Odd Lots - Magic the Gathering's Creator Wants to Create an Even Better Game

Episode Date: November 23, 2023

 Since bursting onto the scene in the mid-1990s, Magic the Gathering has become one of the most popular games of all time, with millions of players collecting cards to battle each other in an imaginary fantasy realm. But Magic's early success came with a problem: the price of the game's most powerful and rare cards surged along with its popularity. Eventually, Magic's creators worried that the game would become too expensive and was at risk of becoming a short-lived fad. So, how do you pop a bubble in collectibles without completely alienating collectors? In this episode, we speak with Richard Garfield, the creator of Magic the Gathering, and Arka Ray, a long-time game developer at Microsoft who's now CEO of Richard's new gaming studio, Popularium. They talk about the surprising parallels between MTG and central banking, what they've learned from Magic, and how they're applying those lessons to Chaos Agents, Popularium's first new gaming launch. See omnystudio.com/listener for privacy information.

The news doesn't stop on the weekends. Context changes constantly. And now Bloomberg is the place to stay on top of it all. Hi, I'm David Gurra. Join us every Saturday and Sunday for the new Bloomberg this weekend. I'm Christina Rafini. We'll bring you the latest headlines, in-depth analysis, and big interviews. All the stories that hit home on your days off.

And I'm Lisa Mateo. Watch and listen to Bloomberg this weekend for thoughtful, enlightening conversations about business, lifestyle, people, and culture. On Saturday mornings, we put the past week's events into context, examining what happened in the markets and the world. That on Sundays, we speak with journalists, columnists, and key political figures to prepare you for the week ahead. Join us as soon as you wake up and bring us with you wherever your weekend plans take you. Watch us on Bloomberg Television. Listen on Bloomberg Radio, stream the show live on the Bloomberg business app, or listen to the podcast. That's Bloomberg this weekend.

Saturdays and Sundays starting at 7 a.m. Eastern. Make us part of your weekend routine on Bloomberg Television, Radio, and wherever you get your podcasts. Hello and welcome to another episode of the Odd Lots podcast. I'm Tracy Allaway. And I'm Joe Wisenthal. Joe, did you ever play Magic the Gathering? No. Really? I've never played it.

The only game I know, I mean, I spent some time playing chess. Of course. Yeah, we've talked about on the show before. And then outside of that, it's like, I never had the capacity in my life to like, really learn a new game. So it's like, you know what, I'm going to play chess, try to get better at it, play on my phone. But I've never like then, it's like,

I want to play some other game. Man, you need to branch out. I know. I just don't want to start. You know what the thing is? I don't want to start from the beginning. I'm just like, I'm like too old for that. That's how you've learned new things.

Okay, well, speaking of being old, I spent countless hours in middle school playing Magic the Gathering. It was a huge thing in, let's see, This would have been around 94, 95, and almost everyone I knew at the time was playing it. Where were you living in 95? I was in Chicago. Chicago, so that's partly why.

And, you know, every recess was taken up with Magic the Gathering tournaments. Totally. And I really enjoyed playing, but for me, the collectibility of the cards was probably more interesting. I was obsessed with the cards. One of my best friend's younger brother was like really obsessed with the cards. In the game, he was like, oh, I got the wall of brambles or whatever it is. The wall of brambles. No.

That's not? I don't think so. Although it sounds like it could be, to be fair. I remember I had. No, it is. Is it? There's a card called Wall of Brambles, I think. Anyway, I just remember that, you know, I think it's, oh, look, you can buy one for 20 cents.

So I guess it wasn't a very valuable card. Anyway, I was like around people who were really into their cards. I was magic adjacent. I have had friends who play it. I didn't realize up until you played it. I was like sometimes when I would go like to like the bookstore play chess or the game store. There would be other people playing. So I was around the game.

But I just never played it myself. And I spent so much time. I had so many cards. I had valuable cards. I had a Chavon dragon at one point. And I really, thanks Joe. Wow. Thanks for your feigned enthusiasm.

Okay. But this brings me to a serious odd lots-esque topic, which is Magic the Gathering is really interesting, not just because it was one of the, possibly the most successful card game of all time. But it had a lot of sort of economic aspects to it. So there was the card collection. And then you can imagine within the card collection aspect of it, obviously the goal is to play and win the game. But then you had this whole sort of market spring up around these super valuable cards. And there is a big discussion about whether or not the value of the cards was actually making the gameplay worse. Yeah.

So this I'm familiar with. And intuitively you could sort of like get this phenomenon, right? Because a card can be useful in the game. But a card could also just be like a valuable thing that people buy and sell on eBay or Magic the Gathering online exchange. things like that. But then the question is like, do they align? Does the collection of the cards lead to optimal gameplay, suboptimal gameplay, etc? Like, you could see how like the value of a card from a monetary standpoint and the value

of a card from a gameplay standpoint might be like linear related, but might not be like perfectly aligned. Right. And the other interesting thing is Wizards of the Coast, the company that actually made magic. At various times they tried to fix this problem. So they almost acted like a central bank of the cards in terms of issuance. Like they would increase the supply of cards or decrease the supply of rare cards as needed to make the game more interesting. So that's kind of fun too.

