Archive | October 6, 2012

Technology of the Week: Open source vs. Freemium in gaming industry

Hey guys, for this week’s Technology of the Week, our group will introduce two innovative business models: Open source and Freemium, with regards to the gaming industry. 

The gaming industry has grown substantially over the past 15 years, with sales expected to be $68 billion in 2012. Traditionally, Video Games can be divided into several categories: Console Games, PC Games and Mobile Games. However recent studies showed that big firms have huge overhead costs, not to mention the high costs for development, making consolidation in the industry a more preferable option. 

Open source

An introduction of new way of development is open-source in communities, which use open-source game engines to lower costs. A Game Engine is the foundation of the game, making development possible. This engine takes care of the rendering (displaying what you see), simulation (of movements), sounds, networking and more. These engines are available under proprietary and open-source licenses. Currently 72 open source or free game engines are available for developers to use. There are 10 general used licenses for open source game engines of which PL license, or the variant LPGL, is the most used license.

There are two forms of community game development: Input driven and Coding driven. Input driven game developers are consulting their community for input. Examples can be on new games, improvements, characters, environment or gameplay. This form is actually developing games based on their input. Another form is coding driven, where a community is coding the game itself. Like one can contribute to an article on Wikipedia, one can edit, e.g., a map in a game. These communities consist of non-paid volunteers.

Two examples of open source gaming


QUAKE LIVE is a multiplayer game available on the website for inexperienced and experiences game players. The user is the first person shooter, and the main tasks are killing enemies, completing game assignments and gathering items. The game has fifty free –to-play standard arenas and five free game modes.

QUAKE LIVE released an open beta version of QUAKE; other developers are able to use the engine of the game, like Open Arena. (An open source web based game and relies on users feedback to further improve the game).  Due to low switching costs, existing users could easily switch to another game such as Open Arena, however, due to the network effect and their friends playing this game, users will be more reluctant to switch. 

2. O.A.D.

O.A.D. is an ancient warfare game, which, in July 2009, became an open-source game. It is part of Wildfire Games, which consists of volunteer game developers from all over the world. O.A.D. is a free Internet download game where every user is able to redistribute the game and modify the game. 

O.A.D. has two tracks for organizing the development of the users. The first track is called ‘Jump right in, the OS way’. This track makes it possible for anyone to contribute to the game. The second track is managed the development, called ‘File an application and join the team’. The user can join the official developing team by just filling an application.

Strengths vs. Weakness

+ Encourage sharing, learning and creativity of both developers and users

+ The more the users contribute, the better the solutions

–  Weaknesses is the game is depending on the volunteers



Conceptually, the word freemium is made up from the words free and premium. It describes a business model where a core product or service is provided for free of charge but charge premium for advanced features, functionality or virtual goods. The model is typically used for offering digital goods, such as software, media, games or web services.

There are several ways in which the products or services will be restricted in the free side, such includes:

  • Feature limited (i.e. Skype “lite“ version)
  • Time limited (i.e. Microsoft office trail for only 30 days)
  • Capacity limited (i.e. Harvard Business Review account for limited numbers of articles)
  • Seat limited (i.e. Anti-virus software, for security only usable on 1 computer)
  • Customer class limited (i.e. Some software only available for educational users)
  • Effort limited (i.e. Some virtual printing on pdf, for all or most features are free but require extended unlocking can be a shortcut for an extra fee)

Freemium games

Likewise, freemium games have become increasingly popular in the smart phone marketplace. The games are free to download and play, but in order to take advantage of advanced features or functionality, developers charge gamers for access. Several studies showed the value of in-app purchases is currently accounted for $970 million, representing 39% of all spending. By 2015, this figure would grow to $5.6 billion or 64% of the total market share.

CSR racing

Recent news reported that $12 million monthly revenue was generated by a free-to-play racing game application named CSR racing, and the game was only launched at the end of June 2012. The game CSR racing runs on a relatively simple mechanics that, two cars compete on a parallel drag track; the car which first reaches the destination line is the winner. Power and acceleration is the key of this game. The players need to upgrade the gears of their cars (engine; turbo; gear box; and tires, etc.) in order to beat the rivals.

Strength vs. Weakness

+ Pioneer of animation technology

+ Easy to play

+ In-app purchase, exchange real money into virtual currency

–  Rat race competition

–  Limited software device, only available for iOS system.


