Here are the slides to my GDC presentation, "The Game of Platform Power". In our industry, history repeats itself again and again, but each new generation of developers fails to learn past lessons. Platforms in particular have a well established life cycle and their relationship with a developer changes as they mature. Yet, I regularly see developers completely caught off guards as their new favorite platform suddenly stops being their friend and starts treating them as a harvestable resource. My small hope is that by naming and illuminating some of the common phases and practices of platforms, developers will be able to better deal with the inevitable shifts. I would like nothing better than smart game developers to divorce their businesses from the platform life cycle and build direct relationships with long lasting communities of passionate gamers.

1. This talk was originally titled “How to prevent the inevitable enslavement of game
developers by Facebook”
Thank you for showing up. I know many of you are likely recovering from the parties,
so just making it to this session is a heroic act.
Let’s get your energy moving a bit.
•If you love making games, I want you to yell “Games”! [Big cheer]
•If you make money on Facebook, I want to you yell “Money” [Confused cheer]
•If you love Facebook as a platform, I want to you yell “Facebook” [Dead silence]
That last yell was a bit anemic. Hmm…well, that okay. When comes right down to it,
Facebook doesn’t care if you don’t love them. All they care is if you “Like” them.
[Punchline: Like Icon revealed]. As a platform, all they ask is that you continue to use
their system so they can derive value from your labor.
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2. Here’s who I am. Three things to keep in mind:
•I’ve been in the industry for 16 years and have seen many platforms come and go.
The rise and fall and rise of the PC. Multiple console generations.
•I spent 10 years building platforms both at small companies and at huge companies
like Microsoft. So I have some idea what the sausage factory looks like on the inside.
•I have my MBA, but I am fundamentally a game designer. So I love looking at the
systems behind and how to bend rules in interesting ways.
I founded Spry Fox. We practice what I’ll preach here. We create original IPs and
then build a team around that. The team gets a rev share and is paid if the project is
a success. This is project-based development much like the movie industry uses. It
enable innovation and empowers the developers. We have 6 titles in development
with teams all over the world. We don’t serve the publishers. We don’t serve the
platforms. We make games for our customers. We put our games on new growing
platforms that haven’t yet decided to sink their claws fully into the developer’s wallet.
Honestly, the whole thing is working out far better than I expected.
One thing I’ve learned is that this is a great time to reinvent the game industry. I’ve
seen the old models for making games and in general they are a hellhole of developer
misery. We can learn from the past and build a brighter future.
More info on Spry Fox:
http://www.lostgarden.com/2010/09/announcing-spry-fox-my-happy-new.html
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3. Platforms play games of power. They accumulate power. They use power. And most
developers are completely clueless about how to play and win.
Here’s what we’ll be covering this morning.
•First, an example of platform power
•Second, how the exercise of power can be treated as a game.
•Third, how platforms exercise power
•And last, but not least: How you as a game developer win a game that has
historically been stacked against you.
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4. Let’s talk about power.
4

5. Power is the ability for one part to get another party to do what they desire. Power is
a capability. Having power says nothing about morality. Superman is powerful, but
good. Lex Luther is also powerful, but leans a bit toward mildly evil.
Tons of different tools of power. Official power, coercive power, persuasive power,
etc. It is a deep topic and is the grand scheme of human drives and probably second
only to money and sex. Power is a big deal. Both Platforms and Developers try to
exercise power. It is how we get things done. But very few people actually talk
about it! Let’s start the conversation.
5