But anyway, I could go on about magic for many hours still. But I am very, very excited to say that today we're going to be speaking with the creator of Magic the Gathering. Wow. have Richard Garfield on the line all the way from Sydney, Australia. And we also have his colleague, Arka Ray, the president and technical director of Popularium, which is the new gaming company that he's setting up with Richard. So very excited to have them both on the show. Richard and Arka, thank you so much for joining our thoughts. Well, hello. It's a pleasure to be here. Love talking about games. All right. Thank you both. Really appreciate. I really appreciate you

having us here. We're really excited to be here. I hope my slightly sarcastic tone to Tracy was not in any way coming off as dismissive towards the game. No, it was actually. Mocking her just a little bit. Mocking me is okay. Mocking trade, but I do not want to make it clear that I have no condescension whatsoever to the game.

So I just want to get, I feel bad about that already. I think I think you set up a lot of great stuff there for us to get into with, with Richard. So let's do it. Yeah, I wanted to say that back in the 90s, I thought that playing one game like chess was like reading one book or watching one movie. But I very quickly got past that because I realized games have this really special thing where the more you play them for a lot of games, the better they get. And so there's something which doesn't really line up with a lot of the other media.

So I think that is a perfectly good way to be. Well, there's a very good observation. Maybe I should play more game. Joe over here, just reading one book all his life has said. So Richard, maybe just to begin with, you know, I use the sort of economics framing to describe some aspects of magic. But do you think that's like the right way of thinking about it as a sort of ecosystem or market of cards? Yes. I think it's the most important thing with a game like magic is the economics around the cards. And it doesn't take much to shift the game from being something which isn't primarily a game, but is more an economic tool. And that is, in fact, you mentioned that Wizards acted like a central bank. It was very much the case back in the 90s, maybe 95.

where the game, the price of the game was so out of control. There was the speculation bubble, and there was a conflict within the company. A lot of people thought this was amazing because who doesn't want their product to hit the shelves and immediately be worth three times as much. But from the people who were actually making the game like me, it was terrifying because if you can't afford the game, you can't play it. If you can't play it, then it's not really a game. So we very intentionally overprinted the set Fallen Empires,

and the market crashed hard, and people said that was the end of the game. But as it worked out, play sprang up, because at its root, it's a, it's a, it's a, a game, it's a strong game, and the community loves the game, and then, you know, it flourished. So ever since then, I've been really skeptical of games and game companies, which are intentionally trying to keep the prices of their cards or components high. You know, one thing, and I definitely, I don't know if we want to even like go down this story. I mean, I certainly had that thought like in 2021 when they were trying to do like NFT related games.

It's like, what was the point to play the game or is the point? The thing, it didn't seem like any of those games were fun. Something I'm curious, though, in 1995, we didn't, you know, eBay, I don't think it really existed. Did it exist by 95? Barely. I mean, if it did, it barely did. It hardly did. hardly anyone was using it.

How at Wizards of the Coast, were you even monitor, were you able to get like real time or semi-real-time feedback on price to find that optimal equilibrium between the value of the cards and the amount of gameplay there was? I'm not sure what tools were being used, but I know we had data. And in fact, the data was, I'm not sure about eBay. It might have been eBay, but the,

the data was so clear that I know at least one doctoral pieces that was put together using data from Magic the Gathering. And the idea there was that the person who did it, the one I know of was Dave Riley, he found it as a perfect tool to test different auctions to see how that affected the final prices of the sales. That's super interesting. So, Richard, one of the things that was sort of built into the game, at least initially, was the idea of actually playing for ante. So if you lost, you would have to give up a card from your deck to your opponent. And it was sort of one way of actually building up your decks and, you know, becoming an even better player. How come you built that aspect of it into the game?

When we began the game, I did not anticipate it being the success it was. And in fact, I expected players to buy one to four decks maybe. And so I wanted to make sure that there was some method for there to be a variety in what players had, even if they stopped buying cards. Now, of course, they can trade, and I expected that to be a part of the game, but I also knew that there are people uncomfortable with trading. So I thought that anti would be a good way to get that circulation of cards, and they're also acted as something of a leveler between decks.

If you've got a very valuable deck, then you're going to be anteing more valuable cards. this idea there were some dedicated advocates of it it was a very exciting way to play but it was pretty clear very early on that we were going to have to drop it because so many people hated

losing the cards and so and so I imagine by the second expansion there were no more anti-cards and it was phased out Joe one of my greatest triumphs as an 11 year old was

I won a signed card in Magic, the gathering, it was signed by the artist, and the person I won it from was very upset because we didn't, you know, we were all 10 or 11 year old kids at the time. We didn't have a lot of signed cards circulating among us. Can I say, I did not realize that the card loss, I sort of assumed that still existed that you could lose your card. It shows you how much that I knew about magic. For some reason, I thought maybe that was still part of it, but I could see, that would seem really stressful and I would not want to collect a deck or I would not want to be a parent

buying decks for my kids, my 13 year old kids, and then having them lose them during lunch at the game. So I could see why that wasn't a particularly stable thing. I should want to interject there on that though, that like today it would be completely a non-starter and one of the one of the things was that when it was published, we didn't see them as being valuable in the way they are today. Very quickly, there was a price set on them. And so once there's a price set on them, they actually are gambling when they play for anti.

Yeah. Which could be fun, and gambling is fine, but I don't know if you want kids gambling, I guess. Yeah. Right. And, yeah,

back when it was playtest cards and when they were first out, when I was picturing them just being treated as these sort of components you might have sentimental value to, it was different. But once they became, become cash. Yeah, it's not really an acceptable thing to bake into your game.

