Internet DNA Podcast

Did you know that the porn industry was the pioneer of pushing boundaries and making the web what it is today. The games industry has now taken on this touch and we discuss in what ways and how gamification has spilled over into other aspects of our online and offline lives. 

Does a leader board, 100k+ followers or super hosts actually just put the rest of us mere morals off and how does this play out with morale in educational games? Dan has a rant about loot boxes (again!)... and then we move on to the finance industry magicking money out of the air. Errrrr might we get some negative feedback? You will have to listen.

Transcription

(this transcription is written by robots… so don’t be surprised!)

Hello, welcome to this week's episode, the internet DNA, with me AbiI. This week we're going to discuss the game industry and how it's beginning to push the boundaries in different aspects of our online life.

Yes. Taking over the place of pornography.

Yes. Which was what exactly? Pushing the boundaries of how to use video on the web, wasn't it?

How to take payment. Actually at the beginning of the webs, they were sort of the trailblazers, the industry, the internet helped to the most. I think that's probably the way to put it because of the anonymity. No longer did you have to go with the Corey face to a garage attendant buying whatever you were buying. You could suddenly do it anonymously and that was a massive boost for the porn industry and they were like the leaders in payment capture, gated content paywalls.

Well also the type of advertising that's bands now, but pop ups, cookies, everything that didn't let you get away from, I've got quite a funny story. Let's hear it. I was at my parents' house and my brother came stay. My parents were away and my brother thought they hit. Just see what all this poem was like on these computers. So he had a look and then it had embedded itself with cookies into everything and he couldn't get rid of it. There were shortcuts all over the desk, curb a popups. Every time you opened up the browser everywhere and every time it closed it down, more popped up and he couldn't get rid of it and finally had Scott, Abby, Abby, I've done this. I don't know what to do. And I managed to clear out most things, but for years to come, my dad would occasionally say, it's really funny. Occasionally I get these odd girls pop up on my screen for no apparent reason. I think rather liked it. So not that,

not that, but that is delivery of malware. The addition of other apps into app freeware does that. Adobe really used to do that for a long time. When you're in the stalling Adobe reader, it used to try and in the store other things, Java, the Java platform, you scenario as well, which I never really understood the idea of it, which is if I'm trying to install the debut reader, I don't want other things I want other things I will get. The companies have realized that that actually is an older style.

When I install software now, I always go and check what else is put in. I've had antivirus putting malware in probably so I can then go, Hey, we got rid of the malware. But I was shocked. And so I always go into my programs, see what's been added when I added this thing and remove anything that doesn't look very nice.

So we were talking about gamification and obviously games are now pushing the forefront of micropayments, so tiny, tiny amounts of money, but all the time, and I work in the publishing industry and we're still in the world of pay walls and data walls and there's quite a lot of friction. And what the gaming industry have been very good is making that whole payment process very frictionless. Almost that you don't notice that you're paying 25 pay 75 and P one pound 20 but you're doing it all the time. 50 gems, a hundred gems, 2000 gems or whatever you're buying. And I think that game I've taken over a pornography as the forefront of data and financial capture. If we look at fortnight, you start to see how they took that to the next step, which is they then socialized. So they turned a whole game. I don't know if they did it on purpose.

I think it might have happened by accident, but I mean I remember for a year or two you'd go to a playground and everyone was doing the floss and all the different sorts of dances and that was immensely instrumental in driving that game's popularity because even if you'd never played it, you already did it's dance and you desperately wanted to play it aimed at that age group. And Fortnite is incredibly good at is taking your money. They release a skin every single week. So previously when you used to buy a game, you would buy the game, you would go to a shop and you would buy a box and inside would be a desk and you would buy the game. And then all the payments. Then they started doing things called DLCs, which is downloadable content. So you might buy the game in a box or you might download it, but then maybe three months later they would give you like an extra set of missions that you had to pay an extra piece of money for.

