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For years, the Electronic Entertainment Expo (E3) has been associated with the city of Los Angeles and its sprawling downtown convention center. But the game industry trade group is considering moving out because of construction issues.

The city of Los Angeles is planning to tear down the West Hall of the LA convention center as part of its proposed Farmers Field football stadium

Mike Gallagher, head of the ESA, said in a conversation with GamesBeat at a Microsoft event on Monday evening that a decision about moving out or staying in LA was “imminent.” He said that the proposal from the ESA has been with the city for months and now is the time to act on it. Among the issues related to a remodeling of the convention center are traffic, construction, and a smaller amount of floor space.

The show is a big deal to LA because it generates more than 30,000 hotel room stays, draws 46,000 attendees, and generates $40 million in revenue for the city. That comes in the form of direct spending on lodging, restaurants, taxis, construction workers and booth attendants.

Sources close to the association said that San Francisco, New York, Chicago, and New Orleans are among the alternative cities. E3 has been in LA for 16 of its 18 years, with a detour to Atlanta for a couple of years. Having been to almost all of them, I recall the muggy summer days in Atlanta and won’t necessarily welcome New Orleans or Chicago. New York is pretty expensive, and San Francisco has smaller venues.

But I think the driving reason that the show should be in LA is because that is the nexus of the entertainment industry. Perhaps it might be OK to move the show out for a couple of years and then return when LA gets its act together. But for the long term, the show should be in LA.

As a further thought, San Francisco is the home of the Game Developers Conference. That event is for developers, and it makes sense because so many developers are based in Los Angeles. But LA is where a lot of the powerful entertainment industry leaders hold court. Since E3 is a publisher’s show, a show for the marketers and power brokers, it belongs in LA and not San Francisco.

Filed under: games

Wooga has come out of nowhere to become the second-largest player on Facebook in social games. Now it is showing great progress in getting downloads on iOS too, with more than 11 million downloads of Diamond Dash in four months.

The Berlin, Germany-based social and mobile game studio that has become Europe’s largest social game publisher with more than 46 million monthly active users on Facebook. Diamond Dash debuted in December on iOS (iPhone, iPad, and iPod Touch) and it took off thanks to social features such as synchronized scores between mobile and Flash versions, a real-time leaderboard and the ability to gift friends playing on a desktop computer from a mobile device.

The percentage of users choosing to connect to Facebook via mobile has continued to rise since the game launched, from 28 percent of users in December 2011 to 64 percent of users at the end of March. Users who log in from Facebook are eight times more likely to spend money and spend 50 percent mroe on average. Users were directed to the Diamond Dash app from Facebook more than 18.5 million times. More than 100,000 players are using the new iPad with the better retina display. The iPhone accounts for 51 percent of downloads, 13 percent for the new iPad, 25 percent for the iPhone 4, and 22 percent for the iPhone 4S.

The company was founded in 2009 by Jens Begemann (whom we interviewed at the Game Developers Conference), Philipp Moeser, and Patrick Paulisch with the goal of making games for everyone, including the mass market and not just gaming die hards. Since then, it has only published six of them: Bubble Island, Brain Buddies, Monster World, Happy Hospital, Magic Land, and Diamond Dash. With that portfolio, the developer grew its monthly active users by 185 percent in 2011.

Wooga has raised $24 million in venture capital and has grown to more than 150 employees.  The company now faces a number of strategic decisions, such as doubling down on Facebook or spreading out to platforms such as Google+ or Zynga.com.

Filed under: games, mobile, social, VentureBeat

Kellee Santiago, co-founder of Journey developer Thatgamecompany, has decided to leave the Santa Monica, Calif.-based game studio that she started with Jenova Chen, according to Gamasutra.

The split is described as an amicable one, and Santiago said it was  time for her to move on. That brings to an end one of the most creative and successful collaborations on the artistic side of video games. Journey, the teams latest effort, went on sale as a downloadable title on the PlayStation Network on March 13. The game has already gotten accolades from game critics, including a high rating of 90/100 from GamesBeat. In the non-violent game, the player goes on a solitary journey across the desert to a distant mountain. The visual effects of the wind and sand are beautiful, and the story is told without any words. The game has been the fastest-selling game in the history of the PSN.

“After doing these three games, I think it was a really great opportunity for all of us to look at what we’ve learned and what I’ve taken from that experience, and go forth and take it into new arenas,” Santiago said.

Gamasutra said other members of the small team may leave as well. Chen has been the creative visionary at the company and Santiago has helped execute those visions as president. Santiago became famous for a TEDx talk on how video games can be considered art, putting her at odds with move critic Roger Ebert, who didn’t play games but said that games can “never be art.” We caught up with Santaigo recently at the Game Developers Conference, where she noted that the experience of making Journey was a tough one.

“So much of my work at Thatgamecompany was really supporting Jenova’s visions for the types of games he wanted to make, and I felt like I have done everything I needed to do there, and that he’s in a great place now to go on and continue with some of the other people at Thatgamecompany, to take that to a whole new height,” Santiago told Gamasutra.

