Saturday, April 4, 2020

Epic Games Reveals Fix For Fortnite Deadpool Week 7 Bug

After seven grueling weeks, Deadpool is finally available to unlock in Fortnite, but some players running into problems with that.

The skin is available to everybody who completes the Week 7 challenges, which requires players to track down Deadpool's two guns and then jumping into a portapotty or phone booth.

For many players, this is all they'll have to do. However, for a huge group of players, this is bugged and they are not being rewarded with the skin.

It's quite frustrating to see others running around as the Marvel hero while you're locked out of the content completely, but Epic Games has finally addressed the issue and said they are working on a fix and it's currently in the process of rolling out.

Epic GamesThe Yacht has been taken over.

"A fix is rolling out for the Deadpool Week 7 challenge," said Epic on Twitter. "It will take some time to for the fix to reach everyone, thank you for your patience! We'll provide another update once the challenge has been successfully granted to all Battle Pass owners."

A fix is rolling out for the Deadpool Week 7 challenge. It will take some time to for the fix to reach everyone, thank you for your patience!We'll provide another update once the challenge has been successfully granted to all Battle Pass owners.

— Fortnite Status (@FortniteStatus) April 3, 2020

The fix is not yet live, but Epic said they will continue to update players as it moves through the process.

Hopefully, players will be able to get their hands on the new skin by the end of the day. Even if you haven't been able to secure the skin yet, you'll still notice the game has received a bunch of new twists.

The first change you'll notice is the Battle Bus has been given a Deadpool paint job and The Yacht location has been completely taken over by the merc with a mouth.

Now, this means Mr. Meowscles had to get the boot and he surely isn't happy about that. We'll have to see if he decides to get his revenge in some way in the future.

Fortnite Chapter 2 – Season 2 is out now on all platforms.

Friday, April 3, 2020

Epic mostly wins Fortnite saxophone lawsuit, but judge lets one claim go forward

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  • Epic mostly wins Fortnite saxophone lawsuit, but judge lets one claim go forward New, 3 comments

    It's still bad news for dance lawsuits

    By Adi Robertson@thedextriarchy Apr 2, 2020, 10:24am EDT Share this story
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  • Photo by Vjeran Pavic / The Verge

    Epic Games has mostly prevailed in a lawsuit over its "Phone It In" Fortnite emote, although saxophonist Leo Pellegrino can continue with a claim of false endorsement. A Pennsylvania judge ruled on the case earlier this week, offering a rare legal exploration of whether you can own a signature dance move — and the results look good for Epic.

    Pellegrino sued Epic last year for allegedly misappropriating his likeness with the Fortnite dance. He argued that the "Phone It In" dance was inextricably linked to his musical performances, and Epic was copying it to profit off his fame. District court judge John Padova wasn't convinced. He dismissed seven of Pellegrino's eight claims and denied a request to amend and resubmit them, concluding that their reasoning is fatally flawed.

    Padova says Epic has sufficiently "transformed" Pellegrino's likeness with the emote, so it's protected by the First Amendment. The dance might be recognizable. But it's not tied to other aspects of Pellegrino's identity, which makes the move "primarily Epic's own expression rather than Pellegrino's likeness." It cites the fact that Fortnite avatars don't look like the saxophonist nor share biographical details with him: he's a musician who performs the move during shows, and Fortnite characters are fighters in a battle royale tournament.

    Pellegrino also claimed a trademark on the dance, but these claims didn't hold up either because Padova concluded they're preempted by copyright law. Essentially, Padova says that if Pellegrino's dance is protected by intellectual property law at all, it should be a matter of copyright — which explicitly covers creative choreographed dance sequences. So he can't assert trademark protection (which can last indefinitely, while copyrights expire) as an end run around copyright law.

    And as we wrote last year, that was probably Pellegrino's exact strategy. Several earlier Fortnite lawsuits accused Epic of copyright infringement. The short dances in question weren't clearly copyrightable, though. They fell into a murky ground between non-protected single dance steps and protected choreographed routines. Then, a Supreme Court decision raised the bar for filing suits, requiring a response from the US Copyright Office first. That meant several cases were temporarily dismissed, and later complaints — like Pellegrino's — have often focused on Epic stealing likenesses instead of copyrighted moves.

    This case is bad news for that gambit. It determines that a dance isn't enough to establish a likeness, and it closes the door to basic trademark claims, leaving dancers more dependent on an increasingly tenuous-looking copyright strategy. Fortnite lawsuit attorneys have said they've obtained copyrights for some dances, but at least one high-profile dance was mostly rejected by the Copyright Office.

