

Zyngapocalypse Now (And What Comes Next?) - irunbackwards
http://techcrunch.com/2012/08/04/zyngapocalypse-now-and-what-comes-next/

======
balloot
The fundamental problem with Zynga products is that they're not games. The
fact that they famously concentrate on "compulsion loops" and forming habits
in their users tells you all you need to know. No real game has to focus on
the compulsion to play - they just make the core game experience great so you
come back. Not to mention that compulsion loops require user gratification,
and there's only so much gratification you can squeeze out of harvesting
digital goods.

The one notable exception is Poker. Poker is an actual game, and not
shockingly it's the Zynga product with the most profitability and longevity.

~~~
jay_kyburz
I wouldn't go that far. I would say a game like Diablo is basically just the
same kind of "compulsion loop". Just done better. :)

~~~
robryan
One difference with Diablo is that I can stop playing for a month and then
come back to the game. Most of the social games are trying to encourage
constant interaction, if you don't harvest your crops today they will die etc.

WoW was/ is somewhat like that, if you wanted to get the best gear/
achievements in the game you would have to play many hours daily to keep up
with points, clear the top level raids etc.

~~~
stan_rogers
That's why I never got into any of the Zynga games on FB -- they had the
strong scent of Tamagotchi (now with extra spam!!!) about them, and I just
can't see the faintest promise of pleasure in keeping a digital pet alive, no
matter how they're painted. If that makes me weird, then I shall continue to
be one with my weirdness.

~~~
robryan
Yeah, their definitely is a personality type out there they can target though.
When younger I put a lot of time into WoW although I never played Zynga games
past the initial novelty, nowhere near enough depth.

Now that I run my own businesses I am definitely after something I can pickup
when I have a bit of time and not have it become a chore.

------
richardjordan
The bogus business model of in-game purchasing needs to be called BS on too.
Yes I know it works in other countries, but that's usually in intense games
where the engagement is high and long term.

My household probably counts as a high dollar in-game purchasing one. We
probably boosted the numbers of some game developer.

Reality: a kids game had a $99 purchase option for hearts on the screen and my
then 7-yo daughter not really understanding this was real money, spotted her
mom putting in her password for App downloads and copied it to make about $400
of in-game purchases. This is nothing but a scam. There's no legitimate reason
a game targeted at that age-group has a $99 purchase option other than to try
to trick kids into spending money they don't know is being spent.

As the OP says - the quality of their product is terrible and once novelty
wears off, apart from a few people with addiction issues their business model
collapses.

Hate Zynga. Hate Groupon. Hate that they made such a big splash as tech IPOs
yet will ultimately crash and the harm will spread to tech startups in general
as the markets learn to distrust tech IPOs again.

~~~
dominostars
Right now 17 of the top 20 grossing iPhone apps are freemium. Are you
suggesting that these apps are only able to succeed because of accidental
purchases?

~~~
jquery
I would argue they are succeeding due to greed and ignorance, the likes of
which will necessarily cause a crash and hopefully subsequent rebirth of true
gaming.

~~~
cageface
The consequences will be more widely felt than that. Right now mobile gaming
pretty much _is_ the commercial mobile app market. When that implodes it's
going to take the rest of the app market with it, at least temporarily.

------
mikebabineau
(disclaimer: I'm ex-BioWare/EA and work for a[n awesome] gaming startup)

Social games provide tremendous value, just not where most people think. It's
not the "social" features, it's the ease of access.

"G2" is not about delivering better social games. It's about delivering "real"
games in the browser. If instead of downloading and installing an 8GB package,
you could play Diablo 3 by simply going to a website, would you ever choose
the former?

iTunes revolutionized music delivery, just like Steam did for games. "G2" is
about going one step further. Think Spotify. The same [quality] games you'd
download and install will instead be instant-on and resumable from anywhere.

Facebook and Google+ get it. That's why Facebook developed App Center (to
showcase top-quality games), and why Google+ is putting so much effort into
Native Client (Bastion, anyone?) and Play.

Adobe gets it, too. They're doubling down on Flash development. Stage 3D gives
you GPU access - this means 3D in games (see trailer:
<https://www.rumblegames.com/kingsroad> \-- disclaimer, I work here, and let
me know if you want beta access: mike.babineau@rumblegames.com).

Zynga understands delivery. But could they build a quality game? This takes a
different approach to game design, and serious investment into a 3D pipeline
and rich game tech.

BioWare, Ubisoft, and other big-name studios understand how to build quality
games. But their games are delivered through traditional channels. They need
to shift from box products (and from current "digital delivery") and figure
out how to build and operate what is essentially highly scalable web tech, and
how to operate games as services.

I agree with the author: the companies best positioned to deliver "G2" are a
new breed. Look for hybrid teams, people who have built traditional games
alongside those who have built high-scale web platforms. This is what will
turn the entire industry on its head.

