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Will the gaming industry clutch up in 2019? – TechCrunch

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2019 promises to be a great year in games. Innovation and competition will elevate the industry’s offerings and drive more inclusivity among a broader range of audiences.

Cloud gaming emerges as the new frontier and brings about unlikely partnerships.

Collectively, gamers will serve as the canary in the coal mine as large tech companies look to introduce new technologies to mainstream consumer audiences. Companies like Amazon, Tencent, Google and Microsoft already own and operate massive data centers that virtually run enterprise applications. In 2019, we will see continued investment in infrastructure and content acquisition as these billion-dollar companies seek to claim the consumer market.

Cloud gaming is a massive market opportunity that extends beyond just interactive entertainment. Microsoft already generates significant revenues from cloud-based services, and doubling down on gaming will open the door to broader adoption by consumers and a bigger piece of the market.

It also comes with significant competition, each player with their own motivations. Tencent, for one, got hit hard with a slowdown in mobile game approvals by the Chinese government, causing its share price to drop. Since then, things have started to improve somewhat, but it has incentivized Tencent to reduce its exposure in gaming and look for other non-content business segments that generate steady revenue and require less government regulation. For the first three quarters of 2018, Tencent’s cloud operations generated $864 million (RMB 6 billion) in revenues and more than doubled year-over-year.

Google has also been trying to wiggle its way into the cloud gaming business. Its cloud operations make about $10 billion annually, and recently appointed a new CEO likely to expand Google Cloud’s vertical product capabilities in non-tech categories.

And there is, of course, Amazon. With currently more than 50 percent market share in cloud computing and a strong user acquisition and engagement channel with Twitch, Amazon is uniquely positioned. But its previous efforts around interactive entertainment have so far not produced any real tangible results despite it ramping up expenditure. This makes it more likely that Amazon will become a third-party infrastructure provider for companies like Sony and Nintendo instead.

As these titans double down on cloud gaming initiatives, we can expect to see some surprising partnerships. For instance, Tencent and Google are currently working together in China. This gives the latter an entry point into a market that has long been out of reach. Meanwhile, incumbents like Sony, Nintendo and legacy game publishers will have to decide on going at it alone, as is the case of Electronic Arts, or buddying up and surrendering a piece of revenue.

Gamers win as the PC games market breaks into pieces.

It’s not a bad thing. But after more than a decade of a virtual monopoly held by Valve, new contenders have emerged. We already saw how Valve tried to get in front of Epic’s announcement that it was lowering its platform fees. And not long after, Discord popped up with an even better rate.

Breaking with the standard 30 percent cut, which is what most platforms (Apple, Facebook) claim in exchange for their services, Valve announced a few major changes. Two key sentences from the announcement. First, Valve’s new revenue distribution: “when a game makes over $10 million on Steam, the revenue share for that application will adjust to 75%/25% on earnings beyond $10M. At $50 million, the revenue share will adjust to 80%/20% on earnings beyond $50M.” Succinctly, make more and keep more.

Part of what is driving this is consolidation at the top. In the PC market the top-line firms have been growing at an incredible rate. Between 2013 and 2017, Activision grew its PC operations at +10 percent compound annual growth rate. EA’s was +30 percent, and Bethesda’s +36 percent. Meanwhile, the share of the top four public companies, based on PC gaming revenue, grew from 44 percent to 60 percent in that same period. It’s getting less crowded at the top and digital stores will have to compete.

The big publishers like Activision, Ubisoft and EA already have their digital storefronts and distribution platforms. Different from the brick-and-mortar space, publishers managed to build their own rather than rely on third-parties. For years, the big guys have had no interest in putting their content side-by-side with a growing number of small and medium-sized game companies.

Epic’s wild success with Fortnite has afforded it a much broader range of strategic options. So far it has lowered its store fees and retroactively paid developers on its platform. And now it is budding into the digital PC market by using its vast financial resources to compete head-on with Valve. Finally, Discord’s entry should be noted, too. Adding a content offering to an existing community, rather than the other way around, Discord is the new hot thing. Certainly, it has yet to lay claim to a hit title of its own. But it has both the expertise and critical mass to become an important next store front. It raised an additional $150 million right before the holidays.

