Ikea, the Swedish home furnishings and decor giant, has been one of the leaders among retailers when it comes to adapting to tech innovations that impact its business, being one of the first to launch augmented reality applications, partnering with others to develop smart home devices and launching a business unit to build that out further, investing in relevant startups, and even picking up of logistics startups to expand its reach. Today, it’s taking another step in that trajectory with a tech acquisition: the company, by way of Ingka Group (founded by the founder of Ikea, and the primary franchisor of Ikea and owner of Ikea.com), has acquired Geomagical Labs, an AI imaging startup based out of Mountain View.
Geomagical Labs has not had a lot of fanfare, but quietly it’s been developing a number of computer vision-based technologies. Its first product — which allows a user to quickly scan a room using any smartphone, render that into a panoramic 3D picture in a few minutes, remove all the furniture in it, and then, in the words of Geomagical’s founder and CEO Brian Totty, “play dress up” by adding in new items to scale — will be implemented by Ikea into its website and apps to let people start to create more accurate visualisations of their spaces, and how they would look with Ikea pieces in them.
To be clear, Ikea already had developed an AR-based visualisation tool, as one of the first to use Apple’s AR developer kit a few years ago, but this represents a far more accurate and useful development on that, besides also giving Ikea the tools to build more features and tools in the future in house.
(That is the kind of technology that is always useful, but perhaps especially right now, when physical stores are being shut down in many countries around the world to stave off spread of the coronavirus.)
“We’re excited because the user can really play around with this and see how something would fit immediately,” said Barbara Martin Coppola, Chief Digital Officer, Ikea Retail, in an interview. She added that Ikea decided to acquire the startup rather than just partner with it for “a lot of different reasons, with the first being that the tech is exceptional and groundbreaking.” The app and online experience that Ikea is developing will be free to use, and for now, there are no plans to offer the tech as a service to other retailers, a la an AWS model, she added.
Terms of the deal — which technically is being made between Geomagical and the Ingka Group, which is also the company that acquired Task Rabbit and made other investments under the IKEA brand — are not being disclosed, the companies said. But Totty — a serial entrepreneur who was an early Groupon exec (by way of acquisition of a previous startup) as well as one of the founding employees of Inktomi (remember them?) — said that the startup and investors were “very happy” with the terms.
Those investors and how much it had previously raised is also not fully disclosed but they included Totty himself, Andrew Mason (Groupon’s cofounder and former CEO) and a number of other individuals.
From what we understand, the startup had been talking to a number of other interested parties, including other retailers and a couple of large tech companies. (For some more context, computer vision has been a very hot area for acquisition, both to pick up products and talent, and Apple and Google are among those that have been aggressively acquiring in this area in recent times to expand their own platforms.)
The reason why Geomagical Labs went with Ikea versus a tech exit, Totty said, was because the company was keen to make sure that its technology saw the light of day — rather than potentially get subsumed into a bigger tech machine that might or might not use it, or instead choose to redeploy the team (which includes six PhDs, including Totty himself) on something completely different, experience Totty would know given his track record.
“There has been so much progress in cell phones and AI, finally giving us this dream of waving your camera in front of you and to do cool things,” he said. He described going to Ikea as “a great bird in the hand” play.
“You plan all your options and you could decide to wait, but you don’t always have the ability to get partnerships of this kind. The question for us was, do we raise another round of funding, or do a 50 or larger percent acquisition? I don’t really want to talk about scenario planning but I believe what we’ve built is broadly valuable to all of the industry right now. And the challenge of a general purpose tech with a special product is that your domain of applicability is lower. We didn’t want to be talented people with a little technology but a game changer.”
Before Ikea, Coppola spent her entire career working for big tech companies, including many years at Google, as well as Samsung and others, and she sees this acquisition as an essential move in focusing the retailer even more squarely on its technology opportunity, by not just adopting new innovations but by owning the IP and building the technology itself.
“Ikea has spent more than $200 million investing in or acquiring 23 companies to date,” she said. “both to make a positive contribution to the sector and fulfil Ikea’s vision. This will continue to be the case. Acquisitions and investments will not stop and will increase,” she added.
Roto VR, startup which markets an interactive, ‘360 degree’ chair, has raised £1.5 million in a funding round led by Pembroke VCT. Others in the round include TVB Growth Fund, managed by The FSE Group.
The chair is designed to make VR more accessible to a mass audience, many of whom have turned to VR and gaming to while away the hours as much of the world is locked-down during the COVID-19 pandemic.
Founded in 2015 by video games industry veterans, Elliott Myers and Gavin Waxkirsh, Roto VR is an interactive chair that addresses the physical problems of consuming VR whilst seated, such as motion sickness and tangling cables, whilst also enhancing the immersive experience with haptic / vibration feedback in the chair.
The Roto chair is motorized and can auto-rotate to wherever the user is looking, allowing for 360-degree viewing, and thus allows the user to stay in the VR simulation for longer periods of time.
The inbuilt desktop also supports input devices such as a keyboard and mouse which means it can be used in 360-degree desktop computing.
“Most people sit down to watch movies, work, play games and browse the internet whilst seated and we see no reason why the exciting new medium of VR will be any different,” said Myers.
The product is compatible with most VR Head Mounted Displays and is also compatible with all movies and games, as well as additional accessories such as racing wheels and joysticks.
The company is due to launch the consumer and office version of Roto imminently. In addition, it will be marketed to cinemas and arcades.
Andrew Wolfson, CEO Pembroke Investment Managers LLP, said: “In Elliott we have found an entrepreneur who has solved a problem for the VR market with a solution that addresses the physical issues encountered whilst consuming VR content, as well as significantly enhancing the experience. We see future customers coming from both the B2B and B2C markets, in fields such as experiential attractions, home, cinemas and shopping centres.”
There’s a joke* being reshared on chat apps that takes the form of a multiple-choice question — asking who’s the leading force in workplace digital transformation? The red-lined punchline is not the CEO or CTO, but: C) COVID-19.
There’s likely more than a grain of truth underpinning the quip. The novel coronavirus is pushing a lot of metaphorical buttons right now. “Pause” buttons for people and industries, as large swathes of the world’s population face quarantine conditions that can resemble house arrest. The majority of offline social and economic activities are suddenly off limits.
Such major pauses in our modern lifestyle may even turn into a full reset, over time. The world as it was, where mobility of people has been all but taken for granted — regardless of the environmental costs of so much commuting and indulged wanderlust — may never return to “business as usual.”
If global leadership rises to the occasion, then the coronavirus crisis offers an opportunity to rethink how we structure our societies and economies — to make a shift toward lower carbon alternatives. After all, how many physical meetings do you really need when digital connectivity is accessible and reliable? As millions more office workers log onto the day job from home, that number suddenly seems vanishingly small.
COVID-19 is clearly strengthening the case for broadband to be a utility — as so much more activity is pushed online. Even social media seems to have a genuine community purpose during a moment of national crisis, when many people can only connect remotely, even with their nearest neighbours.
Hence the reports of people stuck at home flocking back to Facebook to sound off in the digital town square. Now that the actual high street is off limits, the vintage social network is experiencing a late second wind.
Facebook understands this sort of higher societal purpose already, of course. Which is why it’s been so proactive about building features that nudge users to “mark yourself safe” during extraordinary events like natural disasters, major accidents and terrorist attacks. (Or indeed, why it encouraged politicians to get into bed with its data platform in the first place — no matter the cost to democracy.)
In less fraught times, Facebook’s “purpose” can be loosely summed to “killing time.” But with ever more sinkholes being drilled by the attention economy, that’s a function under ferocious and sustained attack.
Over the years the tech giant has responded by engineering ways to rise back to the top of the social heap — including spying on and buying up competition, or directly cloning rival products. It’s been pulling off this trick, by hook or by crook, for over a decade. Albeit, this time Facebook can’t take any credit for the traffic uptick; a pandemic is nature’s dark pattern design.
What’s most interesting about this virally disrupted moment is how much of the digital technology that’s been built out online over the past two decades could very well have been designed for living through just such a dystopia.
