Video game industry is one of most lucrative internet-powered industries for decades. However, they are being manipulated from the pressure of improving player retention, power of distributors and high irrecoverable costs of players.
WHERE IT ALL STARTED
Traveling back to the 1950s in which the world first met earliest forms of video games, ‘OXO’ and ‘Moon Landing’. Created as a research of M.I.T professors and students, these games started with an electronic digital computer, and moves were made by means of punch cards.
However, not until the year of 1958 has the term “video game” been completely defined by a sports video game known as ‘Tennis for Two’. In October 18, 1958, an American physicist William Hignibotham, with help from the technician Robert V. Dvorak, designed ‘Tennis for Two’ as stimulating a game of tennis, and were played with two custom aluminum controllers. The game were displayed at the Brookhaven National Laboratory’s annual public exhibition and soon became very popular during the three-day event, with players lining up to witness the game.
‘Tennis for Two’ is considered under some definitions as the first video game to be created purely for entertainment purposes instead of academic research, or commercial technology promotion. In fact, first video games that developed in such age, were non-commercial. They required mainframe computers to run and were not available to the general public. Commercial game developments began in the ‘70s with the advent of the first-generation of video game consoles, and early home computers like the Apple I.
In 2013, the eighth generation of consoles emerged, including Nintendo’s Wii U and Nintendo 3DS, Microsoft's Xbox One, and Sony's PlayStation 4 and PlayStation Vita, PC gaming which has been holding the dominant market share in Asia, Europe, and continues to flourish as a result of digital distribution.
Since the widespread of consumers using smartphones, mobile gaming has been a driving factor for games. People heretofore were uninterested in gaming, or unable to afford dedicated hardware such as video game consoles, have been more approachable by virtue of mobile gaming.
THE CURRENT STATE OF THE GAMES MARKET
At present, modern games not only encourage people to actively participate, but also allow them to enjoy their passion for gaming in ways that dress well with their states of emotions, locations, lifestyles, interests and budgets. The global games industry has renovated itself to optimize user engagement and revenue growth on a global scale.
According to a research by market analysts Newzoo, the video games industry was on course to generate a revenue of $137.9 billion in 2018. The number of gamers had reportedly grown more than 2.3 billion globally, while 51% of games market revenues were attributed to mobile games. The domination of smartphones had been a key contributor to the growth of the games market, in terms of both engagements and revenues, but it was only one factor in many more that have brought us to where we are today.
Globally, gamers spend an average of 7.1 hours per week playing video games according to Limelight Networks. There is an increase of 19.3% compared to the previous year.
“2018 was another record breaking year for the U.S video game industry as consumer spending jumped 18% to over $43 billion” - said NPD Group analyst Mat Piscatella.
Accordingly, a US gamer spend an average of $131 per year on video games and the figure is projected to grow gradually. Reports also reveal that gamers play for an average of 1 hour 22 minutes at a time. As a matter of fact, more people than ever are playing games. Whether the games are in casual single-player patterns which can be played on a smartphone; or Battle Royale games such as Fortnite where squads compete to be the last one standing, gamers indeed have plenty of choices.
Last year, Fortnite’s latest version - Fortnite Battle Royale, which became a resounding success, drew in more than 125 million players in less than a year and earned a digital revenue about $2.4 billion[1], and had been praised as a cultural phenomenon. Fortnite was released in July 2017, developed by Epic Games. The game includes three distinct game modes that share the same general gameplay and game engine: ‘Fortnite: Save the World’, ‘Fortnite: Creative’ and the most popular one ‘Fortnite: Battle Royale’.
'Fortnite Battle Royale' is the free player-versus-player battle royale game for up to 100 gamers, allowing one to play alone, in a duo, or in a squad. Weaponless players airdrop from a “Battle Bus” that came across the game’s map. After the arrival, players must rummage for weapons, items, resources and vehicles while trying to stay alive and attack other players, eliminating them. The last one standing after these intense combats is the winner.