On behalf of team 2-2



Open source



A Shadowy world of selling software bugs

How Selling Bugs Began

One of the first security researchers credited with selling an exploitable flaw was Charlie Miller, a former employee of the National Security Agency who now works for the consulting firm Accuvant. In 2005, Miller found a vulnerability in the Linux operating system and sold it to the U.S. government for $80,000.

“The government official said he was not allowed to name a price, but that I should make an offer,” Miller told SecurityFocus. “And when I did, he said OK, and I thought, ‘Oh man, I could have gotten a lot more.'”

Today’s Bug Market

Today, many software makers offer bounties for vulnerabilities. So far this year, Google has spent more than $290,000 for vulnerabilities in its Chrome browser and recently raised the minimum bonus to $1,000.

A number of companies buy bugs and then sell them back to software makers on a subscription basis. Examples include iDefense and Zero Day Initiative, which pay from $500 to $20,000 for vulnerabilities.

But the big money is chased by companies like Endgame Systems, Netragard and Vupen Security. They focus on the more lucrative market of selling bugs to government agencies that use the information to hack computers and phones of crime suspects and intelligence targets. However, their customers also can include large corporations.

In February, Vupen, which publicly promotes it services, let its team of hackers loose on Google Chrome to win a hackathon held by Hewlett-Packard. At the same security conference, Vupen snubbed a similar contest held by Google, which paid each of two winning hackers $60,000. To Vupen the prize was pocket change, since it would have had to hand over details of the flaw to Google.

“We wouldn’t share this with Google for even $1 million,” Vupen chief executive Chaouki Bekrar told Forbes. “We don’t want to give them any knowledge that can help them in fixing this exploit or other similar exploits. We want to keep this for our customers.”

Also in the high end of the market are so-called “bug brokers” who negotiate deals for vulnerability hunters. One such broker goes by the pseudonym “The Grugq.” A noted security expert himself, The Grugq sells to the highest bidder, typically a U.S. or European government agency, and charges a 15% commission, according to an interview in March with Forbes.

As you would expect, bugs in the most popular software – Windows, Microsoft Office, Apple’s iOS, Web browsers, etc. – earn the highest prices. And with so much money at stake, it’s no wonder that plenty of smart, ambitious hackers are spending endless hours tearing apart popular software looking for vulnerabilities – and finding them.

No Laws, Few Rules

The selling of software vulnerabilities is perfectly legal. In fact, consulting firm Frost & Sullivan named Vupen the 2011 Entrepreneurial Company of the Year.

The problem is in who buys the information. People may believe it’s OK when a U.S. government agency is the purchaser, but what about intelligence agencies from other countries, possibly ones hostile to the U.S.? Exploitable bugs can also find their way to cyber-criminals who could use them in large-scaled malware attacks on home or business computers.

The Critics

Among the most vocal critics of vulnerability trading is Christopher Soghoian, a principal technologist and policy analyst for the American Civil Liberties Union. In a presentation at the Virus Bulletin conference in September, Soghoian argued the need for some form of oversight of the industry.

“If the industry wants to avoid regulation, it needs to regulate itself,” Soghoian said.

A Need For Regulation?

Self regulation appears unlikely. But a regulated exploit market is not unprecedented. Germany, for example, has strict laws that not only make it illegal to sell exploits, but also to distribute them for free.

But there’s no consensus here in the U.S. Some experts argue that regulating the industry is like trying to regulate guns. Laws are in place through out the country, yet criminals still have guns.

Others argue there should be restrictions on exports, while the domestic market remains open. The problem with this strategy is it might encourage stockpiling of exploits, which carries its own risks.

There are no easy answers, but it’s time for lawmakers to look at the industry before an exploit sold on the open market is used in an attack that empties bank accountes, steals state secrets or disrupts the power grid.

In the aftermath of such an large-scale infrastructure attack, the rush to regulation is unlikely to produce good policy. That’s why we need to address the issue now.


Technology of the week: virtual worlds

This Monday we (team number 2) will present to you the technology of the week. We will discuss two companies currently active in the Virtual Worlds business: Second Life and Virtalis. Second Life is a MMORPG (Massive Multiplayer Online Roll Playing Game, because we only have 15 minutes to present our subject, we will use the MMORPG on Monday…) which has been online for nearly a decade now. Our second company, Virtalis, is a company that has lots of expertise in the virtual reality business. They can create multiple 3D business applications, one of these applications will be shown in Mondays presentation.

