Meteor’s Take On Transmedia

BY

Adhesive Games has been building the free-to-play giant robot game Hawken for over two years now, and Meteor Entertainment is the publisher. The game has had strong transmedia connections from the beginning, with a graphic novel recently released, digital shorts in the works with Machinima and a feature film in production. The [a]list daily sat down with Meteor’s vice president of transmedia marketing and promotions Paula Cuneo to discuss the unusual nature of Hawken‘s marketing efforts.

Cuneo is a game industry veteran with a varied background, working at companies like MicroProse, Activision, Microsoft, and Digital Development Management. “My background in gaming is super circuitous, Cuneo said. “I was a producer, I was in licensing, and business development, corporate alliances, in-game advertising. Now as VP of transmedia marketing and promotions, Cuneo is overseeing a diverse band. “The group that I sit on top of now and work with is community, social , PR and events, brand marketing and brand planning, customer service and support. It really is soup to nuts. From awareness, from the very beginning when we’re iterating against a new IP, to customer support tickets to make sure the experience keeps people happy and in the space.

Transmedia marketing means reaching across categories to find customers. “Our CEO Mark Long was really specific from the get-go about how he wanted to make sure we’re reaching beyond the gaming industry and hitting a variety of really passionate industry points “ feature films, graphic novels, the whole thing, said Cuneo. “The challenge is that stuff takes a long time. We are like a year and a half in, and finally we have transmedia that’s coming to fruition so we actually can use it to market our game.

“That’s essentially what we consider to be transmedia “ make sure all our media points are helping to market the game, Cuneo continued. “My job has been amended significantly to be much more focused on games as a service. Free-to-play is about a super long tail. You want to make sure minimum viable product goes out in the best way possible, but then you make sure people are in it for the long haul.

The marketing Cuneo is overseeing has little to do with traditional channels. “If a game is really good, it should be all word of mouth, in a perfect world. We’re not spending any money against advertising and we’re not doing any paid media, Cuneo explained. “We’re really making sure that the product itself and the experience you get interacting with the company means you want to stay around.

Cuneo sees the community itself as a great marketing resource. “We’ve created a bunch of advocate groups. We have what we call Hawken’s Heroes, people who have played the longest who are great advocates. They have their own forums and we can poll them about all sorts of things, Cuneo said. “Those are the guys who aren’t just making the game better, but making games as a service better. We want to make sure people stick around even when we make a mistake, because we want to fix that mistake.

Meteor views eSports as a significant target for Hawken. “It would be hard not to, said Cuneo. “That raises the bar considerably in terms of game balance. Absolutely. It’s such a blessing to have Riot come before us; it’s good to have people who are doing it well. They have a wonderful, competitive game to play and they created this balance. It has to be a space where you can keep the playing field level. That will happen when we get that influx of people at go-live.

Finding potential Hawken players for Meteor means going to consumer shows. “We’ve been very event-focused, making sure that we were on the ground so there was a hands-on opportunity, Cuneo said. “We’ve executed a lot of stuff that was very fan-focused. Both the PAXes, East and Prime, were hugely important to us, Gamescom too. Transmedia is great, because it gives us a reason to be there while we’re evolving as a game. We work with a publisher, Archaia, who does our graphic novel, a beautiful hardcover book of Hawken which starts to integrate the lore and backstory of the game. We’ve been allowed to piggyback on the different cons they do. We find that those fans, comic fans, are super-sticky. They’ve read it, they get it, they play, they monetize, they stick around. Those super-passionate fan points are great.

Marketing has to be more creative with a property like Hawken, Cuneo believes. “The idea that you need to react against player behavior is really important. You can’t pretend to care. You cannot phone it in, Cuneo said. “We have hugely passionate players we’ve asked to stick with us through thick and thin. When they say something, you respond to them. It’s a gold mine, but you have to be a sincere and an honest, active listener, and then you have to translate what that means and give it back to development, then development has to appreciate it enough to integrate it. That’s games as a service. The idea that teams used to roll off of games, we’d all have a glass of champagne and move on to a totally different genre . . . no. Everyone’s in it for the long term.

Cuneo doesn’t expect to find Hawken players through traditional marketing channels. “The people we want to get playing our game are playing games now, they’re not watching TV. To pretend that we could advertise where we are not doesn’t make any sense, Cuneo said. “We’re trying to facilitate advocacy inside the community. Publishers clearly are changing the way they do business and they way they are spending. There’s tons of fantastic middleware that allows for real-time results against media buys, you can do microtests to see what people are hitting. That whole ‘We’ll have an agency, and they’ll parse out where our money goes, and they’ll spend it, and we’ll measure it to see if it worked out not and that’s the end’ “ it’s not like that any more.

