#70: Big Funge

Would you think it weird if I told you I had a favourite CEO? I realise it is not the same as having, say, a favourite drummer, or biscuit, or whisky1. But I have a favourite CEO, and it is Strauss Zelnick, big boss of US publisher Take Two. I’ve never encountered him in person — which might, now I think of it, be a factor in why I like him — but he just comes across very well: he has Actual Nuanced Opinions on things, isn’t afraid to speak his mind, and above all, is rarely of a mind to follow bandwagons.

Zelnick has proven this again during a week where companies across the game industry published their latest financial results, and CEOs and CFOs waxed lyrical about their firm’s performance and future prospects on conference calls with investors and analysts. This time, with depressing inevitability, the investors and analysts wanted to talk about NFTs. I mean, sure, I can see why. There is a lot of money in these things, and increasingly when these things are used in games, or sort-of-games-if-you-squint-a-bit. Publicly traded companies are obliged to do right by their shareholders, and as such are duty-bound to follow the money. So, Big Publisher X: when are you getting into the business of pixel-art apes?

EA, as you’d expect, is all over that shit. Its CEO, gleaming automaton Andrew Wilson, this week proclaimed NFTs “the future of our industry.” What he really means is that they represent a clear and obvious way to 10x revenue from FIFA Ultimate Team, and he almost said as much. “In the context of the games we create and the live services that we offer,” he honked, “collectible digital content is going to play a meaningful part in our future.” You can almost see the dollar signs in his eyes, can’t you. EA and FIFA are having a Mexican standoff over naming rights at the moment, and one reported issue is that FIFA wants EA to have narrower rights to the name, leaving FIFA free to license it out to other developers. EA wants to broaden the deal’s scope — including, yep, the use of NFTs. Smashing.

Over to Ubisoft, which has of course been fiddling around with blockchain things for a while now. In fairness to Yves Guillemot and co, Ubi has always taken an interest in nascent, somewhat unfancied technology in which it sees a certain potential: it was a keen supporter of VR from the get-go, and it even made games for Wii U (sorry, low blow). Guillemot told investors this week that blockchain is “very attractive for the long term… this industry is changing regularly with lots of new revolutions happening. We consider blockchain one of those revolutions. It will imply more play-to-earn that will enable more players to actually earn content, own content, and we think it’s going to grow the industry quite a lot. We want to be one of the key players there.” Hnngngg.

Over we go, then, to Zelnick, who gave an interview to GI.biz this week ahead of Take Two’s financial results being published — and it is perhaps this setting that enables him to speak a little more freely, because out comes the nuance. It is well worth a read, if only for his elegant deconstruction of the concept of the metaverse as envisioned by Zuck et al. “If you define metaverse as ‘everything we do in the world physically will become digital’,” he parps, “then you’re talking to a skeptic.” Nice.

He admits that NFTs are appealing as a concept. He believes blockchain is “a very useful technology”, but one that “hasn’t found many uses yet outside cryptocurrency.” He acknowledges that there is a lot of money being made from NFTs at the moment — but that, he believes, is why he should not to hitch his company to the bandwagon in search of untold nonfungible riches. Imagine!

“I’m a big believer, but what I don’t believe is that just because something is digital or an NFT, that it suddenly has value, or has value that will be increased in the future. And I think that’s the problem. NFTs, because they relate to the blockchain as currently contemplated and because some have gone for a lot of money, are seen by some as just another opportunity to invest in a speculation that some think will only go up. And speculations don’t just go up. They come down too.

“For an NFT to be valuable and durable, it has to be found at the intersection of rarity and quality; of rarity and value. And there’s rarity for sure in all NFTs, but I’m not sure there’s value.”

Fucking yes. That’s it right there. The nuance! The shades of grey! He could almost write an edition of Hit Points. This is the point with NFTs. They are not necessarily a bad thing. One day, they might even be a good thing. But they are not that thing yet, by a long stretch. I suspect Wilson and Guillemot understand this, too, but lack the confidence or the gumption to say it. One day, perhaps, but I shan’t hold my breath.

MORE!

• Sticking with Take Two for a moment, its financial results revealed a whopping $53m writeoff caused by the cancellation of a project that Mafia III developer Hangar 13 had been working on since 2017. The publisher has assured the 200 staff who worked on the project, which was codenamed Volt, that their jobs are not at risk. Not sure where this leaves Zelnick’s ranking in the CEO league tables. Postponing judgement for now.
• I saw some fuss yesterday about Forza Horizon 5, which officially launches on Tuesday but is playable now to those who buy the premium edition (or upgrade to it for a discount through Game Pass). While this is not a new thing for the series, I’ll admit it does rub me the wrong way a little given the whole ‘Play It Day One On Game Pass’ thing that Microsoft has been trumpeting for the last couple of years. It’s a tiny thing, for sure, and there’s nothing I can do about it except get into a lengthy semantic debate with myself over what constitutes ‘Day One’, and I’ll happily wait until Tuesday. It does sting a bit given it’s now the best-reviewed game of the year, though. I hope it’s the exception, rather than the rule, for future firstparty stuff on Game Pass.
• Devolver Digital is now a publicly traded company, ending its first day on the London Stock Exchange valued at just shy of £700m. PlayStation snapped up a 5% share in the publisher.
• Square Enix president Yosuke Matsuda has admitted that Marvel’s Avengers delivered a “disappointing outcome”. In a coded and quietly brutal burn for developer Crystal Dynamics, he added: “Taking on the GaaS model highlighted issues that we are likely to face in future game-development efforts, such as the need to select game designs that mesh with the unique attributes and tastes of our studios and development teams.” Ouch.
• Bandai Namco showed off 15 minutes of Elden Ring gameplay yesterday and while I’m sure you’ve seen it already, let’s all watch it again. It looks sumptuous. It’s also sparked an addendum to Wednesday’s edition of Hit Points: horses with double-jumps, I now realise, are nice. February can’t come soon enough.

That’s your lot! As ever, if you’ve enjoyed today’s installment, do please give it a share, either by interfacing with the buttons below, or by forwarding the email to a pal or colleague. And maybe subscribe! If enough of you do it today, perhaps I’ll pony up for the Forza premium edition after all. Have an excellent weekend, and I’ll see you all on Monday.