a16z Crypto Analyst: Why web3 games will eventually disrupt the game industry

Elena, an analyst of the a16z crypto investment team, tweeted that web3 games will unleash the true potential of user-created content, and web3 games will disrupt the game industry.

1. The Web3 game vividly proves that the digital economy will be the most powerful, composable and remixable. Due to the network of users and participating contributors, value can be compounded in real time instead of extracting value at each layer of the stack.

2. In the traditional and cloud-based gaming world, the rake rate, centralized companies, and the inherent static nature of game assets limit the size of the universe.

3. In the past ten years, the game industry has been exploring player-centric value transfer forms, trying to have secondary markets and user-generated modifications. But the progress is not significant.

4. In 2011, Activision’s “Modern Warfare 3” was the fastest-selling cultural product in history, reaching $1 billion in sales and about 6.5 million copies in 16 days (beating the previous sales record holder movie Avatar for one day).

5. Modern Warfare in 2011 is what we now think of as a closed ecosystem: it profited from unit sales rather than user-generated in-game items. Interestingly, there is still a “secondary market” in the game: pirated copies and high-yield theft.

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6. In 2011, it also witnessed the official release of the cross-platform sandbox world Minecraft. Soon, Minecraft had a series of user-managed module warehouses and servers; after being acquired by Microsoft in 2014, an official modification market appeared, with a commission rate of 50%.

zPFB8j9X7PLyhRqumiuirMeEhr3zf6hzsHhTzClp.jpeg7. I was surprised when Microsoft recently announced revenue and pointed out that creators generated $350 million from the module; after 50% rake, it was only $175 million in creator spending… For a monthly For games with 140 million active users, this is a shocking number.

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8. Let us look at another example: Roblox . Game players can purchase Robux, the in-game currency, to purchase in-game items and worlds created by other users in the ecosystem. Since the beginning of 2019, developers have earned $689 million.

gMvEVmad8azXJosmTxyCWX1T3wzNzgFqQKKcM2GT.jpeg9. US$689 million is an incredible number, but it would be even more surprising if Roblox was not forced to pay 30% of its revenue to other platforms. This is a problem caused by the app store upstream.

10. The Roblox CEO publicly stated that if Apple and Google reduce their average commission rate, their commission rate averages about 30%, he can pay developers more. In other words, they have been drawing commissions.

11. Tim Sweeney of Epic Games also talked about platform rent-seeking. The worry is that centralized platforms will one day “collect taxes and guard the world’s commerce.”

12. Last weekend, the “Wall Street Journal” found that Apple had earned $8.5 billion in operating profits in 2019 by taxing game revenue-an early sign that major platforms were stifling value. This is obviously not good for developers.

13. The game now mainly monetizes through two modes: in-game purchases (studios such as Fortnite, Activision, Rockstar, and TakeTwo have gone this way) and user-generated modules with commissions (Minecraft, Roblox).

14. Web 3 games will subvert all of this.

15. The focus of Web 3 is that users own in-game items (as NFT), in-game currency (as ERC-20 tokens), and ultimately own the game itself (a governance token that obtains in-game revenue through authorized users).

16. For me, the definition of ownership is simple. If I need someone else’s permission to use or move an item, I don’t own it. If I can buy, sell and interact with something freely, I will do it.

17. Yes, according to my definition, this means that you don’t actually own the money in traditional games, game items, stocks, bank accounts, or even your home if it involves a middleman. Ownership is defined as the complete absence of intermediaries

18. New Web 3 games, such as Axie Infinity , Loot and Rarity, are beginning to embrace this.

19. Look at Axie Infinity, this game has about 1.7 million players and more than $2.3 billion in transaction volume. In the game, users directly own Axie ‘s NFT, and can earn SLP (Axie Propagation Token) and AXS (Axie Governance Token) through games and transactions.

19. Axie will also allow users to own plots and eventually launch new games on the platform itself. In addition, Axie is launching its own decentralized exchange.

20. Loot is another good example. dhof is managing loot’s derived and synthesized NFT projects and expanded areas of games, all of which are built around a simple text-based NFT.

21. The trading volume of Loot exceeded 67,000 ETH (USD 232 million), the trading volume of LOOT derivatives exceeded 2,700 ETH (USD 10 million), and the market value of AGLD reached USD 217 million.

gbBEmlgQ3S7pCYIu4FHggiO2Dh7i1E0aEVmSe3uY.png22. All these values ​​are given back to the community through transaction royalties and minting costs for developers.

23. As impressive as the numbers, the real cool thing about Loot is that we are witnessing a game built in real time. Where and how the value in the Loot ecosystem is generated remains to be determined: stories are written by users.

24. On the Fantom blockchain, a network of developers is building Rarity, which is a D&D-style on-chain game in which players can generate “summoners”, and they gain levels and skills through daily gameplay.

25. As each level progresses, the summoner will earn points, which can unlock additional game elements, including attributes, skills, crafting, specialties, rare gold coins, and the ability to perform different tasks. The game has multiple user-created front ends and contracts, which affect the gameplay.

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26. Web 2 and Web 3 games are exploring the difference between maps built by centralized game studios and real-time maps built by billions of other players. And all this is because, for the first time in history, players can own their own assets.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/a16z-crypto-analyst-why-web3-games-will-eventually-disrupt-the-game-industry/
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