With Titanfall arriving next year, there will be some well-financed mech game competition for Hawken. Cuneo is ready for them. “Every time they advertise, they’re advertising a mech game. We’re a mech game too, and we’re free! We’re scrappy.

 

EA Surprise: Q1 Revenues 76% Digital

BY

Electronic Arts delivered financial results above their guidance for the fiscal first quarter ended June 30, and that wasn’t the only surprise from the earnings call. “In Q1, 76 percent of our non-GAAP revenue was digital,” said interim CEO Larry Probst, “driven by the online services of blockbuster franchises like Battlefield and FIFA, as well as our strong mobile portfolio.” The company reported $495 million in non-GAAP revenue, well beyond the $450 million EA predicted last quarter. The stock has risen over 10 percent today in early trading on the news.

“76 percent digital sales is absolutely no surprise to me,” said Peter Warman of market research firm Newzoo. “EA is one of the largest and most diversified game publishers and therefore you can expect to see the divide of their revenues more or less in line with the total market divide. This year, new boxed sales will represent a maximum of 35 percent of US game spending.”

“What is surprising is the discrepancy between digital revenue expectations on Wall Street and actual earnings: EA’s digital revenue was $378 million for the quarter, well above the $313 million expected earnings,” said Joost van Dreunen of digital goods measurement firm Superdata. “It indicates that the digital category is growing faster and has more potential than people anticipated.”

The digital surprise came from several sources. EA noted that The Simpsons: Tapped Out recorded its highest revenue quarter since it launched in 2012, and overall mobile revenue increased 30 percent for the quarter. EA’s Origin service now has 50 million members, 22 million of them on mobile, and digital sales of Battlefield 3 were strong despite the fact that Battlefield 4 is coming soon.

“It is also not surprising that EA mentions The Simpsons Tapped Out in its earnings call,” said Warman. “I can imagine the performance of this free-to-play game has sparked a turning point within the EA organization. Seeing a new free-to-play IP earning more money than paid games based on their key franchises must have been one of their biggest eye-opening experiences, taking away all doubt about the direction the market is heading.”

Meanwhile, EA is gearing up for the huge battles expected for the rest of the year. “Microsoft reports that Xbox One presales are trending ahead of the 360 during the same time period, and major U.S. retailers have sold out of their pre-sell allotments,” said president and COO Peter Moore. “And PlayStation believes this will be their biggest hardware launch ever. So we believe that the key indicators are pointing to a strong launch for both consoles in the holiday window.”

EA is expecting this transition to impact sales of sports titles, and so has developed a marketing strategy to ease that process. EA’s two biggest sports sellers, FIFA and Madden, will both be available at launch on the next-gen consoles. “Today, we announced that FIFA 14 will allow players to transfer their full roster of Ultimate Team players and in-game items from Xbox 360 to Xbox One and from PS3 to PS4. Our Madden franchise will provide a similar service,” said Moore.

The question of EA’s new CEO was briefly touched on during the earnings call. “I am assisting the Board of Directors in searching for a new CEO,” said Probst. “While we have nothing specific to share today, the Board is fully engaged in this process and evaluating both internal and external candidates.” EA’s CEO search is certainly more interesting than this bland statement would imply.

The fact that EA still doesn’t have a new CEO implies that the board of directors is looking seriously at external candidates. An internal candidate requires less vetting, and if that was the Board’s first choice EA would already have a new CEO. EA’s board may be looking for a charismatic leader who can revive morale among employees and investors. EA has a growth story ahead, looking at its success in digital and overseas expansions, but those transitions are still going to be difficult. Strong execution is needed to avoid more problems like the cancellation of NBA Live for two years or the poor performance of Medal of Honor: Warfighter.

“Of all traditional publishers, EA is the most active in trying new business models, screens and games in this period of change,” noted Warman. “It has been a rocky road if you look at Star Wars: The Old Republic and the recent launch of Sim City Online. But they are learning quickly by trying whilst other publishers like Activision just wait, not gather hands-on experience and count on their blockbusters to rake in the money. EA’s dare for trying new things is starting to pay-off and will continue to do so towards the future as their key franchises will start to benefit from these experiences.”