    Padova did keep the false endorsement complaint open. But legal expert and blogger Eric Goldman, who consistently covers the Fortnite suits, doesn't find its argument very convincing. The court didn't say Pellegrino would prevail, simply that his claim wasn't obviously barred by an established legal doctrine. So while this case doesn't establish that copying dances is legal, and definitely doesn't establish that it's ethical, it narrows the path to victory for emote lawsuits.

    In This Stream The Epic emote debate: all of the news about Fortnite's ongoing dance lawsuits View all 12 stories Next Up In Gaming Sign up for the newsletter Processor Email (required) By signing up, you agree to our Privacy Notice and European users agree to the data transfer policy. Subscribe

    Thursday, April 2, 2020

    Epic Games reveals new mobile game Spyjinx in collaboration with J.J. Abrams’ Bad Robot Games

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  • Epic Games reveals new mobile game Spyjinx in collaboration with J.J. Abrams' Bad Robot Games

    An espionage-themed iOS and Android title

    By Nick Statt@nickstatt Apr 2, 2020, 8:13pm EDT Share this story
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  • Image: Epic Games

    Fortnite creator Epic has revealed a new mobile game developed in collaboration with J.J. Abrams' game development company Bad Robot Games, a spinoff of his production studio Bad Robot that was formed back in 2018 with funding from Epic investor Tencent. Abrams previously collaborated with Epic to debut a trailer of Star Wars: The Rise of Skywalker within Fortnite.

    The title, called Spyjinx, is an espionage and secret agent-themed action adventure game that appears to let you build your own hideout, level up your character, and compete in some form of online multiplayer to take on other players. It looks like it borrows heavily from the art style of Fortnite, specifically the recent second season of Fortnite Chapter 2 that also happens to be espionage and secret agent-themed.

    There's not a ton of other information about Spyjinx beyond the brief description of its theme and some screenshots the companies shared. But Epic said yesterday it would be launching a beta test in Malaysia on iOS, with Australia to follow soon after.

    "Set in a secret world of espionage, thrilling heists, and high-tech gadgets, Spyjinx is a unique mix of action-strategy gameplay, RPG character development, and head-to-head multiplayer. Your goal? Become the ultimate spy Mastermind," reads the game description.

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    Wednesday, April 1, 2020

    ‘Fortnite’ Creator Epic Games Wants To Make Game Publishing A Little Less Evil

    'Control' developer Remedy Entertainment will publish games with Epic Games Publishing.

    Credit: Remedy

    Once upon a time, Google had a motto: Don’t be evil. After restructuring under the conglomerate Alphabet Inc in 2015, this was changed to Do the right thing.

    Not as catchy, right? And also not as clear. Don’t be evil is a pretty clear and concise moral code. It places you in either the Good or Neutral camps on the Alignment Chart.

    Do the right thing, on the other hand, is all a matter of perspective. If I was an evil overlord instructing my minions, I could tell them to “Do the right thing” and it could still be evil. Hitler probably once said to Himmler, das Richtige tun, but it sure didn’t mean “don’t be evil.”

    In other words, don’t trust Google to not be evil. Along with the big social media giants, Amazon and every other giant tech company, power and influence are corrupting factors.

    Then there are the video game publishers like EA, Activision, Tencent and all the rest. “Don’t be evil” has never been a motto of these companies. Even beloved developers like CD Projekt RED and Naughty Dog have subjected their workers to enormous amounts of crunch.

    For that matter, so have Epic Games, delivering content for Fortnite at such a rapid pace last year that reports of crunch were all but inevitableâ€"though those reports may have resulted in at least a little change as the game’s rapid updates have slowed in 2020.

    To its credit, Epic Games and CEO Tim Sweeney have been trying to enact positive changeâ€"albeit vis-a-bis controversial meansâ€"in the gaming industry ever since Fortnite became the world’s biggest hit and started making the company billions.

    The Epic Game Store was the company’s first foray into enacting positive change in the video game industry. Epic was taking on Valve, the company behind the biggest PC gaming storefront in the world, Steam. They did this by gaining timed exclusivity to a bunch of popular upcoming games like Borderlands 3. And they gave all developers, whether exclusive or not, a far better cut than Steamâ€"88/12 vs 70/30.

    Now, Epic Games is officially getting into the game publishing business with Epic Games Publishing and they’re trying to make the relationship between publisher and developer a little less evil as well.

    Epic’s first partners in this new venture are gen DESIGN (The Last Guardian), Playdead (Inside, Limbo), and Remedy Entertainment (Control). Epic will publish multi-platform games from these studios but not with terms we’re used to seeing in the video game industry.

    “We’re building the publishing model we always wanted for ourselves when we worked with publishers,” Sweeney said in a statement.

