Why do we play video games?
And what do video games actually represent?
Video games have come a long way since the days of Pong and Pac-man. Games have entered the pantheon of mainstream entertainment options alongside films and music. At $138 billion, the gaming industry’s revenues comfortably dwarf both the global box office ($51 billion) and the music industry’s ($22.6 billion) revenues combined. In Netflix’s quarterly report earlier this year, they cited the video game Fortnite, rather than other video streaming platforms, as their biggest competitor. Tyler Blevins, or “Ninja”, one of Fortnite’s foremost professional players and streamers, makes north of $500,000 a month — on a par with the top sports athletes in the world.
How did video games get here? And more fundamentally, why do we play video games? The answer to these questions will help us to understand the role that video games have played in our society till now, and shed light on how they are helping us to shape our future. In our mini-series on gaming, we explore not just the future of video games — we explore the future of mankind.
A brief history of video games
Trends in video game development
The history of video game development can be neatly distilled into four main factors:
- Accessibility
- Simulation
- Complexity
- Social
Accessibility
Games have become more accessible over time. The first video games were played on expensive, gigantic computers and then on clunky machines in arcades. Now we play free games at home on our PCs and consoles, or on mobile devices and handheld systems. With the advent of cloud gaming and gradually declining internet infrastructure costs, we will approach a reality any game can be accessed anywhere, anytime.
Simulation (of physical reality)
Video games went from blurry pixels to high-definition visuals that are indistinguishable from real life. The next step in simulation is the development of VR (virtual reality) and AR (augmented reality) for more realistic experiences. AR provides an in-between state by integrating the virtual world into reality, while VR helps to recreate the sense of depth that we perceive in reality but not in games.
Complexity
The earliest video games like Pong were easy to play with simple objectives. Modern games have more sophisticated gameplay and are a lot more complicated and challenging — for example, League of Legends has 144 characters and players need to know the strengths and weaknesses of each one to play successfully. This complexity is also expressed in MMORPGs where there are almost unlimited possibilities for each individual player to pursue at any point in time. Such freedom and complexity mimic the situations we face on a day-to-day basis in reality.
Social
Games progressed from being predominantly single-player to multiplayer and massively multiplayer in large part thanks to technological advances that led to online gaming. The rise of esports and live streaming platforms means that there are now many different channels to connect socially through games:
- Online: social media to discuss games, live streaming, and other user-generated media, online multiplayer gaming, as well as audio and video chat while playing these games
- Offline: playing video games with each other offline, esports events
Trends
These four aspects can again be identified in the major announcements at the 2019 Game Developers’ Conference (GDC):
- Launch of a new Oculus Rift headset (Simulation — VR)
- Unreal Engine (Simulation — a game engine which renders graphics)
- Google Stadia (Accessibility, Simulation, Social — cloud gaming and live streaming)
In line with these trends, we can expect games in the future to continue to become more accessible, more visually stunning, more complex, and more social. In other words, expect virtual worlds to become more immersive and accessible than ever before.
So, why do we play video games?
In many ways, the core factors which motivate us to play video games are quintessentially human.
1) Escape
Video games, like any other hobby, are a form of escapism. The most fundamental reason we play video games is because of its addictive gameplay. When we play video games, we are completely focused and immersed in the game. While there may be other factors such as visually stunning graphics which keep players engaged, we know anecdotally that even simple, unsophisticated (-looking) games like Pac-man can be addictive with a well-designed game loop.
A well-designed game can help players enter a state of flow — they lose track of time and focus only on the task at hand, which is to play the game. This state can be attained in any sufficiently engaging hobby or activity — athletes often enter a state of flow when competing. The addiction that players feel when they play a game is strongly correlated with this state of flow. As game developers made better games with more complex feedback loops, they became experts at getting players into a state of flow. While in a state of flow, players can ignore their burdens, even if only temporarily, in the real world.
2) Competition and achievement
The desire to be good at something, to compete, and to win runs deep among human beings. Video games provide an alternative medium through which people can compete and acquire fame. The hypothesis that people play video games because they enjoy competition is backed up by research which found that the “challenge” of beating the game or other players is what drives players. This is further supported by the booming esports industry: there are expected to be 2.7 billion active gamers worldwide by 2021, and the global esports audience is expected to double in the next 3 years from 300 million to 600 million.
3) Social
Gaming is and always has been a social activity. Gamers have always liked to compete, play with, and discuss games with their friends. Although it may not be the most important reason for playing a game, the social aspect of gaming provides an important source of motivation for video game players to continue playing. New ways of interaction through live streaming and esports keep players more interested and engaged with the video games they play.
In-game communities provide a different social experience by allowing players to connect with each other in-game with their virtual personas, which may differ significantly from their real-world personas. Players of MMORPGs in particular often cite the experience of being able to be a part of a large, geographically-distributed, like-minded community as one of the most enjoyable parts of playing the game.
Video games are games
You might notice that all 3 reasons listed above can also apply to normal games such as sports or board games. Take the sport of football as an example.