Seen through this lens, VR should be having a major moment. A face computer that swaps out the stuff your eyes can actually see with a choose-your-own-digital-adventure of virtual worlds to explore, all from the comfort of your living room? What problem are you fixing, VR? Well, the conceptual limits of human lockdown in the face of a pandemic quarantine right now, actually…
Virtual reality has never been a compelling proposition versus the rich and textured opportunity of real life, except within very narrow and niche bounds. Yet all of a sudden, here we all are — with our horizons drastically narrowed and real-life news that’s ceaselessly harrowing. So it might yet end up a wry punchline to another multiple choice joke: “My next vacation will be: A) Staycation, B) The spare room, C) VR escapism.”
It’s videoconferencing that’s actually having the big moment, though. Turns out even a pandemic can’t make VR go viral. Instead, long-lapsed friendships are being rekindled over Zoom group chats or Google Hangouts. And Houseparty — a video chat app — has seen surging downloads as barflies seek out alternative night life with their usual watering-holes shuttered.
Bored celebs are TikToking. Impromptu concerts are being live-streamed from living rooms via Instagram and Facebook Live. All sorts of folks are managing social distancing, and the stress of being stuck at home alone (or with family), by distant socializing: signing up to remote book clubs and discos; joining virtual dance parties and exercise sessions from bedrooms; taking a few classes together; the quiet pub night with friends has morphed seamlessly into a bring-your-own-bottle group video chat.
This is not normal — but nor is it surprising. We’re living in the most extraordinary time. And it seems a very human response to mass disruption and physical separation (not to mention the trauma of an ongoing public health emergency that’s killing thousands of people a day) to reach for even a moving pixel of human comfort. Contactless human contact is better than none at all.
Yet the fact all these tools are already out there, ready and waiting for us to log on and start streaming, should send a dehumanizing chill down society’s backbone.
It underlines quite how much consumer technology is being designed to reprogram how we connect with each other, individually and in groups, in order that uninvited third parties can cut a profit.
Back in the pre-COVID-19 era, a key concern being attached to social media was its ability to hook users and encourage passive feed consumption — replacing genuine human contact with voyeuristic screening of friends’ lives. Studies have linked the tech to loneliness and depression. Now that we’re literally unable to go out and meet friends, the loss of human contact is real and stark. So being popular online in a pandemic really isn’t any kind of success metric.
Houseparty, for example, self-describes as a “face to face social network” — yet it’s quite the literal opposite; you’re foregoing face-to-face contact if you’re getting virtually together in app-wrapped form.
The implication of Facebook’s COVID-19 traffic bump is that the company’s business model thrives on societal disruption and mainstream misery. Which, frankly, we knew already. Data-driven adtech is another way of saying it’s been engineered to spray you with ad-flavored dissatisfaction by spying on what you get up to. The coronavirus just hammers the point home.
The fact we have so many high-tech tools on tap for forging digital connections might feel like amazing serendipity in this crisis — a freemium bonanza for coping with terrible global trauma. But such bounty points to a horrible flip side: It’s the attention economy that’s infectious and insidious. Before “normal life” plunged off a cliff, all this sticky tech was labelled “everyday use;” not “break out in a global emergency.”
It’s never been clearer how these attention-hogging apps and services are designed to disrupt and monetize us; to embed themselves in our friendships and relationships in a way that’s subtly dehumanizing; re-routing emotion and connections; nudging us to swap in-person socializing for virtualized fuzz designed to be data-mined and monetized by the same middlemen who’ve inserted themselves unasked into our private and social lives.
Captured and recompiled in this way, human connection is reduced to a series of dilute and/or meaningless transactions; the platforms deploying armies of engineers to knob-twiddle and pull strings to maximize ad opportunities, no matter the personal cost.
It’s also no accident we’re seeing more of the vast and intrusive underpinnings of surveillance capitalism emerge, as the COVID-19 emergency rolls back some of the obfuscation that’s used to shield these business models from mainstream view in more normal times. The trackers are rushing to seize and colonize an opportunistic purpose.
Tech and ad giants are falling over themselves to get involved with offering data or apps for COVID-19 tracking. They’re already in the mass surveillance business, so there’s likely never felt like a better moment than the present pandemic for the big data lobby to press the lie that individuals don’t care about privacy, as governments cry out for tools and resources to help save lives.
First the people-tracking platforms dressed up attacks on human agency as “relevant ads.” Now the data industrial complex is spinning police-state levels of mass surveillance as pandemic-busting corporate social responsibility. How quick the wheel turns.
But platforms should be careful what they wish for. Populations that find themselves under house arrest with their phones playing snitch might be just as quick to round on high-tech gaolers as they’ve been to sign up for a friendly video chat in these strange and unprecedented times.
Every day there's a fresh Zoom privacy/security horror story. Why now, all at once?
It's simple: the problems aren't new but suddenly everyone is forced to use Zoom. That means more people discovering problems and also more frustration because opting out isn't an option. https://t.co/O9h8SHerok
— Arvind Narayanan (@random_walker) March 31, 2020
*Source is a private Twitter account called @MBA_ish
The game developer behind Second Life has abandoned its grand efforts for a virtual reality follow-up to its early 2000s hit.
SF-based Linden Lab announced today that they’ve sold off assets related to Sansar to a small, little-known company called Wookey Search Technologies, which will take over development of the title. Linden Lab will continue developing and maintaining Second Life and it sounds like some of its employees will be joining Wookey. The deal was reported by Protocol.
The game studio had already announced layoffs last month.
Though Second Life has remained in the limelight of popular culture, the studio claimed to still be hauling in substantial revenues from the game in recent years. That said, the failure of Sansar is a disaster for Linden Labs which has focused considerable resources on the effort since it first teased the platform back in 2014.
When the title was announced, VR was at the peak of its hype following Facebook’s Oculus VR acquisition. Though Sansar launched in beta with support for both VR and desktop usage, the slow adoption of VR certainly didn’t help the title’s popularity. The studio’s leadership has detailed in interviews that the majority of Sansar’s users are desktop-based.
Given the evident turmoil at the studio, Sansar’s user base will likely be relieved to hear that the studio did their best to give the title a soft landing, though it’s unclear what resources its new acquirer has access to.
After years of hype, the AR/VR space has certainly grown quieter as of late, but some investors are still coalescing behind a vision that the technologies could one day replace mobile if the technical kinks can be worked out.
Creal is a Swiss startup that’s working on some fundamental display technologies that could make VR and AR headsets more comfortable with more life-like optics.
The startup raised a $7.4 million Series A last year from Investiere and DAA Capital Partners. The company announced this week that they received grant funding from the European Union’s Horizon 2020 research and innovation program to continue working on their light field display tech.
Light field displays are a category of displays that are quite a bit different that anything you’ve seen. While existing AR and VR headsets can show you stereoscopic 3D by displaying slightly different images to each of your eyes, future headsets will allow you to change what’s in and out of focus based on where your eyes are looking. The big optics issue this solves for is called the vergence-accommodation conflict and it allows for interacting with objects closer to your face and functionally makes reading in VR quite a bit more effective as well.
Here’s a “through-the-lens” demo of the startup’s technology from a video posted last year:
There are varying degrees of how the technology is implemented. Magic Leap rolled out a lightweight version of its technology in its headset that leverages a pair of focal planes that are switched between with eye-tracking. This “varifocal” approach is also something that Facebook is investing in, they’ve showcased prototype headsets that allow users to shift their focus between multiple planes.
Creal is having to deal with some of the same struggles as its big company counterparts have when it comes to making sacrifices in order to miniaturize the technology. Integrating their tech into a virtual reality headset is the nearest-term target for the company, though they have ambitions to integrate into lightweight AR headsets within the next several years.
Startups building tech like Creal may be particularly at risk to a global recession, when investment in frontier technologies typically takes a big hit. A prolonged period of economic instability will almost certainly tilt the scales in the favor of big tech companies like Facebook as startups approaching the same advances will likely be forced to push out roadmaps and cut costs in order to survive.
While Oculus has seen some recent success in expanding the VR market niche, augmented reality hardware has been an incredibly tough sell for startups. A number of companies in the space shut down last year, including Meta, ODG and Daqri. Earlier this month, Bloomberg reported that Magic Leap was positioning itself for a sale after raising billions of dollars in funding.