All this takes place against the backdrop of a declining physical games market. It’s been a tough few months in meat space. In its recent earnings, GameStop came in at $2.08 billion and +4.8 percent in global sales, but Wall Street was not impressed. GameStop blamed Call of Duty and “sports titles.” With the recent sell-off of Spring Mobile to lower its debt, the specialty retailer continues on the hunt for new leadership, either in the form of a new CEO (unlikely) or new owner (likely). Whoever is going to scoop up GameStop is probably waiting for 19Q1 when sales dip and its valuation will be lower.

The breaking up of Valve’s dominance is good for players and companies that make games. Consumers will get better prices and more choice, and the various digital stores will compete over functionality and improved user experience. This is a win-win for all.

Walled gardens will be broken down, enabling cross-platform play with anyone, anywhere.

Despite digitization, the bulk of interactive entertainment has remained within one of the various walled gardens. That is going to change. Like telecom networks that allow people to speak to each other irrespective of their phone provider, so, too, will online gaming break down silos. In 2019, cross-platform play will become ubiquitous. The end of 2018 has already shown the potential of this as Fortnite’s success resulted in each of the platforms agreeing to play nicely with one another.

Legacy publishers like Activision Blizzard have also tasted what cross-platform play can do for their franchises: Hearthstone has continued to dominate the collective card game category, because it works seamlessly across PC and mobile, and offers a smooth integration with live-streaming platforms like Twitch.

Cross-platform play should be at the top of every studio’s design agenda in 2019.

Subscriptions and bundled content will drive sales in 2019.

After seeing the initial success with subscriptions enjoyed by Twitch and Microsoft’s GamePass, more companies will adopt this monetization model. Large platform holders like Sony and Apple are looking to grow their revenues by offering content subscriptions. Both of these companies have indicated they have plans to increase services revenue as a direct response to reaching the limit of how much hardware they can sell.

Game publishers have been experimenting with micro-transactions to great success. Tentpole franchises like FIFA, Hearthstone and GTA V Online have made a mint from what they call “recurrent revenues.” Beyond up-selling their audiences on a regular schedule with content updates, they will explore subscription models that will provide massive discounts and unique content to players in exchange for a more predictable revenue flows.

Video games will face more and new regulation with a focus on kids.

Now that gaming has emerged as a mainstream form of entertainment, the industry can expect more scrutiny. In addition, there will be sharper focus on kids and technology in 2019. Data companies will be increasingly under the microscope. Similar to the loot box scandal that resulted in various governments speaking out, we will see an effort focused on protecting children. This means that game companies will be held to a higher standard with regards to how they handle data on minors. Against the background of a festering trade war between eastern and western economies, data ownership, in particular around children, will emerge as a political topic and strategic business challenge.

It also means that titles like Fortnite will be fingered as culprits in narratives around an erosion of culture and well-being (although this is largely driven by misinformed industry critics). The title’s appeal to younger audiences will make it a likely scapegoat as the usual choir sings its disdain for video games. This year’s congressional hearing in the U.S. more than satisfied our need for examples of how disconnected government representatives are from technology used by literally everyone else. Different from previous generations, however, I expect the companies currently at the top of the food chain to know exactly how to respond. They will push titles that offer a safe, pleasant space for kids to play, uninterrupted by broader challenges found everywhere else.

Next year will, however, not be a continuation of exuberance as we’ve seen previously. Trends in related industries suggest that gaming, too, will move toward a more concentrated competitive landscape and closer government monitoring.

Image: Bryce Durbin/TechCrunch

Further consolidation is imminent for the games industry.

In response to the slowdown in consumer spending, some game companies will go out of business and others will gobble up the failing ones to strengthen their market positions. Nothing new here, but it does leave room for speculation as to who will buy whom. I previously speculated that Amazon would buy GameStop and still think they might. Only it will happen when GameStop reaches its wits end, probably at the end of Q1 2019.

Across Europe there have been a series of smaller acquisitions throughout the year, some of which are now turning sour. Starbreeze had its offices raided (which I’m told sounded worse than it was). Even so, this year the ambitious portfolio approach of buying up smaller studios and leveraging their IP against efficient distribution networks became, perhaps, too popular.

Finally, I expect companies like Tencent to continue satisfying their appetites for foreign assets. If nothing else, this year has cemented Tencent’s need to diversify as they look to mitigate some of its recent stresses by lowering its exposure to games revenue and further investing in western companies and platforms. Over the past two years its success with this strategy has greatly lowered competition across PC and mobile, the two most innovative categories.

