GaaS model can be a bridge for web2, web3 gaming

Disclosure: The views and opinions expressed herein belong solely to the author and do not necessarily represent the views and opinions of crypto.news editorial.

The video game industry is a giant in the entertainment industry, surpassing both music and film combined. It is projected to reach a market size of $363 billion by 2027. While traditional video game models such as Games-as-a-Service (GaaS) have long been the gold standard, the industry faces significant challenges that require innovative solutions.

Historically, the GaaS model thrived in its free-to-play (F2P) incarnation by allowing users to access a core game for free and earn money through in-game purchases such as cosmetics or gameplay perks. The appeal of the F2P model for gamers is easy to see: with no upfront costs and therefore no risk of paying for a gaming experience of unknown value as in the past, there was little downside to trying out new games.

The success of the GaaS F2P model over the last decade has been so incredible that it has become a staple across the industry. From casual games to major industry publishers, GaaS F2P games are on everyone’s books. However, the sustainability of F2P GaaS is under threat as margins are shrinking across the board. This is due to an oversaturated market combined with rising user acquisition costs, and has been exacerbated by recent strict changes to privacy policies.

As the industry looks for a lifeline amidst these growing challenges, blockchain technology is a glimmer of hope for many, with the promise of revolutionizing game monetization through web3. However, early attempts at web3 games focused on NFT collectibles came with a critical flaw: the games needed a constant influx of new players to survive. It was an exciting model, but it was unsustainable in the medium to long term.

The second wave of web3 games took the initial NFT collectibles and developed them into play-to-win (P2E) and token economies. Unfortunately, these systems not only failed to solve NFT collectibles’ reliance on acquiring new users, they also introduced new problems to the table. P2E games quickly morphed into play-to-win (P2W) schemes, demoralizing most players and negatively impacting retention. Worse still, many token economy systems have raised concerns that they are more like gambling than traditional games due to their randomized reward distributions.

This divide is still evident in the web3 gaming community today. It is divided between speculators who are attracted to the financial incentives of P2E models and are eager to turn gaming into a business, and traditional gamers who are increasingly disillusioned with P2W-leaning monetization strategies and are yet to see truly compelling games that deliver what they want: real entertainment value.

Moreover, the broader gaming community, which numbers billions worldwide, remains largely unaware or uninterested in web3 gaming. For many, web3 is still a futuristic proposition, a Wild West of possibilities that only the bravest dare to explore. The truth is, there are significant gaps between the current quality of web2 gaming, the current realization of web3 gaming, and the true potential of blockchain in gaming.

At GFAL (Games For A Living), we plan to bridge the divide between web2 and web3 games with an innovative business model that combines the best of both worlds. The GFAL business model focuses on GFAL game collections and transforms them from in-game assets into real-world values ​​by focusing on ownership, seasonality and standardization.

The first element of our business model is ownership. At GFAL, we enable players to become legal owners of the in-game collectibles they acquire. In other words, when players mint or purchase a GFAL game collection, they are granted a license to use the intellectual property (IP) rights. This means that players can use and potentially monetize these collectibles in never-before-explored ways beyond the gaming environment, if they so choose.

Secondly, all games must follow a “Battle Pass” seasonality system similar to that commonly seen in Gaas, designed to keep the game engaging, fresh, and constantly running. GFAL takes this even further with fusion mechanics, blending it with our unique approach to collectible ownership. On a practical level, this means requiring games to use existing collections to create new ones, intelligently encouraging healthy cross-game marketplace exchange and preventing inflation in the game’s economy.

The third element of the business model, standardization, enables collectible ownership and seasonality with fusion mechanics. All game collectibles must follow a standard system that tracks them based on time spent in the game and assigns them a rarity and level. This allows for the creation of unique collectibles with their own individual history and gives each in-game collectible a comparable and fair value that can be transferred to all other GFAL games.

This pioneering business model, which blends ownership, seasonality, and standardization across games, addresses many of the current concerns surrounding video games. Designed to develop a fair, stable, and sustainable gaming offering that benefits players and developers, the approach could be just what blockchain gaming needs to transcend its niche status and achieve mainstream adoption.

But beyond the business model, we know that products must provide an exceptional gaming experience. Therefore, developers must remain committed to building enjoyable games on their own, with blockchain elements that enhance the gaming experience rather than dominate it.

To support this, we are also developing a robust ecosystem that includes a proprietary personal identity system and a multi-game marketplace. These features are designed to foster a community-centric gaming environment by encouraging interaction and participation beyond the games themselves. This comprehensive ecosystem, open to third parties, is part of GFAL’s strategic approach to reduce friction for gamers transitioning from web2 to web3 and ensure that new technologies are seamlessly integrated into familiar gaming contexts.

As we prepare to release new games later this year, we know the gaming industry is watching closely. No doubt, many are eager to see if this new model can set a new standard for how games are played, owned, and monetized. We believe this approach could herald a new era for the gaming industry, one where the line between web2 and web3 is not only blurring, but effectively erasing, creating a unified gaming experience that respects both the roots of gaming culture and its future potential.

Manuel Ranking

Manel Sort is the CEO and co-founder of Games for a Living (GFAL). With over twenty years of experience in the video game industry, Manel has developed and published over 60 games across a variety of platforms to great acclaim. His analytical, results-driven approach focuses on driving business strategy across free-to-play and free-to-earn models. Skilled in building and leading gaming businesses, Sort has achieved revenue rates exceeding $1 million per day in just two years of operation. Specializing in video game development, strategy, project and product management, HR, and web3 game development, Manel is committed to innovation and excellence by constantly pushing the boundaries in the gaming industry.