Second Life

Second Life started in 2003 as a part of Linden Lab, a game developer. Quickly, it became famous because it is possible to make money in this virtual world. All kinds of people tried to create value in the game and transfer this online currency to real money. It is estimated that 64000 people currently make a profit on Second Life and 230 people earn more than 5000 US dollar per month (!) using this virtual reality. Given the fact that more than 30 million people subscribed to this game, one could argue that 230 people is a rather small proportion. Linden Lab refuses to give away information regarding the amount of time their subscribers spent online, so actual we cannot draw conclusions whether the 230 is very little or a lot.

The strengths of Second Life are the possibility to create your own world. People can be very creative and have a lot of options within Second Life. Another strength is the earlier mentioned virtual economy, with the opportunity to actually make a profit. Finally, the global reach of Second Life gives people an opportunity to communicate with a lot of different users from all over the world. The weaknesses of Second Life lies in their rather outdated graphics. People refer to Second Life as ‘a chat room with a nice cover’. Another weakness is the creative freedom Second Life guarantees their users, which lead to a significant amount of inappropriate behaviour.

Major opportunities for Second Life is the possibility to be the first MMORPG with actual usage of 3D technology on laptops and computers. After the introduction of 3D technology in movie theatres, it is only a matter of time before this will be implemented in games.

The threat for Second Life is obvious, MMORPG’s as World of Warcraft has a significant larger amount of active users. Another threat is that Second Life needed to raise their monthly fees, which resulted in a decline of new premium members. It is possible to create a freemium account, which we did to really get to know this Virtual World, therefore a higher monthly fee will not motivate people to create a premium account.


Virtalis is a very interesting company for BIM students. It works with the latest technology, creating very impressive products with a lot of business applications. They can turn a corner of an boring office into a huge warehouse with prototypes of all kind of products. This leads to great oppurtunities for newly build large construction vehicles, which can actually be developed onscreen. Another usage of the products of Virtalis is with universities, where teachers can create a 3D learning experience for their students, especially helpful in medical studies.

The strengths of Virtalis are the strong position they hold as industry innovators within the virtual reality sector. A weakness is the investment costs necessary to acquire Virtalis’ products. Oppurtunities are the expansion to consumer markets and the introduction of 3D technology to a broader audience, which could boost their revenues. Threats are the possibility of new entrants with cheaper technologies.

We will introduce a lot more details on the presentation on Monday! We hope you will enjoy our presentation on Monday but for now:
Game Over!

Apple, Foxconn and more…

Nowadays everyone has a smartphone and there is a relative increase in the number of smartphones in the Netherlands. They pop-up everywhere, young or old almost everyone is in possession of some kind of smartphone.

With the introduction of the new Apple iPhone 5, the prices reach a maximum level whereas the majority of the population desires the new model.

A recent publication reveals that the price to build an iPhone 5 is 160 euro for the 16 GB model and 184 euro for the 64 GB model. The average selling price is approximately 620 euro. Even with shipping costs and legal fees, there is still a substantial share of profit for Apple left.

When we have a brief look at the manufacturing process, that is being outsourced to Foxconn in China by Apple,  it is in bad publicity. Last year there were suicidal attempts of employees and recently there has been a work-strike by the employees.

Apple invested in the facilities and improved them after these events but with the introduction and the great succes of the iPhone 5, it also raised the productivity standard in the factories in order to fulfill demand. This led to a recent strike at one of the factories.

On the other hand, as a customer, we are willing to pay tremendous amounts for our precious smartphone. After examined the prices of different providers, the average price for an iPhone 5 16 GB are monthly 60 euro for only 200 minutes and a maximum of 1000 MB for internet usage (2-year deal).

This is truly an monthly obligation. The same minutes and Mb’s can be bought separately for half the price without the Iphone 5 (sim-only). So we purely pay for the iPhone that is assembled for 160 euro. (24x 60 = 1440 euro).

The providers are only increasing theirprices over time with every release of the Iphone because they are aware of something: It does not matter how much the new iPhone will cost, the customers will buy it anyway…

The more clever providers are focusing their advertising to create an belief that they are doing everything in favor of the customer with so-called special offers. The only thing they want is to milk you out…! Besides, the most new improvements are of incremental kind!

So, is the newest smartphone worth the monthly obligation that we happily accept?

Whatever the answer might be, one thing is certain: We embrace the new smartphone…



Information Security: New hashing algorithms needed soon

Hashes are widely used for security. For example, hashes are used to safely store passwords, verify that software has not been altered by someone else, and to verify certificates used by websites. The idea behind hashes, is that it is practically impossible to use different bases which calculate to the same hash on purpose. Although theoretically this is possible as the hashes are far shorter than its original base (in numbers) and the number of unique hash-codes is limited.

