigate risk/fear. The Stage Gate process does this with surprising efficiency.

It is also obvious that a competitive market eventually punishes stupidity. Ignoring new markets while releasing products with a poor chance of success only works until someone figures out that there are better ways. The first party story has some obvious suspects and I know at least one forward thinking 3rd party publisher has already started rolling a version of the stage gate process out across their teams. It will be fascinating to watch the techniques we talk about in the paper inevitably take hold over the next decade.

If you work in any organization that deals with multiple retail game titles, you are likely to save millions of dollars by taking the lessons of this report to heart. Perhaps that is a big claim, but one that is well justified by the historical results from other industries. The opportunity to become the savior hero in your organization is immense.

Kudos go out to everyone in the PlayDough group. We had the perspectives of independents, studio presidents, and publishers represented. Everyone is looking for solutions and everyone who worked on the report feels quite hopeful about the future. It is a wonderful thing to be able to point to business best practices that hold the promise of dramatically improving the industry as a whole.

take care
Danc.

• Read the PlayDough report online here: http://www.projecthorseshoe.com/ph06/ph06r5.htm
• Download the PDF of the report:
  Project Horseshoe Report - Building Innovative Games That Sell.pdf
  
• Read all the Project Horseshoe 2006 reports: http://www.projecthorseshoe.com/reports.htm
  

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Bursty Indie Sales Cycles

I had a delightful lunch today with Amanda F. and her handsome, watch loving friend. She is the driving force behind the new indie RPG Aveyond and I’m very much looking forward to seeing what she does next. Most of my contacts with the game industry go back to the old PC shareware glory days, so it is quite enjoyable to connect with one of the rising stars of the new generation of entrepreneurial game developers.

Out of the many topics we meandered through, one jewel was the bursty nature of shareware game traffic. She’s been noticing a trend. Whenever her game hits a new portal, there is a rise in traffic across all portals that the game is featured, even her website. Portals where her game has long fallen off the chart suddenly start featuring her title again.

There are two potential reasons here:

• Repeat impressions are needed before customers take action.
  
• The downloadable market is highly fragmented.

Repeat impressions matter
People don’t look at a game and think “hey, I’ll try it out.” The first time, they become aware of the title, they might be about to wash their laundry or perhaps they are at work. Maybe they aren't in the mood to check out games. (Shocking!) The moment passes and the title that has consumed a year or more of your life passes out of their heads without a second thought.

Getting people to download your game is a lot like playing one of those maddening quarter games at the arcade. The machines taunt you with dozens of quarter balancing precariously on the edge of a small ledge. All you have to do is place in a single quarter and you’ll push an avalanche of coins over the edge.

But imagine that you start with an empty machine and each quarter is actually a mention of your game. You need to build up quite a few impressions of your game within a potential buyer’s head before the cascade of impressions overflows into action.

When a title hits a new portal, there is a buzz of word of mouth around it. This leads to lots of people getting fresh impressions of your title. Only a few are saturated with enough of your message “Hey, this is a cool game” to actually take the extraordinary effort to search the internet and download it. This leads to more word of mouth and more downloads. Thus the single media event leads to a burst of sales across multiple distribution sources.

Market fragmentation
The fact that the downloadable and casual games market is fragmented isn’t really news, but it too informs your sales patterns. Think of the new shareware market being composed of dozens (if not hundreds) of population pockets. Each group might be built around a single portal or a special interest group.

They don’t talk to one another much, nor do they read common news sources. Many don’t consider themselves mainstream gamers. I like to think of them as the oil shale of the gaming market: A bit difficult to reach in larger numbers, but still highly valuable customers if you can figure out the techniques.

The result is that long term promotion will often have incremental payoff even with products that a no longer ‘hot’. There will almost always exists large populations of players that will have never heard of your game. Don’t be surprised if you end up getting letters years after your initial launch that exclaim “I had no idea that this [insert superlative] game existed!”

