T=Machine

(where normaly people might “Be original, then Apologize if you fail”)

Just a minor piece of recent DRAMA! DRAMA!, something to cheer up the week…

This excellent piece of Advertising / Fun / Augmented Reality / Creativity was – like most big-budget ideas – based on someone else’s idea, someone who had the basic idea (and proved it non-commercially) first.

So far, so good.

This is the 21st Century. People notice when you clone ideas, and they comment. A lot of comments are brief and reflect the emotional reaction rather than a considered opinion. Especially if you disingenuously claim to have invented the idea, and put out press releases to that effect … when there’s plenty of evidence suggesting otherwise.

Still, that’s how life goes; you try something, you veer too close to “copying”, and you get some minor pillorying on a public website. You re-adjust; next time, you’ll try to add a bit more novel to an idea – or you’ll work harder to give credit where it’s due.

OR … or, one of your team can always just go for the all-out nuclear option, and insult everyone and everything in sight. In the world-readable comments thread. For bonus points, you can then delete your comments a day later when you realise what a douchebag you appear, and how damaging it’s become to your future career:

http://www.flickr.com/photos/pixelsumo/4752204508/sizes/o/

(I love how Nicholaus is naive enough / bad enough at his own career to imagine that simply deleting or editing a comment makes all evidence of it vanish :))

Filed under : amusing, community, social networking, web 2.0

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I’m getting messages every day from John Say (of Say Design) pushing me to join his network on Ushi.

Ignoring them had no effect; I’m now routinely forwarding these to google’s spam box.

I’m amazed that in 2010 people would send out an “invitiation” to their business contacts without bothering to provide the recipient with ANY REASON why they’d want to say yes. Cluetrain, guys?

(Also: John, and everyone else, please stop. This shitty service doesn’t even include an email address for me to ask you directly)

Filed under : social networking

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Interesting search result for “O2 Facebook”:

…IIRC that started off as a service for MySpace, then MySpace/Facebook. Apparently now it’s all about Facebook (only). The only mention of MySpace is a navbar link to something about broadband – seemingly unrelated.

PS: Entity System post coming soon, for those that look for such things. I’ve just written one for Android. I just have to take the time to write the damn thing up!

Filed under : amusing, social networking

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(for the three people who haven’t heard yet, EA just bought PlayFish, for circa $400 million)

Three things I have to say on this:

1. Mainstream games industry people question it’s value
2. Yes, of course it was worth it
3. What Would Zynga Do?

Mainstream games industry people question it’s value

I’ve seen a lot of people from the mainstream industry (i.e. consoles, PC games, handheld etc – eerything EXCEPT iPhone and Facebook) incredulous, unconvinced it was worth it. This was the case even with the rumoured $250 million valuation from a month ago (c.f. Nicholas Lovell’s post on that).

There’s also some discussion over at TheChaosEngine (private forum for professionals in the games industry) on the same topic, with similar levels of scepticism about the value.

The main reference points are traditional games companies and their sale prices. That’s where this goes wrong – and it’s symptomatic of something that hampers the games industry: a lack of understanding of the business side of games. For most people in the industry, this doesn’t matter – they’re making games, not selling or funding them. But for the people managing games companies, far too many of them need to get an MBA and learn the essentials of sales, marketing, revenue, and shareholder-value – and how that applies to their own day-jobs.

Yes, of course it was worth it

Reproducing some of what I’ve already written on TCE, since it’s non-public:

There’s three things driving the valuation of PF:

1. A solid business, in business-terms (c.f. Nicholas Lovell’s “6 reasons why Playfish is a steal at $400m”)
2. Quality content-producer, in games / media terms
3. Consistent success, in comparitive terms

Playfish is in the top 3 companies dominating the Social Games sector. They are the ONLY one of those companies that set out to dominate the SG sector – the other two happened purely by accident. PF was architected to take over this sector, and is succeeding at it.

