NFTs

Why AAA Game Developers Will Target NFT Boom

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Credit: Photo by ELLA DON on Unsplash

By Chris Stead

Will the developers for AAA video games ever get involved in the play-to-earn NFT space?

It may come as a surprise to learn that the community most opposed to the boom in NFT games are gamers. Traditional gamers, at least – the ones who invest hundreds of hours of their time and thousands of dollars in game content and downloadable cosmetics on the likes of Nintendo Switch, Xbox Series X and PlayStation 5. 

To them, NFTs are seen as a plague. It’s a scourge full of scams that can only drive up the cost of their favorite hobby and kill the environment along the way. If you want proof, simply head to a forum on any major gaming publication or subreddit, ask what the locals think of NFTs and get out the popcorn. You’re in for a ride. 

As a result, the big game publishers and developers who create products for this audience have been very backward in coming forward with their NFT plans. Some vocally oppose the phenomenon. Most are vague. Others stay silent.

For investors, this could be seen as detrimental to the future of NFTs. Or at least on the maximum return they can get from NFTs and NFT game-related altcoins. Potentially, up to 2.8 billion humans are considered gamers. Will this audience forever be opposed to NFTs?

But fear not, they are coming.

Making moves

It starts with blockchain, the technology that enables NFTs to be minted, stored and traded immutably and efficiently. It also allows the many altcoins that drive the NFT game ecosystems to flourish. While they’re not making a song and dance to it with gamers, pull back the curtain and many of the biggest AAA game publishers in the world are already knee-deep in blockchain.  

Microsoft has been leveraging blockchain technology for years now. It’s the backbone of the Xbox Live Marketplace and Game Pass economies. Epic Games, the makers of Fortnite and Unreal Engine, acquired MagnaChain outright. The mighty Ubisoft of Just Dance, Assassin’s Creed and Rayman fame is the key backer of the Tezos blockchain.

Atari has 2 altcoins: Atari Token and Pong Token. It has also released a number of NFTs based on its iconic brands, as has Sega and Konami. Take-Two (Grand Theft Auto, Borderlands, NBA 2K), EA (FIFA, Battlefield, Mass Effect) and Square Enix (Final Fantasy, Tomb Raider, Kingdom Hearts) have all voiced their desires to get involved too.

Sony, makers of PlayStation, have been actively exploring all applications of blockchain technology. As well as various patents for upcoming use cases, it has been exploring the technology for digital rights management (DRM).

We could go on. The point is, while game developers may not be saying it publicly, behind closed doors blockchain is the next big thing.

First comes blockchain, then NFTs

The key here is to remember that once blockchain is used to drive these ecosystems, the definition of what is and what isn’t an NFT is pure bureaucracy. Once a gamer buys a product from the Xbox marketplace and it's stored on the blockchain, for example, all the components are there. Your account profile is your wallet, the digital game code is your NFT. It’s just in a centralized, closed ecosystem, so we don’t call it an NFT.

As angry as their customers are getting about the NFT phenomenon, it seems inevitable that AAA game publishers and developers will begin to use blockchain. Why wouldn’t they? Its efficiency and automation will save them millions over existing processes. And from there, flicking the switch to NFT will become a use case that can’t be ignored. It turns players into stakeholders.

Ubisoft leading the way

Of all the AAA publishers, Ubisoft has been the most overt in revealing its NFT plans. As well as backing a number of projects and platforms in the space, the company has launched its own NFT platform, Quartz, and its own NFTs called Digits. These tie-in to their blockbuster Ghost Recon series. 

The effort was met with predictable anger from traditional gamers, but you can bet that all Ubisoft’s peers took studious notes. The intent of the industry is clear. It’s just about finding the right middle ground now with existing customers, AKA traditional gamers.

But as part of a wide-ranging interview with Finder, Ubisoft also revealed a deeper opportunity that NFT games and the play-to-earn (P2E) concept offer AAA developers.

Nicolas Pouard, the VP of Ubisoft’s Strategic Innovations Lab, who is leading the company’s foray into blockchain and NFTs, responded honestly. And he pointed to guilds being “the future of user acquisition.”

For those not in the know, guilds – the best known of which are Balthazar and Yield Guild Games – are platforms that create communities of P2E gamers deployed into NFT games. For investors who own NFTs but don’t want to play all day to reap the rewards, P2E gamers do the hard yards instead. The 2 parties then do a revenue share, benefiting both.

P2E gaming has become a huge industry, especially in developing countries where the daily payout effectively matches a living wage. This represents an entirely new audience of gamers that traditional AAA publishers and developers don’t currently reach. An audience in the tens of millions, if not hundreds of millions. The fact that Ubisoft has flagged their intention of being active in the P2E games space for the purpose of user acquisition shows that it’s financially a better move than advertising for new customers through traditional means.

This shows yet another underlying reason why the AAA game scene will eventually move into the NFT and P2E gaming space. And when combined with the financial savings of running a game and bringing users into the ecosystem as a stakeholder, it bodes well for the future of NFTs as an investment for everyone.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Finder

Finder is a global financial technology platform which allows members to save, invest and spend via the Finder mobile app and website. Finder’s mission is to help people make better financial decisions and work with partners to connect via API into the Finder platform to offer saving and investment services and products. Finder was founded in Australia in 2006 and now operates in 50+ countries with 2,600+ product partners and 10+ million visits every month, serviced by 500+ crew passionate about helping our members achieve their full financial potential.

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