Category: money

The financial model that supports how games companies make their money has changed dramatically in the past decade or so. Now many developers and publishers rely on in-game purchases to help with their bottom line rather than solely on the up-front cost of buying a title to play. […] Some games companies are also exploring the introduction of non-fungible-tokens (NFTs) – a form of digital art that players can buy and own — into their games. […] Sid Meier says that if major companies continue to focus on ways like this to monetize gaming, they risk losing the audience: “People can assume that a game is going to be fun and what it needs for success are more cinematics or monetization or whatever — but if the core just is not there with good gameplay, then it won’t work. “In a sense gameplay is cheap… The game design part is critical and crucial but doesn’t require a cast of thousands in the way some of the other aspects do. So it’s perhaps easy to overlook how important the investment in game design and gameplay is.”

The global games market is reported to be worth around $175 billion and is forecast to almost double in five years. But Sid Meier says that continued growth isn’t guaranteed: “There are lots of other ways that people can spend their leisure time… I think the way the internet works, once a shift starts to happen, then everybody runs to that side of the ship. “I think we need to be sure that our games continue to be high quality and fun to play – there are so many forms of entertainment out there now. We’re in a good position… but we need to be sure we realize how critical gameplay is – and how that is the engine that really keeps players happy, engaged and having fun.”

Sid says he has no plans to retire just yet, and explains the most gratifying change he’s experienced during his more than 30 years in the industry, is the wider public’s shift in attitude when it comes to games. People were telling him back in 1991 that he was “wasting his time” working in games – now he smiles, as people say to him: “I wish I could get a job making games.”

“Yet the hype belies a more complicated relationship. Unlike the National Basketball Association, the National Football League, the country’s most popular sports league, has essentially prohibited its teams from using crypto.”

It’s a microcosm of the broader cultural battle between those touting the currency as the shiny future and others warning of its dangers…. [T]he headlines often come with a negative tint. New York Times columnist and economist Paul Krugman warned last month about crypto’s parallels to the subprime mortgage crisis. This week, the FBI arrested a New York couple for allegedly conspiring to launder billions in crypto. That can scare the large corporate entities of professional sports, particularly the NFL, whose love of fresh revenue sources is matched only by its fear of public relations disasters…. In September, a memo revealed by the Athletic showed the league’s restrictive attitude toward crypto… “Clubs are prohibited from selling, or otherwise allowing within club controlled media, advertisements for specific cryptocurrencies, initial coin offerings, other cryptocurrency sales or any other media category as it relates to blockchain, digital asset or as blockchain company, except as outlined in this policy,” it said.

The NFL has made some forays into NFTs, or non-fungible tokens, the digitally watermarked tools that are crypto’s less controversial cousin, signing up for a partnership with Ticketmaster for NFTs of Super Bowl tickets and an NFT video highlight program with Dapper Labs, one of the leaders in the space. And of course the Super Bowl is taking place at SoFi Stadium, named for the digitally minded financial firm. But sponsorships from crypto exchanges remain off-limits, and the idea of the NFL creating a cryptocurrency, which some enthusiasts have advocated, is the stuff of fantasy. Even the Super Bowl commercials going for as much as $7 million for 30 seconds — which the league authorizes — include only exchanges such as FTX and not currencies themselves….

The NFL has formed an internal working group to study the regulatory, brand and other consequences of partnering with crypto companies but has set no timetable for when its rules could be revised. Renie Anderson, the NFL’s chief revenue officer, said the league is moving slowly by design. “We don’t want to put everything and the kitchen sink into this,” she said by phone from the site of Super Bowl events in Los Angeles. “We don’t know where a lot of this is going, so what we’re trying to do is testing and learning so we can understand.” She cited regulatory and market forces that are still coming into focus. (The Treasury Department and other federal agencies have been ramping up their efforts to create a regulatory framework for crypto, but there remains a degree of murkiness around what the future limits might be.) The NFL, Anderson said, would rather act after there’s clarity. “It’s hard to unwind something like a naming rights deal,” she said, “and I’d rather not have to undo opportunities two years later because there are rules against advertising or marketing certain things.”

National Basketball Association executives, however, say they see a major opportunity right now.

The article also points out that one football star even says he converted his $750,000 salary to Bitcoin. Though one sports analyst calculates that if the purchase was made on November 12th, after federal and state taxes it’s now worth about $35,000.

