Bridging The Web3 Game Distribution Gap

Distribution of Web3 games represents an unsolved challenge gating widespread adoption of blockchain technology. Based on conversations with dozens of Web3 developers, we have found that there is a general need to think differently in order to evade legacy gatekeepers preventing scale.

This article discusses how games have historically been distributed in the Web2 era and some of the emerging avenues for distribution in Web3 today.

How Distribution Falls Flat

In the prior era of mobile and “Web2,” distributing your game was a critical component of success.

The first games to launch on the Apple AppStore, such as iShoot, achieved hundreds of thousands of dollars in sales per month, accelerated by the visibility given to them by Apple. Likewise, games distributed by Valve’s popular Steam platform, Facebook (now Meta), the PlayStation and Epic receive significant reach advantages.

However, in the Web3 era, developers are finding that tech industry titans such as Apple, Google, Valve, Microsoft, Sony and Epic are increasingly posing a threat to their businesses. As a result, introducing and marketing games which involve the use of “questionably regulated” features, such as tokens and NFTs remains a hazardous proposition, subject to censorship and demonetization.

Given that cryptocurrencies and NFT assets represent “real dollar value” assets which are transferable and swappable, it is understandable that global enterprises, who have to comply with international laws focused on gambling and money transmission, may pose a threat.

For example, Apple recently blocked CoinBase from enabling users to send NFTs by requiring a 30% tax on gas fees. These types of decision by platform owners threaten the promise of Web3.

The good news is that Web3 may offer new avenues for distribution which may help circumnavigate these issues.

New Ways To Distribute Web3 Games

Based on our research, we are seeing a few potential solutions emerging. Here are a few options which we might see taking shape in the future to solve the Web3 gaming distribution challenge:

Option 1: Distribute the games yourself, build an audience and community and scale your own ecosystem.

AKA “Go Browser Native.” Many developers are choosing to build web-only and then use clever marketing techniques such as giving away “packs” of in-game NFTs which have real value, circumventing the need for App Stores.

Option 2: Design your game to have a swappable “Back-end”

Another approach is to build a game which can operate using Web3 or fake money, depending on how it is distributed.

In this world, clever game developers will abstract their game economy such that the front-end experience of their game is transportable. Building games in this fashion allows Web3 game developers to tap into multiple platforms, provided they modify those game builders to follow the rules on a per platform basis.

Option 3: Leveraging new Web3-native structures such as ENS Domains or similar

Web3 offers a variety of new methods to achieve distribution. For example, ENS domains (Ethereum Name Service) enables players to create personalized “in-boxes” representing effective mailing addresses for their wallets. These types of projects, along with many others, offer completely new Web3-native methodologies to marketing to game developers. A Web3 game developer could “mail” free NFTs or in-game assets to large lists of developers (in the place of advertisements) to attempt to persuade these developers to try their particular game.

Option 4: Leveraging Web3 Wallets as a potential new backbone for distribution

A further element of Web3 is the critically important role of wallets. In Web3, wallets form the backbone of a user’s storage of assets and their identity. We are seeing signs in the market that wallets may involve into a place where gamers can not only host their funds, but also interact with others and even launch games and other applications. MetaMask, Game7 and Leap Wallet are all pursuing these avenues.

We also believe that wallet-native distribution may alter the way in which advertising works when it comes to Web3 gaming.

Option 5: Leverage Web3-native Social Networks

Much has been written and said about the topic of Economic Sustainability in Web3 games. To summarize: Once you convince gamers to bring their funds to your game, how do you keep players engaged?

The answer may very well take the form of emerging Web3 Social Networks such as Lens Protocol. The foundation of economic sustainability will likely require giving gamers reasons to come back on a daily basis, something which social networks like Twitter have achieved very well.

If Lens Protocol and other similar networks manage to achieve network scaling effects; they may evolve rapidly into the leading way to market and distribute Web3 games.

How Web3 Impacts Game User Acquisition and Advertising

In the existing mobile and social game industry, builders have created finely tuned funnels to properly value “lifetime value” of a user in order to be able to properly price user acquisition. If we know an average user for a game is worth $40, in theory the game developer is willing to pay up to $40 to acquire that user for their game. This has been a typical feature of how many mobile games think about user acquisition.

In Web2, much of this expense tends to go towards the advertiser. For example, a game developer might spend money to place in-game ads in competitive games seeking to transfer that gamer to their own game.

In Web3, the advertiser may potentially become disintermediated. Rather than spending money on the advertiser to serve the ad, the developer may directly pay or compensate the target game by air-dropping in-game items or currency worth real money with the hopes that this particular gamer will then play their game.

This disintermediation represents an exciting new way to distribute Web3 games via wallets.

Beware Vampire Attacks

It also represents a threat. We are increasingly hearing concerns from game developers that their competitors may pursue “Vampire Attacks” on their users, whose wallets will often be publicly discoverable via a variety of means.

Likewise, a few enterprising projects may embrace vampire attacks as a core aspect of their marketing.

EPNS

Still another fascinating technology is EPNS (Ethereum Push Notification Service), offering to fill a similar niche as Twilio (except for on the blockchain). EPNS has the potential to unlock completely new vectors for direct advertising and audience acquisition.

Having blockchain-native methods for sending and receiving messages would be a natural fit for Web3 gaming.

Closing Thoughts

This article has discussed the historical distribution of games, potential distribution avenues in Web3, and the potential for Web3 game distribution in the future. It has also provided insights and trends for Web3 game developers to consider.

At Saga, we have founded our Innovator Program specifically to help developers form a community and share solutions to overcome common challenges faced by Web3 game builders. We believe that once Web3 Game Distribution is solved, we will see mass adoption of blockchain technology by gamers worldwide.