Thursday, August 18, 2011

EA versus Valve: It's All About the DLC

Electronic Arts (EA) has until lately sold many of their hit games through Valve's "Steam" digital game distribution system (as well as in retail stores). Suddenly EA have started pulling their games from Steam. EA are selling these games on their own internal digital distribution system called "Origin," as well as on other digital distributors -- just not Steam.

Valve professes to be terribly puzzled by this unpleasantness. EA grumbles that it's all Valve's fault but won't say why.

The latest: Today, Gabe Newell, head of Valve and its Steam money-printing machine, emerged from his den to say that he's a little puzzled by all this, but he hopes EA will realize that it can make more money keeping its games on Steam, and gosh, he sure hopes all this unpleasantness can get sorted out soon.

Newell is reported to have said:
"We really want to show there's a lot of value having EA titles on Steam. We want EA's games on Steam and we have to show them that's a smart thing to do. I think at the end of the day we're going to prove to Electronic Arts they have happier customers, a higher quality service, and will make more money if they have their titles on Steam. It's our duty to demonstrate that to them. We don't have a natural right to publish their games."

Everything I've read so far says that this slapfight is not about the Main Game at all. It's about the follow-on sales of "downloadable content," or DLC, which is gameplay that's added to a game after it's initially released for sale.

Based on comments from EA, it appears that Valve are insisting that if the Main Game is sold through Steam, then any/all DLC for that game also has to be available through Steam. For their part, EA apparently (again, this is just my reading of the public comments from all involved) feel it would be a bad idea to allow Valve to dictate to them any terms of how their (EA's) game content will be distributed, so they are taking their Main Game and going home (to Origin).

If that is an accurate reading, then Gabe Newell is being a little disingenuous. The things he's quoted here as saying are all perfectly sensible, but he's (deliberately?) not saying anything at all about the actual source of contention.

I'm not even suggesting Newell's position on DLC is wrong. I can see the possible point that it is necessary for a digital distributor to be able to to provide the DLC along with the patches for a game in order to properly support that game, and to insist on that as a matter of effective business practices. The problem I have is with the principals in this little drama not simply coming out and saying so, if that is in fact what's going on here.

What makes this rather fuzzier is that it makes sense for EA to stand up their own digital distribution system. Even without the comments made by EA during their investor calls to describe their "forward-looking" intentions for digital distribution as part of their overall five-year strategy, it's simply smart for EA to not only distribute its own games digitally but to try to elbow its way onto the playing field as a distributor for other peoples' games as well. EA is big, but Steam is getting big; EA can't afford not to get into that game. The only thing that's been holding them back has been retailers, with whom EA has maintained a happy monogamous relationship in public... until now. I guess somebody at EA finally decided Steam was getting too successful and pulled the trigger on Origin.

My free advice to EA and Valve: sort this before it snowballs and really starts costing you money.

Friday, August 12, 2011

The PC at 30... and Beyond

Today is the 30th anniversary of the launch of the IBM PC.

As we rightly look back on that as the opening of the gates to mass ownership of computing systems, it's interesting to read that one of the original creators of the IBM PC has essentially declared it to be obsolete.

In a blog post, Mark Dean says:
[W]hile PCs will continue to be much-used devices, they're no longer at the leading edge of computing. They're going the way of the vacuum tube, typewriter, vinyl records, CRT and incandescent light bulbs. ... [I]t's becoming clear that innovation flourishes best not on devices but in the social spaces between them, where people and ideas meet and interact. It is there that computing can have the most powerful impact on economy, society and people's lives.

Of course the Way of the Weasel teaches us to simply declare that any man-portable computing device shall henceforth be known as a "PC." ;)

Actually, I agree with Dean's larger point: the proliferation of computing devices was a necessary foundational step -- it's what has been built on that foundation that is where the real value lives. PCs are valuable, not in and of themselves, but for what they do: they connect people to knowledge.