Reuters cautions that the newly-released research does not suggest that the U.S. central bank will move toward launching a CBDC, a step it has said it would not take without clear support from the White House and Congress….” Instead the team “developed technology that can be adjusted as more policy questions regarding the structure and purpose of a CBDC are addressed.”

The Washington Post describes it as “a system that can settle the vast majority of payments in less than two seconds, handles more than 1.7 million transactions per second and operates around-the-clock with no service outages in the case of a disruption in its network.”

The Boston Globe adds that “The team noted there’s a lot more work to do in the next phase, including researching various privacy features, and stressed the digital dollar remains hypothetical until the Fed decides whether to move forward with government-backed electronic cash.”

Some context from the Washington Post:
The ultimate product could help extend financial services to people who lack a bank account and make cross-border payments such as remittances safer and easier, said Neha Narula, director of the Digital Currency Initiative at MIT. Narula, in a conference call with reporters, noted that the Boston researchers “aren’t the ones making policy decision on how such a system might operate,” so they have aimed to “create a flexible system that can work with a variety of models.”
Along with a paper describing the team’s work to date, researchers on Thursday published open-source code for the platform that would support the digital currency. Jim Cunha, executive vice president of the Boston Fed, called that a first for the central bank, intended to encourage public input that improves the technology.

“A CBDC could fundamentally change the structure of the U.S. financial system, altering the roles and responsibilities of the private sector and the central bank,” the report says. One primary difference between the Fed’s dollar and other digital transactions is that current digital money is a liability of commercial banks, whereas the CBDC would be a Fed liability. Among other things, that would mean the Fed wouldn’t pay interest on money stored with it, though because it is riskless some depositors may prefer to keep their money with the central bank.

The paper lists a checklist of 22 different items for which it is soliciting public feedback. There will be a 120-day comment period. Fed officials say the report is the first step in an extensive process but there is no timetable on when it will be wrapped up. The paper released Thursday notes that the Fed’s “initial analysis suggests that a potential U.S. CBDC, if one were created, would best serve the needs of the United States by being privacy-protected, intermediated, widely transferable, and identity-verified.” However, the report also states that it “is not intended to advance a specific policy outcome and takes no position on the ultimate desirability of” the digital dollar. The report notes that the speed of the project is not a top priority. Instead, the authors of the report are focused on getting it right. “The introduction of a CBDC would represent a highly significant innovation in American money,” the report says. “Accordingly, broad consultation with the general public and key stakeholders is essential. This paper is the first step in such a conversation.”

The Fed also said that it will not proceed without a clear mandate from Congress, preferably in the form of “a specific authorizing law.”

Then they were confronted by gamers like 18-year-old Christian Lantz, who for years has played GSC Game World’s first-person shooter game S.T.A.L.K.E.R.
Mr. Lantz was incensed. He joined thousands of fans on Twitter and Reddit who raged against NFTs in S.T.A.L.K.E.R.’s sequel. The game maker, they said, was simply looking to squeeze more money out of its players. The backlash was so intense that GSC quickly reversed itself and abandoned its NFT plan.

“The studio was abusing its popularity,” Mr. Lantz, who lives in Ontario, said. “It’s so obviously being done for profit instead of just creating a beautiful game….”

[C]lashes over crypto have increasingly erupted between users and major game studios like Ubisoft, Square Enix and Zynga. In many of the encounters, the gamers have prevailed — at least for now…. Players said they see the moves as a blatant cash grab. “I just hate that they keep finding ways to nickel-and-dime us in whatever way they can,” said Matt Kee, 22, a gamer who took to Twitter in anger this month after Square Enix, which produces one of his favorite games, Kingdom Hearts, said it was pushing into NFTs. “I don’t see anywhere mentioning how that benefits the gamer, how that improves gameplay. It’s always about, ‘How can I make money off this?'”

Much of their resentment is rooted in the encroachment of micro transactions in video games. Over the years, game makers have found more ways to profit from users by making them pay to upgrade characters or enhance their level of play inside the games. Even if people had already paid $60 or more for a game upfront, they were asked to fork over more money for digital items like clothing or weapons for characters…. Merritt K, a game streamer and editor at Fanbyte, a games industry site, said gamers’ antagonism toward the companies has built up over the last decade partly because of the growing number of micro transactions. So when game makers introduced NFTs as an additional element to buy and sell, she said, players were “primed to call this stuff out. We’ve been here before.”
That has led to bursts of gamer outrage, which have rattled the game companies. In December, Sega Sammy, the maker of the Sonic the Hedgehog game, expressed reservations about its NFT and crypto plans after “negative reactions” from users. Ubisoft, which makes titles like Assassin’s Creed, said that it had misjudged how unhappy its customers would be after announcing an NFT program last month. A YouTube video about the move was disliked by more than 90 percent of viewers. “Maybe we under-evaluated how strong the backlash could have been,” said Nicolas Pouard, a Ubisoft vice president who heads the French company’s new blockchain initiative.