If you weren’t playing games when Half-Life came out, it’s hard to drive home just how shocking a departure it was from what had come before. Though some familiar mechanics served as a base to build off of, the injection of elaborately scripted sequences that put you into the action, mature humor and genuinely engaging set piece-driven plot put Half-Life into its own special section of the stratosphere.
It’s not often that you can say that a product changes everything in its category from that moment on. Half-Life did that.
And then when Half-Life 2 debuted, it did it again with its method of delivery, incredible building tools and yes, inventive-as-hell gameplay.
Half-Life: Alyx does that again for VR, making such a direct impact that this will be a demarcation line forever in the way we craft immersive virtual experiences.
Alyx begins in the period of time between Half-Life and Half-Life 2, taking place mostly just before the action in the latter. The world is familiar, as are most of the cast of characters (along with some bespoke new additions). Given their high-fidelity look and carefully stepped variety, even newbies to the Half-Life universe should be kept entertained as they encounter new threats.
Those of you returning will find a large part of the new experience in inhabiting the same virtually physical space as headcrabs, barnacles and combined forces. Let me tell you, seeing the underbelly mouth of a ‘crab flying toward your face in VR versus on your monitor definitely hits different.
That sense of presence that is so pivotal to VR is something Valve leaned into hard with Alyx. You are rewarded for treating environments and encounters as a place to pretend to be rather than progressing through. There are a variety of tricks that Alyx uses to make you comfortable existing in this world, not the least of which is the presence of a voice in your ear in the form of an engineer named Russell.
Played hilariously by Rhys Darby, Russell’s voice serves to mitigate issues that many VR aficionados may recognize. One of VR’s primary powers is that of embodiment — making the experience of being there so convincing that you generate real memories of presence. Along with that, though, comes isolation. Long VR sessions can make you feel cut off from reality, and horror experiences, especially, can become overwhelming. Having Russell there offering humanity and humor to punctuate the darkness of this supremely dystopian environment is a fantastic choice. You’re a solo operator, but you’re not alone.
The environmental intensity of Alyx is well paced, too. An intermix of heart pounding horror with moments of harsh beauty and humor can often be a difficult cocktail.
“There’s a lot of different things that we give you the opportunity to do that give, I would argue, different types of players, different things to go deep on,” says Half-Life:Alyx character animator Christine Phelan. “With intentionality, we definitely spent a bunch of time trying to figure out what is that line?”
Phelan notes that when there are horror elements, VR is well known to be an intense experience, and modulating that was key to not alienating players. Rather than a relentless onslaught, you are brought up and down.
I checked my Apple Watch heart rate data over the past week that I’ve been playing Alyx and, sure enough, there were the spikes in rate during my play sessions to prove the impact of those choices. Some of the more intense segments play like the best horror action movies you’ve seen — Aliens comes to mind, as well as more recent fare like A Quiet Place.
Keeping you engaged in that environment, of course, means that control schemes are incredibly critical. Valve’s choices on Alyx reflect a desire to make sure that the widest array of people can experience the game. They offer all of the accepted travel modes including teleporting, a continuous travel mode like walking and my favorite, shift — a sort of zooming snap that keeps a sense of context to your movement.
Personally, I am unable to walk continuously in VR without wanting to toss my cookies, and Alyx is no different here. In fact, the game takes a lot of pains to make sure it moves the character involuntarily as little as possible, even offering a ‘toggle barnacle lift’ setting to avoid the motion sickness some people may feel being virtually hoisted in the air. A wise choice as there’s a lot going on in Alyx already, with some encounters forcing you to move rapidly through the environment to combat enemies or solve puzzles.
The sheer accessibility of Alyx’s options speaks to the desire by the team to make sure it accommodated as many people as possible. Standing, seated, either hand, choice of dominant eye, room-scale or not — if there’s a way to play a VR game, Valve has you covered.
One of the biggest effective bits is the presence of Alyx’s hands in the game world. Because most people interact with the world via their hands (though not all), Phelan notes that you get a lot ‘for free’ when you make those the primary interaction method. People already know what to expect when they do things with their hands and at that point your job just becomes to make them act exactly as you’d expect in as many situations as possible.
And they do. Your hands realistically grasp, tap, push and poke the environment (and there is a lot of environment with the most interactive objects I’ve ever seen in a VR game).
The hands even adapt to the contours of things, curving or turning corners as you slide them across objects. The fingers are used to tell you that you really can’t interact with this, but you can feel it — this is not an action point for you. But then, when there is an action point, the hand naturally curves around something, and you get the message “Oh, yeah, I can grab this.”
A lot has been said about the Knuckles controllers that come with the Valve Index headset, and they’re great. But the marquee feature for me is the soft hand strap that keeps them attached to you. This frees you up to make grabbing and grasping motions with your whole hand, as you would normally.
I have the Vive controllers, the Oculus controllers, and the Knuckles. Certainly, the Knuckles, with the individual finger control, absolutely locks it in, I think, for people on the hand interaction. If every company doesn’t dupe the work that Valve has done with these, they’re dumb.
“I think the Knuckles and the Index broadly is essentially Valve’s attempt to say, “This is pointing towards a heightened VR experience. This is what we think of as a really great direction for this hardware to go,” says Valve’s Chris Remo, who also added that they did a lot of work to make sure all the compatible VR hardware turned out a great play experience. “It was obviously pretty important that this wasn’t a Valve Index game. It’s a VR game. We genuinely tried our best to support those features, [including] all the finger tracking the Index does on the Knuckles controllers and everything else.”
A lot of the work on interactions mirrors what other creatives have done in VR, but polishes it up a level. And a lot of that work is hidden unless you look very hard for it. Doors open in the direction of your hand’s travel, for instance. Magically outwardly opening doors that open inward is a perfect affordance. Most people will never notice. The people that care will, and that’s fine, but most people will just have a better time of going through this way versus that way without fussing too much.
The gravity gloves shown off prominently in the gameplay trailers are another such affordance. They neatly avoid the VR problem of people constantly inching out or down and ramming into things outside of their play area while trying to grab objects on the ground or inside containers. They also give the player the ability to quickly utilize the environment to fend off enemies or distract them with a speed and agility that you’d never be able to realize otherwise.
Call it fate or design that Half-Life 2’s gravity gun offered the perfect in-world explanation, but it works incredibly here. Grabbing a gas mask off the ground and attaching it to your face, fending off a headcrab with a trash can lid, throwing a brick to stagger a zombie, it’s all possible with the Russells.
“You can move through a space just as quickly physically, but people do end up taking longer, because you’re naturally invited to do so,” says Remo. “You can look around something in a physical way that just, there’s no equivalent to that in a non VR game. It also meant that you can get up close to props in a way that isn’t really possible or feasible as much in a non VR game, which meant that all that stuff has to actually hold up and be worthwhile.”
I can vouch for the time put in. At one point I grabbed a random half-crushed water bottle laying in a corner and looked inside the mouth to find the interior dimples of the bottom lovingly rendered. One person’s trash, etc.
There’s so many other things that I could talk about here. The use of spatial audio anchored in what seem to be gaussian spheres that attach sound and (incredible) music to environments, with nested encounter scores inside. The dynamic loot system that keeps the balance of the resources you have available to you tuned so that the game remains fun. The encounters that take those early scripted scenes in Half-Life and plus them to create a symphony that taxes and rewards the player for creative and thoughtful gameplay.
It’s not so much that Valve has executed One Weird Trick for making VR good. Many of these major ideas has been tried by one team or another over the past few years. But the execution has never been more precise and thoughtful. One after another the good choices keep coming — and the whole adds up to something truly special and bar-setting.
Inventive, clever and completely engaging, Half-Life: Alyx is the first masterwork of VR gaming.
But that could actually be understating its eventual impact on VR, if that’s possible. Though the template for what a truly A-list title looks like has now been truly sketched, it has always been Valve’s willingness to share its tools that has made the most impact on the gaming scene at large.
That’s why I’m looking forward to an eventual SDK. Hammer 2 is easily one of the best game building tools ever created. Valve is already going to ship Source 2 tools for building new VR levels in Alyx, but as fans of history will remember, the level building scene really took off once the deeper tools to craft a game became available. The ripple effect on the industry will be felt long after people have dissected every sliver of what makes this game so fun. You can trace a major portion of the $1B e-sports industry directly back to mods enabled by Valve being generous with their internal tools.