From a game-design perspective, the entire business model for Zynga and SGN has been “keep bailing!”, and they’ve so far bailed faster than they were sinking (where “bailing” means “using marketing and sales ability to make up for severe product deficiency”). That might sound like I’m being derogatory – but compare it to all the “worthy” games companies who bailed *slower* than they were sinking; at the end of the day, who’s the smart one?

But good sales/marketing strategies are easy to dissect and clone, in a way that good content is not.

Part of the demand for PF is that a lot of people look at it and say: this is SGN/Zynga, except they make good games. Yes, they’re not 1st – but any idiot could take PF’s current position, throw $50m of marketing budget at it, and easily surpass Zynga. They will own this market, sooner or later – PF is fundamentally strong where Z is fundamentally fragile. (although Z’s “fragile” is still an order of magnitude stronger than most traditional games companies).

Just to be clear: I have a lot of respect for Zynga and SGN, they’ve achieved a heck of a lot. But they’re sharks. They’ve always been sharks. Comparing to modern standards of game-design, they’ve never had great product. Instead, they’ve been extremely canny, aggressive, vicious, and cash-driven – and they’ve shown how successful and profitable you can be with those things. If someone had asked “how well can you do with a weak content company if you’re exceptional on the business-side?” then these companies boldly step forth and demonstrate that the answer is: “very well indeed”.

But this is a new, novel market. Maybe there’s nothing special about PlayFish?

Well, apart from thriving in a new market against some of the toughest competition in the world, look at the comparitives. Compare PF with – say – Kongregate. That was founded by the ex TD of Pogo after years at Pogo/EA, and was expected to recreate the success of Pogo and expand on it (hundreds of millions of dollars revenue). They’ve fallen a long, long way short. PF was founded years later and is now doing perhaps 20 times the revenue (just guessing based on Kong’s last funding round and how long ago it was).

PF’s success *looks like* it’s “probably” no accident. IIRC (and I haven’t checked, I’m going from memory here, so I might be very wrong) this is the same management team that built and later floated GluMobile. Putting that into perspective:

1. these guys have ridden the wave of an emerging market to create on of the big successes
2. these guys started from nothing and ended up with an IPO
3. these guys then started all over again, from scratch, in a new market … and succeeded AGAIN.
4. …and they did it very quickly

What Would Zynga Do?

This, then, is the million-dollar question: who’s going to buy Zynga?

Zynga have followed a strategy of buying-or-burying every small competitor who came along. As I noted above, despite being rich, hugely successful, and growing fast, they have some internal fragility that PF has never had. Where PF *could*, in theory, get more aggressive, Zynga is already barrelling along flat-out on that front. Where PF has a good reptuation they can trade on, Zynga has a poor one that’s not worth much now PF is part of EA.

If it had been a smaller company that bought PF, maybe – maybe – Zynga could have afforded to try a reverse-takeover to hoist themselves up, and hold on to their top spot in Social Games.

But EA/PF is too complementary a pairing; together, they’re too effective for Zynga to get away with that. Zynga *might* have hoped, with a different competitor, that acquisition by EA would lead to a breaking-up of the company’s value. EA has done this many a time to other acquisitions: small companies vanish when eaten by big ones. But as I noted above (and as Nicholas referred to when claiming that PF’s team could “turn around the tanker” that is EA), PF’s team have enough experience and personal wealth that it is very unlikely they’d disappear inside EA. They *might* retire (despite the golden handcuffs, many EA acquisitions have lead to de-facto retirement of their founders) – but PF is so young as a company that I doubt they’re tired of it just yet.

Looking back at Zynga, this seems to be a company that sees itself as the Alpha Male. I can’t believe they’d settle for second place. So, Zynga needs to be bought. And, unlike PF, Zynga may actually benefit from being dominated by their acquirer (try and wipe out some of that bad reputation; perhaps fundamentally alter the internals of the business, make it into a good content-generator? Where PF is adding Zynga-esque marketing and sales ability, could Zynga add PF-esque content-creation/content-quality ability?).

