The social virtual world hit more than 82 million lifetime users since it started in 2016, and it is available across platforms including Oculus, iOS, Android, PlayStation, Xbox and Steam. The metaverse opportunity isn\u2019t a small one. McKinsey & Co. estimated<\/a> it could hit $5 trillion in value by 2030.<\/p>\n

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Event<\/h3>\n
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GamesBeat Summit 2023<\/p>\n
Join the GamesBeat community in Los Angeles this May 22-23. You\u2019ll hear from the brightest minds within the gaming industry to share their updates on the latest developments.<\/p>\n<\/div>\n

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Here\u2019s an edited transcript of our interview.<\/p>\n
Nick Fajt is CEO of Rec Room. <\/figcaption><\/figure>\n
GamesBeat: What is Rec Room up to now?<\/strong><\/p>\n
Nick Fajt: <\/strong>The biggest thing we\u2019re up to now is just trying to make it as easy as we can for people to build great content and get it distributed to as many people as possible. We\u2019ve been working on all types of tools for creators to help them build the content they want to go build and monetize that content. Some of them are making a living off this.<\/p>\n
Probably the biggest tool in our arsenal that\u2019s about to go out is Rec Room Studio. It\u2019s a plug-in built around Unity. What\u2019s unique is it allows you to use industry-capable tools\u2013if you\u2019re familiar with Unity you can go in and use it. But the magic happens when you press Publish in Rec Room Studio. Typically in Unity you bundle up your app, submit your app to the app stores. But with Rec Room you can bundle up your app, press Publish, and within two or three minutes, the room you built is live on Xbox, PlayStation, Oculus, Pico, iOS, and Android. We think the immediacy of publishing and the ability to push that content across platforms is unique.<\/p>\n
Our goal isn\u2019t to pull in developers who are using iOS or something like that. Really, our goal is to give this capability to people who are right now not capable of building games or getting something shipped on something like the PlayStation. We can help them build their idea and get it out to millions of people.<\/p>\n
GamesBeat: I didn\u2019t want to go too much into fantasy land just yet, but I do wonder about this whole generative AI movement and the combination of that with user-generated content. Is this right up your alley? Do you think some other things might have to happen first before that becomes really useful? Is generative AI possibly going to be useful very soon?<\/strong><\/p>\n
Fajt: <\/strong>I think it will be a powerful tool sooner rather than later. I think it will still take a human to wield that tool, but what you\u2019re seeing is it\u2019s just becoming easier and easier for people to build compelling content. Whether that\u2019s an image or an avatar or a poem, you\u2019re seeing generative AI step into a bunch of these. But there\u2019s still a human giving prompts and contextualizing what comes back. My suspicion is that\u2019s what a lot of this will look like.<\/p>\n
The thing we\u2019re really excited about because of locking in with Unity and doing a plug-in there\u2013as these tools become capable in the rest of the ecosystem, you have a path to bring that directly into Rec Room through Unity and Rec Room Studio. But my suspicion is that you\u2019ll see some stuff in the next year or two in the UGC space around generative 3D content. Right now what we see is just 2D. But I don\u2019t feel like we\u2019re that far away.<\/p>\n
Nick Fajt\u2019s avatar in Rec Room.<\/figcaption><\/figure>\n
GamesBeat: I saw an experimental one with Ready Player Me and their avatars, where they\u2019re going to use DALL-E\u2019s generative AI to create clothing for the avatars. All you have to do to generate it is some kind of text prompt. \u201cI want bees on a yellow background on my jacket.\u201d It\u2019ll generate that. They call it experimental now, but it seems to work better than if I were to try to draw bees on a canvas to put on a jacket. In that sense it feels like some of this is already here, but then there\u2019s probably a lot more potential down the road.<\/strong><\/p>\n
Fajt:<\/strong> Of course. The analogy I keep hearing and attaching to is the calculator. The calculator came along and dramatically changed what the average human could do. But there\u2019s still a human sitting there behind the calculator putting in the equations, contextualizing the output, and coordinating with other humans who are also using calculators. You\u2019ll see the same thing with generative AI. You\u2019re still going to see humans initiating the prompts. They\u2019ll contextualize the data that comes back. They\u2019ll combine that with other creative tasks they\u2019re doing to build something interesting. I can see somebody using it for building terrain in Rec Room someday. Perhaps building custom avatar clothing. That doesn\u2019t seem outside the realm of possibility to me.<\/p>\n