EA’s future looks brighter despite the difficult console transition ahead. The increasing momentum EA has on digital will surely help the company through disruptions in the packaged goods markets. “EA has been building a strong digital line-up, and it’s starting to bear fruit,” said van Dreunen. “Over the past year, the company’s transition from physical to digital is all over its balance sheet: digital sales have offset a relatively low number of packaged sales, allowing earnings to remain flat.”

The best opportunities ahead seem to be in mobile and abroad. “Having Apple as its largest retail partner last quarter indicates EA’s ability in capturing the shift to mobile,” van Dreunen noted. “But more important than the current success of titles like The Simpsons: Tapped Out and Real Racing 3, it shows the sustainability of mobile as a platform for the industry at large. For the next period, a key milestone in EA’s digital strategy will be the successful rollout of a free-to-play FIFA Online 13 in China together with its new partner TenCent.”

Activision On The Hook For $3 Billion Dividend

BY

Activision may be forced by majority shareholder Vivendi to pay billions of dollars in a special dividend, according to a report in the Wall Street Journal. Vivendi was the original owner of Blizzard, and owns 61 percent of Activision after the deal in which Activision acquired Blizzard. One of the terms of that deal was a clause that said Viviendi could not cause Activision to have debt of more than $400 million without approval of Activision’s independent directors. That clause expired at the beginning of July.

Vivendi is considering a vote that would pull roughly $3 billion from Activision’s cash reserves, which would net Vivendi about $2 billion due to its 61 percent share of Activision. Activision’s cash on hand (reported during the last earnings call) is $4.6 billion, of which $2.7 billion is held overseas. A payout would potentially require Activision to pay taxes on some of that cash, and the overall effect would be to substantially reduce the assets Activision might use for acquisition or major development projects.

Vivendi has a reported $17.3 billion in debt, which it hopes to substantially pay down by drawing cash from Activision and selling its stake in North African phone operator Maroc Telecom for approximately $5.5 billion. Activision was rumored to be considering buying itself back from Vivendi last year, and that still may be on the table. Such a deal would also mean a substantial reduction in Activision’s cash and a large amount of borrowing.

Meanwhile, Activision has yet to schedule its earnings call for the quarter ending June 30, which normally would take place by the beginning of August. It may be that Activision is waiting to schedule that until the financial picture ahead becomes clearer.

Source: Wall Street Journal

 

The Gamification Of Shopping

BY

Crowdstar has done very well with its line of mobile and social apps for young girls, including titles like Top Girl, Mermaid World and It Girl. Crowdstar’s games have been installed more than 250 million times, and the company estimates that girls spend over 25 million minutes daily with its titles. Now Crowdstar is going after an older female audience with its new title Covet Fashion. The [a]list daily spoke with Crowdstar CEO Jeff Tseng about the game and its unique relationship with fashion brands.

Crowdstar felt that a fashion game for women was a logical extension of the product line. “We strongly believe the female audience hasn’t had that much focus and core games, besides casual games,” said Tseng. “Consoles are very much focused on a male audience. Women have tablets and smartphones, and they’re ubiquitous. The opportunity was there to create this genre of products for the audience.”

The key feature of Covet Fashion is its integration with fashion brands. The app is all about trying out new fashions and discovering what you like and what you don’t like. “The brands all know their audience is moving to mobile, but they don’t have a great way to reach that audience,” Tseng noted. So Crowdstar came up with the idea, and reached out to fashion brands to see what they thought. “We were confident in the value and fun we provide. We did a significant amount of outreach to validate the idea, and almost unanimously people loved it,” Tseng recalled.

The cooperation from fashion brands was outstanding. “There are over 60 brands we’re working with right now, with over 1000 items and we’re working towards more,” said Tseng. Brands signed up include names like Rebecca Minkoff, Cynthia Rowley, Hudson Jeans, Yigal Azrouël, Joie, Nanette Lepore, Erin Fetherston, Dannijo, Fallon, Halston Heritage, Sigerson Morrison, and Mara Hoffman.

Digitally rendered illustrations of each brand’s in-season collections are presented on Covet Fashion for users to buy with virtual currency. “You can learn about fashion, interact with fashion and use it as a stepping stone to purchase fashion,” said Tseng. “We’re bridging different worlds here. You’re styling, you’re sharing and you’re shopping.”

