The video game industry has a love-hate relationship with NFTs
Posted onAuthorErnest J. HarperComments Off on The video game industry has a love-hate relationship with NFTs
NFTs, a supposedly artistic offshoot of the cryptocurrency market, are a hot topic. They’re also controversial, and thanks to an intrinsic connection to technology, one that was bound to intersect with gaming at some point.
We’re not going to cover the full breadth and breadth of non-fungible tokens in this article. Suffice it to say, these are digital receipts for works of art which, most importantly, are not actually the property or copyright of the art itself, and which can be transferred through the same type of cryptographic verification as Bitcoin. If you need a crash course in the concept, try this quick video from The Wall Street Journal…or maybe this more tongue-in-cheek one from Cracked and the Inevitable Follow-up.
If you are a fan of NFTs, they are a revolution in art monetization. If you’re not, this is a get-rich-quick scheme that attempts to strike the cryptocurrency thunderbolt twice, suffering from the same glut of peddlers and thieves that so often frequent the crypto markets. NFTs are controversial for a number of reasons: their impact on the environment due to the need for processing power for verification, the tendency of NFT vendors to pump out mass-produced “art” for serve a dubious market (or just steal some and sell it anyway), and the very concept of selling a digital certificate as a nebulous commodity and type of property.
A new kind of microtransaction
What do NFTs have to do with games? On the surface, not much. Introduced as a way to transfer ownership of specific works of art, non-fungible tokens aren’t really compatible with mass media like games, movies, or TV shows. But that hasn’t stopped some developers big and small from trying to get in on the craze – and make a quick buck while there’s an opportunity to do so.
The central idea of implementing NFTs in games seems to be mostly related to in-game items, usually a skin or item of clothing for the player’s avatar. These at least have something in common with the individual artworks mostly pushed alongside more conventional NFTs – Valve was selling community-made items in Team Fortress 2 a decade ago. As with other NFTs, these items can be sold and resold on the blockchain. But unlike other blockchain technologies, the fact that said elements actually rely on the game itself to function and hold their value means it lacks the decentralized nature that appeals to so many anarcho-capitalists. .
Sega was one of the first well-known publishers to express interest in selling NFT, registering a trademark for this purpose despite intense fan backlash. In the feverish scramble of 2021, Square Enix, Konami, Fable creator Peter Molyneux, whoever owns the “Intellivision” name these days, and even the creators of NeoPets got in on the action.
Ubisoft is an NFT cheerleader
But by far the biggest NFT cheerleader among the big game companies was, and remains, French publisher Ubisoft. The company has become the first major gaming figure to integrate NFTs into its own game with “limited” gameplay elements for Breakpoint from Tom Clancy’s Ghost Recon. Despite intense backlash from gamers and its own employees, Ubisoft seems determined to feature NFTs in existing and new games at the time of writing. In response to the backlash, Ubisoft made noncommittal statements of understanding, but refused to back down. Ubisoft recently licensed its Rabbids characters for the metaverse market The sandbox.
Square Enix is the other big publisher that also seems keen to jump on the NFT bandwagon. After an initial poll of support last year, company president Yosuke Matsuda said in early 2022 that he would continue to invest resources in the concept.
This all sounds bad, at least if you’re of the mainstream view that NFTs are poorly designed at best and outright scams at worst. And any casual observer watching the rise of microtransactions, battle passes, and “live service” games might assume the worst: that the industry as a whole can’t wait to jump on the latest trend that promises to big returns for little or nothing. to work. But you would be wrong. The industry, or at least a large part of it, seems to be as skeptical of the NFT “revolution” as the rest of us.
Most publishers and developers aren’t on board
Take EA as an example. Electronic Arts is usually the number one target of gamers’ ire who grow weary of AAA excesses and profiteering. But after initially calling NFTs “the future of our industry”, EA CEO Andrew Wilson told investors the concept is “not something we’re striving for”. He then compared NFTs to passing fads like 3D TVs.
And EA isn’t the only game maker to spin 180 on the concept. After announcing the player-avatar NFTs for the next STALKER 2developer GSC Game World listened to community feedback and reversed its stance, issuing a terse apology and dropping “everything NFT-related” from the project.
Phil Spencer, CEO of Games at Microsoft, called NFTs “more exploitative than entertaining”. At the Game Developers Conference last month, an overwhelming 70% of developers who responded to the State of the Gaming Industry Survey indicated that they were not interested in tokens no fungible. Even fewer wanted anything to do with cryptocurrency.
Perhaps the biggest denunciation of NFTs in the entire industry has come from Valve. The company banned games dealing with cryptocurrency and NFTs from its Steam storefront in October last year, shutting down the most widespread and lucrative ways to enter the PC gaming market. (Inevitably, the Epic Game Store says it will take NFT games that Steam doesn’t want.)
No fucking thanks
Taking this broad look at the biggest players in the industry, as well as the general reaction from developers as a whole, gaming seems to be at least shy of NFTs and a greater reliance on crypto-powered aspects. Which is surprising, given that AAA publishers can usually be counted on to try just about anything that might squeeze a few extra bucks out of their properties. It’s possible that the NFT craze has risen and fallen so quickly, and been accompanied by so many negative sentiments, that even the notoriously fickle gaming industry is giving up. A tangential relationship with cryptocurrency, the cause of so much woe for PC gamers who want a new graphics card, might have something to do with it.
The market for those who want gaming-related NFTs doesn’t seem to be suffering, as many indie developers fill the niche. But the consensus among major developers seems to be forming: NFTs don’t offer anything they can’t already do with existing tools. NFT sales remain strong, but a spending slump is looming in the speculative market, and it may not be long before the new guys in finance are looking for the next big thing. Despite exceptions like Ubisoft and Square, it seems we can put aside the fear of NFTs becoming ubiquitous in the gaming world.
Michael is a former graphic designer who has been building and modifying desktop computers for longer than he cares to admit. His interests include folk music, football, science fiction and salsa verde, in no particular order.
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