Who?

I’ve no idea :).

But, looking around, Zynga has greatly underperformed on iPhone. There are a lot of media and consumer giants around that expect to have no problems making lots of money on iPhone. Maybe that would make a good deal, someone already exploring, or set to explore, iPhone, who doesn’t need Zynga, but who could expand Zynga on to iPhone in a huge way. That could even let Zynga save some face in the deal (“there’s nothing about our business approach we wanted to change, it’s just that this was an opportunity to dominate TWO platforms instead of ONE”).

Filed under : entrepreneurship, games industry, iphone, jussi vc deals europe, social networking, startup advice, web 2.0

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I saw an article recently that described this attitude nicely: certain weak marketing executives believe that the purpose of a “conversation” is for them to have more ways of telling the customer what to do; they are seemingly incapable of understanding the idea that a “conversation” involves listening to the other person.

To them, email is a “one-way broadcast medium for us to tell the customer what to buy”, rather than “a two-way communication medium that allows us to listen and respond to our customers”.

Today, I received a great example. Here’s an email I received one month ago, from Apple:

“Thank you for renewing your iPhone Developer Program membership. New Expiration Date: 10 Aug 2010″

And here’s the email I received today, from Apple:

“your iPhone Developer Program has expired” (sent from address: “noreply-iphonedev@apple.com” )

A triple-whammy on appalling customer support there:

1. Erroneously (I hope) claiming that they are NOT providing a service they have committed to providing
2. Taking money from a bank account in return for a service that they then don’t provide (that bit’s illegal)
3. …and:
4. Sending all correspondence from an email address that they mark “noreply”; i.e. “if we (Apple) screwed up, we don’t want to hear from you. We don’t want to fix it. Go away”

I especially like the way they put this all together, so you get the implication that:

Apple would prefer me to sue them (Apple), or file a claim against them for fraud, than to let me send them a simple email and spare them the fallout of their stupid mistake.

Using a two-way media to deliberately ignore your customers? That’s Web 0.1.

Filed under : Web 0.1, amusing, community, social networking

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This talk was all about a theory of innovation/finding new markets known as Blue Ocean Strategy, from a book published in 2005. I first came across this book/theory when I joined NCsoft a few years ago (apparently, the CEO and board in Korea were very keen on it), which is quite ironic given NCsoft’s international activities of the past few years.

It was a good talk overall, with lots of honest and insightful comments from the panellists. The best bit was probably Q&A at the end – which I had to miss :(. Not everything they said was great, there were some dodgy bits, and I missed most of the second half, but it was clearly worth going to.

Bear in mind, though, that on the morning of this talk I was already considering an opportunity I’d seen that seemed to replace traditional games publishers and was looking like it might work extremely well. So … this talk was accidentally of a lot more relevance to me than I’d realised it would be :).

My own commentary in [ square brackets ], any mistakes/misunderstandings my own fault :).
(more…)

Filed under : GDC 2009, games design, games industry, social networking

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Wifi and internet at all is a priviledge – but Free Wifi is something that in our modern society, and the society we’re set to become, needs to be treated as a right. When I started writing this, I was looking at the benefits we have yet to see (ubiquitous free wifi); in the week I’ve been offline with jetlag, the preceding benefits we already have that would make them possible – flat rate internet – are being ripped away from us, and . Both are understandable, but … yikes.

Casual, assumed, free internet access is now ubiquitous (even if the access itself isn’t as operationally ubiquitous as services assume). I can’t even access half my music collection any more unless I’ve got a wireless high-bandwidth connection available (Spotify). The other half lives on my MP3 player (iPhone) – but is static, unmeasured, unconnected, and unshareable.