~~~
chucknelson
"...will instead be instant-on and resumable from anywhere."

Haven't OnLive and Gaikai already accomplished this? The main criticism of
those services is lag, but for future mainstream games, social and otherwise,
the player probably wouldn't notice.

------
Apocryphon
If all of the anti-hype (the FUD?) about not just Zynga but companies that
pump out AAA games in general, video games in general is heading for a crash
not seen since the days of Atari. Fortunately, with the advent of Kickstarter,
indie and Eastern European (and other non-American) studios, there will still
be plenty of cult classics that will appeal to more hardcore and niche gamers.

~~~
balloot
I still don't see how people can equate Zynga with the game market as a whole.

The "Ville" products are not games. They don't reward skill, you can't win
them, and they don't offer any fulfilling multiplayer experience. Most real
games fit one or more of these attributes.

Zynga products have more in common with cigarettes than something like
Starcraft. Both of the former offer a not-terribly-fun experience that has
been thoroughly optimized to provide maximum compulsion and habit. The other
is made for entertainment and draws its value from people enjoying this
entertainment.

~~~
Apocryphon
I'm not saying Zynga is the same as EA, though the impending implosion of
mobile/Facebook-based social games seems to match the possible implosion of
the console game market as well [1]. It's a separate phenomenon, but they seem
to be coincidentally happening at the same time.

[1] [http://www.theverge.com/gaming/2012/7/2/3125866/the-state-
of...](http://www.theverge.com/gaming/2012/7/2/3125866/the-state-of-games-
state-of-aaa)

~~~
fscof
MMOs don't seem immune from this either:
[http://www.dailyfinance.com/2012/08/03/activision-
blizzard-t...](http://www.dailyfinance.com/2012/08/03/activision-blizzard-
treads-water-as-warcraft-burns/)

[http://www.examiner.com/article/star-wars-the-old-
republic-s...](http://www.examiner.com/article/star-wars-the-old-republic-
subscription-drop-to-less-than-one-million)

Seems like the gaming industry is all over the place right now.

------
jay_kyburz
This is super exciting to read.

I've been building small web based "social games" for a few years now, none of
which look or play like the games of these big publishers.

I think the core mechanics of social games have to be about bringing players
together and encouraging them to interact.

I've been trying to self fund everything so far, but things are moving very
slowly. I wonder in the turmoil whether I should seek investment and go big.

~~~
saraid216
The obvious question is, "Will it scale?" I admittedly don't have the patience
to click through to your stuff and evaluate it myself, but if you think you
can handle it... I imagine the trick would be to convince an investor that
Zynga is creating a vacuum that needs filling.

(Also, grain of salt. I do not actually have any relevant experience. But if
your stuff actually makes social games look good, I applaud that all by
itself.)

------
Nate75Sanders
They're hiring right now in Seattle (Pioneer Square). I work one floor above
them and one of their recruiters sent both me and another engineer on my team
an email (the same email) just a few days ago mentioning that they were right
below us.

Strange timing given their stock falling.

~~~
vecter
In August of 2008, I was a senior in college and went to our school's
engineering recruiting barbecue. There were a lot of finance firms, including
Lehman Brothers in all their glory. I remember walking to the booth to ask if
they were recruiting, and the well-spoken congenial lady gave me a warm
genuine smile and said, "yes!".

Two and half weeks later, they declared bankruptcy.

------
RoboTeddy
I'm working on a game that the author of the article would probably put in the
"G2" category.

I wouldn't normally post a job ad in an HN thread, but the content of this one
is likely interesting to people here: <http://graffitilabs.com/jobs>

"If Minecraft were a little more friendly, free to play, a little prettier and
a little more easily hooked into social networks maybe that would be it."

That quote describes our project pretty well. We're not trying to be
Minecraft, but it's definitely influenced us.

Browser-based games are just getting their start-- I think the future holds a
lot of awesome stuff.

------
comex
> Status is a minority interest in games, and sales of status items tend to be
> small compared to sale of utility items (in cases where both are available).

Funny you should say that - I was just playing TF2, which Valve has called
"America's #1 war-themed hat simulator"... which has apparently been
successful enough with its move to free-to-play, apparently relying mainly on
sales of status items, that Valve will be using the same model for Dota 2.

Of course, both games have solid foundations as actual _games_ , rather than
awkward socializing environments.