This is Tom Keane inviting you to join us for the Bloomberg Surveillance Podcast. It's about making you smarter every business day. I'm Paul Sweeney. We bring you complete coverage of the U.S. market open. We cover stocks, bonds, commodities, even crypto, all the information you need to excel. And I'm Alexis Christophores. Bloomberg Surveillance also brings you the analysis behind the headlines. We do that through conversations with the smartest names in economics, finance, investment, and international relations. We do all this live each and every weekday that bring you the best analysis in our daily podcast.

Search for Bloomberg Surveillance on Apple, Spotify, YouTube, or anywhere else you listen. On the East Coast, listen at lunch. And on the West Coast, listen as soon as you wake up. That's the Bloomberg Surveillance Podcast with Tom Keene, Paul Sweeney, and me, Alexis Christophorus. Subscribe today, wherever you get your podcasts. Bloomberg Surveillance, essential listening each and every business day. So just to sort of get the narrative right, can you just give the quick overview of how long were you involved? You're the creator of Magic the Gathering.

Wizards of the Coast, it existed as a game publishing company prior to you linking up with them, I think. And then obviously it took off. How long were you sort of involved with the business of Magic? I was with Wizards until about 2001, so that was about eight years. I mean, I guess maybe 10 years, if you go back before Magic was published, since technically, I guess, was working for them then. But, yeah, when Hasbro bought Wizards, I was around for a little while, but then went off on my own. So, Richard, just going back to the very beginning when you actually came up with the game, I think I read somewhere that you're a mathematician or you studied mathematics at university.

Did that influence the way the game was designed at all? I was actually teaching math at the college level, and it probably did influence the design of magic. But I always like to point out that when you're a game designer, sort of all subjects are grist for the mill. just like being an author. So if you had an economics PhD or studied literature or, you know, anything, it will affect what you write about and it'll affect what sort of games you make. And Arka, I want to bring you in as well because, of course, you are now working with Richard at the new gaming company Popularium. Did you play magic when you were younger? Yes. Yes, I did. And, you know, I grew up in India. and it was a it was a very insulated community when it came to game to games pretty much you know people

cared about cricket and that was pretty much it so I had some cousins over here in the US who would come by and introduce me to you know cool things that they were doing and obviously magic was a big thing so one summer they came over and this was I think yeah 94 95 something something like that. They came to visit and they had these cards that they were playing. And, you know, I was, I was someone who basically when I was five, six years old, I would take, you know, I would make my own versions of monopoly and things like that. So making games was something that was. So when I saw the cards, it was just like, you know, this world of wonder that just exploded. And obviously, I only had a handful of cards. So there's only so much I could do. But

I remember trying to teach everyone I could how to play the game. So, So it, you know, just seeing his name on those gods and, you know, being here now with him, it's the, when did you know, when did you know you wanted to make a career in gaming? I mean, I imagine, it's funny. You said that my daughter is really, she's seven, she's really getting into Monopoly right now. It's the first game that she's really into, and that's really exciting, and she's starting to develop strategy, et cetera. When, in your mind did it go from, okay, you love playing. games, the cards were sort of fascinating to you to thinking, oh, this could be a career of

building gameplay of various sorts. Yeah, you know, and it sounds cheesy, but it actually was around the time I was 11. I switched schools because I switched cities that my parents were living in. And it was the first time I was exposed to a computer and programming. And as soon as I, you know, it was like basic or something like that was the language. And as soon as I got one, you know, I started like writing this quiz game. And that's all I would do, you know, when I was on lunch breaks and things like that. So, and then obviously I discovered actual games and, you know, got a computer at home and played Doom and things like that.

And then, you know, people would ask me, okay, what do you want to do when you grow up? I'm like, oh, I want to make video games. And often, who are like, what are video games? So it was, that's kind of like why I immigrated to the U.S. I like came here to study computer science specifically because. I wanted to learn how to build games and then was fortunate enough to join Xbox in the early days of Xbox 360. And that was, you know, the winding part that took me to meet Richard and Scaf, who is Richard's game design partner back in 2011, 2012 when I was starting my first company. And here we are 10 years ago.

I definitely want to get into the new game that you're launching with Richard and how it's sort of maybe similar and also different to Magic the Gathering. But before we do, I just have a few more questions about magic. Just humor me and let me relive my childhood. Tracy, if I were interviewing the creator of chess, I would have a thousand questions. So you go to town. So, Richard, you know, you described that analogy of Wizards of the Coast sort of acting as the Central Bank and deciding at one point to flood the market with new cards in order to bring down prices in the secondary market and make it. more equitable so that everyone could have fun playing the game. Can you talk a little bit more

about what that decision was actually like? You know, you're in the room at Wizards of the Coast. What are those conversations that are happening at that time? Wow. Well, there were a lot of people involved with magic and sort of on the sidelines of magic who saw it as a fad. And they saw it like, you know, I don't know, what fads are, cabbage patch kids. Beanie babies. Beanie babies, there you go, and baseball cards. And that when you had a speculation bubble, it was going to crash.

And that was the, and the best you could do was ride that out. And I thought, and we in R&D thought that that was, that was not going to be healthy for the game. And we had some faith in the game in the sense that we had been playing with the first set of cards for over two years. And the playtesters were just hooked on it. They loved it. And so if it crashes and goes away,

you know, that won't be shared with anybody. There won't be any long term to the game. And so within Wizards, There were lots of very heated arguments that, you know, that if you overprint it, some people believed it was going to crash and then we were, you know, basically the game was done. And other people who thought, if you overprint it and it crashes, that'll give players an opportunity to actually play the game.

