Economics of Video Games: KickstarterAs many of you have probably heard now, Richard Garriott's Kickstarter campaign successfully raised $1 million in 10 days for his RPG Shroud of the Avatar. This is an incredible achievement for a game industry legend such as Garriot, but it got me thinking, how will Kickstarter affect the video game industry, if at all?
At first glace, I believe Kickstarter funded games will bring a breath of fresh air into an industry that's happy to rest on the laurels of an established franchise. Look no further than Far Cry 3, Gears of War: Judgement, God of War Ascension, Starcraft II, Halo 4, Tomb Raider (reboot), Dead Space 3, Fire Emblem, Elder Scrolls V: Skyrim, GTA IV, Assassin's Creed III and so on. While developers advance the gameplay with these series, it's still the exception to the rule to see new IP in today's market (not forgetting you Watch Dogs, Beyond: Two Souls, L.A. Noire etc...) Understandably, companies expect to make profits on their products and sticking with a tried and true franchise is the best way to reduce the risk of a flop.This model, unfortunately, stifles new IP and a diverse market for gamers. Kickstarter, hopefully, will show developers that consumers are willing to put their money where their mouth when it comes to new and fresh IP, in lieu of simply griping about it on the internet (which of course never happens).
Having consumers front their own money for the partial development of a game simplifies a very tedious aspect of economic analysis, which is the construction of Indifference Curves. Before, economists and analysts would have to rely on theory and proxies to determine these curves to gain insights into consumer behaviors. With Kickstarter, we can be much more efficient and accurate in assessing consumers' preferences and get a better pulse on the market. Furthermore, it reduces the financial risk of the developer because they literally have financial investment in the project which greatly increases the probability the invested consumer will purchase the game.
Of course, there is a downside to the Kickstarter trend as well. If the Kickstarter precedent is set, developers could start expecting consumers to pony up for games across the board, including established franchises. If this becomes a requirement, consumers will have less disposable income for games, reducing the number of actual games they can purchase. It would be an interesting study to see how that would affect the gaming economy as a whole (economic benefit of developers saving costs vs the economic hit to physical retailers who sell/ship the games). Maybe I'll do that in another journal in the future.
Another possible downside gets into the classical microeconomic trade off between equity and efficiency. Kickstarter allows for a very efficient means of determining consumer preferences by directly asking for monetary investment from them. This comes at the expense of equity (fairness) however. Consumers with more disposable income would have much more pull in what type of games come out and likely the market will converge more toward their preferences than the consumers en masse. Some of you might say that's fine because they're the ones ponying up while others might say that isn't fair for those who can't invest in game development. That's more of a moral issue than an economic so I won't delve too much into that.
Suffice to say, Kickstarter creates a lot of potential to see very innovative, creative, and original content that will add a breath of fresh air for consumers. As with all things, there are costs as well and we don't know how deep those costs will be.
Corporate Christmas TraditionMy company, Healthways, has a very nice and unique holiday tradition: everyone in the corporate HQ goes to a local Walmart where we receive a list of needs and wants of an underprivileged youth. From there we shop for the stuff on their wish list and our company picks up the tab. It's an amazing experience and a great tradition I'm proud to be apart of. Also, someone in Marketing snapped a picture of me rocking the Rooster Teeth Xmas t-shirt. Party on!
The Penn State Probe Out TodayWhile I always held my suspicions, I wanted to wait for the independent probe before I cast judgement. Reading the report, it deeply saddens me about the deliberate cover up of the abuse inflicted on the victims by all levels of authority at Penn State from administration officials to Joe Paterno himself. No sport, or legacy, is worth the destruction of the welfare these victims even a program I have long supported. My heart, again, goes out to the victims but also the Penn State community who has been dragged through the muck for the actions of a few men.
Virtual EconomistIf you haven't read this article yet: Valve's Economist, it describes how Valve hired an economist to study virtual currency in their games. Considering I've already written a paper on it back in the day on Star Wars Galaxies's (vanilla) rampant inflation due to doctors buffs (back when I still played it; seems so long ago), I think I'd be a better pick (and probably cheaper too )
S&P Downgrade of US DebtS&P downgrades US debt to AA+ Friday evening. What's this mean for the economy? Here are some simple-ish outcomes of this action.
1). A lot of articles talk about increased borrowing rates. This is true but the time of it won't be immediate. There is an econometric tool called Impulse Response Functions which measures how long a shock in the money supply (or the economy in this case) will persist and what measure its magnitude. The large effects of increased borrowing rate probably won't surface until mid to late September.
2) So what happens with increased borrowing rates? It basically means that borrowing money whether through a loan or bond issuance will be more expensive. What's that mean in terms of the economy on the whole? Well, recent analysis shows that a 50-point increase in the interest rate on the 10 year T-bill (0.5 for the uninitiated) will slow growth of the economy by 0.4. Given the lackluster "growth" last quarter, this will push us close to 0 growth in the next quarter.
