Video games developers have become masters of deception, and it’s incredibly profitable. By offering their games for “free,” they get players hooked and then, once they’ve built up a captive audience, they start “selling” them all kinds of weapons, skins and other digital items. They design their games so that these items give players a massive advantage, making it all but essential for players to acquire them so they can progress further.
It’s an established model and it works extremely well – for the developers. But the players are being screwed over, for they’re not actually “buying” anything at all. They hand over their money, but they own nothing. They simply pay for the chance to borrow an in-game item they can never sell, which might disappear into the aether at any moment.
Unfortunately, that has happened to thousands of gamers. This year, Bethesda Softworks announced that it’s sunsetting its popular title The Elder Scrolls: Blades later this year. When it goes dark in June, millions of dollars’ worth of in-game items bought by its loyal players will simply vanish into thin air, and none of them will be compensated.
The plague of the revocable license
Bethesda Softworks isn’t breaking any laws by doing this. Its End User License Agreements treat any in-game purchases as “revocable licenses,” which means it can revoke access to those items any any moment it chooses. So in other words, players aren’t buying new swords or characters, they’re simply paying to temporarily be able to use them.
Modern video games are effectively walled gardens, where developers reign supreme as the only arbiter of value. All of the in-game items owned by everyone in the game are recorded on a private database operated by the developer. They can never live outside of that server, and no-one else can own them. If the studio becomes insolvent, or it just decides the game is no longer profitable enough, it can and will flip the power switch off, and whatever inventory players thought they may have owned is suddenly no more.
When games are asking their players to hit that “buy” button, they’re lying.
Web3 has a fix
Loyal gamers sometimes spend hundreds or even thousands of dollars on their favorite titles. They deserve better treatment, which is why public blockchains are the future of video games. By registering in-game items on a decentralized ledger instead of a privately-owned server, we can create “real-world assets” that nobody can vaporize by pulling the plug. When in-game characters are transformed into RWAs, players actually have the chance to own them, and they can sell them when they’re no longer needed. That’s because proof of ownership lives on the blockchain, rather than in the game itself.
This isn’t some theoretical idea, companies like Gala Games, DApper Labs, and AMGI Studios have proven how successful it can be. To look a bit deeper at how this plays out, players can see how AMGI’s popular title My Pet Hooligan, a multiplayer online shoot ‘em up, uses NFTs to represent in-game characters, skins and weapons. These assets live on the Ethereum blockchain, and players regularly trade them with one another on a thriving decentralized marketplace such as OpenSea, without needing to ask for AMGI’s permission to do so.
How players can get a “digital deed”
My Pet Hooligan’s NFTs can act as both a claim to ownership and a potential investment. Early adopters can potentially reap the rewards of this system, powering up their items, skins, and other digital in-game assets, then selling them as the game becomes more popular. AMGI itself doesn’t lose out but it still gets to sell the digital goods, and developers even have the option to use smart contracts to enforce royalties for any resales, if they desire an additional cut.
In other industries, consumers are protected against companies going out of business. For instance, if someone buys a board game and the creator later goes bankrupt, nobody is going to come to their house and take that product away from them. So why should digital purchases be any different?
If people are being told they have to hit the “buy” button, then completing that action should mean they own the item in question. Ownership should be sovereign and verifiable. The items should belong to the players, not the developers. Blockchain provides the infrastructure to enable this, and the likes of AMGI and others have proven it can scale. So there’s no excuse for developers not to embrace this technology. They have a moral duty, in fact.
Gamers aren’t ignorant to this deception, but until recently they didn’t have much choice. To compete, it was always necessary to pay for temporary access to “bits” that they’ll never actually own. But with the rise of NFT-based games, we finally have an alternative. It’s time for games developers to embrace this model and give their players the “digital rights” they deserve.
Featured image via Shutterstock.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
