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Social Gaming Summit: The Platform Holders Speak

Social Gaming Summit: The Platform Holders Speak Exclusive

June 24, 2009 | By Christian Nutt

To find out what's required for a successful social gaming platform, the 2009 Social Gaming Summit brought together four panelists from four of the biggest social networks, including Facebook, to find out what they consider to be the key to their platforms and the success of social gaming.

The discussion took place after a panel of social game-makers, including Zynga and Playfish reps, debated making games for social networks.

It included Jason Oberfest of MySpace, Gareth Davis of Facebook, Andrew Sheppard of Hi5, and James Liu of Chinese company OPI -- which operates the Xiaonei social network. The panel was moderated by Michael Arrington of TechCrunch.

The discussion was particularly relevant to game developers because, with games such as Restaurant City and Farm Town grabbing millions of unique users on social networks -- users that can then be monetized using microtransactions -- it's an increasingly fertile area for game creators to play in.

The Foundation of a Platform

The first question is probably the most relevant -- and easily the most basic: "What is needed for a successful gaming platform?"

Davis addressed the question in light of Facebook's area of superiority: "I think it all starts with audience. The larger the audience, the more successful the platform."

But to access that audience, APIs are also required, and to protect that audience, policies from the platform holder are also important, he says. Davis also proposed another Facebook advantage: its reliance on a real-world identity.

Sheppard, appealing to developers on behalf of the U.S.-based and increasingly gaming-focused Hi5 -- which is much more popular in Latin America than its home territory -- suggested three key elements: "You have to be able to deliver the audience to the games that people care about. You have to make the business sustainable. Our payment solutions, or third-party payment solutions, are critical to the mix."

The audience was then asked if implementing an in-house, official payment system such as Hi5's solution is necessary for gaming to take off on a platform. Few raised their hands, to apparent surprise from Sheppard.

Said Davis, "We don't believe that a Facebook payment system would be something that would help the ecosystem. The ecosystem is doing fine." However, Sheppard countered, "Companies have had great success monetizing audiences that people in the U.S. aren't even considering," using its localization and payment tools.

Of course, MySpace allows ambiguous or anonymous identities -- and as Oberfest said, what's required is merely tech and policies which "allow natural user behavior to occur;" giving users the freedom to play what they what they want to, how and when they want to, is the key.

To that end, Hi5 monitors clickthrough rates on games and advertisements in an effort to cut down on spam -- low clickthrough implies spam problems.

Facebook Connect: The Next Big Thing?

Unsurprisingly, Davis began to turn the panel into a platform to promote Facebook Connect, a solution the company has implemented which allows outside applications to draw on Facebook account data and publish updates to users' pages. This will be implemented on Xbox 360 and Nintendo DSi this fall, and is already in iPhone titles.

To that end, Davis believes in the power of "multi-device gaming."

"If I have an iPhone and you're on Facebook, we can game together," he said. "I think E3 was very much an inflection point for me... Not just Xbox and DSi Facebook Connect technology... I think we are seeing a lot of talent transition from the traditional games industry to the social games industry.

"The second thing is that the console companies really get social now," he continued. "I think this really changes everything. I think we're at the beginning and it's going to take a few years. There's a lot to learn as both industries converge, and they're both complimentary."

When quizzed about what titles show this advanced learning from console companies, Davis demurred. "It's still very early and I don't think any of these projects are announced, but I'm very impressed," he explained.

Davis said such projects from big game companies are "fundamentally social" and take advantage of the "multi-device" paradigm. He later described the future of games as "device-based and hooked into a social network," and it's clear that iPhone and Xbox 360 are both "devices" in this context.

Sheppard, instead, turned the discussion to one of the most basic concepts: fun. He said, "We're now focusing on fun and defining the social graph around that. It's an important nuance but it's a very key thing to call out. Specifically, when you're focused on fun, real-world identities are less relevant. It's more focused on aspirational identities" -- a concept with which online gamers will all be familiar, but one which is in direct contrast to Facebook's fundamental paradigm.

However, Oberfest, despite MySpace's semi-anonymity, said, "There's no doubt that authenticity in relationships drives engagement in [social networking] games."

What We Might Learn From China

James Liu works for Oak Pacific Interactive, a very large Chinese internet company that owns the social network Xiaonei -- which, with over 40 million users, is often compared to Facebook.

"China is a very unique market in the world," he observed. In the view of OPI's chairman Joe Chen, as quoted by Liu, "Communities are becoming more gaming-like, and games are becoming more community-like."

To that end, said Liu, "One of the things we do differently from any of the companies in this panel. We're one of the very few companies in the world who has a social gaming platform and close to 400 people dedicated to MMO development in-house." This MMO is integrated directly into the social network via API.

Other concepts OPI works with are more familiar to U.S. social networking companies, though the situation is slightly different in that the company itself operates the games. OPI monitors user behavior and suggests new games in the users' newsfeed, and its user base is also integrated across multiple OPI platforms; none of the U.S. companies currently operate multiple networks.

One notable observation Liu made was about the reading material the OPI engineers have by their desks.

"These guys are [engineering] PhDs from top-notch schools, but they study economy right now," as well as psychology, he said: all the better to understand and motivate user behavior in social networks.

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