I think the foremost concern of role-playing games is the construction of (rather than the presentation of) of engaging narratives. Role-playing games are a form of social interaction, and we ought not allow an unusual detail of one derivative format (computer role-playing games, often experienced by a lone player interacting with a computer) to obscure this important aspect of the nature of rpgs. Narratives constructed during role-playing gameplay should be mutually satisfying to all participants. To be considered mutually satisfying, the process of rpg narrative construction should actively solicit significant contributions from all participants.
Consider the following example: a fellow goes to a party, and spends the entire evening silently slouching in a shadowy corner. He doesn't have a good time, and this is his own fault because he did not attempt to involve himself in the party (beyond merely showing up). However, responsibility for the fellow not enjoying himself also lies with the host of the party-- a good host who hopes to have a successful party will actively ensure that all his guests are engaged in socializing with other guests, and solicit the engagement of all his guests by providing a wide array of activities designed to promote various forms of congenial socialization so that each guest will find at least one opportunity to do something pleasant while enjoying the company of other guests.
Unlike bottles of bourbon or swimming pools, matters such as narrative and characterization in crpgs are ideas. These ideas are expressed during a process of communication between designer and player, and these ideas tangibly exist only in the mind of each player, as perceived and interpreted by each player. Yet each player's mind already contains many other ideas, such as memories of personal experiences and notions of ethical conduct. The content presented by the crpg designer must be integrated with these other ideas in the mind of the player in order to be nontrivially expressed-- which is to say, to exist as anything more than a bit of plastic collecting dust on a shelf somewhere.
Players typically choose to play role-playing games, rather than playing other sorts of games or taking vacations to exotic locales, because they are seeking to have a particular sort of social or interactive experience offered by role-playing games. In their most general form, role-playing games resemble a conversation. The designer asks a question-- "Here's a certain situation, what would you do in this situation?" and the player responds-- "I would do x, because x-ing is important to me." The designer then continues the conversation-- "Here are the consequences of x. What would you do in this new circumstance?" and the player responds, et cetera. Thus we see that gameplay requires at least two participants, designer and player; without the novel contributions of both participants, there is no game. The "outcome" of a role-playing game session is a narrative which is not entirely the work of the designer, nor entirely the work of the player-- both are co-authors of the particular narrative which emerges during gameplay.
Just as a good party requires a thoughtful host as well as amiable guests, one consequence of this social or collaborative nature of rpgs is that to have a good rpg experience one must not only have a good designer, but a good player as well. One reason role-playing games are a niche hobby with limited mass-market commercial appeal is this requirement that a successful game demands sharp, thoughtful players as well as sharp, thoughtful designers-- not everyone has an imagination, and among those who do many don't have sufficient time to take long excursions into lands of reverie. A poor player, who either from lack of ability or lack of cultivation of ability makes minimal or unimaginative contributions to the collaborative creative endeavor, can quite justifiably say the game he experienced was an inferior game-- but he would be wrong to attribute all responsibility for the inferiority of the product he experienced to the designer, since the player directly shared in the authorship of the final product (which, again, is an experience rather than a tangible product like a car or a meal). Likewise with the designer who feels he has some important thematic message he intends to beat players over the head with, or who has obscure and eccentric notions of what is or is not engaging-- if the designer does not provide adequate opportunities for player assessments and contributions to the endeavor, then the social interaction that is the rpg experience will fail. The player will stop playing if the game in question does not provide the expected quality of interaction or too much resembles mere observation (such as watching a television program).