According to a new study by financial services company Lenedu, average spending among all Fortnite players was $85 per year[2]. Nearly 70% of these players buy digital items such as pickaxes, dance moves, and outfits to personalize their characters. However, the potential of these in-game items are limited as they are designed for fun experiences only and gamers barely have the opportunity to exchange these items for considerable revenues and returns outside the imaginary world.
BLOCKCHAIN GAMES - THE NEXT GENERATION
In opposition to traditional games, in-game items of Blockchain Games are in the form of NFTS (non-fungible tokens), which enables gamers to monetize their time and effort. Meanwhile in traditional games, these assets, for the most part, flow into the wallets of the publishers. Also, gamers often receive anything in return, but fun experiences. Based on the scarcity and thus value, NFT assets in blockchain games could be appraised to the level of a fortune. In-game assets such as trading cards in Gods Unchained are recently sold up to 35 ETH each- means of $9,380! (01 ETH now is equal to $268)
As the gaming industry is one of most pioneer industries that responsive to the dilation and the adoption of the Internet in general. Naturally, this industry will soon play the leading edge of Blockchain technology as well. Gamers of Blockchain Games are early adopters of such technologies due to their experience with many in-game virtual currency models and acknowledge the benefits of integrating networks into a domain. Owing unique in-games items has become even more lucrative for gamers in the blockchain world.
Furthermore, games based on blockchain generate a truly unique experience to gamers while the others were limited to the ability. Blockchain enables a game-world economy that allows gamers to make a great deal of money through gaming. In fact, gamers are often outraged when games publishers terminate their services due to low revenues and lack of content. The gamers who have poured a considerable amount of money into gaming, and those who want to keep their data as a memory of their experience, often feel as if Thanos has snapped his fingers.
To demonstrate a quick example, the cost of an extremely rare sword item on Lineage fell from $100,000 to $30,000, in 2017, because of an influx of cash items brought in and the game currency had dropped dramatically. There are more sinister cases in which developers easily manipulate the system on purpose. Those problems still happen in a steady pace to the point at which, gamers have to accept them and learn not to keep their hopes up.
Regard to the issues, Blockchain offers gaming both technology and philosophy to solve these problems. Instead of a data controlled by a centralised game server, there is a virtual world run by a non-manipulable and transparent blockchain protocol. Only in blockchain, digital assets are issued and owned via genuine methods, and guaranteed operability across various platforms.
Since the launch of CryptoKitties - a digital cat-breeding game built on Ethereum and the first mainstream-oriented blockchain gaming experience, was incredibly exciting to the tech community. CryptoKitties was released at the end of 2017 on Ethereum’s underlying blockchain network, as a non-fungible token (NFT) unique to each CryptoKitty. The concept of “owning” your kitties and could earn ETH flipping them sparked a viral loop. At its peak, cats sold for hundreds of thousands of dollars. In 2018, a cat was sold for $170,000 and has scored for the most expensive cat in the crypto world!
Gods Unchained, the fantasy-themed trading card game inspired from Magic: the Gathering and Hearthstone, uses the Ethereum Blockchain to house cards in the form of NFT (non-fungible) tokens. Each match is a one-versus-one battle against another player (or computer). Players use their cards collection to build decks of cards and choose a God to play with at the beginning of each match. The Blockchain-based game has captivated the attention from the giant Coinbase Ventures, who participated in a $2.4 million of seed funding. While the game has yet to launch, God Unchained has earned a notable record as a Crypto trading card in this Ethereum-based game was sold at auction for 146 Ethers, worth more than $60,000 at that time.
In Gods Unchained, a total of 380 unique cards are available in the Genesis Season for you to collect. Currently there are 4 types of packs on offer at different points: Rare Pack, Epic Pack, Legendary Pack, and Shiny Legendary Pack. If your goal is to achieve the maximum value so you can trade your cards at a higher profit as your desire in the future, Rare Pack will be the best option. Every Rare Pack gives you 1/40 of a Legendary, 1/5.7 of an Epic, and 1.1 Rares, not to mention the greatest chance at Shinies and Mythic per amount spent. Some of the most played and sought-after cards are expected to be Rares and Epics, you will be able to trade your duplicates for great value in the secondary markets.