Often someone who just heard about your game may introduce it to new markets. Within a short period of time, the number of people who become aware of your game can increase dramatically. This also contributes to and magnifies the bursty nature of sales.

You must pop little markets one at a time over a long period of time before the total number of customers that might buy your game is tapped out. Indie games are in many ways closer to evergreen products than your typical launch and dispose commercial titles. Think about it. Bejeweled is still selling to this day and it is doubtful that the majority of those customers are repeat buyers.

Marketing is a long term effort
There is the dark side to all this as well. If your game doesn’t trigger a big enough burst of word of mouth, you may see a small spike that fades away rapidly. Quite likely your awareness raising event isn’t large enough to ignite a chain reaction across all the sparsely connected social nodes. Alternatively your game isn’t good enough to inspire strong word of mouth. Or maybe you are popping smaller markets and not reaching the bigger ones.

I think of the system as the following (completely unscientific) equation:

• [# of promotional events]
  
• * [Average reach of promotional events]
  
• * [Word-of-mouth worthiness of your title]
  
• * [Average number of existing impressions]
  
• * [Number of new markets that you breach]
  
• * [Average size of each mini-market]
  
• - Percentage of market already reached.
  
• - Percentage of people who just don't give a damn.
  
• = Magnitude of each PR burst.

You’ll likely have to promote your game for longer than expected. Don’t give up on an older title just because it is no longer the latest thing. Re-releases, targeting radically different audiences with an existing products, as well as shameless and consistent broad-based self promotion are all valid and useful techniques for getting your games out in the public eye.

Here is to a long and bursty sales cycle,
Danc.

Links and such
Aveyond
http://www.amaranthia.com/modules/tinycontent/index.php?id=14

A description of that darned quarter game
http://wizardofodds.com/flipit

Read more!

Playground game design as a sustainable competitive advantage

There exists a perplexing multi-billion dollar mystery sitting in plain sight of everyone who works in the game industry. Some of the top franchises such as GTA or Sims do not experience the same competitive pressures as do other titles in popular genres. Also unexpected is that the companies that originally innovated with the creation of a new genre end up dominating. Something beyond your typical branding and IP ownership acts as a barrier to entry for new companies looking to cash in on popular new genres.


The urge to exploit these obviously successful genres seems impossible to ignore.

• Open ended dollhouse genre opportunity: The Sims has sold over a billion USD of product (24 million copies including expansions) since its introduction.
  
  The Competition: A mere half dozen failed attempts such as Singles or Playboy Mansion.
  
  
• Open ended driving genre opportunity: The last three versions of GTA have sold over 38.44 million copies, placing them amongst the most successful franchises of all time.
  
  The Competition: Around a dozen urban themed driving titles, most of which miss the entire point of the GTA design by removing the open ended gameplay and implementing linear levels. Most started development only in the last couple of years. There is an intriguing lag of years after the signals of market success for the genre hit the development community.
  

Compare this pattern to the RTS rush that happened a few years after Dune 2 was released. At one point, I remember counting over 60 different announced RTS titles. The same genre rush has happened with FPS, Match-3, Vertically Scrolling Shooters, Graphic Adventures, and most new successful genres throughout the history of the game development.

What prevents the typical genre gold rush from flooding the market with profit sapping competitors to the Sims or GTA?

Playground games
One of the few common elements that titles like GTA, Sims, or Oblivion sport is open ended gameplay where the player explores a large, complex playground and meanders about from non-linear adventure to non-linear adventure. The concept goes back to a couple of decades to early titles such as Elite, Nethack and Paradroid. Each of these titles focuses strongly on dynamic emergent gameplay over heavily scripted lineary experiences.

Such playground games are bloody difficult to build. They balance complex emergent gameplay systems that, by definition and design, lob crazy surprises at the development team all throughout development. With enhanced player freedom, there arises an inevitable stream of exploits, bugs and worst of all unbalanced boring game play.