I've said for a number of years now that the economic boom in the US in the mid-1990s was due not to any government policy (that would give credit to bureaucrats that they did nothing to deserve) but rather to that being the Time of the WAN -- more specifically, the Internet. Businesses had been hooking their computers together using LANs during the first half of the '90s, and that was helpful in sharing local knowledge. But the productivity explosion really occurred in the mid-'90s when businesses starting linking their intranets to each other via the Internet. Suddenly knowledge that resided anywhere was available everywhere.

That knowledge was, and remains, terribly diffuse for the most part. We still haven't implemented the necessary systems that automatically store knowledge in a structured way allowing for high-quality search-and-retrieval. That process is maturing slowly, but we're now finally starting to see the kinds of systems being built that will enable access not just to general knowledge but to the specific knowledge that can ignite another burst of increased productivity.

Looking at this process a little more closely, I believe we can see that the key to the Information Revolution is mediating human access to knowledge. In other words, the pivot point is the interface between individuals and knowledge. Whoever controls the interface between people and knowledge gets rich because they make a product that lots of people want.

This pattern can be seen to have three (modern) phases so far. The first phase was Microsoft's. When PCs began to proliferate in the late '70s, and in particular when the IBM PC arrived in 1981, knowledge (better described as just "data" since it wasn't well organized) lived on computer disks and hard drives. So the intermediary between that data and the people who wanted it was the operating system. Microsoft owned that, so they prospered.

This monopoly was challenged (as monopolies always are) by a new technology. In this case it was the local-area network. As more (business) computers got hooked into LANs, data increasingly became stored not on individual PCs but somewhere out on "the LAN." Because Novell owned the premier Network OS (NetWare), Microsoft could see their dominance of the human/data interface slipping away. So they cranked out a LAN software package of their own... and nobody bought it. NetWare was established as the new primary interface, and Novell was riding high.

With egg on their faces after the Microsoft LAN Manager debacle, Microsoft stepped back and said (essentially), "Well, OK, the fight for today's human/data interface is pretty much lost. What's tomorrow's interface going to be? We've heard about this thing called 'the Internet,' and this guy named Marc Andreesen has written some communications software that lets people use the Internet pretty easily to access data anywhere. He's also written something called a 'browser,' which works sort of like Windows only with less hardware dependence and more knowledge-awareness. If we act now, we can totally own that segment. We'll do an end-run around Novell."

And that's exactly what happened.

Novell, like Microsoft before them, thought their interface would rule the world forever, forgetting that changing technology changes the environment. And a product adapted for success in one environment doesn't necessarily fit well in a new world.

So Novell kept pushing NetWare. Meanwhile, Microsoft created Internet Explorer, which they then bundled with the PC operating system they were still selling as a foundational technology. It wasn't long before IE displaced Netscape as the dominant browser -- which is to say, as the world's dominant interface between people and data. NetWare became perceived as an evolutionary dead end, reducing Novell almost overnight to a shadow of its former glory. And so Microsoft climbed back on top again.

But there was still the problem that data was disorganized. Yes, knowledge was out there, but you could drive yourself mad trying to find it in time to make productive use of it. Some new kind of intermediary was needed -- something that could take the sagans of info-bits, categorize them, and quickly deliver only the most relevant items to users.

Thus began the rise of the search engines. There was a lot of competition early on, which was good. Eventually Google became the search engine of choice. Their success has allowed them to begin to experiment with new ways of hooking people to data. It's still early in the process, but already we can dimly perceive the form of the third phase. Namely, the social Information Revolution, wherein what's really being hooked together are the actual sources of data: people themselves.

This is where Google, along with social networks like Facebook and LinkedIn, stands to replace Microsoft as the gatekeeper of the interface between people and data. This, I think, explains certain things we read about in the news. It's why Google desperately wanted to buy Facebook, as well as Skype and Twitter. It's why the valuation of LinkedIn shares doubled on the first day of its IPO. It's why the median price of single-family homes in Palo Alto (home of Facebook) is now $1.3 million dollars during a serious housing industry downturn. Whoever is seen as controlling the most effective interface between people and knowledge wins.