Players as well have the chance to earn an incredible amount of Ethers by participating in its World Championship. The entry annually tournament is capped at 20,000 tickets in the form of ERC-20 tokens. 10% of all package sales goes forward a prize pool which is recently worth up to $42 million for winners!
HB WALLET INTRODUCES A BRAND NEW NFT MARKET
Taking initiative in the development of Ethereum, HB Wallet has successfully constructed a solid NFT market with a robust collection of most infamous Dapps games in the industry. That means users of HB Wallet can have an opportunity to experience a wide spectrum of games. They can also invest time and money on developing their own NFT assets (ERC-721 Tokens) to earn rewards, then sell those on HB NFT Market with much greater values.
This May 2019, HB Wallet has announced a new chat function with an intention to optimize the NFT assets transferring process. The integration opens the possibility for users to send and receive ERC-721 while chatting including 2 transaction modes: Direct Sending and Via Smart Contracts.
Any chat session is fully integrated with most features you can think of, which is similar to most popular Chat applications nowadays, but it is slightly more powerful thanks to its NFT function. Accordingly, there will be no problem such as transaction errors or security breaches. However, the most interesting thing is everything can be conducted within a chat session between two parties. It means they can negotiate, place a request then get what they want while chatting. HB Wallet is validated as the first Ethereum wallet in the world to materialize those abilities.
BLOCKCHAIN, DAPPS, ERC-721 IN SIMPLEST WORDS
Since the world gradually shifts its attention towards Blockchain technology - an ingenious invention in the digital age of ‘20s, the games industry has chosen not to stand aside of the mainstream. Innovations in the fledgling field of Blockchain gaming have unlocked the limits of non-fungible assets and are poised to continue supplying cutting-edge developments in other aspects such as scalability. The question is, how does Blockchain work with the games industry?
“The Blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.” – Don & Alex Tapscott, authors Blockchain Revolution (2016)
A Blockchain is, in the simplest of terms, a time-stamped series of incorruptible records of data that is supervised by a cluster of computers without being controlled by any single entity. Each of these blocks of data contains a cryptographic hash of the previous block. By design, a Blockchain is an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way.
The most apparent implementation of blockchain technology for gaming is with decentralized assets. In gaming, these assets can be anything from game skins to virtual cards that are verifiably scarce. The authenticity of these items is guaranteed by smart contract standards such as ERC-721 non-fungible token standard. In such ways, gamers have the ability to prove the provenance of specific virtual items based on smart contracts while in other games platforms fraud cases inevitably happen.
With more than 250,000 active users daily, exchanging in-game items in Ethereum - a decentralised software platform based on blockchain technology - has become a $50 billion industry and is expected to increase in size rapidly. Dapps games items in Ethereum represented as unique ERC-721 tokens, have the potential to penetrate into bustling marketplaces in numerous industries from financial assets to physical assets tied to a blockchain. In other words, Ethereum enables the ability of trading specific non-fungible assets (ERC-721 tokens) between games and gamers secured by smart contracts, which eventually draws a greater business portrait.
Aforementioned, whilst the traditional gaming is just about fun experiences, Dapps games balance compelling gameplays with the new economics via blockchain. Many early adopters of blockchain gaming has viewed this opportunity as an investment since the value of those specific ERC-721 tokens will positively increase multiple times coupled with the growth of the games. In some popular Dapps games, these tokens could value hundreds of thousands dollars.
CONCLUSION
The intersection of Blockchain technology, cryptocurrency and gaming does come with a set of new unique properties, such as social scalability, trust and ownership. If you catch a glimpse at the app store revenues recently, it is evident that 94% of these revenues goes to giant publishers, such as Supercell and others.
The penetration of Blockchain into the new era of this booming industry promises new business models for both digital ownership and game monetization, gamers alongside with indie game developers will be the ones benefiting from the shift.
In greater detail, gamers will be able to become investors in games and have better authorities to affect game decisions, in contrast of how they relate with games today while the game developers are fully centralised.