6. To illustrate Platform Power, let’s look at an example.
In a galaxy, far far away there was a shining empire known as Facebook. Out of the
goodness of their hears they were making the universe better for humanity. Sam
Lessin, a Facebook Project manager summarizes: "You get at most one — if you're
incredibly lucky, two — shots, maybe, in your lifetime to actually truly affect the
course of a major piece of evolution. Which is what I see this
as.” http://www.time.com/time/specials/packages/article/0,28804,2036683_203718
3_2037185,00.html #ixzz1GoVXNzMN
Then this guy [cue LOLapps image] shows up. The details are shrouded in PR speak,
but it appears that someone other than Facebook was leaking massive amount of
private data to nefarious companies. What is crystal clear is that LOLapps broke
Imperial law.
Seriously though? What is the worst that could happen? This is the internet, right?
This is the place where we are a better, kinder, ‘more evolved’ version of humanity.
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7. Here’s what happened. LOLapps ceased to exist as a consumer facing entity.
Goodbye Alderan.
This is an example of coercive power. You do force someone to do something that
they would generally be unwilling to do.
I make no moral judgments about who was right or wrong in this situation. I only see
the results. Right or wrong, this is a brilliant example of what a platform can do
when you piss them off. This is why no one talks about platform power. If you make
some minion deep in the bowels of a platform angry and they have the power of a kill
switch, then the developer will suffer.
(It should be noted that Platforms don’t like to use coercive power. It generally has
an unpleasant PR backlash. Do it for 20 or 30 years and enough people might get
irritated enough to do something about it. Witness Egypt.)
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8. Here’s how coercive power works in this case. These are Power diagrams. I’ll go
through them in more detail later.
Facebook severed the link between it and LOLapps. Since it was the sole gatekeeper
between LOLapps and the customers, there was literally nothing that they could do.
They couldn’t reach their customers, so they were essentially completely at a whim
of Facebook.
A couple fascinating outcomes here that you can see if this diagram:
• Facebook gains power. The successful exercise of power increases the perception
that you have power.
• LOLapps loses power. They needed to scramble to find an alternative source of
customers or do whatever Facebook requires to reestablish contact with customers.
• Customers lose power. Millions of users who gained value from LOLapps products
were shut off. Facebook moderated this by controlling the message and saying it
was about protecting the customers and by demonizing LOLapps.
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9. Platforms exercise power. This is not an isolated case. I mention Facebook not
because they are particularly egregious in their hunger for power. Really, they are
just yet another platform doing what platforms do.
It doesn’t matter the size of the platform. The number of Flash portals that act like
petty warlords is astounding.
As a long as a company owns a walled garden platform, they tends to abuse
developers. These are the more public examples, but there are dozens more. Every
single developer who has been in this business for more than five years can likely tell
multiple examples of how they have been screwed by a platform or a publisher
middleman. It is kind of like our dark little secret. I suppose that makes GDC bars our
support group.
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10. Why does this even matter?
10

11. Over time…
•Profit margins decrease
•Creative control decreases
•Forced into entangling relationship
•Large increase in financial instability.
I call what is practiced in the console space “Plantation Development”. Developers don’t fair well in
this model. Early in the evolution of a platform, developers are excited to work for their platform
partners. But platforms last for decades and slowly but surely, they erode the freedoms of the game
developers.
As the platform evolves, developers end up in one of two end game positions. They sell out and end
up being a cog in a bigger machine. Or they die as an independent entity. We are all familiar with the
plague of bankruptcy and mass firing that are such a popular business strategy for 3 rd party studios in
the more mature platforms.
You may think that social games are different. But they aren’t. Think about this: Facebook is going to
be around for another 20 to 30 years. If you don’t feel like cheering for Credits and other policy
changes now, imagine how the platform will be treating developers once the hooks are deeper and
they are even more fully entrenched in your business model.
Have you seen social networks in Asia? QQ Zone has a managed game portal, internal studios and a
75% taxes on all transactions. Someone with a thirst for power only seeks more power over the
weaker parties. This is likely the best you will ever have it as a social game developer.
The game of platform power is an old game and we’ve seen how it turns out. It follows a familiar
pattern and leads developers to a familiar end.
The good news is that if you understand the rules of the game, you can hack the system. If you are
clever enough and agile enough, you can maybe, just maybe even beat the system.
11

12. Now you’ve seen a little of what is at stake, let’s define the game of power in a bit
more detail.
Central Premise: Business is not solely an economic activity. It is a political act driven
by money, relationships, and ego. The moves are always based on the accumulation
and use of power. Though many moves are cloaked a false mask of civility and logic,
we are all playing a vicious game of ape dominance.
The win condition is very simple: Gain more power.
12

13. Here’s are the players:
•Initially, there are really only two players that matter: The players and the game
developers who serve them.
•However, by chance or intent, there are people with existing relationships with
players. These connect the game developer with more players.
•Tool provide appear to help game developers make games more efficiently.
•Middle men in the form of aggregators, publishers and protection rackets insinuate
themselves into the mix as well.
13

