(OK, this is getting heavily theoretical here, but I’ve been thinking about this lately.)
An ARG is an interactive narrative experience that involves the audience directly in the action, and whose interface with the audience is not limited by medium.
I think this limited-interface thing is really key to ARGs, and part of what makes them so rich for the audience. You experience creative content of any kind through an interface. You interface with William Gibson’s creative work through a book. You interface with Beat Takeshi’s work through a screen (TV, movie or computer). These are all one-way interfaces, where data flows from the creator to you. Video games, and increasingly the web, have a two-way interface with the audience because the data flow is two-way.
But all these media, interactive or not, are limited to just one delivery device (e.g. video screen, paper pages). But ARGs use any available device. iLoveBees used payphones. Vanishing Point, the ARG promoting Microsoft’s Windows Vista, used skywriting. (Microsoft is all over the genre, actually, as they carried off The Beast, too. That one used one-on-one telephone conversations as part of the interface.) You could imagine an ARG using almost any means of communication.
It seems narrative and story is also key for ARGs, in a way it isn’t for many other games. I’ve posted before about the fact that games aren’t about the story. But ARGs are interesting partly because they motivate audiences to solve puzzles, share information, form communities and work collaboratively. They motivate people by confronting them with a believable story that they can get involved in. It’s empathy taken to the next level: every member of an ARG’s audience begins caring about the story because of the games’ characters and what’s happening to them. But the audience also feels personally involved – is personally involved – in the evolution of the plot. Often, the plot progresses only because of their concerted collective actions. This shared experience motivates people and gives them an excuse to get out and do things they wouldn’t normally do – write a book, start a code-breaking project, go hiking looking for something lost in the woods.