Imagine what that kind of impact looks like for VR, a field that has been experimenting like mad but has no real coda of best practices for building. It could be massive and though members of the team have said that they’re not currently planning to release an SDK, my hopes are high.
Until then, we have Alyx, and it is good.
We’ve been diligently following the development of virtual worlds, also known as the “metaverse,” on TechCrunch.
Hanging out within the virtual worlds of games has become more popular in recent years with the growth of platforms like Roblox and open-world games like Fortnite, but it still isn’t a mainstream way to socialize outside of the young-adult demographic.
Three weeks ago, TechCrunch media columnist Eric Peckham published an in-depth report that positioned virtual worlds as the next era of social media. In an eight-part series, he looked at the history of virtual worlds and why games are already social networks, why social networks want more gaming, what the next few years looks like for the industry and why isn’t it mainstream already, how these virtual worlds will lead to healthier social relations, what the future of virtual economies will be and which companies are poised for success in this new market.
Given all that has changed in just the last three weeks — who would have thought that large swaths of the knowledge economy would suddenly find themselves entirely interacting virtually? — I wanted to get a sense of what the rising popularity of virtual worlds looks like in the midst of the outbreak of novel coronavirus. Eric and I had a call to discuss this and decided to share our conversation publicly.
Danny Crichton: So let’s talk about timing a bit. You wrote this eight-article series around virtual worlds and then all of a sudden post-publication there is this massive event — the novel coronavirus pandemic — causing a large portion of the human population to stay at home and interact only online. What’s happening now in the space?
Eric Peckham: I wrote my series on the multiverse because I was already seeing a surge of interest, both in terms of consumer demand for open-world MMO games and in terms of social media giants like Facebook and Snap trying to incorporate virtual worlds and social games into their platforms. Large companies are planning for virtual worlds in a way that is actionable and not just a futuristic vision. Over the last couple of years there has also been a lot of VC investment into a handful of startups focused on building next-generation virtual worlds for people to spend time in, virtual worlds with complex societies shaped by users’ contributions.
Talking to founders and investors in the gaming space, there has been a huge increase in usage over the last few weeks as more people hang out at home playing games, whether it’s on the adult side or the kid side.
Most of these next-generation virtual worlds are still in private beta but already popular platforms like Roblox, Minecraft, and Fortnite are getting substantially more use than normal. A large portion of people stuck at home are escaping via the virtual worlds of games.
You wrote this whole analysis before you knew the extent of the pandemic — how has the outlook changed for this industry?
This accelerates the timeline of virtual worlds being a mainstream place to hang out and socialize in daily life. I think people will be at home for multiple months, not just a couple of weeks, and it’s going to change people’s perspectives on socializing and working from home.
That’s a really powerful cultural shift. It’s getting more people beyond the core gaming community excited about spending time in virtual worlds and hanging out with their friends there.
We have seen this most heavily with the youngest generation of internet users. The majority of kids 9-12 years old are users of Minecraft and Roblox who hang out there with friends after school. We’ll see that expand to older demographics more quickly than it was going to before.
One of the complaints that I’ve seen on Twitter is that even though we have one of the largest global human lockdowns of all time, all the VR headsets are basically gone. Is VR a key component of virtual worlds?
Well, you don’t need VR headsets in order to spend meaningful time with others in a virtual space. Hundreds of millions of people already do it through their mobile phones and through PCs and consoles.
This is at the heart of the gaming industry: creating virtual worlds for people to spend time in, both pursuing the mission of whatever a game is designed for but also interacting with others. Among the most popular mobile and PC games last year were massively multiplayer online (MMO) games.
Talking about gaming, one facet of the story that I thought was particularly interesting was the fact that gaming was still not that high in terms of market penetration in the population.
More than two billion people play video games in the context of a year. There’s incredible market penetration in that sense. But, at least for the data I’ve seen for the U.S., the percent of the population who play games on a given day is still much lower than the percent of the population who use social media on a given day.
The more that games become virtual worlds for socializing and hanging out beyond just the mission of the gameplay, the more who will turn to virtual worlds as a social and entertainment outlet when they have five minutes free to do something on their phone. Social media fills these small moments in life. MMO games right now don’t because they are so oriented around the gameplay, which takes time and uninterrupted focus. Virtual worlds in the vein of those on Roblox where you just hang out and explore with friends compete for that time with Instagram more directly.
Theater chains like Regal and AMC announced this week that they are entirely shutting down to wait out the pandemic. Is that going to affect these virtual world companies?
I think they are separate parts of media. Cinema attendance has been declining quite substantially for years, and the way the industry has made up for that is trying to turn cinemas into these premium experiences and increasing ticket prices. Kids are just as likely, if not more likely, to play a game together on a Friday night as they are to go to the cinema. Cinemas are less culturally relevant to young people than they once were.
We’ve seen a massive experiment in work from home, which is a form of virtual world, or at least, a virtual workplace. When it comes to popularizing virtual worlds, is it going to come from the entertainment side or the more productivity-oriented platforms?
It will come from the entertainment side, and from younger people using it to socialize, in part because there’s less fear around cultural etiquette compared to people meeting in a business setting who are worried about a virtual world context not feeling as professional. Over time, as virtual worlds become pervasive in our social lives they will become more natural places to chat with people about business as well.
As more and more people are working online and interacting virtually, a big question is how you get beyond Zoom calls or the technology that’s currently in the market for virtual conferences to something that feels more like walking around and chatting with people in person. It’s tough to do without the ability to walk around a virtual space. You can’t have those unplanned small group or one-on-one interactions with people you don’t know if you’re just boxes within a Zoom call or some other broadcast. It will be interesting to see what develops around virtual business conferences that stems from virtual world technology. I’ve seen a few teams exploring this.
Last question here, but we are looking at a major recession in the economy, and so how does the landscape of people earning money from virtual worlds change with coronavirus?
The second-to-last article in my series is about the virtual economies around virtual worlds. Any virtual world inherently has commerce and people have already been making real-world money from games and from early virtual worlds like Second Life.
Both people staying home amid the coronavirus and the recession that we seem to be entering are pressures that will push more people to look online for ways to make money. That will only increase the activity of virtual economies around some of these worlds, whether those are formally built into the game or they’re happening in a gray or black market around the games (which is more common).
Twitter CEO Jack Dorsey might not spend six months a year in Africa, claims the real product development is under the hood, and gives an excuse for deleting Vine before it could become TikTok. Today he tweeted, via Twitter’s investor relations account, a multi-pronged defense of his leadership and the company’s progress.
The proclamations come as notorious activist investor Elliott Management prepares to pressure Twitter into a slew of reforms, potentially including replacing Dorsey with a new CEO, Bloomberg reported last week. Sources confirmed to TechCrunch that Elliott has taken a 4% to 5% stake in Twitter. Elliott has previously bullied eBay, AT&T, and othe major corporations into making changes and triggered CEO departures.
…Focusing on one job and increasing accountability has made a huge difference for us. One of our core jobs is to keep people informed. We want to be a service that people turn to… to see what’s happening, to be a credible source that people learn from.
— Twitter Investor Relations (@TwitterIR) March 5, 2020
Specifically, Elliott is seeking change because of Twitter’s weak market performance, which as of last month had fallen 6.2% since July 2015 while Facebook had grown 121%. The corporate raider reportedly takes issue with Dorsey also running fintech giant Square, and having planned to spend up to six months a year in Africa. Dorsey tweeted that “Africa will define the future (especially the bitcoin one!)”, despite cryptocurrency having little to do with Twitter.
Rapid executive turnover is another sore spot. Finally, Twitter is seen as moving glacially slow on product development, with little about its core service changing in the past five years beyond a move from 140 to 280 characters per tweet. Competing social apps like Facebook and Snapchat have made landmark acquisitions and launched significant new products like Marketplace, Stories, and Discover.
Dorsey spoke today at the Morgan Stanley investor conference, though apparently didn’t field questions about Elliott’s incursion. The CEO did take to his platform to lay out an argument for why Twitter is doing better than it looks, though without mentioning the activist investor directly. That type of response without mentioning to whom it’s directed, is popularly known as a subtweet. Here’s what he outlined:
On democracy: Twitter has prioritized healthy conversation and now “the #1 initiative is the integrity of the conversation around the elections” around the world, which it’s learning from. It’s now using humans and machine learning to weed out misinformation, yet Twitter still hasn’t rolled out labels on false news despite Facebook launching them in late 2016.
