Interview: Nickelodeon Kids and Family Virtual Worlds Studios

In July, MTV Networks' Nickelodeon Kids and Family Group announced an ambitious plan to invest $100 million in casual games, online play, and virtual worlds. As a part of that plan, Neopets would be recommissioned as Neostudios with the aim of launching a new virtual world each year. The first world, announced at Virtual Worlds 2008, is an update to Neopets, World of Neopia. As a nod towards larger plans, though, the group is being renamed Nickelodeon Kids and Family Virtual Worlds Studios, "tapping into that expertise of creating and operating virtual worlds to bring that to our Nickelodeon family," explained Senior Vice President & General Manager Kyra Reppen, "at least, that's the working title."

The studio has big goals--other worlds discussed at Virtual Worlds 2008 include one called Monkey World and a virtual world devoted to SpongeBob SquarePants--but Reppen said there was no specific percentage of that $100 million going to the virtual worlds studio. There is enough, though.

"We're getting the commitment we need to be able to grow and have multiple concepts in development, not unlike the way the TV business works where you're developing new IP in new ways," she explained. "We may be developing concepts that become virtual worlds and some that don't, but we want to make sure that we're learning and iterating on new ideas."

The Concepts

The TV model is pervasive. Even Monkey World and SpongeBob SquarePants aren't guaranteed to make it into production. Right now they're solely in the "concepting" phase, two of many ideas that a team led by Keith Tiernan, VP Creative of Neopets. are developing, looking at Nickelodeon's entire library and beyond. They've obviously put more than a little thought into it, though.

Monkey World, if it comes out to the public, will involve the customization and social options typical of virtual worlds while featuring a dose of active gaming.

"It's a lot about more energetic gameplay, stuff that we'd tap into that boys like to do when they play games," said Tiernan. "Neopets leans a little more female than male in our audience, so a game like this might have a little more of that energy that boys like to indulge in."

Likewise, the pair could only talk about SpongeBob at a "high concept" level as the project is still "conceptual and in development." There is a strong motivation to build the world, though, even while kids can already interact with SpongeBob in his own themed space of Nicktropolis.

"It's such an incredibly powerful and iconic brand with so much connection to its audience," said Reppen of the motivation to look at creating a unique world for SpongeBob. "It really got us thinking that there should be a way to give the audience a deeper way to connect with the characters and stories. Who doesn't want to live in Bikini Bottom? That was kind of our jumping off point, but like any concept in development, we're going to go through a series of iterations and talk to our audience as well."

The Theory

With the unified studio, comes a unified theory of virtual worlds--to a point. The goal of the studio is to harness the experience that the Neopets and Nickelodeon teams already have, but also continue to evolve.

"There's a question, though, I think broadly about definitions of virtual worlds," said Reppen. "I like to define them pretty broadly. It feels like the notion of playing together is at the core of it and giving the players a sense of control in that experience. Once you've got that down, the different genres and types of creative storytelling that may happen, whether it's collaborative or family play and different types of gameplay even within that. It seems to me there's a lot more to be done out there than what we sometimes say: 'You need to have a world.' Or you have the MMORPG guys in one corner and the open-ended world guys in another or the Facebook guys in another corner. I think it all ties together, and then there's also some other ideas we have."

Sister company MTV has also been pursuing a unified approach to its virtual worlds, going so far as to push towards a goal of "One World, One Avatar." That doesn't fit quite as well for Nickelodeon.

"Where the world has a fantasy component, it's important for kids to maintain that fantasy," Reppen continued. "It feels right that you're  taking care of a Neopet in a Neopet fantasy world, and it would be odd if you were SpongeBob walking around in that world. So that's one important piece for us."

The overall sense that Nickelodeon has, though, is that there needs to be some sort of a structure, or as Reppen describes it,  a  meta-game. There are individual games inside of Nicktropolis and Neopets, and the overall worlds are fairly open. They still, though, encourage the development of avatars to provide their context.

"I really think it's a continuum," Reppen said. "And, to the point of having lots of concepts in development, we find lots of different points in that continuum. And I think that even Webkinz and Club Penguin and many of the other kid sites have some structure to them. In Neopets, the pet is your focus. You take care of your pet, level your pet, enhance your pet, make your pet special—those are all parts of that key, core component of that meta-game. In fact, the thing that our audience is doing the most on the site is playing games, and that means the specific games as well as the uber-game of earning points for your pet. And what they tell us is the primary motivation of coming is that it's all about the pet. There really is that incredibly important emotional investment they have to the world."

In other words,  the avatars are the reason they come to the virtual world, and games are the things they do.

The Existing Products

While there's plenty to talk at the high level about and certainly interest in the potential for upcoming games, Nickelodeon already boasts some of the most successful kids virtual worlds out there. Even within Neopets and Nicktropolis, though, there's still plenty of change and evolution.

When Neopets introduced a cash economy last year, while many users embraced it, many others had strong negative reactions. They didn't want a world where users could skip the sub-games and advance the meta-game. Nickelodeon wanted a premium experience, though, for users who wanted to invest more money into the world.

"At first, as always with anything new on the site, and we see this every single day, there's some people upset about it and resistance to anything different," said Reppen. "We keep a close eye on that and adapted as we went along. At first, the items expired, and it really didn't make sense for the audience because they felt such a deep sense of ownership, so we removed the expiration. The Neocash and Neopets Mall experience is not for everyone, but  the folks who it is for love it."