This does not mean that innovation itself is at risk. It just means that the stakes will be higher for any firm that does not make a billion or more in revenues.

Courtesy of Feodora Chiosea/Getty Images

The coming winter brings a slowdown in growth, and possibly in revenue and innovation.

I’ve been writing about this for a while now. But don’t misunderstand: I want to be wrong about this. While I would like to predict that 2019 will bring even more growth and more money for everyone, the supporting evidence simply isn’t there.

For one, mobile gaming is showing saturation across different markets, including in China. It has evolved from insignificance to become the biggest games market worldwide and is now starting to slow. We are also at the end of the current console cycle. This simply means that the platforms are going to discount their hardware and the bulk of consumers looking to spend are disproportionately price conscious.

Overall economic indicators suggest that consumer spending, especially in the U.S., is headed to a slowdown. Following the tax breaks earlier in the year, overall spending surprised even the retailers. But that party is going to end soon. Finally, as gaming has become mainstream, its underlying economics have shifted. In broad terms this means that where previously the games industry may have seemed “counter-cyclical” it is going to follow suit with whatever happens to consumer spending at large. In addition, investors have become savvier and are starting to trade aggressively against game stocks. This means game companies are less inclined to take risks on content innovation (as in the case of EA).

The long-term silver lining here is that this imminent stagnation is the precursor of the industry’s overall transition. But before spring comes winter.

Live-streamers and influencers embark on a drama binge.

Yes, newfound fame will get the better of them and stupid things will be said. This is still the very first generation that suddenly finds itself thrust into the mainstream spotlight — they don’t have the benefit of the intense vetting that other industries have subjected their rising stars to before sending them on the main stage. With many still amateurs and competing against one another to win the favor of audiences and aggregators alike, the stakes are substantially higher.

In their hunger for attention, aspiring streamers will sacrifice their authenticity and some will undoubtedly ruin their careers before it even starts. Mounting pressures from growing competition will drive this new generation of tastemakers to “keep it real” and remain authentic. Twitch and YouTube will do what they can, I’m sure. But for many, this authenticity will be too much.

EA takes a hit in 2019.

Among the Big Three, Electronic Arts will have the toughest year. Despite its aggressive expansion effort illustrated by the acquisition of GameFly’s streaming division, EA is going to face the music with investors. This is somewhat undeserved, because financial investors insist on continual growth and generally can’t see past the next quarter. And, to be fair, EA has a few weaknesses: its revenue and its margin are highly dependent on the continuing success of FIFA Ultimate Team. In addition, it has relatively little new IP in the pipe, which makes it even more difficult for investors to care about the longer-term future. Simply put, EA can’t free itself from Wall Street’s needs as several analysts have already started to lower their expectations for the year ahead.

Photo courtesy/Getty Images/Guido Krzikowski/Bloomberg

GameStop sells, but it’s not a party.

I already predicted this last year and was almost right: GameStop has been trying to get acquired for the past six months. Its C-suite has seen better days, most recently resulting in a letter from one of its largest shareholders, Tiger Management, to get its sh!t together (aka perform a strategic review). The company has been unable to find a buyer and now finds itself forced to essentially abandon the diversification strategy it initiated in 2014 by acquiring retail chain in parallel market segments. Just recently GameStop sold off Spring Mobile and is likely to use the money to pay off its debts and improve the likelihood of some private equity firm or a company like Amazon to buy it. No one expected it to be a great year for games retail, but it’s getting sadder.

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Review: Fatman’s concept is better than its execution, but it’s still kinda fun

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Enlarge / Mel Gibson plays Chris Cringle, a disillusioned Christmas shopkeeper in North Peak, Alaska.

There’s a fine line between comedy and tragedy, which is why black comedy is a film genre that is notoriously tough to get right. Despite good performances and some nice moments, Fatman—in which Mel Gibson plays a gruff, grizzled, disillusioned Santa—doesn’t quite succeed tonally in finding that elusive sweet spot. The trailer was certainly promising, but the concept is better than the ultimate execution. That said, it’s still pretty entertaining, and a solid addition to the growing genre of what one might call “anti-holiday” films.

(Some spoilers below, but no major reveals.)