Trying to find two (or more) numbers that would result in the same hash is called a collision attack. When these attacks can be done successfully and consistently a hashing algorithm is said to be broken. This has happened in the past to algorithms such for instance MD2 and MD3.

SHA-1 is currently the most widely used hashing algorithm. However, this algorithm is in need of an upgrade very soon. An Intel researcher calculated that by 2018 successful collision attacks can be made on SHA-1 hashes. This means that in 2018 any security based on SHA-1 can be compromised by anyone with sufficient funds. Currently, the SHA-2 alghorithm is already available to upgrade security and  an SHA-3 standard has recently been agreed upon. Regardless of the timing, it is certain that long before 2018 everything that needs to be secure must have been migrated to a more secure algorithm.

What I am wondering however, with the speed at which computational power increases, will our creativity remain able to outpace it? Or will there be a time where algorithms are broken in such a short period of time (after acceptation) that they become useless for security?

Are droids taking our jobs?

Andrew McAfee is addressing a relevant question: Are droids taking our jobs?

My question is: Should we be worried?

Robots and algorithms are getting good at jobs like building cars, writing articles, translating. These were jobs that once required a human. So in this era of technology, what will we humans do for work?

Check out this video Are droids taking our jobs? where Andrew McAfee walks through recent labor data to say: We ain’t seen nothing yet. He steps back to look at the history, and comes up with a thrilling view of what comes next.

Google develops artificial brain – Using big data algorithms to model human-like thinking processes

When computer scientists at Google’s mysterious X lab built a neural network of 16,000 computer processors with one billion connections and let it browse YouTube, it did what many web users might do — it began to look for cats.

The “brain” simulation was exposed to 10 million randomly selected YouTube video thumbnails over the course of three days and, after being presented with a list of 20,000 different items, it began to recognize pictures of cats using a “deep learning” algorithm. This was despite being fed no information on distinguishing features that might help identify one.

Picking up on the most commonly occurring images featured on YouTube, the system achieved 81.7 percent accuracy in detecting human faces, 76.7 percent accuracy when identifying human body parts and 74.8 percent accuracy when identifying cats.

“Contrary to what appears to be a widely-held intuition, our experimental results reveal that it is possible to train a face detector without having to label images as containing a face or not,” the team says in its paper, Building high-level features using large scale unsupervised learning, which it will present at theInternational Conference on Machine Learning in Edinburgh, 26 June-1 July.

 “The network is sensitive to high-level concepts such as cat faces and human bodies. Starting with these learned features, we trained it to obtain 15.8 percent accuracy in recognizing 20,000 object categories, a leap of 70 percent relative improvement over the previous state-of-the-art [networks].”

The findings — which could be useful in the development of speech and image recognition software, including translation services — are remarkably similar to the “grandmother cell” theory that says certain human neurons are programmed to identify objects considered significant. The “grandmother” neuron is a hypothetical neuron that activates every time it experiences a significant sound or sight. The concept would explain how we learn to discriminate between and identify objects and words. It is the process of learning through repetition.

“We never told it during the training, ‘This is a cat,’” Jeff Dean, the Google fellow who led the study, told the New York Times. “It basically invented the concept of a cat.”

“The idea is that instead of having teams of researchers trying to find out how to find edges, you instead throw a ton of data at the algorithm and you let the data speak and have the software automatically learn from the data,” added Andrew Ng, a computer scientist at Stanford University involved in the project. Ng has been developing algorithms for learning audio and visual data for several years at Stanford.

Since coming out to the public in 2011, the secretive Google X lab — thought to be located in the California Bay Area — has released research on the Internet of Things, a space elevator andautonomous driving.

Its latest venture, though not nearing the number of neurons in the human brain ( thought to be over 80 billion), is one of the world’s most advanced brain simulators. In 2009, IBM developed a brain simulator that replicated one billion human brain neurons connected by ten trillion synapses.

However, Google’s latest offering appears to be the first to identify objects without hints and additional information. The network continued to correctly identify these objects even when they were distorted or placed on backgrounds designed to disorientate.

“So far, most [previous] algorithms have only succeeded in learning low-level features such as ‘edge’ or ‘blob’ detectors,” says the paper.

Ng remains skeptical and says he does not believe they are yet to hit on the perfect algorithm.

Nevertheless, Google considers it such an advance that the research has made the giant leap from the X lab to its main labs.

By Liat Clark, Wired UK