14. Here are the rules:
A more powerful group (Big circle) has a relationship with a less powerful group
(small circle). If we go back to our original definition of power, that means they can
make the subservient group do what they desire.
It’s a pretty simple diagram.
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15. However, all these relationships form a network. Think of this as your gameboard.
Here’s what social games on Facebook currently looks like. In a single glance, you
have a pretty good idea of who has power and what relationships matter. You can
draw one of these power diagrams for any market and then make predictions on how
it will evolve.
Some interesting points: You can see that Facebook is relatively monolithic. They
tend to be able to make decisions quickly and in unison. The only group with
comparable power are their customers. But groups like the customers or small
games are heavily fragmented. In aggregate they have substantial power, but
individually they have very little.
15

16. Let’s jump right in and start showing how a platform plays the game.
A platform takes an action…you can think of these as playing a card.
These fall into several categories
• Coercive: The player blocks someone from taking an action or forces them to
behave in a manner they’d rather avoid.
• Distribution Power: The player takes control over access to customers.
• Retention Power: The player takes control over the long term relationship with the
customers.
• Monetization Power: The player takes control over extracting money from the
network.
You don’t see the following in this particular game of power.
•Physical Power: No one can hurt another player. Being on a platforms is a voluntary
relationship. This becomes hugely important when we look at developer moves later
on.
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17. Platforms go through phases. They change and evolve. The first phase is the growth
phase. Platforms aren’t even platforms at this stage. They are just another
company, growing like crazy. Everyone loves them and people whisper “Hey, this
might be the new big thing”
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18. Here’s our first Power Card. Almost all platforms start out by being useful. They build
an application that helps users.
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19. Young platform generates value for customers. They build a relationship with
customers by providing an awesome application or service.
This moment shapes the philosophy of the platform. Deep down, they always believe
they are creating value from nothing and are critical to helping customers. No matter
what happens in the future. No matter how predatory the platform becomes, they all
hold onto their platform creation myth, that early moment where they saw an
opportunity and created a vast amount of value. This moment is the seed of platform
righteousness.
Apple made an amazing phone first and foremost. Windows put a personal computer
on every desktop. Facebook is a killer photo gallery and one of the better address
books out there. They changed the world. And in the future, nothing you do as a
developer will ever make a platform company stop repeating over and over again that
they are the primary source of all value in the ecosystem. Your parasitic
insignificance and the platform’s obvious awesomeness justifies everything that
follows.
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20. With the creation of a killer application comes the platform’s first super power:
Distribution. They now have access to a vast number of customers.
20

21. Now we’ve entered the Engage Phase. Platforms have a big resource in the form of
all their customers, but they need help scaling. So they engage with the developers.
Keywords here are Welcoming, Friendly, Enabling. During this phase, the platform is
on the side of the Developer. They want 3rd party developers involved because they
are still building and exploring what is possible with their platform. And let’s face it.
It is far cheaper to get a thousand faceless developers to jump into the
entrepreneurial gristmill than to try and do it yourself.
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22. Allow 3rd party developers access with the goal of accelerating growth
Huge Win All around.
•You create more value!
•You increase retention
•You bring even more users in to your system.
•And it lets you scale without spending lots of money. Developers flock to your
platform and life is good!
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23. Now we start seeing power relationships emerge. The developers are reaching new
customers, but they need to go through the platform.
My Space failed to do this and actively fought against widgets. In the end, they
weren’t able to generate the same value. Facebook actively encouraged 3rd party
developers and so were able to scale and grow faster and bigger.
http://techcrunch.com/2007/05/24/facebook-launches-facebook-platform-they-are-
the-anti-myspace/
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24. Now the platform serves as an intermediary between the developers and the
customers. Here’s another way of looking at APIs: Code is law. A platform with an
API can instantly legislate new behavior for both users and developers. Change a
single line of code and you enact a law that alters the lives and livelihood of millions.
We start seeing the transformation of the platform from a company that creates
value to a company that manages value created by others.
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25. The first step in governing developers is getting them to immigrate to your platform
and make stuff. So you create a honeypot. You find or create a developer success on
your platform. And then you promote them like crazy, tell all other developers that
they could be rich and famous just like your success story. Movie studios do this with
child stars. Everyone knows the joys of being a child star. It is a pretty miserable life
for 99.99% of all kids. Yet all it takes is promoting one Shirley Temple and the masses
flock.
25