Written and directed by brothers Eshom and Ian Nelms (Small Town Crime), the film co-stars Walton Goggins (The Righteous Gemstones, Ant-Man and the Wasp) and Oscar-nominee Marianne Jean-Baptiste (Secrets and Lies, Blindspot). Per the official premise:

To save his declining business, Chris Cringle (Gibson), also known as Santa Claus, is forced into a partnership with the U.S. military. Making matters worse, Chris gets locked into a deadly battle of wits against a highly skilled assassin (Goggins), hired by a precocious 12-year-old after receiving a lump of coal in his stocking. ‘Tis the season for Fatman to get even, in the action-comedy that keeps on giving.

Chris and his wife, Ruth (Jean-Baptiste) run a Christmas present manufacturing operation in North Peak, Alaska, with the help of their workers (elves), led by the elfin factory foreman, Seven (Eric Woolfe). Apparently the US government pays Chris an annual subsidy to run the factory, since Christmas generates some $3 trillion a year in holiday spending.  But in recent years, so many children have made the naughty list—thereby meriting a lump of coal in lieu of a gift—that it’s significantly reduced the factory’s output, resulting in much smaller subsidies. Chris tries to find other clients, but “everybody is outsourcing,” and he keeps getting underbid. To save the factory, he accepts a one-time contract from the US military to manufacture control panels for a new jet fighter program.

Cut to Christmas morning, when young Billy (Chance Hurstfield, The Package, Good Boys) opens a gift from Santa, only to find a lump of coal inside. Billy is not amused. In fact, he is outraged to the point of hiring Goggins’ assassin, Jonathan Miller (aka Skinny Man), to kill Santa Claus, aka the titular Fatman.  But first, Miller has to figure out where Santa’s been holed up all these years.

This is not a film with many laugh-out-loud moments, or even hearty chuckles; it’s more likely to elicit wry appreciative grins. Tonally, it’s pretty dark, although the violence is largely off-camera until the climactic confrontation. The ultra-dry humor lurks around the edges, in small ornamental details, like watching Captain Jacobs (Robert Bockstael) lecture Seven about the elves’ unhealthy diet. They subsist entirely on simple carbs and sugar six times a day, and he thinks they should at least get a bit of protein now and then. And when a smarmy government suit gets nipped by Donner, Chris rasps, “You’re lucky it wasn’t Blitzen. She’ll tear your package clean off.”

Goggins’ Miller pretty much steals this film, as we see him intently building up his weapons cache, brushing up on his mixed martial arts, and taking a few practice punches at a cartoonish Santa head target. He doesn’t even try to be “funny,” playing it straight with a deadpan delivery that lets the absurdity of the situation speak for itself—especially in his interactions with his young client.

For instance, once Miller locates Santa, Billy demands the big man’s head as a trophy, but Miller warns him that heads rot and mold. When Billy next demands his beard, the hit man refuses: “I’m not shaving off a dead man’s beard.” (Miller is clearly not fond of his client, since the caller ID for Billy is “Little S*&t.”) And despite being a cold-blooded assassin, Miller keeps a pet hamster, even stopping off in a pet store en route to kill Chris so he can mount a hamster wheel on the car dashboard for his rodent companion. He is not pleased when the pet store owner suggests he seems more like a snake person: “Snakes eat hamsters.”

There’s a theme here of absent, neglectful fathers—and in the case of Miller, outright abusive fathers. Billy’s father prefers to spend Christmas in the Bahamas with his hot young girlfriend rather than with his own son, and he sends Billy a giant stuffed teddy bear as a gift, suggesting he might not even remember his son’s age. One might be tempted to feel bad for Billy if we hadn’t just watched him hire Miller to kidnap the young girl who won the school science fair instead of him, and threaten to electrocute her with a 12-volt car battery if she didn’t confess to cheating, so he would win by default. Oh, and he stole blank checks from his wheelchair-bound grandmother and forged her signature to take out a hit on Santa. Billy totes deserved that lump of coal.

Fatman might be deemed the evil twin to the 1989 French cult film Dial Code: Santa Claus (itself a precursor to Home Alone), in which a Rambo-obsessed young boy named Thomas battles a murderous intruder on Christmas eve. Both films share a dark sensibility, with only touches of wry humor. Dial Code: Santa Claus is essentially a violent fairy tale about the loss of childhood innocence; Thomas is a sweet-natured boy form a wealthy family, with a loving mother and grandfather, who is genuinely traumatized by the violence that breaks out when “Santa” comes down the chimney. Billy is his polar opposite: spoiled, entitled, and most definitely a sociopath who really doesn’t seem to comprehend things like empathy for others’ suffering. The question Fatman ultimately poses is whether Billy deserves punishment or a chance for redemption.

Fatman is now available on VOD. Pair with Dial Code: Santa Claus (if you can find it), or perhaps Die Hard, Lethal Weapon, Gremlins, or Bad Santa.

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We test Herman Miller’s $1,499 gaming chair: All business—to a fault

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Enlarge / The Herman Miller x Logitech Embody chair.

Sam Machkovech

Recently, our coverage of the work-from-home universe expanded to include “gaming” chairs. This is because, in spite of their branding, they’re not much different from average office chairs—and in a year when remote work has become ever more commonplace, they’re sometimes a competitively priced home-office option.

But what about the inverse idea of a traditional office-chair company launching a gaming chair? That’s the idea behind Herman Miller’s latest line of Logitech-branded chairs, which caught our eye when the company reached out with a loaner chair. Herman Miller’s decades of $1,000-and-up chairs have never previously included a gaming-branded product, while Logitech, better known for peripherals like keyboards, mice, and headsets, has never produced its own chairs. We were curious what the mashup would produce.

The quick answer is simple enough: it’s an existing Herman Miller chair model with a mild aesthetic tweak. And while it’s as solid as you might expect from a $1,499 home office chair, its game-specific branding doesn’t quite add up.

Unboxing and (lack of) assembly

The best part about the Herman Miller x Logitech Embody chair is the unboxing experience—if your home is suitable for it.

When reviewing a pair of gamer chairs in October, my colleague Jim Salter received each chair as its disassembled parts, and his initial setup included two different versions of the unboxing-and-assembly process. HM, conversely, ships the Embody in a larger-than-average, 40-inch-tall box, and its unboxing process is decidedly simple: open box, pull off a single cardboard mount, and roll the chair out, already assembled.

Should your ideal office or gaming environment be easy to reach from your preferred outside door, then it’s a matter of lugging the chair (38-inches tall, 26-inches wide at its most shrunken state) inside. But if you need to move the chair through narrow doorways or over stairs—or if you ever want to ship it in a smaller box in the future—be warned that there’s no official way to neatly disassemble and reassemble the Embody. Herman Miller only offers Embody buyers a “recycling” disassembly manual, which requires, among other things, a variety of Torx bits and a hammer to tear it apart.

Adjusting for office use

Weirdly, the model I received included a “welcome” booklet printed on fancy paper stock, but that booklet included zero instructions on how to adjust the chair to my liking. Since this chair has a few unique levers and a trippy grid of bracing points on its back, I opted to search the Internet for a setup guide. When I received the chair in October, I could only find a non-Logitech manual for the older Embody model online, though Herman Miller has since uploaded a Logitech-branded manual.

Unsurprisingly, those manuals are nearly identical, pointing to the same seven points of customization. Where the Logitech manual differs is its lack of recommendations. The normal Embody manual points out ideal or proper tweaks, accounting for things like when your feet touch the ground or how your shoulders shouldn’t lift when elbows touch the arm rests. The Logitech version’s manual does not.

Everything that has proven time-tested about the Embody applies to the Logitech model. Its adjustable seat depth, in particular, is a customization godsend, ensuring that bigger and taller users can enjoy as much under-thigh leverage as they might desire. I easily found an ideal tilt adjustment, which means I can enjoy a gentle, comfortable curve of increasing resistance as I lean back.

Most of my early testing on the Embody revolved around working on Ars articles at my desk, and this was the more comfortable way to use the chair. Its arm rests fan forward in a way that promotes sitting upright and resting elbows while typing, and its back support revolves around a “flat or curved” adjustment dial. The latter essentially operates as a lumbar adjustment, but it works less as a pad to sink that portion of your lower back into and more like an active support meant to promote even posture while actively using a computer.

Quibbles with gaming use

Once I moved my attention to gaming on the Herman Miller x Logitech Embody chair, on the other hand, I ran into personal usability gripes.

My biggest is with the armrests, which are designed to guide the right hand either to a keyboard or to very mild mouse use. If I’m playing games at my desk on PC, my right hand is locked onto a mouse, but the specific shape of the Embody’s armrest is sloped and weighted in such a way that my elbow isn’t supported if I go beyond micro-movements with my mouse. I’m surprised that the Logitech version of the Embody doesn’t let users change the arm rest’s angle so that an arm’s rotation toward a mouse pad is better supported.

