The IPO of San Francisco social games giant Zynga at the end of 2011 highlighted just how polarised opinion is when it comes to this new area of gaming.
The social games scene exploded in last year. The number of games on the market increased beyond all expectations, as did the variety of games - from simple word and puzzle titles, through to massively multiplayer adventures.
This expansion drew in huge numbers of players and led to massive growth in revenues, from subscriptions, the sale of virtual goods and advertising.
It culminated in late 2011, with Zynga's initial public offering which valued the company at over one billion dollars. Not too bad for a company which is not yet five years old.
Despite all of the success however, there remains a lot of cynicism over the future of the social games sector and the long-term value of the games themselves.
Many developers and publishers working within the existing games industry have expressed doubt over many aspects of social gaming.
The fact social games are free-to-play is seen as unsustainable and damaging the value of the game itself. If a player does not have to pay for a game, the argument states, then they simply don't value it.
The reliance of social games on the various social platforms (such as Facebook) ties their future into the ongoing success of that platform. If the network runs into problems (over issues such as privacy), starts to lose large numbers of users, or makes major changes to its support for games, then titles using that network can run into problems.
Then there are the actual games. Perhaps not surprisingly for a creative industry, this is one of the most fiercely held contentions regarding the social market. Social games, it is claimed, lack any sort of artistic merit. They are cynical marketing tools, which use psychological tricks to keep players coming back for more, in order to get them paying. In short they're not creative, fun or 'designed' in the same way as console, pc or even mobile games, but designed and driven entirely by numbers.
Are any of these claims valid, or even fair? In part, yes. However, some of these issues are being viewed in the worst possible light, possibly thanks to the sweeping changes and huge differences social gaming has introduced into the wider games industry.
The social gaming market is something entirely new. Less than five years ago, it did not exist. The fact it does now is down to Facebook opening it's Application Programme Interface (API), which allowed developers worldwide to go and create their own content for the rapidly growing social network.
On any new device, technology or platform which supports consumer facing software, games have very quickly become the most popular type of content. From the iPhone and Apple App Store, to digital interactive television to social networks, gaming it seems that users are discovering the joys of simple, short and low cost ways to play.
However, the market for these new forms of gaming operate very differently from the existing console and PC sectors. The most successful games in new social, casual and mobile markets are free. At least initially. Users who are looking for smaller, simpler forms of gaming are certainly not going to pay £30/$40 up front for a game they don't know they'll enjoy. While much lower price points ($0.99) have appeared on some markets, the most successful games are those which allow users to download and play them for free.
This business model requires an entirely different approach to creating and marketing a game. In the 'traditional' games market, once the player has bought the game, whether they enjoy it or finish it is almost irrelevant (until you come to release the sequel). The free-to-play (F2P) model, has to encourage players to return, to play the game again and again, so that new content, new virtual goods and new abilities can be unlocked or 'sold' from within the game itself.
Many companies are pushing ahead with this model to great effect. New levels, new items, character customisation and rare/exclusive items can be sold to enthusiastic players and generate as much, if not more than simple up-front game sales. Other companies have found success with an up-front payment and then in-game purchases. Others still have made their entire game free-to-play but have included advertising links within the game.
All of these models are still in their early days, but indications so far are that with care and attention to when and how players are approached, they are willing to buy new content on an ongoing basis.
These points of payment however, have become contentious within the wider games industry, thanks to the data which social games companies can gather from players. Unlike the PC and console market, where a player's contact and interaction with the developer/publisher is limited, social games run and interact on a server, so the player is in almost constant contact with the company behind the game.
This gives the social games company far, far more information on how their players act within the game – down to individual mouse clicks, progress through the game and items used.
Many social games companies are using this data to refine and hone their titles, to make them more appealing, more compelling and dare we say – addictive. This allows them to look for revenue on an ongoing basis, keep users engaged and make sure their players are still their players in the months to come.
This focus has lead to some criticism from the wider games industry that the social market, rather than being creative or driven by design, is actually being driven by data analysis and marketing. Many developers are looking upon this as a negative thing, taking away much of the creativity and 'art' of other forms of gaming.