26. Examples:
•Doodle Jump and Angry Birds on the iPhone,
•Mafia Wars and Farmville on Facebook.
•Braid alone has inspired an entire generation of indies to throwaway their lives
targeting XBLA. Yes, Jonathan Blow is our industry’s Shirley Temple.
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27. What happens when you’ve collected a bunch of developer and they actually find a
new product category. Roughly 20% of the apps are going to drive 80% of the traffic.
If the platform can own key apps in a market, they control retention of 80% of their
customers. This reduces their dependency on 3rd party apps and grows their empire.
So a classic strategy is to harvest any apps that show promise. Think of this as
nationalizing key industries.
Microsoft did this with Office to maintain control of Windows and with Halo to
maintain control of Xbox. Nintendo does this with all their properties.
27

28. In this example, we see a break out hit in the form of a mobile Twitter client like
Tweetie. The 3rd party developers have successfully tapped a new use case and
started generating an immense amount of value. Instead of letting these happy
entrepreneurs thrive on their own, Twitter bought them, released Tweetie for free.
And then they immediately mandated that other clients stop innovating so that there
was no customer confusion (aka competition).
Due to Twitter’s actions, several 3rd party companies will die or be forced to give up
on their previous business models. In theory this results in a platform losing
developers. It is, afterall, a blatant destruction of trust.
In practice, there are just so many developers that pissing off a handful doesn’t really
hurt a platform. Remember, the developers are fragmented. Even if they are angry,
they can’t must enough of a cohesive response to impact the platform in the least.
Ah the joys of being a powerful platform. Wins like this decrease a platform’s respect
for their developers.
http://thenextweb.com/socialmedia/2010/04/12/burned-scared-twitter-
appdevelopers-burned-scared-replace-twitter/
28

29. Uh oh. We just drew a black weakness card. There’s a risk here. What do you do if
there’s someone who is growing big on your platform and you don’t own them? This
is an “oh crap” moment for a platform.
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30. Let’s take Zynga. 53% of Facebook users play games. 20% of everyone on Facebook
is playing Cityville right now. Zynga is doing everything it can to build direct
connections with customers.
Customers are being pulled in two directions. There are those who game and those
who joined to use Facebook.
Imagine you are looking at long term strategy. What happens to Facebook if Zynga
goes elsewhere? What if Zynga turns off Facebook? What happens if Zynga actively
directs customers to a competing social network? If Zynga has a stronger relationship
with the customers than Facebook has, then Facebook as a company is threatened.
It is at this stage that platforms begin consolidating power. They realize that free
developer friendly, win-win growth results in the platform losing control. Because
some developers might turn into real successes.
Microsoft ran into this problem with WordPerfect many years ago. People bought a
PC to use WordPerfect. Microsoft built Word and ended up completely destroying
Word Perfect in the marketplace. In a game of power, a threatened platform will
happily destroy a developer even if it is adding a large amount of value to the
ecosystem.
http://www.quora.com/Games/What-percent-of-Facebook-users-play-games-and-
what-percent-of-time-spent-on-Facebook-is-gaming
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31. The first thing to do when faced with a challenger is to kill their growth. For
Facebook, this meant killing the viral channels. If you can turn on distribution, you
can turn it off. And then reintroduce it when it suits you. Think of this as a form of
declaring martial law.
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32. Now we’ve entered into the Extract Phase. Most platform companies are highly profit
motivated. Why not use your newly found and highly effective power to line your
pockets?
I will note, that you really don’t need to go here as a platform.
•Linux doesn’t.
•Wordpress doesn’t
•Craigs list doesn’t
•There’s a good chance a platfrom like Android won’t go heavily in this direction.
Platforms can thrive by staying in the Engage phase. Enabling developers and building
a strong ecosystem is enough. If you can deliver value to customers and developers,
you can build a platform that lasts for many decades.
But most platforms dive directly into the Extract phase as soon as they have the
power to do so. It is their nature.
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33. The most direct route to extracting money is to require payment for using the service.
I think of this as taxation.
Remember how platforms start off as services that help customers? At this stage of
their evolution, they’ve transformed into what is effectively a full fledged form of
governments. They have citizens, immigrants, legislations, penalties and now taxes.
When you choose a platform, you are choosing to do business in a virtual country.
The platform starts devoting the majority of its efforts to the act of governance and
proportionally less to the creation of value.
33

