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Ubisoft booth at the Electronic Entertainment Expo (E3), in Los Angeles, California, on June 9, 2011. (VALERIE MACON/VALERIE MACON/AFP/Getty Images)
Ubisoft booth at the Electronic Entertainment Expo (E3), in Los Angeles, California, on June 9, 2011. (VALERIE MACON/VALERIE MACON/AFP/Getty Images)


Media, entertainment industries take note: The game industry has figured it out Add to ...

Certainly, no other media industry is safe from such criticism, even if there's something more direct about video games, where the consumer has a far greater say in what happens. Regardless, the industry is changing. Since the introduction of Nintendo's Wii console in 2006, movement-based controllers have focused the gaming industry's attention on untapped demographics: seniors and families with small children, who otherwise have neither the patience nor palate to spend hours deciphering an Xbox controller for the purpose of shooting holes through an invading alien horde. Since that time, companies such as Microsoft have staked billions on a vision of universally accessible gaming, all the while trying to remain relevant to the hardcore, button-grinding base.

You can see the tension all around at E3 - the cheery cooking simulator occupying booth space right next to the slash-and-stab mediaeval gore carnival. Massive ads for the latest entry in the Halo or Call of Duty franchises (which likely took as much time and money to make as your average Hollywood summer blockbuster) down the hall from the shoestring-budget indie game. And that tension is producing the kinds of innovative business models every struggling media industry should be studying closely.

One way or another, gaming is going to grow up. And how it goes about doing that is going to have one hell of a ripple effect.

Los Angeles Convention Centre 11 a.m.

Jay Minn won't let me leave until he shows me the fart button. It's his favourite feature in the whole game. Look, look: every super-hero farts differently. Iron Man farts dollar signs (his alter-ego is a billionaire, after all). The invisible woman blushes and, you guessed it, turns invisible. Mr. Minn is positively giddy.

Gazillion Entertainment's booth space is up on the second floor of the west hall, away from the uninhibited booth-babery and bass-heavy sound effects saturating the main show floor below. Instead, their neighbours on the second floor are other small and medium shops, as well as a room reserved by the Entertainment Software Association for a workshop titled "Understanding and combatting game software piracy" (when a reporter tries to attend, he is told the workshop is for law enforcement only).

Mr. Minn is one of Gazillion's 200 or so employees, and the developer primarily responsible for a game called Marvel Superhero Squad Online. Unless you're an industry watcher, you've probably never heard of the game, the developer or the company. And yet it's up here in this out-of-the-way booth (Gazillion hands out beer mugs and pizza in an attempt to lure passers-by) where you'll find the kinds of innovations that are changing the video game business, and will probably change a whole lot of other businesses, too.

You can play MSHSO right now. It's a Web-based game, playable on a browser and basically free. The game is essentially a very stripped-down version of the kind of mini-mission multiplayer games familiar to fans of Diablo or World of Warcraft: you pick a character, complete missions and, in the process, collect loot and increase your character's various abilities. Only instead of orcs and barbarians, MSHSO's characters are cartoon representations of licensed Marvel superheroes. The decision to go with Marvel characters was in large part a business one - Gazillion wanted to hit a sweet spot by building a game that fathers and their kids would enjoy (the ability to make your character fart is apparently a prime example of hitting this sweet spot). The missions are designed to take between 15 and 30 minutes - a small enough time commitment to play right before dinner or bedtime.

Throughout the free-to-play game, Gazillion has found new ways to make money. Alongside the available characters is a special one you can only get by entering a code found on pizza takeout boxes from a restaurant the game developer has signed a promotion deal with. When the movie Thor came out earlier this year, the title character popped up in the game as part of yet another promotional deal.

Even though the game is free to play, you can still purchase in-game currency to spend on various character abilities and perks - especially handy if you don't feel like spending the time needed to collect those abilities and perks the hard way. You can even buy subscriptions for $10 a month or $80 a year, which gives your character the ability to earn the in-game currency you'd otherwise have to pay for separately. In another Gazillion game, you can pay a few in-game coins every time you die so that your character doesn't re-spawn back at the beginning of the level. You don't need money to do anything in these games, just to make life easier.

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