~~~
gnufied
I play Dota2 and has never bought or traded any item. Agreed Dota2 will be
free to play, but compared to TF2 - it brings another aspect which is
professional game play and ability to watch it within Dota client.

I am not sure, how much money valve will be making eventually but they are
already selling tickets for watching professional games within Dota client. I
think once it comes out of beta, selling tickets of professional games is a
element we can't ignore. remember nearly 40-50K people turn up to watch any
competitive dota2 game.

~~~
xentronium
> remember nearly 40-50K people turn up to watch any competitive dota2 game.

Only while it's free. I doubt that they will start charging money for
professional games, simply because no one does that. The only actual advantage
of DotA 2 against other MOBA games (LoL, HoN, DotA1) are tournaments with huge
prizes ("the International", $1M for first place lots of lesser ones). It's
not like DotA2 is so much more interesting to watch than HoN/LoL.

------
michaelochurch
Excellent article. Spot-on.

"Social games" are the least social variety of game that has existed over the
past 5,000 years. They're even less social than typical video games. With
console games like _Final Fantasy 6_ there was, at least, the process of going
to school and talking about the game with other kids. There was a social
"meta" game. _Magic_ had a similar metagame that was deeply social: you had to
engage with other people to figure out what strategies people were coming up
with and what the new deck types were. Zynga games don't have that because
almost no adult would ever admit to wasting 5 hours per day on _Farmville_ ,
because it's just too damn embarrassing.

These "social games" exist to generate addiction without content. As peoples'
immunities build, that's going to become increasingly fruitless from an
economic perspective. And the only thing "social" about them is that they
market themselves through social networks. Zynga is, in essence, Facebook's
tapeworm. It's also, in my opinion, responsible for a large fraction of the
"social network" fatigue that's setting in now.

There was a (failed, alas) proposal at Google to focus on high-quality games
for Google+. It was called the Real Games (or Excellence in Gaming)
initiative. The idea was that we'd support independent designers who'd give us
quality games, instead of publishing the dreck thrown at us by mainstream
publishers. We'd have the developer code up the game logic and UI, and we'd
take care of web-scale, player matching, and analytics. (We'd also be able to
provide a platform for playtesting, which is a major limiting factor for
amateur game designers.) I wanted to focus on German-style board games, the
best social games (e.g. Apples to Apples), 2D "retro" RPGs, and the most
innovative casual games... but inevitably we'd cover the whole space.

The business logic was as follows. Every social network needs to start off
seeming upscale, but "upscale" on the Internet has more to do with content
quality, intelligence, and in games, NFC (need for cognition) than economic
status. Facebook had a huge high ground because it started in the Ivy League.
Google+ needed something similar. Providing an extremely high-quality platform
for excellent games that can't be found anywhere else would give us this.

We could also integrate these games with Hangouts and make the experience
genuinely social. I'm obviously biased, but I think this was one of Google+'s
biggest missed opportunities of 2011.

Also, in mid-2011, Facebook's brand was damaged (more than it is now) by these
games, due to the game spam problem. Facebook had actually fixed that by then,
but reputation is always a lagging indicator and we had a great opportunity to
use this to brand ourselves in the wake of the first signs of social network
fatigue: "We Won't Waste Your Time With Shitty Games".

You've probably never heard of Google+ Games. That's a good thing. The higher-
ups ignored Real Games and took a "Me, too" strategy that failed.

Taking a broader perspective, I've thought a lot about the social space and
about games, and I think the fundamental way in which these networking
products are undeserving people is that there's no focus on improvement. The
space seems to be all about documenting _what is_ (and selling the data to
advertisers) but very few (Meetup is an admirable exception) are actually
trying to _improve_ the social theater and _expand_ the network. The next
great social network and the next great game platform will be ones that
improves human interaction in creative ways that few people had ever thought
of.

~~~
nekojima
There are very successful Japanese and other Asian gaming companies on other
networks and for mobile which could have been noted as alternative examples in
the article. They seem to provide a better gaming experience for their users,
though its not much removed from the Zynga model, there does often seem to be
a higher quality to those games.

For myself, I'd much rather play games on Brettspielwelt* than supposedly
social games on FB. The level of play is much higher, its MP with chat, and
the strategy games are amongst the hardest boardgames available. Many games
can be played in 15-60 minutes and there is no sunk cost or dying crops to
force you to continue playing or returning every six hours.