Gamasutra says a new project has begun at Thatgamecompany. Previous hits include Flow and Flower.

Filed under: games

For decades, the dominant theme in video games has been violence. That’s not surprising, since violent competitions have been dominant in culture for thousands of years. But it doesn’t have to be that way. Video games can be about love, emotion, and positive motivation, according to a panel of game developers who are trying to make all of that happen.

The panel on “How Designing for Love Can Change the World” was part of the Games For Change summit at the Game Developers Conference a couple of weeks ago. The panel was part of a movement among game designers who want to change the world for the better. They know that sex in games can be common and crude, but love is pretty scarce.

Their goal is to start a conversation about “how to create more love with our art,” said Jane McGonigal, a veteran game developer at Social Chocolate and co-moderator of the panel. She is well-known as the author of the book Reality Is Broken: Why games make us better and how they can change the world.

“This is about what games could be,” McGonigal (pictured far right) said.

The speakers are also part of a group of researchers, known as the Digital Romance Lab, that is working on games that have to do with love, romance, and flirting. They’re not talking about sex, or porn, per se. Led by Jane Pinckard, who co-moderated the panel at the GDC, the Digital Romance Lab has done things like collect the most romantic moments in video games in the past year. Pinckard is associate director of the Center for Games and Playable Media at the University of California at Santa Cruz.

Chelsea Howe (pictured in orange hat) and Michael Molinari (pictured in blue shirt) became a real-life couple while working on a game called The End of Us. Created in a 48-hour Global Game Jam in 2011, the game features two comets that come together and frolic through the void. They become companions until it becomes clear that one of them is going to collide with the Earth. After the collision, only one lonely comet is left to fly through space. The game is about how to deal with a great loss of a love.

Molinari said, “You have to first have something, before you lose. So knowing that, the whole game builds up to this moment of loss.”

People who played the game reacted very emotionally to it.

Howe, design director at Super Better Labs, said the science behind emotion shows that when you feel an emotion, you spread it to six people. In a day, you can affect more than 250 people.

“How do you figure that out and stick that in a game?” Howe asked.

When you affect a player with emotion in a game, you can make an impact on more than 250 people.

One way is simply to give players a way to communicate and enable them to “project themselves into a space that we leave open for them.” Super Better Labs did this with a “secret wall” that players could find and then use to talk to each other.

If love is defined (by psychology professor Barbara Fredrickson) as a “shared positive emotion,” then sharing of games and sharing in games is a way to bring love into them. Howe said some of her favorite games that did this were Ecco the Dolphin, Flower, and Mirror’s Edge. With these games, Howe said, she felt full of hope and wonder while she was playing them.

Martin Hollis (pictured center), a former hardcore game designer who is co-founder of the Digital Romance Lab, said the 5,000-year-old Royal Game of Ur, the oldest board game in the world, was about dominating others. On the panel, he said that Jon von Neumann, the computing pioneer, argued that in game theory, zero sum games mean there are only winners and losers. You might conclude that games are always competitive, alway confrontational.

But Hollis said John Nash, the mathematician depicted in the film A Beautiful Mind, argued that there was another kind of strategy, dubbed non-cooperative equilibrium, where cooperation in games can pay off for the good of all. Hollis also mentioned that actress Eva Gabor said, “Love is a game that two can play and both win.”

Hollis said he hopes that a “change is in the air” regarding the romantic genre in video games — a genre that currently doesn’t exist. Perhaps, he said, we can look back on this moment in 5,000 years and view it as a turning point for love games. He thinks it would be cool to make matchmaking games where you can test whether people are a good match or not. He thinks such games could give some intrinsic motivation, or pleasure from within, by being a skilled matchmaker in a “match two” game.

“Games have been about war for thousands of years. Why not change them?” he asked. “Make love games normal. Maybe then, in 5,000 years, half the games will be about war, and half about love.”

Scott Brodie, founder of Heartshaped Games in Kirkland, Wash., sent a recording because he wasn’t able to be at the panel in person, since his wife was having a baby. His game was Hero Generations, where a lifetime lasts five minutes. In that time, you have to choose a mate, choose when to have a family, and then end your heroic adventures. You can build things like farms and roads that the next hero who succeeds you can take advantage of. The hero has to invest time with his or her family and make sacrifices while seeking individual goals.

You can design a game to influence how people view the world, he said. If you change one player at a time, you can change the world.

Mitu Khandaker (pictured second from right), an indie game developer and researcher at the University of Portsmouth in the United Kingdom, said that love is a very diverse thing and  that it takes a lot of thought to figure out which part of it you want to depict in a game.

“How do you model the experience of love? Any one couple?” Khandaker said.

At the Digital Romance Lab, she worked on a game with robots. In the game, one robot had to search for another robot and find a companion. That led to the game Redshirt, currently under development in the U.K. The game lets you schmooze your way through social circles and claw your way up the career ladder.

