Metanomics transcript april 21 2010

METANOMICS: VIDEOGAMES IN OUR DAILY LIVES:
INTERVIEW WITH JESSE SCHELL - APRIL 21, 2010

ANNOUNCER: Metanomics is owned and operated by Remedy and Dusan Writer's Metaverse.

ROBERT BLOOMFIELD: Hi. I'm Robert Bloomfield, professor at Cornell University's Johnson
Graduate School of Management. Today we continue exploring Virtual Worlds in the larger
sphere of social media, culture, enterprise and policy. Naturally, our discussion about Virtual
Worlds takes place in a Virtual World. So join us. This is Metanomics.

ANNOUNCER: Metanomics is filmed today in front of a live audience at our studios in Second
Life. We are pleased to broadcast weekly to our event partners and to welcome discussion. We
use ChatBridge technology to allow viewers to comment during the show. Metanomics is
sponsored by the Johnson Graduate School of Management at Cornell University. Welcome.
This is Metanomics.

ROBERT BLOOMFIELD: Welcome to Metanomics. This is our last show of the spring 2010
season. Fortunately we don't have to spend too much time thanking everyone who's helped out
because we did that last week at our one-hundredth episode party, and, hey, I even sang your
names out loud so who can ask for more than that. This lets us jump right into our show and lets
me introduce our great closing guest, Jesse Schell. Jesse is a professor of entertainment
technology at Carnegie Mellon University in Pittsburg. He's a former creative director of the
Disney Imagineering Virtual Reality Studio and the founder of Schell Games, his
game-development company which I believe is the largest game software developer in the city
of Pittsburg. He's also the author of a book The Art of Game Design, a book of lenses, which
Game Developer Magazine named Book of the Year in 2008. Jesse, welcome to Metanomics.

JESSE SCHELL: Hi, there.

ROBERT BLOOMFIELD: So I actually want to start with a question that someone on the staff,
Rob Walker, asked when he was providing me with your bio, which is, "Do you ever sleep?"

JESSE SCHELL: I do sleep from time to time. It has been known to happen.

ROBERT BLOOMFIELD: Well, you certainly have been incredibly productive so I'm sure it's not
something you do every night.
JESSE SCHELL: I was going to say there's 168 hours in the week; I try and use them all.

ROBERT BLOOMFIELD: We can all try to emulate that. I know that there's something that's
maybe been keeping you up late because you've been thinking about it, and that is the
Gamepocalypse, a fantastic name. What is that?

JESSE SCHELL: Right. The Gamepocalypse was kind of an idea introduced at a talk I gave at

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the DICE Summit back in February. The fundamental idea is just something I'd observed, is how
game play for entertainment is kind of creeping out more and more into reality so we see things
like we went from regular game controllers to the Wii Mote, and we're going from the Wii Mote to
Microsoft is going to have the NitAL, and PlayStation's going to have the Move. So we're getting
more and more sort of realistic in terms of physical qualities of game-play. And then on
Facebook, we're starting to play games that involve our real friends, and people who are on
Xbox Live are doing that in other ways as well.

And then at the same time reality is coming back the other direction, by turning things into
games. You're getting frequent-flyer miles. You get points. And credit cards, you get points. And
at the grocery store, you get points. At the gas station, you get points. I started to see that these
things are all converging. And when you combine that with the way technology is getting less
and less expensive, to the point that it's going to be disposable. And we're going to be able to
track and sense every move in everything that we do throughout our lives. People are going to
start turning that into games, and so the Gamepocalypse is the moment when every moment of
your life, 24 hours a day, is woven in with a game in some way.

ROBERT BLOOMFIELD: There is one example that you gave in that DICE talk, and, hopefully,
one of our staff can pop the URL in chat so people can make sure they get it. It was a fantastic
talk. I really enjoyed that. And there was one example that really made the Gamepocalypse
come to life for me, and that was when you talked about the toothbrush with the sensor. Could
you paint that picture for us?

JESSE SCHELL: Yeah, right. So in the talk I tried to kind of paint a picture of sort of a day in
the life of once the Gamepocalypse happens, and I started the day with when you get up to
brush your teeth. And, of course, your toothbrush is going to have a sensor in it that can tell that
you're brushing your teeth and how long you brushed your teeth. And if you brushed your teeth
the right way, with the right amount of pressure and in the four corners of your mouth, and the
right up and down strokes, you're going to get a certain score based on how well you brushed
your teeth. This is probably a health thing because the better you brush your teeth, the better it
is for you.

But then it's also in the best interests of the toothbrush company because most of us, let's admit
it, don't necessarily brush our teeth two or three times a day. A lot of people don't do that, but, if
you do, you use up your toothbrushes faster, and it sells more toothbrushes. So your toothbrush
will likely be WiFi-enabled and be able to just kind of upload immediately information about
whether you've done that.

ROBERT BLOOMFIELD: And we have a [lead?] for your friends and family.

JESSE SCHELL: Yeah, right. Very good. Sure. You may well have it connected so that you can
kind of see a leaderboard of how are you doing, in terms of tooth-brushing compared to your
friends and family. It's very possible. And it's funny, after I gave the talk and I sort of put that as
a slightly humorous example, someone said, "Hey, have you seen the Oral-B? Oral-B has a
toothbrush now that it is halfway there." It has a digital sensor that measures the pressure
you're brushing with, and it can tell when you're brushing, and it has timers. And when you
brush for a full two minutes, it lights up a little happy face. And, if you don't brush with the
requisite amount of time, in the four corners of your mouth, it gives you a little sad face.