34. Facebook provides a lovely example of how a platform can implement a tax. Early on,
a highly competitive and innovative payment ecosystem sprung up that directly
serviced game developers. It was messy and fragmented, but due to the joys of
open competition, the payment provider were doing the following:
• Rapidly innovating new payment models
• Improving their service and reliability
• Reducing their margins and driving efficiencies throughout the system.
In one brilliant maneuver, Facebook severed the link between payment providers and
developers. Credits mean that the payment providers are serving a single monolithic
purchaser of their goods. This means that relationships and the singular needs of
Facebook are more important than the needs of the developers or the needs of the
customers. Open competition and innovation has seen a major and massive setback.
The power of developers has been reduced as well. Instead of being able to find the
best payment system that works for their particular application and users, they now
have a cookie cutter, one size fits all payment method. A uniform set of rules (with
the occasional arbitrary exception) governs all payments. The open bazaar has been
replaced with a Soviet-style dispensary.
It is worth noting that Facebook was ‘nice’ and implemented a relatively low tax rate
for the initial release. In Asia, taxes go as high as 75%. Give it time.
34

35. Now you’d think that the best way for a platform to implement something is the
Power Grab. This card involves legislating a law that is heavily in the platform’s favor.
Platforms are generally autocratic system. They rule by fiat, there is rarely any
representation by those who use their services. If you were to classify the type of
government, smalls one can be seen as warlords, large ones more of a dictatorship.
A dictatorship doesn’t ask constituents what they want. It does tells them what they
need to do. And when you can enact laws by simply changing a line of code, why
not?
35

36. Here’s an example of why power grabs are dangerous for Platforms. In March 2008,
Microsoft arbitrarily increased their cut of XBLA royalties for developers not signed
with a publisher from 30% to 70%. This ultimately failed. They misjudged the
market. It turns out that there was bad PR and a lot more competition from other
platforms than expected.
Look what happens to the power diagrams here. XBLA exercised power, but they
failed. Their perceived power (the dotted line) ended up being false and instead they
were left with their actual power, which was far less. I would go as far as saying that
the primary people who get bad deals on XBLA these days are poor, uneducated indie
developers who do not realize that XBLA doesn’t actually have as much negotiating
power as they are willing to claim in the first open rounds. Information is (quite
literally) power.
36

37. Black card! Turns out that most platforms are really press sensitive. If there is a clear
and obvious breech of fairness, the press will happily report on how platforms are
evil. There are promotions on the line, people! If you don’t provoke the press, you
don’t vest!
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38. A strategy that lets you avoid a public loss of power helps. Luckily the press only
reacts if issues are in black and white. If you implement legislation in a piecemeal
fashion, no one will notice the injustice. Slowly, but surely raise the temperature on
your victim. By the time they are boiling, it is too late to object.
Never appear blatantly evil and the masses and the journalists have no martyr to
latch onto.
38

39. Here’s the Facebook Credits timeline. Over a period of four years, they slowly but
surely implemented a robust method of taxation. They proved technical feasibility,
then negotiated backroom deals with those who might complain and finally
mandated the system for all the smaller groups that had no power. It was really
quite cleverly done and I applaud their talent for execution.
39

40. In the last example, one of the technique we just witnessed was how a platform
forms a beneficial relationship with a few companies.
This is one of the classic ways that developers try to get ahead. They sell their soul
for a chance at special treatment from a platform.
40

41. From the platform’s perspective, this is a version of divide and conquer. First you sign
long term contracts with certain influential developers, so they no longer are playing
by the general rules. This reduces the power of the mob and binds key parties even
more tightly.
There are two types of developer you want to target.
•Your enemies: You want to keep someone like Zynga close and get them as
entrenched in your ecosystem as possible. If they try to leave or cause troubles,
you’ll know it immediately.
•Your puppets. Once you have the ability to be the king maker on a platform, you
want to prop up a handful of yes men who will do your bidding when you want to try
something. They act as your kept early adopters and general lap dogs. You can
promote them as a Shirley Temple if you want PR for an initiative. It can be a good
life for the developer as long as they are useful to the platform. The platform can
always turn them off if they get too uppity.
41

42. Unfortunately, being the special friend of a publisher is notoriously unstable. We like
to think having a relationship with a platform like having a relationship with a person.
But platforms are large companies are not human. They are a collection of
individuals in a crazy Stanford Prison experiment.
42