Worse is the armrests’ clear focus on upright mouse-and-keyboard use, which is wonderful for an average day’s duties on a computer but less so should you lean back and hold a gamepad. Doing this exposes the armrests’ shallower bases closer to the chair’s back. If I’m not sitting at Herman Miller’s preferred “upright” position while holding a gamepad, my elbows slip off. The solution has been to adjust the back-support curve in a way that leads my elbows to the armrests’ sweet spot, but even when I do that, my posture continues to degrade over time with a gamepad. This is when my forearms fall back and become my arms’ resting point, which is worse in terms of posture. A deeper position for elbows to rest comfortably would fix this and prove better for my back.

More than any of this is the sense that the Embody is designed to keep you forward-and-upright while sitting, which is arguably the right call for an hours-every-day office chair. But whenever I turned the chair away from my desk and toward my living room TV, I always felt like I was at work. There’s nothing in this chair that manages to combine best-in-class posture support with coziness. The adjustable back support either pushes firmly into your back to ensure lumbar support, or it gives way as an uncomfortable curve. And there’s no headrest that my noggin can splash back on when things go awry in a tricky, modern game like Demon’s Souls.

Aesthetics, fabric, and bottom line

In good news, the aesthetic touch-up is in line with Logitech’s more tasteful strides in recent years. You can barely tell it’s a “gaming chair” from the front, since the only indication is a “G” marker on the chair’s face. (The letter receives a different black stitching than the rest of the black chair, so it’s visible, but mild.) On the back, the Embody’s plastic back-support grid is set off with a bold teal coloration, and the black-and-teal grid will be up to personal taste. I’m personally a fan, as this shade of teal doesn’t look particularly garish or clashy, but the color makes it easier to tell that this is a plastic grid than you might notice with the same grid in black.

Otherwise, again, this is identical to the default Embody, with an apparent exception to its fabric construction. Though I do not have another Embody to compare with, I’ve seen reports about the fabric used on the Logitech model, including a mild tweak to its padding—enough so that dedicated Herman Miller users have called the Logitech update a preferable option of this model for anyone set on the Embody as a home chair option.

That’s assuming you have $1,499 to devote to a new chair, either for your home office or your favorite gaming room. And when we take a hard look at ergonomics in a chair you use frequently, the Herman Miller x Logitech Embody hits many crucial notes—adjustability on multiple axes, room to comfortably shift, and promotion of proper posture. The thing is, you can likely find those in solidly built chairs for hundreds less, whether or not they include gaming logos or branding.

I enjoyed testing this version of the Embody, as it’s a dependable chair without issues like uneven wheels, squeaky joints, or other things that are easy to take for granted. And I appreciated that it left good-enough alone instead of adding questionable updates like “racer”-minded redesigns. Still, I didn’t send the loaner back convinced that I needed to swap out my existing chairs or that Herman Miller had solved problems in the gaming-chair spectrum.

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How old, ambient Japanese music became a smash hit on YouTube

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Enlarge / Record collector Mike Porwoll’s selection of vinyl records, fueled largely by YouTubecore discoveries.

Mike Porwoll

One way to track the evolution of popular music is to examine its subgenres. Think of how “rock” begat “punk rock,” which begat “post-punk,” as a simple example. Electronic and ambient music include an even bigger universe of subgenres, with hyperspecific names like “UK bass,” “chillwave,” and “electroacoustic.”

But what happens when a genre emerges not because of its artistry, but because of its discoverability?

This is the place “YouTubecore” finds itself in. YouTube famously hinges on an algorithm that guesses viewers’ interests to keep them clicking and viewing, and we’ve seen how weirdly that algorithm can go, both in innocent and diabolical ways.

In the case of music, however, YouTubecore has emerged in ways we never saw from MTV, radio, or other traditional platforms: as an explosive response to average computer and smartphone users wanting chill, ambient music. Through this, the new-age trend of the ’80s has made a surprising return, fueled by Generation Z’s musical interests and some Silicon Valley code, and those combined forces are unearthing ethereal surprises from the past and present.

Traits and early examples

The concept of YouTubecore is admittedly open-ended in terms of genre and style, but for our purposes, we can limit it to soft, instrumental fare—specifically, an algorithm-driven hierarchy of ambient albums that leans, for one reason or another, to the island nation of Japan. The YT uploads in question tend to include complete albums as opposed to individual songs, and some of the most popular examples were uploaded by anonymous users, not the original artists, often decades after their original releases. And none of the albums previously enjoyed particular commercial success.