We might use the metaphor of a playground to examine the differences between role-playing games and other sorts of games. Most sorts of games resemble a playground in which either a physical education class is being conducted-- "All right, children, first you will navigate the monkey bars, then you will climb the slide and slide down, then we'll finish up with a round of jumping jacks," or an athletic event is being contested-- "Okay, we're going to run the hundred yard dash now, on your marks, get set, go!" On the other hand an rpg resembles a playground during a freestyle recess period. The designer provides various forms of engagement (monkey bars, basketballs, etc), builds a fence around the playground, and says "Okay kids, do whatever you want-- just stay inside the fence, we don't want you running out into traffic on the chaotic nearby street." Like a good rpg designer, a good playground designer considers his job to largely consist of providing a plausible maximum number of diversions (given budgetary constraints, local public safety laws, etc) in a particular setting and does not concern himself with how any particular playground patrons will choose to spend their time on any particular visit. If he provides monkey bars on the playground, his job is to see that the monkey bars are sturdily constructed so those who climb them can do so safely, but beyond that he doesn't much care whether any particular patron uses the monkey bars instead of playing basketball (or even if patrons merely sit on a bench to watch the clouds, for that matter). The playground experience, then, consists as much of how particular patrons choose to amuse themselves on a given visit as what options the designer chose to offer as amusements.
In other words, because role-playing games are inherently a social interaction, we can say a role-playing game is good when it provides maximum flexibility for the meaningful input of all participants involved in the interaction (which we call gameplay). Furthermore, to the extent that a role-playing game produces any tangible product at all (beyond ephemeral participation in a social experience), that product is a collaborative narrative that emerges during gameplay. Constructing and exploring this narrative is the primary purpose of rpg gameplay.
These criteria delineate distinctions between adventure games and rpgs (different types of games that often share similar gameplay mechanics) as well as distinctions between rpgs and multiplayer games based on conquest or commerce (another form of game based on social interaction). For example in an adventure game, the player-character pursues certain activities (solving puzzles, gathering objects) in order to comply with a particular narrative provided by the designer ("Save Carnival Island from Mr. Sourpuss!"). In an rpg, the purpose of gameplay is for designer and player to collaborate in the construction of a mutually satisfying narrative that explores the characterization of the player-character, and activities of the player-character are largely pursuant to that goal rather than an attempt to arrange any particular set of circumstances to satisfy an external objective (victory condition) stipulated by the designer alone. In an rpg, the player will likely wish to respond to a gameplay opportunity by saying "My character chooses to do x in this situation, because x-ing is important to him" rather than "My character must do z in this situation, because accumulation of z is vital to winning the game." This distinguishes rpgs from strategy games, as the latter (like adventure games) feature gameplay primarily focused on objective outcomes for the player.
In adventure or strategy games, though a narrative develops regarding the player's avatar in the game world, that narrative is incidental to and of far less importance than the primary purpose of gameplay. Winning a game may be a player's goal, but good rpgs should be about player-character narratives (typically based on attaining player-character goals relevant to player-character concerns) rather than player concerns (such as winning or losing a game) that are extraneous to the gameplay narrative. Well-designed rpgs will often succeed at satisfying both players and player-characters by minimizing potential disjunctions between player desires and player-character desires, though we should also consider that some imaginative players may relish such disjunctions. For example if we have a game where the victory condition is "Marry Princess Mika," as players we may reasonably stipulate that beyond pursuing Mika for her fair charms, the player-character also has broader motivations in wishing to place a jeweled ring on her delicate finger. Some players will thus be quite fond of "losing" outcomes such as "Having dishonored his emperor Ming by failing to repel the invading lobster-men from Pluto, Lord Musashi maintains the honor of his family and allows them to keep the title to their ancestral lands by committing ritual seppuku with his lightsaber. He thus never fulfills his life-long ambition of marrying Princess Mika and uniting their neighboring clans in prosperity forever more." In this case, the designer's contribution to the narrative told us the player-character was concerned with the prosperity of his family, and hoped to foster that prosperity by marrying the Princess. As the setting of the game seems to resemble feudal Japan, we can presume the character is a samurai warrior concerned with his personal and family honor. In the losing ending mentioned, though the player-character did not marry Mika he succeeded in both preserving his own honor and his family's prosperity (at least to some degree, because they did not subsequently become homeless paupers). Players who pursue such styles of play (typically veterans with years of rpg play under their belts) thus take a broader view of things, reminiscent of the scene in the movie "Saving Private Ryan" when the soldiers are debating the wisdom of assaulting an enemy machine gun nest they encounter in the countryside. One grunt says "We should just go around it, it's a distraction from our objective of finding Private Ryan." The captain replies "Our objective is to win the war," and orders the assault to proceed. The job of the rpg designer is to encourage such player contributions (rather than insist that as designer he reserves the right to tell the only meaningful or interesting stories) in a context conducive to sound principles of role-playing (for example, minimizing potential conflicts between player desires and player-character desires as previously mentioned).