Barring some kind of catastrophe, I fully expect this process to continue, leading to a nice mini-boom in the mid-'10s. Unlike the mid-'90s, this one should be more gradual, but it'll still be good times for most people within that economic environment. As JFK said, a rising tide lifts all boats. (This does, however, assume that the present popular demand for politicians to deal seriously with ever-rising national debt finally sees some victories. If the current tax-and-spend binging is allowed to continue, all bets are off; we will be looking at economic catastrophe. I'm hopeful we'll collectively do the right thing, though.)

The one factor I can't predict is Microsoft. These guys are used to winning, and they are not going to give up control over the human/data interface without a fight. The question is whether Google is now in the same position that Novell was in previously. Google don't seem to be as complacent as Novell -- they keep coming up with new product concepts, even if they are much too quick to drop those concepts if they don't go viral in a few months. So that's an argument against Microsoft wresting control of the human/data interface away from the new owner.

On the other hand, Microsoft have proven in the past that they're capable of looking beyond today to see what tomorrow's crucial interface technology is likely to be. I would not be at all surprised if tomorrow Microsoft announced that the next version of IE would feature a new built-in (probably cloud-based) data/social search facility. Snark at Microsoft all you want; they are capable of building sufficiently good products and marketing the hell out of them. Would such a system be perceived as good enough to shove a separate Google and Facebook out of the way, reestablishing Microsoft as the owner of the human/data interface?

I don't know. I will say that I think that if Google had been able to buy Facebook, Microsoft would probably have fallen to second place by 2015 and into 2020. Beyond that, they might still find a way to do an end-run around a GoogleFacebook, but I can't imagine at this time what kind of disruptive new technology would be necessary for that to happen -- neural interfaces, maybe?

Of course, then we have the fun scenario of a software developer writing code that connects to your brain. "Blue screen of death" could take on a whole new meaning....

Wednesday, August 10, 2011

BioShock's Assault on Exceptionalism

The computer game BioShock (and its sequel) was set in what the developers called a "failed underwater Utopia." The game's story was based on the concept of Ayn Rand's exceptionalist philosophy of Objectivism, but did its best to paint that philosophy as so irredeemably broken that it could hold only the power-mad bigots who espoused it and the power-mad opportunists who exploited it.

Now BioShock: Infinite is being discussed by its creators. And the horrible principle animating the story this time? Exceptionalism again... only this time it's American exceptionalism (as imagined at the dawn of the 20th century) that's scheduled to be demonized.


I played BioShock 1 & 2 and enjoyed them for what they were. And I'll probably be able to enjoy BioShock: Infinite.

But why do these games now have a pattern of making exceptionalism their bĂȘte noire? Why continue to focus on wrapping the story setting around a grossly negative portrayal of exceptionalism? Did the notion of a culture that works hard to accomplish great things just happen to be one concept among several that the designers felt could safely be caricatured as villainous, like eeeeeeevil corporations? Or does someone have a special reason for wanting to try to smear the highly successful American experiment in freedom in particular as some kind of dangerous aberration?

Was there really no other historical social philosophy that could have served as a satisfying and effective narrative backdrop for shooting lots of simulated people? Really?

Again: I expect to play and enjoy BioShock: Infinite. It's no System Shock, but it's closer to that exceptional game than a lot of others. That doesn't mean I can't wonder why the striving for exceptionalism -- of all things -- is chosen to be the designated horror story in the BioShock universe when so many other human notions have had demonstrably worse consequences for humanity.

As just one possibility that springs to mind, does no one recall the popularity of eugenics in certain "progressive" circles around the very time period in which BioShock: Infinite is set? Why would that not have been an even more appropriate social-narrative hook for a BIOshock game littered with "gene tonics?" Why instead try to portray exceptionalism, American or otherwise, as threatening?

One day I hope to read a straight news story or interview that explores the real answer to this question.