Key Takeaways
From physical consoles to app stores, the platforms that underpin the modern gaming industry have a massive influence over game developers and the kind of monetization models available to them.
However, legal and regulatory developments have created new opportunities for game makers to forge their paths.
Chris Hewish, video game chief strategy officer (CSO) at video game commerce company Xsolla, spoke to CCN on the matter.
As Hewish explained, although Big Tech gatekeepers somewhat restrain many game companies, the underlying platform they make games for affords them varying degrees of freedom.
“PC has been relatively open for a while,” he observed, although he acknowledged that large platforms like Steam dominate the space.
Mobile gaming, on the other hand, has traditionally been characterized by “walled gardens” that control distribution and determine what kind of services companies can offer gamers.
Hewish observed that console gaming “is still its own closed ecosystem,” where consumers are used to buying a piece of hardware and then buying games from the platform linked to that specific console.
For game developers, objections to platform restrictions ultimately boil down to payments.
In the U.S., the issue came to the fore in a multi-year legal battle between Google and Epic Games. To avoid the 30% transaction fee Play Store charges on in-game payments, Epic took Google to court, accusing it of operating an illegal monopoly.
Although it lost a similar legal battle with Apple, after four years of legal wrangling, Epic eventually won a decisive judgment in the case that could reshape the relationship between Google and game developers for good.
After a jury sided with Epic, the judge in the case ordered Google to let app developers integrate payment methods other than its own proprietary billing system. He also ruled that the company can’t prohibit rival app stores from listing on Google Play.
While Google intends to appeal the decision and has pushed to halt the implementation of the judge’s order on security grounds, Hewish pointed out that the emphasis on payment flexibility is part of a wider global movement.
Pointing to the EU’s Digital Markets Act and South Korea’s Telecommunication Business Act, he observed that outside of the U.S., lawmakers have already forced Google—and Apple—to make many of the changes mandated by the Epic judgment.
Besides lower transaction fees on in-game payments, Hewish pointed out several other advantages of more open gaming ecosystems.
For one thing, whereas app stores once provided crucial exposure and discoverability, as they became more crowded, developers started to face the opposite problem. These days, however, they can increasingly turn to their own websites or third-party app stores to attract new users.
“It really allows mobile game companies to solve the discovery problem,” Hewish noted, “because now they are in complete control of marketing directly to their players”.
Hewish stressed that access to better user data is another crucial but often overlooked aspect of app store regulation and the Epic decision. He said:
“Now, you get a full picture of your data. You get to marry the gameplay data with the transactional data and the viewing habits and all the different things that players are doing that you don’t get access to through a through a gatekeeper or a platform.”
As Hewish explained, the first developers to fully realize the potential of all this data were social casino companies. But as more developers look to create personalized experiences, they are increasingly directing players “outside of the game,” offering them customized offers and content on separate web shops or even via real-world events.