Blockchain and video games : a happy marriage ?

What if blo­ck­chain tech­no­lo­gy were to pro­found­ly change the video game land­scape through an unpre­ce­den­ted trans­fer of owner­ship in the form of non-fun­gible tokens (NFTs)? The mar­ket for ava­tars and non-fun­gible objects has alrea­dy ente­red the vir­tual game world in a hapha­zard and often expe­ri­men­tal way. Stu­dios and publi­shers such as Ubi­soft, through its Stra­te­gic Inno­va­tion Lab, are now loo­king at this new model that the video game indus­try could popu­la­rise worldwide.

What is the mis­sion of Ubisoft’s Stra­te­gic Inno­va­tion Lab ?

Nico­las Pouard. To anti­ci­pate the future of the video game indus­try and help Ubi­soft pre­pare for it. As such, we’ve crea­ted a fore­sight team that conducts fair­ly stan­dard stu­dies to pro­ject our­selves into the future based on trends and weak signals. And we try to trans­late this pros­pec­tive research into concrete and prac­ti­cal terms.

First­ly, we have a pro­to­ty­ping team that gets its hands dir­ty. For example, very ear­ly on we wor­ked very ear­ly on sub­jects such as aug­men­ted rea­li­ty (AR) or machine lear­ning algo­rithms and, for the past four years, we have been wor­king on blo­ck­chain. At the time, it must be said that there were rela­ti­ve­ly few appli­ca­tions, yet we were able to put toge­ther a small team and work on this sub­ject over a long period.

The second path cho­sen by the Ubi­soft Lab is a star­tup incu­ba­tor that allows us to work direct­ly with entre­pre­neurs and to help them unders­tand the tech­no­lo­gi­cal chal­lenges they face. And of course, the new mar­kets they are trying to create. In 2019, we selec­ted the star­tup Sorare as part of Ubisoft’s Entre­pre­neurs Lab pro­gramme. A few days ago, Sorare announ­ced that they had rai­sed €580m of invest­ment, the big­gest fun­drai­sing pro­ject of the whole of French Tech. Indi­rect­ly, it’s quite flattering.

What link do you make bet­ween blo­ck­chain tech­no­lo­gy and video games ?

Four years ago, it was the arri­val of one of the most impor­tant blo­ck­chains, Ethe­reum, which real­ly put for­ward the concept of Smart Contract, or decen­tra­li­sed auto­ma­tion. At the time, there was a lot of talk about a revo­lu­tion, all indus­tries inclu­ded. Obvious­ly, we won­de­red what this meant for video games and for gamers in par­ti­cu­lar. There was talk of more control over game items for players or sub­scri­bers, their vir­tual items, and skins, that it would give new power to com­mu­ni­ties. We’ve been tal­king about guilds or teams for a long time in video games. Again, there was a sense of a new era for these com­mu­ni­ties to move towards decen­tra­li­sed auto­no­mous orga­ni­sa­tions, enti­ties that would manage them­selves through code, etc. To be honest, there was also a sense of a new era for these com­mu­ni­ties, yet there was also a lot of unknowns.

Then we met B2Expand in Lyon, which was one of the first star­tups in the world to work on the use of blo­ck­chain in video games. As we were set­ting up our incu­ba­tor at the time, we brought them in. We were able to see first-hand what it meant for video games, i.e. increa­sed user control over game objects. And here, NFTs, or non-fun­gible tokens, are real­ly the heart of the pro­po­sal. These digi­tal assets are issued and exchan­geable on a blo­ck­chain, but they are unique and non-divi­sible. One NFT will always be dif­ferent from ano­ther NFT. It is a proof of owner­ship of sorts.

Today, if you buy a car in the video game The Crew or a skin in Rain­bow Six Extrac­tion, you pay for access. The exis­ting tech­no­lo­gi­cal limi­ta­tions mean that the publi­sher retains, by default, all control over this content. If there is no imme­diate need or demand from users for more control, there has been a rare situa­tion where there is a sense of injus­tice that a publi­sher can change the rules of the game and alter the power of an item for example.

Blo­ck­chain tech­no­lo­gy has a very expe­ri­men­tal dimen­sion because, sud­den­ly, the eco­no­my of a video game can be shif­ted more to the players’ side and not enclo­sed in the publisher’s eco­sys­tem alone. We, as publi­shers, are still won­de­ring how to make this acces­sible to go in the direc­tion of the player. The tech­no­lo­gy is quite imma­ture in some respects.

So, it’s all about reliability ?

For Ubi­soft, this relia­bi­li­ty requi­re­ment is essen­tial, pri­mor­dial. And then, we must see to what extent this tech­no­lo­gy is dis­rup­tive or not in the pro­duc­tion pro­cess. If it doesn’t trans­form pro­duc­tion methods, it can be inte­gra­ted qui­ck­ly. If it trans­forms the repre­sen­ta­tions we have of how to make a game, that poses more pro­blems. And so, typi­cal­ly, blo­ck­chain is a point of fric­tion on pro­jects alrea­dy in pro­duc­tion. But if we start ear­ly, it allows us to have a whole phase of expe­ri­men­ta­tion to check the relia­bi­li­ty of the tech­no­lo­gy to deve­lop a dis­course which allows us to inte­grate these new ways of doing things into pro­duc­tion. First, howe­ver, we must demons­trate the relia­bi­li­ty of the NFT and the bene­fits for the players. Other­wise, the pro­duc­tion teams will not adhere.

Can video games popu­la­rise NFT ?

We are players that people trust. We have this level of repu­ta­tion which means that, if tomor­row we pro­pose to dis­tri­bute NFT in our games, people can come with confi­dence. In the long run, and if this move­ment is glo­bal, it could make blo­ck­chain invi­sible in a way, redu­cing it to an infra­struc­ture tech­no­lo­gy. It’s the use that will come first. And the pri­ma­ry use that we see today is indeed this trans­fer of owner­ship for our players. Our main chal­lenge remains the same, wha­te­ver the tech­no­lo­gy : only imple­ment an inno­va­tion if it brings mea­ning and added value to the players and their gaming experience.