Microsoft's Acquisition Of Activision-Blizzard-King Rejected By The UK

Reuters is reporting that the United Kingdom will block the sale of Activision-Blizzard-King to Microsoft for $69 billion due to "concerns it would hinder competition in cloud gaming." Apparently, Microsoft's Game Pass didn't impress the regulators in the UK enough.

I decided to go visit UK government websites to get the reasoning. According to a press release from the Competition and Markets Authority, the main concern was the development of cloud gaming. 

The UK cloud gaming market is growing fast. Monthly active users in the UK more than tripled from the start of 2021 to the end of 2022. It is forecast to be worth up to £11 billion globally and £1 billion in the UK by 2026. By way of comparison, sales of recorded music in the UK in 2021 amounted to £1.1billion.

Microsoft has a strong position in cloud gaming services and the evidence available to the CMA showed that Microsoft would find it commercially beneficial to make Activision’s games exclusive to its own cloud gaming service.

Microsoft already accounts for an estimated 60-70% of global cloud gaming services and has other important strengths in cloud gaming from owning Xbox, the leading PC operating system (Windows) and a global cloud computing infrastructure (Azure and Xbox Cloud Gaming).

The deal would reinforce Microsoft’s advantage in the market by giving it control over important gaming content such as Call of Duty, Overwatch, and World of Warcraft. The evidence available to the CMA indicates that, absent the merger, Activision would start providing games via cloud platforms in the foreseeable future.

The cloud allows UK gamers to avoid buying expensive gaming consoles and PCs and gives them much more flexibility and choice as to how they play. Allowing Microsoft to take such a strong position in the cloud gaming market just as it begins to grow rapidly would risk undermining the innovation that is crucial to the development of these opportunities.

Basically, Microsoft's GamePass service was not deemed a sufficient solution to the issue for three reasons:

• It did not sufficiently cover different cloud gaming service business models, including multigame subscription services.
• It was not sufficiently open to providers who might wish to offer versions of games on PC operating systems other than Windows.
• It would standardise the terms and conditions on which games are available, as opposed to them being determined by the dynamism and creativity of competition in the market, as would be expected in the absence of the merger.

The conclusion the investigation came up with was to disallow the sale. The press release gave a rather lengthier explanation.

The CMA carefully considered whether the benefit of having Activision’s content available on Game Pass outweighed the harm that the merger would cause to competition in cloud gaming in the UK. The CMA found that this new payment option, while beneficial to some customers, would not outweigh the overall harm to competition (and, ultimately, UK gamers) arising from this merger, particularly given the incentive for Microsoft to increase the cost of a Game Pass subscription post-merger to reflect the addition of Activision’s valuable games.

Martin Coleman, chair of the independent panel of experts conducting this investigation, said:

"Gaming is the UK’s largest entertainment sector. Cloud gaming is growing fast with the potential to change gaming by altering the way games are played, freeing people from the need to rely on expensive consoles and gaming PCs and giving them more choice over how and where they play games. This means that it is vital that we protect competition in this emerging and exciting market."

"Microsoft already enjoys a powerful position and head start over other competitors in cloud gaming and this deal would strengthen that advantage giving it the ability to undermine new and innovative competitors."

"Microsoft engaged constructively with us to try to address these issues and we are grateful for that, but their proposals were not effective to remedy our concerns and would have replaced competition with ineffective regulation in a new and dynamic market."

"Cloud gaming needs a free, competitive market to drive innovation and choice. That is best achieved by allowing the current competitive dynamics in cloud gaming to continue to do their job."

The UK was not the final approval needed. The European Commission is set to rule on the sale on 22 May while the Federal Trade Commission in the United States has scheduled an administrative hearing on the case in August.

More Shadows For The Shadow War

Tuesday is patch day for EVE Online, which usually is accomplished in 5-10 minutes. Yesterday's patch notes included some news about improved graphics.

• Anti-aliasing has been upgraded. You will see smoother edges and the elimination of specular aliasing, which eliminates the 'shiny' effect that occurs in some situations.
• The shadow system has been entirely overhauled. Previously, there was a limit of 16 shadows in a scene, for casting and receiving. Shadows also look much sharper, and there is now no limit!
• The film grain effect has been refactored, reducing the 'grid' pattern that would sometimes be visible.

In addition, station hangars will no longer turn green when a specific advertisement runs on the large display. But that was just a bug. The other bits of news are enhancements.

An article went on to describe the exact graphical improvements down to the settings level.

How the client implements the graphical settings for shadows has also been reworked. Shadows will now always be rendered at all settings other than ‘disabled’, with the filtering of shadows being adjusted to allow a balance between quality and performance. Your entire visual experience will now also be much smoother thanks to new anti-aliasing techniques that smooth edges and improve textures for ships, stations and the landscape across New Eden. It also puts an end to "specular aliasing" which manifests itself as shimmering pixels, so you’ll now be able to appreciate the contours and textures of your spectacular ship in all its glory when flying around in space. The new anti-aliasing implementation moves us away from an older method which included MSAA (Multisample Anti-Aliasing) to a pure TAA (Temporal Super Sampling Anti-Aliasing) approach.

