[In this opinion piece originally posted on the What Games Are blog, and reprinted in full with his permission, UK-based game designer Tadhg Kelly adds his thoughts on the uproar today over Blizzard's anti-modding and always-on authentication policies for Diablo 3.]

Reddit is not happy. Nor Wired. Nor Rock Paper Shotgun. Nor indeed much of the internet this morning. Why? Primarily because of the news about Diablo 3.

In short: the game will insist on using always-online authentication, forbid modding (allowing access to the engine or tools), and include a market for the buying and selling of items. The first means you won't be able to play the game on a plane. The second means that fans will not be allowed to fully express themselves. And the third means that those with more money may progress faster.

Of the three ideas, only the third is smart. Most players really don't mind if others have used a shortcut to their success as long as it doesn't affect them directly. But the other two are terrible. They are indicative of a growing trend in publishing to try and keep players at bay. They may work in the short term, but as long term strategies they are fraught with danger.

The Player Pen

There are, broadly speaking, two ways to look at how to live and work in the online world. The first is to focus on community building, relationships, and building out a franchise by not worrying too much about ARPU (average revenue per user), instead worrying about user engagement, virality, and loyalty. Typically companies that have grown up online and made a success of it understand this organic approach better because they grasp that the digital space is basically conversational.

Offline companies, those that made their bones in boxed product or broadcast entertainment, often behave differently. Their strategy is to try and pen players in. They want the players to play, and they want them to keep doing so, but they also want them to sit in a pen and only play with the content that they are given. And to pay for that privilege.

The reasons for this are many, but they usually start with concerns over ARPU. To the broadcaster's mind, activities like piracy and modding are a threat because they reduce ARPU in the immediate term. A pirated copy may be a sale lost, and that is essentially all that they can think of. There is no possible upside from allowing works to be distributed for free. (Which is, of course, completely wrong.)

The other reason is that such companies are often managed by people who have a classical kind of business training (such as MBA grads) and tend to instinctively regard talk of community building as something more peripheral than the core of the business. It's harder to express the intangible value of community on a balance sheet, and even harder to scale it, so the simpler and less imaginative solution is to think like a broadcaster.

Most big game publishers operate this way because they have largely grown up in a broadcast world. They tend to think, much like other publishing industries do, that the internet is really more of a problem than an opportunity, and they'd really rather wish it would all just behave like retail. Life was simpler when the business involved selling boxes on shelves in stores for Christmas, but these days it seems anything but simple. Every successful game online seems to be a special case, hard to model and scale. There is a frustrating lack of a secret sauce or a replicable process in the online world, and that drives publishers crazy.

So even companies like Blizzard – who have managed to make some of the most successful online games ever – fall into this thinking after a while. Their priorities at the corporate level are more about cash return than growth (especially a time when much of the industry is experiencing shrinkage), and that trickles down into development.

Doubtless many of the developers working on Diablo 3 would love nothing more than to be able to create mod tools for the community, but they've been told from on high that that's just not how things work any more. The threat of devaluation is too great to allow players to leave their pen. It will only lead to chaos.

As for the poor player who wants to play the game while flying coast to coast? Well the response from Blizzard is: "I want to play Diablo 3 on my laptop in a plane, but, well, there are other games to play for times like that." Which is basically a nice way of saying tough.

Unassailability

Why do previously-smart companies end up making dumb choices, and why do they feel comfortable telling their customers to suck a lemon?

It's because they believe that they are unassailable. Where most companies work hard to find, engage, and retain customers, it tends to be the case that dominant companies start to believe that they will always dominate, and of course they don't. This is also known as the 'Why MySpace Died' argument.

It goes something like this: MySpace built a fantastically successful social network that put users together in their tens of millions and seemed to be a cool place to hang out. It had massive retention numbers and was the next big thing on the internet because it had built a passionate community. News Corporation decided they wanted a piece of this action, bought MySpace, and proceeded to bring a broadcast mentality to where it did not belong.

They started to try and, as they saw it, maximize the opportunity. The users of the service started to feel as though MySpace was not really cool any more, that it was becoming annoying, and they tolerated more than enjoyed it. Eventually this got so bad that users jumped ship, leaving the MySpace execs holding the bag and wondering where they went wrong.

I think Blizzard is roughly in the position where MySpace was at its height. They have several hugely successful franchises, but they seem to have acquired more of a broadcast mentality in recent years and are behaving as a company that believes its players will never leave.

That's a dangerous assumption, however, because there is always a competitor waiting to offer a more tolerable product. Given sufficient choice, players will eventually take that choice, and they will always prefer the choice that involves the least friction. Indeed, many would-be Diablo players on Twitter are today declaring that they have had enough of Blizzard and are looking to the Torchlight franchise (which is broadly the same kind of game as Diablo) instead.

How Life Is (It Isn't Really)

It is common in the older parts of the games industry to believe that protection is needed against the hordes of players because without it your product will be devalued and destroyed. Players are zombies and need to be treated as such. That, the industry thinks, is just how life is.

Life is actually exactly the opposite. It comes down to this: You can embrace the nature of the online world – distributed, community oriented, conversational – or eventually be replaced by a competitor who does. It does not happen quickly nor cleanly, but all such dramas in the online space ultimately play out the same way.

Life is actually about a world where growth matters more than ARPU, where customer satisfaction is the only game in town and where even the perceived secret sauces of game design and technical chops are only short term advantages.

The second that you start to pen your players in and respond to their fury with blithe "Too bad" statements is the second that you start to lose. And when your customers eventually do walk away (which they will), then it will be you holding that bag and wondering where it all went wrong.

(Today's image comes from Shaun of the Dead)

[An Irish lead designer and producer living in London, Tadhg Kelly is the author of a challenging book about, as he describes it, "Reclaiming games as an art, craft and industry on its own terms", entitled What Games Are. The blog for the book is whatgamesare.com. You can also follow his tweets on Twitter (@tiedtiger).]