And then it turned into guns or weapons packs or starter packs. And they're very, very good at making sure that they're constantly monetizing. So rather than, I've been like a film where everybody goes to see the film and then you get residual money after that from things like DVD sales are so quite old when I'm talking about DVDs, but streaming services and that sort of thing. So that's how gaming worked originally. And now they've moved into this freemium model where you don't even go and buy the game to start with. The game is free. But what they do is they charge you constantly all the time. You need to have a battle pass or you need to buy extra skins. Even to get through the battle pass, you need to buy premium time that gives you extra money or extra XP to take the grind out of the game. So if you make a game very grindy, then it's easy to make money. Say, Hey, well you pay us a little bit of money and we would use the grind for you so that your progression through the game is easier. That's moved more and more into not just getting ahead in the game, but actually getting ahead socially outside the game. And that's where it starts is a little bit worrying

because you've got the best skins and therefore when you talk to your friends in the playground, you can go, Oh, don't you have that new scheme you've only got, Oh, well, is that what you mean?

Oh, if you were playing the game and people are teasing you like, Oh, you've got a noob skin or all that's lost, weak skin, or how come you haven't got the level eight dragon yet? No team

without the right costume. I mean everything that you might want to go and get an outfit and the real world, you want to get better outfits, better haircuts, better bodies. In the gaming world, I think that there's been a transition hasn't there that everyone's used to hundreds of millions of users now for digital products, games, online apps. Whereas that would have been unheard of before the internet. If people were buying a game or watching a movie, the actual numbers had been so much smaller, so you had to do this large upfront cost because you just didn't have the amount of people that little small costs were going to hit them up.

Oh, so you didn't have the delivery mechanism before the internet. How would you have charged people that all

PayPal, Amazon pay, Apple pay of all really rich [inaudible]

also online gaming. People forget that Counterstrike was turn of the millennium, certainly 20 years ago, since that even really was a thing and that wasn't a big thing for a lot of people. It's changing the way our children interact. They interact a lot through the games that they play with their friends, especially now with the lockdown in the UK,

going back to how the games industry is pushing boundaries for the rest of the internet, it also helps, doesn't it? But now what? This one and a quarter billion people that play games, whereas 20 years ago when we were growing up, it must've been tiny. The amount of gamers was a very, very niche thing

and it was something you did on your own or in very small groups. There was no way of massively leveraging the social aspects of charging money because you sat around together in a room and you played games and you took turns. But now of course, it's massively distributed. There are hundreds of people together and you could be playing with your entire class and then it becomes a lot easier, especially when you're playing with people you don't know very well, you're all, you don't know at all, which is one of the issues that we have. It makes it much easier to use game mechanics to make people feel that they need to progress better or they need the extra help to be as good as other people in that competitive part of gamification, which was very difficult between three people who knew each other well. I wouldn't have in front of them paid for an advantage,

but talk, you're being paid. You used to win money from gaming quite some time ago.

Well, I'll play counter strike.

I assume that still goes on though. That's

much bigger money now.  Council's truck is a huge industry now. When I played it, it was fairly small teams. It wasn't a massive thing like it is now, which was fun because it was a rewarding something that I did. Anyway,

spending money online and the games industry is also facilitating a bit like being an athlete, working towards the Olympics. You can be a top top video games. It's not really a video game anymore. Games player and an a vast amount of money and I imagine get real celebrity status as well.

Yes. But actually I think the people that really make the money or the streamers, they're the people like Ninja.

The people watch them playing.

exactly. And actually they're entertainers. It's not the fact that they're the greatest exponents of their game that it funds to watch and the kids look up to them and those are the people who are making the proper proper money. I think the serious professional gamers and they train like athletes, they have to do fitness. It is quite a weird business actually, but

being a amateur sportsman or can you be professional on as well where you're training for the Olympics and you are the top of the world, but the money is not brilliant. And then you might be in the sort of commercial side of sports and you're earning an absolute fortune but you might not be as good as the Olympian. So it's similar to that. I think we should quickly explain as well what the streaming is. There's a huge industry that's popped up off the back of gaming, which who would have known of gamers videoing themselves, chatting about the game, putting it on YouTube, people watching and obviously YouTube [inaudible]

Oh, not putting it on YouTube, doing it live on Twitch. So last weekend was really amazing. As you know, I'm a formula one fan and instead of the formula one, because obviously it's not running, they did not do the Australian grand Prix and they had drivers like max for Staten, Lando Norris. So formula one drivers plus a load of non formula one drivers. They had the ex worlds SIM racing driver, Brendan Lee. They had some just SIM racing YouTube people with steering wheels and pedals and all the care driving and they did a grand Prix and Lando Norris had something like 140,000 people watching just him. Like there was obviously there's 24 drivers. Each one was streaming themselves plus there was a main stream.

