The gaming industry is poised for further growth, even after lockdowns ease, but insiders expect its future will look far different as companies add more social and interactive features and expand their worlds beyond a single platform.
<p>That was the consensus from a panel at dot.LA's recent summit, where four heavy hitters from L.A.'s gaming industry traded thoughts on what they're preparing for. Panelists included Ophir Lupu, head of video games at talent agency UTA; Lisa Anderson, SVP of studio operations at Jam City; Rob Ricca, VP of corporate development at Scopely; and Gregory Milken, managing partner at March Capital, where he focuses on gaming investments. </p><p>Here are four key takeaways: </p><h2>Gaming Less About Winning, More About Partnering
</h2><p>Already, games like Fortnite and Animal Crossing are providing users with virtual experiences that one would be hard-pressed to call a "game." Fortnite has hosted virtual concerts attended by millions, while Animal Crossing has provided a virtual venue for weddings, graduations and funerals. </p><p>"What's come to the fore in the pandemic is really that gaming is social," said Milken. </p><p>More than that, Anderson noted that COVID has underscored players desire to find meaningful connections through their consoles and apps. As a result, Jam City is exploring ways for players to find their friends more easily and join social groups, whether with IRL friends or ones they meet online. </p><p>Similarly, Ricca noted that many players of Scopely's "Star Trek Fleet Command" have turned the game's "Alliances" feature into "their core experience in the game," opting to partner up with others to game on an ongoing basis rather than linking up with an ad hoc group or going it alone.</p><p>As to how this trend will shape Milken's investment strategy, he said he'll be looking to place bets on cooperative gameplay experiences in the future. </p><h2>Gaming Will Be Everywhere
</h2><p>As Anderson put it, "the ultimate goal is that players can experience their favorite game on the device of their preference. Looking to other mediums (like streaming services), consumers can already do this (PC, TV, Mobile, tablet, etc.) and it feels like gaming is a natural extension of that conceit."</p><p>This sort of "cross-play" already exists to an extent, but the industry is evolving further away from the closed ecosystems that rely on a single console. That reality won't fly with younger generations, who've grown up with a more open ecosystem that has shaped their expectations.</p><p>"They will expect all game environments to be open for all of their friends and other players to join and experience rich social interaction with each other, regardless of where they are physically located and the number of other players they want to interact with," Ricca said. </p><p>Lupu surmised that as more game-streaming services come on the market to rival incumbents like Playstation Now or Google Stadia – which give console and PC gamers near-instant access to titles without requiring downloads – the industry may see large platforms build better access for players to move across different platforms and interact.</p><p>As a hypothetical example, Lupu said: "You could imagine how Amazon's new streaming game service Luna could connect with Twitch and allow viewers to 'jump in' or somehow interact with their favorite streamers playing games. (Same with Stadia and YouTube, etc.)." </p><h2>Esports Will See More Cooperation and, Possibly, Consolidation
</h2><p>For all the hype that esports generates, it's a rather small business, generating just north of $1 billion per year – a fraction of the $150 billion-plus gaming market. Its function often appears to be more of a marketing tool than anything, whether for the game titles themselves or for teams that leverage their roster's followings to sell other items like merchandise. </p><p>Unlike a traditional sport, games have an owner – Riot Games owns League of Legends, for instance, but nobody owns soccer. This potentially weighs the scales of influence in favor of game developers and publishers, and away from esports teams. But as the teams grow more famous and build more brand equity of their own, their leverage will continue to grow.</p><p>This leads Milken to conclude: "I think we'll see further development between teams that operate and game developers and publishers and thinking about how they jointly work together to create value." </p><h2>Fans Mix with Celebrities in the Metaverse
</h2><p>Although it's still anyone's guess what will be the ultimate version of the metaverse – a parallel virtual world, kind of like a more immersive version of the internet – what appears unambiguous is that the metaverse offers a unique opportunity for IRL stars to engage with their fans. </p><p>"It creates incredible touch points for non-gaming clients – certainly mostly in the music space," said Lupu. "It provides a really unique and interesting opportunity for talent of all types to interact with their fans." Expect these to continue, in other words. </p><p>But such interactions won't be exclusively between fans and stars. Milken said he sees the metaverse introducing a new level to in-game interactivity that is an increasingly important component of what gaming offers consumers. </p><p>"The metaverse as a hangout place, where you're experiencing things together, is really interesting to me," he said. </p><p>When asked to place their bets on what consumers are most likely to see in the industry, the panelists unanimously chose the concert of the metaverse, agreeing that in their various lines of business it is a future that has to be taken seriously. That nobody has much idea of what exactly it will entail suggests that the metaverse will emerge over a prolonged period, with a series of incremental changes that eventually transform gaming. See you there. </p>
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The pandemic may have accelerated consumers' shift online, but don't expect Americans to forgo theaters permanently for streaming or stop shopping at the grocery store. Concerts and conferences will eventually come back, but the post-pandemic future will likely be very different.
Those are some of the insights from Atom Tickets co-founder Matthew Bakal and Greycroft's Elaine Russell, who spoke in a dot.LA Summit panel moderated by KPMG audit partner Charity Manley on Wednesday. Atom Tickets is a digital movie ticketing service and Greycroft is a venture firm which focuses, in part, on retail.