And since I was a committed crasher and the president of the company, Peter Adkisson, and took my advice seriously. He was a committed crasher, and so we went through with that. And it really, the sort of the reputation that the set, which crashed it, fallen empires got,

was very bad. I mean, it looked, you know, people hated it. They hated the set. And, but it wasn't about how it actually played. It was about the fact that it was cheap.

It was, they could, they could buy it. remainder. But, you know, the number of players just exploded after that. And, and, and, and we, we began to reformulate how we printed the cards to make it so that anybody who joined the game wouldn't have to pay secondary prices, secondary market prices that were substantially above, um, buy from the company. Well, so I understand the sort of, and I like the way you put it, you're a committed

Crasher. You want people to play the game. You want low prices. And that's, I think that's awesome. Or it sounds really cool. But it still seems that even within the committed Crasher philosophy, the challenge may not be, okay, you want to have the cards cheap so everyone can play them. But you still need to get the proportions right in terms of you can't make, there still has to be some variability between the really powerful cards, can't be printed as much as the less powerful cards. There has to be some rarity. How do you calibrate that aspect of it such that you get the proportion of powerful to less powerful cards right, even within the crash mentality, the crash framework? So there's a misapprehension

there that's underlying a question, which is I was also from the start a big advocate of not making the rare cards more powerful. Now, there were more powerful rare cards, but if you make the common cards very broadly powerful, generally useful, easy to use, then people who buy not too many decks have less of a disadvantage against somebody who gets a lot of decks. And so this was early on one of the ideas. I had lots of ideas. Some of them worked like this, and some of them didn't.

like anti. But this approach makes it so that your power goes up, you know, logarithmically as you purchase decks at the beginning, rather than linearly. I see. And, and, and so now the value of the cards, that's something different. It does have something to do with the power of the cards, and there were powerful rare cards. I certainly wouldn't deny that. But one of the things that I enjoyed doing when Magic first came out is going to game stores across the country and and playing against players, gunslinging we called it. I think that became a term we stopped using. And I would play against them with a deck of all common cards. And my record against the, you know, the champs of the stores was 80% or something like that. And people would bring out their their, their

their decks with their black lotuses and their vampires and their shiven dragons and I would clean their clocks and it would be all top to bottom common cards and it's just because you know I've been playing many years longer than them and was a better player and recognized the power that was there in the common cards now the best decks of course are going to be you know a mixture but but you look at the top decks even played today and there will be a good you know, good chunk of common cards that are being played by all the players. I guess I just sort of assumed Tracy that there must be must have been some relationship between like, oh, if you have these really valuable cards, they must be overwhelmingly powerful.

So I did not realize that. Also, it's just sort of funny to imagine, you know, the ultimate creator of the game popping into the local, the local D&D board game store and whatever town and cleaning all the local clock. Right. Some guy who's spent. countless hours, you know, building a deck of really valuable cards, suddenly losing to someone who's playing with some really common ones. But just on this note, Richard, you mentioned the Black Lotus card, which of course is probably the most famous card in all of magic history. And I looked up on one website before we have this conversation. And I think the pricing for like the most rare version of the Black Lotus was something like $22,000.

I have no idea if that's accurate or not. It seems slightly inflated. Wait, I see half a million. Really? Wow. Yeah. Yeah. I think 22,000 is, I saw an article about a proxy Black Lotus. That is one that the players made selling for some incredible amount, like $20,000.

But the actual one is closer to half a million? Is that right? Maybe I was looking at the wrong version. Yeah, 540,000. I could be all. I don't have access to my. 28, 2023 in auction house, 615,000 for a Black Lotus. Okay, well, this gets to my question.

Are you surprised at the secondary market values for some of these cards nowadays? And especially because this kind of gets to the other thing that you did in order to make gameplay more interesting and more fair is I think at one point for the pro league. And yes, Joe, there is a pro magic league. You banned the use of certain cards like, I think, Black Lotus, like the really powerful cards you couldn't play with anymore. So I guess my question is, why do they still have or seem to have so much value in the secondary market if they're not allowed in some of the games? That is one of the most important tools we used for making the game accessible to players coming into it, that is not making it so they felt like they had to buy a black lotus.

The tournaments and the environment which Wizards supports is only the last couple years worth of cards. And so if they're beyond that, players can still play them, of course, because they own them. And there will still be events set up around them, but that's not where the focus of the companies of tournaments and play is, which means if you come into the game, you know that you're not competing against black lotuses and all the old cards. And so it wasn't just Black Lotus that was banned. It was basically any card that was too old became, I forget what they call it,

but I don't know, a legacy card. And those, there were special legacy events, but that wasn't part of the current game environment. And that was one way we managed to keep it so that the car, prices were under control, and yet you have this long-term collectability. So it was collectible like stamps, but not like beanie babies. Yeah, I didn't realize that the older cards were banned in pro play. I guess I probably didn't play magic long enough for that to kind of be an issue, but that's interesting. Well, to clarify, there is, there are like two form asters, like standard and the other one. The standard is the rotation that Richard is talking about. You can't

play, anything that's modern, which is like, I think after 2000 something, it's considered modern in like non-pro tournaments and so on. But there is also a band list, which, you know, Richard might want to talk about, which Black Lotus and cards are on, which will never be reprinted, which does contribute to a great extent to the incredible value, something like a Black Lotus, because it will, there are, there's a possibility for a legacy card, as Richard said, to be potentially reprinted. And it's considered exactly the same card as far as game is concerned, but there will never be another Black Lotus printed because of many interesting reasons, which I don't know if you have time or Richard was to go right.

