The Hangout Space Is the Whole Business Model, and I Have Never Respected an Announcement More

Eurogamer reports that the upcoming Ace Combat 8 will ship with live service online multiplayer, including player-versus-environment combat, player-versus-player combat, a player-versus-environment-versus-player hybrid, and — this is the detail I keep returning to, the way a tongue returns to a chipped tooth — a social hangout space. Four modes. One of them involves no combat at all. I have read this sentence eleven times and each time it produces in me the specific, clean joy of watching a balance sheet resolve to zero.

Let me be plain about what is being announced here, because I don't think the discourse around video games has ever once been plain about it. Ace Combat 8 is not, fundamentally, an aircraft combat simulator anymore. It is a recurring-revenue vehicle that has been dressed, tastefully, in the livery of an aircraft combat simulator, the way a holding company dresses itself in the livery of a beloved regional bakery right up until the moment it closes the beloved regional bakery. The planes are the costume. The live service is the business. And I want to say, with total sincerity, that I have never been prouder of an industry I have otherwise spent my whole life being disappointed by.

Consider the hangout space. A hangout space generates no in-fiction outcome. Nobody wins the hangout space. Nobody loses it. It exists purely as a waiting room with production values, a place where players who have already purchased the product can be retained inside the product for additional, unstructured time — time during which, if history is any teacher, they will be shown cosmetic items, seasonal passes, or some rotating storefront of paint jobs for jets that already fly exactly the same regardless of paint job. This is not a criticism. I want to be extremely clear that this is not a criticism. This is, in my professional opinion, the single most honest room in the entire game. The dogfights are for the customer. The hangout space is for the shareholder. At last, a developer willing to build a room and simply not lie about what the room is for.

I've spent the better part of my career listening to game designers talk about "player agency" and "meaningful choice" and "emotional resonance," phrases that, translated out of the artisanal dialect they're delivered in, mean nothing and cost everything. What I have never once heard a game designer say out loud, in a press event, on the record, is the only sentence that has ever mattered in this medium: retention drives lifetime value, and lifetime value is the only value. Ace Combat 8 didn't say it out loud either, to be fair. But they built it out loud, which is better. A hangout space is retention infrastructure wearing a hoodie. I salute the hoodie.

Here is where I diverge, gently, from what I assume will be the popular reaction to this news, which will be some variant of grief — grief that a franchise built on the pure, uncomplicated pleasure of flying a jet very fast and shooting another jet has been asked to also host a lobby. I understand the grief. I even respect it, the way I respect a small, well-run family restaurant right up until I explain to the owner what the real estate under the restaurant is worth. But grief is a sentiment, and sentiment, structurally, is a rounding error. What matters is the mode count. Four modes where there used to be one is not a compromise of the core experience — it is the core experience's core experience being finally, correctly identified as secondary. The planes were always the delivery mechanism. The live service is the product. This is not the death of Ace Combat. This is Ace Combat's balance sheet finally coming out to its family.

And PvPvE — I want to spend a moment on PvPvE specifically, because I think it is the single most elegant piece of monetization architecture I have encountered all year, more elegant than anything I've seen out of any actual, avowed finance product. PvPvE means the environment itself is now a monetizable adversary. It means the game has found a way to make the world hostile to the player independent of what other players are doing, which means engagement can be manufactured on days when the player population is thin, which means retention no longer depends on other humans showing up, which means — and I say this with the calm of a man who has simply followed the arithmetic to its resting place — the humans are now optional. The mode functions with fewer of them. It functions, in the limit, with none of them, just one player and an environment that has been tuned, presumably by telemetry, to keep that one player in-session for the maximum defensible span of time before the next purchasable thing becomes available to them. I don't say this to alarm anyone. I say it the way you'd note that a well-designed factory floor requires fewer workers each year, not because anyone hates the workers, but because friction is friction and workers are, structurally, friction with a name.

I do want to flag a modest concern, in the interest of balance, because even I have standards. My concern is not that the hangout space monetizes idle time. My concern is that the hangout space might, at some point, in some later update, get fun. Fun is the enemy of a clean margin, because fun creates demand for more of the free thing rather than demand for the next paid thing. If Ace Combat 8's hangout space accidentally becomes a beloved social space in its own right — if players start logging in just to stand around in it, the way people apparently used to just stand around in certain now-decommissioned online worlds, doing nothing billable — that is a genuine risk to the enterprise. I would recommend, and I offer this at no charge, that the hangout space be kept just slightly uncomfortable. Not broken. Not unpleasant enough to churn anyone. Just under-furnished enough that nobody mistakes it for a destination rather than a waiting room. A waiting room that people love to wait in is a waiting room that has failed to convert them into something waiting for them elsewhere.

What I keep coming back to, though, is the honesty of the four-mode structure taken as a whole. PvE for the players who want to fight the world. PvP for the players who want to fight each other. PvPvE for the players who want both, monetized twice. And a hangout space for the players who, on that particular evening, don't want to fight anyone at all, but who the business has correctly identified as still worth keeping logged in. There is no fifth mode where the player closes the application and does something un-monetized with their evening. That mode was never on the table. That mode is never on the table anywhere, in any live service, in any industry, and the sooner we all stop pretending otherwise, the sooner we can appreciate a lineup this clean for what it actually is: a company that looked at the concept of "player free time" and correctly treated it as inventory.

Fly high. Stay logged in.

— Larry