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More AAA-Studios will be Bought for Absurd Cash Deals in the Next 3 yearsby@max-albert
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More AAA-Studios will be Bought for Absurd Cash Deals in the Next 3 years

by Max AlbertJune 15th, 2022
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Gaming is at its most pivotal time in history. Understanding how the market is getting tighter, adapting to crypto, more inclusive, and more aligned with advertising is going to be key for success in the gaming space.

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What is the Current State of the Gaming Industry?


Gaming is at its most pivotal moment in recent memory. On the one hand, mobile gaming revenue declined in Q1 2022 (though still up more than double since 2018), and 80% of smartphone users have already downloaded a game on their device--this shows the gaming industry has “grown into its shoes”. Eclipsing movies, music, and television in marketshare.


The question remains… can gaming grow even higher? Experimental forms of gaming such as metaverse, crypto gaming, educational games, and advergames have shown incredible promise. In one study by Deloitte, 82% of players that attended an in-game event in the metaverse bought a product as a result. This has advertisement agencies drooling at the mouth to pour money into metaverse events.


Time will only tell to see if gaming could expand beyond its 250b marketshare, but I am certainly optimistic!


The Positives and the Negatives of The State Of Gaming:

Positive: Gaming is Becoming More Inclusive

One big positive change for the gaming industry is that it’s becoming more inclusive. There has been a spotlight shined on Blizzard Entertainment for its unfair treatment of it’s female employees. Raven Software won a union for better working conditions for its workers, especially quality assurance workers.


There seems to be a big push to help support BIPOC and female game studio founders. The progress is slow but important.


Positive: Venture is Dropping Massive Checks Into Gaming


Also, there is an explosion of capital available for entrepreneurs looking to make their mark on the industry. This is most pronounced by a16z’s announcement of GAMES FUND ONE, a massive pile of capital looking to invest in games, game support, and web 3 gaming.


Positive? Gaming Tends to Do Well In Bear Markets


Lastly, and this may be a little contrarian, I’m actually excited that we are headed into a bear market. Gaming has long held a certain resilience to recession economies in ways that other entertainment industries have not. Gaming performed great during the housing crisis of 2008, and absolutely exploded during the Covid economy. While I would never wish for a recession because I understand the implications from a human level, the businessman in me is curious to see if gaming will continue to be the safe haven for entertainment investment--perhaps drawing even more investment than it otherwise would.


Negative: Play to Earn is Entirely Misunderstood by the General Populace

One problem in gaming right now is that investors and the public do not understand the strengths and weaknesses of Play to Earn.


Alexis Ohanian needs to pull his investment out of Skyweaver and into a better Play to Earn gaming model ASAP--perhaps MEGAFANS! Not every game genre lends itself well to crypto. Back in 2018 I wrote an article about how Hearthstone “solved” card game monetization problems by doing the opposite of what crypto games do. If Alexis read my article, I could’ve saved him a helluva lot of money!


With Axie Infinity also tanking, I hope that investors, developers, and the community at large catch onto the fact that not every game genre is well suited to play to earn, and we should stop building play to earn models that are doomed from the start.


Negative: In-app Purchases are Unethical and We Need a New System!


One more thing, the most lucrative money-making methods in gaming is through mobile in-app purchases specifically on the iOS AppStore. But these monetization practices are typically unethical--addicting players and tricking them into paying much more then they can afford. We need a new lucrative monetization strategy. Perhaps crypto is the answer!


What Piece of Gaming Tech do you Like the Most and Why?

Advergaming is on the rise. Companies are now starting to realize that the best way to invest in gaming from an advertisement perspective isn’t to throw a banner up on Frameplay.gg, or to sponsor an eSports team but instead to hire a game studio like Gamify or AppStop.io to build a bespoke game around their product. The results are nothing short of incredible. AppStop.io has launched several top 100 iOS hits for various brands and has shifted public opinion of those products by up to 92%. The reason why I like advergaming most is because it’s so cutting edge, companies and investors are going to be able to innovate in this space for the next two years with very little competition.


What Piece of Gaming Tech do you Think is Lacking?

“Lacking” is the wrong word but I believe Metaverse products have unrealized potential. I had a viral tweet the other day when I said “Whoever rebranded ‘MMOs’ as ‘Metaverse’ is a goddamn genius.” The ethos behind that tweet is this: World of Warcraft is perhaps the best Metaverse product ever invented and it launched in 2004. To this day it’s still the most played and most lucrative metaverse product.


It will be interesting to see if Yuga Lab’s new Bored Ape MMO will be able to dethrone World of Warcraft. I believe they are doing the right thing by playing in the MMORPG space as opposed to the sandbox MMO space like Roblox, however they have big challenges ahead of them. Their total budget is a mere 450m which is pennies in the MMO space. For instance Facebook just dropped a cool 4.3b on their Metaverse project and it’s hilariously ill-equipped to garner a return on that investment.


Pay attention to rec room. This VR metaverse game is the closest thing humanity has to Ready Player One and seems to be doing quite well. My insider sources tell me that they have a big problem with churn but if they’re able to figure out their engagement issue, I’d bet on them winning the long-term metaverse space over Facebook’s reality labs.

Lastly, What is the Future of Gaming? Where is the Industry Headed?

I’ll make a few predictions: