🎮 Visible Hands: Not All Fun and Games?
A closer look at the video game industry -- its recent growth, the fight against Big Tech, and the many internal problems it faces.
Quarantined folks have turned en masse to video games for entertainment during COVID-19. Meanwhile, gaming companies are trying to take on Big Tech for their business practices, but should they also be looking internally at their own practices?
Gaming is at an all-time high. The video game market is forecasted to surpass $200 billion by the end of 2023, which is about twice the size of the film industry. According to Nielsen, 82% of global consumers played video games and watched video game content during the height of the pandemic lockdowns. Twitch, a live-streaming gaming platform and subsidiary of Amazon, saw a 101% year-over-year increase in viewership this spring with 1.6 billion hours watched per month. Unity, the development platform behind half of all games, saw 95 million new gamers in the spring (almost double their pre-COVID amount), and is still averaging over 88 million new players weekly.
In recent weeks, Epic Games, mastermind behind the video game sensation Fortnite, sued Apple and Google for removing it from app stores. To circumvent the 30% intermediary fee that Apple and Google charge in their app stores, Epic Games recently included an option for players to pay them directly in their in-game marketplace. After being kicked off these app stores, the company almost immediately filed a lawsuit against this “anticompetitive behavior” and launched a publicity campaign against the tech giants. With Fortnite Season 4 launching last Thursday, players on iOS or macOS were limited to the game’s older version and left unable to play with non-Apple platform users.
But before we applaud Epic Games for sticking it to monopolistic Big Tech, let’s not forget the many problems plaguing the gaming industry. To start, the employment practices of gaming companies have raised eyebrows. Although the industry employs more than 220,000 people worldwide, thousands of freelancers create the script and art, and armies of contractors help in game development. According to a 2016 survey, 34% of video game developers don’t work for a company -- a recent phenomenon to manage headcount costs for an industry that faces choppy launch-dependent workflows. As employees of “temp” agencies that contract with the gaming companies, these contractors often have no paid vacation or benefits, lower pay, exclusion from video game credits, and limited options for career progression. According to Bloomberg, “at one studio, a contractor says they were given cheaper, less comfortable chairs.”
And the gaming and esports industry still battles pervasive racism and misogyny. From having only two black women fighting game characters among the countless fighting games, to the stark lack of racial diversity in worldwide game developers (81% identify as White, 7% as Latinx, 2% as Black), racial bias is often cemented in the story lines and games. Since June, hundreds of people in the gaming industry have gone public with allegations of gender-based discrimination, harassment and sexual assault (you can find the compiled list of allegations in this Google Sheet). As Brooke Thorne, a streamer and gamer, noted, “When it’s one call-out, it’s a problem with a person. When there’s a ton of call-outs, it’s a problem with the industry.”
As a consumer:
Consider supporting games featuring diverse character casts, such as The Last of Us II or DecoyGames, Gameheads, Waking Oni Games, and Jesse Wright.
According to Emma Kinema, founder of Game Workers Unite, “If you’re a video-game player, learn about working conditions and learn about the grassroots movements to improve them, and then spread that in your communities and get people to talk about it and make it a part of how they approach the medium.”
As an employee:
The Communications Workers of America (one of the country’s largest unions) is seeking to organize workers at gaming companies. Their Campaign to Organize Digital Employees has also brought Game Workers Unite into their efforts. “Companies in the technology and game industries have gotten away with avoiding accountability for far too long…”
The video game industry has turnover rates up to 15.5%. Check out this LinkedIn article about how to avoid high turnover, including more employee engagement, internal mobility, and investing in employee development.
As an investor:
Investor dollars are flowing into gaming and esports. BITKRAFT Ventures just raised a $165 million fund focused on this space.
In thinking about how to include more diverse characters and stories into games, NYU Professor Robert Yang noted, the gaming industry has “to build the arts-and-culture platforms and the festival circuits [like the film industry]...We have to convince funding bodies and governments that games are worth more than their sales numbers.”
As a citizen:
Think video games are apolitical? Think again: “Its biggest products include military shooters with names like Infinite Warfare, the edgelord nihilism of Grand Theft Auto, zero-sum battles for resources like Fortnite, and glorified advertisements for men’s sports cartels that enrich oligarch owners and shoe company CEOs.”
Big Oil Is in Trouble. Its Plan: Flood Africa With Plastic: “An industry group representing the world’s largest chemical makers and fossil fuel companies is lobbying to influence United States trade negotiations with Kenya, one of Africa’s biggest economies, to reverse its strict limits on plastics — including a tough plastic-bag ban.”
The Loan Company That Sued Thousands of Low-Income Latinos During the Pandemic: “Our reporting revealed...that [Oportun Inc.] draws clients in by depicting itself as a benefactor of the Latino immigrant community yet charges high interest rates, keeps customers like Solis on the hook with repeated refinancing and routinely uses lawsuits to intimidate delinquent borrowers into paying again.”
Most Americans Believe the Covid-19 Vaccine Approval Process is Driven by Politics, Not Science: “The sentiment underscores rising speculation that President Trump may pressure the Food and Drug Administration to approve or authorize emergency use of at least one Covid-19 vaccine prior to the Nov. 3 election, but before testing has been fully completed.”
Investing in Social Good Is Finally Becoming Profitable: “‘I am hopeful that the tide is turning, but I’m also worried that there is a lot of greenwashing going on,’ [Joshua Humphreys, president and senior fellow at the Croatan Institute] said, using the term for when asset managers simply tick the boxes that make them look as if they care about impact investments but don’t really put in the work.”
Stakeholder Capitalism: Not If But When: “There is too much focus on the "if and what," and not enough on the "when and how to drive this forward." We should be thinking about the timescale for change, key factors that will influence the transition and how boards can help accelerate the shift.”
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