The flip side is that playground offer unexpected competitive insulation from the typical cloning efforts of other development teams. A good playground game has a magic mix of gameplay that is both difficult to get right in first place and difficult to duplicate. The recent spate of high budget attempts on GTA may replicate the urban setting and adds better graphics and more explicit violence. But none of them capture the gameplay magic.

A unique sustainable competitive advantage
This unexpected quirk of playground games is a potential pot of gold. It turns out that any difficult to replicate process that yields a valuable product can be used to help make us more money. It opens up the possibility of milking new games longer without the threat of competition.

Any venture capitalist and most entrepreneurs are familiar with the concept of a ‘unique, sustainable competitive advantage.” Traditional economics teaches us that most highly profitable new products are converted into low profit commodities through competitive pressure.

• A company releases a new product that meets a hitherto underserved market need.
• The first mover, recognizing that they offer a unique product, charges a premium above and beyond their production costs. In situations where demand outstrips supply, the customers happily pay what my economics professor termed “greedy pig profits.”
  
• Other companies recognize the sweet scent of profits so they duplicate the original product, add some of their own mild innovations, and typical offers a competing product at a lower price or with a bigger marketing budget.
  
• The original company responds in turn, which naturally costs money. There is a bit less profit margin for everyone at this point.
  
• After several cycles of increasing competition, you end up with a mature market in which each company is spending almost all their profits on marketing, distribution, and product improvements. The era of the greedy pig profit is at an end.

There are quite a few other potential endings to this classic tale. The one you most typically see in the game industry is one where the original company is often bankrupt, purchased or marginalized. A few bigger companies that can leverage economies of scale or market dominance take control of the new market and release a steady stream of moderately profitable products. They erect substantial barriers to entry in terms of licenses, strong branding, or high costs of entry.

Anyone looking at a new business (and most new game projects are new business projects) understands these dynamics. They know that a great new innovative product you make today will likely be cloned, rebranded and controlled by the competition tomorrow.

So as educated business owners, we must ask the dreaded question “What is our unique sustainable competitive advantage?” In essence, we need to figure out how we are going to break the inevitable capitalist cycle that drives those lovely greedy pig profits out of our business. What barriers to entry can you put into place now that buy you time to rake in more money for a longer period of time?

I suggest that complex emergent game mechanics are one mechanism that acts as a sustainable competitive advantage for new games. We've all been trained to appreciate typical stalwart strategies such as brand building and licensing. A title's game design, oddly enough, is rarely seen as a key business decision. It is one of those artistic details where ephemeral 'quality' matters, but has little impact on the bottom line. What if picking the right class of game mechanics could result in the creation of defensible franchise that profited your company with profits for decades?

The naive look at the roll of game design in business
Many game developers imagine that inventing a great new game is enough. However, with most modern game designs, the core game mechanics can be duplicated relatively easily. There are fewer moving parts and their impact on the overall gameplay is clearly defined. Once there is a proven working example of the game design, the barriers to entry are quite low. Within a couple of years, consumers witness dozens of clones clogging the market. This is known as the "genre gold rush."

In a market where prototypes are often more effective than design documents, releasing a typical game is like hand delivering a blueprint of your entire company’s formula for success to the doorsteps of your competitors.

• Blizzard stole the RTS crown from Westwood (who is now dead as an independent company)
• Everquest stole the US MMORPG crown from the UO team (and Blizzard in turn stole the crown again with WoW.) The original UO team is now marginalized.
• The various Sly, Ratchet and Jax titles now own the 3D platformer genre. Nintendo, with their original Mario 64 franchise, is rarely seen. This ‘innovate and move on in the face of competition’ is arguably a successful business strategy for Nintendo, but it still leaves a remarkable amount of profit on the table for competitors.

Wouldn’t it be nice to cut this cycle off at the knees? As a game developer, you ideally want to create a new genre and milk it for the next ten years without the threat of outside competition.