One of the important benefits for a brand that’s used in the game is the data Crowdstar collects. “The data we get is very extensive, and of course we aggregate it to remove personal information,” said Tseng. “We see what items are paired together, the most popular colors, it’s a huge amount of information. We collect a billion data points a day.” This sort of data is invaluable to brands, which usually have limited insight into how their products are combined with products from other companies.

Crowdstar has also enlisted the help of fashion maven Rachel Zoe to boost the visibility of the app.”We met her through one of our investors, it’s been a great relationship,” said Tseng. “She’s had a lot of people asking her to participate, but when she saw our product she got really excited.” Zoe has given Crowdstar feedback on the app as well as helping to promote the title.

Zoe loves the realistic results of the app. “One of the things that impressed me was the aesthetic of the game and how real the products look. It’s a very intelligent game “” it doesn’t dumb down fashion,” explained Zoe in an interview with Women’s Wear Daily. Zoe is also marketing her own Rachel Zoe Collection label on the app.

Tseng sees a bright future for this concept of blending games and shopping. “I think there’s potential for other themes,” Tseng said. “We’re trying to rethink fashion for the medium of mobile and tablet, though tablet is really our main focus. I think that model is very interesting because that tie-in to e-commerce is there. We’re creating a really fun way for you to see what’s out there to buy. We’re taking shopping and making it a fun experience — some see it as the gamification of shopping. There’s huge potential.”

Design For Marketing: A Manifesto

BY

The game industry has undergone massive changes since its inception with rapid technological changes and new platforms transforming games from the motion of a handful of pixels into realistic 3D open-world simulations. Until the last few years, though, the same basic business model has driven game design, development and marketing for decades: Create a game, put it in a package and sell it at a retail store.

That traditional business model made things easier for both marketing and development. Marketing was a straightforward process of getting a package created, arranging for some advance press, then creating an ad campaign that would hit the major magazines. When the game launched, marketing was already moving onto the next product in the pipeline. Oh, there might be a classic edition of the game somewhere down the line, but for the most part both marketing and development were done with that product and on to the next one.

Now it’s different. Digital distribution is taking over on all platforms, and that has multiple implications for both design and marketing. Games need no longer be constrained between a minimum and maximum length of game play set by the parameters of cost of goods and retail pricing. When your only way of obtaining a game was to pay $40 to $60 for it, and that was all you ever got, you expected at least a few dozen hours of game play for that price. Today games can be any length (from a few minutes to hundreds of hours), and size (from a few megabytes to the multi-gigabyte behemoth of World of Warcraft with all expansions) and price (from free to thousands of dollars with spending on virtual goods).

Even for games still sold primarily at retail as packaged goods, the game is no longer confined to the package. Publishers expect games to be 24/7/365 experiences, with regular doses of downloadable content (DLC), active communities and huge numbers of multiplayer online gamers. The retail release of a major game is merely one important event in the totality of that game’s presence across platforms and over time. Games are now a process, a service, not a single boxed product. You have to build and maintain a community if you want to maximize your investment in creating a game.

While technological changes continue (with the growth of mobile platforms, average bandwidth, new consoles and increasing graphics power), the business model changes have been more revolutionary. Now free-to-play (F2P) is the dominant model for mobile platforms and MMO’s, and it’s starting to appear on consoles as well. Subscriptions and ad-supported games generate substantial revenue each year, and the sale of virtual goods is rivaling the sale of packaged goods in retail stores.

Digital distribution has lowered barriers to game distribution, resulting in a huge wave of new games. Thousands of new games are introduced every week on all platforms, and discoverability has become the key problem facing game developers. Players need to find your game, download it, play it, and then get engaged with it enough to want to spend money on it. Getting enough players to do all those things with your game is a huge problem to overcome.

What does all this mean The time has come for marketing and game design to evolve into a new, blended discipline. I call it Design For Marketing, modeled after the engineering principle of Design For Manufacturing — the practice of designing products to be easy to make, which can save substantial time and money for companies that embrace the principle.

Design For Marketing is the principle of designing a game such that it makes a game easier to market. More than that, in the case of games it’s essential to integrate the knowledge of the audience and player behavior into the design of the game. This will create better monetization and an ongoing fan base, maximizing the game’s fun, lifespan and earning potential.

Look at the most successful free-to-play games on the market, like World of Tanks, League of Legends, Clash of Clans. What do they have in common about how they monetize the game Not much — League of Legends has you buying new skins for characters and new champions; World of Tanks lets you earn more experience through a premium subscription; Clash of Clans lets you buy speedups as well as upgrades to troops and buildings.

