VirtualWorldsNews Interview: Raph Koster, Areae President and Founder

The VirtualWorldsNews weekly interview feature has been on a bit of a break. We last spoke with Kaneva CEO Christopher Klaus about how Kaneva is tying virtual worlds to social networks. Now we're excited to launch back in with a lengthy discussion with Raph Koster, President and Founder of Areae, the makers of Metaplace. In case you missed the big announcement, Metaplace, a Web-based platform and network for virtual worlds and virtual world developement, is one of the most buzzed about virtual worlds projects in development. We spoke with Koster about his plans for Metaplace, microtransactions as a revenue model, the distinction that's made between massively multiplayer online games (MMOGs) and virtual worlds, and more. "Overall, this is the most fun I've ever had in my working life," said Koster. "So I'm incredibly excited about what we're doing, but also about what's going on in the space. It's an exciting time. I worry about all my friends who are still making the big triple-A MMOs. I don't think they're going away, but their potential role is diminished." Koster will be speaking at the Virtual Worlds Conference and Expo on October 10-11, 2007 in San Jose.

Virtual Worlds News: It seems like there are a lot of people that still don't really understand what Metaplace does. Can you give us some background on how you envision Metaplace?

Raph Koster: I don't really need to envision it. I get to play with it in house, so it's hard for me to understand what people don't get at this point. Basically, it's an MMO platform designed for end users, designed to be client agnostic. It's meant to be really easy to use and as flexible as we can make it. The guiding principle is that it works the way the Web does. We've said that from the very beginning. That was up on the Areae company website, but people seem to still not quite get that we mean that very, very literally. There is a markup language that is an open standard that anyone can write clients to. Because it is an open standard, there is no assumption about what the client is built into the games. There is an open server that can be made different with scripting. There are style sheets and modules that are a lot like, well, style sheets and modules. It's easy for people to get something together by inheriting other people's work. And there is a portal site that is a lot like Google or Yahoo or YouTube. It works like the Web does.

VWN: Does that mean it runs a browser plugin?

RK: We have a Flash client. You don't need to install anything. Technically Flash is a plugin, but everybody has it. The Flash client is only about 30k. We've embedded it in Facebook. We've embedded it in Myspace. You can put it anywhere. Now, we've actually written three clients. We have internal tools clients. We have a prototype client. We've written clients in C++ and Basic just because we can. That's the whole point. It may be that someone will write a client that requires a plugin or requires a download, and that's great.

We figure the Flash client will be the commonest client. Flash is ways away from being able to do good 3D. The system's [Metaplace's] architected to support 3D, but since we picked Flash, we don't have the 3D rendering. If someone makes a downloadable client that does it, that's great. The way it works is that it's up to the client writer. A full 3D environment is possible.

VWN: So it's mostly in the sort of Habbo-style 2D?

RK: We have folks in the office trying to do a Zelda style. We have people making platformers. We have the Habbo style thing, but we also have the Ultima Online height field thing working the Flash client. I guess the answer is that it really does any of those things. That would be fine.

VWN: You've said you're working on your next MMO in Metaplace and that you're also developing a prototype world to show off. Can you talk any more about those?

RK: We haven't started talking yet about the game that I'll be making. We want that game to be something that leverages the strength of the platform and that lots of people can play. It should work within the Flash client.

VWN: How many people can you support in a world?

RK: We haven't really finished that testing, but it should be in the thousands. It's heavily dependent on how intensive your scripts are. If you have a simple chat world without physics or even moving, you could support quite a lot. If you're doing full physics and collisions, the number could be lower. We also support instancing. We can instance worlds and we even have a spectator kind of mode where the server can be a client to another server and you can see what's going on.

VWN: Do you have a favorite approach?

RK: I still have a lot of favor for isometric back from the Ultima Online days. I've also been doing a lot of puzzle game design, and that's straight overhead.

VWN: You've mentioned that people will need to enter a tax ID  to engage in commerce. Does that mean you're focusing on the US?

RK: A lot of people have read too much into the tax ID comment. Basically what it boils down to is that we'll comply with laws. That means that I'm sure European players will probably have to pay VAT. In the US, if you're deriving income and we're cutting you a check, we have to know your tax ID number to report it. I think the days of Wild-West, seat-of-the-pants ecommerce has gone away. The governments are watching. I wouldn't try it any other way.

VWN: It seems like you're one of the first virtual worlds to really incorporate tax. How are you approaching it? Since the US hasn't really stepped up to start collecting taxes on virtual worlds, do you just feel like you're getting ahead of a coming law?

RK: Our model is literally off of Google AdSense and Amazon associates. Google AdSense needs your ID. Amazon just gives you a gift certificate. But you're running a business, and if you cashed out, they'd need the tax ID. Even if Second Life wasn't doing it, the IRS would probably say that anyone making a revenue, should be declaring it. I've been talking to a lot of people and what it boils down to is that it doesn't matter where you make your income.  It's taxable. I don't think I'm getting ahead of the law. It's here.

VWN: You've been an outspoken proponent of microtransactions. I'm thinking of the panel you were on with Erik Bethke at the Austin Game Developers Conference. Why is that?

RK: There's a lot of reason that tiered pricing makes sense. The thing about flat fees is that they're one size fit all. The first people bounce off because they don't think it's worth 10 bucks a month. The second group is willing to pay more. This is their hobby, and on their hobby, people are willing to spend quite a lot. There are people who really only want to pay ten and others who pay fifteen and only use the service for five dollars worth and wind up subsidizing the others. That's the way the business works.

In most service industries, what we see is tiered pricing. It might be premium services or another model, but the common factor is that people who are using the service more pay more. The low end isn't subsidizing the high end, which is great for consumers. The high end is actually paying more, which is great for operators. This is really common, even in subscription based services. If you go look at your cable bill or phone bill, you'll find that. The subscription MMO is kind of an oddity. Tiered pricing has the advantage of covering thee sector really well. Someone who wants to play for free can, someone who wants to pay and play more can as well. It's more equitable.

Is the total net dollars better? It's an open question. You do have all those people playing for free. There's plenty of good money, let's put it that way. In the West it's been tarred. Marc Jacobs [the VP EA, Studio GM EA Mythic, who was on the AGDC panel] looks at microtransactions as linked to virtual item trade. Those two have nothing to do with each other.

VWN: Why do people view them as linked?

RK: So many of the microtransaction models have been about virtual clothing or whatever. And the first place that people come into contact with it is grey market stuff in World of Warcraft or whatever. A lot of people think that microtransactions necessarily mean the selling of transferable items.  Microtransactions is just a billing model.

VWN: Is that tiered?

RK: Microtransactions usually just mean lots of small purchases or prepurchasing something big, like a block of points, and then deducting from it. That's just a billing model. Whether what you're buying is virtual services or assets, it could be any number of things.

VWN: I remember at the Virtual Goods Summit over the summer,  David Wallerstein from Tencent made the point that in the West, people expect things to be free online. Do you think that's changing?

RK: The kinds of things that we're thinking of charging for are things that people expect to be charged for. If you make a really big popular world, it's not unusual to charge for the bandwidth. It comes down to the billing model and what you're selling. There is more resistance toward the purchase of virtual hats, but particularly things that are gameplay effecting. That's a cultural difference.

Our virtual currency is a network level currency. It's mostly for network usage. We don't have anything planned for asset sales in a world. The thing we're thinking of are upsell costs for aspects of the service. I'm not a fan of the gameplay-affecting transactions anyway. It is important for the game to have a level playing field.

VWN: As far as gameplay goes, you have a deep background in designing MMOs, but now you're working on something that straddles the fence between MMOs and virtual worlds. How is it working on both sides of the fence? Or do you think there's a difference at all?

