Interview: Ubisoft responds to angry NFT Digits and Quartz reaction

We talk to Nicolas Pouard, VP at Ubisoft's Strategic Innovations Lab, about the launch of Ubisoft Quartz and the Digits NFTs.

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On 7 December 2021, Ubisoft became the first big-name game developer to publicly enter the NFT space. The launch of the Ubisoft Digits, an NFT, and the Quartz platform did not go down well. Gamer feedback was negative to the point of being aggressive. The big names in game press were also tepid in their analysis. One way or the other, this was a landmark moment in gaming.

I can understand why gamers are wary. But I personally do not share the anger. In fact, I was excited by the launch of Quartz and Digits - and since then esports - albeit with an asterisk.

Having worked in games media for well over 2 decades, I'm about the experience first and foremost. I play for fun. I'm not interested in investing or in making money from games. But having also kept a close eye on blockchain and NFT games over the last 4 years, I can see the potential the technology has to offer gamers greater freedom. If products like Ubisoft Quartz and Digits (and you can trust that more will come) are handled correctly, there's plenty for gamers to gain.

True ownership of not just a product, but a stake in the gaming ecosystems we create through play and community, is a future with positive potential. If done right. If promises are kept.

Will Ubisoft do it right? Or will Quartz and Digits be the demon spawn that devour our beloved hobby?

Ubisoft interview: Nicolas Pouard and Didier Genevois

I presented my fears to Nicolas Pouard, VP at Ubisoft's Strategic Innovations Lab and the man leading the charge on Quartz and Digits, to see how he would respond to the hate that his products have generated. This is what he had to say, with help from Didier Genevois, Ubisoft's Blockchain Technical Director.

Note: This interview was conducted in English, which is a second language for both Pouard and Genevois.

Gamer feedback to the Ubisoft Quartz and Digits launch has been generally negative. What has the feedback told you about the prospects of mainstream NFT success?

Nicolas Pouard: Well, it was a reaction we were expecting. We know it's not an easy concept to grasp. But Quartz is really just a first step that should lead to something bigger. Something that will be more easily understood by our players. That's the way we think about it and why we will keep experimenting. We will keep releasing features and services around this first initiative. And our belief is that, piece by piece, the puzzle will be revealed and understood by our players. We hope they will better understand the value we offer them.

You spoke in your presentation about improving the relationship with players. If that is your goal with Quartz, it must be quite frustrating to see the feedback you've received.

NP: It's part of the process, I would say. It's a reaction we are accustomed to. I think it's great because it shows how engaged our players are and how passionate they are about their hobby and gaming in general. And looking at that, I think it's reassuring somehow. It shows that our players love what we do and love Ubisoft's ability to offer good games. So that's cool.

Still, obviously we are a bit frustrated, yes. But I think overall it's okay and it's something we can really understand. We so strongly believe that what we are doing [with Quartz and Digits] goes in the right direction. So, we will keep integrating. Obviously listening to what our fans are telling us, and how they're telling us, as we go, so we can also adapt what we're doing and where we're going. So that's the next move. To make sure what we're doing will make even more sense to gamers.

Well, let's talk about making sense of it. What do you think is the big positive that gamers are missing about what NFTs like Digits can offer them?

NP: I think gamers don't get what a digital secondary market can bring to them. For now, because of the current situation and context of NFTs, gamers really believe it's first destroying the planet, and second just a tool for speculation. But what we [at Ubisoft] are seeing first is the end game. The end game is about giving players the opportunity to resell their items once they're finished with them or they're finished playing the game itself.

So, it's really, for them. It's really beneficial. But they don't get it for now.

Also, this is part of a paradigm shift in gaming. Moving from one economic system to another is not easy to handle. There are a lot of habits you need to go against and a lot of your ingrained mindset you have to shift. It takes time. We know that.

Ubisoft Quartz Digits 1

Do you think you would have been better off launching Quartz without mentioning NFTs or blockchain? If you had just launched a new platform that offered gamers something new without exposing them to the underlying mechanics powering it?

NP: Actually, we tried in a way, that's why we named them Digits. We considered not speaking about the technology, but we know our players. They would've known Digits were NFTs. So, we decided it would not be very smart to try to hide it. Our principle is to build a safe place and safe environment with Quartz. So, we need to be transparent on what we are doing.

Didier Genevois: If I can just comment a bit on that. As Nicholas said, we knew that if we didn't reference the technology players would've noticed. And one of the first concerns gamers have when it comes to blockchain is its impact on the environment and the energy it consumes. As such, it was key for us to be able to show we were aware of that concern and that we're making an active choice of going with Tezos.

That [communication] is in line with our engagement as a corporation. Our research has a very strong engagement when it comes to the environment and those concerns. It's transparent for us to be able to pre-empt that discussion to make our players know we've taken the right step to protect the environment.

It's not just the environment, I fear. A lot of the feedback I read suggests that gamers view, or fear, NFTs being the new microtransactions or the new loot boxes; that Digits are going to make gaming with Ubisoft more expensive. Are they right or wrong?

NP: Well, first, players are always right. Because they are our players, and we love them. And so, they're always right. But your observation is correct. The first point I would say is that Digits are fully optional. It's something we've built outside the game's economy. So, you can use Quartz or you can choose not to use it. It's really a matter of a personal choice.

At no point will we force our players to use Quartz and Digits. We just inform them that there is a new system that could provide them with higher value than the existing ones. So, that's the very first point.

Then there's the way we built the platform regarding eligibility criteria. We've made it so it's somewhat hard for people to get into it. You must purchase the game. You must play at least 2 hours. So, it's a bit complicated for pure speculators to go there and invest and inflate the markets. It's not that complicated either, but there are so many other options out there for speculators to get into and mess around. We think, and the first figures we have corroborate our expectation, that Quartz is primarily for our players. It's what we're seeing when we look at data.

Remember, this is still an experiment. We will adapt the volumes of our upcoming editions so that there's not too much inflation. Our main concern is to make sure that even on a secondary market, prices do not go too high, so that it's still accessible to regular players.

So, for clarification, something like the skin NFT we've seen released for Ghost Recon: Breakpoint, will that also be available to buy through the game economy – or even earned in-game – and then only become a unique NFT if acquired or registered through Quartz?

NP: No, so those skins are exclusive to Quartz. You cannot get them in game if you do not go through Quartz.

One of the big beliefs tied to blockchain is decentralisation. About taking power away from the big corporates and putting it in the hands of the consumers. Looking from the outside in, I question instantly the value of decentralisation for a company like Ubisoft. How is decentralisation good for Ubisoft?

NP: So, the question is really about player engagement and how you share an ecosystem with them. When you look at the valuation of just Ubisoft the company, it's over US$3 billion I think, something like that. But the whole ecosystem [of Ubisoft products] is valued at more than US$15 billion. So, the ecosystem is much bigger than just a company. The ecosystem is composed by the company, but also the players and the whole range of roles that players can have in this ecosystem.

As such, the interest in decentralisation for a centralised company like Ubisoft is to open the gates of our games and to make them bigger by sharing [a stake] with our players. To build new experiences that are on top of what is in each game to date. It's a new way to see what a game could be.

I don't want to go into numbers, but owning a percentage of a huge ecosystem might be even more interesting than just owning a game today. I'm sorry as I know it's difficult to understand right now as this kind of idea doesn't really exist yet [in gaming]. But we see that the ecosystem for a game can be much, much bigger than what a game is today in terms of value creation for everyone.

The most cynical feedback I've read from gamers has pointed to this all being a ploy to line Ubisoft's pockets with more money. But you see it being about creating a deeper player engagement experience?

NP: Yes. The model of play to earn is about allowing players to make their own money by adding value to the whole ecosystem. So, it's not just about Ubisoft, actually.

