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VR's Brookhaven Experiment kicks off AAA push into casinos

Phosphor Games and Gamblit explain why they're betting AAA video games will take off on casino floors

If you're one of the early adopters of virtual reality gaming, you've no doubt tried or at least heard about Brookhaven Experiment on the HTC Vive. The survival horror shooter has been one of the more popular VR titles since the Vive launched and Chicago-based Phosphor Games has been thrilled with its reception, confirming to GamesIndustry.biz that it's been a profitable product, selling into "a very decent chunk of the Vive install base." Phosphor is aiming to be on PlayStation VR on day one, on OSVR later in the year and other VR headsets around the world. The next step for Brookhaven Experiment, naturally, is to enter the world of casinos. Wait, what?

Yes, Phosphor is working on a customized edition of Brookhaven in a new partnership with Gamblit, a young company that aims to revitalize gambling for an entire generation of gamers. The two companies have teamed up to build a "Virtual Reality Cube" or VRC, which they hope will draw players' interest on casino floors to try out VR and place some bets while they're at it. Brookhaven's VRC makes its debut at G2E in Las Vegas from September 27-29. The full distribution plan at casinos in the US and elsewhere is still being figured out; Gamblit has to see what operator interest and demand is like following G2E, but the company has already shown promise, having landed a national agreement with Caesars in which they'll be rolling out Gamblit hardware across every location that they own in the US. Can Brookhaven capitalize?

"I've never been a heavy gambler because I think I am an example of what Gamblit and the operators are seeing, which is that I have some savvy about what the odds are like... The best time I've had gaming on the floor was when I was playing nickel slots and got a free beer and I came out $10 short after an hour and I was like, I got an hour's entertainment for 10 bucks," Justin Corcoran CEO at Phosphor Games tells me. "So Gamblit's model of, if you have some skill as a player, you're going to lose more like 10-15% of the money you spent over time, that goes from being like a predatory experience, to being an entertainment experience to me and I'm a huge advocate of transforming, as Gamblit is trying to do, the real money gambling location-based experiences. It makes casinos more into more entertainment. The casinos are still making money. People are having fun. They feel like their skill makes a difference. And we're just so happy to be part of that transformation.

"I haven't seen an opportunity this promising or an industry that was this in need of change and potential growth since I switched from making big budget console games into mobile games in 2010"

Darion Lowenstein

"At Phosphor we always try to be at the forefront of gaming technology. We were one of the first in mobile, we were one of the first in motion gaming, we're one of the first in VR, and, for us, this is another frontier we're very excited about. We'd love to look back with our partners in Gamblit a couple years from now and say we helped, not only pioneer VR, but we helped pioneer transformation of the real money gaming industry moving into a space where their players are happier with their experience and their entertainment and they're still very profitable and they're revolutionizing themselves for the new generations that are coming in that age group."

So how exactly does the actual gambling work in Brookhaven? Essentially, people watching a game around the VRC can place bets on a player's performance and certain aspects of the gameplay.

"When you start the experience you basically choose a bet amount - I think right now it's $15, $25, and $50 are the ranges of what you can bet - and then once the player's starting, the other people that are watching use tablets to bet on how well they think you're going to do. So if you jump in and you're playing, you're going to have three different challenges and goals and different rewards for things and then, as I'm watching you, I can bet on, 'Ok, I bet that James is going to have at least 70% accuracy because he's a pretty good shot. I bet he can survive the first round. But I'm not going to bet on how much health he has left yet because I would imagine he's probably going to get below 50% health.' Stuff like that," notes Gamblit Gaming CMO Darion Lowenstein.

But what about match fixing? Couldn't a group of friends go to the casino in advance with a plan to know how much to bet because someone could, for example, deliberately fail in the second round? Gamblit believes it has the solution to that problem - give players incentive to actually try to keep going and punish losing.

"The way the betting works is spectators are betting on how well the player does with specific goals - the same ones the player has, not things like dying or losing. In fact, if the player dies, everyone loses their bets. So, the player is incentivized to complete their challenges and survive, as are the spectators. Everyone benefits if the player does well, not if they lose," Lowenstein states.

Lowenstein, who has more than two decades of experience in traditional gaming from working at Rockstar, EA, Activision, and Scopely, didn't imagine he'd be involved in the casino space, but he now feels the opportunity is too great to ignore.

"In a nutshell, Gamblit reached out to me after I had left Scopely. I was VP of development there at that mobile publisher. I basically was like, 'Thanks guys, I don't really want to make casino games. Super boring.' And they were like, 'No, no, no. Just come in. Let us explain.' So I had a really great meeting with the CEO. After talking with him for about 3 hours, I'm like, 'Wait. OK. So basically what you're telling me is I could work on bringing arcades back to life and play Street Fighter on the casino floor for money. Let's do this. I'm in.' And honestly, I haven't seen an opportunity this promising or an industry that was this in need of change and potential growth since I switched from making big budget console games into mobile games in 2010," he explains.

According to Lowenstein, gambling is around a $450 billion a year revenue industry globally, but it's largely driven by an older demographic. The games on casino floors just aren't resonating with Millennials and the Gen-X crowd that grew up on video games.

"There just hasn't been a lot of change. Where they've innovated has been entertainment in terms of great food, great shows, awesome crazy clubs, DJs. But when you look at the core gambling experiences that are on the floor, there's a reason that their 21 to 45-year-old crowd, which is the biggest demographic coming on to the floor, isn't gambling. They're coming there for the entertainment experiences, but there's nothing that speaks to them because a slot machine doesn't speak to someone that grew up playing Super Nintendo and Xbox and now plays Candy Crush and Clash of Clans on their phone. It's just such a completely different experience," he says.

"It's completely understood in the industry that there is an age divide problem. There is a major issue with that prime demographic that's on the floor that's already spending money, that has money to spend and isn't spending it on wagering. So it's definitely seen as a lost opportunity... Operators have played our stuff. They've been in talks with us for a while and they see the potential - because they know their customers better than anyone. And they know that you can walk through any casino floor and you can see younger people sitting on the slot machine and they're playing Candy Crush or Snapchatting or doing something else on their phone, using it as an expensive chair."

Corcoran says that his team at Phosphor has been working on the customized gambling version of Brookhaven for a few months now, and he sees the VRC as a good way to introduce VR gaming to new customers who've never tried the technology while allowing them to place bets at the same time.

"[Gambling] just adds this whole extra layer of fun and community and social interaction to what is already a very social experience with this game"

Justin Corcoran

"We have a team working on designing and implementing this specific version of the game. It has the same core experience. It has these whole extra layers that Gamblit inspired and collaborated with us with on that you can only get in the version of the game. The spectating is always a big part of Brookhaven. All the videos of people enjoying watching their friend freak out or crashing into a wall just swinging wildly at monsters - it's so much fun," he says. "We say to people, 'It's a good first experience with VR for you and for you to watch other people have their first experience of VR.' This has taken that aspect of the game to a whole other level of, 'Ok, while you're going to watch your friend flail around like a crazy person shooting monsters you can bet on how long they're going to survive in the game.' You actually get to put the block up with your drink, put a bet on the virtual table, and then say to your buddy, 'Hey I don't think you can make it through 3 rounds. I've got 10 bucks on it.' It just adds this whole extra layer of fun and community and social interaction to what is already a very social experience with this game."

In terms of how the business works for developers interested in pursuing real money gaming versions of their own titles, Lowenstein explains, "The traditional model that Gamblit typically uses is we'll do a revenue share or a licensing fee for all of our triple-A content from partners that we bring on to the floor. So, essentially, we can create a new revenue stream in that market since you have to be licensed and regulated and everything for territory. So that's sort of our entire business model."

AAA gaming in casinos is an entirely nascent idea at this point, but one area that seems ripe for expansion is sports. People have office pools and bet on the NFL, NBA and more all the time. It's easy to imagine the draw of something like, say, Madden on a casino floor if people can bet on the outcomes.

"Totally. The sports market is massive. We've got titles that are either in negotiations or in development in pretty much every genre," Lowenstein notes. "There's a lot of stuff that we wanted to tackle first like match-three games and zombie shooters and a lot of those. We're still a relatively small company. We're about 95 people. So as much as I'd love to have a slate of 50 games, we're starting out small and going AAA. I think Brookhaven is the key example. For our first VR project, we wanted to get the most successful and most fun to play game. I'm personally very happy with it."

"[There's] a very high bar on having an extremely polished product...day one. Unlike a mobile game or a console game, you can't just have a patch that goes in and updates when the person starts playing"

Darion Lowenstein

If the Brookhaven VRC is successful, Phosphor and Gamblit could team up on more experiences in the future. "We have other games in concept and in development that I think would fit this model as well. We've been very happy with the relationship," Corcoran says.

There's even the potential for new content within Brookhaven on casino floors, but don't expect updates to be as simple as a quick download to the VRC.

"That's the crazy thing about learning all of the rules of creating a wagering product. Holy crap, there's a lot of rules. There's a lot of legality. So I was probably a little bit naive coming into it. Now, having spent a year and a half with the company, I can tell you that there is no such thing as a simple easy update to a video game. My days of being able to go into a mobile title and be like, let's do this server-side update, it'll be live in 10 minutes... Long gone," Lowenstein says. "Basically, because you are dealing with people's money at the end of the day, any game that goes onto a floor of any casino - and this is true for any slot game, this is true for any Gamblit game - typically goes through between 4 to 6 months of reviews. Unfortunately, that is also true for updates. So, yes, we could absolutely update Brookhaven with new levels, new monsters, new art, anything we want, but it has to go through the full review process. Once the game's actually gone through the first time and been on the floor, from what I hear, it sounds like we might be able to get something through in like, say, 3 months. But still, a 3 month turn around versus a server side update - painful.

"It's tough. I make a lot of references with our business to a '90s arcade, which is basically where I grew up, because it's a very similar experience. With NeoGeo systems that were in the arcades back in the day, they were multi-game devices that, if you want to change something or upgrade, it was a whole new cartridge. There was no internet or updating. It's sort of similar, right? It puts a very high bar on having an extremely polished product that you put through day one. Unlike a mobile game or a console game, you can't just have a patch that goes in and updates when the person starts playing it."

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James Brightman


James Brightman has been covering the games industry since 2003 and has been an avid gamer since the days of Atari and Intellivision. He was previously EIC and co-founder of IndustryGamers and spent several years leading GameDaily Biz at AOL prior to that.