    Here’s how Epic Games Publishing plans to make the relationship between developer and publisher healthier and more fair:

  • Full creative freedom and ownership. Developers retain 100% of all intellectual property and full creative control of their work.
  • Fully-funded projects. Epic Games Publishing will cover up to 100% of development costs, from developer salaries to go-to-market expenses such as QA, localization, marketing, and all publishing costs.
  • 50/50 profit sharing. Developers earn a fair share for their work â€" once costs are recouped, developers earn at least 50% of all profits.
  • This is huge. Creative control and ownership of IP means that even if a studio parts ways with EGP in the future, they can keep making games in that franchise. We’ve seen high-profile instances of developers losing an IP when they broke off from a publisherâ€"think Bungie and Halo or Hideo Kojima and Metal Gear. With this deal, studios and creatives wouldn’t have to risk losing their creations.

    The full funding of games plus 50% of profits after Epic recoups costs is also a huge step forward for developers. Most importantly, this sets a new precedentâ€"one which may not spur every other publisher in the business to make similar progressive changes, but which will tip the needle toward fairness.

    All told, this is great news and I can’t wait to see what games gen DESIGN, Playdead and Remedy come up with. I expect we see many more studios follow suit, just like many game companies gladly hopped on-board the Epic Game Store with timed exclusives. Money matters in this business just as much as any other.

    Tuesday, March 31, 2020

    Houseparty: How safe is Epic Games' video chat app?

    The messages began circulating at the weekend: "Delete the Houseparty app, it's hacked my Spotify account!"

    Like many rumours, the posts went viral across both public networks, like Twitter and Facebook, and closed forums on WhatsApp and Snapchat.

    They have become so widespread that Houseparty itself says it is a victim of a "paid commercial smear campaign".

    The US firm's owner Epic Games is now offering $1m (£803,000) bounty for evidence that a "malicious actor" is behind the claims.

    So is Houseparty hacking people?

    The consensus in the information security world is that it's highly unlikely the app is actively breaking into people's other accounts.

    Although relatively unknown until the pandemic, Houseparty was acquired last June by the well-established company behind the hit game Fortnite.

    "These posts seem very clearly to imply that Houseparty is a rogue app that is actively breaking into every part of your digital life and plundering it in a determined burst of criminality," says Paul Ducklin a researcher from cyber-security company Sophos.

    "But this is a mainstream app published by a well-known software company in Apple's and Google's official online stores."

    Warning message

    That's not to suggest that Houseparty is too big to get hacked. There are numerous examples of well-resourced companies having flawed products and many other examples of organisations inaccurately denying they have been hacked, either knowingly or not.

    However, the nature of this incident isn't consistent with usual cyber-criminality.

    "Normally when a cyber-crime group breaches a company or downloads a user account database, the data is sold at a high price and used very carefully," explains Elliott Thompson, consultant at SureCloud.

    Story continues

    "If a scam group purchased data for $10,000, it wouldn't make sense financially to burn the data by trying to steal accounts for streaming services.

    "Similarly, if the breach was widely available, it would typically appear on public forums and we've certainly not seen anything like that."

    Experts say the alleged breaches are probably linked to unrelated hacks, and it's a coincidence that people are reporting falling victim shortly after downloading the chat app.

    "When people use the same passwords and email addresses for many different services, hackers only need to get access to one of those website databases and they suddenly have access to all your accounts," Mr Ducklin adds.

    "With Houseparty being the new app on so many people's phones, this could be why people are pointing fingers in that direction right now."

    Is there a co-ordinated effort to smear Houseparty?

    Epic Games certainly seems to suggest there is an organised campaign.

    "Our investigation found that many of the original tweets spreading this claim have been deleted and we've noticed Twitter accounts suspended," it says.

    But the BBC spoke to two people whose posts were shared widely and they don't appear to be in any way co-ordinated or following paid orders.

    One woman said she posted a warning and advice on how to delete the app simply because she wanted to help others.

    The video chat app has been the most popular Android and iOS download in many countries across the world in recent days

    Another 26-year-old woman from Scotland tweeted that she and her friend's Spotify, Amazon, PayPal and online bank accounts had been hacked since downloading Houseparty.

    Speaking to the BBC by phone, she admits she has no evidence to link Houseparty to her compromised Spotify account. She says she only made the connection after seeing a screenshot of someone else making a similar claim.

    "Me and my friends have used Houseparty almost every night since the virus started and we really enjoyed playing the games as a group but then dodgy stuff started happening," she explained.

    "I got an email from Spotify about suspicious activity saying someone was trying to log in to my account so I changed my password. This has only happened since I downloaded the app, and when I told my group chat about it, a couple of people also said weird stuff had happened to them so we deleted it and I warned others."

    The woman acknowledges she uses the same password and email across several online services, so was already at relatively high risk.