43. Here’s an example. David Edery was the World Wide Portfolio Manager for Xbox Live Arcade.
He made a lot of deal and forged an immense number of relationships with external
developers. Those developers felt they had a relationship with Microsoft.
Yet consider this: Davide was there for about 3 years. In that time he was reorganized 7
times. Corporate strategy flip flopped at least 3 times. If you make a deal with someone and
they are reorganized, the previously negotiated relationship with that company is effectively
dead.
What remains in the chaos of the reorg are isolated individuals trying to make the best of
things. They find themselves in positions of power. “Hey look at this great contract someone
negotiated” and they exercise that power without the context of personal relationships.
Much like the Stanford Prison Experiment, where normal college students found themselves
abusing others, the reward and control structures surrounding the individuals create a lack of
empathy with those they exercise power over. Developers become resources and pawns in
an abstract game. Metrics, promotions and money are more important than people and
delivering value.
You’ve heard of victimless crimes. Large companies result in crimes with no criminal.
Employees of large companies are simply behaving rationally with no big picture context.
•One person says “All I did was aim the gun.”
•Another says “All I did was pull the trigger.”
•A third complains “All I did was loot the corpse. What do you want me to do? Leave a
perfectly good corpse just sitting there?”
43

44. The other technique that helps push through anti-developer legislation is to loudly
state your message at every opportunity. Platforms do so with the knowledge that
others are not organized enough to mount a counter campaign.
44

45. Since Facebook Credits were in a closed beta or with signed agreements there was
very little data about how they performed. What we’ve gotten is a repetition of the
same message from both Facebook and Facebook mouthpieces: Credits provide “an
easy, convenient and trusted way to buy virtual goods.”
Here’s one survey that was done by Inside Social Games in October 2010. Facebook
Credits comes in at a distance 4th place with <10% likely to use it as their first choice.
Users have other payment options that they prefer using. When real data emerges,
the loudly promoted platform message starts ringing false. But they managed to
control the message for 3 years so by the time real stories come out, it is too late to
protest.
This is all quite fair because from the platform perspective, it doesn’t actually matter
if Credits make developers more money. Credits are strategically necessary as a
means of taxing the ecosystem. Everything else, including messaging, is just an
implementation tactic.
http://www.insidefacebook.com/2010/10/05/social-gamers-are-most-familiar-
comfortable-with-big-brand-payment-services/
45

46. Here’s another common tactic. Hide legal terms that can screw the developer.
Many developers don’t pay proper attention to legal agreements. Platform
companies have entire legal teams that are optimizing their terms to gain maximum
leverage over the developer. The game is played very simply: Put in a half dozen
poison bombs in each standard contract and hope that developers only find one or
two. Or just state “This is our standard contract and we will not change it.”
46

47. As an example consider the terms in Amazon’s Android Store. Hidden way in the
‘standard agreement’: They can distribute your game for free by calling it a
promotion. And if they run a promotion, their share of the revenue jumps from 30%
to 80%. This was a new one. Not even the most unpleasant publisher contracts have
terms like this. Essentially, the app store assumed arbitrary control over giving away
your app. Also they’ve cleverly removed the developer upside from any sort of
promotions.
The developer’s perceived power is high…on first blush it seems like they’ve signed
up for just another app store with just another standard rev share. In reality, they’ve
merrily signed over their game so that someone else can benefit from it.
47

48. Another technique of coercive power. You find someone who is going something
blatantly wrong. And then you use that obvious injustice to enact rules that strongly
benefit the group in power. In broader society, this has been used to justify all sort of
horrible things from the interment of American citizens of Japanese descent to the
creation of the Patriot Act.
48

49. In 2010, Facebook shut down viral channels. Games were getting bad press for spam,
psychological manipulation, sketchy offers. Social gaming companies arguably
brought this on themselves. And that is the genius of good demonization play…there
are actual bad actors doing bad things. The anger is completely justified.
In return, Facebooks implements rules that create a massive incentive for games to
buy more Facebook Ads. For many companies, ads have become a dominant method
of acquiring customers now that the singular promise of social discovery has been
heavily curtailed.
Lesson: A good demon lets a dictator do almost anything.
49

50. There are lots of other techniques of power used by platforms.
Locking down user data to cut off the developers relationship with customers. Gate
keeping to ensure that only games favorable to the platform have a chance. Trojan
Horses in the form of useful technologies that can be leveraged or curtailed at a later
point as a means of gaining additional power.
My favorite is the Reformed Criminal. Find someone breaking one of the labyrinthine
platform laws, punish that company and then out of the immense kindness of your
heart, give them a second chance (as long as they are a perfect citizen and play
exactly by your rules.) A public confession is icing on the cake. You see this technique
show up in 1984 and Clockwork Orange. It works just as well for platforms.
50