I'm curious. Yeah, it's actually worth pointing out. Like, it's a very sticky relationship between the power of the card, how many have been printed, and whether it's available, whether it's in tournaments. So, for example, very early on, we realized that when we reprinted it, an old card, which had some cachet to it, the price on the secondary market of that card would go up. And the reason for that is because that meant the card was legal for tournaments because it wasn't an old card anymore. You could bring your older version, which might have different art

or a different cardboard or something like that. But it seemed contradictory that you're printing more of them and now the price goes up. Hmm. Arka, I have to ask now, what was your, I don't want to say most valuable card because it kind of undermines a lot of the purpose of the game. But what was your favorite card that you accumulated when you were playing? The time that I was playing magic probably the most was when I was at Microsoft just because, you know, that was one of the things that we did. And at the time, I got really into black, like all sorts of combinations of black. So I got a, you know, got into black white, black red, etc. So there was one card that I think it was a gold card that was printed in like M11 or something like that. That was called the dark tutelage.

And that just had the most, the coolest art on it, if you want to look it up of this guy with a blindfold. Guy was this blindfold and eyeballs and this like demon-looking character like getting I was just a it was a it's a really fun like you know like it combos really well with red cards also um so i just i just really enjoyed the mechanic the both the the life gain and life loss uh mechanic as we're sources this is caroline hyde and i'm ed ludlow inviting you to join us for bloomberg tech a daily podcast focusing exclusively on technology innovation and the future of business every weekday we bring you the top headlines from the world's biggest tech companies. From finance to

defense, AI to entertainment and from startups to the magnificent seven. We highlight the latest stories of the people and companies pushing the tech sector to new frontiers and the politics that shape global tech markets. We do this all every weekday. Then bring you the most important conversations and analysis in our podcast. Search for Bloomberg Tech on YouTube, Apple, Spotify, or anywhere else you listen. Join us every afternoon on your commute home. and stay ahead of the tech news cycle. That's the Bloomberg Tech podcast. I'm Caroline Hyde in New York.

And I'm Ed Ludlow in San Francisco. Subscribe today wherever you get your podcasts. I have an embarrassing confession, which is I was scared of the black cards when I was growing up. I never played with them because some of the images of like, so the black cards for people who don't know are sort of associated with like death and scary things. And, you know, there's lots of demons and pictures of things. skeletons and things like that. And they freaked me out when I was little. I was scared of them. Okay. Can we talk a little bit about the new company and maybe Arco, what do you describe?

What is popularium? And in the world of gaming, what are you trying to solve? What do you want to do that isn't being done elsewhere in the gaming world? That's a great question. And, you know, I think it's best answered a little bit through the story of how actually we started Populararium. Great. Because, yeah, I mean, on one hand, I've been dreaming of, you know, starting a games company since I was a kid. But you know, how things go. Like, I started my company and, you know, I'm a technical person. So I got into building enterprise software for a while.

And that was all fun and all that in a different way. But always want to come back to games. And I had an opportunity a couple of years ago because of a combination of events with my prior company and, you know, some availability of some financing, COVID giving people the opportunity to like basically become much more comfortable with completely distributed development systems because, you know, games especially has been a very, you know, you go in, you build games, you know, and the whole like, you know, classic crunch mentality that you're sleeping under your day. desk before you ship. So all of those things was like, you know, for me, was the right time to start thinking about putting something together. And it was really accelerated by two things. First was that for me, what has always been very interesting is our games that essentially through gameplay create a new formats and then be generate narrative. out of the pure gameplay itself.

And something that Richard's games have always done is basically whether or not you understand the lore of the magic universe, let's say, or Netrunner or whatever might be, when you're playing the game, the game is creating a narrative for you. That duel that you're having with summoning the specific creatures, the counters, you know, the stack, it's like if, you know, actually someone should do it if they haven't, is you can actually take the output of a magic game

and maybe actually train a generated of AI, like an LLM or something like that, to actually output a wonderful narrative of like, you know, what was the battle? And that, you know, is created purely through gameplay. And for me, we really hadn't explored that fully in a digital format, the power of that fully in a digital format. And when I started talking to Richard in 2021, late 2021,

about some of these ideas, Richard and Skaff, you know, and Richard can tell you about Skaff, who's just an awesome person and, you know, in his own right. My goal was that, okay, what can I do to create a playground for you guys, where you can take the ideas that you've been cooking for a long time. And the thing that Richard and I and Skaf resonated on pretty much right away, and we have known each other for a while, so we've kind of talked about this over time, was the idea of empowering gamers to pursue their fun, their way,

while also leaning into gameplay innovation. Because I think that one of the things that doesn't really hold gaming innovation back, but definitely slows it down, is once something works for a certain group of people, a bunch of other money, a bunch of money goes into building, facsimiles of that because you know that people are going to have fun in a certain way. And what's amazing, another amazing thing about Richard's work is that exactly what I was talking

about earlier with that whole like black approach and, you know, with basically you saying, crazy that, that, you know, you were not really into the black decks at all. Some of them are scary. No, no, I'm completely with you. Like, you know, some of the, they are genuinely not like pleasant things to look at. But I can't imagine playing magic without, you know, black cuts. But there's an entire like gamut of folks such as yourself who, you know, that's not. So that is what's so cool about.

So how do we lean into innovation while also empowering gamers to pursue the joy of gaming, the fun of gaming, in the way that they want without feeling like, oh, you know, I'm not good enough or my fun is not fun enough unless I'm winning all the time. And that was my philosophy and, you know, what I wanted to lean into. And obviously we've seen over and over again. And, you know, while I was at Microsoft, we built Xbox Life, pretty much, you know, from the ground up. So I've seen like how much, how hard it is to keep toxicity out of communities. And one of the ways that you can actually do that is if from the germination

of your game, you are letting people genuinely lean into fun and telling them, you know what, no matter how you want to have fun, it's okay, we will accommodate and so on. And then what Richard, you know, kind of had in mind was actually something that he had been thinking about and working on for 20 plus years. And maybe Richard, I want to maybe ask you to talk a little bit about how things came together before we actually put the company together. Yeah. So this concept that I've been working on for 20 plus years was something that had been

gnawing at me ever since Magic came out, which was that the way its popularity in some ways undercut one of the things which I really loved about the game. And that was that when you first play magic, even today when you first play magic, but originally very much so, it was a game filled with sort of endless possibilities and treasures. And your deck was distinct. It was yours. And your friends' decks were distinct as well. You had the sense that the world was infinite. infinite, but then when you start playing more and begin to play tournaments, the emphasis of the game is on

constructed decks. That is, you choose which parts you want to play, and you play them, and they're readily available, so they become more like commodities. And this is not the way we played originally. It's a fun way to play, so I don't mean to take away anything from players who love that way of playing, and there are plenty. But when we first played, we played with this very limited pool, and it was exciting in sort of this different way. And so the way I came up with to recreate that was to make it so that players' decks were unique. So that is when you get a deck, it's your deck, and you can trade the deck, but you can't break it up. And so I wanted the back of the cards to be unique.

and it took a while for printing technology to catch up with that. But Key Forge was the first unique deck game, and every deck in that game is unique and has its own unique name. And the resulting play was so interesting, and the audience for it was so sort of thirsty for, this sort of gameplay that didn't involve making decks and collecting cards that I began to think about how to apply those ideas to other games. In particular, you would think that even though printing technology took so long to catch up

to this concept that digitally, it shouldn't be that hard to do. When I was talking with Arca, he was asking what he could do to bring some of our ideas the life and I was just coming off of dealing with many different companies who wanted games but they were all very concerned with how limited they make it so the cards were immediately valuable. They were talking about like play to earn money and putting out a certain limited number

so that people's initial investments go up and so they were approaching the games entirely as sort of this, this, well, what we began with, this economic, they were building it on this foundation of economics rather than on the foundation of gameplay. So ARCA was very interested in supporting this idea of building the game on a foundation of gameplay

and deal with the economics as sort of a secondary thing, which is there to sort of maximize the enjoyment of the game to the play. rather than return on investment for the player. Tracy, this reminds me, by the way, there is a sort of corollary in the chess world, which is, you know, you think of chess as a game. But so much, and it is, but so much of modern chess is just sort of wrote memorization

of the first 15, 20 moves. And so there's this other version of chess that I think Bobby Fisher came up with Fisher Random chess in which you don't know in advance the order of the pieces that are going to be. So it's gameplay from the beginning, there's like numerous ways the pieces can be ordered on your back rank

so it's gameplay from the beginning instead of you don't have like the queen in the middle yeah and so what it does is you have to figure out the game right away rather than you have 25 lines committed to memory oh that seems much more interesting yeah theoretically I think it's a better game the pros don't really play it but I do think

it's widely considered to be more interesting gameplay but you know but you know what's interesting is if you I mean I'm showing I'm sure you've seen this. And Skapp and Richard will tell you all about this also. But if you look at, you know, folks like Carlson, what they try to do in their games is basically try to move to a position as quickly as possible that has not been seen.

That's novelty. Yeah. Yeah. That is exactly the analogy. I'm glad you picked that. That's exactly the analogy that, you know, what Richard explained is that, like, the idea of going in with, okay, you know the cards, you know the specifics of the units of power. but the combination, the engine that that builds with the deck is not something that you've ever seen before.

And that you have to figure out in real time. And that is what's interesting about it. So Richard just touched on this idea of pay to play and the fact that there are games out there that kind of focus on building up the value of existing assets or cards. And maybe this is one for both ARCA and Richard. but how do you resist that temptation? Like how do you actually monetize the game? Because I imagine in the gaming industry, the temptation now is to ring as much money as possible out of players.

And it does seem like some of these are, you know, expensive to run, expensive to design, expensive to produce. So how do you manage to do it where others are focused very much on the revenue opportunities? This goes back to the question, Tracy, that Joe asked earlier, which is one of the fundamental philosophies that we have behind doing this company. Because Richard, myself, John Scaffi, we all have done things in the past where, you know, at this point of time, we want to build something that brings us, you know, true joy and satisfaction. And one of the things that we all very much agree upon is that if you bring,

if you bring people true joy and true fun through gameplay, that translates to, um, to economics in a much more scalable way than if you try to build gameplay experiences that are optimized for economics. And you see this happening intentionally and unintentionally. You don't have to just look at recent examples. Like if you go back and look at World of Warcraft and the amount of gold farming that was completely not legal, but it used to happen all around the world and the amount of value that was created in. transacted. Why? Because people wanted to use that utility, you know, within the game. And magic, you know, that is just an example, is an amazing, glorious example of that phenomenon that has just

lasted for decades at this point, which is if you create that interactivity, and, you know, I don't mind saying this, one of the geniuses of magic is this idea of massively modular gameplay. that is a term that I know Richard likes, of being able to let people construct the pieces to build their piece of the game in a way that is very flexible. If those two things come together, then the repeatability comes naturally. And I think that a lot of folks who try to essentially start with the economics, start with the business model and then retrofit the gameplay, probably do themselves in their gamers a decision.

