Blockchain Erodes the Competitive Attention Economy for Video Games

By injecting True Ownership into blockchain-enabled video games, game studios no longer have to compete for the attention of players in traditional ways. Studios can generate revenue even when players aren’t playing their games.

Make no mistake, developers build games to make money.

We all have a little Wario in us. Even game developers.

And there is currently only one way to make money: compete for players’ attention. This is a very basic problem that every studio understands. Designers build addictive gameplay mechanisms to attract new players and sticky economics models to keep existing players from leaving.

Try as they might, game makers will never succeed in achieving a perfect retention rate. There will always be competing places for players to redirect their attention: other games, social media, even the real world 😳

The attention economy has always been this way — absolutely binary: either players are focused on your game, or they’re not. And only when players are focused on your game do you even have the opportunity to earn money (with merchandising streams being a rare exception). The marketplace is ferociously competitive and rigid.

Game developers are in as fierce a competition with each other as the characters in the very games they create

This fundamentally changes with blockchain. Blockchain disrupts the traditional attention economy entirely by transforming virtual economies into marketplaces where designers can generate revenue from players even when they aren’t playing their games.

How?

Blockchain-enabled gaming assets follow players wherever they go. This is significant because three of the most common opportunity losses for game developers are:

• Secondary Markets — when a player exits the game to “illegally” buy and sell in-game items instead of purchasing them from the studio directly
• Other Games — when a player simply plays a different game
• The Real World — when a person spend their limited expendable income and time on things they need or enjoy in their real life

What do these three opportunities sinks have in common? They are manifestations of the same function: players left the game. And this is a problem because when players leave games, developers loose their only opportunity to generate revenue.

A game developer’s last ditch effort to keep you around… please don’t go!

When a blockchain asset is able follow a player wherever they go, it means game developers can extend their game — and, therefore, their opportunity to make money — into secondary markets, other games, the real world, and beyond. For such radical extendability to succeed, a new paradigm of gaming revenue models needs to be explored.

Programming Passive Income

Extending games and earning passive income is only possible when a studio makes the decision to tokenize their game’s virtual assets using blockchain. Terms and conditions can be programmed directly into tokens by studios to (1) enable players with True Ownership to do with their digital property as they please, and (2) apply remittance fees to any value generating behaviors made by a player with an item.

Value generating behaviors include any action taken by a player to create wealth. These actions may include buying, selling, renting, sharing, loaning, pawing, collateralizing, importing, exporting, burning, and spending digital currency and assets.

There are endless ways for players to generate wealth from their favorite games

Every time a player engages in one of these economic activities, it is possible for the studio to earn a profit. For each one of the previously mentioned opportunity losses, here is an example of how the studio could make money even when players aren’t playing their game:

• Secondary Markets — Bob meets Alice on a forum. Bob is going on vacation next week and Alice asks if she could borrow Bob’s rare sword while he’s away. Bob agrees and proposes a $5 rental fee. Alice accepts the offer and the studio earns $1 from the transaction.
• Other Games — Cameron decides to play a new medieval game. He wants to bring a rare, expensive spaceship from his current game into a world of kings and queens. The medieval game allows Cameron to import his $50 spaceship and augment it so it renders more appropriately as a powerful trebuchet for a $2 one-time fee. Cameron pays for the upgrade, and the original space game earns a $0.25 import tax+ 5% of all profit generated by Cameron’s trebuchet in the medieval game in perpetuity.
• The Real World — Diana raids a village one night with her guild, earning her a heavy supply of digital loot. The next morning Diana walks to her local coffee shop and purchases a chai tea. The tea normally costs $3, but Diana uses her in-game loot which comes with a light premium. Diana pays $3.50 and the extra $0.50 goes to the studio.

In each one of these scenarios, the player left their original game, did whatever they wanted with their True-Ownership-enabled items, and the studio earned a profit — even while the players weren’t playing their game.

Counterarguments

Many studios will still argue that opening their economies to secondary markets and other games will cost them more money than they’d earn if they could instead retain players and remain the sole digital shop for their user-base. While this may be true in a number of cases , there is no denying the fact that opening a digital economy to the real world has nearly unlimited potential.

It is not uncommon for even causal, but dedicated players to organically grow accounts to a fair market value of $5,000 to $10,000 — especially when a player is an early adopter of a title that later becomes wildly successful, like Fortnite. Five to ten thousands dollars is, in many places in the developed world, enough money to make a low-end downpayment on a mortgage to purchase a home (and, actually, in even more places in the world you could outright buy a house with $5–10k).

If a player could collateralize their in-game assets for that downpayment, the studio could arguably justify charging a 2–3% fee of the total $5–10k digital asset deposit. This unlocks an entirely new revenue stream for games, which would not compete with the game, itself, in the same way secondary markets and other games might.

Letting players buy a home with the digital assets from your game doesn’t have to be so scary… especially when you can earn some coins in the process

Want to find out how we’re transforming the world of gaming?

💻 Check out our website
👨👩 Learn more about our team and advisors
🎮 Play our game, the first proof-of-concept of Plasma MVP — Plasma Dog.
👫 Join us on Twitter, Discord, Reddit and Facebook
🎬 Watch our introductory video
📝 Go to our blog
👩‍🎓 Read our knowledge base
📃 Read our crowdfunding paper
✨ Sign up to receive updates