How emergent gameplay results in a sustainable competitive advantage?
This is exactly what has happened with GTA, the Sims, Oblivion and small number of other titles. By investing in a complex sandbox gameplay system, they’ve created a strong barrier to entry. Typical game development companies that thrive on cloning the works of others can’t get their heads around the formula. The reasons why the barriers are so strong is a fascinating lesson in the failings of traditional game design techniques.

Every post mortem that I’ve seen for titles with strong emergent gameplay in an open ended playground like environment discusses the long, convoluted development process. The Sims languished for years as Will Wrights personal project and originally was going to be an architecture simulator. GTA at one point didn’t have cars and involved killing zombies. NetHack has been in development for decades with the community adding quirky mechanics in a haphazard fashion to the system.

Some common themes include

• Use of iterative design to polish and improve as the design goes
• Openess to big design changes well after the typical preproduction stage.
• Layering multiple unique gameplay systems on top of one another to form a complex choice space for the player to explore
• Long development cycles that encourage the ‘ripening’ of new game design concepts.

These successful best practices also introduce the following entry barriers to traditional ‘clone and polish’ companies:

• Design risk: The existence of so many different systems interacting in intricate ways means that simply cloning the mechanics exactly rarely results the same emergent behavior. There is an element of the butterfly effect involved. A minor difference in the city generation algorithm combined with a small change in car handling physics and certain types of jumps and stunts become highly unlikely. So the chances of your title containing identical moments of ‘fun’ as the original are highly unlikely.
  
• Process and Team barriers: Initial versions of playground games are almost always developed using highly iterative, prototype focused processes. Many teams do a small amount of prototyping early on their development, but they are not set up or trained to manage an iterative process over the entire length of the project. Teams trained on “Plan and then Execute on a Production Line” often fail to have the personalities or experience to successful carry out an extended “Prototype, Riff, Critique, Expand” process.
  
• Risk adverse publishers: Iterative design is messy and highly frightening to most risk adverse publishers. The metrics used in the industry today are such that when a project with highly emergent gameplay is meandering towards a destination, it is very likely to be cut. No one likes hearing about major game changes months before release, but that is how these emergent game systems evolve. “Oh, btw. We added a new driving system.” The publisher will inevitably ask “Why can’t you add three more levels exactly like the existing ones, render a great box shot and just ship it?” If the standard formula doesn’t work, then the game must be a bad egg.

It is a rather vicious cycle. Companies that look at cloning a popular genre tend to use risk adverse best practices like data driven development. Their goal is to reduce risk through upfront planning and detailed execution of the plan. These techniques are the opposite of what you need to build a new playground game. In iterative development, you are constantly learning from the emerging gameplay as it evolves on a daily basis. You tweak, evolve, build a little more until you have an enjoyable organic experience.

However, when the team judges the progress of a game based on how well it sticks to the production plan, they are often blind to finding and nurturing the magic moments that make a playground game function. The title almost inevitably suffers from an unexpected case of ‘crappiness.’ With the release at risk, a crack down by upper management ensues, often involving more detailed planning. These are ‘sane, reasonable’ best practices smother the processes necessary to create and balance a playground game. By trying to reduce risk, they actually increase their risk of market failure.

Benefits entry barriers
Not having competition from the clone-meisters of the world has strong benefits for a company.

• Time at the top: Obviously having a successful title that people love allows you to release a sequel. Without competition, that sequel is very likely to be a genre king. All the press, word of mouth and pent up demand from previous players translates into a much larger swell of people purchasing the newest top title in the genre. If you have the only option, you reap the benefits. Having a third or fourth uncontested genre king in a row results in major cash in your bank account.
  
• Brand: Without competition, you have lots of time to establish your brand. The first Elder Scrolls title was a mild PC success, but nothing to write home about. Over the past decade, they’ve managed to build a substantial brand following that will be quite hard for others to erode with competitive products. If Oblivion II and an exact clone of Oblivion II were released simultaneously, Oblivion would blow away the competitor in terms of sales. At this point, the brand has established market power.
  