Due to an entire rewrite of how anti-aliasing is calculated and with several optimizations, performance is around the same as before, even with this better image quality. However, due to the change in how anti-aliasing is generated, it does come with a small caveat: low / medium AA is no longer available when using low / medium shader settings. This is currently a technical limitation due to how the game is rendered at the moment but will be revisited at a later date.

I really do need to upgrade from the computers I purchased in 2016 to run the Oculus Rift when EVE: Valkyrie came out. My best computer right now is the laptop I purchased after I had to move into a hotel when my condo flooded. I didn't log into EVE last night to check out the new graphics because I was installing GEForce Experience because I finally got tired looking at the washed out graphics in Final Fantasy XIV. With Freestyle freshly installed, I should log into EVE and update my settings so I am not using the same ones for both games.

NetEase Is Not Suing Blizzard After All

I'm almost afraid tomorrow I will have to clarify today's post. Yesterday's post concerned NetEase's lawsuit against Blizzard Entertainment. Today I have to write about how NetEase isn't suing Blizzard after all.

Blizzard replied to inquiries from Jiemian News about the lawsuit with the following statement.

“Blizzard has not received relevant complaints, but we believe that we have not violated any licensing agreement. NetEase’s suspected dissatisfied contract terms involve standard industry practices, and in the past few years It is mutually beneficial for both parties. Although these persistent behaviors make us feel disappointed and confused, It should be pointed out that the nearly 20 years of operation in China has been very positive and pleasant, and we will continue to be committed to serving local players and protecting their rights and interests.“

But then Wowhead did some research and questioned the entire idea NetEase sued Blizzard. The site specializing in World of Warcraft found that the docket had changed and NetEase was no longer listed as a party to the suit.

Like I mentioned at the beginning of the post, I'm almost afraid I'll need to post a third article explaining the whole chain of reporting events. But for now, Blizzard is being sued in China. Just not by NetEase.

NetEase Is Suing Blizzard Entertainment for CN¥300 Million

A really quick note about an ongoing situation that escalated to the Chinese legal system. NetEase is suing Blizzard Entertainment for a reported CN¥300 million, or USD$43 million. The original news site, Sina Finance, reported that NetEase paid refunds to 1.12 million players due to Blizzard pulling the games from NetEase's control in the People's Republic.

The lawsuit is seeking redress of additional damages, such as refunds for deposits the game company made to secure the rights to several games the American game studio never released and compensation for unsold merchandise. 

At this time, I'm interested in the effect the lawsuit will have on the upcoming sale of Activision-Blizzard-King to Microsoft. I'm pretty sure that with the billions Microsoft is willing to pay for ABK, and additional $43 million settlement is money the American tech giant can find somewhere in the couch pillows.

A Shadow War Event Update After 5 Weeks

A little over a week after the launch of EVE Online's Shadow War event, I gave an update on how each faction was progressing with their turn-ins. After 9 days, the Amarr, Caldari, and Minmatar were 4-5% of the way towards completing either Transport Relay Development (Amarr and Minmatar) or Stellar Transmuter Development (Caldari). The Gallente, starting from behind, only had progressed 5.8% through Stellar Transmuter Development and 1.9% through Transport Relay Development.

Factional Warfare Status: 21 April 2023 @ 1330 UTC

The Amarr are making the slowest progress with Transport Relay Development only 26.5% completed. Fortunately for them, their bitter enemies the Minmatar are not doing much better development at 31.8% completed.

The other pair of empires are making much more progress. The Gallente are still far behind, but have progressed Stellar Transmuter Development to 52.8% complete while almost catching up to the Amarr and Minmatar in Transport Relay Development with 22.4% complete. The Caldari are in the clear lead with Stellar Transmuter Development at 79.9%.

At the rate the Caldari are progressing, the faction will unlock Interstellar Shipcaster Construction during the week of 30 April to 6 May. That Saturday is the 20th anniversary of the launch of EVE Online.

I don't know how others feel, but I really hope that the slow progress players are making in the event will not delay the launch of the next expansion. I suspect shipcasting technology will play a major role in the upcoming, as yet unnamed expansion for EVE. The question now is, will the developers step in to make the process go faster, or let events take their natural course?

Is The Final Fantasy XIV Club Scene Moving To Kick.com?

Watching the news, one might get the impression the chat application Discord is only for leaking classified documents. Not so. Discord is a free-to-use app which keeps gaming communities together. I received a notification from one of those communities this morning, the Sugar Rush DJ Team.

