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Getting gamers online

Game buff Mark Surfas of GameSpy Industries explains why he thinks online play will become the next big development in the video game market.

Tech Industry
Both Microsoft and Sony are betting heavily that online play is the next big thing for the video game market.

But getting gamers online requires more than putting a modem or Ethernet port in a game console. Any online efforts will require tremendous investments--everything from running servers that host games to handling customer support calls.

That's where companies like GameSpy Industries come in. Formed in 1995 by game buff Mark Surfas, the company offers an arsenal of online software and services for PC games. Leading products include GameSpy Arcade, consumer software that helps online players find each other; an array of tools for software developers to add online components to their games; and services for distributing downloadable games.

Although PCs by necessity have been the company's focus to date, GameSpy is ready to help consoles go online. The company was an early supporter of online play for Sega's defunct Dreamcast console, is developing online services for Sony's PlayStation 2, and was the first to offer online play for Microsoft's Xbox via software that allows an Xbox to tap into a PC's broadband connection.

Surfas talked with CNET News.com about the future of online gaming at the recent Game Developers Conference in San Jose, Calif.

Q: How do you expect consoles to change online gaming?
A: I think consoles are going to lag a number of years behind PC games. We've seen how the PC market has evolved over the past five years, and the console market has a long way to go. On the PlayStation side, you're going to have to wait until the PlayStation 3, we think, for it to get serious traction and for people to get used to the technology.

Sony seems to be a little fuzzy on the business model for online gaming. Will it be the same as PC games, where publishers offer online play just as a competitive thing rather than as a separate revenue source?
Initially, absolutely so. I think that game publishers look at it as, "If I put 'online play' on the front of my box, I'll sell another 50,000 copies."

"We used to talk about the last-mile problem with getting broadband to consumers. Now it's the last 10 feet."
So the goal for them is to get online play in there as cheaply as possible and offload as much as possible to other partners. That's where we come in.

The business model in online gaming is really about delivering the games online. I think they know that now. We think that's a couple years away on the console side.

I think what's going to be really interesting is when developers create direct relationships with millions of consumers and deliver additional content directly to the consumer.

You're talking about downloading all your game software, instead of buying a boxed product, which is already starting to happen on the PC side. Will Xbox bring that to consoles, since it has the hard drive and broadband support?
We think it's at least a few years off. Just the problem of getting broadband to the living room is something nobody's effectively solved yet.

We think it's at least two or three years before people get serious about figuring out how to get the connection to the living room.

To do it today, you've got wireless or wire-line networking. I've got an Xbox in my living room, and I was excited about hooking it up to broadband, but my wife wasn't thrilled at all about having this big blue cord snaking through our house.

What I ended up doing is using phone-line networking. It works great, but I needed $300 to set it up. Not that many people are going to pay the same amount of money for home-networking equipment that they paid for the Xbox itself.

We used to talk about the last-mile problem with getting broadband to consumers. Now it's the last 10 feet.

It seems like Microsoft is envisioning a closed network for the Xbox, where you'd connect through a Microsoft subscription service, while Sony envisions an open network for PlayStation 2. Which approach is going to do better?

"I got an e-mail from Bill Gates--only one I've ever gotten--saying this stuff is pretty cool. I think they were surprised at how quickly it happened. But they like technology; they like seeing new tricks out there."
If we were comparing apples to apples, I'd say the Sony solution wins. The problem is, Sony does not have an Ethernet port built into their box. Getting the box hooked up is more difficult. When the PS3 comes out with that built in, I think Sony will be the dominant player.

I think the odds are against a closed system working for Microsoft. I think it's smart to do it that way, but content providers are going to say, "I don't want to limit myself. I want more options." But if they push enough, Microsoft can always step back and create a more open specification.

Our toolkits are available for every major platform but the Xbox. Microsoft at this point does not want us on there. They do not want cross-platform solutions.

Yet you're already there to some extent with your Xbox tunnel to connect players. How has Microsoft reacted to that?
I got an e-mail from Bill Gates--only one I've ever gotten--saying this stuff is pretty cool. I think they were surprised at how quickly it happened. But they like technology; they like seeing new tricks out there.

The interesting thing is we've gotten a lot of interest from developers. They're saying it's really interesting there's an easy solution for matching players online, and it has nothing to do with this external service Microsoft is building.

So even if Microsoft decides online gaming for Xbox should be a closed service...
They can still develop for this other way of doing it. If developers start building in an option outside of what Microsoft wants them to do, it could be really interesting to see how Microsoft reacts.

It sounds like this could be the game equivalent of Linux for Microsoft, going from a curiosity to a business threat.
It could. We've had around 100,000 installations of our Xbox gaming service. We don't know how many of those are actually hooked up to an Xbox, but that's a huge percentage considering the number of Xboxes that have been sold.

It's pretty clear there's massive interest in online gaming. And we built our whole company around servicing that interest.  

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