<p>Though many are staying home, Americans are still spending money, Russell said, and ecommerce is doing much better than many predicted.</p><p>
"We went through an acceleration during this pandemic that we thought would take five to 10 years," she added. "And we just achieved that digital acceleration over the last nine months. And I think it's only going to continue."
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The turn to ecommerce was a trend long in the making, one that is reflected in the decline of shoppers flocking to malls and stores on Black Friday in recent years and the increased numbers of online purchases on Cyber Monday.
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"Black Friday will not be what it used to be. Cyber Monday is where it will be at," she said. "We've already seen that trend over the past few years."
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One of the most dramatic shifts online has been in the grocery industry. Pre-pandemic, about 2% to 3% of all sales were made online through apps like Instacart or grocers' own apps and websites.
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"Right now, it's closer to 10 to 15%. We think that in the next five years, that'll increase to 20-plus percent of all grocery spending," she said.
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In both the event and retail spaces, Bakal and Russell believe consumers will emerge from the pandemic used a hybrid shopping experience. People will prefer shopping at brick-and-mortar stores or seeing events in person. They'll rely on ecommerce for convenience, they predicted.
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"Post pandemic, [people] will go back to some sort of mixed behavior where they will go to the grocery store for some things, but a lot of other things and their traditional sort of staples, they'll buy online, and have delivered," said Bakal.
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Movie theaters have slowly opened in many parts of the country and people are returning to the cinema, but the movies haven't followed. Still, Bakal is optimistic.
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People are "going to movies, going to restaurants in the country at a lower, but a growing rate," he said. "So for us, it's been about shrinking down to the right size, and focusing on the future to make sure that we're here at the other end of this."
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While streaming will still be a big part of people's lives, Bakal believes people will still go to the theatre or drive-in — another form of movie-viewing that has surged during the pandemic — for an in-person experience.
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"I think movie theaters, movies will be back earlier than concerts and live sporting events, perhaps because it's just the amount of people in the crowd control," said Bakal. "The planning it takes to deal with those types of venues is different and takes a little more lead time."
</p><p>
In many ways, theaters are facing the same dilemma that restaurants are, as would-be diners begin creating their own traditions at home. That doesn't mean there isn't a space for dine-in restaurants, it means there is an opening for creating new versions of that.
</p><p>
"There is a shift towards these home-cooked meals and towards family and health and all these different markets," said Russell, adding they "kind of roll up in the same thesis — that there's a lot of room for innovation around this, a lot in this space and a lot of opportunity."
</p>
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Researchers are getting closer to using bionics to treat patients with memory loss and depression, but they'll have to address some crucial questions before it's commercialized. That's what three neurology UCLA researchers and professors said during the dot.LA Summit panel "Building the Bionic Human in L.A." hosted by managing editor Rachel Uranga.
Most of these concerns have to do with the ethics, safety and security of implanting brain chips, which are designed to stimulate memory functions for patients with Alzheimer's or inhibit them for patients with PTSD.
<p>And they were skeptical about Neuralink founder Elon Musk's <a href="https://www.wsj.com/articles/elon-musk-launches-neuralink-to-connect-brains-with-computers-1490642652" target="_blank">promises</a> to quickly bring to market a device that interfaces with the brain that Musk says could ease depression or other ailments. The bottom line, they said, was that there's still a gap between the technology and what researchers know about the brain. </p><p>"What are the guarantees that we can provide for these devices? Can I guarantee it'll work on ten out of ten patients and if not, is it worth the risk associated with the implant?" said Fabien Scalzo, assistant professor of neurology and computer science at UCLA. "I think there are still a lot of questions regarding that."</p><p>Each of the panelists focus on a different aspect of bionic engineering at UCLA: Scalzo works with a team to produce the hardware that Nader Pouratian implants into the brain. Meanwhile, Nanthia Suthana examines its effects on the patient's neurological functions. </p><p>Pouratian, a professor and vice chair of neurology at UCLA's school of medicine, said brain stimulation devices evolved from cardiac pacemakers, the first of which were developed in the 1970s. </p><p>"It's the same idea," he said. "We've been using that technology for over two decades. It hasn't changed radically in that time until very recently." </p><p>Today, engineers, scientists and neurosurgeons are rallying around an industry that's seen rapid growth. Specifically, they're working to stimulate the brain with greater precision and listen to brain activity, similar to the way doctors listen to the heart. The other key component of development includes improving the patient experience. Think scaling down the size of these devices and making them both wireless and rechargeable. </p><p>"The fear of brain stimulators has significantly diminished," said Pouratian. "As we expand and understand that better and make it safer, I think we're going to see it much more commonly accepted and sought after." </p><p>The devices in development are largely geared toward helping people with ongoing conditions, but Pouratian said he could see a day when people use them cosmetically to enhance memory, for example. The prospect could potentially expand human potential but would raise a whole host of concerns including access and the possibility of these devices being hacked. </p><p>Suthana, a UCLA assistant professor of neurosurgery and bioengineering, said some of the fears you hear surrounding bionic solutions might be premature. </p><p>"We're not quite where people might think we are in terms of doing these nefarious things that people suggest or 'Black Mirror' likes to show in their shows," she said. "But it's still absolutely critical to think about these things before we go down this road." </p>
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