So this is going to be a new offshoot for the four minute one, isn't it?

Well, I thought it was really interesting that, and one of the things that you maybe don't know about streaming is that people donate while you stream. You'll see constantly, you know, two pounds, five pounds, 10 pounds, two pounds, five pounds.  constantly, constantly, constantly, constantly money coming in.

Let's say you're really great. Keep going. Here's the money.

Well no, just thank you. That's what I find quite amazing about a younger generation. They're very, very happy about donating money to people while they're watching because Twitch is free, there's no cost to it. So you can either subscribe to somebody. So I'm an Amazon prime subscribers, so I get one free Twitch sub and I can then subscribe to someone's Twitch stream and they'll get three pounds a month from me. Now you've got 10,000 people,

the Amazon day, just part of your prime or

you can pay yourself. So a lot of people just do that normal Twitch subscription. So I think they pay $5 and $3 goes to the person and $2 goes to Twitch. If you have 10,000 subscribers as quite a lot of money, it's 30,000

the revenue stream that used to just be a thing in the music and the film industry and it used to be carefully guarded and sort of put through the big businesses. It's open to everybody. The younger generation is so good at working with revenue streams. I use beautiful competed artwork, which I'm trying to mock up a graphic or something for my work and they're all free. But if you use the a bit then you'll give a couple of dollars to the designer because they've done a really amazing job for you.

I like honesty box kind of idea. I think it's a really nice way of dealing with it cause you don't feel forced into it. You get to choose. And then if you think actually that really was worse than money, it's me. I'm going to give something to God. It's open to abuse. But I think like we were talking last week, you take the fact that some people will abuse the system on the basis that it's a much nicer system going forward.

So that's another area that's sprung up out of the gaming industry is this revenue stream for the masses and the honesty of it as opposed to the top down, you must side of it. Um, because of the amount of people now available to do it. It works. Before that just weren't that many people engaged with a certain product or certain industry. So you couldn't do it. It wouldn't work. It wouldn't been peanuts. But this way because of the volume, it does work.

I mean the other one is Patrion, which I'm sure a lot of people know, which is when Google advertising on YouTube started to stop being able to sustain a lot of people from running YouTube channels. There was a service called Patrion where you can subscribe to somebodies YouTube channel and you can pay monthly and you might get some advanced access or they often do it in levels. So if you're just a basic, you pay a dollar. If you want to be slightly better, you paid $3 $5 $50 whatever they choose.

There's different levels. You can have different sorts of acts. I subscribed to an artist on there and I was gonna talk about that. That's the one subscription. Even if I don't go on for the month, I'm so happy paying because he's not taking the pets and it's amazing what is offered and I'm just really happy to support an artist in that way.

I don't go onto Patrion myself, even if I'm a subscriber because I really do it to say I'm supporting your YouTube channel and that's a form of gamification will really, which is early access. That's one of the things I used to do, which is you pay extra for early access and you'd get extras and if you think about it, that patron works on a very similar model to that. You can watch videos,

Ron silver or a gold level.

YouTube have their own version of this called YouTube subscribe where you get a special tab, I think it's called community, where you can see your stuff, early release stuff, so that's fun to get into it. YouTube, we're also doing, YouTube streaming hasn't been that successful as far as I understand

disruptors coming into their market that they're trying to play catch up with less thing on their laurels a little. It's interesting what you said about the game vacation there because it's been so successful. Games and how they're played and how you entice people that it's moved into other industries. It's moved into how you engage and hook, which isn't such a good word. People into other digital products and even in the real world. So if you take for example, challenges, everyone loves a challenge and if they get reward at the end then all the better they're going to complete that challenge, which is what happens in games and it also happens on digital product. So what you might want some of them to get to the end and buy something when if you challenge them with a few fun processes along the way, then they're going to enjoy it more.