GamesBeat: Right now, what level of competence would you say creators need to do successful Rec Room projects.<\/strong><\/p>\n
Fajt: <\/strong>We think that if you can play Rec Room, you can build Rec Room. That\u2019s the promise we\u2019re trying to make to people. If you\u2019ve played a game like Minecraft, we think a lot of those principles should apply here. We have a tool called the Maker Pen, which is a very user-friendly way of getting into the creation space. That tool can lead you all the way up to Rec Room Studio in Unity.<\/p>\n
It\u2019s not one path or the other. You can build something with the Maker Pen. You can pull that room into Rec Room Studio and edit it there. Or you can build something in Rec Room Studio, push it into Rec Room, and keep editing it with the Maker Pen. We see it as a spectrum, from very approachable for someone who has never touched a 3D tool before, has never programmed anything, all the way up to, hey, these are professionalized tool sets. We use Unity to build Rec Room. We use Rec Room Studio to build rooms in Rec Room. We want to give the same tools we\u2019re using to creators as well. We just want to make sure we have that path where, you\u2019re curious about creation and you can go in and be successful.<\/p>\n
GamesBeat: Do you have some new numbers on how many creators there are now?<\/strong><\/p>\n
Fajt: <\/strong>We broke 1 million creators in a single month. I think the numbers we were sharing were\u2013we had seen more than 60 million users last year. Nine million were in VR. Just the VR users spent 218 million hours in Rec Room last year. That means the average VR user spent more than a day in Rec Room.<\/p>\n
We think the VR space is very interesting. We think it\u2019s still growing very strongly. There\u2019s a group that it really resonates with. We don\u2019t see any signs of that slowing down at all. The thing that makes us excited about those numbers is we\u2019re probably one of the largest VR apps, if not the largest VR app, by total users out there. But you can see that the Rec Room ecosystem extends quite a bit further than VR. You can come in through VR and hang out with your friends regardless of which device they have. You can build a compelling room, and you\u2019re not limited to the VR audience. You can share with the entire world. Anyone with a smartphone can check out that room you built. We think that\u2019s powerful. We think that\u2019s what creators want. They want a large audience. They want to be able to reach across platforms.<\/p>\n
The Artemis Moon Base in Rec Room.<\/figcaption><\/figure>\n
GamesBeat: As far as ways for people to get paid or just gather attention, what\u2019s happening on that front? With Roblox you see that pyramid, where 8 million people have created something, but there\u2019s a top tier of people who make tons of money or have lots of traffic. Does it look similar for you, that breakdown of users who strike it big?<\/strong><\/p>\n
Fajt: <\/strong>I don\u2019t know the specifics of their business, so it\u2019s hard for me to compare. The thing we see in Rec Room\u2013the reasons people are creating content, it\u2019s a wide range. It\u2019s more like YouTube. A lot of people post to YouTube where the goal is not necessarily making money. The goal might be reaching an audience, or seeing a creative vision fulfilled.<\/p>\n
The thing that we are excited about in Rec Room, I think we paid out three times more last year than we did in the previous year. We can keep moving on that trend this year. There are people who make very real dollar amounts. I think we can keep improving that. As we grow, we want to keep an eye on what that payout curve looks like. Is it logarithmic? Is it linear? What we\u2019ve found right now, our goal is just\u2013groups of people can come together, get into Rec Room, and make a living building content if that\u2019s what they want to do. If they just want to realize a fun idea, there\u2019s still a path to that, and we\u2019re excited for them to do it.<\/p>\n
GamesBeat: How do you keep a balance around bringing in professional developers to do something and make that available to everyone, versus letting the community create?<\/strong><\/p>\n
Fajt:<\/strong> There\u2019s nothing we\u2019re doing to stop professional developers from coming in. The way we think about our tools, though, is really, how can we build the best tools for the creators we have right now? Even when we\u2019re thinking about something like Rec Room Studio, that was a request that our existing creators had. How do I import these 3D assets? How do I use Unity\u2019s terrain editor? How do I build these shaders? Something like that.<\/p>\n
That was the group we wanted. We had a great group of creators. How could we allow them to achieve more? How could we raise the ceiling they were bumping into? We felt Rec Room Studio was the right way to do it. That was the impetus. If external creators are very excited to come in and check it out, we won\u2019t stop them. But really we think about the creators we have now first and foremost. That\u2019s the group that has access to it right now. The top creators with good moderation standing are the ones who have access.<\/p>\n
