Why Multiplayer Blockchain Products Will Beat Single-Players In The Long Run
There’s an interesting concept in network product design that draws a distinct line between “single-player” and “multiplayer” uses.
When people are in single-player mode, they a use a product as a private, standalone feature.
But as more people use a product in single-player mode, it eventually reaches critical mass.
The network effects of the product manifest themselves — and opens up multiplayer mode.
Think about how Facebook started.
It was essentially an online yearbook for college students. People wanted to share information about themselves and keep in contact with classmates.
That was their single-player use.
Once enough people began participating, Facebook extended to multiplayer mode and began benefitting from network effects.
They started using social graphs and advertising. Users began getting their news and entertainment from Facebook. But before any of this happened, Facebook had to hook people in with a single-player use case.
Like Facebook, single-player use cases are important for growing a blockchain platform, product, or protocol’s initial user base.
But multiplayer solutions will eventually win out in the long-run.
People typically create blockchain products for single-player solutions.
Back in 2015, at Chronicled, our single-player use case was product authentication. If you wanted to figure out if your product was real or fake, you would scan a blockchain-registered PKI (Public Key Infrastructure) microchip or label. You didn’t need a network — aside from the Ethereum network — to get the answer.
Most companies begin by targeting a group of people with a strong need for a single-player use.
They want to achieve a specific goal, and you hand them the tool to do it quickly. You hope they find the tool so helpful, they immediately share it with other people. Other people start using the tool, it spreads organically, and you hit critical mass.
At this point, you have a large enough network to get the network effects. You’ve entered multiplayer.
Because no company can stay in single-player mode forever if they want serious growth.
From Single-Player To Multiplayer
Because blockchain is a network solution, you run into a “chicken or the egg” type of question when you ask, “Do we want a strong single-player use case, or do we want to go straight to the multiplayer network?”
Realistically, you need to offer both in increments to build the network effect.
Let me give you a real world example:
With the refugee crisis in Europe, there are a lot of people without a government issued ID — either because records were lost, destroyed, or missing. Without identification, refugees can’t get access to government benefits and aid, or begin establishing a permanent home.
A single-player use is registering their identification on blockchain, so the individual or government can easily access the data.
But once the user base has grown, and enough people in a country have blockchain-based identification, there are larger possibilities for the network. People can use their ID to open bank accounts, get loans, or start businesses. As the network grows, it possible to build more and more solutions off of it.
Incentives To Play
One of the biggest challenges in getting people to participate in blockchain-based networks is providing the right incentives.
It’s great to talk about giving refugees or people in third-world countries access to a mobile app, but that only works if they’re using smartphones. In many developing countries, flip phones are still the standard.
So, what do you offer them as an incentive to use the system, and stay within parameters they can access? For this example, maybe it be better to offer their data records through text messages.
But individuals aren’t the only ones who need to be incentivized.
Companies also need incentives to offer these solutions in the first place. Regulations are usually a good place to start. Oftentimes, there’s a specific regulation in place with potential to create a multiplayer solution and strong network effects.
For example, if there’s a law that everyone has to follow in pharmaceuticals, then all the pharma companies are aligned in terms of the single-player use case. The network is built around that.
The end goal for these services is to create a multiplayer network or ecosystem that works for everyone.
As more people see the individual benefits, they’ll begin to join the network. And once we reach that critical mass, the opportunities for new blockchain-based services and products will increase dramatically.
Thanks for reading!