Mainstream approval critical for blockchain games — Gaming execs

Web3 game developers have been battling to gain the attention of mainstream audiences for years, and according to three former gaming executives, that market is essential for the industry’s future.

Video games have become a favorite pastime for a lot of people all over the world and have even evolved into a sport. Overall, there are more than three billion Web2 gamers worldwide as of 2023, according to Exploding Topics. Most are considered casual gamers who play regularly but rarely invest significant time.

Jennifer Poulson, who has worked in the gaming industry for 18 years, including at Web2 gaming companies Bandai Namco (Tekken, Elden Ring, PacMan) and Riot Games (League of Legends), believes mainstream audiences are “absolutely” important for the future of Web3 games.

Speaking to Cointelegraph, Poulson, who is currently vice president of game partnerships at Immutable Games, said in her mind, “Bringing mainstream players into the Web3 space will be essential in the coming years.”

“However, it isn’t so much that we need to entice mainstream players to take the leap into Web3; rather, we need to be building games that are fun to play and will appeal to all gamers,” she added.

Mainstream gamers aren’t particularly fond of crypto, especially when nonfungible tokens (NFTs) are involved.

Blockchain entertainment firm Coda Labs released its Global Web3 Gamer Study in 2022 and found traditional gamers were not fans of crypto or NFTs. Respondents rated their feelings about them at 4.5 and 4.3 out of 10, respectively.

Poulson believes working with mainstream publishers and studios will be crucial for the future of Web3 games.

Because “it’s less about attracting mainstream audiences, and more about working with publishers and studios to understand how and why to integrate Web3 elements into their games.”

Related: Grinding out a living: Can blockchain games really offer a sustainable income?

“The reality is that these are all just games. Some have Web3 elements, and some don’t; as long as they are fun to play, this is what, in essence, determines whether a game is successful or not,” Poulson added.

Web2 gaming companies have also been hesitant to adopt Web3. According to a Nov. 13 State of Web3 Gaming report released by Game7 — a decentralized autonomous organization dedicated to accelerating the adoption of blockchain technology in gaming — six out of 10 Web3 games are being excluded from mainstream distribution platforms.

However, the report found some progress in marrying the mainstream with Web3 and blockchain games. Video game digital distribution service Epic Games Store has been listing more Web3 games every year, peaking at an all-time high of 69 in October 2023.

Could Web3 games survive without a mainstream audience?

Mainstream audiences are important for the future of Web3 and blockchain games, but if the bulk of those players don’t ever make the switch, Poulson believes they will survive and likely “continue as they are today.”

Related: Web3 gaming investors more ‘choosy’ in crypto winter — Animoca’s Robby Yung

However, she thinks that eventually, all games will have elements of Web3, whether gamers are aware of them or not.

“More than likely, the underlying technology will morph into the mainstream gaming world where the average gamer can finally realize the benefits it offers, especially when it comes to ownership of in-game digital assets,” Poulson said.

“Eventually, gamers will not know they are even playing a blockchain game; the Web3 elements will be so seamlessly integrated into gameplay that it will be a similar experience to what playing a game is today.”

Daniel Paez, a former senior manager at major gaming company Blizzard (Warcraft, Diablo, Starcraft), also thinks mainstream audiences are critical for the future of Web3 games because of the sheer size of the player base.

According to an Oct. 9 report from CoinGecko, over 800,000 people play Web3 games daily, regardless of market conditions. However, on average, the Web2 game Minecraft has over 11.9 million daily players.

Paez, the current vice president and executive director for the Web3 card game Gods Unchained, told Cointelegraph that while mainstream audiences are necessary for Web3 and blockchain games to thrive, he is not convinced they are required to survive.

According to Paez, the key to longevity for Web3 games will be to focus more on the player experience instead of blockchain elements.

“This, of course, puts them into direct competition with thousands of other games, but the benefits greatly outweigh the cons,” he said.

“The market for gamers is significantly larger, and you begin to build out communities of players who share the game experience with each other, as opposed to communities of users who hold assets from the same game.”

Paez says Web3 games in search of “longer lifespans” will need the mainstream audience long term because selling content and experiences to players is the foundation of the games industry.

“The challenge for blockchain games is figuring out how the blockchain element can really improve the perceived value a player has of the game,” Paez said.

“The payoffs from figuring this out are huge!” he added.

According to the online data gathering platform Statista, the traditional gaming market is projected to generate over $400 billion in 2023. It is expected to continue growing and reach $584 billion by 2027.

In contrast, the Web3 and blockchain game market has yet to come close to such lofty heights. According to data from market intelligence firm Grand View Research, it was valued at just over $4.8 billion in 2022, with projections predicting growth in the coming years.

Ultimately, Paez believes there will always be room for more “GameFi-esque type games,” however, they will be at the mercy of the crypto markets, which are notoriously volatile.

GameFi, short for game finance, allows players to earn rewards in the form of tokens or NFTs. Players can then use these rewards to purchase in-game assets and cash them out for fiat currency.

One breakthrough application will be all it takes

Michael Rubinelli, who has previously worked at Disney, THQ and Electronic Arts, told Cointelegraph he thinks mass market adoption is vital for the future of Web3 gaming.

Rubinelli, who is currently the chief gaming officer at Web3 gaming platform WAX, said that to attract players, there needs to be a “guiding principle” that clearly shows the benefits of Web3 to both Web2 developers and players.

This “breakthrough application” is what Rubinelli says Web3 games are in search of right now.

“Until such a killer application emerges, conventional gaming companies are likely to remain observers, awaiting guidance from those who pioneer the path,” Rubinelli said.

Related: Free-to-play Web3 games hold the key to mass adoption — YGG co-founder

It’s anyone’s guess if mainstream gaming companies will ever come on board with Web3 games. According to a 2022 survey of Web2 game developers by Coda Labs, three out of four expect to work on Web3 games in the future but did not provide a firm timeline.

Overall, Rubinelli thinks Web2 gamers are important but feels a key indicator of whether Web3 games will stand the test of time will be whether the industry can achieve specific objectives.

“It’s not about whether a mainstream audience is drawn in or not; rather, it’s about reaching a pivotal moment that enables all stakeholders to achieve their product and business objectives,” he said.

“Even if the audience doesn’t materialize, the enduring concept remains: players desire ownership and control over their digital assets.”