service. Anyway, that's something that, you know, very passionate on my part. I don't Richard if you had any thoughts on that. Yeah. I would like to add to that. So there's been many games I've put out and this one we're working on is part of this, where there's some question as to how much value you give to the player who just dips their toe in. And my philosophy on it is if you have faith in the game, you give them lots of play. that's why the common cards were powerful in magic and that's why in key forge uh you uh you get uh your single deck uh has many different avenues that you can play with uh so it is not something where you play with it and immediately get bored there's many different things you can do with it now

the cynical would say well that is limiting your audience because because people are going to buy one deck. That hasn't been my experience because this massive modularity gives a world of variation which people want to explore, but it gives the opportunity for people to get involved with a very, with a very modest investment. And so that's something we're talking about with our game. And I want to see that a player with a single character has. sort of can get an amazing amount of value from that

and not feel particularly limited by that. And that is with this faith that some players will stop there and that'll be right for them, but other players will want to get different variations. When does the new game chaos agents actually come out? It's great question. So basically, just to bring home, the question from earlier.

Richard sort of gave me this one-pageer. This was end of 21, early 22, called Maelstrom that he had written up around this idea of basically what would it be if the deck of cards, each card represented a unique skill that together, skill or ability, that together made up this globally unique superhero.

So the idea would be to have this entire large, you know, 60 plus heroes battling each other. And each hero would be controlled by this kind of unique, invisible deck of cards in the background. And one of the things that Richard was sort of really into at the time was this idea of autobattlers, which is another very interesting genre of games that I'm sure Richard would talk about for a long time. But this idea of autobattlers would basically be that, you know, unlike games where you

need a lot of input, a lot of reflexes or Twitch, an auto battler lets you sort of make some decisions, sort of like almost like a football, an American football coach, make some decisions, call the play, and then see what happens, and then adapt and call the next play. So there's this lean forward, lean back experience.

So Richard was like, what if we blended these two things? And I was like, that sounds amazing. That sounds cool. I want to play an auto battler game. You should, Joe.

Branch out. Experience something new. It is. And that's obviously, like, for people like me who have, like, not played competitively for like 10 plus years.

That's the only way that, you know, I can play something like that. But what was super cool is that then, you know, when we hear Richard Garfield, we think card games. And my idea was that, okay, we're going to build something like Heartstone, but in a big way. And, you know, my really good friend John Bankard from Xbox was actually running the Hotstone product team. So, so my, to my great joy, he was like, yeah, you know what? Richard's on. All the Battlers, I love them. Let's, let's jump on.

But then what happened was when Richard and Skaf came back with the detailed design document. It turned out that it was not just a card game. It was actually a full-fledged, you know, battle royale where instead of, instead of, you know, you controlling your character, your character is this AI controlled bot that you are essentially coaching and giving, you know, good advice to, so to speak. That's cool. And that took it to a completely different technical level, but that's kind of what we've been building for the past year and a half, almost two years. So to answer Tracy's question, the reason why we have to be a question, the reason why we have kind of like talking about all this right now is we just launched what we're calling our pre-alpha.

So we are not necessarily like letting everyone through the door, but basically we're letting a ton of folks through the door to come and experience sort of the first version of the game, give us feedback. And we are hoping to get into alpha around the late spring, so around late Q1, early Q2 time frame when the public, more members of the public can start experiencing. So that's kind of like the early access timeframe that we're looking at. And then we're going to going to be in beta by the end of next year. That's kind of like when we'll be in public. But the reason why we wanted to talk to magic fans, especially,

is because that's whom we are prioritizing is because, you know, even you, Tracy, if you play chaos agents at this stage, you'll be like, oh, I see how this takes some of the core concepts of Richard Garfield game and just translate this, translates it to something that can only happen in the digital format. And that was sort of our fundamental goal. So sorry, that was a much longer answer than your question. but, you know. No, that's very cool. And I am excited to play this game. We just have time for one more question. And this one comes from our producer, Carmen, although I think it's actually for Joe's benefit so that he can branch out into some new things. But other than magic and chaos agents, what games do you like to play? What are your favorites?

Wow. Well, as I said at the beginning, I think there is some merit to really getting good at a game. playing it again and again. And that goes against my curiosity of games. And so I have this tension between wanting to play everything that comes to the market and trying to discipline myself to return to my favorites and play them again and again. But so some of the games which I return to again and again are Hanabi. That's my favorite cooperative game. game. And I am actually playing a bunch of fairy chess right now, which is chest variations. And I play a lost cities, one of my favorite two-player games. But lots of classic games like chess and gin and bridge. Hanabi looks cool.

Yeah, I was just a peat up. Maybe it looks like a fun game. Maybe I'll play it with my family. It's a wonderful game. And I can vouch for the fact that Richard plays a lot of games. And I were talking about this at the top of the hour. Richard is, it plays, and that is actually amazing. Because, like, for me, you know, I would love to play that much. But, you know, I kind of play vicariously through Richard because he comes back and tells me, oh, you know what, you should check that one out.