GamesBeat: Is there a particular game that\u2019s been the most successful along those lines? I think Showdown was very popular, the Western one?<\/strong><\/p>\n
Fajt: <\/strong>Yes, we built that. Really, the best way to make sure your tools are great is to dogfood them yourself. We are constantly using our own tools to try to build great pieces of content, just to make sure that we understand the challenges and limitations of the tools, so we can make them better for creators. We\u2019re working on a game right now with Rec Room Studio. It\u2019s a horror-themed game, but that\u2019s all I can say right now. We think our audience is going to get a kick out of it. We hope to launch it with a bunch of new tools that now allow creators to emulate some of the systems we\u2019ll put in the new game. It\u2019s really about us building content to move the ecosystem forward.<\/p>\n
A buggy at the Artemis Moon Base in Rec Room<\/figcaption><\/figure>\n
GamesBeat: I think Rec Rally was another one that was in-house? Is it still just a handful of these titles versus doing larger numbers?<\/strong><\/p>\n
Fajt:<\/strong> We\u2019ll probably make a single-digit number of these per year. Maybe two or three per year was where we looked to get to. It\u2019s not about the games themselves. It\u2019s about making sure\u2013if there\u2019s a game we think creators want to make and it\u2019s not currently possible, let\u2019s go build it and figure out all the tools that we need to have there. We can launch the game and the tools at the same time. That\u2019s the way we think about it. We want to have great games, but also great tools that creators can take to expand the ecosystem after we\u2019ve launched.<\/p>\n
GamesBeat: Can you surmise some things about player behavior during the different stages of the pandemic? I remember that in 2020 everybody was worried and scared, but we had 30 percent growth in users for almost everyone. Then that slowed down in 2021 to more like 10 percent or so. We have a real slowdown now, maybe driven by recession or whatever else, but I see more of the mainstream game companies stalling out right now, and only occasional unique stories. Roblox\u2019s continued growth is unique amid the pullback that others saw when players started going out more again and socializing. Is there a read you have on some of the player behavior and how it maps to different attitudes people have had in the last few years?<\/strong><\/p>\n
Fajt: <\/strong>The enduring trend that I\u2019ve seen is that gaming is eating the consumer internet. If you were exploring the internet 10 or 15 years ago you were using a browser. Or when I was a kid I was using AOL Instant Messenger to meet other people. Today that happens in video games, social video games. Video games are about a lot more than just jumping from platform to platform or shooting in first-person. Video games now mean events. They mean music. They mean fashion. They mean dating. They mean creativity. They mean after-school jobs. All of these things are now happening inside of games. We\u2019re seeing that the pandemic probably shifted an entire generation\u2019s worth of behavior in that direction.<\/p>\n
I think that\u2019s going to persist. The funny thing that I think about, going back to AOL Instant Messenger, my dad didn\u2019t use instant messaging at work. But when my generation grew up, now everybody\u2019s using Teams and Slack for work. They\u2019re using Discord with their friend groups. It\u2019s the way that you communicate. I think you\u2019ll see the same thing happen in games. A whole generation is using video games and video game-like experiences to socialize. As they grow up, that behavior is going to stick.<\/p>\n
GamesBeat: If that\u2019s true, then I guess we may not have to worry so much that we have a temporary downturn. Maybe it\u2019s a recession-driven downturn, but you would still expect the audiences to grow if this was an inexorable force. I think what we have in the last six months is some weakening, at least across the larger video game space.<\/strong><\/p>\n
Fajt:<\/strong> It depends on who you are and what you\u2019re doing. During a recession, I think consumers are looking for cost-effective forms of entertainment. Free-to-play games are a wonderful way to do that. You might see that consumers are more sensitive about hardware purchases. You might see a slower hardware update cycle. The other thing you probably see when you talk about a slowdown, if you were a very aggressive UA-driven game, if that was your growth engine, then my guess is that\u2019s where the pullback is coming from. If your goal is to grow organically through social word of mouth, I think that growth persists and maybe only gets stronger during a recession. People are looking for cheaper forms of entertainment with the devices that they have.<\/p>\n
GamesBeat: Does this kind of cycle cause you to change anything about Rec Room\u2019s strategy? Do you double down on certain things?<\/strong><\/p>\n