The lesson is this: There’s no One True Way to monetize a free-to-play game. Monetization has to be organically integrated into the design in such a way that players are happy to pay for desired things. How do you create that sort of a game design By having marketing (or, at least, marketing thinking) integrated with the design process from the start. If you wait until the game is nearly done to figure out something to sell, it’s not likely to work, or to work well.

Marketing and design should work closely to help games find an audience. Games need to have as many ‘hooks’ as possible to attract the attention of gamers. Many things can be hooks: A well-known designer with a large following (like Warren Spector or Sid Meier) is a hook. A familiar brand (like Call of Duty, Madden Football, Super Mario or Halo) is a hook. Hooks can also be a popular license, an innovative game design, a celebrity tie-in, an unusual game subject, the personal struggle of the creator — anything that can attract attention. The more hooks you have, the better.

Once you’ve gotten a player’s attention, you have to engage them. That means excellent game design and execution, of course. But it also means building a community both before and after the sale, and maintaining that community. A constant flow of communication and oversight is needed to be successful with community building.

Game designers need to understand and think like marketers to optimize the design, and marketers need to understand the essence of a game design and how it helps achieve marketing objectives. Designers and marketers should work together from the beginning of a game project to create the very best game possible. The best game is one that’s incredibly fun and incredibly profitable at the same time. Design For Marketing is essential to make that happen.

 

CBS Interactive ‘Playing Aggressively’ In eSports

BY

CBS Interactive, the corporate force behind GameSpot, has announced the hiring of Kim Rom as vice-president of eSports. The move signals the increasing importance of eSports to CBS Interactive as well as the growing impact of video. GameSpot has been using more video on its site, leveraging the native expertise with video that CBS Interactive derives from its connection with CBS. GameSpot is the creator and host of the weekly reality web series, GameCrib which follows the drama of pro-gaming eSports team TSM Snapdragon, who live together in a house in the San Francisco Bay Area.

CBSi VP of eSports Kim Rom

Danish native Kim Rom was previously chief marketing officer for SteelSeries, the Danish manufacturer of gaming peripherals and accessories. Rom’s immersion in eSports also includes several team management positions including the world-champion Counter-Strike teams and the Electronic Sports League in Denmark. He also organized the WorldCyberGames, Electronic Sports World Cup, Cyberathlete Professional League, Danish Esports League and Electronic Sports League events in Denmark.

The [a]list daily talked with CBS Interactive senior vice president and general manager of the games division David Rice and vice president of eSports Kim Rom about the move and what it means.

“eSports is the fastest growing media area in games,” said Rice. “It’s not just an opportunity, it’s a must presence for my division to be playing aggressively in eSports.” Rice sees eSports as a major growth area for CBS Interactive. “You can see some of the things we’ve done over the last six to twelve months, from hosting events with EA Sports to launching GameCrib.” GameSpot has been part of the tremendous growth in eSports popularity over the last few years, and looks to expand thatparticipation with Rom’s hire.

“I want to build on the strengths CBS Interactive already has, which are discoverability and accessibility,” said Rom. He feels that eSports has been very slowly growing for many years, but now it’s really begun to talk off with the popularity of streaming. Working with the enormous audience that GameSpot already draws will make it even easier to bring in new eSports fans, Rom believes, and it’s not just in North America.

“The global reach of eSports is due to the very nature of what it is,” Rom said. “The digital culture and gaming are global.” Rice explained more about the nature of the global eSport audience. “The competitions can be global,” said Rice. “It’s not like FIFA in Europe or the NFL in the US, where you physically have to be present to watch them.” Because most of the audience is online, it lends itself to a global. You can watch your favorite athlete whether he’s in Chile or Taiwan, Rice noted.

Shows like GameCrib are a natural part of eSports, Rice feels. “It’s mirroring the evolution of sports in general,” Rice said. “Sports at the very beginning you had to watch in a stadium, then came broadcast television. You started creating stories because video is the richest medium out there. Look at ESPN, the majority of the programming there is around the sport rather than the sport itself. There are great stories behind all of these teams.” GameCrib has drawn a large audience, and the second season is under way. “It’s expanding this amazing passion that people have, not for game play but for game competition,” Rice said.

Expanding the eSports audience requires that people understand what’s going on in the game, especially when the game is complex like League of Legends. “Absolutely,” said Rom. “We will be focusing on making it accessible and easy to digest, making it entertaining. The games are becoming much more accessible. I think you’re going to see games like League of Legends become easier to understand.” Developers have an incentive to make it easier to understand what’s happening in the game for people watching. That’s already been happening with games like Call of Duty, according to Rice, and we’ll likely see more it given the growing importance of eSports.