Final Fantasy XIV has a robust club scene fueled by the game's housing and glamour systems as well as large selection of dance emotes. Dancing in a video game? That's right. In addition to two NPC run locations that qualify as clubs, players create their own, including hiring bartenders, waitresses, bouncers, and DJs. Up until now, the DJs operate on Twitch, playing music that club goers can dance to. Or at least, run their dance emotes while cooking dinner.

This morning, DJ Dollipop, the founder of the Sugar Rush DJ Team Discord server, sent out a server-wide ping with news about Kick.com, a new competitor to the Amazon-owned Twitch.com.

With Kick.com up and coming, we decided to start reserving our names and planning a “kick off” event to give it a try. 

Why do you ask? Well Twitch takes 50% of yalls hard earned money with every sub you drop on anyone. Meaning your $100 worth of subs , you pay $50 to Twitch. 

Kick on the other hand pays the streamers 90%, so your $100 you just dropped goes a long ways, almost double. A lot of the streamers in our community do this for a living. So even if you decide to not support kick, think of hitting that donate button or using bits instead. This is not me saying everyone will be moving over to Kick. This is us preparing for the “just in case”. Y’all know me, plan for the worse hope for the best and get ducks in a row. So! 

Head over to kick, make ya selfs a account and drop ya link in here for everyone to cross follow and help each other out!

While FFXIV DJs don't have the viewership of say, mind1 during EVE Online's World War Bee 2/Beeitnam War, FFXIV DJs are certainly more plentiful. As of this morning, 47 DJs have a channel on the server for club owners to book performances. And in the new kick-handles channel, 17 DJs have posted their new Kick.com accounts.

I'm not sure if Kick.com will succeed where so many Twitch competitors have failed in the past. But club goers who want to listen to a DJ may see new URLs pop up.

The Moogle Treasure Trove Event For Spring 2023

Finally some news that doesn't lead to thoughts of Web3 games and cryptobros even if the news originates with Square Enix. Starting next Tuesday Final Fantasy XIV will host a Moogle Treasure Trove event until the launch of patch 6.4. The event should run roughly four weeks, but Yoshi-P usually leaves the date open until he announces the launch date on a live producer's letter.

One of the more interesting features are the dungeons and raids awarding the most rewards. As usual, The Praetorium will award 7 tomestones. But the other raid awarding 7 tomestones is The Tower at Paradigm's Breach, the final stage of the YoRHa: Dark Apocalypse raid series. The first two stages, The Copied Factory (5 tomestones) and The Puppet's Bunker (6 tomestones) and the next two highest reward instances players can run.

I am sure that min-maxers will argue that other dungeons produce more tomestones per hour. But with the rewards for running the YoRHa: Dark Apocalypse high, I imagine the developers are trying to help newer players get the 2B gear set, which is in demand for glamour purposes. While the basic 2B set is the most popular, other role specific gear is also popular.

The list of rewards for tomestones is highlighted by the new Porxie earrings for 100 tomestones. The top mounts available for 50 tomestones are the Magitek Predator, Ixion Clarion, and Megalotragus mounts. The list also includes outdoor furnishings like the Red Brick Kitchen, Nomad Tent, and Oriental Wood Deck usable when Island Sanctuaries will allow the placement of up to 90 outdoor furnishing items. Personally, at the lower end of the reward list, the extremely cute Black Hayate, usually available from Shadowbringers' first MSQ dungeon, is a bargain for only 7 tomestones.

I don't have a problem trying to figure out what to do for the last month of patch 6.3, but I am a rather casual player. Still, I never did finish the YoRHa: Dark Apocalypse raid series and some of the rewards, like the Magitek Predator and Ixion Clarion mounts are very tempting. I probably will dive into the Moogle Treasure Trove event for a few weeks until I meet some goals I didn't really know I wanted to fulfill.

Tax Day Thoughts On Crypto In MMORPGs

On Saturday I filed my federal and state income tax returns. By file, I mean I opened up the H&R Block software, let it import most of my financial information, did a little additional entry, and hit the send buttons. I noticed a section I had never seen before. Did I convert any cryptocurrencies into real life money in 2022? I can't get away from the subject, can I? 

The idea that the government wants to tax cryptocurrencies is another reason to avoid all these web3/blockchain games popping up all over. Do I really want to play a game in which the government has an interest?

I know that a lot of people want the government more involved in regulating video games. I remember the bad old days when those who really don't like video games decided games were too violent and the government needed to step in. I really shouldn't write in the past tense as politicians continue to blame violence in video games for mass shootings in the United States. 

Another subject I've seen many games journalists and content creators advocate government regulation of gambling within video games. Looking back, the gambling issue was a vector many saw as attacking lootboxes in video games. I'm pretty sure many cheered as the Washington State Gambling Commission went after Valve for skins gambling in connection with Counter-Strike: Global Offensive back in 2016. Some of those same people are complaining that Valve's countermeasures are a little overzealous in 2023. But hey, Valve is going what the government wants, so it's okay, right?