Game companies said their NFT plans were not motivated by profit. Instead, they said, NFTs give fans something fun to collect and a new way for them to make money by selling the assets. “It really is all about community,” said Matt Wolf, an executive at the mobile game maker Zynga, who is leading a foray into blockchain games. “We believe in giving people the opportunity to play to earn.”

The article also rounds up examples of game companies it says have “come out against crypto.”

“Phil Spencer, the head of Microsoft’s Xbox, told Axios in November that some games centered on earning money through NFTs appeared ‘exploitative’ and he would avoid putting them in the Xbox store.” “Valve, which owns the online game store Steam, also updated its rules last fall to prohibit blockchain games that allow cryptocurrencies or NFTs to be exchanged….” “Tim Sweeney, the chief executive of Epic Games, the maker of the game Fortnite, said his company would steer clear of NFTs in its own games because the industry is riddled with ‘an intractable mix of scams.’ (Epic will still allow developers to sell blockchain games in its online store.)” The blowback has affected more than just game studios. Discord, the messaging platform popular with gamers, backtracked in November after users threatened to cancel their paid subscriptions over a crypto initiative.”

Retailers are expected to pass on the cost of returns in the form of higher prices. “The consumer pays the price of a free return,â Columbia Business School retail studies professor Mark Cohen told Today. Some retailers, namely Amazon, sometimes tell returners to keep it. It would cost them too much to process a return, Moore says. The challenge for online retailers is to process returns quickly and get the goods back onto their virtual shelves, minimizing depreciation. “The faster you can get a good back to stock, the more you can avoid markdowns,” Moore says.

In response, the Fractal team issued a statement acknowledging the breach, along with a promise they are “going to make this right.” […] ractal say they are “planning to fully compensate these 373 victims,” before adding the extraordinary warning, “We must use our best judgement as there’s no ‘undo button’ in crypto,” making the entire post read like a textbook example of showcasing why this is such a shitty space. Meanwhile, Kan issued a short video statement of his own, alongside warnings that this Discord scam had been perpetrated on other NFT communities as well.

With a 100-year-old brand, “we are going to lead the way for blockchain tech to reach mainstream adoption by other large brands.”

The RadioShack home page says they’ll start with a “symbiosis” with Atlas USV, a community-driven project to build a universal, decentralized/widely accessible DeFi base layer. Atlas USV’s “Barter” mechanism lets users purchase third-party tokens and transfer them to Atlas USV’s treasury in return for discounted USV tokens. “The Atlas USV treasury can accumulate any crypto asset of its choice with this dynamic…
“Once the liquidity pool surpasses other exchanges’ liquidity level in any token pair, our swap efficiency will be unbeatable for that pair…

“Other decentralized exchanges margins on swap fees are our opportunity…. ”

Or, as they explain on a more detailed web page, “We intend RadioShack to be the first protocol to pass over into mainstream usage in the history of DeFI,” promising that RadioShack DeFi “will become the first to market with a 100 year old brand name that’s recognized in virtually all 190+ countries in the world…”

“RadioShack has one objective: Distribution and usage by millions of individuals but possibly more important, by hundreds of blue-chip, large corporations as their gateway into becoming blockchain companies.”

Currently there’s a sign-up form for a notification when “RADIO token” launches (as well as links to their channels on Discord and Telegram).

Their “Fundamentals” page explains that “It is our hypothesis that the best way for crypto to be more mainstream is for an established brand name in the tech space to lead the way.”

The RadioShack brand was purchased In November of 2020 by e-commerce rehabilitator REV, now listed as a collaborator on RadioShack’s home page. (Ironically, the “Fundamentals” page also includes RadioShack’s Super Bowl ad where there store is taken back by the 1980s.)

The official Twitter feed of Radio Shack now also has the same new tagline: “Bringing Cryptocurrency To The Mainstream.”