Up til now I've been talking about games in a very general, abstract sense, because gamification draws upon basic principles that are common to all games. But, it also draws specifically upon a certain category of games, namely video games, and most of the gamification examples that we're going to think about involve online digital systems which are directly related to what we see in video games. So, it's worth understanding the video game industry also because of the size of it, and the scale of it, and the pervasiveness of it, are part of why the motifs of gamification are so familiar. So, we start 40 years ago, 1972 or so, with Pong, the first mass market successful video game, still gives me chills, here it is. Pong was a revolution. There it is. Because it allowed people to interact with what was on their screen. It, by today's standards of course, was unbelievably primitive. And, it's hard to imagine how anyone would get interested in what you see behind me on the screen there, but Pong, for the first time, gave people the power to interact with a digital game at home. And, since then, the video game industry has grown and grown. And now, as I said, it's 40 years old. It is both substantial as a business phenomenon, pervasive in the experience of, especially the younger generation of people, particularly in the West but, in many other parts of the world as well. And, video games have developed a very sophisticated language of how to express themselves, and entertain and engage people. Here's one example just to show what I'm talking about here. This is CityVille, one of the casual social games on Facebook made by Zynga. And, CityVille, as you can see is, clearly a game and a fairly graphically simple game, at least compared to some of the rich 3D immersive games that we have on consoles and PCs today. Here's the interesting thing about CityVille. CityVille was launched by Zynga in 2011. In 41 days, it hit a hundred million registered users. Six weeks, zero, to a hundred million registered users. An extraordinary rate of growth and, it's not limited to just this one game or this one company, this is a huge phenomenon. So here is some statistics to capture just how big the video game industry is today. The industry, depending on who's numbers you take, is somewhere on the order of 60 to 80 billion dollars a year in revenues. Double the revenues of Hollywood from box office sales of films. Films make money from other mechanisms as well, including tie-ins with games, but if you're talking abour box office revenues, games are already much bigger and they're growing faster than Hollywood. The second is that games are evolving to the point where online games, games played or distributed online as opposed as to on consoles like the Playstation and Xbox and Nintendo Wii. Or, downloaded in a box and loaded on a PC, the online games are growing faster and are poised to become the biggest segment of the games marketplace, and interestingly, already the biggest component of the online games marketplace is China. So it's not just an American or a Western phenomenon. The third is that games are becoming the foundation for other industries. Virtual goods, I will talk about later in the class, but these are things that you can buy within the game. Think about a brand new sword for a player in a massively multiplayer online game. Or, some additional seeds and other equipment that you might use in a Zynga game like Farmville, things that you pay real money for that appear in the game, this economy around virtual goods is already many billions of dollars, 7.3 billion globally and 2 billion in the U.S., according to the latest statistics I could find. A very substantial market which is not games themselves, but something built on top of the great success of games. And, finally, the other great evolution is the rise of mobile games. This was a study early in 2012 that found that 44% of people, US and UK, have played a mobile game, something like an Angry Birds on their smartphone in the last month. So the games industry is big and it's developing, and I think it's fair to talk about it as the mass medium of the 21st century. Here are just a few statistics about usage numbers. If you look at things like the Zygna games, lots of people I talked about 100 million on CityVille, 250 million, quarter of a billion unique registered users and that, it was already probably a few months old, they've surpassed that. Angry Birds alone, over a hundred million. Xbox Live games, 35. World of Warcraft, over 10 million players. World of Warcraft, those are paying players, so that's even more important in terms of monetization. The other important piece, though, is how much time people are using these things. And so those 10 million World of Warcraft players up here, if you look at the amount of time they spend, it's actually huge, it's 50 billion minutes a month, because they're playing for long periods of time. Whereas something like Angry Birds, even though it has a higher user base, is only a mere 12 billion minutes a month that people are playing, because people use it less. Still a pretty big number. And if you look at something like the Xbox Live games, which are the core console games, so therefore things people play more, 120 billion minutes a month. So, figure out how much that is across the player base and figure out how much time that actually represents, relative traditional media, it's not the same thing as people having their television on for seven hours a day in the home, but this is interactive time. It's time where the player is directly engaged in playing the game. Big, big numbers. So, the important thing here to take away is that games are a mass phenomenon. And, just to correct a misunderstanding that people sometimes have, they are not just a mass phenomenon for teenage boys, it's true that the highest percentage of gamers is teenagers and young adults, 12 to 17 year olds in the US. The study by the Pew Research Foundation found 97 percent play some kind of video games. Virtually everyone, but it's not just them. An entertainment software association has found that the average gamer is actually 30 years old. And if you know anything about averages, that means there's a whole lot of them that are older than 30. Moreover, it's not just boys or men. Almost half of all video game players today are women. There are some skewing effects. Women, generally speaking, tend to play more of the social casual games. Men tend to play more of the first person shooter types of games. But overall, if you talk about video games as an experience, as a mass medium, as a phenomenon that people are conversant with and familiar with, it cuts across all those boundaries. And the final point is that video games are not just going in and guns blazing, blowing something up, and shooting things. Sure, there are games that involve that, and some of them have been very successful but, especially in recent years, we've seen the rise of many different categories of games that are very different. So, for example, the sandbox games things like Minecraft, which if you're not familiar with you should go check out, Minecraft is a game that was written by a single developer, that is incredibly rudimentary in terms of its graphics, has no purpose. You go into Minecraft, you're given a world, and you have to dig things up and find different kinds of ore and chop down trees, and do other things to create raw materials, and then put them together in different ways and build things. Why? Well, because it's fun. And it turns out that Minecraft has been a sensation. Huge numbers of users voluntarily paying money to pay this game. Which in most of the time, they were doing so was far from finished. It was expressly an alpha or beta form. People found this very compelling. In part because they could share their creations with other people. It gave them a huge sandbox. You could make anything you want in Minecraft. Another category are the building games right here, I already mentioned Civilization by Sid Meier. The Sim City games by Will Wright/sp. Games that let you create and build things. Again, not to kill 'em, but to figure out how your actions in running a complex system like a city, or like a nation state, create results as they interact with each other and with other parts of the system. A derivative of those are what I'll call social building games. Here's where we see things like Farmville and The Sims. Games that have that construction, building element, but also involve collaborating with and interacting with other players in the game. Showing off what you're doing for other players. Having a social dimension, in addition to that building dimension. Very popular, very successful. Then, we have the massively multiplayer online games, things like World of Warcraft, which again have been quite successful and do have some measure of running around and killing things, but also have guilds and communities, and things like auction houses, and things like leveling up characters in different skill areas and crafting, and exploring worlds. A rich experience much more than just the pure competitive, pure destruction element of games. And finally, puzzle games. Things like Angry Birds where you have to figure out, how do I pull this slingshot just the right way to knock over the structure. Or Portal and Portal 2, very successful hit game in recent years, in which the player has to figure out how to create holes in a wall that, when you put them together, solve a puzzle of how to get out of a room. If you haven't played go and look at some YouTube videos or some information on the game. Really successful powerful game using simple kinds of problem solving mechanics. And the point here is that these are not outliers or exceptions, these in many cases are the most successful game releases in recent years. So, games are big. They are sophisticated. They are pervasive across modern life, and they are diverse. They are not just as simple as you might think and they are not just about graphics, they are about all these different forms of interaction, individually and socially.