On revenue: Twitter expects to complete a rebuild of its core ad server in the first half of 2020, and it’s improving the experience of mobile app install ads so it can court more performance ad dollars. This comes seven years late to Facebook’s big push around app install ads.
On shutting down products: Dorsey claims that “5 years ago we had to do a really hard reset and that takes time to build from… we had been a company that was trying to do too many things…” But was it? Other than Moments, which largely flopped, and the move to the algorithmic feed ranking, Twitter sure didn’t seem to be doing too much and was already being criticized for slow product evolution as it tried to avoid disturbing its most hardcore users.
On stagnanation: “Some people talk about the slow pace of development at Twitter. The expectation is to see surface level changes, but the most impactful changes are happening below the surface” Dorsey claims, citing using machine learning to improve feed and notification relevance
Yet it seems telling that Twitter suddenly announced yesterday that it was testing Instagram Stories-esque feature Fleets in Brazil. No launch event. No US beta. No indication of when it might roll out elsewhere. It seems like hasty and suspiciously convenient timing for a reveal that might convince investors it is actually building new things.
On talent: Twitter is apparently hiring top engineers “that maybe we couldn’t get 3 years ago”. 2017 was also Twitter’s share price low point of $14 compared to $34 today, so it’s not much of an accomplishment that hiring is easier now. Dorsey claims that “Engineering is my main focus. Everything else follows from that.” Yet it’s been years since fail whales were prevalent, and the core concern now is that there’s not enough to do on Twitter, rather than what it does offer doesn’t function well.
On Jack himself: Dorsey says he should have added more context “about my intention to spend a few months in Africa this year”, including its growing population that’s still getting online. Yet the “Huge opportunity especially for young people to join Twitter” seemed far from his mind as he focused on how crypto trading was driving adoption of Square’s Cash App
“I need to reevaluate” the plan to work from Africa “in light of COVID-19 and everything else going on”. That makes coronavirus a nice scapegoat for the decision while the phrase “everything else” is doing some very heavy lifting in the face of Elliott’s activist investing.
Photographer: Cole Burston/Bloomberg via Getty Images
On fighting harassment: Nothing. The fact that Twitter’s most severe ongoing problem doesn’t even get a mention should clue you in to how many troubles have stacked up in front of Dorsey
Running Twitter is a big job. So big it’s seen a slew of leaders ranging from founders like Ev Williams to hired guns like Dick Costolo peel off after mediocre performance. If Dorsey wants to stay CEO, that should be his full-time, work-from-headquarters gig.
This isn’t just another business. Twitter is a crucial communications utility for the world. Its absence of innovation, failure to defend vulnerable users, and an inability to deliver financially has massive repercussions for society. It means Twitter hasn’t had the products or kept the users to earn the profits to be able to invest in solving its problems. Making Twitter live up to its potential is no sidehustle.
It turns out the virtual and augmented reality companies aren’t dead — as long as they focus on the enterprise. That’s what the Los Angeles-based extended reality technology developer Talespin did — and it just raised $15 million to grow its business.
Traditional venture capitalists may have made it rain on expensive Hollywood studios that were promising virtual reality would be the future of entertainment and social networking (given coronavirus fears, it may yet be), but Talespin and others like it are focused on much more mundane goals. Specifically, making talent management, training and hiring easier for employers in certain industries.
For Talespin, the areas that were the most promising were ones that aren’t obvious to a casual observer. Insurance and virtual reality are hardly synonymous, but Talespin’s training tools have helped claims assessors do their jobs and helped train a new generation of insurance investigators in what to look for when they’re trying to determine how much their companies are going to pay out.
“Talespin‘s immersive platform has transformed employee learning and proven to be an impactful addition to our training programs. We’re honored to continue to support the Talespin team through this next phase of growth and development,” said Scott Lindquist, Chief Financial Officer at Farmers Insurance, in a statement.
Farmers is an investor in Talespin, as is the corporate training and talent management software provider Cornerstone OnDemand, and the hardware manufacturer HTC. The round’s composition speaks to the emerging confidence of corporate investors and just how skeptical traditional venture firms have become of the prospects for virtual reality.
The prospects of augmented and virtual reality may be uncertain, but what’s definite is the need for new tools and technologies to transfer knowledge and train up employees as skilled, experienced workers age out of the workforce — and the development of new skills becomes critically important as technology changes the workplace.
Cornerstone, which led the Talespin Series B round, will also be partnering with the company to develop human resources training tools in virtual reality.
“We share Talespin’s vision that the workforce needs innovative solutions to stay competitive, maximize opportunity and increase employee satisfaction,” said Jason Gold, Vice President of Finance, Corporate Development and Investor Relations at Cornerstone, in a statement. “We’ve been incredibly impressed with Talespin’s technology, leadership team and vision to transform the workplace through XR. Talespin’s technology is a perfect fit in our suite of products, and we look forward to working together to deliver great solutions for our customers.”
Talespin previously raised $5 million in financing. The company initially grew its business by developing a number of one-off projects for eventual customers as it determined a product strategy. Part of the company’s success has relied in its ability to use game engine and animation instead of 360 degree video. That means assets can be reused multiple times and across different training modules.
“Creating better alignment between skills and opportunities is the key to solving the reskilling challenges organizations across the world are facing,” said Kyle Jackson, CEO and Co-Founder of Talespin, in a statement. “That’s why it’s critical companies find a way to provide accelerated, continuous learning and create better skills data. By doing so, we will open up career pathways for individuals that are better aligned to their natural abilities and learned skills, and enable companies to implement a skills-based approach to talent development, assessment, and placement. Our new funding and partnership with Cornerstone will allow us to expand our product offerings to achieve these goals, and to continue building innovative solutions that redefine what work looks like in the future.”
Throughout this series on the rise of multiverse virtual worlds, I have outlined the collision of gaming and social media into a new multiverse era of social media within virtual worlds due to technological and cultural changes. The result will be a healthier ecosystem of social media than what currently exists and the economic development of these virtual worlds such that many people turn to them as sources of income.
The critical question that remains in this final part of the series: Who will be the dominant companies of this multiverse era who build the most popular virtual worlds? Will one virtual world achieve a monopoly or will there be many worlds we hop between on a daily basis? Will the most influential company be the developer of a certain world or an infrastructure layer underpinning many worlds?
(This is the final column in a seven-part series about “multiverse” virtual worlds.)
There are three categories of competitors in position for this new stage: gaming incumbents, social media incumbents and new virtual world startups.
Fictional portrayals of virtual worlds such as “Ready Player One” and “The Matrix” typically portray the physical and virtual worlds as distinct realms siloed from each other. Characters escape a dystopian, impoverished physical realm and enter a separate, utopian virtual realm in which they are wealthy and important.
Our non-fictional future won’t have that dichotomy. One main reason is money. Any virtual world has a virtual economy, and when that virtual economy gets really big, it integrates with our real-world economy. That is in equal parts due to market forces and government intervention.
This is part six of a seven-part series about “multiverse” virtual worlds. We will explore the dynamics of games’ virtual economies, the exchange of virtual assets for real money, challenges with money laundering and underage gambling, the compliance infrastructure needed for virtual economies, and the challenges in balancing a virtual economy’s monetary supply.
To many people, the idea of spending time in virtual worlds amassing in-game currency and trading goods still sounds like the geeky science fiction hobby of someone who needs to “get a real job.”
Our society gauges the worthiness of pursuits based on their social and economic productivity, and most people don’t view virtual worlds as productive places. As more people find enjoyment in virtual worlds and respect people with accomplishments in them, however, vying for accomplishment with those worlds will increasingly be viewed as socially productive. As more people start earning an income through work in virtual worlds, perception of economic productivity will quickly change, too.
Virtual worlds will be viewed as digital extensions of “the real world” and working a full-time job in a multiverse virtual world will become as normal as someone working in a social media marketing role today.
The basis of the classic James Bond film “Tomorrow Never Dies” is an evil media mogul who instigates war between the U.K. and China because it will be great for TV ratings. There’s been a wake-up call recently that our most popular social networks have been indirectly designed to divide populations into enemy camps and reward sensational content, but without the personal responsibility of Bond’s nemesis because they’re algorithmically driven.