- Escape: football players enter into a state of flow when they compete
- Competition: football, as a sport, is inherently competitive. The biggest football competitions are prestigious tournaments with large global audiences; the FIFA World Cup is one of the most viewed spectator events in the world with 3.5 billion viewers
- Social: fans of football play football with other players, watch football on TV or live in stadiums with their friends, and play football video games with each other
The reason for this is that video games are games. They fulfill similar purposes to other games and hobbies in society, and therefore the fundamental reasons for playing video games will not differ from that of other games.
What makes video games different from normal games/hobbies?
Two things — the internet, and simulated interaction.
Normal games are bound by physical constraints such as geography. This affects the temporal aspects of the game as well. For instance, friends who want to play board games or sports need to be at the same place at the same time. The internet allows us to play and interact with gamers from all over the world — no longer shackled by time or space. This allows virtual worlds to co-exist as an alternative to our day-to-day reality.
More importantly, video games offer the unique experience of automated, simulated interaction and feedback. This stems from the inherent nature of video games as a designed environment: everything in a video game is programmed. Each video game is, in essence, a new universe with its own rules. In this universe, the game developers play God by setting the rules, which range from more general topics, such as the strength of gravity, to the most minute of details, such as the speed and sound of the wind. This is in stark contrast with reality, where instead of making rules, we have to adhere to the underlying physical rules of our universe.
Video games offer an unparalleled level of escapism and immersion by recreating our physical reality in the virtual domain. At the minimum, they can help people to relax and recharge. At its best, it represents a second chance: providing a haven for people who don’t feel at home in the real world, or who have been dealt a bad hand by life.
Video games as a Trojan horse for the development and adoption of the virtual world
As we have seen with Spacewar, video games serve purposes other than just entertainment. Windows PCs in the 1990s came with addictive games like Solitaire and Minesweeper, but their true purpose was to teach users how to use a computer mouse. In the same way, video games may function as games for enjoyment, but we believe that the true purpose of video games is instead:
- For game developers to learn to develop realistic and engaging virtual worlds
- For gamers to be accustomed to living and exploring in virtual worlds
There might be games for which this does not appear to be true. Simple puzzle games like Puzzle Bobble might not fulfill any purpose other than as a brain teaser for bored minds. But even these games share the property of simulated interaction. When a player shoots a bubble, they are constrained by the walls, timer, and color of the bubbles: rules of the Puzzle Bobble game world. Each game, even the simplest one, even Spacewar, is its own universe with its own rules. Every game ever created counts as practice for game developers to create simulated, interactive environments for humans to play in. The engineering expertise acquired from developing and deploying these games is built up over time, eventually allowing us to create virtual worlds sufficiently immersive for us to live in.
More complicated games like MMORPGs explicitly model and create a game universe in which players are represented by their avatars. In these games, players can behave exactly like how they do in real life, in the game. They dress up, make friends, meet lovers, battle, buy, trade, and sell items and properties, and explore new spaces in the simulated game world. The complexity of these games is such that even game developers themselves fail to anticipate all the consequences of the rules they set (read: emergent gameplay). An example of this is the phenomenon of combat pure in Runescape. Emergent gameplay increases the realism of the game and helps to immerse players into the game world.
Yet, even in simpler games like Candy Crush Saga, which have simple, puzzles-based core gameplay, players get familiar with and learn to value items in a virtual setting through the collection and management of virtual items (in Candy Crush, users collect and manage different types of jellies).
Many people envision a world like Ready Player One: a dual world where the virtual and real co-exist. Indeed, we are already halfway there: research from Stanford has shown that qualities that players acquire online through their interactions in the game, such as confidence or insecurity, can spill over to real life. In such a world, where the virtual is real, virtuality must take on a new meaning: an alternate reality where we are unbounded by the physical constraints and burdens we carry in the real world we live in. As access to the internet becomes cheaper and more widespread, the virtual world provides a viable second chance for people who aren’t satisfied with their lives in reality —a new (virtual) land of opportunity, a medium which allows people to seek out what they’re missing in the real world, a tool for leveling socioeconomic inequality. While we may not live in such a world yet, there are promising signs that a large portion of the 2.2 billion gamer population has already taken significant steps in that direction.
Who We Are
Everest Ventures Group (EVG) is a fintech startup established in 2018 as a spin-off from AID Partners, a leading private equity firm in Hong Kong. EVG’s investors include billionaire family offices and top firms and funds around Asia, and its strong network in Asia is complemented by strategic global partners in the US, the UK, and the Middle-East. The team behind EVG comes from all over Asia with a proven track record on a variety of blockbuster deals ranging from traditional tech and entertainment deals, such as Legendary Entertainment, Dave, and Zoox, to digital assets like Telegram, Bancor, and Gifto.
One of EVG’s main goals is to help democratize finance. To that end, we have launched Izumi, a digital platform that empowers everyday investors to participate and trade institutional-grade investments. Izumi’s offerings include thematic funds across a range of different verticals such as autotech, AI/Robotics, and Japanese B&Bs. Gaming/esports is a vertical that has been exhibiting strong growth, and one which Izumi is giving serious consideration to.
