Sony Online Entertainment president: The future of game development is wide open by John Gaudiosi @FortuneMagazine June 10, 2014, 11:34 AM EST E-mail Tweet Facebook Google Plus Linkedin Share icons The video game industry has been transformed over the past few years through crowdfunding sites like Kickstarter, which have given birth to companies like Oculus VR and its Oculus Rift and games like Cloud Imperium’s Star Citizen. Now we’re seeing game publishers whole-heartedly integrate gamers into the creation of games. Sony Online Entertainment has embraced open development company-wide as it brings new free-to-play massively multiplayer online (MMO) experiences to life like its zombie survival game H1Z1 and its fantasy role-playing game EverQuest Next. “What we’re trying to do is to expose the development process to our players and get them excited, let them see the stuff we’re making as early as possible and get their opinions on shaping our games,” said John Smedley, president of Sony Online Entertainment. “We consider our players a part of our extended family and that’s a core mantra of who we are as a company. We’ve had success with being very open with them, even including them in things like business model decisions.” This evolution has come about through new technology, including the explosive growth of livestreaming sites like Twitch and the popularity of social networking sites like Reddit over the past few years. “Twitch has been a real revolution in the gaming industry,” said Smedley. “It’s allowed us to stream not just games themselves, but the development process. We’re able to stream our developers working on a level, and we’ll get 5,000 people watching and interacting with us in real-time. We’ve never been able to get that type of immediate feedback throughout the development process.” For its new online zombie survival game, H1Z1, SOE announced the MMO on a Twitch livestream and built up a community of fans through Reddit. They used that Reddit fan base to ask what feature they’d like added to the game. Once it was decided the ability to barricade within the game was important, SOE used Twitch to show the development team working on that feature over the course of 12 hours. At the end of that livestream, which featured the entire development process from design meeting to programmers and artists adding their touches, the feature was added to the game. “We love showing players what goes into the art of making these games because sometimes they don’t understand why something might take longer to create or why we do things a certain way,” said Smedley. “When they see the person doing the work and the tools they use, it really gives them a very deep insight.” This process is also saving SOE time and money. The company discovered they were spending 30% to 40% of development time in the past working on featured they thought gamers would want, but which were never actually used. Now the company just asks gamers about content ideas and moves forward only when there’s a consensus. One recent example was for an Implant System for its sci-fi first-person shooter Planetside 2. When asked, gamers hated the feature, which would have taken six months to develop. The development team scrapped the idea completely and went in a different direction. Ultimately, Smedley said this “democratization of game development” is shortening the length of time it takes to create games and bringing active debates about gameplay experiences into the community. With its new games Landmark and EverQuest Next, SOE is taking things a step further. The developer is handing gamers the exact same tools they use to build these virtual worlds and letting them create their own content. “Our player-driven development process is really at the core of who we are and who we’ve evolved into,” said Smedley, who said the company first started opening the door to player participation with Planetside 2 several years back. In fact, gamers can already create their own in-game items through Player’s Studio. There are gamers who have created in-game content – like camouflage for Planetside 2 – that has generated over $100,000 in revenue. Players receive 40% of these revenues, and the items are sold online through Sony. “We want to expose to our players the work that they themselves are doing for each other,” said Smedley. “We’ve seen many success stories. We are regularly cutting $10,000 checks now, and this is getting to be a very common thing. We’re opening this up to other countries now.” Landmark is an open sandbox game that players can use to build anything they want—from futuristic homes to medieval castles. The game wasn’t originally designed to be a game at all, but after the development team behind the upcoming EverQuest Next saw how much fun it was to make things with these tools, a game was born. “We didn’t know if it would live on as its own game, but it’s evolved into this very vibrant community with real builders that are way better than we are,” said Smedley. “As we develop EverQuest Next, we’re taking a lot of the work we did with Landmark and that the players have done and are importing the stuff that makes logical sense into the new world. We think that’s a very compelling thing to our fans that spend a lot of time building great content and will then be able to see it in EverQuest Next on Day 1.” Smedley said this open development process will evolve beyond PC to include PlayStation 4. EverQuest Next will launch on PC and expand to PS4 in the future. Console gamers will be able to create original content for SOE and get a percentage of the sales of these in-game items. “That’s exactly where we’re headed,” said Smedley. “It’s going to be the same as it is on the PC. There may be slightly different rules there just because it’s a different platform, but that’s exactly what we’re doing. The way it works is we accept it into our marketplace and give them a cut. So to any other player it’s just like something we made, except we do make a point of showing who made it because we want to make them rock stars.” The ability for console gamers to profit from their creativity on consoles was never possible before the launch of PS4. The sheer power of next-gen, coupled with the advent of free-to-play games and a robust marketplace, has set the stage for a new class of amateur developers who never have to leave their home. Smedley said DC Universe Online is the largest revenue generator across PS3 and PS4 combined, even though the game is free to play. With SOE focusing on never-ending online worlds, there’s always a need for new content. Tapping into the creative power of its fans just makes sense. “The conversations we’re having with the folks at SCEA and SCEE are they get the power of free-to-play,” said Smedley, who noted the free Warframe game is the largest revenue generator for PS4 alone. “There’s evidence now. It’s fair to say that consoles took longer to get to free-to-play simply because the business model has been the same way for quite a while now. But they’re seeing this amazing revenue generator from micro-transactions in free-to-play games. SCEA even created a free-to-play category on their PlayStation Store. We’re seeing them embrace it whole-heartedly.” SOE continues to evolve as a company. The days of charging a subscription for online games are part of its history. The future is based on open development, both during the initial stages of a game’s creation and long after launch through micro-transactions and downloadable content. And the company has been able to tap into its hundreds of thousands of players for everything from opinions and ideas to virtual creations.