We can't be very far away from that going WiFi. And, in fact, there's already a WiFi bathroom
scale so that every time you weigh yourself, it automatically uploads your weight to a database

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so that you can see a graph of it over time. And, if you like, you can configure it so that it goes
directly to your Twitter. You can tweet your weight every time you weigh yourself. I don't know
who would want that, but you could do it.

ROBERT BLOOMFIELD: We're getting responses already from the audience. Kerry Takashi
says, "This is wrongheaded on so many levels. There will now be nothing in our lives that can't
be commodified and scraped. Of course, with no compensation for any of us." Reaction?

JESSE SCHELL: Well, yeah, sure. And this is probably the reason I like to talk about this is that
it does terrify people. People are like, Oh, this sucks! Well, what are you going to do? How are
you going to make it not happen is kind of the question because these systems are all going to
be systems you can choose to opt in. I hear a lot of people just talk about, "Oh, I would never
want that kind of invasion of my privacy," and very often these are the same people who choose
to use Gmail. And anyone who uses Gmail has a major corporation scraping through every
communication that they make digitally, painting a detailed picture of what they think you're like,
and figuring out what messages would be most likely to distract you, and then popping those up
on the sides, in hopes that those personal, customized advertising messages created by going
through your personal correspondence, hoping that they'll distract you. And people are okay
with this.

And so they're going to be okay with a surprising amount of stuff as we go forward. And part of
the reason I like to talk about it is, I think it's good for people to start thinking now about, "Wow!
What's okay to tolerate and what's not?" I mean, frankly, I'd rather have people know
information about my tooth-brushing habits than combing through my email.

ROBERT BLOOMFIELD: One of the things that surprised me is when I was first getting into
Second Life, I was emailing with people who don't necessarily talk about the types of things I
tend to write about in emails, which are very "businessy" and "academicy." I had a couple
people, in the course of a week, tell me, "You know the quality of advertising I've been getting
since we've been emailing back and forth has really improved." So it was like, "Wait! Hold on! I
didn't sign up for Gmail. I'm using my Cornell account." And, of course, they've got my
information as well. So it is pretty frightening stuff.

Fleep Tuque, who's one of the educators who's very active in Second Life, in technology in
education, says, "I'm dying to ask Jesse: Your talk made it sound that you are hopeful that these
games could be a positive change for society. Why are you optimistic and how realistic is your
optimism?"

JESSE SCHELL: It's a real good question. When I gave that talk to kind of be intentionally a
little--I wanted to make people think. I wanted to present it in a way that would not--because if I
came out and said, "Oh, this is horrible," then people would say, "Oh, I guess it's horrible. We
don't have to think about it." But, if I can't come out and I'm kind of flip-flopping and kind of
ambiguous, people will like, "Wait. What the hell is this? Is this good? Is this bad? What is this?"
Because I think we don't necessarily know. We need to think about it.

Yeah, it's true, at the end of the talk I struck a little bit of--first I paint this sort of slightly horrific
picture of being monitored every second of your waking life, but I really believe we'll be
monitored as we sleep as well. We'll choose to find various ways to kind of turn our sleep
patterns into gaming and our dreams into gaming. So you'll have every second of your life being
monitored, and it sounds sort of horrible. But at the same time one of the things we know, and
you're the economics guy; you're probably going to know the name of this. I always forget the

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name of it. There's I want to say it's the Hoffman Effect. I'm always forgetting the name. When
people are monitored, they perform better at things.

ROBERT BLOOMFIELD: Thorndike, I believe. But I’m not--

JESSE SCHELL: There you go. Thank you. I think that's right.

ROBERT BLOOMFIELD: But you know what? We have enough people in the audience.
Someone will say, "Yes, that's what it is."

JESSE SCHELL: Some smart person will know what it is. But the fundamental idea is that
when people are monitored, they do better. And, if we're going to create a situation where we
choose to be monitored all the time, it may well change the nature of our discourse, the nature
of our habits, the nature of what we choose to do. And maybe that will be better. I think, in some
cases that will be true. I think, in some cases, probably won't be. But it's an interesting question
because we're going to have really good stuff showing up, really bad stuff showing up, and
which one's going to win, we're going to have to kind of wait and see.

ROBERT BLOOMFIELD: First of all, it's the Hawthorne Effect. I knew that!

JESSE SCHELL: There you go.

ROBERT BLOOMFIELD: So we got a couple people in the audience, and they did research at
this time, but it's the Hawthorne Effect.

JESSE SCHELL: No, I like that because I said Hoffman, and you said Thorndike, and you put
those together, and you get Hawthorne so it works out.

ROBERT BLOOMFIELD: And, of course, all I can think of is Roger Thornhill from North by
Northwest, but that's a different story. We'll get to my questions eventually, but we've just got so
many great things in the chat. Here are two that are related: Dusan Writer points out that one
response to a lack of privacy is to increase the amount of misinformation that we publish. And I
want to combine that with another comment and question from Nany Kayo, that says, "You have
said authenticity has become highly valuable and marketable." She's wondering why that is and
how others react to that statement. I'm wondering whether you see a conflict between
authenticity and people trying to protect their privacy.

JESSE SCHELL: Oh, well, right. That's a very interesting question because giving away your
privacy means you're being a more authentic person. In other words, it's more authentic to walk
around naked than not, right, in some sense. People now have more ways to express
themselves and show who they really are than they ever did before, and so there is, I guess, a
kind of attention there, and we see this in things like Facebook. And we see it in things like
Twitter.

Are you okay with letting people know where you are, what you're doing, even though some of
those people might be strangers? Some people really enjoy being able to do that and get
significant benefit out of it. But you get that kind of authentic sharing by giving up your privacy.
We could all walk around wearing masks all day, if we wanted, to really protect our privacy, but
you would say, "That person has something to hide. They're not being authentic with me."

ROBERT BLOOMFIELD: I just want to point out just because there seems to be so much

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interest in the chat on this privacy issue, I am going to paste into chat a link from a show that we
did, I guess this was last fall, on cyber security and the government's perspective on this. And
one of our guests was Robert Young, who's the Director of the National Defense University's
Information Assurance Lab. And, if you want to never be able to sleep again, worrying about
everything you do with Twitter--the Twitter made me think about it because one of the things he
pointed out is how much criminals love to know every time you leave the house to go to the
store you're going to post it on Twitter. Anyway, you can follow that link, and it's a very, very
interesting and fairly frightening conversation there.

Let's see. Let's move on. We got, wow, lots of comments, but I'm actually going to change the
topic a little bit away from the privacy issue, but I don't know that this is any less scary. In your
DICE talk, you talk a fair bit about the psychological tricks that make games successful. For
starters, can you talk about some of the tricks that you see? I don't know if "favorite" is the word,
but some of the most effective ones that you see.

JESSE SCHELL: Right. In the talk I mentioned a few that are kind of new on the horizon
because the world of game development has changed quite a bit in the last few years. It used to
be everything was about retail, and all retail meant is, you have to get people excited about the
idea of your game so that they will go and buy it. And once they've bought it, you just want to
make it an enjoyable experience as possible so that, hopefully, they'll tell other people about it.
And that was pretty much the beginning and end of that, of how you sold the game.

Nowadays, it's very different. The idea is, there are many games. We give them away for free,
or we give some part of them away for free. And then, at some point, as you're playing, we have
to figure out how to get the money out of you. In order to that, you have to kind of engineer
these psychological moments where people decide, "You know what? I think this is the time
when it's worth paying money." And it's not a moment like when people naively think about it,
they think that someone does a calculation in their head where they're like, "Well, you know, I've
kind of been having fun here. I guess I owe it to these guys to put money in." That's mostly not
how it ever really happens.

Much more realistic is a situation like you at the game Mafia Wars, which you can sign on and
you play for free. Your real friends are all part of the game. Whether they're playing the game or
not, they become characters in the game. And you can see how you're doing compared to your
other real friends who are playing the game. And people start to get very competitive about
Mafia Wars. The trick with Mafia Wars is, you can play it for free, but you only get a certain
amount of energy, a certain amount of moves you can make each day. And, if you want to make
more than that, well, you have to wait to come back tomorrow, unless you want to kind of put
some money in.

Most people are like, "No, I can be patient. I'll wait. I don't want to waste money on something
like this." But then sometimes there'll be these moments where they see, "Man! Look at how my
friend is doing. Look how they're doing so much better than me. Wow! If I just put five dollars,
ten dollars in here, I could kind of get an edge on them, and maybe I'll go for that." And it's kind
of finding those moments. FarmVille has some of the same moments, but its situation is a little
different. Brian Reynolds, one of the designers there, has spoken about it publicly, that "shame"
is one of the tools that really makes FarmVille work.

ROBERT BLOOMFIELD: You don't want to let your cute little animal die?

JESSE SCHELL: Right. Or maybe you got a bunch of crops. You've got this big farm, and it's

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kind of neat looking. You put a little house up next to it. You put a cow next to it. And then you
got all these strawberry plants in the middle, and, oh, if you don't come in and water them, not
only are you going to lose the fruit that would have come from them, but--they're not just going
to disappear. They're going to turn brown and be ugly, and it's going to be kind of shameful. And
you'd say, "Who's going to see it?" But the game is set up to give you incentives to visit your
friends' farms. And people are afraid. They're like, "Oh, I don't want people to see I haven't been
taking care of my farm. It's going to look terrible. You know what? Oh, I can pay extra money so
that my crops will stay watered longer."

And they'll sometimes chip in for that so they like, "Good. Now I don't have to worry about it. It'll
get taken care of, and I don't have to have that possibility of that shameful moment." And
engineering things like this into games is sort of a new idea for game designers. And we're all
kind of getting used to it and starting to figure out how it works and how we feel about it.

ROBERT BLOOMFIELD: People are already--you know, looking in the chat, talking about the
concerns about these different alternative models. First let me point out what I heard you just
describe is, for one thing, so it's now pay per experience as opposed to just that you're going to
pay as you participate, so it's a little more like a subscription model, except you don't have to
pay if you're willing to be shamed or work harder, do more of the grind of the game and so on.

In your DICE talk, you also talked a lot about things like lead generation. I was very interested
here. I don't remember if this was in the talk, but you were telling me yesterday about
Microsoft's agreement with Zynga on becoming a fan of Bing. Can you tell people about that?

JESSE SCHELL: Sure. Because one of the key points to understand about how game
development is changing is this whole idea of presently it manifests itself as something we call
lead generation. We don't have the exact numbers on this, but it's estimated that Zynga and
companies like Zynga are making at least half of their revenue not from micro-transactions
where someone gives their credit card over. They make some money from that, but it would
appear they make at least half their money from the concept of lead generation. And that's the
idea where, "You want more farm cash for your farm? Well, sign up for a credit card now. Sign
up for Discover Card, and we'll give you 25 farm cash right away."

And one of the promotions that Microsoft did was, they're trying to make their Bing search
engine more popular, which is a tough job, right? They got to go up against Google. And they
did a promotion with Zynga where, if you became a fan of Bing on Facebook, which is effortless
for most people, you would get three farm cash. And so many people took advantage of this that
Microsoft feels that it drove significant traffic to their Bing site and that they felt it was a really
good use of their marketing dollars to spend in this way.

I think we're just seeing the beginning of this because marketers are starting to understand the
incredible power that these virtual economies have. I think we're just at the beginning of that. I
think very soon we're going to be seeing situations where you buy groceries at the grocery
story, and you can automatically get gold in World of Warcraft, that sort of thing.
ROBERT BLOOMFIELD: I see one direction. Now I didn't know anything about this, but
Perplexity Peccable points out, well, she asks, "What do you think of last year's news about
FarmVille money being provided to people who wrote letters opposing health-care reform?" Are
you familiar with that?

JESSE SCHELL: No, I hadn't heard that, but don't know that that happened, but, if it happened,
I totally believe that it would have happened because this is the thing everyone's going to be

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figuring out, that these virtual currencies mean something to people. They drive people. And, if
you want to buy some from the company who owns them and be able to give them away, they
can be a really strong motivator to encourage whatever kind of behavior you want to encourage.

I'm waiting for the day when the cigarette companies start to get more involved in this. And I
also wonder about the Military. I can see it now, "Join the U.S. Army Reserves, and get a battle
fortress in World of Warcraft worth a million gold." I think there are going to be these ethical
decisions and dilemmas that game developers are going to have to face and decide about, that
they've never had to deal with before.

ROBERT BLOOMFIELD: I think it was Dusan Writer who asked, "In what forum are game
developers having these ethical discussions?" Someone else asked, I think rhetorically, "Are
they having these discussions at all?" Are you aware of discussions like this going on and
maybe considerations of self-regulation before Congress gets nervous and does something
stupid?

JESSE SCHELL: You got to remember the game-development business, everybody's just
moving at a thousand miles an hour all the time. People are talking about this a little bit, but no
one quite knows what to do about it. I guess the conversations are just starting. You have to
remember this stuff is all fairly new. FarmVille didn't even show up until this past July. And, for a
while, people were like, "Oh, this is just a fad. This kind of stuff's going to go away." It doesn't
seem to be going away, and everybody's trying to figure it out. So the conversations are only
just starting, but, again, game developers are not used to having this conversation so they don't
really have much of a forum for it.

ROBERT BLOOMFIELD: Let me ask this a slightly different way, which is, as you talk about
these game-like elements, the toothbrush with the sensor, those have game-like elements, but
it's not actually a game. Do you think that this is an industry that the game developers are going
to actually be making the money in, or are other people just going to see what the game
developers are doing, and people from other fields will come in and take over?

JESSE SCHELL: I think the people who are going to make the money are going to be clever
entrepreneurs who are able to partner with the right game designers. I think those are the folks
who are really going to sort of succeed.

ROBERT BLOOMFIELD: Okay. Let's see. Let's talk about hardware. Well, actually let me ask
this: FarmVille, I guess, seems like one of the big game-changers here. What is it that has
allowed this to happen now? Is it just that they had a brilliant idea, or is it some confluence of
the technology, the hardware and the software and the social environment that they tapped
into?

JESSE SCHELL: What it took for something like this to happen is for Facebook to be popular. It
wasn't enough for Facebook to exist. We needed a social network that had a [AUDIO GLITCH]

ROBERT BLOOMFIELD: I don't know if that's me. I have lost your sound. Can you hear me all
right?

JESSE SCHELL: [AUDIO GLITCH]

ROBERT BLOOMFIELD: Okay. Let's see. Oh, I think he lost his dot.

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JESSE SCHELL: I can hear you. Can you hear me?

ROBERT BLOOMFIELD: Oh, I think you're back.

JESSE SCHELL: I'm back. You can hear me okay? I apologize for that. I have a brand new
laptop, and it decided it was going to sleep because I haven't touched it enough.

ROBERT BLOOMFIELD: Okay. That happens. Why don't you start that answer over again.

JESSE SCHELL: What in the world was I talking about?

ROBERT BLOOMFIELD: Well, I was asking you why it is that FarmVille became such a
game-changer now.

JESSE SCHELL: Oh, right, right.

ROBERT BLOOMFIELD: And you basically said, last I heard you were saying, it took Facebook
not just to exist, but to be popular.

JESSE SCHELL: You needed that. I don't know. The phone company people have used the
phrase "network externalities" for years and years. You had to have a system where the
network externalities had been overcome, and that's what had happened. So suddenly we had
a situation where people could easily create experiences that tapped into the real people that
you knew, and then, on top of that, they could easily bill you small amounts of money right along
with that. And then you also knew the system where you could easily advertise these games to
people. That suddenly all became possible about a year ago. And so in the past year we've
seen a huge explosion in this area.

ROBERT BLOOMFIELD: I should point out Troy McLuhan observes that even your laptop is a
game of "keep awake."

JESSE SCHELL: Yeah, right. And I lose.

ROBERT BLOOMFIELD: Let's talk a little about hardware. Gaming used to be all about PCs
and then consoles and now mobile. How would you describe the current state of hardware
devices for games, and what do you see coming next?
JESSE SCHELL: Well, it's a really interesting time we have right now because, for the longest
time, we've been going through generations and generations of game-console hardware and
the improvements were all about graphics. What happened in our current generation is
suddenly it wasn't about graphics anymore. Right now the system with the most powerful
graphics, the PlayStation 3, is the loser. And the ones that are winning, the number one being
the Wii, and it's partly winning because it's got a good price, and it's got a new kind of game play
that lots more people want to play than the traditional game system.

And then number two is the Xbox, and what's its advantage? I think its advantage probable is
the networking. And so it's got these sort of social connotations. This has been so different for
the game industry that everything's kind of stopped. Normally a new game console comes out
every five years, and nobody's talking about releasing another game console anytime soon
even though, by the old system, we would be due. Everyone's figuring out, "Well, my gosh,
what's the right thing to do in this new world if graphics don't matter anymore?"
ROBERT BLOOMFIELD: I'm glad graphics don't matter because, in fact, you have partially

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crashed in Second Life, and our viewers are hearing your voice, but staring at an empty chair,
which is one of those--
JESSE SCHELL: That's very sad because I'm looking at a blank screen over here.

ROBERT BLOOMFIELD: So what I'd like to ask you to do, let's see, because your voice will
probably crash momentarily anyway. If you will just close Second Life. Open again. We will get
you seated--

JESSE SCHELL: I will be back in a moment.

ROBERT BLOOMFIELD: --and probably will just take a couple minutes. Let's see. That gives
me dead air if I don't talk. There are so many comments here that you guys are reading. I didn't
expect to see this much activity. This is great. But one thing I wanted to read: This is
annGPOnTheWeb points out, "Perhaps I misinterpreted the comment about more openness
about oneself creating greater honesty, but more openness does not create greater honesty.
Monitoring does not create true honesty. What it creates is tremendous job stress, loss of desire
for creativity, loss of trust in those in supervisory positions. The farm game smacks of spy
tactics under Hitler's rule, neighbor on neighbor. What about games that end with the winner
being a rescuer with honor?"

I actually tend to agree with a lot of that, as an academic who has done some research and
reviewed a lot of research on basically trust in monitoring. I mean I studied managerial
accounting, and so the question is, I always ask my students, "Look. If you really want to know
what workers are doing, you can give them the chip implants in there so that you know exactly
where they are in the factory and how long they're in the bathroom and what they're actually
doing in there. It turns out it's not a great management technique. And so I do think it's a very
interesting question.

Just to refer to another show that we had last December, I think it was actually the last show of
last season, where we had Byron Reeves, from Stanford, who is looking at integrating games
into the workplace. And so do you want to have a leaderboard for your call center operators? Do
you want to be giving everyone instant feedback on their screen when they make a sale, and
you give them a little animated animal or something like that? Feedback is good, but it certainly
does raise a lot of concerns. And, as annGPOnTheWeb points out, people who comply with
monitoring it's not that they enjoy it, even if they do what you want. So, Jesse, do we have you
back?

JESSE SCHELL: Yes, you do. I hear two of you.
ROBERT BLOOMFIELD: Oh, okay. If you look in the top right of your screen, you'll see a little
Pause button, and I think, if you click that, you'll probably hear only one of me.

JESSE SCHELL: Oh, now that's way better.

ROBERT BLOOMFIELD: Yeah, one of me is usually enough. Let me know if you're settled and
ready.

JESSE SCHELL: Yeah, I think I am. My apologies for that. My old laptop would not run Second
Life so I got this new one, and I didn't realize that it was set to go to sleep after a half hour.

ROBERT BLOOMFIELD: So you have to move your finger on that mouse pad a little bit. We
were talking about hardware, and I'd like to hand some of your words back to you

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[INAUDIBLE/FADED OUT] and have you comment now a couple weeks later. You said,
"Everybody hates the iPad. It's a giant Swiss Army knife that doesn't fit in your pocket." Now
sales have surpassed projections, as I understand it. You still stick by your comment?

JESSE SCHELL: Well, I made the comment in February when everyone did hate the iPad. And
now I don't know. Like I'd mentioned yesterday, I loved the comments Seth Meyers had on
Saturday Night Live, "They sold 350,000 iPads the first weekend, ushering in a new era of
people buying things to find out what they are." And so at this point, I think it's still a little
undecided how people feel about this thing.

ROBERT BLOOMFIELD: Saturday Night Live is still funny. I'm glad to hear it.

JESSE SCHELL: You got a mind for it, but, yeah.

ROBERT BLOOMFIELD: Maybe for those who haven't seen the video, can you explain the
"Swiss Army knife" comment? Just to explain the context.

JESSE SCHELL: Sure. The simple idea is that the example I was talking about there was the
people misunderstand about technical convergence and technical divergence. And generally
everyone assumes that technologies are going to converge, that everything is going to end up
on one box, but that isn't how things happen with technology. Things start out converged. Just
like when motors were first invented, people would have one motor in their house, and they'd
connect it up to an electric fan, and they'd connect it up to a food processor, and they'd make
this one motor do all kinds of jobs. But nowadays, we have hundreds of motors in our house,
one little motor in every little situation.

And the same thing with technology. I told you, in the talk, I spoke about the pocket exception.
You say, "Wait a minute. I got an iPhone, and my iPhone has games, and it's got a camera, and
it's a telephone. That's technological convergence." But something magical seems to happen
inside people's pockets, and we've seen this before with the Swiss Army knife. Right? The
Swiss Army knife, it's got all kinds of convergence: scissors and a fork and a corkscrew.