This is a problem. Right now, sitting in San Francisco, the city of a thousand broken, crashing, low-bandwidth, pay-per-minute (min charge 24 hours) wifi connections, next door to Silicon Valley, a world center of innovation that only exists because the right infrastructure here and the wrong mistakes elsewhere allowed it to form, it’s particularly on my mind. SF is a great example of what will push the next Silicon Valley to happen elsewhere. A lot of people ought to be worried by that – and doing a little more about it.

In Brighton, my current (temporary) home city, the first repeated free wifi hotspots were set up – as I understand it – effectively as an act of charitable benevolence by “a couple of guys” (looseconnection.com/Josh Russell). They weren’t even rich, or old – just some kids doing something cool, and useful. Anyone could do this. Too few actually do. I’ve heard it suggested again and again (where are the mesh networks that were supposed to be ubiquitous 4 years ago?) by people in the UK – especially in and around Cambridge, in tech the UK’s closest replica of Silicon Valley – but always with excuses about why they aren’t doing it yet, aren’t able to until someone else does something else to make it easier for them. That’s crap. Just do it. Do it this weekend; what better are you doing right now?

Will Apple single-handedly save Wifi? Maybe. It could be the biggest gift of iPhone: that it finally turns the rest of the world on to building bigger, better, and above all FREE, wifi networks. Everywhere. Ironic, considering that’s exactly what will kill the fundamental device that drives the iPhone: the “cell” phone. Does anybody else remember that before we had cell phones we had hotspot phones, back when cells weren’t good enough, and were so expensive to use? So we go full circle, but this time with an ecosystem and a tech interconnection system (API’s, protocols, layers) big enough to support the worldwide rollout of such hotspots (well, and that’s what mesh was supposed to be about, right?)

But why would this happen? It doesn’t make sense … does it?

Skype is a great example. Sadly, it’s also overloaded with additional meaning that clouds the issue – because Skype is an internet app (good) that is mostly about phone calls (bad / confusing the issue).

Skype is now available on iPhone, and it’s a great, highly polished, iPhone App. It *works* (as well as anything can on iPhone – with the current version of iPhone Apple does not allow *anyone* to have their app listen for incoming connections and auto-start, so you can only “receive” Skype calls on your iPhone if you are not using any other app and instead are currently inside the Skype App.

But … the voice part only works over Wifi. This is the concession it took for Skype to be “allowed” on iPhone (NB: Apple allegedly forced the network operators to give away free / flat rate data in return for being “allowed” to sell network-locked iPhones; if Apple had also allowed Skype-on-3G/EDGE/cell network, then they would have caused people to stop paying call charges en masse. Although this is the natural future of cell phones, and everyone knows this, the network operators would probably assassinate Steve Jobs if he tried that today).

So, Skype is – effectively – a “wifi-only” application.

20 million devices cannot be ignored

But wait … there’s more. The iPhone platform has an installed userbase of almost 40 million handsets as of first quarter 2009 (yes, that’s only 20% less than the entire global sales PS3 and 360 combined; the iphone is already one of the top games consoles in the world; Sony (Computer Entertainment) is doomed, and Nintendo’s cash days are numbered, even though they’ll make loads of cash for the next 3 years – the DSi was defunct due to iPhone *before it launched*, so after those few years, the cashflow will drop off / vanish).

But … around half of those are not iPhones, but iPod Touch’s. This is very important to understand: the two devices are compile time identical, and *almost* feature identical. They are more similar than almost any pair of cell phones in the world, even ones from the same manufacturer. And by default all iPhone developers are writing code that runs seamlessly on the iPod Touch – it doesn’t (usually) “break” on iPod Touch if it uses an unsupported iPhone-only feature … rather, that part of the app silently is ignored.