Fajt:<\/strong> The way we think about it is how we can double down on making our creators as successful as possible. Especially during something like this time. People are looking for low cost ways to entertain themselves. People are looking for outlets to be creative, to let off steam. Some people are looking for ways to make additional money. If we can make our creators successful, a lot of those things become true. That\u2019s what we put first and foremost. How can we help our creators build the content that\u2019s in their heads and help them reach as large a group of people as possible?<\/p>\n
GamesBeat: Where do you stand on how large a fee to take from any revenue related to what players create? There\u2019s been a huge amount of discussion around that ever since Epic sued Apple.<\/strong><\/p>\n
Fajt: <\/strong>The way we look at things, for these platforms, they have costs. Sony and Apple have costs. What they\u2019re requiring to be on their platform, that\u2019s what we\u2019re willing to do. As far as our own platform, it\u2019s an interesting balance. We want to make sure we pull in enough so we can continue to upgrade Rec Room, its moderation, and its servers. We want to make sure our team is paid, and also make sure the creators are getting a fair amount.<\/p>\n
We\u2019re experimenting with a lot of different paths to help people be successful. It\u2019s not simply what you earn with your room. We\u2019re rolling out a system called Room Rewards, where we\u2019re putting out essentially bounties. We\u2019re saying, \u201cHey, we would love to see a room that\u2019s doing this. We\u2019ll pay this much to make that happen.\u201d Really what we\u2019re doing is recognizing that one size doesn\u2019t fit all for these things. How you help people understand the systems that are there, how you help them be successful doing the things they want to do.<\/p>\n
GamesBeat: What does the road map look like for the things you want to do to help the creator community grow? What else are you signaling?<\/strong><\/p>\n
Fajt: <\/strong>They\u2019re going to see a whole bunch of new tools when we launch our new core game. They\u2019ll have a lot more control over authoring their own interactions. We think we\u2019ll give them a bunch of systems that help them build stickier rooms that have more progression in them. We\u2019re excited about those two things. Obviously we think Rec Room Studio is huge. It gives them a whole new palette of tools to work with.<\/p>\n
Rec Room Studio, we want to make sure that\u2019s a continuation of the tools we\u2019ve already built. We want to make sure that it locks in really wonderfully with the circuit system we built and the Maker Pen. We want to make sure that these are a spectrum of creation. You can move back and forth easily and fluidly and build in the way that you want. It\u2019s really about making sure that all those tools fit together nicely, so that the output is higher quality visuals, higher quality interactions, higher quality meta-systems. That\u2019s the goal, making sure that all the pieces you would expect are there.<\/p>\n
GamesBeat: How many people do you employ now?<\/strong><\/p>\n
Fajt:<\/strong> I want to say it\u2019s about 250 full time. Then there\u2019s quite a large moderation and support staff as well.<\/p>\n
GamesBeat: Are you getting much benefit from AI in your own business? Do you use AI for moderation?<\/strong><\/p>\n
Fajt:<\/strong> We have a pretty nifty setup for voice. We use a real time voice moderation system that\u2019s looking for violations of our code of conduct and flagging those without any human involvement. It\u2019s been really helpful for scaling up our moderation efforts, especially making sure that it reacts in real time. For many of these gaming systems, it\u2019s great to have a Report button somewhere, but it means another player needs to take an affirmative action and write up a report. You need to have a human that reviews the report. By the time all that happens, minutes or hours could have passed. You might have someone inside the game causing a lot of havoc in that time. The promise we see with AI on both the voice side and also some of the room moderation side, you can catch things in real time before any damage is done.<\/p>\n
The polygon desert in Rec Room.<\/figcaption><\/figure>\n
GamesBeat: What do you think about how open the metaverse can be or will be, given there are some standardization efforts getting started? The Linux Foundation has their Open Metaverse Foundation, things like that.<\/strong><\/p>\n
Fajt:<\/strong> One, we don\u2019t use the term \u201cmetaverse.\u201d As soon as you use the term, the next question you\u2019re going to get asked is, \u201cWell, what is the metaverse?\u201d Oh, you\u2019re a metaverse company? What is that, anyway? Honestly it\u2019s probably creating more confusion than it needs to.<\/p>\n
Our view with Rec Room is that we want to be as valuable to our creators as possible. If our creators are telling us they want something, we\u2019re very open-minded on that. The beauty of Rec Room Studio and our partnership with Unity is it creates an avenue for people to bring in concepts from outside of Rec Room. Right now, all the content in Rec Room is built with the Maker Pen. By opening up the path to Unity, we allow for a much wider range of content to come into Rec Room.<\/p>\n