But if I bought you one for your kitchen, you'd be mad. You'd think that was stupid because it's
awkward. It's hard to clean, and it only does one thing at a time. The iPad has some of those
same situations. It can, more or less, only do one thing at a time right now, and what's it for is
the question. It's not obvious what it's for, and I think that’s a little dangerous. You come out with
the iPhone, it's like, well, it's a phone, and it does other stuff. Well, the iPad, like, well, what is it?
Is it a pad? Can I write on it? No, it doesn't have a stylus. Oh, is it some kind of
video-conference device? No, it doesn't have a camera. Is it an e-Reader? It could be an
e-Reader, but that's not what it's really for. Well, what's it really for? No one's quite sure.

So my suspicion is, people will figure out the things that it's good for, but it's not clear because
there's so many things about it that are mysterious. You say, "Oh, well, it's like a laptop, but it's
more portable." "Oh, so you mean I can type on it while I'm walking around?" "Well, sort of. You
got to kind of put it on a table to type on it really." "Oh, like a laptop." "Well, yeah, but." So
people are still figuring out, I think, what it's for.

ROBERT BLOOMFIELD: Yeah. We have a question here from Mystical Demina asking, "What
is the difference between what people do in corporations and what they do in games? Isn't
everything really a game?" So I'd like to use that as a springboard to talk a little bit about your
book The Art of Game Design. And, for starters, you have done more than just computer

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games, even though that's largely the topic of the day. Could you just give us an introduction to
how to think about games at the broadest level?

JESSE SCHELL: Yeah. The premise of The Art of Game Design book that I did, the reason I
call it The Art of Game Design a book of lenses is because good game design happens by
viewing your game from many different perspectives. And, in the book, I try and call out, "Well,
what are these perspectives?" And, in the book, I call out 100 different perspectives by which
you might look at your game, and what these really are, are short lists of questions that you
should ask yourself about your game. Because if you can kind of put a game together and you
look at it from a hundred points of view and it looks good from all of them, this is probably a
pretty good game. So that's sort of the fundamental idea and premise of the book. And these
techniques largely are independent of technology. They work more or less just as well with a
board game as they do with a computer game.

ROBERT BLOOMFIELD: You worked on theme park rides. Am I understanding that right, you
actually worked on rides and attractions?

JESSE SCHELL: Yes, I still do too.

ROBERT BLOOMFIELD: What is the difference between working on that and working on a
computer game, a traditional game? Similarities I can see, but there must be some pretty big
differences.

JESSE SCHELL: The differences end up being kind of just small things in the details, really. In
all these cases, you have some experience that you're hoping to create. You're trying to figure
out who it's for. You're trying to make it as engaging as possible. One of the things that's really
different with theme park rides--and I've done some interactive theme park rides: Toy Store
Mania was one of the ones my studio did a lot of work on--you have such a short time. You
have a five-minute period for people to be completely engaged with this, and they may have
waited an hour in line for your five-minute experience. So by that point, the bar is pretty high.
You can't have a situation where they don't understand what to do, or, if they don't move the
mouse, that the whole thing crashes.

It just has to work, and a lot of that comes from testing and testing and testing and testing. But,
really, how different is that from a lot of game experiences that get created? I guess I'm just
going to say it's not that different. You're talking about virtual environments and fantasy worlds
and entertaining experiences that people enjoy.

ROBERT BLOOMFIELD: Interesting. I think it's fairly early on in the book you talk about some
of the problems that games can have. Problem number four is Not Enough Verbs, and let me
just read quickly. You say, "The things that video game characters spend their time doing are
very different from the things that characters in movies and books spend their time doing. Video
game verbs are: run, shoot, jump, climb, throw, cast, punch and fly. Movie verbs: talk, ask,
negotiate, convince, argue, shout, plead, complain." And you say basically that, I think I have
this phrase right, that, "Computer games aren't very good for action that takes place above the
neck."

JESSE SCHELL: Right.

ROBERT BLOOMFIELD: Do you see that changing?

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JESSE SCHELL: Yes, I think it will change. Chris Swain, who's a professor at USC, I think he
called it, and I think he's got it exactly, exactly right. The analogy he draws is to cinema. When
we look at the history of cinema, before movies could talk, when we just had silent films, sound
films were not taken very seriously. They were considered kind of a novelty, and they were kind
of interesting and an amusement. And there was a small number of people who saw them as an
art form, but largely it was like, "Well, this is so inferior to real theatre and to real acting and to
real storytelling." Most people just didn't think much of it. But, as soon as those things could talk,
everything changed.
And once they could talk, suddenly film went from being kind of an obscure, amusing
entertainment novelty, it became the literature of the twentieth century. It became the most
powerful, the strongest cultural force. For many people the most powerful, emotional
experiences they've had involving a story have been from a film because it's just that powerful.
What Chris Swain suggests is that games are in a similar position, but, of course, games can
talk. We hear characters in games talk all the time. But what games cannot do right now is, they
cannot listen.

If I speak to characters in a video game, for the most part, they're unable to tell what I'm saying
and unable to behave in, you know; I can't have a conversation with a video game character,
but you will be able to. The technologies are creeping along, and we're going to get there.
[AUDIO GLITCH] happens [AUDIO GLITCH] are like, "Yeah, that'll probably be solid in maybe, I
don't know, 2025, 2030." I think 2030 is a more realistic time for that. But once that happens,
then games will become the dominant form of literature, the dominant art form, the dominant
mode of cultural expression in humanity.