McGonigal said, “Let’s see a love game nominated for the awards next year, or featured in a keynote.”

GamesBeat 2012 is VentureBeat’s fourth annual conference on disruption in the video game market. This year we’re calling on speakers from the hottest mobile, social, PC, and console companies to debate new ways to stay on pace with changing consumer tastes and platforms. Join 500+ execs, investors, analysts, entrepreneurs, and press as we explore the gaming industry’s latest trends and newest monetization opportunities. The event takes place July 10-11 in San Francisco, and you can get your early-bird tickets here.

Filed under: games

Neil Young sold his San Francisco startup Ngmoco to Japan’s DeNA for $403 million in the fall of 2010. And that was just the beginning of Young and DeNA’s quest to create a multibillion-dollar mobile entertainment group, he told VentureBeat last year. DeNA, with $1.4 billion in revenues in the last year, has already cleared many hurdles on that path. Ngmoco has integrated its NG Core technology with DeNA’s Mobage social mobile gaming network to create a new platform for smartphone entertainment.

Mobage is organizing content around an “interest graph” — that is, grouping people by their interests. DeNA has succeeded in doing this in Japan, but a huge market awaits it if it can do the same in the U.S. and on a global stage. While the U.S. market still isn’t there yet, Young believes it will be, and he believes Ngmoco is still a huge part of that undertaking.

We caught up with Young, the CEO of Ngmoco and an executive officer at DeNA,  at the recent Game Developers Conference in San Francisco. Here’s an edited transcript of our interview with Young.

GamesBeat: How are you doing on the road to the mobile gaming bonanza?

Neil Young: It’s the same. We still believe that there’s a tremendous opportunity to create that future entertainment company. We think that building the leading global, social, mobile game platform company is the vital milestone that we’re going to have to pass through to get entrance to the pantheon of media companies.

As DeNA, we’re focused on doing that. 2011 was really about putting all the pieces of the puzzle in place to be able to do that. We talked about building something that’s cross-platform and cross-border, as two very critical pieces of the strategy. We now have games authored by teams in Japan that are coming to the west, and games authored by teams in the west coming to Japan. Pocket Frogs and Zombie Farm just released on the Japanese market.

We’ve released games on Android for a quite a while now, since the third quarter of last year, and we’ve just released our first iOS games, built on the ngCore framework. Those same games now live on two platforms, and those same games live in multiple regions. So that part of the strategy has now been implemented and done. We’ve got about 45 live titles on Mobage now, on smartphone. Over a thousand across Mobage in all title types.

2012 is about getting some of the first-party titles we’ve had in development out and live, bringing some more developers to the platform, and continuing to iterate on the learning and the knowledge so we can deliver the best platform possible. I think we’re ahead of our competition in terms of being live, having experience, having quality developers and games on the network. I feel pretty good about our prospects.

Gamesbeat: And the results so far, for the games that are up on Mobage?

Young: Pretty good. There was a period of time, I think, where it was easy for our competitors to take potshots at us, as we were really just going through the beta testing on these titles. They would talk about, “Wow, they’re only three-star-rated games,” or “Look, the downloads on the Android market are only 10,000.” We try to ignore that commentary, as annoying as it is, because the only venue you have to test these titles is really with real customers. At the point that we were ready to hit the go button on some of those titles, we did. I don’t think you can find a Mobage game that has a rating of less than 4 or 4.2 on any scale.

You take Tiny Tower, which is a game on Mobage, the Android market range is in the one million to five million downloads. Most of the games that we’ve released and promoted have hit the one to five million, or 500,000 to a million download mark. So I think in general, on Android, I think we’ve made pretty good progress. We’re operating a growing and scaling network now. We’re billing, we’re making money on virtual goods. We have great metrics in that regard. I feel pretty good.

We have learned a lot. And I think I try to remind the people inside our company, when sometimes you hit bumps in the road, you learn things. Our competitors have to go through those same learning curves as well. That’s why I feel pretty good about our position.

GamesBeat: Those titles are producing real money. When will that revenue look good compared to what DeNA makes in Japan?

Young: We’re a long way away from that. But that’s always been known. What’s happening in the U.S. now is analogous to what happened in Japan in the mid-2000s. You’ve got the primordial soup to build really big, at-scale media services. That’s what they call it in Japan: the media service industry. If you just look at some of the metrics, in Japan in the mid-2000s you had over 90 percent penetration of mobile into the population base. 3G penetrating over 40 percent. Low cost or flat price billing and devices that — yes, they could make telephone calls and send text messages — but they could also take photos and play games and listen to music and buy goods and services that would directly bill off your carrier bill or your credit card. From a human standpoint, that’s not very dissimilar to what’s happening here, and from a metric standpoint, it’s almost exactly the same as what’s happening here.