People create this false dichotomy between open and closed. The answer is that there\u2019s no truly, all the way open system. There\u2019s no truly closed system. My guess is, whatever emerges here, there will be some standards. There will be some things that don\u2019t move around.<\/p>\n
GamesBeat: The way I interpret it is whether or not people will own the things that they create in a given world. Whether they can bring things in from some other place or take things out to some other place. Those seem like basic principles of interoperability.<\/strong><\/p>\n
Fajt:<\/strong> It\u2019s hard for me to know. I remember there was this whole debate happening around music. Do you own your music? And it all went away. Is anybody carrying around a giant hard drive of MP3s anymore? No, we all just subscribe to Spotify. No one asks me if I own my Spotify music or if I don\u2019t.<\/p>\n
It\u2019s foolish to think that I, or another company, will figure this out. Consumers will vote with their preferences and their wallets. They will tell us what they want, and the companies that listen to them will survive. The companies that don\u2019t listen will not survive. That\u2019s how I think about it. Let\u2019s listen to our creators and our customers. Let\u2019s see what they tell us about what they want.<\/p>\n
Nick Fajt is ready to answer your questions.<\/figcaption><\/figure>\n
GamesBeat: What takes up a lot of your time right now? What do you delegate, and what do you do that\u2019s more just you right now?<\/strong><\/p>\n
Fajt:<\/strong> I spend a lot of time going through and looking at our top-performing rooms to try and understand what they\u2019re doing, how we\u2019re helping them, and how we might be letting them down. Sometimes I go into these rooms and think, \u201cOh, they clearly want to do a certain thing, but we\u2019ve made it very difficult for them to do that.\u201d I\u2019ve spent a lot of time in all the Rec Room Studio rooms people have published to understand what\u2019s working well and what\u2019s not.<\/p>\n
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I spend a lot of time chatting with other companies. We want to do partnerships with other brands, to help them understand what it could be like to have the NFL in Rec Room, or have the NBA in Rec Room. Mattel has been wonderful in helping us try out some of their brands in Rec Room. We\u2019re starting to understand what those things look like. We\u2019re always staying in touch with the hardware manufacturers as well, learning about what we can be helpful for whatever they have on the horizon.<\/p>\n
And I spend a lot of time hiring. That\u2019s a big part of what we do. I know a lot of people are pulling back. At Rec Room we have a lot of roles open, probably at least 15 right now. We\u2019re hiring a lot of core engineers to help us make Rec Room run on a wider range of hardware. I spend a lot of time doing that. If you\u2019re excited about what it means to have truly cross-platform user-generated content, it\u2019s a really different, unique problem set compared to what you\u2019ve encountered elsewhere in gaming. It\u2019s full of very fun, very challenging problems. We\u2019d love to have more help, so if you\u2019re interested, check out recroom.com\/jobs.<\/p>\n<\/div>\n
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Read More<\/a>
\n Dean Takahashi<\/p>\n","protected":false},"excerpt":{"rendered":"
The social virtual world hit more than 82 million lifetime users since it started in 2016, and it is available across platforms including Oculus, iOS, Android, PlayStation, Xbox and Steam. The metaverse opportunity isn\u2019t a small one. McKinsey & Co. estimated it could hit $5 trillion in value by 2030.Now the company is testing its<\/p>\n","protected":false},"author":1,"featured_media":614328,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2003,37487,46],"tags":[],"class_list":{"0":"post-614327","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-looks","8":"category-metaverse","9":"category-technology"},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/614327","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/comments?post=614327"}],"version-history":[{"count":0,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/614327\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media\/614328"}],"wp:attachment":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media?parent=614327"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/categories?post=614327"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/tags?post=614327"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}

Event<\/h3>\n\nGamesBeat Summit 2023<\/p>\nJoin the GamesBeat community in Los Angeles this May 22-23. You\u2019ll hear from the brightest minds within the gaming industry to share their updates on the latest developments.<\/p>\n<\/div>\n