Discord is Ready to Take Over the Gaming World

There’s not a lot getting in its way.

On July 10th, 2008, Apple’s App Store launched with a jaw-dropping roster of five hundred apps. One of the games on that store was Aurora Feint: The Beginning, a game which combined Bejeweled-like tile manipulation with RPG elements. Its sequel incorporated significant community-oriented features, including chat rooms, profiles, and friends lists to complement its multiplayer. These games were always well-reviewed, but not successful enough to turn a profit.

The developers, running out of money, discussed other ideas for mobile gaming. One of them proposed (more in passing than anything else), an “Xbox Live for iPhone” and they were so unsure of the idea that the company (then only a handful of people) decided to “just announce it and see if people would want it.”

Less than a year after the release of the App Store (March 2009), OpenFeint’s first version was released with 30 games from 15 developers. In April of 2011, OpenFeint was sold to Japanese media company GREE for $104 million.

OpenFeint’s CEO, Jason Citron, used that money to found another mobile gaming company, Hammer & Chisel. Hammer & Chisel’s inaugural game was Fates Forever, a free-to-play MOBA designed specifically for tablets.

Citron was fueled by a passion for gaming and mobile gaming in particular, but he was also making a decision informed by market trends. Tablet sales at the time were predicted to eclipse PC sales by 2015, and the way he saw it, “Millions of gamers are going to grow up in a world where their first personal computer is a tablet, not a desktop PC.” Tablet gaming lacked a “core game.” In the process of starting Hammer & Chisel and developing Fates Forever, Citron raised $8.2 million in venture capital in a funding round led by Mitch Lasky, a major investor in Riot Games.

Fates Forever had a Metacritic of 82, was an Editor’s Pick on Apple’s App Store, and was heralded as a pioneer for tablet MOBA gaming, but still failed to turn a profit. Exactly why is anyone’s guess — some googling can lead you to Reddit posts that reference its death, but it being Reddit, there’s plenty of disagreement.

It was at this point that Citron and his company Hammer & Chisel made a pivot.

History repeats itself

Aurora Feint’s focus on community must have been important to Citron, because the idea for OpenFeint was to preserve the social aspects of the game. The immediate response of mobile developers to Citron’s announcement of OpenFeint clearly made an impact, as the parallels with Discord’s inception are all too obvious.

Discord reportedly started as a sort of successor to OpenFeint — that is, it initially focused on the mobile platform and exploring its social networking opportunities. But this exploration quickly expanded to PC gamers.

A lot of the most important relationships with my wife and best friends are built around games. A lot of our best memories we have are about playing games together. That’s what motivates me. I want to make things that help people become closer together through games.

Discord‘s biggest challenge was the network effects of the existing chat clients, and their diversity. Curse and Skype were good free services, and beyond that there was Teamspeak, Mumble, and Ventrilo if you were willing to shell out for hosting a server. Convincing a user of any of these services to switch would be near-useless to Discord. They needed to convince you and your friends, and without spending any money on marketing (early on, they didn’t), the best way to do that was to be the best by a wide margin — if it was only a little better, the benefits of switching to Discord wouldn’t outweigh the trouble of getting all your friends to switch.

Now, Discord Inc is valued at $2.05 billion and has 200 million users, with 14,000,000 average daily users. Discord’s disruption has forced other companies to reevaluate their commitment to and position in the social segment of the games industry.

What makes Discord special

Rather than recount the process of Discord’s development, it would make more sense to identify what exactly makes Discord special and sets it apart from other options.

Above all, Discord caters to the “gaming socialite,” the gamer for whom gaming is a social hobby more than anything else. As a gaming socialite, your first choice of what to play for the night, what to buy to keep your attention for the next few months, and to an extent even what streams to watch are based on what your friends are playing. The gaming industry has increasingly shifted to cater to the gaming socialite, and to make its games continuously fun to play with your friends with long development cycles and in-game events (events in Fortnite such as Kevin the Cube are an excellent example of this). Sustained revenue also became a part of this, giving rise to the modern prominence of microtransactions.

One of the big challenges with [Steam] is that they have so much content that it’s very hard to figure out what you want to play. You go in there, and it’s this huge wall of stuff. As more content gets added at a rate that’s faster than you can get through it, it becomes challenging to make decisions about what to get. What I personally end up doing is look to see what my friends are playing, and I choose to play games based on what they’re doing and what they’re telling me, and Discord is where that’s happening. So it seemed very natural for us to make it very convenient for you to buy the game that your friends are playing. 
-Citron at TechCrunch Disrupt 2018

Citron and his team at Discord recognized two things: A strength in his platform and a weakness in that of Steam’s. In Discord, the gaming socialite was a powerful force that could be easily harnessed with minimal intrusion on the user experience. Later in that same interview, he discussed how straightforward it would be to nudge the user into buying on Discord with buy buttons next to Rich Presence popouts, and other plans.

Discord doesn’t need to expand the games marketplace segment of the gaming industry and become just another medium-sized store on which you can buy some AAA titles. Discord just needs to become the first stop for players who want to buy a game their friends are playing. If I see my friend playing Monster Hunter World on Discord and decide it’s time to buy, all Discord needs is for me to buy it there instead of on Steam. To do that, they just need to make it easier. Having a buy button right there would be a compelling first step.

The second thing the Discord team recognized is the weakness of Steam. Steam’s immense library is not always a strength. It is nice that most games the players want can be found there, sure, but the curation is mediocre and the social services through which they might communicate with friends about what to buy are incredibly lacking. The oversaturation of the Steam store is something Discord has recognized: The word “curated” is used multiple time in the blog post announcing the Discord Store’s beta. Steam has also recognized the latter point, rolling out a revamp to their friends system (something Citron indicated he isn’t very worried about).