51. All the card of power that are played in the Extract phase poison a platform. The
poison is incremental and barely even noticeable to the platform owners, especially
ones caught in a propped up, inward looking world of high profits and growing
revenue. Eventually, however it becomes so onerous to develop on the platform that
developers leave for greener fields.
Suddenly it becomes apparent that the original creation myth of the platform being
the driver of value was a hollow tale from a time long past. Once a platform
company switches from being a direct creator of value to becoming a government for
3rd parties, the vast majority of value in the ecosystem is driven by the 3 rd parties.
When they slip away, one by one, the platform stops being quite so attractive to
users. The value that comes directly from the platform is a joke…a handful of ancient
features propped up on a gilded pedestal and easily replicated elsewhere. Was email
really the killer app for AOL? Are top end 3D graphics really the reason why people
played consoles? So then the users slip away as well. Growth slows, the grand
mission statement start to feel empty. The platform convulses.
No one kills platforms. They kill themselves through greed and mismanagement.
They treat developers like cattle or criminals and then wonder why their grand
empire built on the backs of others is dying.
This takes a while. I suspect that a big platform like Facebook is going to be around
for decades longer. It will probably outlive your career. But still it is good to know
the long arc of history and your place within it.
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52. So that was a pretty depressing story. The game is absolutely stacked against you,
the game developer. This is an asymmetrical game of power.
But you can fight back. If you understand that that platforms will play power games,
you can build a business that survives their ever growing demands.
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53. Here’s the simplest and most powerful tool you have as a developer. If there are
partners that have outrageous terms, don’t partner with them. If you lack the ability
to walk away from any negotiation, you are at a severe power deficit. This is a
general negotiating strategy…every time you make a deal ask yourself what will
happen if you walk away.
A secondary and equally important lesson: Never put yourself in a position where
you can not walk away.
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54. Example: I’ve done some work on browser games and have run into web portals
don’t allow microtransactions. Or they require you to use their payments, but charge
a high taxation rate. Many remove your branding. They remove your outlinks.
These relationships may put your game in front of more people, but they do not
benefit you as a developer. Even worse, the negotiating and dealing with the portals
weird little demands sucks up time. They distract you from more meaningful
opportunities.
Just walk away. They aren’t worth your time. No matter how tempting those large
audience numbers might seem. No matter how many Shirley Temples they hold up
as examples of developer success on their platform. If the deal doesn’t benefit your
future, walk away.
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55. Now you may be tempted by the Publisher and Aggregator weakness card. Here’s the
promise: Fragmented developers signs onto a group that protects them and funds
them. Instead of fragmented, powerless masses, you are part of a single monolithic
organization that can effectively counter the platform.
In the end this merely creates a new umbrella organization that oppresses the
developers.
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56. EA is the classic example. Over a period of two decades they went from idealistic
promoter of developers as stars and artists to a company that was sued for poor
developer working conditions.
Every single week, I get contracts coming across my desk from new portals,
publishers, aggregators and operators. They all push themselves as idealistic
promoters of developers. But when you look at their contracts and you look at their
business plans, they ultimately want to become yet another EA. They want to own
your work, own your customers and control what you make for their benefit. Don’t
fall into the publisher trap.
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57. It turns out that game developers also have super powers. When a platform turns
into a government, developers become the primary source of value creation. You
make amazing games and players come to the platform to play those game.
Greg Costikyn once noted that games are “Endogenous systems of value”. That
means that games creating an internally coherent system of value within their rules.
When a player starts playing a game, they suddenly start feeling that those little
blocky pixels on the screen have meaning. Where application developers struggle to
find some useful niche, game developers regularly and with amazing consistency
create valuable services that users love.
This gives the developer access to a wide range of techniques for holding onto their
freedom.
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58. By gaining multiple sources of customers, you reduce the leverage of any one source.
Be an octopus. Tap into multiple sources of customers.
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59. My favorite example here is Pop Cap. Pop Cap gains revenue from almost every
platform. Facebook has leverage over Pop Cap within its closed garden, but Pop Cap
is always judging Facebook to see if they are a valid opportunity. “What can you do
for me? Not what can I do for you.” If one platform misbehaves, Pop Cap is only
inconvenienced slightly.
Everyone should do this. It radically reduces platform power, increases platform
competition and in the long run creates more balanced platforms that better serve
customers.