Which now leads to the Web3 craze in MMORPG development. As I saw while preparing my tax returns, the federal government wants its cut of the cryptocurrency market. Then again, the Internal Revenue Service wants its cut on everything. If the IRS is readying an effort to increase enforcement against bartenders, waiters, and others who receive tips, what makes anyone think that eventually cash-hungry governments around the world won't become interested in all these crypto games popping up? Especially if people call on government to "Do something!".

In all honesty, the tax issue is probably the biggest obstacle to my playing one of these Web3/blockchain games like Project Awakening. At the very least, such a game will need to have robust cryptocurrency tracking and reporting features to deal with government agencies demanding a cut of my in-game revenue.  But do I really want to report what I do with my free time to the government? Especially what I do inside a video game? For the makers of these Web3/blockchain video games, you have a high bar to clear.

Star Citizen Alpha 3.18.1 Is Now Live

Since I wrote about the problematic launch of Star Citizen's Alpha 3.18, I figured I should close the books on the subject and cover the end of that episode. Last night (or early this morning depending on your time zone), Cloud Imperium Games deployed patch Alpha 3.18.1. If the status board is any indication, with much better results.

The status of Star Citizen as of 1300 UTC on 13 April 2023

As stated before by CIG, Alpha 3.18.1 comes with a server wipe as will the following patch Alpha 3.18.2. With the launch of Alpha 3.18.1, CIG plans a free-fly event. The details were left by a developer on the Star Citizen forums, along with an update.

The much-awaited release of Alpha 3.18.1 is set to launch later today. While we know that this incremental update is not a silver bullet, we expect that it will bring solutions to some of the ongoing issues some of you have been facing. The team has implemented a tremendous number of fixes in the last few weeks, and we believe that the infrastructure is now ready to go through heavy testing with all of you.

If you're one of the ones who has said "This is the worst Star Citizen has ever been"...then hold our beer, as we plan to launch a Free Fly event starting Thursday, April 13 through April 20. Jokes aside (I just wanted to be the first one to make the meme), launching a Free Fly event is a beneficial move for us, as it allows us to test the game's infrastructure with a larger number of players. More players mean more data, which helps us identify and fix problems more quickly.

This is particularly important as we continue to improve the game, and we want to make sure it can handle the increased traffic that comes with a rapidly-expanding playerbase. We also need to ensure that the game can handle peak-traffic moments, such as the Invictus Launch Week Free Fly we'll host in late May. Separately, we want to give everyone a chance to experience the latest gameplay additions in Alpha 3.18, such as the new locations, new race tracks, and more. Regardless of any previous issues, we hope the Free Fly will provide an opportunity for people to explore and enjoy everything Star Citizen has to offer, thanks to the latest fixes in 3.18.1.

Naturally, as has been the case since 3.18.0 launched, things have been very fluid for us, meaning there is a chance this planned Free Fly may see a last-minute cancellation. We've conducted days of automated load testing to simulate peak traffic on our login service, and our login and entitlement fixes have held up to that volume. However, in the event that we experience catastrophic issues upon rolling out 3.18.1 to the live servers, we may need to pivot away from the planned Free Fly and instead focus all our efforts on addressing and resolving the issue at hand. In any case, our top priority is to keep you all informed, and we will provide updates as soon as we have new information to share.

Most importantly, we'd like to thank all of you for your support and understanding during the recent turbulence we have experienced. We believe that these moments, alongside the positive ones, define the journey we are on together. See you in the 'verse!

Now back to business issues. The $2.2 million in sales recorded by CIG in the first 12 days of April is far behind the pace of sales in April 2022. A year ago, CIG recorded $7.7 million in sales. A free fly event should help CIG financially try to maintain pace with last year's record $113 million in sales. The server wipe may also help, although with one performed just a month ago, the whales may still be full digesting last month's meal.

With the deployment of 3.18.1 I should return to just covering the project's financial state. I do have to admit that, as Star Citizen is financially the biggest sci-fi MMO on the market, I may wind up comparing Star Citizen to CCP Games' Project Awakening in future posts. But as for now, Star Citizen seems back on track and playable again.

Is The End Of EDDB A Lesson For Project Awakening?

With a16z's interview with CCP CEO Hilmar Veigar Pétursson, the thought of monetizing third party applications has come to the fore. Project Awakening is going to rely, in part, on gas fees to fund the game and fuel the cryptocurrency economy. But let's look at games at the other end of the spectrum. Games that need the third party apps but don't really want to support them. According to videos I've watched over the past 24 hours, one such game is Elite: Dangerous. Last week, perhaps its most important third party website closed its doors.