• Team empowerment: Since the team dynamics are so important to the success of the franchise, playground teams generally are given great creative freedom by the publishers. Such teams are literally golden gooses that make or break the bottom line of those that are lucky enough to have them in their development stable. Designing what you want, when you want is not such a bad thing.

Problems with creating playground games
All this sounds great, but there are some more big reasons why more people aren’t making playground games. The obvious ones involve the same barriers to entry the stymie the clone makers. However, even when you are doing iterative development there is a high risk of failure. I’m reminded of Frontier, one of the sequels to the great playground title Elite. This was a game that had a lot of things going for it: brand, original developers, and proven concept. But it ended up suffering horribly in the market for a variety of reasons.

• Bugs: Complex systems introduce crazy amounts of bugs. Stability is often an issue unless you architect the system to deal with rapid design changes.
  
• Indeterminate development cycles: It is often difficult to know when to stop. There is always something new to add so development could literally go on for years. Reducing scope and remaining open to change is a hard balancing act for many teams.
  
• Team dynamics: More than any other type of game, who is on the team matters. If your team doesn’t gel, the open opinion rich work environment will result in destructive conflict, not creativity.

The result is that many playground games fail. Very few have the resources or the right people on board to wade through the difficult times that inevitably crop up. Each one is a unique creative adventure that is just as likely to be stoned by an unexpected cockatrice as it to produce the Amulet of Yendor.

Conclusion
We live in a turbulent industry where developers move from team to team and project to project at an alarming rate. Stability lasts as long as your teams signed titles development and then all bets are off. As developers, we generally do not understand how to carve out a sustainable niche in the marketplace and build a lasting company around that niche.

Yet, companies are doing just this. They’ve built their own sustainable niches by inventing new genres that are easy to defend against competition. Bethesda, after many years of hard work, has a franchise that will feed them for many years to come. The old DMA, albeit much changed from those early days, still has years of GTA left in them. Will Wright, a quirky guy building quirky games, is in the position to infect much of EA with some of his iterative prototyping methodologies. He has shown the world’s biggest publish how to build a competitive advantage that was based off game design, not licensing and branding.

If there is one take away from this article, it is that building playground games is a sound business strategy. Building playground games is not easy and very often, you will fail. You need to build your teams around iterative design. You need the right people on board and the long runway necessary to ripen your title. Spending a decade honing a single concept is not uncommon. However, if you get everything right, you will have created a long lived, stable source of greedy pig profits.

There is the bigger picture here as well. If you pull it off, you've generated stable employment for your team. They don’t have to move across the country every couple of years to take up a new title. They don’t have to pull their kids out of school or take a job that isn’t what they love in order to avoid selling the house. Your team gains a small amount of freedom from the rat race.

This is a good goal and there are admittedly lots of ways to reach it. Playground games are one more sustainable competitive advantage to keep in your quiver. They can help you do what you love and still have a good life doing it.

Take care
Danc.


Appendix A: Lessons from Grand Theft Auto
Here are some quick notes I jotted down after looking through the post mortem that Edge did on GTA. Here are a few lessons that can be gleaned from Grand Theft Auto. I've witnessed many of these personally and also seen the same patterns pop up in other playground game post mortems.

• Sticking with the playground concept
  
• Slack: Time to experiment
  
• Permission to experiment
  
• Collaborative
  
• Iterative game design
  
• Willingness to trash the setting

Sticking with the playground concept
“They wanted something more convincing, more immersive. ‘Living’ environments seemed to be the answer”

The big concept driving GTA was to build a ‘living city’. The further they went down the path of development, the more this playground metaphor became the driving theme of the title. Instead of reducing the experience to a series of canned levels, they opened the world up to an entire city and made the mission optional.

If you are making a playground game, don’t give up on the concept because it is difficult and risky. You toss your competitive advantage out the door the moment someone says “Maybe we should split the game up into easy-to-manage linear levels.”

Slack time
“But, fortunately, Dailly had been working on another, unrelated idea.”

There are two types of risk. The first is execution risk, which is the risk that a project will not be completed. The second is design risk, which is the risk that you’ll complete the wrong project. Most companies focus on reducing execution risk by having tight schedules and detailed planning. Unfortunately, this is often like driving a fast car in the wrong direction.

Design risk requires the time to generate new, potentially better ideas. If you are driving your team 80 hours a week to check off the 2045 little items on the Gant chart, they will never have the time to come up with something better. It just won’t happen.

They need slack time to play and come up with their own ideas.

Permission to experiment
“If we’d stuck to the original design, GTA would have flopped.”

The other aspect of design risk is an openness to incorporating new ideas into the product.

If you don’t have the ability add new stuff to the project, the team’s creative spring will dry up and the design risk for the product will shoot through the roof. In GTA’s situation, not only was the team onboard, but the producer was comfortable with the experimentation as well. The team was given another 12 months to get the title right.

Collaborative design
“The one thing that everyone agrees on is that they didn’t make Grand Theft Auto, but that’s not strictly fair: the other thing that everyone agrees on is that everybody made Grand Theft Auto.”

Often, a purely production oriented studio will rely on a command and control style management structure with strong role boundaries in place to prevent any disruptive discourse. Suggestions are required to go through proper channels with titles such as ‘Lead Designer’ or ‘Producer’ acting as strong gatekeepers that prevent most ideas from making it into the project. By ensuring that individuals own decisions, you guarantee that there is someone to blame if things get out of hand.

You end up with a carefully structured dance of petitioning the higher powers in order to ensure that a feature makes its way into the development pipeline. The nobility of the team that best plays the political games has the most say in the creative process. Most of the effort goes into navigating the system or complaining about the system instead of thinking up new ideas. In order to reduce distractions, many managers inadvertently implement rules that disable the creative engine of the team.

An alternative is the use of small teams that openly share ideas and are jointly responsible for making sound decisions. The team takes ideas from any source and builds upon them to reach a superior solution. To keep the creative engine burning hotly, everyone must be able to contribute to the design.

“I sat through heated design meetings, which resulted in tears. Screaming, punches and arguments were common.”

When you are practicing collaborative game design, a passionate team must figure out processes for embracing and dealing with substantial ambiguity. Successful team strategies for dealing with conflict will often result in confrontations and arguments. Ideally, you get passionate conflict that causes people to think through, question and defend their ideas.

There is no one answer to dealing with this inevitable conflict. Each team ends up setting its own norms and the teams that gel successfully are another difficult-to-replicate competitive advantage.

Iterative game design
“One of the programmers came up with a routine that had pedestrians following each other. This led to the idea of a line of Krishnas following each other down the street and then, once we had all experimented with ploughing through them all in one go, the Gouranga bonus became an obvious addition.”

The core of the design process for GTA involved an iterative prototyping cycle

• Try out an interesting idea
  
• Ask “Are there any interesting situations that the player finds themselves in?”
  
• Build reward system around the interesting situations. Expand promising systems to allow the player to experiment in those areas further.

Again, this is quite different from the typical design bible that drives most production oriented companies. The team explores, prunes and expands upon the gameplay space instead of following a rigid production schedule.

Willingness to trash the setting
“Many ideas and approaches were bandied about, some quite different to the final game”

Often games are pitched with a particular setting such as a “Vampire action game.” Changing the setting requires big changes to the design document, the plot and the art resources. By risk adverse publishers this is typically considered a Very Bad Thing.