Considering that Ubisoft is trying to lead in this emerging space, when you see what happened with the S.T.A.L.K.E.R. 2 team – where they announced an NFT integration then ditched it after backlash – how does it make you feel? What was your reaction?

NP: It's saddening to see there's still some resistance based on misunderstanding. But I'm not sure we can really compare what S.T.A.L.K.E.R. 2 was trying to do with what we are trying to achieve with Quartz. It's not the same use-case to the players, I would say.

Ubisoft Interview NFTs C

I know it's only been a couple of weeks since the launch of Quartz, but what are the key learnings you've taken away so far from the launch of Digits.

DG: What we learned is that the hurdles we put in place for the eligibility criteria worked. A very big majority of the 2,500 tokens ordered [in the first 2 weeks] were from Ghost Recon: Breakpoint players. They didn't start playing when we launched Quartz on 7 December. They were playing the game for a very long time beforehand. It was good to see that, because to us, that was the biggest risk. That the market would be pre-empted by speculators. Which is absolutely what we didn't want to do.

NP: Maybe just to add to that from a technical standpoint, we are very happy that everything worked as we expected. And it wasn't so easy because we are built on top of the Tezos [blockchain], which is not the obvious choice when you are building NFTs. But we wanted to be committed to this environmentally friendly choice. We are very happy with that. Also, I think from the user experience, it's easy to onboard on the Quartz platform.

Do you guys see a future where players own the games themselves? That the games are an NFT?

NP: That's part of the use case we can explore, but it's not the focus today.

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And do you see a future where the majority of Ubisoft games, if not all of the games, are tied into Quartz and Digits in some way?

NP: Actually, we are a very decentralised company already. We let each project's team decide if they want to have Digits or not. Or use the Quartz platform itself. So, it's open.

But obviously, the Tom Clancy games would be a first point of call?

NP: (Laughs) Potentially.

Moving on from games then, during your presentation on Quartz and Digits, you mentioned possible future acquisitions of Decentralised Autonomous Organisations (DAO). What did you mean by that? Did I mishear?

NP: [I meant] the future of user acquisition. When you talk to the DAO guys, like Yield Guild Games, they really see themselves as a new tool for user acquisition in games. Because if you build a good play-to-earn experience, those guilds will come to your game, and they will boost up your ecosystem and the net effect is that you need to engage the whole economy and community. So yeah, it's no more just about the marketing expense of how you acquire new players, but it's how you build your game in a way that will attract the [DAO] guilds.

Ubisoft Quartz Digits 2

Attracting guilds talks very specifically to the play-to-earn space. Is that something you're interested in and if so, would it be via a new IP or will you look to apply P2E to an existing IP?

NP: Yes, we're interested in play-to-earn. For us it's the same logic to what we're doing today. So, we are trying to think of Ubisoft games as a place where your experience can provide the most value possible. Meaning, there are different kinds of value as you play a game.

There's the fun, of course. The pleasure you get by just playing. There is the fact that you can learn things. For instance, in Assassin's Creed, you learn about history, and we worked on experiments in old games when you could learn new soft skills. So, a game can be a lot of things and can bring a lot of things to players. Adding a real-world value reward might be the next addition on top of all the value a game already offers.

So, Quartz is just a continuity of what we're [already] doing, but it must be handled well, I would say. Or properly. That's why it does not make sense to use an existing game with an existing economy and trying to move it over to a play-to-earn economy. It truly needs to be built from scratch, because it's a very different way to think about the game economy and the monetisation.

Will you or are you already in discussions to license Ubisoft characters as crossovers with other NFT games? Like an axie from Axie Infinity that looks like a Rabbid? Are you guys looking into things like that and trying to spread the Ubisoft brand in the existing NFT space?

DG: In the past we made some experiments by joining Cryptokitties and Rabbids. So, there's definitely an avenue to cross-brand experimentation like this. For now, there is nothing that is about to be shipped. But yes, internally it's a probability at some point as that [kind of activation] is what the technology provides in the end.

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