The impact of next-gen consoles is more as a new media outlet for streaming video than as a source for competitions. Rice points out that eSports are mostly PC-based, not console-based. But next-gen consoles are pushing media, and Rice sees them as a great place for gamers to watch eSports and programming like GameCrib. “Kim understands the eSports audience and can take advantage of the CBS strengths around premium programming and bring that to the new consoles when they get launched,” Rice said. “You’ll be seeing us working very closely with Sony and Microsoft in terms of getting programming for those new platforms.”

The explosive growth of eSports over the last few years is not over, according to Rice. “I think we’re going to see continued growth,” said Rice. “New consoles are going to offer a whole bunch of new distribution possibilities. A year or two ago it didn’t make economic sense for folks like me to create the human interest stories. Now that you’ve got an audience in the millions and millions, and the views in the hundreds of millions of streams, it makes it viable to be creating all this premium programming like GameCrib. In my mind we’re creating an entertainment genre that will be on the same scale as movies or sports. You’ll see the time spent on game play and game-related programming rival the time spent on watching sports.”

Where are the advertisers Will they be looking at reaching these massive audiences “The 18-34 year old male is the most difficult audience to target for advertisers,” said Rice. “The number one way to target them is gamers. In a lot of our shows what you’ll see from a monetization perspective is brand integration. The brands don’t just want to be at the front of the pre-roll, they want to be integrated into the content itself.”

GameSpot will continue to push forward into video programming with eSports, premium programming and more content on the site. The growth of video game content looks to continue at the same rapid pace for some time to come, and in the process it is transforming consumer and business sites alike.

ESA Study Shows Changing Game Industry

BY

The Entertainment Software Association has released its 2013 survey of the US game playing market, which offers some very interesting facts and figures. First, let’s look at some context: The US retail market for games is in its fifth straight year of decline from its high point in 2008. Hardware and software sales in retail stores have been falling, and not all of it can be attributed to nearing the end of a generation among consoles. At the same time, the gaming industry has undergone an incredible expansion with mobile, social and online games globally. “It was the best of times, it wast the worst of times,” as Dickens put it.

One thing is crystal clear: Gaming has become something the majority of Americans do. The ESA notes that 58 percent of Americans play video games, with an average of two gamers in every game-playing household. Some 51 percent of American households have a dedicated game console, and most every household has either a PC, a smartphone or a game console. The average age of a game player is now 30 — gaming is not just for kids anymore. How gamers play is mostly with others — 62 percent of gamers play with others, either online or in person, and 77 percent of those who do play at least one hour a week with someone else.

The demographics of gaming are changing in another way — women are increasingly a part of the audience. In fact, the ESA found that women 18 or older are a larger part of the gaming audience than boys 17 or younger (31 percent versus 19 percent). The overall gaming market still skews slightly male (55 percent to 45 percent), but that is a far cry from where the gaming industry was twenty years ago when it created games for ‘teenage boys of all ages.’

The ESA found online games are dominated by puzzle games (34 percent) and action/sports/strategy/RPG (26 percent as a group) while what they labeled ‘casual and social’ games are only 19 percent of the online gaming audience. The remainder are in ‘persistent multi-player universes’ and ‘other’ categories. On mobile platforms, casual/social and puzzle/board games each take about 35 per cent of the audience, leaving the rest to action/strategy and other.

The ESA found that 85 percent of people are aware of the ESRB rating system, and 88 percent of parents felt it was helpful. Some 93 percent of parents said they pay attention to the content of the games their kids play, and 89 percent of the time they are present when games are purchased or rented. It’s hard to see how this explains the sales of Grand Theft Auto — are parents really aware of the content of that series

Predictably, console games in 2012 were dominated by action (22.3 percent) and FPS (21.2 percent) titles, with sports games in third place (15.3 percent). The rest of the genre breakdown had no category taking more than 10 percent of the audience. Computer games were fairly evenly split among roleplaying (28 percent), casual (26.7 percent) and strategy games (24.9 percent), with the remainder scattered amongst various genres. For both console and computer games, these numbers reflect only the number of units of titles sold at retail — which means missing a substantial amount of the action on computers, both in terms of units sold and in amount of time played. Something like League of Legends isn’t even considered in this data.