So … nearly all those iPhone developers are actually also iPod Touch developers. Many of them deliberately steer clear of using iPhone-only features. Some of them (myself included) write their apps to cleverly detect whether they’re on an iPod Touch, and work around the limitations (it’s not hard – e.g. if I can’t upload scores to the game server because I’m on a Touch that isnt in wifi range, I save it and upload it next time the phone is online. As a bonus, this makes my games work “better” on iPhone when the iPhone has to go offline, e.g. when it goes on an airplane).

NOT “iphone App”, but “Wifi App”

Back to the point… There aren’t many Wifi-only Apps out there on iPhone … yet.

But there will be. More and more of them. And this summer, when Apple brings out the 3.0 update for iPhone, making ad-hoc discovery much easier (i.e. my phone will be able to auto-detect / find your iphone when they’re in the same room), wifi-local Apps will blossom.

A simple example: real-time fast-action games.

e.g. a Racing Game, that works like this:

1. I persuade you to download the free version
2. We each click on the icon on our own phones
3. The phones magically discover each other, without either of us doing anything, within a couple of seconds
4. We start playing a high-speed racing game – e.g. Need for Speed, or Midnight Club – over the local wifi network
5. The net code works beautifully, there’s no lag, everything updates very fast and smoothly
6. When we finish, the free version you downloaded pops up to say “you played with your friend because he/she had the paid version. If you want to play with different friends, one of you will need to buy the paid version. Click here to buy (one click, instant download)”.

All that is possible, and relatively easy, come summer 2009. You *can* attempt to do it over a 3G network, but it’s hard. But as a wifi-only app it becomes easy. Guess what’s going to happen?

The future of local free wifi

I predicted around 30-40 million iPhone* devices sold by now, and Apple’s 37 million official figure made me look clever (although admittedly it was only a 6 months extrapolation and a 33% error margin I quoted there ;)). I predicted around 75-100 million sold by the same time 2010, and I’ve noticed a lot of other people have come up with the 100 million estimate for 2009 since the official 37 million figure came out.

So, although I think it’s optimistic to expect 100m by the end of the year, I’m confident it’s going to be close. 100m wifi enabled game consoles sitting in cafes, restaurants, bookshops, trains, buses, hotel lobbies, city squares, pubs, etc.

Oh, and don’t forget – that iPod Touch, with no “network contract” to pay for, is a perfect gift for kids. Plenty of people have lined up to tell me that kids can’t afford them; the market research that consistently shows under 18′s as the second largest demographic for iphone* ownership suggest that’s an ill-informed opinion. So there’ll be a lot of those devices sitting in the hands of bored children / used to keep them occupied while parents are doing other things. And we all know how strong a child’s “pestering power” can be.

Monetize local wifi? Screw that; who can be bothered to monetize it when it becomes as essential a driver of custom to your store as having coke/pepsi/coffee on the menu (even though you’re actually, e.g. a bookstore…). Re-think how that affects the “monetization potential” of local wifi (hint: look to the already vast field of *indirectly monetized* Freemium / F2P for inspiration)

So, I’m optimistic. And rather than focus on how “iPhone is going to destroy the cell phone / network operator hegemony, and bring around fair pricing for consumers”, I’m focussing on how it’s going to usher in the long-envisaged era of high-bandwidth, low-latency, high quality console games and apps that focus on the local area. I’m happy with that: I’ve spent almost a decade learning how to make online games for millions of players where the core experience takes place in the local group, so I feel extremely qualified to do well out of this. What about you? What will you be doing with it?

Filed under : entrepreneurship, games design, games industry, iphone, networking, social networking, web 2.0

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Adam Martin, (me!)

Summary

I was giving this talk, so … no live writeup this time :).

The slides are up on slideshare here:

http://www.slideshare.net/guest38ac74/how-to-sell-social-networking-to-your-boss-and-publisher-1215019

NB: I lost my voice the morning of the talk, and panicked, and rewrote the slides to include everything in words in case I couldn’t get my voice back (or if it cut out part way through). Hence the unusually dour presentation style. Sorry!

Filed under : GDC 2009, social networking, web 2.0

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