Gamasutra
By Robert Levitan, Pando Networks CEO
Full Article
In January we all saw something pretty amazing. An incredibly effective online protest, organized by websites and online companies large and small, changed the course of American politics. Even with companies as massive as Google involved, the entire effort came together in a very “grassroots” manner, without any central organization or marching orders. The Internet just did what it does best: spreading a message through social media and its tightly knit communities, and conveyed that message on a scale nobody had seen before. I don’t think any of us, least of all the US Congress, saw it coming.
The legislation that got us all up in arms, of course, was SOPA, and its twin sibling, PIPA. Creators, providers, and consumers of online content saw danger to more than just our livelihoods: SOPA represented a threat to the way of life we had developed through the internet. Together, we spoke out using those same tools and sites that were on the chopping block, and convinced even the bill’s sponsors to back down.
While this is an incredible achievement that we should all be proud of, we shouldn’t let the issue fade into memory just yet. It’s important to take a closer look, recognize what happened, and prepare for what’s likely to happen next.
When I got involved in online business 17 years ago, the Internet was a different place. Working in such a young medium meant that politics hadn’t yet entered the picture. We were all still discovering what could be done with the Internet; regulations hadn’t yet been considered because nobody knew quite what to regulate. That environment instilled us all with a refreshing sense of freedom – freedom to take risks, implement radical and untested ideas, and share content of every kind. It provided us with a level playing field, where the best ideas, best technology and best business execution could create large, innovative and disruptive businesses. This true meritocracy helped nurture companies such as Netscape, Yahoo, Google, eBay, Skype, PayPal and many others.
We grew accustomed to certain creative and business freedoms, and reveled in the power these gave us over the direction the Internet was taking. We didn’t need or want politics to enter the picture; we were building a new business world on a foundation of new technology, far removed from traditional business and politics. Most of us actively avoided getting involved in lobbying and regulation efforts. We had built this powerful engine using our technology and forged a deep connection to our users. So, when politics inevitably entered the picture, we felt obligated to defend those technologies and those users.
The fight against SOPA clearly demonstrated the new power that is held by our Internet community, not just by the major architects and technology pillars like Google, but also by non-profits like Wikipedia, communities like Reddit, and hundreds of smaller sites and end users willing to band together under a common cause. This was a good “win” for our side.
However, it’s important to recognize that while SOPA may have been misguided and poorly designed, piracy is still very much an issue, and the major forces behind traditional media creation, such as the MPAA, RIAA, and others, are still very concerned about it. Those concerns aren’t going to go away and we can expect those industries to keep putting pressure on the government to do something about the issue. SOPA and PIPA may be temporarily off the table, but there’s a good chance they’ll be re-evaluated, re-written and brought before Congress again.
Those of us who consider ourselves citizens of the Internet have shown what we can do to stop legislation that could harm us and our end users. Now, it’s time for us to use that same power and drive in a proactive way. Like it or not, the political game has caught up to the online world, and we’re all starting to realize that we can’t afford to sit on the sidelines and be reactive.
Our next move, instead, ought to be some legislation of our own, or in collaboration (if possible) with content owners, demonstrating our own commitment to combating piracy while maintaining the freedoms we’ve come to enjoy and expect online.
We’ve shown the world that we are passionate about online issues, and that we have the power to affect them on a grand scale. Let’s use that passion and power to tackle this problem in a responsible way and ensure a bright future for the Internet.
Gamasutra
By Robert Levitan, Pando Networks CEO
Full Article
It's time for a New Year’s resolution to start off 2012 on the right foot, and I've got a great one for traditional MMO game publishers: Make this the time when your company embraces the free-to-play (F2P) business model. Recent sales data makes it clear that the old staples of the game publishing world (i.e. box distribution, subscription models, and pay-to-play) have been on the decline for some time.
On the other side of the fence, F2P gaming is only growing stronger. Last month, our company published a study of F2P game distribution using Pando Media Booster, and the recent growth has been staggering. In the last two years, the number of gamers worldwide downloading F2P games via our platform has gone up 450%. In some territories, the growth has been incredible -- in Latin America, we've seen growth of 595%. During 2011, 38 million people downloaded a free game using Pando’s services, and we’re hardly alone in our success. Look at the rest of the MMO landscape, including publishers not working with Pando – World of Warcraft started offering freemium content last year with tremendous results, and when DC Universe Online shifted to the F2P model, the response was so immense it brought the servers down.
