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Hi Everyone. Welcome back to Master the Meta. Last sunday’s most popular links included: Out of Scope’s piece on A Map of The Metaverse, The Verge’s coverage of the Twitch leaks, and Mobile Dev Memo’s work on the Diseconomics of Mobile Advertising. Let’s dive into today’s issue.

From the Archives: In Conversation with Josh Williams, CEO at Forte

A few months ago recently had the pleasure of interviewing Josh Williams, CEO of Forte. Forte is building end-to-end infrastructure solutions that enable game developers to more easily build, launch, and manage blockchain games. In our conversation with Josh, we discussed why blockchain games matter, how Forte works, the company’s vision and plans for the future, and best practices for designing blockchain games. Check out the transcript or audio-only version of the interview below!

#1: AppLovin Acquires MoPub for $1B

US-based mobile gaming and monetization company AppLovin announced it would acquire MoPub from Twitter for $1.05B. Founded in 2010, mobile monetization platform MoPub boosts the efficiency of the advertisement campaigns of its clients. In 2013, the company was purchased by Twitter for $350M. Currently, MoPub software is used by 45,000 mobile apps and covers 1.5 billion mobile users around the globe. In 2020, MoPub generated $188M of revenue, which brings us to the 5.6x EV/Revenue transaction multiple.

The MoPub platform has a wide selection of different features, including its own Ad Exchange platform with a number of programmatic partners. But what separates MoPub from the rest of the market is its particular distance from the gaming market: though large gaming companies like Voodoo, Playgendary, or Playrix actively use MoPub services, it’s one of the few ad monetization companies not affiliated with gaming businesses directly (AppLovin or ironSource, for example, have their own gaming divisions).

This independence is one of the selling points for MoPub — many publishers that don’t want to use the services of their competitors use MoPub instead. As a result, MoPub gained access to a variety of unique user database and became one of the largest data sources, which now supplies such ads companies as Liftoff and Moloco. Combine this with AppLovin’s existing data from its AppLovin MAX ads monetization platform and its LionStudios hypercasual division — and we get the company that knows almost everything there is to know about ad monetization. Notably, with the acquisition, AppLovin has even more knowledge about the ads market, and increases the volume of its data chest. As for in-app monetization, the $1B acquisition of Adjust closed in April 2021 significantly strengthened the company’s position in this area as well. However, the competition there is much stronger, considering that the main Adjust competitors have already been consolidated: Unity has DeltaDNA, Mintegral has GameAnalytics, and Google has Google Firebase.

As we described earlier, AppLovin is primarily a gaming business, with mobile games accounting for 85.8% of wales. The expansion of AppLovin’s gaming service was heavily supported by the M&A activity of the company: Belka Games, Geewa, Redemption Games, and Machine Zone are among its major gaming acquisitions. Thus, increasing its mobile marketing and monetization capabilities, AppLovin becomes an even more attractive strategic investor for mobile gaming companies.

The ads monetization segment (pretty much aligning with the gaming industry as a whole) is becoming more and more consolidated, and we are yet to see the profound changes this brings to the market. For now, we see a clear trend — along with the diversification of their gaming portfolio, many gaming companies are starting to reinforce their marketing, monetization and analytics capabilities. As AppStore and Google Play continue tightening their policies, scaling and monetization expertise becomes even more important than ever before. (Written by InvestGame)

#2: Artificial Intelligence & NFTs

The history of artificial intelligence (AI) is inextricably intertwined with that of game development. From primitive chess and checkers AI programs built on the earliest commercial computers to the more recent forays of Google’s AlphaStar and AlphaGo initiatives, artificial intelligence has grown in complexity alongside game development. AI has also been a key tool in refining and operating games, helping to fill matchmaking lobbies and find bugs.

As we enter what may be an entirely new era of gaming with the emergence of blockchain-based games, AI will likely continue to play a key role in game development. A new crop of companies is springing up to combine AIs with non-fungible tokens (NFTs) on the blockchain, enabling entirely new experiences heretofore unseen in the industry.