Some consider Midori Takada’s forgotten 1983 album Through the Looking Glass to be one of the first YouTubecore albums. Uploaded in 2013, the original video has since been delisted, but it did go on to accrue millions of views—which was followed by Takada playing a set of worldwide tour dates, including her first in the United States. Other albums by different artists followed suit, many from the same 1980s Japanese ambient scene.

“Plastic Love,” by Mariya Takeuchi.

The most famous upload of them all (not ambient, but too known to not mention) came in 2017, when a video of the 1984 city pop song “Plastic Love” by Mariya Takeuchi became mind-bogglingly popular. Once a Japanese bargain-bin staple, people started buying it for $60 a pop in the United States. It has 45 million views today, along with an Olympic swimming pool’s worth of fan art, vaporwave remixes, and memes.

From YouTube to the hotel lobby

Ambient-music fan Balthazar Aguirre uploaded the album <em>Dreams</em>, by Gábor Szabó, to his YouTube channel years ago. It eventually exploded as a major YouTubecore album, as shown by stats shared with Ars Technica. "I have no idea what happened between September 12 and September 27 [2016] when it absolutely exploded," Aguirre says.
Enlarge / Ambient-music fan Balthazar Aguirre uploaded the album Dreams, by Gábor Szabó, to his YouTube channel years ago. It eventually exploded as a major YouTubecore album, as shown by stats shared with Ars Technica. “I have no idea what happened between September 12 and September 27 [2016] when it absolutely exploded,” Aguirre says.

Balthazar Aguirre

Benjamin Wynn, who performs under the name Deru, is an LA-based composer and television sound designer known in part for his work on Nickelodeon’s Avatar: The Last Airbender. His ambient work 1979, named after the year of his birth, has gathered almost 4 million views since the account Tape Counter uploaded it in 2015, one year after the album’s original release. The video strips away much of the album’s context, as 1979 is a mixed-media project with peripheral content including a collaborative photo album, an invented philosophy, and a limited run of pico projectors (created with the assistance of Robert Crespo, who made circuit boards for Mars rovers) containing visuals for each song.

Wynn’s label owner first noticed the uncanny YouTube popularity of 1979, which was soon followed by YouTube revenue payouts for each video play. Typically, YouTube’s Content ID system identifies and tags copyrighted material, then redirects view-based revenue to performers instead of faceless uploaders. But YouTube is a different revenue beast than services like Spotify, primarily because it pays per complete play; in Wynn’s case, a play of 1979 is 44 minutes long.

1979 by Deru.

Wynn watched the video comments skyrocket into the thousands. Then he and his wife were vacationing in Tokyo when he heard 1979 play on hotel-lobby speakers—without any Japanese promotional efforts that he knew of. And while YouTube revenue for the video hasn’t been huge, its exposure has had one noticeable effect: physical sales. The 1979 vinyl edition is now on its fourth pressing.

Wynn has never had contact with the uploader. “At one point I was thinking, ‘I should just give my next record to this person!'” Wynn says. “But they have a lot of uploads that didn’t take off, so clearly this isn’t a 1:1 correspondence.”

“My only complaint is that it feels utterly random,” Wynn continues. “I can’t bank on the algorithm associating my name with this video; I’ve put out videos since then that haven’t received the same attention.”

Research on trends like “Hair Dryer Sound”

Without official answers from YouTube parent company Alphabet, musicians and fans alike are left guessing how its algorithm has driven this subgenre’s millions of views.

“Maybe [YouTube] scrapes through the actual sound waves, and it finds [and suggests] something similar?” record reissuer Yoskue Kitazawa says, calling to mind sound-analysis services like Shazam. “YouTube does have an auto-caption function, and it might do the same thing with audio.”

I asked friends, some of whom are better versed in YouTubecore than others, to look up Hiroshi Yoshimura's <em>Green</em> on YouTube and take a screenshot of the resulting sidebar. The results vary but include common hallmarks of the YouTube-generated genre, particularly an emphasis on ambient musician Takashi Kokubo.
Enlarge / I asked friends, some of whom are better versed in YouTubecore than others, to look up Hiroshi Yoshimura’s Green on YouTube and take a screenshot of the resulting sidebar. The results vary but include common hallmarks of the YouTube-generated genre, particularly an emphasis on ambient musician Takashi Kokubo.