The website in question is Elite Dangerous Data Base (EDDB). To give EVE players an idea of the state of Elite: Dangerous' in-game tools, imagine that instead of going to a regional market board to look up market details, players had to visit each individual station. That is what players in ED have to do. Or did until the creator of EDDB opened the doors to his application in 2015. And perhaps now will have to do again.

Several videos are up on YouTube describing the situation. The one that caught my attention was by TheYamiks, although I'll embed the video from ObsidianAnt as I feel it gives a more succinct explanation of the situation.

The developer Themroc left a farewell message on the website. I thought some of his thoughts merit saving considering the ideas floating around today.

Right after the launch of Elite: Dangerous I noticed that good 3rd party tools were rather scarce and so I quickly realized that I wanted to develop a tool to find profitable trade routes in particular. At that time we didn't have access to Frontier's API or the Journal and had to acquire all price information via image text recognition (OCR). This was, of course, extremely error-prone. Even then, the main work in developing EDDB was to clean up data errors.

Over the years, we as a 3rd party community have received more and more support from Frontier Developments, and they deserve thanks for that. Unfortunately, it was often the case that we also had to fight hard for one or the other concession. Personally, I always felt like Frontier was just putting as much energy into support as was just acceptable. To date, some data points such as powerplay updates or installation information are simply not provided and have to be painstakingly and error-prone manually entered via self-created backends. And the data, which is provided, is regularly incorrect or faulty. It was and is frustrating.

With EDDB, I developed the platform through which a lot of data was collected, and what actually annoyed me the most was the fact that I could never really focus on developing great applications with the data, but that it was primarily about getting and cleaning this data first. Because that task alone was immense with my own very high standards for quality. I hope this also explains why running the website is not just a matter of hosting, but requires a lot of effort.

The reasons why I quit EDDB are complex and my personal development plays the main role here. But Frontier Developments is not entirely innocent in this. I know that other game developers shower their 3rd party community with support. Unfortunately, I often felt the contrary with Elite: Dangerous.

From what I gather, CCP Games showers support upon EVE's third party development community compared to what Frontier Games provides with Elite: Dangerous. But the story of EDDB leads to concerning thought for games like Project Awakening. Will developers, in order to get those sweet, sweet gas fees, skimp on adequate in-game tools in order to encourage third party developers to step in? And if so, what happens to a company's revenue stream when key third party developers decide to move on with their lives? Hopefully that is something that CCP Games and those wishing to emulate that model remember and take into consideration.

Project Awakening, Third-Party Development, And The Blockchain

I possibly found the CEO of CCP Games Hilmar Veigar Pétursson's interview with folks from a16z a bit more interesting than most gamers. I believe as someone who plays video games I was supposed to just automatically write off the interview as blockchain/web3 nonsense and ride off grumbling about out-of-touch people with way too much money in their pockets. But I also write about video games, so when I hear a use-case for the blockchain in video games that doesn't involve real money trading, I sit up and take notice.

EVE Online relies on a community of third-party developers to add functionality to the game that CCP doesn't provide, or didn't until recently. Everything from maps and skill planners to the tools to manage EVE's huge player-run corporations and alliances. When Hilmar refers to the EVE infrastructure written by thousands of coders found on GitHub in the interview, those are the types of projects he referred to. While the ability to charge a real world monetary fee to use a jump bridge network makes headlines, the out-of-game infrastructure that makes EVE playable is of greater value.

The answer I found most intriguing in the interview was Hilmar's answer to the question, "...how does leveraging blockchain technology actually make for a better game?" The first part of the answer made reference to third-party development in EVE Online. If Project Awakening is actually EVE 3.0, as Hilmar implies, then we have a new use-case for the blockchain in gaming. I've transcribed Hilmar's answer below (Some editing has been done to make the answer more readable in text form).

There are a few elements where I could hand-to-heart say it’s a better substrate to do certain things. Number one, there’s a lot of third-party development around EVE Online. It largely takes place through an API gateway. So we have a database which is our persistent storage. Then we have the ability to access that persistent storage through an API gateway which is kind of controlled by keys. And if you have the keys you can sort of execute on behalf of another person and you can kind of get through the API and get through to the data and compose the data, etc. 

Currently we don’t really allow many reads through this system. It’s really only rights and the reason why we are kind of at that level is the pattern is quite powerful. But it does have limitations like metering the amount of executions it can do, etc, etc. So smart contract blockchains actually are a pretty good model where people could create third-party code that runs coexisting with other third-party code under the gas economy that exists on blockchains. That helps with kind of people writing messy code that just costs too many opcodes and things like that. 

So pay for your own execution is actually a useful construct to meter third-party development in an open way in a large persistent storage. This combined with the memory interaction model between smart contracts and the underlying kind of state. I mean it’s a little bit problematic for blockchains in a public way because it just doesn’t scale very well. But there are many tricks we have learned through the development of EVE Online which map very well onto the concept of sharding as people have been using it in a blockchain. So we think we can get a little bit easily around the scalability problem by kind of leaning into sharding as a method to do that. 