RK: There is no fence. I'm annoyed by the co-opting of the term "virtual worlds" to mean "no games." MMOs are just virtual worlds with games in them. "Virtual worlds" is an umbrella term. But I feel like this is a lost battle. It's frustrating for me and a lot of developers because we don't have an umbrella term. Second Life is a virtual world without a game. World of Warcraft is a virtual world with a game. There's really no difference as is evidenced by the fact that you can put games in Second Life and socialize in World of Warcraft.

VWN: Do you feel like that's a new trend, splitting the two?

RK: It's not a new way of looking at things. The use of "virtual world" is a marketing term to differentiate from gaming. This is not the first time it happened. Once upon a time there were MUDs, and then MUSHes and MOOs said they were categorically different. They're not.

VWN: I've heard similar discussions about whether or not to consider Facebook a virtual world since it re-creates a community. Do you feel like graphics are important for making that distinction?

RK: Graphics are irrelevant. It comes down to whether it's simulating a place. Facebook does not simulate a place. If it had added pictures and links to click in direction, it ould qualify. For me the dividing line is simulation of place. There were graphical MUDs with that sort of picture layout, and they did just that.

VWN: Is it important pragmatically to pin down these terms or is it mostly an academic issue?

RK: To some degree it's academic. The user doesn't care. I think it's very important for practitioners in the field—whether it's the guys at Blizzard or Studiocom or Sulake or Linden or Iron realms—there does need to be an understanding that MUD1 was a virtual world and Second Life is a virtual world and Coke Studios was a virtual world, and, in fact, they share a vast amount of DNA. They're as closely related as humans and apes. In particular, client representations are just about irrelevant. You could play World of Warcraft in text. You could stick graphics on Facebook. The game lives on the server. The client is just a window.

VWN: You don't think users care? I've heard lots of backlash from hardcore MMO gamers against anything called a "virtual world."

RK: I don't think players care if the term is co-opted. I agree, though, that the players want to know what kind of world they're going to experience. They want the terms. My favorite terms are within the game. There's all this talk about worldly games and gamely worlds. It's the same question, but the question is whether it's directed and game-like or more of a simulation. Runescape is a worldly game and World of Warcraft is a gamely world. Players are always looking for distinctions to tell what kind of experience they're going to have. But it's important for them to realize they're all just different flavors of ice cream. You don't have to like pistachio if you like chocolate, but they're both ice cream.

VWN: How will you give users that information through Metaplace since you're allowing a broad, broad range of worlds to be strung together?

RK: The website indexes every world that is made, and the users can index them and tag every world. We set up categories in part to prod people to realize the diversity of worlds you can make. We have categories set up from furries to church groups, but on top of that, the tags are really where users can find what they're looking for. It's classic Web 2.0 where they build their own taxonomy. We let you search by tag and popularity and recency, the kinds of things that you see on YouTube. We do hope that the worlds are diverse.

VWN: Any reason they wouldn't be?

RK: No. even internally on the team, some people want to make platformers some want to make MMORPGs. The discussion we're seeing from people who applied for the Alpha is really incredibly diverse. We do figure the earliest adopters will want to make games. We are firm believers in the need for fun. There's a big philosophical difference between us and Linden Lab. Linden left Second Life with no content because they wanted everything shaped by users. We're seeding the content because we want to give people the starting points. That lets us say, "Hey, there's something fun to do on Day 1 for the very first people that get there." We are putting a big emphasis on games, but we also wrote the RSS reader and the Amazon storefront because we also find that cool.

VWN: How are you going about seeding content?

RK: There 's a markup system that allows any user to select the world or a subsystem and make it something they can use. We have Metaplace Monday in the office where everyone can use the time to build whatever platform they want. From that is how we're getting a lot of content. That's been loosey goosey, and I think that will become a bit more structured. We'll start making modules in response to things the users are asking for. Particularly later on we may have to extend the platform because we haven't thought of things. Users can make modules too, so hopefully they'll address some issues themselves.

