Analysis: With Facebook Places, Location Based Social Gaming Mechanics Offer Broad Opportunities

Facebook Places was released two weeks ago, potentially allowing every Facebook user to make location-based check-ins. What does it mean for game companies? Many of the stories on Places so far have discussed its potential uses as a marketing tool, doling out coupons, promotions and incentives to users who visit real-world businesses at the right time. There's obviously a lot of potential here. Every physical business wants better ways to promote locally, and will happily pay location-based companies that are capable of bringing customers through the door. However, game developers should think twice about trying to beat marketers at their own business. Straightforward local marketing -- for example, giving users an in-game virtual good or virtual currency for visiting a business -- will become highly competitive soon as marketing service providers push to secure the ad dollars that businesses allocate to location services. While game companies might benefit from partnering with marketers, their internal creative energies can be better spent on what games are all about: fun and engagement. With that advice in mind, we take a look at how game companies can think more deeply about Places, below -- specifically looking at how structure and rules, fictional themes, group cooperation and time tricks can take advantage of the emerging gaming medium. But first, here's a reminder of what Facebook has to offer as it introduces its APIs. Integration with Facebook The first step is getting connected to Places. While this is obvious, the service is still at an early stage, so it's worth going over the details. (If you don't care for the technicalities, feel free to skip on down.) Like other Facebook services, Places is accessed through developer APIs, in this case read, search and write. A large majority of third-party developers will be limited to the read and search APIs, for now. The read API essentially offers access to Places' own data on user check-ins. To give an example, if John checks into Starbucks, Facebook will record and keep that information for itself. If John then gives a third-party application permission to look at his check-ins, the developer of that app can check John's info at will. There's a problem with read privileges: John's direct interaction is with Places, not a third-party mobile app, and the developer also has to get John to go through the steps of agreeing to share his info. Read will work fine for existing Facebook games that want to add a location feature or challenge. It may not be enough for a new iPhone app that wants to use Places, but is separated from the user by Facebook. The write API is the solution to this problem. With write, a third-party iPhone app can log John in through Facebook Connect, perform the check-in itself and report it back to Places and the feed, the latter step potentially helping with viral growth. John is kept in the user interface of the app -- which may be especially vital for an immersive game. Facebook hasn't yet announced when the write API will leave private beta. For now, only five companies who have launched apps have access: Booyah, Foursquare, Gowalla, SCVNGR and Yelp. Locating the game However, it seems likely that Facebook will give write API access to more developers with clearly innovative apps, and high business practice standards. With that in mind, it's time for companies to start planning how to best use Places. Thinking past what location-based developers have done in the past will be the first challenge. When Loopt, Where and others in the first wave of smartphone-powered LBS startups began adding features several years ago, tie-ins with services like Yelp made sense to gather data on actual locations, most of which were in fact businesses. From there, the tendency to favor marketing-based mechanics developed naturally. With only a small market at hand, due to the limited penetration of smartphones, LBS startups needed to make money where possible. That couldn't be the user, so direct relationships with businesses began to appear. The desire to interact with businesses is clearly visible in the most popular location mechanics today. Take check-ins for example. Competing to become the mayor or owner of a property is a mildly amusing, playful task for most users, but the clearest beneficiary from the feature is the coffee shop or store that gets a bevy of repeat customers. More complicated mechanics like "appointment", which makes a game of getting the user to return to a location at a particular time, could be interesting for both users and businesses -- but remain far more so for the latter. Location-based apps should be in the position to make bigger creative bets soon. Places has access to millions of mobile users, and by extension, the other 500-odd million people on Facebook who can see shared Places, and be tagged in them. As in the early days of social gaming, location apps can now focus on convincing an existing mass market that their application is the most fun. So how should location startups that want to focus on gaming think about the problem? Here are suggestions on how to start: Structure One major element of ordinary games, missing from the majority of location-based apps, is a sophisticated structure and set of rules. A popular philosophy today is that location apps should encourage users to get out and experience new things. But how often do, say, World of Warcraft users hear the same advice? Millions of game players consistently prefer to stay indoors, glued to a screen. Their reason isn't a secret desire to be an orc or widespread heliophobia. It's the structure of games, which keep players on track through feedback loops -- truly sticky games, from chess to FarmVille to MMOs, create worlds with strict boundaries and rules. Real life contains few feedback loops that don't relate to food or sex. Location-based apps are based in real life. But does that mean they can't create new feedback loops? Most location apps already make use of trophies and leaderboards, which are certainly game-like. Yet both of those mechanics were created as additions to full-featured games on platforms like the Xbox, to get players more engaged in experiences that were already engaging on