(This is part five of a seven-part series about virtual worlds.)
The rise of “multiverse” virtual words as the next social frontier offers hope to one of the biggest crises facing democratic societies right now. Because the dominant social media platforms (in Western countries at least) monetize through advertising, these platforms reward sensational content that results in the most clicks and shares. Oversimplified, exaggerated claims intended to shock users scrolling past are best practices for individuals, media brands and marketing departments alike, and social platforms intentionally steer users toward more extreme content in order to captivate them for longer.
Our impending cultural shift to socializing equally as often through virtual worlds could help rescue us from this constant conflict of interest between what we recognize as healthy interactions with others and how these social apps incentivize us to behave.
Virtual worlds can have advertisements within them, but the dominant monetization strategies in MMOs are upfront purchase of games and in-game transactions. Any virtual world that gains enough adoption to compete as a social hub for mainstream society will need to be free-to-play and will earn more money through in-world transactions than from ads.
Thus far in this series we’ve outlined “multiverse” virtual worlds — a concept different from the metaverse — as the next stage of social media and what this future will look like. It begs the question though: if video games have been massively popular for many years, why hasn’t this shift to online virtual worlds as mainstream social hubs on par with Facebook and Instagram already happened?
(This is part four of a seven-part series about virtual worlds.)
The thought of virtual worlds for socializing evokes Second Life (launched in 2003), where users created unique avatars to socialize, build and trade with each other. Contemporaneous press hype told us that our entry into “the metaverse” appeared imminent, and a 2006 cover story in BusinessWeek magazine featured an analyst who predicted that Second Life could displace Windows as the leading PC operating system.
That didn’t happen.
Granted, Second Life is still around, albeit with only a few hundred thousand active users. Eve Online is another long-running, open-world MMO where the experience is shaped by users’ contributions and social interactions. It’s been the subject of numerous studies on economics and psychology, given the depth of its data on human interaction, but it remains niche as well.
The popularity of Roblox, which surpassed 100 million MAUs and 40 million user-created experiences in August, and Minecraft, which surpassed 112 million MAUs, shows this movement gaining traction in a bigger way among the youngest generation of internet users.
There are both technical reasons and cultural reasons why participation in virtual worlds will finally go massively mainstream in the next few years.
On the technical side, most consumers have lacked the high-performance hardware necessary to meaningfully participate in advanced MMOs while going about their daily lives. And even if they had the right hardware, they weren’t entering one shared virtual space with all other users, they were just entering one instance of that world which was limited in scope and player count by the capabilities of a single server.
That’s all in the process of changing:
Gaming and social media are on a collision course, the result of which will be mainstream popularity of virtual worlds primarily driven by user-generated content (UGC) and anchored in small groups and one-to-one interactions.
Games targeting core gamers will remain a thriving market, and social apps centered on broadcasting content will remain popular for photo sharing and news tracking. However, a lot of our daily online social interaction will shift to multiverse virtual worlds where avatars mark our presence, we own digital goods, earn money from our contributions to the world and gain a deeper sense of community than other types of online interactions.
Most people will participate in multiple virtual worlds depending on their mood, personality, and social circle. A half dozen worlds will be particularly popular but there will be many niche ones. Some may require that you use your real identity (or at least the name on your Facebook account) but most will not.
(This is part three of a seven-part series about virtual worlds.)
These worlds don’t have to remain tied to the norms of our physical world — they can be imaginative realms with different physics. Some worlds may strive to look photorealistic while others will go for artistic distinction. Rules, cultural norms, economic models, and user controls will vary. Some worlds will be oriented around war and conflict, others will be oriented around peaceful commerce and participation in a tranquil society, and still others will take an educational focus looking to simulate areas of Earth for closer study.
Even if you don’t play games, you have spent years of your life in one or more virtual worlds.
Social media platforms like Facebook, Twitter, Instagram and WeChat are lightweight versions of virtual worlds. They don’t offer terrain for avatars to explore, but they are neighborhoods within cyberspace where we store assets, develop relationships and, in some instances, might even choose to hide behind an alias.
The faces we present on these platforms are different from the ones we show our friends in person. While we usually use real names and photos, our presence on Twitter and Instagram is an avatar of sorts. What we do (and do not) post, how we say what we say, how we portray ourselves through selectively chosen (and often edited) photos — it’s an online persona. The aim — conscious and subconscious — is to build social capital within the particular cultural environment of these virtual spaces.
(This is part two of a seven-part series about virtual worlds.)
The social capital gained or lost within a virtual space can connect directly to social capital in the physical world. The worlds are separate but intertwined; what percent of news stories these days revolve around what someone posted on Twitter or Instagram?
Social media apps have virtual economies the same way as games like Fortnite do, they’re just smaller and involve fewer users thus far. There is constant trading of goods and services that exist only within the virtual world of a social app. For example, individuals and companies spend real money on trading Twitter handles, buying Instagram followers, purchasing special image filters and on Twitch memberships that put a badge next to their name to signify their status as a financial supporter of a specific streamer.
On this point, CCP Games CEO Hilmar Veigar Pétursson told me, “there’s not much reality in reality anymore,” given how much of our daily lives in “the real world” are about creating, consuming and interacting online, noting that many social media influencers earn more money in these virtual worlds than factory workers can make building physical items.
Facebook is aiming to build on its VR hardware launches of 2019 with an investment in virtual reality software.
Facebook announced today that it has acquired Bay Area VR studio Sanzaru Games, the developer of “Asgard’s Wrath,” considered by many enthusiasts to be one of the Oculus Rift’s best games. Terms of the deal weren’t disclosed, but the studio will continue to operate its offices in the U.S. and Canada with “the vast majority” of employees coming aboard following the acquisition, Facebook says.
The 13-year-old game studio has created a total of four titles for the Oculus Rift, including “Asgard’s Wrath” and “Marvel Powers United VR,” both of which were at least partially funded by Oculus Studios. Sanzaru has also made a number of titles on console and mobile systems, releasing games structured around their own IP alongside licensed titles for properties like Sonic and Spyro.
Following Facebook’s acquisition of Beat Games in November, the Sanzaru Games purchase showcases Facebook’s continued interest in propping up VR game studios and aligning them around their interests while allowing them to operate independently. While Beat Games’ “Beat Saber” was considered a more mass market title, Sanzaru’s “Asgard’s Wrath” represented a play toward courting serious gamers with a lengthier first-person adventure title.
Facebook has already injected billions of dollars into its VR ambitions and, as the company hopes to build out the content ecosystems of hardware it released last year (including the Oculus Quest and Oculus Rift S), there is little to suggest that their rate of investment will slow in the near future.
Video games are only getting more popular.
Roughly 2.5 billion people around the world played games last year, double the number of players in 2013. Gaming is a $149 billion industry, growing 7% year over year, with the U.S. as its largest market. In America, the average gamer is 33 years old and 46% of gamers are female, according to the Entertainment Software Association.
Per Quartz reporter Dan Kopf’s summary of U.S. Department of Labor data:
More people now report playing games on a typical day — 11.4% in 2017 compared to 7.8% in 2003 — and, on days they do play games, they spend more time doing so — about 145 minutes in 2017, compared to 125 in 2003.
Young people are the biggest driver of the trend. From 2003 to 2015, 15-24 year olds spent less than 25 minutes playing games on the average day. From 2015 to 2017, those in that age group dedicated almost 40 minutes a day to games.
Mobile games account for a large part of this dramatic growth, but all major game categories are growing. The console gaming market — the oldest segment and most expensive due to hardware cost — expanded more than 7% last year alone.
Following web forums, web platforms and mobile apps, we are entering a new stage of social media — the multiverse era — where the virtual worlds of games expand to become mainstream hubs for social interaction and entertainment. In a seven-part Extra Crunch series, we will explore why that is the case and which challenges and opportunities are making it happen.
In 10 years, we will have undergone a paradigm shift in social media and human-computer interaction, moving away from 2D apps centered on posting content toward shared feeds and an era where mixed reality (viewed with lightweight headsets) mixes virtual and physical worlds. But we’re not technologically or culturally ready for that future yet. The “metaverse” of science fiction is not arriving imminently.
