AGDC 07: Interview with Raph Koster

Rewind one and a half years: Raph Koster was the Creative Director at Sony Online Entertainment, a monolithic company specializing in big budget, 3D MMORPGs. In March 2006, Koster left SOE to pursue something new and founded Areae Games. Now, he’s the mind behind Metaplace, an MMO fused with social networking driven by player created content. It’s the antithesis of a AAA MMO. At AGDC, Koster explained his thoughts and observations on the industry, where it’s headed and why he thinks his personal shift in trajectory is the wave of the future.

At the turn of the century, games like Ultima Online and EverQuest had moved to the forefront and replaced a generation of text-based MMOs, better known as MUDs. It was the inevitable advancement of technology that enabled designers to create what before had only been possible through words and recast it with pictures.

However, just as the advent of motion pictures hardly replaced the book, that wasn’t the end of MUDs. They’re by no means huge money draws, but many of them continue to have strong user bases to this day. Nonetheless, they were clearly replaced in terms of popularity, investment and developer mindshare by the graphical MUDs we now call MMORPGs.

“I think the big MMOs,” mused Koster, “in some ways, they are becoming the next text games.”

It’s a radical statement from a man whose opinions run contrary to many of the other respected names in this industry. During AGDC, he was on the usual panel of industry leaders and as per usual, he showed his fundamental disagreement on where gaming is going.

While most big MMO companies continue to chase the golden ticket of World of Warcraft, Koster has done a 180 from his days at SOE, believing there’s a bigger pie to be sliced. Koster believes in the web-based game market.

“AAA MMOs do not realize that the genre has passed them by,” he told us. He points out, accurately, that a host of web-based “MMOs” already boast much larger player numbers than World of Warcraft, and laments people talking only about graphical AAA games at conventions like AGDC.

For many, these AAA MMOs are the wave of the future. Koster points out that the accepted wisdom in the industry is that PC games are dead. Walk into the local GameStop if you don’t see why people say that. More and more in retail, console games dominate. That’s why big MMOs are so attractive to big publishers, they cannot be pirated and are the last PC genre that doesn’t have a viable console alternative. Almost every other genre has been translated to the consoles, which is a much more stable platform for developers.

Koster points out that people overlook what may be the most stable platform of all: the Internet. Consoles themselves actually become more and more PC-like every time a new generation comes out and eventually, they might well be the same thing. In the meantime, people play web-based games on a scale the Xbox 360 and the Nintendo Wii games cannot even compare to.

Koster brought up a historical parallel to the shift he envisions for the game industry. At one time, railroads we’re the life blood of the United States. People got insanely rich simply by moving things from one place to the other.

“These guys were hardcore about railroads,” he quipped.

Eventually though, that generation of technology ran its course and companies were forced to evolve or become irrelevant. It happened when some railroad owners realized they could standardize and index their containers so they could easily go from land, to sea. Those that used this system – still in use today – became insanely rich beyond imagination. Those that did not, died off.

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He believes AAA games face the same kind of crossroads. They’ve become so expensive to produce, the margin for profit so thin, that they need to consider other options. He’s 100% certain the major AAA publishers will eventually move to web-games and in fact, the shift has already begun. Many new retail games are promoted on their websites with small, casual mini-game versions.

Pushing the switch further, piracy will become more of a concern than it is already. In North America, piracy is mitigated by the sheer size and complexity of the act. Unlike a song, which is 3mb and can run in a variety of players, or a movie which is 700mb and requires a double click to operate, video game piracy doesn’t quite hit the mainstream because they’re several gigs in size and most grandmothers likely cannot operate Daemon tools.

As download speeds grow to those enjoyed by other countries where piracy runs rampant and those hackers get more sophisticated, that gap will disappear. Like the music and movie industries before them, games will need to get creative to survive. Koster sees his solution.

“MMOs should be free to play,” he told us. “The value lies in the service, not the content.”

It makes piracy unnecessary and is exactly how they fight the problem on the Asian market where illegal games can be purchased on street corners.

The shift from retail is not a new sentiment; every CEO we spoke to at AGDC seemed to believe that eventually they’d distribute their games exclusively through the digital medium. But, the price model and value are not yet accepted by all.

While many developers don’t yet buy into his ideas on pricing, they are moving more often to self-distribution, often online. Koster points out that the game developers in the MMO space are slowly becoming the big publishers. SOE, for example, is a portfolio of games. Turbine CEO Jeff Anderson said he would one day like to see his games distributed exclusively by his company. Mythic got absorbed into EA to run their MMOs.

On a smaller scale, a slew of companies have come from Asia and operate their own MMO platforms where multiple games are available through one website. All of these companies have either completely moved beyond traditional publishers like EA, or are in the process of doing so.

We asked him about the recent example of BioShock, which seems to fly in the face of everything he says. It’s a single-player only game, with huge production values and on a big console.

“We’re not far from a time when a single player game is like an instance,” he told us. “BioShock is just a single player instanced dungeon in the Xbox Live MMO.”

He points out that the platform, Xbox Live, links all the games together through achievements. Players are essentially “leveling up” their character through a wide range of games. BioShock is just a small part of the leveling.

So why should the AAA game go away and shift to the web? Market size is one reason. Games like Habo Hotel, Runescape and Club Penguin have huge numbers of players far beyond the league of every AAA MMO, save World of Warcraft, and most of them are bigger than WoW.

How’d they get so big? They’re easy to get into. Google them. Then play. No trip to the mall, no lengthy install, no pile of CDs. They’re also always able to run on just about any computer. A new pixel shader is not in the cards. Many argue these casual games are great, but they don’t appeal to the “hardcore gamer”. Koster disagrees. He believes that hardcore, console, Halo players also play these casual games. It just doesn’t flow in reverse.

So, how did Koster go from a creative head of one of the biggest MMO companies to a proponent of web games? He saw the cost and headache of making games the current way first hand and at the same time, his job took him to conventions full of web people.

The two industries – web and gaming – have a lot to learn from each other, he points out. On one hand, web people need lessons from the gaming people on how to increase the fun factor of their product. On the other, gaming people could learn some production lessons from the web people. It’s a two-way street Koster believes is rapidly merging. Many disagree with him, but if he’s right, the future of gaming looks a lot different than what many hardcore gamers are used to.

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