Massimo Airoldi, a professor at Emlyon Business School, co-authored a 2016 paper titled Follow the algorithm: An exploratory investigation of music on YouTube. It proposes that the algorithm partially leans on sequential viewing: if a significant number of users watch video B after video A, the two are considered related and therefore recommended. Within this framework, genres stop being simple technical distinctions and become granular concepts based on crowdsourced human-behavior patterns. Utilizing neural networks, the study estimates that viewing habits cause the algorithm to connect videos via recommendations, thereby knitting tight genre cliques in the process.

Seven out of 50 video clusters the researchers identified are deemed “situational” music. This designation doesn’t operate under the standard concept of genres but rather the context in which the music takes place. This includes relaxation music like “Ambient/Chillout,” “Sounds of Nature,” and the ASMR-affiliated “Hair Dryer Sound.” The paper concludes that situational music, sometimes deemed trivial by musicologists, is growing in popularity. They also found a cluster of “Ethiopia/South Sudan Music,” suggesting the context of a local scene comparable to ’80s Japanese ambient music.

This prediction was, of course, correct, with the rise of ambient YouTubecore being fueled by twin elements: “[The music] can be seen in both ways, either as relaxing instrumental backgrounds or as high-art examples of some avant-garde scene,” Airoldi says.

Watch time is also mentioned in Airoldi’s research, which makes sense as YouTubecore’s album-length videos typically exceed 40 minutes.

Setting the stage with GeoCities searches, vinyl translations

In the years before YouTubecore, Western DJs and bloggers set the stage for it to come into the mainstream. Musician Spencer Doran released an influential Japanese ambient mix in 2010 called Fairlights, Mallets and Bamboo. Online mixes in general remain popular to this day: since I began researching for this article, a video titled “Japanese jazz while driving on a warm night” has been popping up in my recommendations relentlessly; it’s up to 1.2 million views as of press time.

Since 2014, Jen Monroe’s blog Listen To This has brought Japanese music to English-speaking audiences, often with an emphasis on out-of-print music. Before the YouTubecore movement took off, her work required jumping through serious hoops: “Cold emails to strangers begging for records I suspect they have, sending PayPal payments to Japan for CDs hoping that they ever show up, [and] clawing through pop-up ads on Google-translated content scraper sites and ancient Blogspot posts.”

Diego Olivas followed in Monroe’s footsteps with his blog Fond/Sound and connected YouTube channel. He discovered music through old GeoCities websites and ordered vinyl from Japan. Then, as a way to expose this data to the English-speaking Internet, he took pictures of those albums’ liner notes, ran them through OCR (optical character recognition) software, and copied the text into Google Translate. As YouTubecore arose, labels sent him takedown notices. Some Discogs record slingers posed as label owners and sent fake takedown notices to manufacture scarcity.

Both Monroe and Olivas tell me that quite a few blogs like theirs are written in Japanese.

How much authenticity drives the algorithm?

An Empty Bliss Beyond this World by the Caretaker.

Leyland James Kirby has made music as the Caretaker since the late ’90s, employing a trademark sound created from distorted waltz records. Driven by the concept of memory, his initial work focused on the ballroom scene in The Shining before moving on to memory conditions—specifically anterograde amnesia and dementia.

A 2011 upload of his album An Empty Bliss Beyond This World by user alteredzones currently has 3.6 million views. Kirby’s own 2019 upload for Everywhere At the End of Time, his six-hour album portraying dementia, currently has 5.2 million views and 95,000 comments. Videos about that album also recently blew up on TikTok.

Kirby has never promoted his work save for giving the occasional interview. “When I saw videos of my work getting millions of listeners, I thought to myself that something must be happening, as I knew I hadn’t paid for views or gamed the system,” he says. He attributes it to the quality: it’s “based on the sound contents and ideas contained within the work,” Kirby says. “For the algorithm to pick this kind of work up, it already needs existing engagement from an audience.” Based on the data he’s seen, 12 percent of the video’s recent views have come from the algorithm, while over 50 percent have come from direct searches.

Wherever the views come from (Kirby’s work certainly appears relentlessly in my YouTube sidebar), Kirby is careful to make room for at least some authenticity driving listeners to his music: “I think it’s genuine in the sense nothing has been bought,” he says. “It’s a straight success.”

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