And that's, you know, I have three recommendations of different sort of fidelity, let's put it that way. One that, you know, anyone who's interested in an auto-battler should check out vampire survivors. That was one of the first games that Richard recommended to me, and it has really blown up since then. So a lot of folks in the gaming community know about it, but it's just a fantastic game. It's just so simple, but so deep. The other one that I highly recommend, it's a completely different type of game, but I'm sure it doesn't get that much coverage. But it's been something that has been a great game for me and my family to play together. It's called The Case of the Golden Idol, which is this little indie game that essentially

gets you to solve this mystery set in the fictional 19th century. Oh, that looks like so much fun. Oh, wow. It is just so cool, you know, like I don't want to give away anything. It's one of those games that you should just go in blind, but it doesn't take, you can probably beat the whole game in less than five hours. And it's just such a fun experience. So always, always fun to support indie developers.

And, you know, for anyone who's not heard yet, I mean, I highly recommend Alan Wake to. It's just, it is just so cool to see that kind of innovation in AAA. gaming and this has just been an amazing amazing year for gaming overall just in the quality of games but something like alan wake do is just like shows us the the next bound the next kind of like boundary that we're hitting in the the blending of like passive entertainment interactive entertainment because you know no one can look at alan wake too like you know there's just stuff you can go and watch uh you know people let's play and things like that no one can look at that and deny that it's you know art so i think at this point of time we've you know crossed that right

that Roger T. Wood's threshold where, you know, gaming is undeniably getting into that category. So it's exciting to see where things go. Sorry, add to that list, my favorite auto-battelers since that's working now, which is Harthstone Battlegrounds. I think it's really added a lot of innovation to the autobattler category. Well, Arka and Richard, I think you're both going to be responsible for a massive dip in Odlott's productivity as we go off and experiment with all these new recommendations. and of course chaos agents as well. Thank you so much.

That was so great. I'm going to order Hanabi right now on my phone so I get it. I'm going to play more games. Even though I appreciate Richard your endorsement of the single game approach, I think you've actually inspired me to maybe start playing more games. Well, one is a little bit narrow. All right. Richard and Arka, thank you so much.

That was fantastic. Thank you for allowing me to reminisce and be all nostalgic about Magic the Gathering and the middle school experience. Thank you both for having us so much. It was so fun spending this hour. Thank you. It's always fun to talk about games. It could go on forever.

Joe, you're inspired now? Yeah, I am. I'm inspired. I love that conversation. I'm going to play more games, maybe. You know what I was thinking as we were talking about Magic the Gathering and, you know, Richard's purposeful avoidance of building a sort of of ecosystem that was all about the economics and the value of the game.

I was thinking about Axi infinity and how it was kind of like the polar opposite. Exactly, right. I had the exact same thought, which is that that scene, no one could actually explain how that was a fun game. No one even really tried to make the argument that the gameplay was fun. It was clearly all about the value of the various NFTs in the game. It felt like there are two levels to this. So there's the first level, which is that it.

It's not a fun game if you have to spend a ton of money on rare cards, et cetera, and people just get obsessed with collecting valuable cards. That is negative for gameplay. So he talked about he was a pro-crash price. And then there's the other element, which I thought was really interesting, which is that it also ceases to be less fun. If the game becomes more and more about deck construction, what happens before two people sit down in front of each other

and less about the gameplay that occurs when the two people. people are there. And so, you know, just this idea of continuing to pursue fun, active, creative, improvisational gameplay and how to avoid these other traps where other factors start to overwhelm that. I thought it was really interesting. Well, also, ARCA's points about the pay to play model. Yeah, totally. And the idea that, like, you can build a very popular game by purposefully resisting some of that temptation. And I think if you look at something like, magic. The proof is kind of in the pudding, right? Like, people are still playing this game. It's made a ton of money for Wizards of the Coast. I remember, again, in middle school, like, there was a whole network of

media tied to this. There were Magic the Gathering fiction books that I read at the time. Oh God, don't judge me. But, like, this was a huge thing. And it wasn't because the cards themselves were valuable or because players were stumping up a ton of cash in order to play. the game. It was everything. Yeah, it was everything, you know, it was the gameplay and everything attached to it and the community. And it was a fun time. Anyway, shall we leave it there? Let's leave it there. This has been another episode of the All Thoughts podcast. I'm Tracy Allaway. You can follow me at Tracy Alloy. And I'm Joe Wisenthall. You can follow me at the stalwart. Follow our producers, Carmen Rodriguez at Carmen Armin. Dashel Bennett at Dash Bot and Kel Brooks at Cal Brooks. And thank you to our producer, Moses. And on. For more Odd Lots content, go to Bloomberg.com slash Odd Lots, where we have transcripts, a blog, and a newsletter that comes out every Friday, and you can chat about all our episodes in our Discord 24-7 with fellow listeners.

Go check it out. Really fun place to hang out. Discord.g.s slash oddlots. And if you enjoy OddLots, if you want us to do more episodes on the gaming industry, then please leave us a positive review on your favorite podcast platform. Thanks for listening. I'm Michelle Hussein, and for more than 20 years, I was at the BBC. But all the time I was delivering the headlines, I wanted to go further than the news of the day. To spend more time with the people shaping our world. And that's what I'm doing here on this podcast. Speaking to people from Nigel Farage,

Russia needs to be taught a lesson. To tech journalist Karaswisha. And a tech industry is running wild. You know, they've gotten what they wanted and they've seen a huge run-up in their stock prices. This will be a place where every weekend, you can count on one essential conversation to help make sense of the world. So please join me, listen and subscribe to the Michelle Hussein show from Bloomberg Weekend, wherever you get your podcast. You certainly ask interesting questions.