    Is the app safe then?

    Epic Games insists its customer data is safe and secure.

    "Passwords are kept in a secure database, salted and hashed, in line with best industry practices," says a spokesman.

    And security experts - who are now examining the product in detail - say nothing obvious stands out.

    "The permissions don't ring any privacy alarm bells for me," says Lukas Stefanko from Eset.

    "The app provides video chats with your friends so it is logical that it asks for access to camera, contacts, location, that sort of thing. I haven't f ound any shady misusing of data."

    Some of the apps' functions have caused concern though for another reason - child safety.

    "Although the app is relatively secure as users can create 'rooms' and pick only specific names of the people to talk with, if a child doesn't 'lock' their chat room and choose private settings, others can pop into the video chat," warns the charity Internet Matters.

    "So it's important to show and sit down with your child to switch privacy filters and other controls on when video chatting. This keeps video chats private and secure."

    Monday, March 30, 2020

    Advertising is coming to video games, and the shift could happen sooner than marketers think

    Key stats: Gaming is massive, but advertising in games is not

    More than 164 million people play video games. Reuters/Kai Pfaffenbach

    To be sure, an ad market approaching $4 billion isn't nothing. But consider that overall, the ad business in the US is expected to hit close to $400 billion this year (bearing in mind that some analysts have adjusted their projections downward due to the effects of the coronavirus pandemic).

    And yet, marketers' investment in video games remains laggard — in fact, it is three to four times less than the rapidly contracting newspaper and magazine categories. It also pales in comparison to the $70 billion TV ad marketplace. For a number of reasons, gaming has not been an especially welcome environment for advertisers. For starters, video games were not originally designed to be an ad-supported medium.

    "The gaming industry hasn't done a good job figuring out the ad model," as a leading ad buyer observed. "There are a lot of elements that create challenges for an ad model to evolve easily. At the same time, if we don't figure out how to turn that into an ad medium, we're going to lose consumers."

    Jonathan Stringfield, PhD, VP of global business marketing, measurement, and insights at Activision Blizzard Media and Esports, understands that sentiment. "The opportunity for brands remains so immense," he said. But there were many missteps in the past when it came to ads.

    "Advertisers at large don't understand our space, and we have to meet them more than halfway," Stringfield said.

    Indeed, video game fans increasingly cut across nearly every demographic. Still, brands have been slow to move past their preconceived image of the pimple-faced teen playing video games in his basement.

    "Generally, brands shift budgets where the consumer is, yet gaming has been the biggest laggard due to this persistent perception of who a gamer is," said Ari Lewine, chief strategy officer of the ad tech firm TripleLift. "But the gamer today, it's your mother, your kids, the head of household. Brands have been slow to catch up to that reality," he added.

    There are reasons to believe advertisers are set to give gaming a closer look, however

    An advertisement for Plague Inc. Reuters

    As both the audience for gaming and time spent playing games have continued to swell, ad-supported linear TV viewing has plummeted, particularly among younger consumers. Marketers are desperately seeking alternative means of reaching gamers via media that has mass reach, which would make video games an attractive option. That is, if the video game companies can figure out how to best incorporate more ads in games.

    "Gaming, in all its flavors, is increasingly just another form of video, and we've got to figure out how to respectfully develop a scalable ad model in its various environments," said Adam Gerber, president of global media at the media agency Essence, part of GroupM.

    "There are lots of potential [ad] models," he said. "The key is to make sure we do it right, and in ways that add value, not detract from the experience."

    Several new startups have emerged that are focused on carefully weaving more ads into games, and investors are showing increased interest in the sector.

    Fundamental changes in the gaming industry's business model seem to bode well for advertising

    Electronic Arts' "Madden Football" has traditionally been sold directly to consumers, but that could change. "Madden 20"/Electronic Arts
  • More top-level games are following the free-to-play model popularized by Epic Games' monster hit "Fortnite."
  • Many experts predict that premium video gaming will move beyond consoles like Microsoft's Xbox and Sony's PlayStation to cloud-based subscription services that could be more hospitable to an ad-supported model.
  • Barclays projects that as gaming moves from console-centric to cloud-based, the universe of gaming devices could swell from the current 150 million consoles to five billion devices. In a few years, games are, simply put, going to be everywhere.
  • It's primarily an expansion of the free-to-play model and the potential of the cloud that has many reassessing advertising's role in the medium.

    While mobile games have been available for free for many years now, high-end games — think Electronic Arts' "Madden Football" or Xbox Game Studios' "Halo" — were traditionally sold directly to consumers, carrying few, if any, ads. But as more gamers grow accustomed to playing top-level titles for free via connected TVs, it is likely that TV-like advertising could find its way to gaming.

    "As a company, we've gotten really good at selling a new 'Call of Duty' title for $60 like clockwork every year," said Stringfield, referring to Activision's massively popular title. "But 'Fortnite' is demonstrative of a larger trend in that the way people want to transact with our company is different. So you have to ask, what is the expectation of that player and what types of games do they want? There will always be a world for premium games that you own, but there will be games built on small transactions, and you could see games that are supported by ads."

    Can video games be integrated with the TV ad market?

    Simulmedia's 'Call of Duty' assessment of gamers per hour. Simulmedia

    Over the past nine months, the TV-ad software company Simulmedia has been in conversations with top video game publishers, looking to persuade them to incorporate TV-like ads into free games. The idea is to fuse videogaming with the emerging over the top (OTT) ad market, according to CEO Dave Morgan.

    "We believe this is the next big thing coming to the ad industry," he said. "This is going to be bigger than AVOD [advertising-based video on demand] in the US because you already have massive amounts of usage."

    Morgan cited the huge spike in players of "Fortnite" and EA's "Apex" in February of this year. According to data provided by Nielsen's Gracenote technology, which pulls on-screen viewership from a panel of 4.5 million smart TVs, those games attract daily live audiences comparable to TV.

    Morgan's idea is to begin weaving TV ads — 30 seconds and 15 seconds long — into free games played on large-screen sets and enable advertisers to buy those units much in the same way they buy TV time. That means using Nielsen ratings as currency and keeping ad inventory scarce. Morgan expects the ad offering to be up and running with half a dozen games across multiple publishers by the third quarter of this year.

    "There is a massive demand among brands for this," he said. "We believe this will be a $10 billion marketing category in the US in a few years, and way more globally."

    It's a bullish assessment — and one that depends, of course, on the dominant players in the space getting on board. While it is not a given that publishers will embrace this new world, Morgan insists that consumers who play games will be open.

    "Gamer acceptance is everything," he said, "and that's in our control."

    Gamers have always made brands nervous

    Gamers are viewed as prickly when it comes to their games. iStock / Getty Images Plus

    Acceptance will make or break this category. Traditionally, brands are wary when it comes to advertising during gameplay — the logic being that when people spend $60 on a gaming disc, they don't want to be interrupted by a commercial.

    Gamers are viewed as prickly and highly vocal — whether or not that stereotype actually holds, seeing as gaming now attracts such a large and diverse fan base. Still, marketers are cautious. "Nobody wants their brand getting yelled at on Reddit," as one ad buyer put it.

    "There are no real native ads in games," a top ad executive observed. "It's one thing to have a sign in a Formula One racing game, but any notion of interrupting always causes a cop-out."

    The 'dynamic' hype cycle — and subsequent baggage

    Atari 2 Flashback game. Associated Press

    Those with a long memory may recall a time in the mid-2000s when video-game advertising seemed on the verge of a breakout.

    For decades, video games were the domain of closed systems — you played games on your Atari or Nintendo 64, and while you were playing you were essentially cut off from any brand messaging. But then, makers of consoles enabled gamers to connect their devices to the internet and launched services that are tied to digital media, such as Xbox Live.

    Around that time, a slew of startups arrived on the scene, promising to launch "dynamic" in-game advertising. Companies like Massive (which was eventually acquired by Microsoft), Double Fusion, and IGA Worldwide touted a new era of advertising to gamers, aggressively selling the idea of marketing to players while they're playing live — just like brands do on the web.

    Many of those companies inked exclusive deals with publishers. For example, Ubisoft used Massive to weave product placement via a Sprite vending machine into the shooter game "Sleeper Cell." Similarly, DoubleFusion rendered ads for the current releases of the movie studios on virtual billboards within various racing games.

    In 2005, Massive Inc. was predicting that in-game advertising in the US would reach $2 billion by 2010.

    Such a market never materialized for a couple of reasons:

  • Securing significant inventory in premium games proved to be an ongoing challenge for startups.
  • Dynamic ads were difficult to purchase and challenging to measure.
  • As one ad buyer put it, "Digital wallpaper is still wallpaper, even if you can swap it out."
  • By the early 2010s, Microsoft had shuttered Massive, and DoubleFusion and IGA would soon go out of business. It was the end of the dream (for the time being) of video-game advertising on a massive scale and dashed much of the enthusiasm around the video-game market.

    There are still many ad opportunities in gaming today

    "The Sims" already incorporates ads, such as for Dunkin' Donuts. Gizmodo

    As noted, this is a market that's poised to reach $4 billion. It's just that it's a relatively small, rather static environment.

    The sector is best broken down as follows:

    Bespoke brand integrations. Think product placements for Dunkin' Donuts in EA's "The Sims" or a Doritos halftime show baked into the latest version of a sports game (Snickers and Bose are baked in this year's "Madden," for instance).

    Such ad deals often require a long lead time since messaging must be weaved into the game-development process. And seeing as such integrations are highly customized, only a select group of brands can execute on them.

    Beyond console games, more elaborate integrations in free-to-play games have emerged. In 2018, "Fortnite" rolled out an ambitious marketing campaign for Marvel's "Avengers" franchise, encouraging players to collect items with the aim of becoming the villain Thanos. The game has also enabled players to don virtual Nike sneakers and NFL gear.

    Still, "Fortnite" has not to date carried any traditional ads, i.e. videos and banners. And Epic Games has said it isn't interested in opening up the game to more brands — understandable given that the company brought in $1.8 billion last year solely from the sale of virtual goods in "Fortnite."

    The mobile gaming ad market is robust, but it's a different universe

    The maker of "Candy Crush" has built a standalone media division to bring in top brands. Carlo Allegri/Reuters

    The mobile game advertising market last year was valued at $3 billion by eMarketer, fueled by 16% year-over-year growth. It's a healthy business to be sure, but industry insiders point out that it is one overwhelmingly dominated by companies — mostly other game developers — that buy ads to encourage consumers to download their apps.

    These mobile in-game ads are typically purchased using programmatic tools and software, and pricing can be competitive, with mobile game giants like Scopely aggressively using data and targeting to acquire new game installs.

    This is not traditionally the domain of large TV advertisers, though some brands have experimented with using rewarded video (if a user is willing to watch a brief McDonald's ad, for example, they might earn more game currency).

    Activision Blizzard is actively trying to change that. The maker of "Candy Crush" has built a standalone media division aiming to bring top brands into the space.

    "IT has had a low-quality, spammy feel, where marketers have said, 'I don't want my ultra-premium brand next to that,'" Stringfield pointed out.

    Activision Blizzard has made a big statement by releasing a free mobile version of its hit franchise "Call of Duty" featuring big-name advertisers.

    "Realistically, we are trying to bring premium back into the mobile space," Stringfield said. "Now is the time to do it."

    Wait, what about esports?

    Esports remains very separate from normal gaming. Reuters

    It's true that interest in professional video game playing in many forms has exploded over the past several years. Thanks to the growth of live streaming video game-playing platforms such as Twitch and YouTube, a generation of star talent has emerged who are, in certain circles, as popular as any athlete.

    Yet to date, esports has been a highly fragmented world, colored by a multitude of leagues, each dedicated to a particular game.

    Starting in 2018, the Overwatch League has attempted to bring some semblance of order to this universe by adopting a more professional sports-like structure, with regional franchises, a predictable season, and a TV contract. There are signs of it breaking through the sports consciousness.

    Still, esports remains a niche at the moment.

    According to the Consumer Electronics Association, 8% of sports watchers claim to be esports fans, while just 9% of gamers make the same claim. That's not exactly the NFL.

    On the ad front, esports share many characteristics with Nascar — brands can sponsor teams, individuals, and tournaments. TV ad spending is still limited. "This tends to be much more of a strategic buy, not something most brands will want to run consistently," said one buyer.

    At least in 2020.

    This year, ad spending on esports in the US will surge 25% to $214 million, eMarketer projects — a solid figure, but tiny in the scheme of things.

    It's also worth noting that like most other sports, the esports category has been forced to severely cut back on live events due to the coronavirus pandemic. Business Insider reported that the category may lose millions this year.

    The gaming workaround: Twitch and YouTube

    Twitch. Reuters

    Given that advertising within video games as they are being played is complicated and that it's seen by many as potentially alienating gamers, many marketers ask: Why bother? Especially since brands can reach gamers or gaming fans rather easily by running ads on YouTube and Twitch.

    It's a reasonable point. Twitch, boasting millions of consumers watching professional gamers, influencers, or amateurs, is a platform where marketers can run traditional video ads or pay for product mentions. Its audience has grown 10% since the coronavirus outbreak and subsequent mass quarantining, reported The Verge. Though according to The Information, Twitch was projected to pull in $300 million in ad revenue in 2019, and was still struggling to find traction among big brands.

    YouTube also features an abundance of gaming content, including esports talent and instructional videos by gaming personalities.

    According to SuperData, the audience for gaming video content grew 5% in 2019, landing at 944 million viewers worldwide. "Overall, when it comes to gaming, people are watching as much as they are playing," noted Dario Raciti, US Director of Zero Code, a division of media agency OMD.

    Raciti said he's recently steered many marketers away from big in-game brand integrations and toward branded videos produced by prominent gamers.

    "In the past few years, we've seen a pretty dramatic shift away from the older in-game model toward advertisers working primarily with game influencers, esports teams, and leagues," he said.

    As Raciti sees it, game creators offer more flexibility for brands, not to mention a potent fan base. And because these creators make entertaining videos for a living, they "are often much better at telling brand stories," he said. "With the right partner, we see branded content generating millions of views in just a few days."

    Meanwhile, a new collection of startups is looking to revive dynamic in-game ads

    Some companies have in-game ads already.

    Last August, in a possible sign that in-game ad tech may be due for a revival, the Israeli startup Anzu raised $6.5 million from investors, including the powerful agency holding company WPP. Like the dynamic in-game ad firms from the mid-2000s, Anzu serves digital signage into games as they are being played, as well as interactive ads.

    According to Natalia Vasilyeva, vice president of marketing at Anzu, the company has learned from some of the missteps of the past and has focused on making the medium as attractive as possible for advertisers. That means employing standard IAB ad units, programmatic buying and selling tools, and multiple third-party data auditors to give marketers the confidence that their campaigns are being delivered in full and being seen by real people.

    "We're trying to give advertisers everything they are used to in digital advertising," she said. "We know we need to prove the medium's value."

    Similarly, the UK-based startup Bidstack is looking to deliver immersive ads in live games. The company is being advised by Jonathan Epstein, who, a decade ago, was CEO of DoubleFusion.

    Epstein thinks the sector is much better positioned for in-game advertising than during the previous hype cycle. For one, mobile games were barely a factor a decade ago, and programmatic advertising was in its infancy. And not insignificantly, far more people are playing games now than they were then.

    "Back then, the market was smaller and the business model was off," as Epstein put it.

    He's betting that things are quite different this time around.

    The ad agency structural challenge remains

    Most brands don't have a gaming ad budget. David McNew/Getty Images

    A major obstacle to the growth of in-game advertising continues to be scale, or lack thereof.

    Despite its eroding audience, TV remains advertisers' go-to mass-reach medium. At the same time, most brands do not have a set budget for gaming, while ad agencies don't traditionally have teams dedicated to the sector.

    Gaming may come out of experimental budgets, for example — or in the case of Twitch, digital video or programmatic. And when it comes to larger, more integrated packages, those deals may come straight from the brands themselves, or their business development teams.

    It all makes it tougher on the companies trying to sell the gaming audience to brands. Perhaps that's the reason one top ad buyer said he rarely hears from his clients about an interest in gaming.

    "There is not a lot of agency talent that is versed in how to do this across the gaming ecosystem," said Raciti. "There is not enough talent to meet brand demand."

    The publisher conundrum

    The maker of "Fortnite" said it wasn't a fan of interruptive ads. Reuters

    If in-game advertising is truly set to expand in a meaningful way, one thing must happen: The companies that make the games need to play ball. And while publishers like EA and Activision have standalone ad teams, not every game producer has the same level of interest in advertising.

    Indeed, it's telling that "Fortnite" has taken such a measured approach to ads. Given its massive audience and the fact that its product is free, it would seem perfectly positioned for more ad business.

    Alas, Epic Games has repeatedly said it is not inclined to introduce interruptive ads. Even though the company sells virtual goods to only a certain percentage of its players, it still managed to rake in nearly $2 billion from the last year.

    "I'm not sure if I see a big market for TV ads in free games," said Raciti.

    After all, the publishers are already making so much money.

    And that's a hard point to argue.

    EA took in nearly $5 billion in revenue last year, according to JPMorgan Chase, while Activision Blizzard's haul was $6.4 billion. And Barclays estimates that in-game revenue — which boasts better profit margins than game hardware — will cross the 50% threshold of total console revenue by 2024.

    But even a few hundred million in advertising may be small potatoes to these companies.

    That said, video gaming insiders point to a growing number of free titles that are a middle ground between the most premium — and expensive — console games and popular casual games like "Candy Crush." For example, Activision's free version of "Call of Duty," "Call of Duty: Warzone," amassed 30 million players in just two weeks. Similarly, EA's "Apex Legends" drew 25 million players just weeks after it launched.

    "The audience for free-to-play high-def games is exploding," said a top gaming executive. "Since only a small fraction of those players actually spend in the games, advertising should be an appealing way for publishers to monetize the full player base. It's a matter of who is willing to go first."

    The tech giants are coming to gaming — and they get ads

    Google's Stadia entered the game space last year. Google

    One factor that could really accelerate advertising in the video game space is the entry of new players who are far more inclined to build ad-supported businesses. First and foremost is Google, which last year rolled out (to subpar reviews) its very-much-in-beta gaming platform Stadia.

    At the same time, Microsoft is looking to take on Twitch with its alternative streaming platform Mixer, while Snapchat is emerging as a gaming platform, and Facebook and Amazon are aggressively entering the sector as well. None of those companies has announced a major in-game ad initiative, but it's not difficult to imagine any of them doing so.

    "Major ad-supported companies are actively invested in gaming," said Kieley Taylor, GroupM's global head of social. "I anticipate they'll have success in cross-selling gaming opportunities to their current customer bases. The game industry will then overall gain more access to brands and budgets."

    Measurement will be key

    Video games and TV require different ad techniques. Shutterstock/Blackregis

    If gaming is going to get anywhere as a mainstream ad medium — let alone one that can be in the same conversation as TV — it must first coalesce around a common form of measurement, one that plugs into existing advertiser methodologies rather than asking brands to wrap their heads around something new.

    "With so many different entities participating in an evolving marketplace, common definitions, especially with respect to measurement, are few and far between," said Taylor. "Apples-to-apples measurement with TV is a challenge."

    It is for that reason that Morgan is actively working to have Nielsen participate in his TV-esque ad rollout. "We'll have panel-based measurement for game ads using the same research companies that are already widely accepted in the TV world," he said.

    The surge in gaming activity during the coronavirus crisis could lead brands to give the medium a second look

    With Americans social distancing, video games have surged in popularity. LightField Studios/Shutterstock

    As millions of Americans find themselves practicing social distancing and stuck at home for the duration, it's little surprise that the number of people playing video games has spiked. Gaming usage on Verizon's network soared a whopping 75% during the early weeks of self-quarantining across the US, according to The Hollywood Reporter.

    Gaming isn't the only media sector to see its audience swell amid the health crisis. TV viewership is also up, even though on a typical week more Americans continue their shift away from ad-supported linear TV and toward ad-free streaming services like Netflix and Amazon Prime.

    Then there's the fact that games like "Fortnite," "Roblox," and "Call of Duty" have emerged in recent years not just as popular games, but as full-on social networks. (Analyst and venture capitalist Matthew Ball has written extensively on the subject.)

    The value of games as social platforms has never been as apparent as during social distancing. "You could argue that gaming is more immersive than TV these days," said Lewine.

    Whether the extended period of self-quarantining and the renewed spotlight on gaming will have more marketers reconsidering the power of the medium remains to be seen. Much will depend on the state of the US economy moving forward.

    "I'd say prior to this year, gaming for brands has been mostly an interesting niche — there was only so much ad inventory that's desirable," said Brian Wieser, GroupM's global president of business intelligence. "It's hard to know right now whether brands are going to be interested in trying new things, especially if we see 20% cuts in ad spending or something on that level."

    While companies like Simulmedia can successfully bridge TV advertising and gaming, everything is on the table.

    "The idea of pushing into OTT is interesting given what's happening with the linear TV audience," said Wieser. "But you have to figure out how to introduce ads to this medium. It's hard to go backward, but you could argue that if you launched Pac-Man today, maybe you'd do it with ads in between levels and people would be OK with that. Right now, you have to change people's expectations."

    And that could change the whole game.

    Sunday, March 29, 2020

    Fortnite Creator Champions New Paradigm for Publishing Games

    Three years ago, Epic Games, a privately owned videogame developer with backing from established entertainment giants Disney and Tencent, shook up the videogame industry when it introduced the free-to-play Fortnite Battle Royale. Fortnite was a $1 billion in sales in less than a year, and rival game publishers such as Activision and Electronic Arts began to take notice when Fortnite started eating into their revenue streams.

    Now, Epic is going a step further toward disrupting the games industry.  

    Couple cheering and excited as they play a game on a cellphone

    Image source: Getty Images.

    On Thursday, Epic announced it will spearhead a new "developer/publisher model" that "fundamentally changes" how games are created, published, sold ... and profited from.

    Teaming up with developers genDESIGN, maker of The Last Guardian and The Last Colossus, Playdead (Inside, Limbo), and Remedy Entertainment (Control, Max Payne) , Epic will serve as the publisher of its partners' games. In doing so, however, Epic will guarantee that the developers retain "100% of all intellectual property and full creative control of their work."

    Utilizing the financial heft it's gained from the success of Fortnite, Epic "will cover up to 100% of development costs, from developer salaries to go-to-market expenses such as QA, localization, marketing, and all publishing costs." Then, after a game has been published and gone to market, Epic will pay itself back for these development costs. Whatever profits come in on top of that will be split 50/50 with the game's developer.

    As Epic founder and CEO Tim Sweeney explained: "We're building the publishing model we always wanted for ourselves when we worked with publishers."

    And it's not done yet. "Additional information, development partners, and games will be announced in the coming months," said Epic.