In the U.S. last year, we had 93 percent penetration of mobile into the population, 43 percent 3G penetration into that mobile population, and devices that do those same things. We think that those devices, the unique blend of usability and capability, regardless of the underlying technology that they have in them, will fuel the same type of growth. And just on a population basis, Japan is about one-tenth of the population of the developed western world.

You could make the argument that maybe western consumers are not quite as obsessive as Japanese consumers can be. But there’s a really big market to take advantage of this. So it’s a marathon. We’re very focused on winning the marathon.

GamesBeat: When you’re building things now, what takes most of your investment? The network itself…is it built out?

Young: Yeah, the network’s pretty built out. As the network scales there are more capital investments we have to make. We always roll our network over to the cloud, so we sort of operate a private cloud and then roll over to the more public cloud so we can handle peak capacity. If there’s ever a problem we can make sure that the service stays up. As a company, Ngmoco basically operates three business units in the west.

The first would be our first-party studios. We’re creating games that try to take full advantage of what we know about these platforms, what we know about customers, and the learning that we’ve been able to get as part of DeNA. So our own experience, combined with DeNA’s experience, that’s what first-party is about.

We have our third-party teams, which are dedicated to bringing developers to the Mobage platform and offering them the services they need to access audience and maximally monetize.

And then we have the platform itself, which is a blend of hardware and software, infrastructure and technology, that allows people to build titles that target a global audience across multiple platforms. So whether that’s the Mobage stack itself, which you can access through ngCore, or you can now access through a native software development kit (SDK), you can access through Unity, you can access through Unreal, or whether it’s actually using something like ngCore, that allows you to write once and deploy on multiple platforms and automatically get carriage across the network.

And then lastly, traffic management. We are developing the ability to acquire customers effectively, to make sure those customers are high-monetizing customers, and to be able to move them seamlessly around the network. These are all skills that we have and services that we offer to first-party and third-party studios.

Filed under: games, mobile

After Zynga, the second-biggest player on Facebook isn’t Electronic Arts anymore. It’s Wooga, a Berlin-based studio that has become Europe’s largest social game publisher with more than 49 million monthly active users on Facebook.

The company was founded in 2009 by Jens Begemann (pictured above), Philipp Moeser, and Patrick Paulisch with the goal of making games for everyone, including the mass market and not just gaming die hards. Since then, it has only published six of them: Bubble Island, Brain Buddies, Monster World, Happy Hospital, Magic Land, and Diamond Dash. With that portfolio, the developer grew its monthly active users by 185 percent in 2011.

Now Wooga has raised $24 million in venture capital and has grown to more than 150 employees.  The company now faces a number of strategic decisions, such as doubling down on Facebook or spreading out to platforms such as Google+ or Zynga.com. We caught up with Begemann at the recent Game Developers Conference in San Francisco. Here’s a transcript of our interview.

GamesBeat: What did you talk about at GDC?

Jens Begemann: The talk was basically [about what we learned] from the first three years of Wooga. We were asked by the organizers here, because we now have nearly 50 million monthly active users. They wanted to know, “Where did you come from? How did this happen? Why this growth?”

We’re not doing anything magical. We’re just doing work. But I tried to sum up seven lessons that we’ve learned over the last few years. One of those is to focus on making our games very engaging in such a way that people come back often. We emphasize that instead of virality.

I think some other companies have been complaining that the virality of Facebook is not what it used to be. I think for us what has worked is focusing on engagement and making sure people come back. Every new user…you need to treat them like a small gold nugget — try to keep them. If you keep all of these new users, you’ve made a gold bar.

GamesBeat: So how does something like Diamond Dash do that?

Begemann: In Diamond Dash, it’s many, many things that are in the small details that you don’t see. We spent months on fine-tuning. When you hit a group of diamonds, how long does it take for the new gems to fall down? How many points do you get? How difficult is it to get this in-the-row bonus when the whole game world is on fire?

Basically, if you know the theory of flow, the game has to be challenging but at the same time can’t become too difficult. We ensure that people — from the very first moment on but also if they have played for a very long period of time — always feel challenged. They always have the feeling that they are under control, and they can create their own experience. It’s kind of similar to a triple-A title but obviously much more simple. It’s really about all these small little improvements that make sure people come back over long periods of time.

And then, of course — one element is using the social elements of competition in a good way. If you compete with your friends for a gold medal, that’s more interesting than playing alone or playing with strangers.

GamesBeat: How does that game monetize? Are you buying energy to play longer?

Begemann: Yeah, you can buy energy to play longer. You can also buy boosts. If you want to beat your friends, you can buy some extra boosts and get a bigger chance to beat them. All of those things you can also can be earned inside the game, so there’s nothing that’s exclusive through paying money. But, like in core games, you pay for having that faster speed-up.

GamesBeat: Do you think that one monetizes well relative to other social games?

