Games Are For Everyone… Except You

It is well-documented that an increasing number of people are spending time in video games. The world's largest tech companies, including Apple, Amazon, NVIDIA, and Alphabet, are all taking notice and engaging with the gaming industry in various ways.

The focus on gaming is not surprising. Each of these companies are fighting for attention and, increasingly, attention is being spent on games. Games can keep people on platforms longer, expose players to IP in unique ways, bring players back to platforms, and act as an additional stream of revenue.

Despite the potential impact that games can have on a platform, we do not think that games should be everywhere and on all platforms. Just because a company is looking for tools to improve engagement and retention while fighting the “war for attention”, it does not mean that games are a good fit. Two primary categories that we think platforms should consider before potentially integrating games are: 1) the core value proposition of the current offering to users and 2) the existing inherent usage patterns by those same users.

• Value Proposition: The core benefit that the product provides to the user, such as entertainment or connection. The value that games provide can either align with the company's value proposition or distract from it.
• Usage Patterns: These patterns are the typical ways in which a platform is utilized by its users over a specific period of time. These patterns can include frequency, duration, timing, context of use, and level of engagement. The introduction of games is either parallel to these patterns or divergent.

We believe that there are 4 buckets that these platforms fall into as it relates to their relationship with games:

1. Parallel & Aligned: Existing usage patterns mimic patterns seen in games; games are directionally aligned with the company’s value proposition
2. Parallel & Distracting: Existing usage patterns mimic patterns seen in games; games distract from the company’s value proposition
3. Divergent & Aligned: Games diverge from existing usage patterns; games are directionally aligned with the company’s value proposition
4. Divergent & Distracting: Games diverge from existing usage patterns; games distract from the company’s value proposition

This week we want to examine some of the recent examples of large tech companies moving into games, discuss which bucket we believe they fall into, and determine what that means for how games should be implemented.

The New York Times (Parallel & Aligned):

In January 2022, The New York Times (NYT) acquired Wordle for an undisclosed sum in the low seven figures (TechCrunch). Wordle (a daily word game) was not the first game used by the New York Times; it's crossword puzzles have been around for over 80 years (New York Times). Today, the games page on their website has 10 playable games, some free and some by subscription - but almost all of them are only playable once per day. This expansion of their digital games offering through acquisition was successful; there are over 1 million NYT Games subscribers and 10 million people play every day.

This style of game (i.e. daily games) is very parallel to the usage patterns that a normal NYT subscriber is accustomed to: not only are they prone to a daily login to see the latest news, the NYT is a place where people have been going to for word games for almost a century. The NYT is not asking users to change their behavior by logging on more often, or even engaging with the product at a different level. This behavior (log in once, moderately engage, come back tomorrow) is directly parallel to the usage patterns of the core product. These types of games also align with the value proposition of the core product by adding additional levels of engagement and supplementing reading as a mental stimulus.

Even at the time of the NYT’s first introduction of games (crosswords in 1942), games were directly related to the value proposition. The NYT introduced crosswords after the bombing of Pearl Harbor, a time when world news was bleak. Crosswords, while asking users to engage with their product in a slightly more active way (solving a puzzle vs reading news), complemented the core value proposition by providing users a brief reprieve from the weight of the day's news. It allowed readers to consume more and still have a reason to be excited about the delivery of the paper (TIME).

Platforms in this bucket can very reasonably pursue games that align with their usage patterns and value proposition. Importantly, not all games will do this and being selective about which games to implement is crucial.

Microsoft Teams (Parallel & Distracting):

Microsoft Teams is a communication and collaboration application. They introduced games onto their platform in 2022. From a usage perspective, Teams is somewhere between a Telegram and Facebook in that users have it up on their laptop all day, are flipping back to it frequently, and are engaging by responding to colleagues. This pattern of use suggests that some games may be conducive to the platform.