ROBERT BLOOMFIELD: Your audio broke up for a second there. We heard everything that
you said, but people are suggesting you maybe caress your laptop a little bit, give it some life.

JESSE SCHELL: Maybe that's a good idea.

ROBERT BLOOMFIELD: You talked a little bit about lenses, the different lenses. Can you give
us an example or two?

JESSE SCHELL: Oh, sure. So a good lens, for example, would be the lens of the toy. We're all
so used to thinking of games with, you know, games have goals and games have challenges,
but we don't often think about them from the perspective of a toy. And the difference between a
game and a toy is, a game has a goal. A toy doesn't necessarily have a goal. A toy you see,
and you're like, "Wow! I just want to play with that. I just want to pick it up and touch and handle
it and kind of see what it does."

When you're designing a game, it often makes sense to think about, "Well, what's the toy at the
center of this? How can I make this something that, even though people don't know why they're
doing it or what to do, they want to just pick it up and do it?" Rubric's Cube was a really great
example of that. Sure, it's a game. It's got a goal. It's got a challenge. But people just want to
pick it up and twist it and kind of see what that feels like to do.

ROBERT BLOOMFIELD: I'd like to talk a little bit about serious games. By serious games, I
mean games that are--the intention is not fun. The intention is, in education, it's to get people to
achieve certain learning goals. And, in research, let me use an example of my own situation. I
conduct research on financial market regulation. And this is what I've done for 20 years
basically is, I create very small games in the economics definition of a game, where you have
players who can take actions, and it affects payoffs and so on and so forth. And so I'll create

12

two games that capture elements of financial markets, one with this regulation and one with that
regulation, and we see the effect of the regulation. What I'm wondering, what different things do
you need to apply to the art of game design if you're goal is not fun, but it's either education or
research?
JESSE SCHELL: Well, I think fundamentally, the most important thing with any kind of
educational game is to know what its purpose is. What is the goal you, as the designer, have in
creating this experience? And that's sounds simple and straightforward, but I'm always shocked
when I talk to people involved in education, where I ask them, "How is it that you want to
change people? People come in to your class, and you want them to leave different. What is
going to be different about them?" And very often they say, "Oh, well, I just want them to know
these facts." It's like that's it. Just these facts? Or do you need them to have a new perspective?
Or do you need them to have mastered a certain skill or to be able to ask certain questions or to
solve certain problems?

It's important to be very specific about exactly what is it that my educational game is meant to
achieve, and then you design everything in your game around that purpose. And so, in a lot of
ways, it's no different than creating a regular game because we often say we want our game to
be fun, but that's not always true. Very often it's not so important that the game be fun, it's
important that a game be engaging. And engaging and fun are not always the same thing.
Anyway, regardless, you want to know what your client is--

ROBERT BLOOMFIELD: Can you elaborate on that? How do you go about engaging people in
a way that's not fun?

JESSE SCHELL: Okay. Think of someone who joins a swim team. Right? Now is swimming
fun? People say sure swimming is fun. Is competitive swimming fun? No. Most people would not
say that competitive swimming is fun. Is it a game? Well, we get together and someone wins
and someone loses, and, yeah, it's a game. It's just not a fun game. Is it an engaging game?
Yes. They think hard about how they're going to master it and how they're going to get better at
it. And they come up with strategies and execute the strategies.

A very interesting thing to look at, there's a group in [Flora’s?] Immersive--and they're
consultants, and they have written some excellent papers about the nature of game psychology.
They speak of the PENS model of engagement, P E N S. And they talk about the different
factors that kind of lead to engagement. They've done psychological tests where they measure
the fun in a game versus measuring sort of these other aspects of engagement. And it turns out
fun is worth something, but it's not really the key driver. The things that lead to people being
truly engaged in an experience are when people really say, "Yeah, this is a game I want to play
some more."
And it's funny, one of the things I've been thinking about lately: People criticize FarmVille
because they say, "FarmVille's ridiculous. People are compelled to play it, even though it's not
actually fun." And, in a lot of ways, FarmVille ends up having more in common with a sport, with
playing organized sports, than it does playing traditional video games. Because people playing
organized sports, they seldom say, "Oh, I can't wait. I'm going to go play it. It's so fun." They
say, "No, I signed up. I said I'm going to do it so I'm going to do it. I don't want to let the team
down. It's important that we win. It's important that we do this." So they have social obligation.
They have a time-based obligation. They want their status to be higher in the eyes of others,
and that's often a driver for people doing these things. And it’s the same thing with FarmVille.
So there's some interesting connections here; new ways to think about things.

ROBERT BLOOMFIELD: Definitely. Moving on just directly to education, I noticed in the video

13

of your DICE talk, you're very straightforward, and you pointed out that, "In our education
system, grading systems suck." And you talked about Lee Sheldon, at the University of Indiana,
who is actually adding game elements to the classroom. What do you see as the future of
games and gaming elements in education?
JESSE SCHELL: Well, I think we're going to see a massive revolution in education. That's
going to be driven by a few different things. One of them is, partly it's driven by the internet.
People now have access to so much information they didn't have before, and that changes the
nature of education. In other words, if you would like to become self-educated about some
specific topic, it's much easier to do that than ever before. And secondly, getting access to
experts is so much easier than it's ever been in the past. You might say, "Oh, aren't the experts
going to be overwhelmed?" But people talk about the long-tail concept, right, the long tail of
books and videos and that sort of thing.