Begemann: In terms of absolute numbers, we’re very happy, because the game is so big: 18 million monthly active users. Even if revenue per user is not so huge, overall that’s big. But yes, in terms of revenue per user, it obviously doesn’t monetize as well as Kixeye’s games. I think they have a very different model. Much less users, much more revenue per user. For us it’s truly mass market. That has also been our philosophy since the beginning. First, reach a huge audience, and then build monetization on top of that, instead of the other way around.

GamesBeat: From observing that game, it seems so short to me that it’s really hard to monetize. I suppose you can find people who really just don’t want to stop. [Laughs] Normally I just stop when I run out of energy.

Begemann: Diamond Dash is just a minute. [You can visualize it like this:] It’s like a bag of chips, where each chip is just one bite, but if you don’t pay attention, you finish the whole bag.

Diamond Dash is similar. Each round is just one minute, but some people really play for lots and lots of time. People who play with their friends enjoy it more. Many groups of people play in their offices when they’re on their lunch breaks. Everybody during this half an hour plays Diamond Dash at the same time. This group of 10 people or so, they send free lives to each other. It’s a Facebook gifting feature, so they can play for longer. Some of them also spend money on buying power-ups. But a game like Diamond Dash is definitely super-mass market.

GamesBeat: Zynga has started running a lot of ads in Words With Friends. Is that an opportunity for you guys as well, especially in these games that don’t monetize automatically?

Begemann: We don’t reveal detailed numbers. But overall, I think people underestimate it. Because of these huge user numbers, it’s possible to monetize quite well. And regarding advertising, I think that’s a potential growth opportunity for the future, but at the moment we’re very focused on doing a small number of things. There are tons of opportunities that we have, but for us, we really focus on growing on Facebook, growing our user base there, and improving our monetization there.

The second big focus is mobile. Advertising would be a good, additional growth opportunity, but at the moment, it’s too much of a distraction for us. It would take away the focus from our key growth.

GamesBeat: You guys have become a strong company. There are a handful of strong companies out there, and they’re starting to pursue different strategies. Kabam’s is going onto six different platforms, while you guys are sticking with Facebook. You have moved onto Google+. Do you know how many platforms you want to be on?

Begemann: Our focus, really clearly, is Facebook, and on mobile it’s iOS [iPhone, iPad, iPod Touch]. We like being on a small number of platforms. We have a great relationship with Facebook, and we like the iOS platform a lot. And over time, especially on mobile obviously, there will be more. I think it’s quite natural to think of Android and potentially also Windows Phone — I think that’s quite natural, but on the PC, we’re really happy with Facebook. Other companies may go to other places, but for us, it’s the right platform to focus on.

Filed under: dev, games, social

Life under GameStop’s ownership has been good for Kongregate, one of the largest destinations for free indie games on the internet. But the changes that are rippling through the game industry are also buffeting both Kongregate and GameStop, the world’s largest operator of game retail stores.

One of the biggest changes is in how Kongregate generates money, Kongregate cofounder Jim Greer (pictured) told VentureBeat. During the past year, Kongregate doubled the number of virtual goods-based games on the site and tripled virtual goods revenue. Virtual goods now make up 80 percent of revenue. That shows that even web-based companies that are outside the sphere of Facebook can take advantage of the new business models that are disrupting the game business.

The company launched the virtual goods program around 18 months ago and has had to keep updating its capabilities, adding achievements and rewards. It has made its site more social and, at the Game Developers Conference last week, launched a new batch of social applications programming interfaces so developers can take advantage of things such as game activity feeds, which will show up on a user’s profile page and on the Kongregate home screen. Those social features will help games spread by word of mouth more easily on Kongregate.

“We are doubling down on our belief that there is a place on the web where players who are serious about games can come gather, socialize, and play,” Greer said.

All told, Kongregate has 50,000 games available, most of them free or free-to-play (where users play for free and pay real money for virtual goods). Most of the 15.5 million users are hardcore gamers, but they’re the kind that prefer free indie games. Those who come to Kongregate via GameStop’s stores spend about seven times more than a typical web gamer.

Another big change that will hit Kongregate is new competition from Zynga, which has launched its Zynga.com online game site for people who are really into social gaming. Zynga will publish third-party games from outside developers and publishers such as Rebellion and Konami.

“Their motivation is to create a better experience for games on their own site,” Greer said. “That is what we have discovered as well. As the viral channels have turned down on Facebook, more game developers are willing to move off Facebook to the web. Facebook is a place to socialize and play games. We’re the opposite: a place to play games first, and then socialize. Kongregate is mostly about the games, just as Xbox Live is.”

Kabam, a major Facebook game developer, for instance, signed up to put its games on Kongregate. The difference between Zynga.com and Kongregate is that you can create your own gamer identity on Kongregate and play anonymously if you wish, whereas you’ll use a Facebook or Zynga real-world identity on Zynga.com. That means the two sites will likely attract different audiences.

As a division, Kongregate has 35 employees, compared to about 20 when it was bought. It has about 14,000 game developers. Kongregate takes a 30 percent split on transactions. But developers don’t have to spend money to advertise on Kongregate, since Kongregate promotes their games on its site.