Instead, the virtual worlds of multiplayer games — still accessed from phones, tablets, PCs and consoles — are our stepping stones during this next phase.
Understanding this gradual transition helps us reconcile the futuristic visions of many in tech with the reality of how most humans will participate in virtual worlds and how social media impacts society. This transition centers on the merging of gaming and social media and leads to a new model of virtual worlds that are directly connected with our physical world, instead of isolated from it.
Multiverse virtual worlds will come to function almost like new countries in our society, countries that exist in cyberspace rather than physical locations but have complex economic and political systems that interact with the physical world.
Throughout these posts, I make a distinction between the “physical,” “virtual,” and “real” worlds. Our physical world defines tangible existence like in-person interactions and geographic location. The virtual world is that of digital technology and cyberspace: websites, social media, games. The real world is defined by the norms of what we accept as normal and meaningful in society. Laws and finance aren’t physical, but they are universally accepted as concrete aspects of life. I’ll argue here that social media apps are virtual worlds we have accepted as real — unified with normal life rather than separate from it — and that multiverse virtual worlds will make the same crossover.
In fact, because they incentivize small group interactions and accomplishment of collaborative tasks rather than promotion of viral posts, multiverse virtual worlds will bring a healthier era for social media’s societal impact.
The popularity of massive multiplayer online (MMO) gaming is exploding at the same time that the technology to access persistent virtual worlds with high-quality graphics from nearly any device is hitting the market. The rise of Epic Games’ Fortnite since 2017 accelerated interest in MMO games from both consumers who don’t consider themselves gamers and from journalists and investors who hadn’t paid much attention to gaming before.
In the decade ahead, people will come to socialize as much in virtual worlds that evolved from games as they will on platforms like Instagram, Twitter and TikTok. Building things with friends within virtual worlds will become common, and major events within the most popular virtual worlds will become pop culture news stories.
Right now, three-quarters of U.S.-based Facebook users interact with the site on a daily basis; Instagram (63%), Snapchat (61%), YouTube (51%) and Twitter (41%) have similarly penetrated the daily lives of Americans. By comparison, the percentage of people who play a game on any given day increased from just 8% in 2003 to 11% in 2016. Within the next few years, that number will multiply as the virtual worlds within games become more fulfilling social, entertainment and commercial platforms.
As I mentioned in my 2020 media predictions article, Facebook is readying itself for this future and VCs are funding numerous startups that are building toward it, like Klang Games, Darewise Entertainment and Singularity 6. Epic Games joins Roblox and Mojang (the company behind Minecraft) as among the best-positioned large gaming companies to seize this opportunity. Startups are already popping up to provide the middleware for virtual economies as they become larger and more complex, and a more intense wave of such startups will arrive over the next few years to provide that infrastructure as a service.
Over the next few years, there will be a trend: new open-world MMO games that emphasize social functionality that engages users, even if they don’t care much about the mission of the game itself. These new products will target casual gamers wanting to enter the world for merely a few minutes at a time since hardcore gamers are already well-served by game publishers.
Some of these more casual, socializing-oriented MMOs will gain widespread popularity, the economy within and around them will soar and the original gaming scenario that provided a focus on what to do will diminish as content created by users becomes the main attraction.
Let’s explore the forces that underpin this transition. Here are the seven articles in this series:
The specter of constant surveillance hangs over all of us in ways we don’t even fully understand, but it is also possible to turn the tools of the watchers against them. Forensic Architecture is exhibiting several long-term projects at the Museum of Art and Design in Miami that use the omnipresence of technology as a way to expose crimes and violence by oppressive states.
Over seven years Eyal Weizman and his team have performed dozens of investigations into instances of state-sponsored violence, from drone strikes to police brutality. Often these events are minimized at all levels by the state actors involved, denied or no-commented until the media cycle moves on. But sometimes technology provides ways to prove a crime was committed and occasionally even cause the perpetrator to admit it — hoisted by their own electronic petard.
Sometimes this is actual state-deployed kit, like body cameras or public records, but it also uses private information co-opted by state authorities to track individuals, like digital metadata from messages and location services.
For instance, when Chicago police shot and killed Harith Augustus in 2018, the department released some footage of the incident, saying that it “speaks for itself.” But Forensic Architecture’s close inspection of the body cam footage and cross reference with other materials makes it obvious that the police violated numerous rules (including in the operation of the body cams) in their interaction with him, escalating the situation and ultimately killing a man who by all indications — except the official account — was attempting to comply. It also helped additional footage see the light which was either mistakenly or deliberately left out of a FOIA release.
In another situation, a trio of Turkish migrants seeking asylum in Greece were shown, by analysis of their WhatsApp messages, images and location and time stamps, to have entered Greece and been detained by Greek authorities before being “pushed back” by unidentified masked escorts, having been afforded no legal recourse to asylum processes or the like. This is one example of several recently that appear to be private actors working in concert with the state to deprive people of their rights.
I spoke with Weizman before the opening of this exhibition in Miami, where some of the latest investigations are being shown off. (Shortly after our interview he would be denied entry to the U.S. to attend the opening, with a border agent explaining that this denial was algorithmically determined; we’ll come back to this.)
The original motive for creating Forensic Architecture, he explained, was to elicit testimony from those who had experienced state violence.
“We started using this technique when in 2013 we met a drone survivor, a German woman who had survived a drone strike in Pakistan that killed several relatives of hers,” Weizman explained. “She has wanted to deliver testimony in a trial regarding the drone strike, but like many survivors her memory was affected by the trauma she has experienced. The memory of the event was scattered, it had lacunae and repetitions, as you often have with trauma. And her condition is like many who have to speak out in human rights work: The closer you get to the core of the testimony, the description of the event itself, the more it escapes you.”
The approach they took to help this woman, and later many others, jog her own memory, was something called “situated testimony.” Essentially it amounts to exposing the person to media from the experience, allowing them to “situate” themselves in that moment. This is not without its own risks.
“Of course you must have the appropriate trauma professionals present,” Weizman said. “We only bring people who are willing to participate and perform the experience of being again at the scene as it happened. Sometimes details that would not occur to someone to be important come out.”
A digital reconstruction of a drone strike’s explosion was recreated physically for another exhibition.
But it’s surprising how effective it can be, he explained. One case exposed American involvement hitherto undisclosed.
“We were researching a Cameroon special forces detention center, torture and death in custody occurred, for Amnesty International,” he explained. “We asked detainees to describe to us simply what was outside the window. How many trees, or what else they could see.” Such testimony could help place their exact location and orientation in the building and lead to more evidence, such as cameras across the street facing that room.
“And sitting in a room based on a satellite image of the area, one told us: ‘yes, there were two trees, and one was over by the fence where the American soldiers were jogging.’ We said, ‘wait, what, can you repeat that?’ They had been interviewed many times and never mentioned American soldiers,” Weizman recalled. “When we heard there were American personnel, we found Facebook posts from service personnel who were there, and were able to force the transfer of prisoners there to another prison.”
Weizman noted that the organization only goes where help is requested, and does not pursue what might be called private injustices, as opposed to public.
“We require an invitation, to be invited into this by communities that invite state violence. We’re not a forensic agency, we’re a counter-forensic agency. We only investigate crimes by state authorities.”
In the latest of these investigations, being exhibited for the first time at MOAD, the team used virtual reality for the first time in their situated testimony work. While VR has proven to be somewhat less compelling than most would like on the entertainment front, it turns out to work quite well in this context.
“We worked with an Israeli whistleblower soldier regarding testimony of violence he committed against Palestinians,” Weizman said. “It has been denied by the Israeli prime minister and others, but we have been able to find Palestinian witnesses to that case, and put them in VR so we could cross reference them. We had victim and perpetrator testifying to the same crime in the same space, and their testimonies can be overlaid on each other.”
Dean Issacharoff — the soldier accused by Israel of giving false testimony — describes the moment he illegally beat a Palestinian civilian. (Caption and image courtesy of Forensic Architecture)
One thing about VR is that the sense of space is very real; if the environment is built accurately, things like sight-lines and positional audio can be extremely true to life. If someone says they saw the event occur here, but the state says it was here, and a camera this far away saw it at this angle… these incomplete accounts can be added together to form something more factual, and assembled into a virtual environment.