Obviously, for those of us in the F2P business, this is fantastic news. Growth like this represents a huge opportunity for game developers and publishers. It also signals potential trouble for the traditional pillars of the industry. Overall game adoption and population did not significantly rise in 2011, which means a lot of those new recruits into the F2P fold were traditional gamers, migrating to the F2P model and leaving their old buying habits behind.
The old guard is fighting a rising tide, and if you still doubt that this is an industry-wide trend, look back at the biggest game company rising stars in 2011. Who made the big splashes with over $1 billion IPOs this year? Zynga, a company built entirely on freemium content, and Nexon, an early pioneer of the F2P MMORPG model. Where are the new titans of box distribution and traditional media? Who’s the daring upstart clamoring to be the next EA, Activision, or THQ?
These old models aren't going to go away entirely, of course. As alluded to earlier, there will always be a few blockbusters that will shine. It's easy to assert that box distribution is as healthy as ever when you look at record-breaking titles such as Modern Warfare 3, or that the subscription model is just fine when you see Star Wars: The Old Republic bringing in so many players. However, it's important to take the broad view and realize that there are very few EAs and Activisions in the world. Not everyone gets to be the biggest shooter franchise in history, and not everyone has access to the most celebrated sci-fi property in generations. For the rest of the industry, the market is making a rapid shift into freemium, digitally distributed games.
In 2012, smart game publishers need to focus on F2P gaming as a core element of their business plan. Gamers are swiftly embracing digital distribution as their retail solution, vastly preferring a system that lets them browse, share, download and purchase games on their own terms -- you need to make sure you provide that access. Players are making informed purchase decisions through F2P's try-before-you-buy content offerings -- you need to make sure there is at least some portion of your game which is easily available to hook curious customers. Buyers are deciding the amounts they can afford to spend on their games, and more importantly, showing a willingness to spend money long after their initial entry -- you need to offer them that opportunity.
Big breakout titles can also benefit from this advice. Even WoW has seen new benefits by adjusting their business model and offering some free play. Star Wars: The Old Republic may have had an incredible launch, but just imagine how enormous the launch could have been, had they embraced F2P -- as if a million servers had cried out in terror, and... well, you get the idea.
Allow me to make a prediction for the coming year: 2012 is going to be the year that F2P gaming outperforms the rest. Traditional sales are going to keep declining, the physical market is going to wither and shrink, and the companies that see dramatic success will be the ones with a solid presence in digital distribution and a F2P plan for monetization. Here's to another year of incredible growth, and my sincere wishes that you're on the right side of it.
Gamasutra
By Robert Levitan, Pando Networks CEO
Full Article
By now, we all can see that the Internet will become the dominant media distribution platform. We can easily imagine (and expect) that all content will be digitized and distributed online. Every song, every movie, every video game, every software program, every live television event, every business document and more will be instantly searchable and retrievable via a range of connected devices. It will all be magically available to stream or download on-demand through "the Cloud".
This was the dream when I started my first Internet business in 1995. Now, people think it is the reality. And, while we are making great progress towards such a future, unfortunately, we are not there yet. The demand for online media consumption is simply too great and is growing even faster than we can deploy cloud services to meet it.
Because "the Cloud" is on-demand infrastructure that enables many businesses to scale without having to provision hardware, many people believe the Cloud is infinitely elastic. The cloud concept has become so familiar so quickly that it is commonplace to now hear "Just upload it to the Cloud" or "Just download it from the Cloud", as if it’s truly ubiquitous or that easy-to-use.
The Cloud may be elastic enough to meet certain needs, but it’s far from being ready to meet consumer media demand.
By now, we all can see that the Internet will become the dominant media distribution platform. We can easily imagine (and expect) that all content will be digitized and distributed online. Every song, every movie, every video game, every software program, every live television event, every business document and more will be instantly searchable and retrievable via a range of connected devices. It will all be magically available to stream or download on-demand through "the Cloud".