One of the fascinating things that happens with iterative design is that the setting changes as you go. GTA switched settings from being a gang warfare title to a zombie game to a car jacking convict game. As you try out new mechanics, they map onto different settings. Since the focus is on polishing the game mechanics, setting takes a back seat. As your game mechanics evolve throughout the game, so does the setting. The results are often unexpected and quite delightful.


References
The Making of Grand Theft Auto
http://www.edge-online.co.uk/archives/2006/06/the_making_of_g_1.php

Playground worlds
http://onlyagame.typepad.com/only_a_game/2006/06/early_playgroun.html

Game sales
http://en.wikipedia.org/wiki/Computer_and_video_games_that_have_been_considered_the_greatest_ever

Definition of the term ‘genre’
I refer to game genre as a group of games having similar game mechanics. Unlike movies or books, two games in the same genre can have completely disparate settings but still share the same mechanics. For example, Starcraft and Warcraft both use RTS game mechanics and therefore in the same RTS genre, despite one having a fantasy setting and the other having a science fiction setting.

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Who knew Pikachu was so big?

We were looking through photos from last summer and I came across this lovely image. It was one of those photo opportunities I couldn't resist. I'm rather curious what percentage of revenue comes from the games and what percentage come from the merchandizing offshoots.

For a good overview of the Pokemon brand management and product introduction issues, I highly recommend this case study:
http://w3.salemstate.edu/~poehlkers/Emerson/Pokemon.html

take care
Danc.

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Never innovate halfway

Double Fine’s Psychonauts was an original game that by all indications did poorly in the marketplace. This has led to the odd comments from fence sitters (and misinformed publishers) that innovation is a failed strategy. Bad monkeys! Bad!


We often talk about “innovation” in product development as if it were a miraculous substance that always benefits a game. I also imagine a scene in an idyllic game development kitchen with a game designer wearing a chef hat. “This title needs a dash more innovation!” he cries and the sous chef scurries off to the back room to see if they have any left.

If only it were this simple. First, realize that there are different types of innovation and not all types are equally beneficial. There are many places we can start on this topic, but we should first start with the classics. Back in 1991, researchers Cooper and Kienschmidt wrote a paper that discusses classes of innovation and their impact on market adoption. The studies looked at the market success of three category of products

• Low innovativeness products: Modifications to existing product lines
  
• Moderately innovative products: Product line extensions
  
• Highly innovative products: New to the world products.

Each category was measured on three factors:

• Success rate: What percentage of new products broke even?
  
• ROI: What was the average profitability of the products that broke even?
  
• Market Share: What percentage of customer in the markets adopted the product?

By looking at the patterns that occur across many industries, we can gain insight into how to build successful innovative games in our industry.

Interpreting this data in the game world
Let's map this general product model onto the specifics of the current game market.

• Low innovativeness products: Sequels or expansion packs
  
• Moderately innovative products: Games that attempt to blend genres or establish new brands in established genres.
  
• Highly innovative products: Games that attempt to create new genres

The results
The results of the study are fascinating. Common wisdom would suggest that as the product became more innovative, the success rate would drop off. After all innovation is directly correlated with risk, right?


Instead, the data shows a U-shaped curve instead of a downward slope. Highly innovative products are actually mildly more successful than their low innovation counterparts. Moderately innovative products on the other hand do the worst out of any of the categories. This pattern repeats itself in the other areas.

Less surprisingly, ROI is strongest for low innovativeness products and quite reasonable for highly innovative products. It is again miserable for moderate innovation products. Market share is also low for moderate innovation products.

The immediate lesson is that both low innovation and high innovation products can do quite well. If you end up in the middle, however you are in big trouble. Let's dig into the strange U-shaped curve in more detail.

Explaining the U-shape
There are lots of reasons why sequels and direct expansions are successful. Several include

• Lower R&D risks. The game mechanics in a sequel are well-defined and can be reused. Generally, game sequels add more content and mild technological innovation. These are both well understood production areas that can be budgeted for and scoped appropriately.


• Built-in au