Blockchain has been the trending topic in recent years for its potential to disrupt a range of different industries. The technology’s immutable, programmable, and transparent nature has given birth to many innovations, ideas, and potential applications.
The multi-billion dollar gaming industry is one such sector where the technology has some promising use cases. Perhaps one of the most pertinent areas within gaming that is ripe for transformation, and holds significant benefits for indie developers and gamers alike, is gaming distribution.
If you have ever developed or bought games, you might have noticed a recurring problem. It is undoubtedly expensive to sell games on a distribution platform, and it’s also expensive to purchase games as well. The good news is that blockchain technology has the potential to benefit both developers and players by alleviating the main issues that make it expensive to sell and buy games in the first place.
Centralized distribution platforms mean high costs
Gaming distribution is heavily centralized. Building a decentralized gaming ecosystem that benefits players and developers can become a reality with the help of a blockchain. The technology removes the need for a central intermediary and therefore eliminates the expensive intermediary fees and commissions that have become a burden on developers and gamers trying to sell and purchase games.
Lack of resources & leverage
In recent years, independent game development has been on the rise. A growing number of developers are opting to leave large game development companies and publishers to pursue their creations. However, these developers are faced with a major problem when trying to sell their games. The problem has to do with game distribution and a lack of a fair revenue split model.
Naturally, indie game developers are often challenged with a lack of resources. And so, when entering into the game development market, developers find themselves at a disadvantage when trying to negotiate table regarding revenue splits with large distribution platforms. It’s David vs Goliath. Independent developers simply have little power or leverage to muster.
Unfair revenue sharing models
Indie game developers lose a considerable share of their profits at the distribution level. But to sell a game and reach a wider audience, developers have little choice but to partner with large distribution platforms, such as Steam.
Despite the emergence of virtual distribution, intermediary costs are often still quite high. There are, however, many reasons as to why the cost of distribution and purchase cost of games is unjustified. Of course, the high cost of games mainly benefits the large publishing and distribution platforms, while leaving consumers and developers left out in the cold.
With so much power, distribution platforms are able to dictate terms which are unfavorable to indie developers and consumers as well.
What are the wider industry implications?
The high costs incurred by indie developers and gamers have negative ramifications for the overall gaming industry. Developers are deterred from developing new games due to high costs and low-profit margins, and this results in a smaller amount of games which users can enjoy.
The large distribution platforms that serve as a middleman between developers and consumers must be eliminated to give more power & financial incentive to independent developers and make games more accessible to consumers.
Decentralizing game distribution
Eliminating the large and centralized gaming distribution platforms seemed impossible just a couple of years ago. However, with the advent of blockchain technology, the balance of power can shift back to indie developers and consumers.
Decentralized blockchain gaming platforms can usher in a new era of fair, direct, and transparent distribution of games to players, and support independent game developers by increasing their revenue. It’s win-win. By cutting out the middleman, game creators will be able to lower game prices for the end users while generating higher profits for their own pockets.
But that’s not all.
Decentralized gaming platforms will incentivize and enable developers to develop more creative games. They will also give developers full ownership of their creations as well.
GameCredits is an example of a decentralized platform which connects gamers and developers. Developers can receive 90%, rather than 70% of the monetary amount spent by consumers without long payout periods and opaque contract terms – a problem that often occurs when dealing with third-party partners.
If you’re interested in discovering other ways that blockchain technology can transform the gaming industry, be sure to check out these two articles –