VWN: Have you gotten any alpha feedback?

RK: We've barely begun. We had 10k apps and none are in yet. That's enough to carry us into the beta.

VWN: Any idea on when that will be?

RK: That will be dependent on how the testing goes.

VWN: Do you have a list of items you feel like you need to address before getting to that point or releasing the platform?

RK: Of course we do. We do have a list, but I'm sure that new items will be added to it based on the beta.

VWN: What's on top?

RK: Number one has to be getting all of the tools working on the Web. We won't scale alpha really big until we have that. Basically we have standalone clients, but we see the Web tools as being our primary tools as well. So that's a top priority.

VWN: It seems like there's been a wave of people creating Web-based virtual worlds. How do you feel like Metaplace fits in?

RK: A lot of other people are doing the VastPark and SceneCaster stuff that are single-player worlds basically. There's a place for that, but it's different. Probably the closest to what we're doing is Whirled and some of the stuff that Linden is doing as they open the world. I'm sure we're not unique. We're not claiming to be unique visionary geniuses that had an idea no one else ever had. That would be odd. We really are open in a way that the competition doesn't tend to be. Our game background is unique for the people facing the market. None of these are silver bullets obviously, and you could argue that each is a liability. Overall, we're excited to see all these products.

I look at VastPark and SceneCaster and think, "Hey, maybe they could interface with Metaplace or be a client."

VWN: In the alpha test questionnaire, you asked about game development and coding experience. Is there potential for non-coders to create in the world?

RK: Yes. Early on it's like any content development exercise. You need to have the people to build the foundation. We ask those questions to identify early adopters to build modules. The later users can just combine modules. That said, technical expertise in late alpha won't be as big a deal. It's just as important for us to test the experience of non-builders and even people who are just players

VWN: Is there a specific demographic you're looking at?

RK: We see it driven by the content. The demographic will come based on the content, and we don't know what the content is.

VWN: I know from talking to the SceneCaster guys that one of the reasons  they've stuck with the single-player approach is that they don't feel like users are ready for avatars. I've heard that echoed by others as well. Does that concern you?

RK: I think they're ready for it now. The concept of the avatar in a virtual space is familiar to anybody probably up to their mid-30s and probably later. I don't think it's surprising. The amount of avatars out there is astronomical. Profiles are common. The idea is that it's non-challenging. The response that we've gotten, not just the press, but from the bloggers, has been great. Everyone got it. The bloggers that weren't at the presentation got it better than the VCs who were there.

VWN: As you're moving into alpha and looking toward the public release of Metaplace, what are you most excited about in the space, and what is your biggest concern?

RK: Overall, this is the most fun I've ever had in my working life. So I'm incredibly excited about what we're doing, but also about what's going on in the space. It's an exciting time. I worry about all my friends who are still making the big triple-A MMOs. I don't think they're going away, but their potential role is diminished.

I do worry about virtual worlds having this enormous potential value, like social value, in terms of self-discovery and bridging gaps in cultures and bringing people together who wouldn't normally interact. I want them to reach their potential for that. That's the big boon they can bring society. I do worry that won't happen. The Internet has the great advantage of letting the person who didn't fit in in their small town find other people, but it also has the disadvantage of letting you avoid talking to people not like you. I see that as risky. I think it's important to always be encountering viewpoints other than your own. With Metaplace as a network, it lets you serendipitously encounter that, but I do worry about it.

Comments

[Morrighu]

Funny you should mention this. We're an Open Source Gaming project working on this very concept.

I'd invite anyone interested in to bopping over and lending a hand, particularly if you code Python.

M.

[Morrighu]

Well, that's pretty silly, the form to post comments asks for your URL but then doesn't display it.

You can find us at www.rpg-gamerz.com/smf.

M.