In other words, that there's a huge amount of things that they're of interest to a small number of
people so that when you look at what Barnes & Noble sells in their bookstores versus what
Amazon has online, some huge percentage of what Amazon sells is not available in any
bookstore anywhere, and that's the long tail. Well, we have the long tail of experts too.
Somewhere in the world there's someone who's really excited about how do you make your own
surfboard out of a baobab tree. And somewhere else in the world is the world's leading expert
on that. And now, with the internet, those two people can find each other. Why do you need a
teacher in the way to kind of help with that?
So self-education is going to be a huge part of this revolution, and games are going to be an
important part of that because games work really well with self-education because they permit
you to learn at your own pace, and they permit you to kind of immerse yourself into situations
that you can't do just by reading or just by thinking. You have to kind of get in there and do
things.
ROBERT BLOOMFIELD: We're getting on toward the end of the hour, and I've got just a couple
more questions. One of them is: What can you tell us about some games currently in
development at your shop?

JESSE SCHELL: Oh, man! Let's see. A lot of the games in development at my shop,
unfortunately, I cannot talk about.

ROBERT BLOOMFIELD: That's what I was afraid of. [CROSSTALK]

JESSE SCHELL: I'm trying to think if there's any I can talk about. No, not that one. Here, I'll
speak generally, and that might work. Because we're doing so many different kinds of things at
our shop now. There's been a big change. We used to do a small number of big projects. Now
we do lots and lots of different projects. So we're doing a mix of interacting theme park rides,
massively multiplayer games. We're also doing some Facebook games, and some of them are
3D games on Facebook, which is sort of something new, kind of how do you connect Unity into
Facebook.

On top of that, another thing we're working with a lot is toys and toy lines. People are familiar
with Webkinz and how Webkinz has an online component. There are so many opportunities
now to plug your toys right into the computer, through the USB port, so that you can upload
content to the internet and download content from the internet to your toys. And we're doing
some work in that direction. So there's a lot of things going on here. It's hard for me to even
keep track.

ROBERT BLOOMFIELD: Okay. Let me as you another question, related: What are your

14

favorite games?

JESSE SCHELL: Oh, okay. I'm just going to give you my honest answer. I'll tell you my favorite
video game of all time is a ridiculous game. It's for the Nintendo 64. It's called Blast Corps. And
the whole concept of Blast Corps is, there's a truck with a nuclear bomb on it, that has somehow
become armed. And the truck, it's brakes have failed, and it's heading at this town, and the
driver has abandoned the truck. And the city's been evacuated. It's now you and this truck and
this town, and you have to get everything out of the truck's way. It is such a ridiculous game
because you drive like 20 kinds of vehicles. You've got to, oh, my god! get in the taxicab and
driver over to the train so you can move the bulldozer so that you can knock down the building
so that you can get inside and get the giant robot and knock down the rest of the buildings and
clear a path for this truck. For some reason, it was a game that I just became completely
addicted to. I guess it's kind of a dumb story, but the reason I like to mention is, I find it so
interesting how it's like different games speak to different people in different ways.

ROBERT BLOOMFIELD: Are you saying that sounds like your job?

JESSE SCHELL: Yeah. It's just interesting to me how there's games, like for example, Braid, in
terms of more modern games. I think Braid, in terms of artistic achievements in games, it's the
most powerful game involving an artistic statement I've ever seen. And there are other people
who are like, "Oh, my god, that was a piece of garbage. I hated it." I become fascinated how
personal the game-play experience is for people.

ROBERT BLOOMFIELD: Well, what does it say about me that I loved Scarab of Ra when I was
a kid. When I was a kid? When I was a doctoral student. Okay. Well, I guess we are basically at
the end of our hour. I really appreciate your coming on to join us today, Jesse Schell, from
Schell Games and Carnegie Mellon University. I hope maybe we'll see you back here.

JESSE SCHELL: All right. Yeah, I hope so. Thanks very much for having me.
ROBERT BLOOMFIELD: My pleasure. Thank you very much. I guess this is the end of the
season for Metanomics. What is it? It's late April now. I've got a lot of stuff going on in the next
few weeks so we'll have to sort out and see when we're going to pick up again. I would like now
to encourage Jennette--we will, even though the show won't be in session, we will have a lot of
events going on. We'll have our Thursday forums and stuff like that so I would encourage you to
join the Metanomics group in Second Life. If you are full of groups, we now have a technology
that will allow you to subscribe to all the messages and notices, and Jennette Forager, I'm
hoping, will be pasting information on how to do that any moment now.

The end of the show is usually when we Connect The Dots. I don't have a whole lot to say to
connect the dots because I think Jesse did such a great job. And I would just like to point out
that, toward the end of last season, we also had a show with a very similar theme. We weren't
calling it Gamepocalypse, but it was about integrating game content and game features with
Real World activities. That was more focused on enterprise use in the business, whereas, this is
more bringing business models and business incentives into games that companies are trying to
profit from as they give their players fun, or, if not fun, engagement. So there's a common theme
there, and I think it's going to be a recurring theme in Metanomics. I hope you'll join us next
season, and we'll be announcing our guests and our schedule in the coming weeks.

So thanks a lot. And, bye bye.
Document: cor1085.doc
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Metanomics transcript april 21 2010