INTERVIEW: John Schappert, Zynga

Zynga, the defining force in the free and social games boom, says that it is stealing a march on the traditional core and console games market. And its COO, John Schappert, should know – he was once a prominent exec at both Electronic Arts and Xbox Live. MCV quizzed him about the changes ahead for how games are sold games…

What attracted you to move from an established company like EA to an upstart that has only been in business for a few years?

It’s where I saw gaming going. When I was at Electronic Arts I worked very closely with the group that had casual and social and saw the explosive growth that was happening in that area. Mobile went from feature phones to paid downloads to free in a very short window of time. It’s going from a couple of hundred million gamers to everyone being a gamer, literally billions of people.

Zynga’s not alone in this space, though. Many of those established firms are moving in. What do you make of their efforts?

Zynga started its life in tomorrow. We began by thinking about mobile and social and how we connect the world through games. We didn’t have the past nipping at our heels. We don’t wake up everyday and say ‘what’s the newest platform we have to support?’, ‘how much is our product?’ or ‘what about this retail programme or this retailer?’.

We don’t have to worry about any of that. Zynga started by saying: ‘Look, our proposition is social, accessible and free.’

The traditional retail market has had a tough year. As someone who moved from serving that market to online games, what’s your take on that situation?

What we’ve been seeing for years is that people have been buying fewer retail games and playing them longer. In the traditional console and PC gaming space, these are blockbuster games that take years to make, they take massive teams and massive budgets and you have to hope the bet you started three years ago plays out.

If it doesn’t, it’s a game changer for you and not in a good way. If you capture that lightning in a bottle, like Activision with Call of Duty and Blizzard with World of Warcraft, it’s a magical thing.

I think that’s a really, really tough business. Is there still a market for it? Absolutely. Did movie theatres die away when television came? No. But what do we watch more of?

Zynga is more of the television type – it doesn’t take us years to make our games. We can make them relatively quickly – we’d like to be quicker than we are at times in fact – and we can get that out there quickly. If it does well, great, we can pour more fuel on the fire. We can dedicate more teams to it.

I think we’ve captured that TV-style magic which is why I think the social gaming world and the mobile gaming business is doing pretty well these days.

You are someone who used to step on stage at E3 to host huge presentations. Do you miss that world at all?

I still enjoy those company’s games and I still have many friends at EA and Microsoft – they’re great people. Xbox is a great console and I still have a lot of friends in that space. I love gaming and I love the big blockbuster titles just like I enjoy the casual and mobile titles. They make great masterpieces and I look forward to playing them.

What’s kind of exciting is when you work in gaming, and I’ve spent my entire career in gaming, you want to make games that everyone can play. The larger the install base of the consoles and the PC, the more your game can be played by everyone. When you look at what our mantra is, which is connect the world through games, one day we’d like to have a billion people playing.

We’ve had 240 million monthly active users now, that’s a quarter of a billion, but can we get to a billion? That’s what we’re asking. When 54 million people in a day play your games – something like eight million played CityVille today, or nine million played it yesterday. Those are big numbers and the industry has never seen this scale before because they have always been limited by, ‘gotta buy the hardware’, ‘gotta buy the software’, ‘gotta go to retail’, there’s all of these barriers that the industry has been living in. Social gaming and mobile has broken the mould.

Do you think the struggle of retail is connected to the rise of social?

I think they are related but they are somewhat different.

I think what’s happened is that as gaming machines have become more advanced, ironically they have arguably become more hardcore.

When you think back to the Atari 2600 or the Spectrum, they were much simpler. The games themselves were much simpler. Pac-Man didn’t have a button except to start the game. There’s a bit of a barrier to entry when you look at some of these high-def games, which is why we saw the Wii come out and take over the living room in a big way.

But traditional games have become more core. They require an expensive console, they’re not cheap to buy, they use a controller which core gamers can do magic with but some laymen would look at and be afraid of. Their interfaces when they start up are not always the easiest to use.

At the same time, there’s the time investment.

40-hour experiences, 100-hour experiences, or other crazy time costs where you sit down and think ‘gosh, I have to have two hours to start that game otherwise I can’t play now.’

That confluence mixed with the fact that smartphones and browsers can play pretty good games too is what’s helping bridge the shift.

I think a lot of people said, ‘You know what, I’d like to play games but I don’t have two hours, I have fifteen minutes and I’m not going to spend sixty bucks.’

The good news is, while I think that we’re seeing traditional gaming shrink, we’re seeing gaming overall grow. To me it’s a very positive message to the overall industry.

But it must be a scary prospect for those that work at the more traditional games firms. Many of them are being warned this model means they will soon be extinct.

I think people have to change. You can’t think about $60 games and X install base. You’ve got to think ‘where are all the gamers today?’ They’re on that iPhone, they’re on Android devices, they’re on tablets, Macintosh, they’re on that PC, they are everywhere and by the way, they are still on consoles, too.

So what net do you want to cast to catch the biggest gamers? Frankly, right now, the largest net you can cast is social and mobile gaming. They also happen to be among the fastest, if not the fastest, growing segments of gaming.

It’s growing the industry. But Ithink traditional gaming is under a little bit of pressure.

However they’ve been through these changes before. The difference is that this is a different change than the industry has seen before. This shift is about bringing as many people as possible to experience your game. If they’re not ready for it and they want to live in the traditional world, you can, it’s just there’s going to be a few big games a year and if you’re one of those games, more power to you. If you’re not, it’s going to be tough.

The great thing about the space we’re in is that anyone can be a developer. Anyone can play games. You don’t even need a quarter in your pocket to play that Pac-Man game – you can play it for free.

Now the irony is that I think it’s harder than ever for a developer to get a game noticed. That’s why we have recently launched our own platform, Zynga.com. I’d love all of the top games on Facebook to bear the Zynga badge. We don’t have to develop them all but we can work with independent developers to take their games and bring them out to the masses. We believe in connecting the world through games, we’d like to get a billion people to play, we realise we can’t do it all together so how about we open up our platform.

Ultimately if you are one of those people looking at what’s happening and you’re saddened, you can be saddened by the news or you can do something to change it.