Why democratising monetisation is set to change how we consume and create video games 

With many years of experience in the traditional finance industry, Simon Cowell is CEO and co-founder of ZEBEDEE, a payment platform for virtual worlds. Previously he was head of corporate development at Bitstamp, the world’s longest-standing Bitcoin exchange.

When I was a teenager, my favourite game was Age of Empires. I would spend my summers hiding from the sunlight building powerful economies and winning heroic victories in battle. But as soon as I stepped away from the PC I had absolutely nothing to show for my work and time invested. 

Since then, video games have become a more meaningful part of our lives than just paid entertainment, but because of the way existing in-game payment solutions work in them, I believe they are currently limited . The legacy walled gardens of the payments industry are holding back innovation and growth in the video game ecosystem. By introducing money that is open, programmable software, not only will more stakeholders (whether players or developers small and large), be able to benefit, but the industry itself could grow. Let me explain.

Simon Cowell, Zebedee

The analogy here is Stripe, an online payment platform for internet businesses. Even by 2007, it was still difficult for small businesses and entrepreneurs to deal with the paperwork, costs and red tape to receive payments using legacy banking infrastructure. Stripe replaced this complexity with a few simple APIs, enabling anyone to quickly and easily set up their own shop and receive payments. The result – an explosion in ecommerce businesses.

In the same way Stripe democratised online payments and reshaped the digital economy. I believe video game economies are ripe for a similar revolution of democratisation. Over the past year  a global community of players and indie developers has sprung up, experimenting with this concept by integrating Bitcoin payment infrastructure directly into their games. There is even a regular tournament series of Bitcoin-integrated games called Mintgox.

Earning as an incentive mechanism

For example, Mandelduck Studios and THNDR Games have been creating mobile games which incentivise users to earn as they play. The incentive for players is clear, but for developers the model also generates a positive ROI as a cost effective way for boosting user acquisition, retention and engagement. Their download numbers also speak volumes as to their current success with players. 

“Skin in the game” to make FPS games more engaging

Bitcoin Bounty Hunt by Donner Labs does exactly what it says on the tin. In this online deathmatch FPS, players must kill each other for the Bitcoin Bounty on each other’s heads, with the ability to withdraw earnings at the end of the match.

My own company ZEBEDEE has created a plug-in to operate CS:GO servers with Bitcoin. Players pay a small amount of Bitcoin (ranging from 100-10,000 satoshis) to enter a deathmatch and at the end can withdraw their share of the prize pool based on their % of the total game score. By the end of March we will have servers pre-funded by corporate sponsors, removing the need to pay to enter.

Breaking the 4th wall

With programmable money, you can have payments not only between games and players, but also between anyone watching or streaming the games. Players can send small Bitcoin payments into a game, tip a player or streamer, drop power- ups or weapons, or spark randomized events. This not only creates higher engagement but also new monetisation models. I recommend checking out Bitcoin Rally to see this in action.

These examples are just the beginning. The key here is the freedom for all stakeholders in the video game industry to be entrepreneurial, to devise their own monetisation models instead of being constrained by the models derived from legacy banking infrastructure. This will also allow players to be freed from current monetisation models in the games they play now, to games where they can be rewarded for playing with more than in-game content. The only limit is the imagination of our community for both players and developers alike.

 

About Seth Barton

Seth Barton is the editor of MCV – which covers every aspect of the industry: development, publishing, marketing and much more. Before that Seth toiled in games retail at Electronics Boutique, studied film at university, published console and PC games for the BBC, and spent many years working in tech journalism. Living in South East London, he divides his little free time between board games, video games, beer and family. You can find him tweeting @sethbarton1.

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