However, we do not believe that games fit well within the value proposition of Teams (or Slack). Microsoft attempts to make the argument that games enable better collaboration, but in terms of the value that games bring to a platform, this is a stretch. Microsoft presented studies that suggest games can improve collaboration, but this is not core to the value proposition of games: entertainment, fun, relaxation, competition, and creativity come top of mind well before bolstering collaborative efforts. Moreover, the study suggested benefits from in-person playing, which would not be the case for users on Teams.

Netflix (Divergent & Aligned):

Netflix launched their gaming strategy in 2021 (Netflix Gaming (81m downloads)). While we believe that Netflix has the funds to potentially become a major player in the gaming industry, games are directly conflicting with the usage patterns of current Netflix users (active vs passive entertainment).

Even if you are operating under the assumption that all Netflix users are actively watching their show and not running it in the background as they work or use their phone, the nature of the experience can be categorized as passive consumption (compared to slightly more engaging consumption like scrolling through social media or reading a book). By introducing a games product, Netflix is asking its users to fundamentally change the way they engage with the platform. Instead of logging on to watch a movie or stream Suits in the background, Netflix is asking its users to pay greater attention, and focus on engaging with a game for an extended period of time. This causes friction with core usage patterns, so much so that <1% of Netflix users play games daily (GamesIndustry.Biz).

Despite the request to change the usage pattern of its users, we still believe that games are aligned with the core value proposition of Netflix. Netflix is a media business that is competing for attention and is used as a form of entertainment for individuals, couples, and friends. Games accomplish both of these goals and can even create additional synergies with their core streaming product by exposing players to intellectual property that they have grown to love in different formats.

Netflix may benefit from games, but they are effectively creating a new business within their organization that competes with all of the incumbents in gaming. We believe that the best way to differentiate themselves is to move into games that are as close as possible to the core usage patterns of their customer, in this case, passive. Attempts like Bandersnatch (an interactive story within a video format by Netflix) or new innovation around AI-driven narratives where users can causally engage with the story aligns much closer to the type of interactions already taking place on these platforms.  

Zoom & LinkedIn (Divergent & Distracting):

Although we did not identify any platforms that fell cleanly into this bucket, we felt Zoom and LinkedIn have significantly large user bases for which their gaming strategies are divergent and distracting.

Zoom: As a result of the COVID pandemic and lockdown, Zoom expanded their platform offering beyond standard video conferencing. In October 2020, Zoom introduced OnZoom, a solution for users to create and monetize events (e.g., classes, shows, concerts). This was generally in line with its core value proposition as a workplace collaboration tool. However, in July 2021, Zoom announced that they would introduce games to the platform.

For a majority of the user base, this was divergent from typical usage of the platform (video conferencing for enterprise-related use cases) and distracted from the value proposition of connecting users for deliberate conversations. Despite this misalignment, the move was expansive. In particular for families and friends looking to spend time together; the ability to play certain games may be parallel to their more casual use patterns and align with the value proposition of connectivity.

LinkedIn: We believe that LinkedIn should also fall into this bucket. While users on the platform spend time casually reading the feed and messaging connections, others spend more time setting up meetings or looking for jobs which places them in a much more professional mindset. For professional users, games will likely create friction and distract from work (LinkedIn’s core value proposition). Even for casual users, though usage is aligned at face value, the underlying intent for everyone on LinkedIn is largely work related. Users can justify scrolling the feed endlessly as the majority of content is work related, but gaming content is inherently the opposite (all about fun not work).

As companies in this category think about allocation of resources, we would warn that games are not easy to make, the market is highly competitive, and this implementation could risk brand dilution and overall strategy.

Takeaway: While the appeal of incorporating games into platforms is understandable given the potential benefits for improved engagement, it is not a one-size-fits-all solution. Platforms should carefully evaluate how games align with their platform's existing usage patterns and value proposition. Introducing games where they complement the user experience can create additional engagement while games that conflict with usage patterns can create friction. The key is to be selective and strategic, ensuring that any gaming initiative is not just a one-off experience, but a natural extension of what the platform already offers.