Then you have the ability for players themselves to compose elements of the world through writing smart contracts, uploading them, and creating infrastructure for the rest to do as EVE players have already done. You can go to EVE on GitHub. You will see amazing amount of infrastructure created by thousands of people over the past 20 years and that’s amazing. So this is another amazing way to do similar things. so that’s number one.

I included some links to topics I wasn't too sure about. Hilmar tends to talk in buzzwords, which is fine for investors looking to be impressed. But I want knowledge, even if the presentation is meant to attract more funding and investment into a cryptocurrency.

After listening to the presentation a few times now, the question arises. Is the possibility of compensating third-party developers for their efforts a good thing? Over the years, CCP has struggled with ways to let these player-developers monetize their work. At first glance, the idea has promise.

But then I can see a downside. Will players then have to pay real money (or cryptocurreny) to join a player-run organization like a corporation or alliance? These organizations are the social glue that keeps players involved in the game, oftentimes long after the player loses interest in the game itself. Harm player social interaction, harm the game.

We are still in early stages with Project Awakening. Since a lot of people just want to naysay and demonize the concept, I think I have a lot less competition on the subject than I normally would. Admittedly, I have problems figuring out how web3 and blockchain technology is a net positive for MMORPGs. Then again, until Genshin Impact came along, who thought gacha games would become popular in the West?

Would You Play EVE 3.0?

On Friday, venture capital firm a16z published a video featuring an interview with CCP Games CEO Hilmar Veigar Pétursson. The interview was another example of the tough financial situation Pearl Abyss finds itself in. After losing ₩41.1 billion ($35.6 million) in 2022, the South Korean game company finds itself still trying to develop Crimson Desert and PokeV. In order to fulfill one of Pearl Abyss' major goals, developing a Web 3 game, CCP Games had to look for outside financing.

Mention of subjects like web 3, crpytocurrencies, blockchains, and play to earn send many, if not most, serious gamers fleeing. Honestly, I can't blame them. The closest I've come to playing anything remotely like a game having those components is EVE Online. Which leads to the question, if Project Awakening is a modernized version of EVE Online, would you play the game?

What do I mean by modernized? For example, correcting CCP's original sin of building a single-threaded application. Back in the beginning, CCP Games gambled that the future was bigger and bigger processing chips rather than multi-threaded processing. In other words, imagine an EVE Online capable of hosting fights of 5,000 players comfortably.

Or what about the mission system? Did anyone else get tired of rescuing the Damsel at least once a week? I know I did. But the old system in EVE involved handcrafting each mission, meaning updating those missions is prohibitively expensive. What if the mission system is dynamic and easy to update? Does anyone find that prospect attractive?

What about the user interface? Instead of being tied to the old spreadsheets-in-space UI, what if the developers were allowed to build a completely new UI without having to worry about legacy code? Would a better UI draw players in to play the game?

Talking about legacy code, is anyone interested in playing a game in which certain bugs never are fixed because they are attached to long abandoned features that still affect systems? EVE Online veterans know I'm referring to the POS code. For anyone who doesn't know what POS code is, all I have to say is, ignorance is best.

Or the map. No, I'm not referring to the horrible in-game maps that require the use of external maps like Dotlan. Instead, I'm referring to the security areas within the New Eden cluster. Imagine an EVE where, instead of high security space dominating the middle of the map, a disaster occurred that destroyed civilization in the middle of the map and the NPC empires controlled the outer ring of regions. Each of the four empires (Amarr, Caldari, Galente, Minmatar) would control space at the cardinal points of the map, with security steadily dropping until the core of the cluster is reached. Would that entice players to the game?

For a more general public, or for the really old veterans of the game, what if avatar play is added to the EVE universe? What if, instead of trying to developer their own engine (Carbon), CCP decided to use Unreal Engine 5 instead? We know during the VR years that EVE characters and graphics were ported into UE4 for EVE: Valkyrie. So the technology exists. Would players want to play a game in which the developers finally deliver on the promise of walking in stations?

Once again CCP cannot do this on its own. Pearl Abyss cannot help financially, although they will back CCP making a game if it incorporates web3 technology. The only way a game like the one I described above gets made is if the crypto-bros and their money become involved. So the question becomes, would the visceral revulsion at web3/blockchain/NFT/play to earn games override the desire to play an updated version of EVE Online? Would you play an EVE 3.0?

Upcoming Changes To Island Sanctuaries In Patch 6.4

One of the more intriguing features introduced in Final Fantasy XIV's Endwalker is island sanctuaries. A reward for finishing the first story arc of Final Fantasy XIV, level 90 players get not just a plot, but a whole island to call their own. But the feature is very much a work in progress. In last Friday's Producer's Live Letter, Yoshi-P gave a preview of what awaits players in Patch 6.4: The Dark Throne.