Or if you challenge them to put up a great picture on Instagram and they get rewarded with likes or comments, it's a process. It's a method that's going to take it across. Others, if you start to give people points for what they do on a platform, like what they do, and again, you always get points in the game and when you get a certain amount of points you get rewarded, don't you? So I know an Airbnb, I get points for being a good host. I'm above a Superhost and yet yes, I'm an ultra host. So first of all with holiday platforms, cause they will do the same. It's all done on how clean you are, your feedback, your rating, everything that people are asked to give feedback on, that's all turned into points. And when you hit certain levels, you get things. So first of all, you get a badge and you get some stickers sent if you want to put in your window so that covering online and offline and then you as you get more points, you get promotions on the listings pages.

When you're a Superhost, obviously that means that people trust you more so that it works more. And then when you get to the ultra hosts, so this is more points from rewards. They give you $100 towards the fella day. So gamefication I feel really good that I've got all these points and I'd be rewarded for it. Feedback works in that way. You might have worked really hard to look after someone at your holiday concert. It might be really difficult, but they say something nice and it's all worthwhile. You go, Oh, definitely do that again. So badges and stickers work really well and that happens across the board now online, you've then got the leaderboard that's not so brilliant outside of games, but the pitting you against other people. Have you done? You're not quite as good as Donnie. If you just pay this a little bit more or what is a little bit harder, you can see your name a bit higher up.

That's the danger of leaderboards is that while they motivate the upper quarter and potentially the second quarter, they totally de-motivate the bottom two core tiles. If you're not in that top 50% they de-motivate you completely cause you think, well what's the point? I'll never get

an unobtainable goal, isn't it?

And it was one of the things I was thinking about Airbnb is one of the real dangers of those types of things like super host and ultras is they create a feeling of lock-in. And let's say I've got a house right next to yours. It's actually the same, equally clean, equally beautiful. The likelihood it is, people are going to go to yours because you have the super hosting and I don't have any of that yet. So

that was across all social media and platforms, doesn't it? I mean the mass and onto a social media is that we're too late for work or for art and just gone. This is blindness. I am never going to get 100,000 I'm never

going to get there because I can't with them Superhost away from it. It's the only one I've ever, ever, I'm not going to go at you. What I'm talking about is we have to be careful when we game-ify especially with things like leaderboards so that there is some form of reset. It's making sure that that leaderboard is fatter wall rather than locks in the incumbent

little sports days, isn't it? We're all winners here.

but in educational games I think it's very dangerous.

I think it brings a broader point across which is what we've seen as designers of the web have got better and better how it's worked against humans really because they've been so good at making us all get hooked and addicted. Whether it's in a game or on social media or anything digital that it's been to the humans detriment and so we have to be Catholic gamification both in the games and outside of the games. For that reason.

Loot boxes are a perfect example of that. What I found really interesting was they found that loot boxes worked best. If you only get a prize every fourth or fifth box, if you get the disappointment of boxes not having what you want in them over and over again, and then you get one that you get the win that make you feel much better than everyone's a winner baby. You just get bored of opening the winnings old. It's really old when you get into the psychology of it and it's why people get addicted to normal gambling, which is you lose most of the time and that's what makes the winds so, so special.

Have less Christmas present fraternities at Christmas. Then they find the ones they get really special,

well just maybe they only get Christmas present every fourth Christmas. I get to go home nights and say, right, I've had this new idea. Every year you'll get to get present. Do you have an actual present? Every four years

that game vacation has moved out of the games industry and across in the whole digital user journey. You can see it used and they have these what's called onboarding screens. Now that they show you, there's the laminations, how great it's going to be and how you can use it. And that's something that's called scaffolding. So you don't get given everything upfront because a rebel to use it. And B, it'll get a bit like, Whoa, that's too much. So little by little things, areas, tools opened up to you. So you row and climb.

That's a real gaming thing where the first 20 minutes to an hour of a game, you're not really playing the game. You're literally being shown this is how you use a rope. This is how you reload your gun.

