Verizon Gets in the Game

If three instances of a phenomenon equals a trend, then the unstoppable trend of the PC game business today is broadband distribution — from Valve’s Steam and distribution of episodic gaming, to niche/indy game downloads through Manifesto, to the recent entrance of telecom colossus Verizon into this space, with their Games on Demand service, and their PlayLinc gamer network (in partnership with Super Computer International.)
It’s a long time in coming, but it’s as if the industry suddenly scratched its collective head a few months ago and asked, “Why are we spending so much money and effort burning our content onto plastic disks and cramming them into cardboard boxes and begging capricious-but-powerful retail giants to carry them on their shelves?” Not to mention trying to convince game buyers to spend an hour or two driving to a store, when more and more of them can often just download the exact same game in the same amount of time.

Verizon is among the latest and largest to capitalize on the logic of broadband-based game distribution, which probably makes that business model’s ascendance unstoppable. The games-on-demand model is also a way for Verizon to coax subscribers onto its fiber network. All that in mind, I recently fired off some questions to Jason Henderson, Verizon’s Games Product Manager with Verizon, to get his take on the company’s entrance onto the playing field.
Tell me a bit about Games on Demand.
Jason Henderson: [It’s] like Netflix; I pay a flat fee and get unlimited access to PC titles. The Unlimited package ($14.99/mo) has all genres, all kinds, so there’s everything from Unreal Tournament to Bejeweled, including all the kid titles– it’s the all-you-can-eat package. Family Place ($7.99/mo) is a “safe garden” of only kid-appropriate games and games rated E… then there’s Quick Pack, $4.99/mo for unlimited access to the kinds of casual, lunch-break games. Games on Demand is a rental model, for those who prefer that over purchasing, as at Verizon Arcade, where we sell casual games.

Give me some background on the infrastructure Playlinc uses, in terms of bandwidth, concurrency, and server hardware.
JH: PlayLinc uses a proprietary server-launching technology that allows us to create thousands of dynamic game instances on one computer at a time. It’s a new, different model from the most common model, where static servers go up and take network resources constantly.
Is there any particular advantage to having Verizon broadband before getting PlayLinc, or vice versa?

JH: For accessing hosted servers and playing multiplayer games, you should have a great experience even if you access it by the last mile from another ISP. So you can use PlayLinc and get your broadband from Time Warner. In fact, we want cable users.
But if you’re using Verizon, you’ll be closer to the network so you may have less hops, and we pride ourselves on speed and reliability, which are key requirements for gamers.
Certainly if you have FiOS there’s a benefit in hosting games. Hosting a game relies on upload speeds– how quickly I can send information back to my players. So if I’m hosting a PC or console game on my own machine through GAN, which allows me to have a LAN party across the Net, the much-higher upload speeds on FiOS (2mbps, typically, compared to 720kbps) will create a better gaming experience.
What demographics and marketing research did you do, in deciding game services would be economically viable and technically feasible for Verizon?
JH: We took a very deep dive into market research from analysts like Parks, Yankee, and IDC. What we found was that gaming is a leading activity for over 75% of broadband users, and since we have over six million DSL subscribers, we had to develop a portfolio of services built for the preferred product models of each. So we have casual games for the 143 million or so casual gamers, Games on Demand for family gamers, and PlayLinc for the 16 million or so “core” gamers.