Conversion rates, or the percentage of users who buy something, is about 1.5 times to 2 times higher on Kongregate than on Facebook. The gamers stay for a long time, so the cost of user acquisition and the lifetime value of Kongregate users is higher, Greer said.

The big hits on Kongregate include card-based role-playing game Clash of the Dragons (pictured at top), Wonderputt casual golf (pictured middle), and Defenders Quest tower defense role-playing game (pictured lowest). Asian online game publishers have published a lot of titles on Kongregate.

Kongregate has the benefit of being on display in GameStop stores, which get 500 million visitors a year.

“We’re getting a lot of traffic that way,” Greer said.

GamesBeat 2012 is VentureBeat’s fourth annual conference on disruption in the video game market. This year we’re calling on speakers from the hottest mobile, social, PC, and console companies to debate new ways to stay on pace with changing consumer tastes and platforms. Join 500+ execs, investors, analysts, entrepreneurs, and press as we explore the gaming industry’s latest trends and newest monetization opportunities. The event takes place July 10-11 in San Francisco, and you can get your early-bird tickets here.

Filed under: games, social, VentureBeat

Too often, I flit from one conference to another like a wayward butterfly, trying to catch up with all the news. But the Game Developers Conference is one of my favorite events of the year because it places such a high value on creativity in the game industry. It is fitting to dwell upon it and to figure out what this year’s conference in San Francisco, which ended Friday March 9, was all about.

It’s presumptuous to say that I could spot every trend, given my limited experience of the five-day event with more than 400 sessions. But here are some things I noticed.

The Gold Rush continues

This year, the Game Developers Conference (GDC) drew more than 22,500 attendees, up 17 percent from a year ago. That’s much better than the heart of the economic downturn in 2009, when attendance fell from 18,000 the year before to 17,000. The attendance boom is no surprise given the growth of the industry in 2011, which saw two mega-IPOs for Nexon and Zynga. Billions of dollars are being tossed at the game geeks who were once ostracized for having too many pimples. Last year, investments in game companies grew 96 percent to $2 billion in 152 deals. Game acquisitions grew 160 percent to $3.4 billion, according to Digi-Capital.

John Schappert, chief operating officer of Zynga, disagrees with those who say we’re in the Dark Ages of video games. In his GDC speech, he argued that we are living through another golden age, when play, the essential activity behind gaming, will reach a billion people. Such optimism is contagious in an age full of growth in the online, social, and mobile sectors, where new companies are sprouting every week. There are, Schappert said, “more ways to play, more players, more opportunities.”

The impact of this was visible on sidewalks clogged with recruitment hawkers on the sidewalks (pictured), and in the clogged career hall and the plentiful (and occasionally offensive) parties that took over all of the bars of San Francisco. There were huge numbers of indie-game developers. Against that backdrop, Schappert’s speech was believable.

Kickstarter blossoms

In keeping with our first trend, Double Fine Productions’ Tim Schafer has drawn huge attention to crowdfunding through Kickstarter by raising nearly $3 million from game fans for a new project. Schafer plans to make an adventure game with the money, as long as he doesn’t squander it all first. Kickstarter’s Cindy Au told GDC attendees how to get crowdfunding for their own projects.

The core retreats

Not everyone is benefiting from the Gold Rush. In the midst of the GDC, the NPD Group reported that core U.S. video game sales fell 20 percent in February, following a 34 percent drop in January. 3D artists in particular seemed to be losing their jobs at core console game companies, while 2D artists were in demand at the casual social game companies and mobile game firms. That may change as social and mobile games grow up. But it could be hard for some people in the industry to jump from a faltering horse to a faster one. A misstep can be costly. I ran into an acquaintance who was laid off from THQ, a struggling core game maker that is expanding into the new game industry. THQ has $47 million in cash, but its market cap has fallen to $41 million.

The iPad rules

This year, Apple crashed the party again. Last year, Nintendo’s chief executive Satoru Iwata gave a GDC speech at the very same time that Apple launched its Apple 2. Guess which company got overshadowed? This year, there were no GDC major keynote speeches, so Apple had the spotlight to itself as it launched the new iPad down the street. The reaction from game developers was positive. Not only is this a threat to gaming portables such as the ill-timed PlayStation Vita, it is also a threat to the consoles themselves. Accidental or not, Apple is winning over game developers and gamers alike. “The center of gravity has clearly shifted to mobile,” wrote Raph Koster, a seasoned game developer.

Free-to-play

Free-to-play, where users play for free and pay real money for virtual goods, is taking over as the business model for the whole game industry. Virtual goods revenues are at $9 billion and are the fastest-growing part of the $49 billion game industry. PopCap Games’ Giordano Bruno Contestabile discussed the lessons of moving Bejeweled Blitz to a free-to-play model at the GDC.

“The social/free-to-play model is clearly not just winning but dominant,” wrote Koster. But you have to do it ethically, without milking your users.