But the bigger problem (the “huge wall of stuff” as Citron calls it) is known in behavioral economics as choice overload. Multiple studies have been done on choice overload, and it causes decision fatigue, unhappiness and “choice deferral” — outright not making any decision at all. Too many games in a marketplace probably won’t make you sad, but for any seller of anything, the worst choice a customer can make is the choice to not be a customer at all.

Proper curation is meant to combat that, but still, the bigger target for Discord is the gaming socialite. Properly leveraging its dedicated userbase of gaming socialites will hinge on a proper understanding of the gaming industry and the players themselves.

Games vs gaming

To better articulate the position of Discord, I should explain the difference between the terms “games industry” and “gaming industry” as I see them.

The games industry is the easy one: The business of developing, publishing, and selling games themselves. It’s straightforward; the t-shirt industry is all the people who make and sell t-shirts.

The gaming industry is the broad, generalized term, and can be difficult for anyone on the outside looking in to fully understand. It includes streamers; esports players, viewers, sponsors, and venues; proprietary programs and applications (social services like Discord; recording services like OBS, XSplit, and Shadowplay, along with anything else made to accompany gaming); PC hardware marketed to gamers like Razer, Alienware, and Asus’ ROG line; and gaming-focused media creators like Funhaus and other individual creators. Anything that revolves around video gaming is encompassed under the term “gaming industry”. The different parts of the gaming industry, like hardware, esports, and streaming, I will call “sections.”

“Gaming is the world’s largest niche. So I think if we can add value into the lives of gamers in a meaningful way that is around games commerce, then people will buy content and allow us to participate in that.” 
-Citron at TechCrunch Disrupt 2018

Discord’s hold on the social section of the gaming industry is firm, and they have rightly been looking to other sections of the industry.

What comes next

Discord‘s primary competitor in the near future is Twitch and the Twitch Desktop App, but Discord is in a much better position for the future. Twitch’s app is the result of acquiring Curse, LLC and relaunching its client, and it isn’t impressive. PC Gamer magazine called it “an ungainly attempt to do everything” — it’s essentially a heap of Discord-like features tacked onto the Twitch in-browser experience.

Discord has the advantage of attracting (and already having attracted) people who don’t care for streaming. If you’re one of those people, using the Twitch desktop app is a cumbersome and unattractive option.

The future of Discord will hinge on its ability to balance a transformation into a more ubiquitous service for gamers while still maintaining its original spirit of a social platform for gamers and their friends. This will require a number of changes, some hints of which are already visible (for the record, these are my personal predictions based on my own knowledge and could easily turn out to be incorrect).

First, Discord’s Library page will have to be completely revamped. It is one of the most striking categories in which Steam (and other clients like Origin) still has Discord beat. With Discord’s everlasting focus on the gaming socialite, there should be no doubt that this is in the works. Features will sure include references to what one’s friends are playing.

Look to Discord’s Activity page for clues on what this will look like. One of the most significant hints of Discord’s ability to anticipate users’ needs is present there: it will provide an overview of which friends are currently in which voice channels across servers in which you are a member. Many users are in a large number of servers, and going through them to see which channel might be doing something you’d like to join in on can be a chore. Discord’s impressively fleshed out Rich Presence feature already provides a good backbone for a similar feature regarding games; opening up your library and seeing that three or four friends are about to queue up in Counter Strike together will make the choice of which game to play an easy one. With one button, you might be able to join their voice channel, launch Counter Strike, and join their lobby.

In any case, the Library will certainly feature something that fulfills the purpose of Steam’s “X friends play/are currently playing this game” box on library pages, but fresher and shinier — the result of a new perspective.

There will also be more fleshed out profile pages for individual users. Wishlists are a must for any marketplace with a social function, and adding that to any profile along with other possible bells and whistles will necessitate something more robust than the small popup that’s currently available when you click on someone’s username. Exactly which bells and whistles Discord chooses to add are up for debate, but I’ll put my money on one feature: a deeper “LFG” system. Users will be able to tag games as “I’m looking for friends to play this with” and either when you launch it or on the game’s Library page, you’ll be notified that your friend is looking for people to play that game with.

The Activity page may also be improved with a better functionality for self-moderation and, possibly, better quality and content produced by Discord itself. In November Discord acquired Blitz Esports, a company focused on in-depth analysis and journalism for CS:GO, League of Legends, and Overwatch esports. Exactly what this might mean for Discord is difficult to figure out; Discord may have just liked a good chunk of the talent behind the Blitz team.

Discord may also want to compete with Twitch in the streaming and esports section. Many esports teams, fan groups (like subreddits), and large streamers have their own Discord servers, and Discord should consider some way of serving these groups more directly; partnered streamers could stream to their fan servers directly in the Discord client. But this feature should be limited to partners and their partnered servers, as it may start to intrude on the original mission and functionality of the software. Avoiding that intrusion should be paramount — the biggest threat to Discord will persistently be a mass exodus of users to another software that they will describe as “what Discord used to be like”.

There is the possibility that Discord might not focus as much on the store as much as we think; a penchant for traditional thinking can limit possibilities. But Citron’s interview at TechCrunch Disrupt 2018 hinted at a serious optimism for the subscription format of game libraries. It wouldn’t just be a revenue model for Discord, but it would affect “the back end of how games are made”. He reference Netflix, and how because of their unique model they (and its eventual competitors Hulu and Amazon Prime Video) are able to greenlight shows and movies that otherwise wouldn’t have been made — could Discord eventually dip its feet into publishing?

That development likely won’t be realized until Discord starts to turn a profit, but for now, Discord is in a good place to become the most ubiquitous consumer-facing software in the gaming industry.