“That project is the first use of VR interviews we have done — it’s still in a very experimental stage. But it didn’t involve fatalities, so the level of trauma was a bit more controlled,” Weizman explained. “We have learned that the level and precision we can arrive at in reconstructing an incident is unparalleled. It’s almost tactile; you can walk through the space, you can see every object: guns, cars, civilians. And you can populate it until the witness is satisfied that this is what they experienced. I think this is a first, definitely in forensic terms, as far as uses of VR.”
A photogrammetry-based reconstruction of the area of Hebron where the incident took place.
In video of the situated testimony, you can see witnesses describing locations more exactly than they likely or even possibly could have without the virtual reconstruction. “I stood with the men at exactly that point,” says one, gesturing toward an object he recognized, then pointing upwards: “There were soldiers on the roof of this building, where the writing is.”
Of course it is not the digital recreation itself that forces the hand of those involved, but the incontrovertible facts it exposes. No one would ever have known that the U.S. had a presence at that detainment facility, and the country had no reason to say it did. The testimony wouldn’t even have been enough, except that it put the investigators onto a line of inquiry that produced data. And in the case of the Israeli whistleblower, the situated testimony defies official accounts that the organization he represented had lied about the incident.
Sophie Landres, MOAD’s curator of Public Programs and Education, was eager to add that the museum is not hosting this exhibit as a way to highlight how wonderful technology is. It’s important to put the technology and its uses in context rather than try to dazzle people with its capabilities. You may find yourself playing into someone else’s agenda that way.
“For museum audiences, this might be one of their first encounters with VR deployed in this way. The companies that manufacture these technologies know that people will have their first experiences with this tech in a cultural or entertainment contrast, and they’re looking for us to put a friendly face on these technologies that have been created to enable war and surveillance capitalism,” she told me. “But we’re not interested in having our museum be a showcase for product placement without having a serious conversation about it. It’s a place where artists embrace new technologies, but also where they can turn it towards existing power structures.”
Boots on backs mean this not an advertisement for VR headsets or 3D modeling tools.
She cited a tongue-in-cheek definition of “mixed reality” referring to both digital crossover into the real world and the deliberate obfuscation of the truth at a greater scale.
“On the one hand you have mixing the digital world and the real, and on the other you have the mixed reality of the media environment, where there’s no agreement on reality and all these misinformation campaigns. What’s important about Forensic Architecture is they’re not just presenting evidence of the facts, but also the process used to arrive at these truth claims, and that’s extremely important.”
In openly presenting the means as well as the ends, Weizman and his team avoid succumbing to what he calls the “dark epistemology” of the present post-truth era.
As mentioned earlier, Weizman was denied entry to the U.S. for reasons unknown, but possibly related to the network of politically active people with whom he has associated for the sake of his work. Disturbingly, his wife and children were also stopped while entering the states a day before him and separated at the airport for questioning.
In a statement issued publicly afterwards, Weizman dissected the event.
In my interview the officer informed me that my authorization to travel had been revoked because the “algorithm” had identified a security threat. He said he did not know what had triggered the algorithm but suggested that it could be something I was involved in, people I am or was in contact with, places to which I had traveled… I was asked to supply the Embassy with additional information, including fifteen years of travel history, in particular where I had gone and who had paid for it. The officer said that Homeland Security’s investigators could assess my case more promptly if I supplied the names of anyone in my network whom I believed might have triggered the algorithm. I declined to provide this information.
This much we know: we are being electronically monitored for a set of connections – the network of associations, people, places, calls, and transactions – that make up our lives. Such network analysis poses many problems, some of which are well known. Working in human rights means being in contact with vulnerable communities, activists and experts, and being entrusted with sensitive information. These networks are the lifeline of any investigative work. I am alarmed that relations among our colleagues, stakeholders, and staff are being targeted by the US government as security threats.
This incident exemplifies – albeit in a far less intense manner and at a much less drastic scale – critical aspects of the “arbitrary logic of the border” that our exhibition seeks to expose. The racialized violations of the rights of migrants at the US southern border are of course much more serious and brutal than the procedural difficulties a UK national may experience, and these migrants have very limited avenues for accountability when contesting the violence of the US border.
The works being exhibited, he said, “seek to demonstrate that we can invert the forensic gaze and turn it against the actors — police, militaries, secret services, border agencies — that usually seek to monopolize information. But in employing the counter-forensic gaze one is also exposed to higher-level monitoring by the very state agencies investigated.”
Forensic Architecture’s investigations are ongoing; you can keep up with them at the organization’s website. And if you’re in Miami, drop by MOAD to see some of the work firsthand.
Esports, video games and the innovations that enable them now occupy a central space in the cultural and commercial fabric of the tech world.
For the investment firm Bitkraft Esports Ventures, the surge in interest means a vast opportunity to invest in the businesses that continue to reshape entertainment and develop technologies which have implications far beyond consoles and controllers.
Increasingly, investors are willing to come along for the ride. The firm, which launched its first fund in 2017 with a $40 million target, is close to wrapping up fundraising on a roughly $140 million new investment vehicle, according to a person with knowledge of the firm’s plans.
Through a spokesperson, Bitkraft confirmed that over the course of 2019 it had invested $50 million into 25 investments across esports and digital entertainment, 21 of which were led by the firm.
The new, much larger, fund for Bitkraft is coming as the firm’s thesis begins to encompass technologies and services that extend far beyond gaming and esports — although they’re coming from a similar place.
Along with its new pool of capital, the firm has also picked up a new partner in Moritz Baier-Lentz, a former Vice President in the investment banking division of Goldman Sachs and the number one ranked esports player of Blizzard’s Diablo II PC game in 2003.
The numbers in venture capital — and especially in gaming — aren’t quite at that scale, but there are increasingly big bets being made in and around the games industry as investors recognize its potential. There were roughly $2 billion worth of investments made into the esports industry in 2019, less than half of the whopping $4.5 billion which was invested the prior year, according to the Esports Observer.
“Gaming is now one of the largest forms of entertainment in the United States, with more than $100B+ spent yearly, surpassing other major mediums like television. Gaming is a new form of social network where you can spend time just hanging with friends/family even outside of the constructs of ‘winning the game.’”
Over $100 billion is nothing to sneer at in a growing category — especially as the definition of what qualifies as an esports investment expands to include ancillary industries and a broader thesis.
For Bitkraft, that means investments which are “born in Internet and gaming, but they have applications beyond that,” says Baier-Lentz. “What we really see on the broader level and what we think bout as a team is this emergence of synthetic reality. [That’s] where we see the future and the growth and the return for our investors.”
Bitkraft’s newest partner, Moritz Baier-Lentz
Baier-Lentz calls this synthetic reality an almost seamless merger of the physical and digital world. It encompasses technologies enabling virtual reality and augmented reality and the games and immersive or interactive stories that will be built around them.
“Moritz shares our culture, our passion, and our ambition—and comes with massive investment experience from one of the world’s finest investment firms,” said Jens Hilgers, the founding general partner of BITKRAFT Esports Ventures, in a statement. “Furthermore, he is a true core gamer with a strong competitive nature, making him the perfect fit in our diverse global BITKRAFT team. With his presence in New York, we also expand our geographical coverage in one of today’s most exciting and upcoming cities for gaming and esports.”
It helps that, while at Goldman, Baier-Lentz helped develop the firm’s global esports and gaming practice. Every other day he was fielding calls around how to invest in the esports phenomenon from private clients and big corporations, he said.
Interestingly for an esports-focused investment firm, the one area where Bitkraft won’t invest is in Esports teams. instead the focus is on everything that can enable gaming. “We take a broader approach and we make investments in things that thrive on the backbone of a healthy esports industry,” said Baier-Lentz.
In addition to a slew of investments made into various game development studios, the company has also backed Spatial, which creates interactive audio environments; Network Next, a developer of private optimized high speed networks for gaming; and Lofelt, a haptic technology developers.
“Games are the driver of technological innovation and games have prepared us for human machine interaction,” says Baier-Lentz. “We see games and gaming content as the driver of a broader wave of synthetic reality. That would span gaming, sports, and interactive media. [But] we don’t only see it as entertainment… There are economic and social benefits here that are opened up once we transcend between the physical and the digital. I almost see it as the evolution of the internet.”