First, the next patch will increase the rank cap for island sanctuaries. My guess is the cap will increase from rank 12 to rank 15. Any higher increase would require a ridiculous amount of time to complete, so I don't expect a 5 rank increase until patch 6.5.

Yoshi-P presenting the changes

Next comes new gathering areas. Since the devs added new vegetation-type nodes in 6.3, I expect we next travel under the ground to find new mining nodes. The mountain in the middle of the island is a good candidate for such a zone. Also, the new animal on the island indicates an underground setting.

Spriggans!

The addition of new construction plots in the hideaway is interesting. Will our built up area near the beach become larger, or will we create a second area near the new zone? My hope is for more workshops, but I'd like to add the new vision preview to my island.

A new observation platform?

Of course, the biggest news is the addition of outdoor furnishings to island sanctuaries. At the very least, high level players unable to get a plot of land have a use for all those outdoor furnishings that now are cluttering up their inventories

Details for furnishings

That's right, island sanctuaries can have more than double the amount of outdoor furnishings than mansions. Then again, the outdoors section of a mansion shares an instance with 29 other plots of land. Personally, I have a cottage and there is so much I want to do but 20 slots is just not enough. I'll be glad to play around on my island with some of the really interesting items available.

Of course, those who are still grumpy players need to finish the Endwalker MSQ to obtain an island will note no training dummies or garden plots allowed. In the apocalyptic world of FFXIV, one can't have everything. Those trying to get a plot of land for a house can tell you that.

And finally we get a various selection of new materials to gather, items to both handcraft and churn out in our workshops, and crops and animals to tend. Overall, something to look forward to. Not a main feature, but then again island sanctuaries are something intended to fill up some time when players want a break from the exciting content. I'm looking forward to the next producer's live letter so I can stop speculating and start planning.

Crypto, FOMO, And The Crypto Blackhole

I don’t think there will be much progress on this front until developers are asking “How can cryptocurrency make my game more fun, if at all?” rather than “How can I add cryptocurrency into my game?”

- Tyler Cloutier, co-founder Clockwork Labs

Sometimes I travel down a rabbit hole and find some potentially surprising things. One of those rabbit holes involved Clockwork Labs. I wrote briefly about the company last week, as CCP Games was involved in a $22 million round of investment in Clockwork Labs in June 2022. Besides discovering CCP Games CEO Hilmar Veigar Pétursson was involved in an initial $4.3 million round of investment in August 2021, I found the BitCraft website hosts a blog. What I found kind of surprised me.

A month after the June 2022 round of funding, co-founder of Clockwork Labs, Tyler Cloutier, wrote a blog post titled "Thoughts on Cryptocurrencies and Games".  He had this to say about adding crypto-currencies to the company's game in development, BitCraft.

I actually don’t personally have a problem with using any technology that would help us achieve it. Fun is not about technology, it’s about game design and how players feel. My issue with cryptocurrency, I suppose, is not with cryptocurrency itself (energy usage notwithstanding), it’s that it’s used almost exclusively for high stakes FOMO. Using FOMO to drive players to our game or to bid up the prices on our hypothetical NFTs makes everything about money, rather than building a good game. It *doesn’t* increase the longevity of our game. It *doesn’t* make our community any healthier. And it *doesn’t* make the game more fun. In fact, so far in the places it’s been tried it has basically done the opposite in the long-term. For those reasons, we’re currently of the opinion that adding cryptocurrency to BitCraft isn’t going to help us towards our goal.

FOMO, or fear of missing out, is a practice found in a lot of MMORPGs. Cloutier goes on to quote Warren Buffet:

“People start being interested in something because it’s going up [in value], not because they understand it or anything else. But the guy next door, who they know is dumber than they are, is getting rich and they aren’t, and their spouse is saying can’t you figure it out too? It is so contagious. So that’s a permanent part of the system.”

But according to Cloutier, players are not the only ones enticed by FOMO. Game companies also do not want to miss out on the potential piles of cash web3 and cryptocurrencies can ultimately pile up.

In August of 2021, the crypto collectibles game Axie Infinity made $364,000,000 in revenue. I have relatively deep connections in the game industry and let me tell you that got the attention of every game developer I know, both huge conglomerates and small startups. The interest was 0% motivated by wanting to make a better game and 100% motivated by FOMO. By now the wave of fear has largely subsided and a lot of companies have stopped or slowed pursuing it, but rest assured it will be back.

When the potential revenue reaches 9 digits, a lot of game companies will ignore the wishes of players and play to the investors. So despite the negative consequences we've seen, game executives still want to grab for the brass ring.