Nick's experience afterwards  wasn't that the barrier was purely conceptual, there was also the question of how kids could add money to the virtual world. Now there's a partnership with Nexon and prepaid cards as well as PayPal, and the cards have taken off with retailers like Target embracing them. And Nick's pleased with the outcome as well.

"There are 750,000 daily Neopoints transactions going on," said Reppen. "The Neocash transactions are certainly less than that, and we expect it to be less because it's a premium experience, but we've been really happy with that."

Based on that experience, Nickelodeon is prepping to launch a premium experience for Nicktropolis as well, but waiting to announce details until the process has been refined.

An alternative monetization scheme, selling physical products, is an easier hit.

"In our case, we already had a huge community of loyal fans, not just our active users, but we've been around since 1999 so there's a great mass of people who have brand awareness of the site and, in some cases, nostalgia for it," said Reppen of Neopets' decision to launch a product line.

After the long process of building an online brand, Viacom licensed the Neopets IP to Harper Collins for a series of books last June before announcing its intentions to create its own line of toys and merchandise through JAKKS Pacific last fall.

"We wanted to look at driving our audience to the product and what that product can mean for them on the site as well as how we can reach new audiences who discover the product in-store and then enhance that product on the site," she said. "So it's a bit different from the traditional toy company approach."

There's an implicit feedback loop for the users between the real and the virtual,  but for the developers, everything works with the same motivations. Picking up a virtual toy just isn't that different from shopping for a physical version.

"They're not that different," said Tiernan. "Kids are natural collectors. People in general, actually. People always want the thing that someone else has. So whether they're collecting toys in the store or assembling them online, it fits together. So you look at the behavior pattern and the gameplay equivalent. For us it was that you collect tokens and show them off and now you can use them in a multiplayer game and pick which one you want to use today and show off."

Neopets plans to launch additional toys this fall.

The New Worlds

Monkey World and SpongeBob might not make it to market, but there are other virtual worlds (or virtual world extensions) that Nick has definite plans for, Neopets: World of Neopia and PetPetPets.

The first has already been discussed as a browser-based, richer update to Neopets. The latter adds another expansion that's both smaller and larger. In Neopets, users neopets can have their own pets, called PetPets. PetPets, in turn, can get PetPetPets, virtual flea-like nuisances that, unexpectedly, became very popular.

"We introduced them a few years ago on the website as a nuisance," said Reppen. "They’re popular now. It’s that collecting thing. Even if we intended it to be this incidental event that users might have wanted to not happen, because it’s rare and unique, it picked up in popularity. So we looked and thought, 'Well that might be kind of neat to have a really cool ant farm. Hopefully in the future we can expand that.'"

That future is coming sometime this summer. Nick is prepping to launch PetPetPets (or "P3" in development meetings), a virtual ant farm/light real-time strategy game that runs on Adobe Air and ties back to the world of Neopets.

"It’s a virtual ant farm essentially, but it’s got a lot more character," said Tiernan. "The opportunity was there so we could put something on the desktop that could speak to the Web and get updates from the Web and have a back and forth. Trying to figure out what we wanted to  do with that, we came up with the idea that we’d create this persistent activity in this game that has both resource management gameplay and really light RTS qualities, but is also kind of an office Zen Garden kind of thing that you can just have on your desktop and watch what’s going on."

Each P3 in the virtual farm has its own AI that dictates what role it plays in the colony: they'll build, eat when hungry, sleep when tired, and defend if the colony is attacked. The whole world operates in the background when the user isn't logged in, slowly plugging away whether on- or offline.

Users can, though, take a more active approach.

"They can influence them," Tiernan said. "The P3s will do what is in their hierarchies of intelligence to do, but you can pick them up and move them and they’ll reconsider their situation and what they’re in proximity to and go do things of interest. There are some thigns that override others. If there’s danger, they’ll defend.  If there’s food, they’ll eat. Their main background activity is to harvest resources and build their colony."

That may sound more inline  with the Zen Garden approach and interest adults (at least me) more than Neopets traditionally would. It leads back to the original Neopets philosophy of the avatar, though.

"They have personalities," Tiernan explained. "The fact that you can name them lets you identify with them. Kids project what they want the characters to be or the world to be, so it ties back into our Neopets philosophy."

It also ties back to Neopets. While users can play with PetPetPets and never touch the actual Pets or Neopets, there's a richer experience in the virtual world. Part of the revenue stream for P3 comes from virtual good tie-ins in Neopets that can be brought back to PetPetPets, but users can move in the other direction as well, harvesting honey and other items that can be sold or traded in Neopets.

For all of its projects, Nick is committed to accessibility.  World of Neopia, while richer, is remaining purely browser-based with traditional plug-ins. Adobe Air is something of an unknown quality, though, especially with kids. It seems to fit in to the television model of the new studio, though, experimenting with new formats (like the now prevalent webisode) on the side of major endeavors.

"I think this falls in the category of innovating," said Reppen. "We want to be trying new technologies and new gameplay patterns. Our hope is that over time the new application will be as successful as Flash is today. We know we’re a bit more on the cutting edge with this, but it gives us an opportunity to innovate and learn. whereas with a bigger project like World of Neopia, we were committed to that accessibility."

There's one other benefit for the new studio, said Reppen: "It’s very cool, our programmers love it.