This was the dream when I started my first Internet business in 1995. Now, people think it is the reality. And, while we are making great progress towards such a future, unfortunately, we are not there yet. The demand for online media consumption is simply too great and is growing even faster than we can deploy cloud services to meet it.
Because "the Cloud" is on-demand infrastructure that enables many businesses to scale without having to provision hardware, many people believe the Cloud is infinitely elastic. The cloud concept has become so familiar so quickly that it is commonplace to now hear "Just upload it to the Cloud" or "Just download it from the Cloud", as if it’s truly ubiquitous or that easy-to-use.
The Cloud may be elastic enough to meet certain needs, but it’s far from being ready to meet consumer media demand. Some examples during the month of November illustrate this point, such as last week’s stream of the Republican candidates’ debate on CBSNews.com, during which people were denied online access to the second half of the debate because of bandwidth limitations. The free-to-play release of DC Universe Online by Sony Online Entertainment is another example; that release overwhelmed the game servers, and the release of Call of Duty Modern Warfare 3 caused the Activision gamer social network, Call of Duty Elite, to crash. The common theme of all of these situations is summed up by an Activision executive: "We knew there would be a tremendous amount of traffic. It was a lot more than we anticipated".
Media and game companies have not been the only ones bumping up against online distribution limitations. In July of this year, Apple planned to release the Lion operating system with only digital download distribution, but broadband limitations led to Apple offering two other methods: in-store digital downloads and an install via a USB flash drive. In January 2009, Microsoft had to delay the Windows 7 beta release because the anticipated download demand exceeded the capacity of the MS servers.
All of these events experienced outages or degraded delivery. And this is not just a problem for one-time special events. Have you ever tried to stream Netflix in primetime? Can you imagine what will happen when millions of gamers download new releases and patches of popular MMOG game titles (some up to 16GBs in size) as the video game industry takes full advantage of digital distribution and embraces the free-to-play business model?
We speak of the cloud as being infinitely elastic but it is not. There are physical limitations. Surely, capacity will continue to improve, but many different solutions will be needed to help scale the cloud. More data centers filled with more hardware and using more bandwidth is not the only answer and certainly not the most efficient or green solution. Some solutions might include faster broadband networks, better compression technology, redesigned browsers optimized for media delivery, more efficient operating systems, smarter media players and client-side software that can make the cloud more elastic and allow capacity to scale up or down to match demand.
As more and more devices connect to the Internet, the demand for media delivery will continue to rise at an accelerated pace. I believe online media consumption will surpass industry projections, which were made to date in a certain context that actually is rapidly changing. We may look back at the early decades of the Internet and find there is, in fact, a Moore’s Law for the volume of online data delivered.
Read the article in its original location at http://betanews.com/2011/11/22/the-cloud-isnt-elastic-enough/
Gamasutra
By Robert Levitan, Pando Networks CEO
Full Article
How can a game publisher succeed in a region where getting their titles into gamers’ hands is difficult, or even impossible? Latin America, and Brazil in particular, are cited as a rapidly growing market for games. Nobody is disputing that there are millions of gamers across Latin America, and their appetite for MMOs and other online titles is growing. Just last week, FPS-MMO Operation7 was downloaded over 30,000 times by gamers in Colombia, Argentina, Chile, Mexico, and Peru. Meanwhile, in Brazil alone, gamers downloaded Combat Arms 69,000 times last week.
However, in a recent study, my company Pando Networks analyzed the download speeds and completion rates in 224 countries around the world and Latin American territories such as Brazil, Argentina, and Colombia ranked near the bottom. In the very first blog I wrote here on Gamasutra, I stressed how crucial it was to provide quick and easy downloads in order to ensure the success of an online game, yet getting a game in Brazil will take up to ten times longer and fail far more frequently than getting the same title in the United States.
It’s not my intention to be a naysayer and warn you away from expanding your business into South America. On the contrary, I am bullish about the online game industry in that region. I’ve been in Sao Paolo meeting with game companies. The energy in the air is palpable when local game company executives discuss the growth and opportunity that is possible there. In many ways it’s reminiscent of the early days of the internet and I felt like I was reliving my own start in the online business world in 1995.
Success as a publisher is certainly possible in countries such as Brazil; it simply takes a better understanding of the unique challenges that the area presents, and the right approach to those obstacles.