The other thing that's very gamey is what's called gold gradients in new acts. Progress first level, second level, third level. Come on, you're nearly at the end. Well done. Keep going until you hit the jackpot, you get it. So there's that. And then there's the end game. What do you do when people get to the end? Cause you don't want to stop getting to them forever cause they'll lose interest. So that's when you get the recognition. You are an expert or you're a partner or you're a super duper ultra host, these are all things help you go, Oh now I'm better than the top level, which is me obviously and in Airbnb hopefully I will only drop a few notches in this Corona age.

It affects people in many strange ways and it was quite funny yesterday taking my boys around shops. It's actually quite, I mean this is how we used to think of Russia, nothing on the shelves and just wondering around like Sainsbury's, like what are we going to eat? Well it looks like birthday cake basically is what,

but we have to be careful with gamification because what it does is it increases engagement and increases conversion, which means spending more money. It keeps people there longer and we have to make sure that it's not too long. So it's putting the fun into things. Putting there, it's interesting and engaging to do what is really a daily grind,

right? It is about capturing people and in the best cases nudging them down a pass and in the worst cases cajoling them down a path to where you want them to go and it's not that different from old school marketing. Really find your target market, find the message that they need to hear and push them down that path. It's just, it's done in a much more incremental way.

The one that's spilled into the real world. Of course it's loyalty cards, supermarkets, the best one, you know your free coffee. That's again, it can't vacation there they

it is and it's that use of data, real use of data to understand what people are doing

maybe that we haven't touched, which is obviously important and would have been what they call a graphic industry where they've used as well, but that's bandwidth. The ability to pay high quality one, not the pawns, high quality, but high quality, realistic video across low bandwidth.

Huge compression.  Is that clear? If you think about it, that came out as a web age. That was our nemesis when we first started. It wasn't it, which is how do you deliver a full page of interesting graphically presented content when you've only got a 56K modem,

I have the money to invest on pushing the boundaries of compression. Probably the need for speed is what's pushed forward. Super fast. Broadband and 5g

also very clever ways of managing how you really optimize that so you're not leaving people at the mercy of latency or paying people on slower connection and still can have a reasonable gameplay experience. So one of the problems with counter strike when I played is the fascial connection. The better you are because you just saw everything faster, everything was rented quicker so you have that advantage.

How do you deal with that? Because that's true. Loading time at home is very slow, but they make games to be aware of that.

Fortnite is a perfect example. It uses very little code communicate between the two servers so that people on the slower connections can connect the other ways you designed games that are just slower, that don't require nanosecond time to seven millisecond pain. It creates an unfairness and sorry, you can design games so that you can slow them down. You can make them

ready. Player one.  When he needs to destroy the system, he goes and gets himself bedsit right next door to the base servant. 

sorry. He can be right in

the same with finance companies, they were getting closer and closer for that same reason

and that's why they will sit in the city because that's where the fast data is is the closer you are to the stock exchange, especially when you're working on these really gamed systems, which is basically these nanosecond trading systems. If you're working in nanoseconds, then nanoseconds matter because you've realized there's a differential between the price of it in this second and the price of it and the next second because you're doing that millions of times every second. That's how you make your money. Magic King money out of the finance industry is one big game. It's gambling. It really is gambling and a lot of it is mathematical gambling life. If you ever used to watch those guys from MIT who used to go to Las Vegas because they had worked out gaming systems to win blackjack or relapse.

Exactly, and I think one of the questions that people are starting to ask is you look at fund managers, what they used to call a star fund managers, like really? Is it or was it just a computer system that is just running constantly and it's who's got the best algorithms and yet again, it's another game, isn't it? It's a gamification. It's a little bit more serious, but I think all of these systems are starting to understand game mechanics and herd mentality and all of these things. And I think it's an interesting, and there will be a convergence where it becomes harder and harder to draw a line between gaming, marketing, gambling, finance, education. They all become of a thing, digital thing because they've got the data now 30 years ago you just didn't have the data. Now you do. Not only do you have the data, you can do machine learning, you can do AI, you can, and so it will converge as all these things come together and we start to learn things. I mean probably will evolve because people will react to it and it's a constant game.

I like the fact that we can leave it there life as a constant game.

Yes. Isn't that just redo?

I look forward to speaking to you next week. Okay.

Okay. Bye. Bye.

—

Dan & Abi work, talk & dream in tech. If you would like to discuss any speaking opportunity contact us.