Note that this strategy is the antidote to what happened to LOLapps. If they had
differentiated customer sources, they would be a completely different company right
now.
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60. You have more super powers! Game developers own retention. The best games are
activities that users want to pursue for their entire lives. Users keep coming back to
them and weave games into their everyday life.
With the shift to running games as services, our super power has grown even
stronger. Pretty much all the techniques for building intrinsic player motivation are
derived from the game systems and mechanics. You literally cannot retain users
unless you have a talented game designer who understands the psychology of play
and meaning. Ever wonder why game companies like Zynga are snapping up
experienced game developers? They are doubling down on one of their biggest and
most obvious competitive advantages.
Publishers don’t have the tools to retain users. Platforms slowly lose their tools as
they shift away from directly creating value. The modern game developer building a
micro-transactions based game lives or dies based off their ability to retain users.
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61. “If the enemy has a castle on a mountain, go build your castle on a different
mountain.” Sun Tsu
If you can retain users, why not build a community of users with no middle man
involved? Many developers wed themselves to a specific platform’s technology and
customers. A thousand other developers do the same and you end up with a blood
bath where developers compete against developers and the platform reaps the
benefits. Why are you even fighting this battle? You create value and retain users. If
you build a strong relationship with your players, you don’t need to build your castle
in the same crowded platform as everyone else.
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62. Example: Habbo has consistently driven players back to their main site. Portals and
platforms come and go, but a good game can last decades. You only need platforms
for initial customer acquisition. Players who are passionate fans of your game will
happily play on your site. They’ll pay you more money. They’ll value the direct
relationship. You gain control over your destiny and a deeper connection with your
customer.
Every game developer should do this.
This strategy also improves the platforms. When game developers own their own
destination, it does the following:
• Reduces platform power,
• Increases platform’s respect for developers
• In the long run creates platforms at are more like utilities that connect developers
and users and less like power hungry warlords.
• This prevents developers from leaving and creates a richer ecosystem that is better
at creating value for customers.
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63. The game developer’s super power is retention.
•What happens if you actively focus on retaining customers for many years?
•What happens if you make a hobby that last decades?
Ultima Online has been going for 16 years. Habbo Hotel for 11 years.
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64. Here’s what developer victory looks like.
At the center of everything is your game. It is a service that you plan to run for years.
You have a community of users that play your game. They come to your site and you
have a direct relationship with them.
You also have multiple good, mutually beneficial relationships with a set of competing
platforms. These relationships are enforced by sweetheart contracts that are clearly
friendly to the developer.
You uses these platforms to acquire new customers. If any of them start delving too
deeply into the extraction phase of their lifecycle, you cut them off and looks for
customers elsewhere.
You also have competing tools you use to make and monetize your game.
The ecosystem exists to serve you the developer because you ultimately have the
deepest relationship with the customer.
Remember when we talked about the players at the start of this presentation? The
two most important players of the game of power are the users and the game
developers. Year by year, brick by brick you build a tight bond between those two.
Play the long game. Play to win.
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65. 67

66. Q: What about platforms like consoles that typically require 3D graphics?
A: Technology is not a strong differentiator in today’s market. Aim for games and
designs that run on a wide variety of platforms including both mobile and web.
Q: Won’t someone who gets good at playing the platform game become an
oppressor of other developers?
A: It is absolutely possible. I personally have something I keep track of called “Man
points”. If you collect too many, you’ve become The Man.
As I mentioned, not all platforms transition into the extract phase. A lot of this
appears to be highly cultural. Once you have company that is large enough to have
thousands of people, it is really only managed by the philosophy at its foundation. A
company like Valve, who is BTW a massive platform owning over 50% of the PC digital
download market, appears to be all about making games first and foremost. They
don’t generally have the cultural DNA that makes extracting maximum flesh from
other developers a large priority. A company like Microsoft however, does have that
shark-like DNA, no matter how hard they try to suppress it.
Amusingly, Valve has higher revenue per person than almost any other platform
company. If a platform focuses primarily on helping developers create value and
doesn’t act like a greedy dictator, it is amazing how the ecosystem can flourish. Yet
platforms have a cultural blinder on seeing this. Due to their creation myth as the
primary creators of value, they can’t admit that others might be doing more for the
ecosystem. That would be like a king giving up their belief in Divine Right.
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