3) What will the government do about it? Fiscally? Probably nothing because politicians will too busy blaming the other side. The Federal Reserve will definitely go through with a QE3 which will flood the market with more money. This is lower the interest rate on T-bills to somewhat counteract the higher interest rate due to the AA+ rating.
4)Is that all? Nope, the stock market is going to get really ugly next week.
Have fun out there and don't forget to buy a ton of water and toilet paper (or if you're Joel, just use dollars instead of toilet paper :p ).
FU-tastic DayThank you all for the FU wishes! I can cross that off my bucket list now! Thanks again
Graduate Be called sir at restaurant / get older Start an in-person D&D campaign Finish an in-person D&D campaign Featured User at Rooster Teeth Meet the real John Nash Work for Rooster Teeth as an Economic Consultant 1000 point any game Defy Gravity (Momentarily) Take over the world without any knowing it.
Dragon Age 2: DemoI just finished the demo for the upcoming Dragon Age 2 game (PC) and I just wanted to give a quick review of it.
To preface this review, Dragon Age: Origins was one of my favorite RPG's of all time, and if you're looking for more of the same, you'll be disappointed. Don't misunderstand that; many elements have seen improvements but if you're looking for a carbon copy of Origins, you ain't getting it. Below I'll list how the game (or hasn't changed) with some thoughts.
The Origin of your hero: Different, but cannot determine for better or worse. You start the demo picking your gender and class (mage, rogue, warrior). Though you couldn't do it in the demo, you'll be able to customize the look of your character. Unlike Origins, you won't be able to pick your origin story or race. (which is why, I'm guessing, it's not called Origins 2). The demo was too short to see how this plays out.
Graphics: Different for the better The graphics look beautiful in this game (on a fairly decent PC). Character models where updated, have more expressive faces, and just generally look awesome. There seems to be more color in the game too; Origins tended to have this glazey hue about it. Combat animations look amazing. No longer will you have a few generic looking auto-attacks but a very entertaining and mostly flowing combat (mostly flowing; there were some minor hiccups with my rogue using melee).
Combat: Different, mostly for the worst Most of you will probably like the easier and more flowing combat, but I absolutely loved the tactical nature of Origins. Nothing made me happier than to survey a threat, strategically place my party, and unleash a flurry of orders to utterly destroy my foes. DA2 moved to a more action based combat than tactics (while there are some strategy elements, I definitely don't get the same feeling of absolute control). One major problem/glitch/oversight I noticed is that the "surrounded by x enemies" tactic option for party members casts a very, very wide radius. My mage would be spamming mind blast (knocks all enemies down within 5 yards of caster) when she was "surrounded" by enemies at least 20 yards away. There is one cool aspect of combat that is an improvement and that is when an enemy closes in on a ranged attacker. Instead of still using a ranged weapon to engage at point blank, the party member (and your character as well) will pass the ranged weapon to the left hand, pull a dagger for the right hand and engage in melee (with cool combat animation). As soon as the melee threat ends, the character will engage in ranged combat in a heartbeat.
Conversations:Instead of numerated dialog options, the Mass Effect conversation wheel was adopted. The only difference is that a small picture appears in the center of wheel to show the inflection of what will be said (e.g. Sarcastic, Honorable, Firm, Joking). I personally don't mind this.
Skills: You now have skill trees instead of the linear path for different skill disciplines. It's very much akin to Dungeon Siege II. I like this new change; it makes the leveling process and planning easier.
The demo wasn't nearly as long as I'd hope, but it was enough for me to feel comfortable enough to purchase the game when it comes out. With combat being my only large complaint about the game (aside from some delays in loading cutscenes but I think that's more a problem of the demo and not the actual game) I'm sure the average gamer will enjoy this game. Check out the demo yourself.
As in the Pittsburgh tradition, I'm going to give this demo (and apparent direction of the sequel from the Original) 4 pirogies out of 5 pirogies.
Just Finished Mass Effect 2 And ....So I just finished Mass Effect 2 tonight after picking it up at midnight on Monday/Tuesday and it was fantastic in just about every way. Vast improvements over ME1 in just about all aspects. I also tried getting all the achievements I could in one playthrough (47 outa 51, not too bad me thinks). Two of them I figured out how to get them too late in the game and one is play through again on Insanity difficulty. The last one really grinded my gears which is the hit level 30. Now, I did EVERY single quest and traveled to EVERY single planet and when I beat the game, I just hit level 27. Really?! Apparently I can export the character I beat the campaign with and start the game with all my weapons and at level 27, so I guess I have to do it on another playthrough (and get the insanity achievement while I'm at it). I'm sorry, I find it really lame that after, literally, 100%'ing the game, I didn't hit 30. Oh well lol. Still a great game and recommend everyone get it. And by everyone, I mean the 3 people who read my profile and journal posts lol.