The ESA tried to put a brave face on the data regarding sales and units sold by combining retail sales data with digital revenue data from NPD. Still, the drop in unit sales and dollar volume at retail can be clearly seen since 2008. The rise in dollars from digital revenue should be looked at with the understanding that it’s not clear how NPD arrived at those numbers (and whether it’s accurate or complete), and that not all of that digital revenue went to the same publishers that were losing retail sales revenue.

Finally, it can be seen that the total share of the market for physical sales continues to diminish, and even if you only consider PC, online and console games while ignoring the mobile market, digital revenue will be overtaking physical revenue sometime in the near future, probably this year. That does not mean physical retail sales are going away, nor does it mean an individual publisher will be doing better or worse. This shift of revenue to digital is, however, an inexorable change sweeping over the game industry, and every publisher and developer needs to determine a business strategy for it.

Source: ESA

How World Of Tanks Is Revolutionizing Xbox

BY

One of the more interesting and unexpected occurrences at E3 this year was the surprise appearance of Wargaming CEO Victor Kislyi at Microsoft’s press event. Kislyi announced the imminent arrival of Wargming’s smash free-to-play hit World of Tanks on the Xbox 360, as a free download through Xbox Live. It’s the first time World of Tanks has appeared on a console, and the first major free-to-play game to appear on Xbox Live.

World of Tanks has become a stunning success, with over 60 million players registered worldwide. Wargaming has grown, too, and now has 1,600 employees, with 15 offices around the world (recently opening a Tokyo office). The company’s World of Warplanes has just entered open beta, and World of Warships is on the way as well. The Xbox 360, and potentially other consoles, represents new territory for Wargaming to conquer. The [a]list daily caught up with Victor Kislyi to ask him about this surprising announcement.

Why bring World of Tanks to the Xbox 360 It’s basically the same answer bank robber Willie Sutton gave in the 1930’s, when asked by a reporter why he robbed banks. “Because that’s where the money is,” he replied, albeit apocryphally. Kislyi provides the modern game industry version: “In North America and the UK, that’s the way people play games,” Kislyi said. “Microsoft and Sony combined have an installed user base of more than 100 million, and those are gamers. They’re not checking email on Xbox or PlayStation. It’s a culture. You have to come to them.”

So Kislyi is coming to them, adapting World of Tanks to play on the Xbox 360. The result is an impressive AAA game that plays well on the Xbox 360 and has all the appeal of the PC versions. “The core game has all the depth and complexity that the PC version has,” noted executive producer and creative director TJ Wagner. “It’s running on the same server versions. The changes we made were all about playing it from ten feet away – simplifying the UI, navigating it from the controllers, combining the tank upgrades into packages.”

The biggest hurdle that Wargaming had to overcome was not a technical one at all. Wargaming had to convince Microsoft to change its business policies and procedures. “This is a risky thing for us and for Microsoft,” said Kislyi. “If you look at this objectively this is probably the first big project to come into Xbox free-to-play. Because Microsoft is a huge corporation . . . they have rules, they still sell boxes, there are dozens of aspects we are working with them to overcome. They have to change; they understand this.”

Microsoft traditionally can take weeks or months to approve changes or patches to be rolled out through Xbox Live, yet Wargaming is used to releasing patches and new data for World of Tanks every week. How can those two very different processes be reconciled “That is one of the risk factors,” Kislyi acknowledged. “We’ve been working with Microsoft already for lots of time. It’s about the teamwork. Their rules and policies are changing, and they now understand if they don’t change they will probably lag behind. It’s not easy, it’s not fast.”

Free-to win is the concept that Kislyi is using, rather than free-to-play. “We allow you to earn those things you could previously only buy for gold. It will take you a little longer,” Kislyi said. “Our point with the unified premium account is that the fewer restrictions for people to enjoy your product, the better. That’s the whole beauty and magic of free-to-play, or what we now call free-to-win. It sounds funny that Wargaming comes up with a new word. But it takes courage and guts to do that. Big companies would be ‘free-to-play, how do we allow anything for free ‘ Golden bullets, you used to have to pay money to get, now you can grind for it. It’s risky. But it’s working. There is no way back. If you announce golden bullets for in-game money, you can not go back. Well, you can, but it would be very painful.”

Characteristically, Wargaming’s marketing plan for World of Tanks on the Xbox 360 is simple and straightforward. “With Microsoft we have a marketing plan,” Kislyi said. “We do interviews, we do press, the press is very excited about this. Dozens if not hundreds of different interviews and hands-ons. We’re going to repeat our successful tactics on the PC with eSports, championships, prize money, special events like Liberty Day or Victory Day. There’s going to be a lot of excitement around this game.”