their own. Trophies and badges are icing, but they're missing the cake. The trick is thinking of gamelike mechanics for real life. SCVNGR, started this May, allows challenges based around specific locations, like creating origami from the foil in a burrito shop. Booyah's MyTown virtual real estate game drew over three million players before Places launched, with gameplay inspired by Monopoly. These rule-based games are probably just a starting point for a new niche of the game industry. Fiction and Fantasy Closely connected to the need for structure is the idea of theme and story in location-based apps. In ten years, it may seem odd in retrospect that location games started out with a reality obsession. Why should a house, park or store necessarily be the same in its virtual, device-based representation as it is in real life? Here there are again examples to look at. Gbanga Famiglia, released in April by a European developer, is much like MyTown but creates a alternate reality overlay for users to pretend that they're part of a mafia; it's the demo for a platform which could conceivably be used for any game theme. Zombie, Run! has players try to escape in a city from a virtual horde of zombies. The qualities that make a fantasy world or story attractive to players are hard to pin down, especially before those worlds have been created. But good alternate-reality fiction is already proven to work by movies, books, theater -- it simply hasn't found the perfect place in this new form of gaming. Interaction Some of the above-mentioned games, like Gbanga, riff on a social theme: player groups like guilds and, of course, mafias. It's easy to forget with a location-based app, that location itself can just be a means to the end of having fun. Social features may be especially key with Places, since user interaction is Facebook's specialty. Interestingly, a few relatively successful location games have gone all the way to the other end of the spectrum, mostly involving cooperation between strangers with a locational payoff only coming at the end. Geocaching and DARPA's balloon contest are prime examples of users working together for long periods to find locations, rather than first finding the place and then playing a game. Existing services are also pondering how to bring together many users at once. Foursquare, for instance, is developing a group specials feature that could form shopping flash mobs. Facebook may be more interested in seeing apps create personal experiences between friends, though. It's easy to come up with simple ideas for this; for instance, SCVNGR's challenge mechanic could be combined with geocaching for an ordinary guy to leave a trail of clues for his girlfriend, leading to a special dinner date. But again, the best concepts probably have yet to be invented. Time tricks Time is going to be a major challenge for location-based apps of all sorts. Not only does it take quite a long time just to go from place to place, but the daily routine for a great many people is limited to home, work, perhaps a grocery trip, and then home again -- and there's no time or energy left for anything else. Justin Beck, the CEO of Parallel Kingdom creator PerBlue, told VentureBeat that his location-based game started out forcing players to move through the real world to make progress in the virtual game. "The feedback we got from our first iteration was almost uniform: It sucks!," he said. There may be multiple ways to address this problem. One is to make actions that the user already performs in their daily life more meaningful. Alternately, developers can just make location a tightly-integrated feature of their existing short-session games. This might be where the most opportunity lies. An existing Facebook game like Mafia Wars could easily run an Italian-restaurant storyline that offers players the chance to get further ahead in the game if they visit certain locations. The challenge is integrating such features with gameplay in a way that meaningful to the existing story. Conclusion Right now, developers are still in the first phase of innovation, and most existing gameplay mechanics remain rough around the edges. Part of the evolution here will be decided by Facebook's approach. Social gaming as we know it -- games built on friendships and communication channels for reaching those friends -- was made possible by Facebook's open platform. Facebook's master plan has never been to becoming a social gaming platform, as much as social gaming has been discovered and refined by third-party developers. But the process has been messy at times, with spam and scams being prevalent even as developers figured out where the real value was. Facebook's approach to restricting the write API today is intended to curb abuse this time around, especially because location information is, for many users, considered even more private than friend relationships. The company will need to find a balance in how it opens up write access, both preventing abuse while helping developers realize the full potential of the concept. There are other complications. Users have also sometimes expressed wariness toward location services. And then there's the matter of convincing good designers and investors that it's a viable field. Social gaming itself had no shortage of critics and detractors in its early days, but Western investors and entrepreneurs also had the proven model of South Korea, China and Japan to work from -- much of their experimentation on the platform was figuring out what aspects of the free-to-play virtual goods model fit best with Facebook users. There's no equivalent multi-billion dollar industry to compare against here -- just a relatively new technology and millions of potential users, now more accessible than ever through Places. Many of those users may continue to prefer not to share their location on a regular basis, and there are still plenty of other challenges in creating a new location-based service. But Facebook is motivated to succeed in location, and has the scale to change the market; smart entrepreneurs can handle the rest.

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Analysis: With Facebook Places, Location Based Social Gaming Mechanics Offer Broad Opportunities

Chris Morrison

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Chris Morrison