Mobile and social games go 3D

Browser-based game graphics have been mostly lame for a long time. That’s because it’s technically hard to run sophisticated 3D game animation through a browser without doing a big download first. But Adobe’s upcoming Flash 11.2 will enable Flash-based browser games to tap 3D graphics hardware in a computer as needed. Even Epic Games’ Unreal Engine 3 will work inside the new Flash, as announced by Epic’s Mark Rein (pictured). Other 3D-capable technologies such as Google’s Native Client for Chrome browsers and Unity Technologies Unity 3D engine are also coming into their own.

Game jams

Game jams are creative gatherings where creators work furiously to create a game in a short time and share it with the crowd. These events have been around forever, but they’re starting to yield interesting fruit. Last year, Double Fine Productions held a game jam that led to the creation of Sesame Street: Once Upon a Monster. It’s no surprise that just about everyone held a game jam at this year’s conference, and one session headed by Austin Montville of Tagged zeroed in on how to do it.

Retro rules

The GDC continued its waltz through yesteryear as top game developers reminisced about the games that inspired them. John Romero credited Pac-Man for inspiring the corridor warfare of Doom and Quake, while Sid Meier lauded Dani Bunten’s The Seven Cities of Gold for inspiring Civilization, and Will Wright was inspired by Pinball Construction Set before he built SimCity (which also got a second life). Romero spent $200 a month playing Pac-Man.

Ed Logg talked about creating Gauntlet. That was relevant because the classic games of the golden age of video games has returned, only this time to the platform of smartphones and tablets. Those devices are the ideal vessels for the creativity of designers like Logg, who has joined Innovative Leisure, a collection of Atari veterans and youngsters intent on making well-designed mobile games.

Emotion and love

The wrong end of a gun has inspired much of the emotion in video games. But a session on making love, not war, in video games proved to be popular with both male and female game developers. Moderated by Jane McGonigal (pictured at podium) and Jane Pinckard, the session focused on “how designing for love can change the world.” Michael Molinari, an indie game maker, talked about how he and Chelsea Howe created a game called The End of Us about two comets that fall in love and then deal with the death of one of them. Making love games is not a trend, given 5,000 years of violent games have preceded this panel. But the organizers hope it will be a turning point.

Casino game bandwagon

Big Fish Games joined the casino game wars as it acquired Self Aware Games, a maker of mobile casino titles. Big game companies are positioning themselves for the day when online gambling is legalized across the country, and casino games can become real gambling platforms. The trouble with casino games is that they aren’t necessarily that creative, and game developers get bored making them. Alisa Chumachenko, chief executive of Russian game publisher Game Insight, sighed with frustration at the mere mention of revival of casino games.

Copycats are evil

It’s one thing to be inspired by another’s work, but another thing to copy it. Even as creativity is celebrated among the indie developers making apps, its evil nemesis copycatting has become worse than ever in mobile and social games. Even the New York Times weighed in on the subject, which we discussed with Zynga chief executive Mark Pincus in early February. (Yes, indeed, they must have copied our story!).

The best way to counter copycats is to double down on creativity. Martin Rae, president of the Academy of Interactive Arts and Sciences, said, “There are very original ideas, and sometimes the best ideas are iterations on the old ideas. Sometimes people are just too early with their ideas. People iterate on that idea and do something better.”

Waiting for next gen?

Lots of people wanted to hear the latest rumors about the next-generation video game consoles. There were plenty of those to go around, including one that suggested the next Xbox would have no disk drive and would be entirely online. Alas, the confirmations just aren’t coming yet.

GamesBeat 2012 is VentureBeat’s fourth annual conference on disruption in the video game market. This year we’re calling on speakers from the hottest mobile, social, PC, and console companies to debate new ways to stay on pace with changing consumer tastes and platforms. Join 500+ execs, investors, analysts, entrepreneurs, and press as we explore the gaming industry’s latest trends and newest monetization opportunities. The event takes place July 10-11 in San Francisco, and you can get your early-bird tickets here.

[Photo credits: Dean Takahashi]

Filed under: games, VentureBeat

Call of Duty Elite is turning out to be a highly engaging social network for hardcore fans of Call of Duty: Modern Warfare 3. The online social network now has more than 670,000 clans, or groups of players who team up in multiplayer battles, according to Activision Blizzard’s Beachhead Studio leader Chacko Sonny (pictured center).

In an interview at the Game Developers Conference, Sonny said the numbers show that clan operations have become really big, as each clan can have up to 100 members. The clans are one of the primary ways to make the game “sticky,” since players who battle together for a long time are more likely to keep returning to the blockbuster game, which has sold an estimated 25 million copies and is the best-selling video game of all time.

With the clans, leaders can create uniforms with the group’s own national flag and other details so that each member of the clan plays with the same uniform in battle.

“It becomes like a soccer club,” said Noah Heller, product director (pictured right) of Call of Duty Elite.