One such example is Alethea AI. The company claims to have created the world’s first intelligent NFT, or “iNFT,” powered by the GPT-3 neural network machine learning model. Alethea’s iNFTs are fully interactive and can be trained to “upgrade” their intelligence. Its “Alice” iNFT (referencing Lewis Carrol’s novel Alice in Wonderland) sold for nearly $480,000 in a Sotheby’s auction. Additionally, the company recently raised $16M in a private token sale from the likes of BITKRAFT Ventures, Shark Tank co-host and serial entrepreneur Mark Cuban, and NBA Top Shot creator Dapper Labs, among others. Capitalizing on this recent momentum, the company is soon to debut its “Noah’s Ark”, containing a variety of iNFT personalities, from historical figures (Napoleon, Julius Caesar) to crypto “personalities” (Bored Ape 7065, Pudgy Penguin 2197) and fictional characters (Aladdin, Zeus).

Another innovator in this space is Altered State Machine (ASM), a company creating NFTs that prove ownership of an AI “agent”. This NFT is able to alter the way the agent learns about new problems, changing its outputs in unique ways based upon the specific use case. These use cases can vary widely, ranging from DeFi to DAO governance, but for gaming specifically, the potential is fascinating. ASM’s AIs could, for example, complete tasks for you, act as companions or helpers, or remember their interactions with you or others over time. The AI agents could even pass on their learned traits to child AIs. While these examples only scratch the surface, Altered State Machine is seeking to open people’s eyes to the possibilities with their own play-to-earn title, Artificial Intelligence Football Association (AIFA). In AIFA, players create, train, and play an entire team of AIs. Importantly, the AI agent acts as the “brain” of the team, while four “All-Stars” act as the on-field visual representation of the AI agent, with each of the five entities (four All-Stars + one AI agent) existing on the blockchain as NFTs.

The applications that these and other innovative AI companies could bring to the games industry are mind-blowing. Imagine interacting with your stable of Axies or Pokemon, each with its own unique personality. NPCs in MMORPGs could change from simply repeating the same few lines of dialogue over and over to reflecting back to players the interactions they have had with others before them. Those NPCs could even have children or relatives that share similar personalities, all based upon player inputs. Owned AI NFTs could even be brought into multiple games, sharded and/or upgraded in a variety of ways...at least, in theory. While there is likely still a long way to go before these sorts of utility are realized, I believe that it is a space worth watching for game developers, crypto enthusiasts, and players alike. (Written by Matt Dion, Sr. Product Manager at EA)

📚 Content Worth Consuming

How to Evaluate Mobile Game Ideas (EGD): “We often hear this question coming up: “how should I evaluate the viability of a game idea as I’m starting to work on one?” It’s an essential question since you don’t want to end up spending several months developing something that won’t work. And the worst thing about building a game without any early validation is that you often don’t understand why it’s not working when the game is ready. Many developers are clueless about the bad performance of their game, you see Day-1 at 20%, and you just shrug your shoulders and move on to the next game.” Link

The Future of Social Gaming (Two separate interviews with Justin Waldron on Invest Like the Best & DoF): “Justin Waldron is the co-founder and President of Playco. We cover how Justin sees the future of gaming as social platforms evolve, how gaming may be the next tool for content creation, and how Playco has approached aligning incentives for game creators and players.” Invest Like The Best | DoF

Gaming is Coming To Get Us (Marginal Revolution): “The self-contained nature of games also means they will be breaking down government regulation. Plenty of trading already takes place in games — involving currencies, markets, prices and contracts. Game creators and players set and enforce the rules, and it is harder for government regulators to play a central role. The lesson is clear: If you wish to create a new economic institution, put it inside a game. Or how about an app that gamifies share trading? Do you wish to experiment with a new kind of stock exchange or security outside the purview of traditional government regulation? Try the world of gaming, perhaps combined with crypto, and eventually your “game” just might influence events in the real world.” Link

How Virtual Worlds Will Work Part Two (Raph Koster): “There are a lot of things people assume they want out of a metaverse which don’t really hold up under close scrutiny. Do you really want to move your avatar between a fantasy world and a gritty noir world set in the Prohibition era? Even if it shatters all immersion when you head into a speakeasy and someone casts a fireball spell at you?… You get the idea. It’s quite easy to arrive at poor architecture decisions because you’re chasing technical dreams that don’t hold up to what users actually want. Above all, we should never forget that the metaverse is for people, because all technology is for people.” Link

🔥 Featured Jobs

• Mythical Games: Principal Economy Designer (Remote, US)

• Immutable: BD Exec, Gaming (Remote, US/EU)

• Mythical Games: Lead Product Manger (SF, LA, Seattle)

You can view our entire job board — all of the open roles, as well as the ability to post new roles — below.

Thanks for reading, and see you next week! As always, if you have feedback let us know here.