Cloutier also indentified a pattern in the development of games using cryptocurrencies he calls "The Crypto Blackhole"

1. Developer states that they’re going to sell crypto assets to fund development of a game
   
   
2. Developer releases exclusive crypto in-game assets (land, cloths, creatures, energy, whatever)
   
   
3. Crypto speculators buy up all of the in-game assets hoping to make money on them
   
   
4. Crypto speculators aren’t interested in playing the game, because they prefer speculating
   
   
5. Gamers are not interested in playing the game, and can’t afford to buy the in-game resources even if they were
   
   
6. The game has no players
   
   
7. Crypto speculators encourage the game developers to make more speculative assets, rather than make the game better

The effects of the process result in what most gamers would consider unsuccessful games. While enticing due to the amounts of money made on the way down, the game's community becomes deadlocked and the game developers cannot get out of the hole they've dug for themselves.

I knew I had to write a short post on this topic after I saw the date on the blog post. The co-founder of a company writing something like this a month after some people involved in a $22 million round of venture capital funding thought they were buying into a crypto-game might have been shocking to say the least. But perhaps more importantly, I have reasons to dislike these types of game that go beyond "everyone knows those types of games are bad."

EVE Online Slipped A Little In March 2023

Looking back at March, activity declined just a little compared to February when viewed on an average daily basis. Compared to March 2022, however, the statistics show the game is in a much healthier state.

Activity from April 2022 to March 2023

From Jester's average concurrent user chart, we see the ACU during March fluxuated between 19,000 and 20,000 each day. A slight decline from February, but a lot better than the precipitous decline that occurred in March 2022 due to the impact of Russia's full-scale invasion of Ukraine at the end of February 2022. Hopefully Tranquility will see higher year-over-year active user counts when the next expansion launches sometime in the second quarter of 2023.

A major part of Uprising was an effort to improve factional warfare. The Shadow War event led to increased PvP activity in low security space in March. Compared to February, players lost 21.8% more ships each day in low sec. The eye popping number is the year-over-year figure. Average daily player ship losses jumped from 5314 in March 2022 to 9156 in March 2023, an increase of 72.3%. The implementation of Direct Enlistment did not cannibalize null sec PvP kill numbers, as those only fell by 55 per day compared to February. Compared to March 2022, 10.7% more ships died each day in March 2023 than one year before.

The big downside in the March data involved players killing NPCs. The numbers were down on an average daily basis across high (-11.8%), low (-5.6%) , and null security space (-5.1%) on a month-over-month basis. But the numbers were much better than in March 2022, with NPC kills increasing by 8.1% in high sec, 17.4% in low sec, and a staggering 33.5% in null sec.

I realize that the numbers for last year were suppressed by real world wars inhibiting the ability of a significant portion of the player base losing the ability to access the internet and the international banking system. But the numbers are still up over pre-Uprising levels. Hopefully CCP is able to build on the success of Uprising and increase activity even more with the next EVE Online expansion.

Cloud Imperium Games Earns $9 Million In March 2023

In March, Cloud Imperium Games recorded $9 million in sales of Star Citizen and Squadron 42 related merchandise as recorded on the funding page. The total represented a year-over-year increase of 53.8%, or $3.1 million. Looking at the first quarter as a whole, CIG sold $20.9 million, a 4.4% increase over 2022's first quarter revenue of $20 million. Overall, CIG ended the month having sold $560.9 million in goods since the company incorporated in April 2012.

Some people might not believe the figures and consider this post an April Fool's joke and I will report the actual numbers in a couple of days. For those people, I have to say, put down the copium, the release of Alpha 3.18 was greeted warmly, at least in a financial sense.

I can think of three reasons for the increase in sales in March. First, Alpha 3.18 was a long awaited (almost 10 months) patch. Do people really abandon a game if they can't log in at launch? As someone who lived through FFXIV's Endwalker launch, I can safely say no. Next, Alpha 3.18 involved a complete server wipe. A lot of people who hadn't purchased ships in the past probably hit the cash shop to replenish their ship hangars. CIG held a couple of ship sales to encourage the practice. Finally, year-over-year sales fell 43% in February, which means a lot of players saved their money for the launch of Alpha 3.18. At least, one can assume they did based on the March sales figures.

But just because CIG is 4.4% ahead of 2022's record sales does not mean the company is meeting financial goals. At the beginning of February I tried to estimate how much CIG needed to record in sales to meet the company's goals. The figure I came up with was an increase of between 13.2% and 18.5%, mostly based on CIG's assumed goal of fielding one thousand employees by the end of 2023.

I don't have sources in CIG's headquarters, but the sales goals had to have suffered due to the multi-month delay in deploying Alpha 3.18. Perhaps CIG learned last month releasing updates brings in more money. On Wednesday, CIG announced a more aggressive testing schedule to do just that. We shall have to see if the move works, but if I am correct, expect to see CIG's sales and marketing efforts to become more aggressive throughout the remainder of 2023.