* www.brettspielwelt.de (available with English interface)

~~~
michaelochurch
Brettspielwelt seems cool, but I don't think chat alone quite brings us to
being "social". For all the "hardness" of German-style games (and they're
actually not that "hard") they're also quite social. That, I think, is the
brilliance of the best Eurogames. They're complex enough to deliver
interesting play for the high-NFC crowd, but they're simple enough to still be
credible social games. They're non-trivial and involve some teaching time, but
they're designed to be played by families.

Google+ Hangout integration with the German games, and with the well-designed
social games like Apples to Apples and Great Dalmuti, and with typical card
games (Hearts, Spades, Ambition) would have been totally badass. Not only
would it have made online gaming actually social, but it would have given
people a reason to use Hangouts (which are cool, but never caught on because
they didn't have a draw, and games could have been the draw).

What I really wanted was to engage and empower the developer community. Right
now, developing a new board game is very hard. You have to print a scrappy
prototype and find people willing to play it (play testers). It takes several
hundred hours of testing to balance a non-trivial game. This is a major
barrier to entry for game development, and in the age of cloud computing and
analytics and video chat, there's no excuse for it to be that way. No reason
to limit this to German-style board games either; we could have also engaged
2D "retro" gamers and eventually supported MMORPGs. We'd probably want to stay
away from the forefront of graphics, but no reason we couldn't have delivered
excellent game play.

But... upper management wanted to give preferential treatment to mainstream
publishers, and the result is that Google+ Games flopped.

~~~
gbelote
If you're a fan of Settlers of Catan, my previous startup built a clone with
integrated video chat: <http://gameroom.io/>

Our goal was to build a social place around board games and video chat. The
video chat was to make it feel like you were with the other people, in the
same room. We fell short in a few ways, but it's still live if you want to
play with friends!

------
KaoruAoiShiho
_IT’S NOT REALLY ABOUT STATUS Much hay was made back in the day of the value
of virtual goods and status, leading to large projects like PS3 Home and
Second Life, as well as cosmetic items in many virtual worlds. There was a
time, indeed, when many developers were thinking that status items were all
they would sell. They missed the point on this by a large margin.

Status is a minority interest in games, and sales of status items tend to be
small compared to sale of utility items (in cases where both are available).
Most players do not spend that much time on their avatar, do not really care
that much about how their virtual house is arranged and when they realise that
the rest of the world does not give them social proof, stop buying status
items altogether.

This can be confusing to understand because in games like pet simulators it
seems as though much is spent on cosmetic items. However it’s important to
note that a cosmetic item can also be a utility item (for example: to increase
my pet’s happiness I must buy flowers etc). A status item is one that has no
utility other than allowing the player to be a little creative or show off._

But Hats?

------
vinayan3
Great article. Did anyone go to google finance and notice that Zynga took out
a 100 million dollar loan? [http://www.businessweek.com/news/2012-07-30/zynga-
gets-100-m...](http://www.businessweek.com/news/2012-07-30/zynga-
gets-100-million-loan-financing-for-corporate-purposes)

Have they blown through a ton of cash and are worried about dipping into their
reserves?

~~~
trimbo
Wow. That's really interesting news. They raised $1bn in the IPO. Their
current assets have dropped from $2bn at the time of the IPO to $1.4bn today
-- so half a year. Balance sheet:
<http://www.bloomberg.com/quote/ZNGA:US/balance-sheet>

[edit] They did buy their HQ though for $250MM, which explains some of the
transfer of short term to long term assets.

------
BaseBand
They just need to bring back all the BBS based games.

------
cageface
_In fact my theory was that social games could slide into the same death
spiral that Ataridid in 1983... It will also probably happen to handheld
gaming soon._

I _strongly_ suspect the mobile gaming fad on smart phones is going to burn
itself out sooner rather than later. There's just too much gimmicky crap on
the market and, just as in previous gaming fads, this kind of ecosystem strip-
mining is eventually going to alienate the gamers.

------
Tiktaalik
A while ago when they were opening up new studios and hiring talented people
from the games industry (eg. Brian Reynolds, ex-Civ2, Alpha Centauri) I
thought they were going to move to the next level and create games that would
be more engaging to a traditional games audience. We haven't seen that at all
however.

I wonder if there is frustration from folks they've hired from the traditional
AAA console games industry.

------
aymeric
Well written, great analysis.