Activision hasn’t shared the latest numbers for Call of Duty Elite. In February, the company said that 7 million players had signed up to become Elite subscribers since the game launched in November. Of those, 1.5 million had signed up to pay $49.99 a year to become premium members of Elite. That entitles members to get all of the downloadable content for free. The revenue from such subscriptions made a small contribution to Activision Blizzard’s digital revenue in 2011, which amounted to $1.6 billion. Full told, Elite will have 24 content drops in 2012. Content drops 4-6 are available today.

Call of Duty Elite was controversial when it was first proposed because fans feared that Activision would begin charging money for things such as multiplayer play that were previously free. The service also had a rocky launch. But now that it’s up and running, Activision believes gamers are coming around.

Heller said that clans were so popular that when Activision turned on the feature, 40 clans were formed in the first 30 seconds. That means users were constantly refreshing the page for forming clans as they awaited the new feature.

“They were hitting refresh, refresh, refresh just to be the first ones to form a clan,” Heller said.

Sonny said the service — which had a rocky start as the number of users overwhelmed Activision’s servers — is back on track and widely available to users now.

Clans can earn achievements and grow in levels over time. They can grow up to level 50, a number which shows when a user looks up a clan’s status. In one challenge, Activision had clans play the Domination version of the Modern Warfare 3 multiplayer game over three hours. At the end of it, they ranked the top six players. More than 25,000 clans with 200,000 players participated in the challenge.

Activision had to spin up a large live operations team to monitor the clans for possible cheating, Heller said.

“The clan operations are a way for players and teams of all capabilities to get in there and compete for bragging rights,” Sonny said.

The company has run a number of contests for both digital and real prizes now, giving away prizes such as iPads, Xbox 360s, and Astro audio headphones. So far this year, the company has run 300 competitions.

Jamie Berger (pictured top left), vice president of digital at Activision, said the company will soon start “100K days,” a monthly event where it gives away $100,000 worth of prizes to winners of competitions and events. The prizes will range from simple Modern Warfare 3 swag such as a hoodie to ATVs, Jeeps, or scuba diving trips.

“This is the kind of stuff that engages the really serious player,”

Activision is also rolling out more Elite TV shows on Call of Duty Elite on the consoles. Previously, it was a technical challenge to serve a lot of videos to fans. Map videos show players how to tackle each map. The videos feature things like celebrity grudge matches of TV stars Michelle Rodriguez vs. iJustine. A new season of Friday Night Fights, a challenge show directed by Ridley Scott, is in the works. Other shows debuting are Noob Tube and Cocked Hammers.

The new Call of Duty Elite mobile app for Android and iOS has been downloaded more than 2 million times, Berger said. With that app, players can set up their own weapons kits and save them so that they can use them in actual multiplayer games. Tablets support and a version 1.2 update are on the way.

“We tailored the app to the strengths of the mobile platform,” Sonny said. “And then we will apply the lesson to the tablet in the future.”

The company has plans to release a magazine called Drop Zone to describe the downloadable content. Several Activision studios — Infinity Ward, Sledgehammer Games, and Raven Software — are all working on new content, Berger said. Altogether, Activision will release 24 content drops this year for Call of Duty DLC, up from a planned 20.

The next major version of Elite will come with the next game, which will presumably be Call of Duty: Black Ops 2.

GamesBeat 2012 is VentureBeat’s fourth annual conference on disruption in the video game market. This year we’re calling on speakers from the hottest mobile, social, PC, and console companies to debate new ways to stay on pace with changing consumer tastes and platforms. Join 500+ execs, investors, analysts, entrepreneurs, and press as we explore the gaming industry’s latest trends and newest monetization opportunities. The event takes place July 10-11 in San Francisco, and you can get your early-bird tickets here.

Filed under: games, social, VentureBeat

Acer has begun selling a new Ultrabook (thin laptop) with a new Nvidia graphics chip.

The new machine is the first Ultrabook that has a stand-alone graphics chip in addition to the integrated graphics in the laptop’s Intel chip. That means the new computer will be thin, light and still be able to run outstanding graphics in games such as Battlefield 3.

The new Acer Aspire Timeline Ultra M3-581TG laptop is a powerful computer with Intel’s Sandy Bridge microprocessor. It also uses a discrete graphics chip from Nvidia under the name GeForce GT 640M. The graphics processing unit (GPU) is based on the upcoming Kepler architecture which Nvidia plans to reveal in the near future. The chip has 384 processor cores running at 625 megahertz.

Epic Games referred to the Kepler graphics chip when it showed a system running its “Samaritan” demo, a spectacular 3D graphics showcase animation, last week at the Game Developers Conference. Mark Rein, vice president at Epic Games, said the graphics card was so powerful that it could run the Samaritan demo with one card. A year ago, it took three Nvidia GeForce GT 580 graphics chips to run the Samaritan demo, which is designed to give people an idea of next-generation gaming.

Filed under: games, VentureBeat