Fallout, like most games with which we are likely to concern ourselves in this forum (we're not gathered here to discuss Canasta, after all), is a hybrid of role-playing game and adventure game. The player is given wide latitude to specify numerous initial conditions of the player-character's characterization, and then given considerable freedom to explore that characterization in the setting of the game-world. Yet the designers also specify several important aspects of the player-character's characterization-- the pc is from a place called Vault 13, and Vault 13 has a serious problem with its water chip which the pc is charged with resolving. If the pc does not resolve the problem within a certain timeframe, his friends and family will suffer and perhaps die. There are at least two ways of looking at this form of game construction. On one hand, we might say that because the designer has stipulated a narrow goal (saving Vault 13) and a limited provision of means for accomplishing that goal, Fallout is an adventure game with a fixed narrative stipulated by the designer. On the other hand, we might say that the designer's contribution to the characterization of the Vault Dweller is that the Vault Dweller is a person concerned with saving Vault 13, and the player's contribution to the interaction that is the rpg experience is to construct a narrative (within parameters provided by the designer, like a fence around a playground) that best nurtures and expresses the confluence of the designer's contribution to the characterization of the Vault Dweller and the player's conception of the characterization of the Vault Dweller. Gameplay consists of exploring a narrative that unfolds responsively to the player's contributions to the endeavor, and the experience of enjoying that narrative is the ultimate purpose of Fallout gameplay regardless of whether the Vault Dweller succeeds in saving Vault 13. In fact, for some Vault Dwellers the narrative most truthfully expressing their characters will preclude saving Vault 13. Whether we embrace one overall perspective or the other largely depends on how engaged each of us is by the general notion of role-playing. The strength of Fallout as a game is that it embraces both genres and facilitates both styles of play, rather than strictly limiting potential players to one or the other, even though we may conclude that Fallout is a much better adventure game than role-playing game because, due to practical development constraints twenty years ago as well as the underlying constraints of crpgs as opposed to live rpgs with participants gathered around a table or in an internet chat-room, the rpg conversation is rather one-sided with far more contributed by the designer than the player to the final product (a narrative).
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A common way to think of art is that art inspires people to consider the fundamental nature of their humanity and the human condition. The artist chooses a medium, and then seeks to engage his audience to ponder certain questions. While electronic games are often no more than a trivial diversion expressing trivial notions common to all mass-media entertainment, the interactive nature of electronic games also makes them an inherently engaging medium highly amenable to expressions of the highest aspirations of art. Though electronic games have been around nearly forty years now, sadly many people (including many enthusiastic gamers) continue to believe that such media are kid's stuff, lacking serious artistic merit. This perception is broadly reinforced because, sadly, most electronic games truly are frivolous entertainment lacking serious artistic merit-- yet this is mere coincidence rather than any inherent limitation of the medium itself. Good games, and particularly good role-playing games, can and should strive for the highest ideals of art-- to help us understand our own lives, to understand our place in society and in the universe around us, and to help us decide what all those circumstances mean for how we should live. If a computer role-playing game is social interaction whose only tangible product is a collaborative narrative produced by designer and each player, then we're not correct to say that designer alone is an artist. Designers alone are not the authors of rpgs-- they are only co-authors, sharing credit with each player for the narrative each player experiences. Another way to say this would be: games are an interactive medium, and therefore if a game has artistic merit then any artistic output of that interactive game is a collaboration between all participants who interact-- namely, both players and designers.