None of which is strictly fair. A game which relies upon more 'casual' players has to be accessible, simple to pick up and easily understood. A game which relies upon players returning many times, so that in-game purchases can be made, has to be compelling and addictive – though oddly enough it does NOT have to be 'fun.
The data on when and how players take part in games, gives social developers the opportunity to really focus on getting players into the game, keeping them playing and encouraging paid transactions. In turn, this understanding gives social games companies certain rules and mechanisms which can be used in new games and built into experiences which should keep players even more engaged and offer more opportunities for revenue.
There is a case to be made that the console and PC games companies, given access to the same data, would be adopting broadly similar approaches to development and design. Major console games cost tens of millions and increasingly, hundreds of millions of dollars to create. The publishers behind those games are not gambling with those sums of money. They're focusing just as much on what worked, what was popular and what players will pay for as the companies working on social games.
Does this mean that data analysis can replace the human element and creativity in game design? Clearly not. Data analysis can only take you so far. Since the social games market is still so young, there's simply no data on long-term use or user response. Nor can data analysis reveal what isn't yet on the market. While many of the leading social games have pulled in millions of players, many more have yet to give games a try. What is it going to take to address these potential gamers of the future?
Data analysis is a useful tool. It can help make identify problems in games and allows developers to refine and polish their titles, but it won't necessarily help create exciting, innovative and unique new experiences which don't yet exist
As for the new business models being explored by social games companies, again there's no real long-term data. However, there are other platforms and indications that virtual good and in-app purchases are being accepted by users worldwide as interesting and valuable.
The mobile markets from Apple and Android feature a variety of apps, not just games, which feature in-app purchases, subscriptions, advertising funded titles and virtual goods. If the platform is trusted, the revenue model convenient and the content perceived as having value, then consumers seem willing to pay for it. Even 'rental' models for online movies, music and publications are beginning to make an appearance. Its up to the creators to ensure that their content is seen to have that value.
Online, existing virtual communities such as Moshi Monsters and Club Penguin have also shown that new revenue models can work – even for audiences of a much younger age.
In short, it seems that the opportunities to move away from the traditional retail model is being explored – successfully – by a large number of companies across the online, mobile, social and casual markets. Which has to be good news for the brand owners, media companies and intellectual properties now looking seriously at these new areas of entertainment for new revenue streams and opportunities to interact with consumers in a new and more interactive ways.
Finally, the concern about relying on a single platform – such as Facebook – is a valid one. While social networks are still a new phenomenon, there is already substantial evidence that all networks are transient. Previously booming communities such as Bebo and MySpace have shrunk to a shadow of their former selves. Yet, Facebook has in many ways rewritten the rules for social spaces. The open API and critical mass of users suggests this network will be around for a significant time to come.
Which does not, however, make it the only platform in town. Users are increasingly choosing their own entry point to the Internet. Some people are Twitter fans and never touch, Facebook. Others have migrated to Google+. In many countries around the world, Facebook is not the leading social network by a large margin.
There are opportunities outwith the world's biggest social network and new channels, communities, networks and routes to market are appearing on an almost daily basis. So while Facebook may currently by the '800lb gorilla' in social gaming, developers, media companies and brand owners need to take a step back and ensure they're addressing the broadest possible audience.
The bottom line in this new 'mainstream' gaming market is that the consumer is king. You need to be active in the channels they're using. You need to be creating games they want to play. You need to find revenue models that they trust and are comfortable using.
Consumers are increasingly technology agnostic. They want their favourite content on all of their devices and the artificial barriers created by different devices will start to disappear even more quickly, allowing Facebook users to compete against iPhone owners, Android users, Google+ members and even the new generation of Internet connected televisions.
Far from being a bubble, a fad or a niche, the rise of the social games market is revealing a future for interactive entertainment which is more open, challenging and exciting than it's ever been before.
Regardless of the platforms, the design methodology, the business models and the routes to market, the future promises to be all about games. Who knows, there may even be room for fun!