Wargaming may eventually bring World of Tanks to the Xbox One, but Kislyi isn’t concentrating on that. “Well, first they have to come out,” he laughed. “We’re very open with Microsoft about this. We see no reason why not, but they have to get the user base. For free-to-play you need critical mass.” Once the Xbox One has a user base in the millions, then Kislyi will be more interested in the possibilities for World of Tanks. By that time, too, Wargaming should have plenty of information about how well World of Tanks does on the Xbox 360.

If Kislyi has any expectations as to how World of Tanks is going to do on the Xbox, he’s keeping them to himself. “As I mentioned, this is risky both for us and for Microsoft,” Kislyi said. “The best way to find out is to launch, to work hard, to throw our best people on it, to convince Microsoft to throw their best people on it, and see how it goes. The user base is 48 million for Xbox Live; it’s a good number. All connected, playing actively. So let’s see how they love Tanks, how they feel about our free-to-win model.”

The free-to-play model may be a necessary game type for next-gen consoles to really be competitive with all of the options on PCs and mobile. That doesn’t mean every game should be or will be free-to-play, but the availability of high-quality free-to-play options will provide consoles with another reason for people to play on them. Whether free-to-play starts to drive out other business models (as it has done with MMORPGs on PCs) or it settles down to become another type of payment option alongside of premium paid games is not clear.

However it turns out in the end, World of Tanks is already changing the way Microsoft does business. It’s not just the camel’s nose in the tent. The camel has moved in, grabbed a beer from the fridge, settled on the couch and started to play on your Xbox 360. “At the end of the day we’re talking about the service,” Kislyi said. “It’s a game, but around it there are hundreds of people making you happier every day, every month, every year.” It will be fascinating to see what sort of reception awaits World of Tanks on the Xbox 360, and how much of the procedural changes it brings affect Microsoft’s policies for all games.

Top Players In Mobile For June 2013

BY

Editor’s note: Newzoo and Distimo have released monthly mobile game data for June 2013, listing top worldwide games and publishers for iOS App Store and Google Play. Newzoo’s Peter Warman contributes his analysis.

Google revenues from Android game apps continues to slowly close in on what Apple is making. Looking at global game revenues for June 2013 in their respective app stores, Google Play now stands at 41 percent of revenues compared to the iOS App Store. A year ago, Google revenues were only about 19 percent of what Apple was making. On downloads Google Play leads iOS in most countries except the US and Japan. In Western Europe, growth of Google Play in terms of both revenues and downloads has accelerated significantly over the past few months.

Again, the top five publishers in terms of revenues for June has seen a dramatic change. Supercell is back at number one. Its return is largely due to the game maker’s launch of a fully localized version of Clash of Clans in Japan, which released June 17. It immediately boosted its revenues, which we observed to be t by a factor of five.

Mojang is the only new entry in the list, still powered on by Minecraft Pocket Edition and entering the chart at number 16.  Mojang is one of only two publishers on this month’s chart, with LOCOJOY as the other. Zynga dropped four places from May to settle at number 12, though it still has six games remaining in the top 200 games.

Source: Newzoo and Distimo. Rankings based on gross sales.

Candy Crush Saga from King.com is the new best performing iOS game. Supercell’s Clash of Clans climbed from the third to the second position, while GungHo Online Entertainment’s Puzzle & Dragons dropped from first in May to third place for June. Supercell claims a second spot in the top five games with Hay Day maintaining fourth place from May.

In the chart’s biggest jump, Minecraft Pocket Edition jumped eight places to place fifth. Modern War is also performing well, climbing four places to sixth. The next biggest climber is Big Fish Casino, which moved up three positions to eighth place. EA’s The Simpsons: Tapped Out continues to place multiple SKUs on the chart, although both dipped. The game’s Canadian version dropping from seven to 11, and the US version dropping from 14 to place last among June’s top 20. There is only one new entry in this month’s chart, Fast & Furious 6, entered the chart at number 15.

Source: Newzoo and Distimo. Rankings based on gross sales.

Like the iOS App Store, Google’s Android Playstore saw a lot of changes in the top five publishers. Korea-based CJ E&M was the top grossing publisher in June, jumping from fourth place in May. The company replaced Line Corporation at the top, which dropped to second position. Mobage is the only non-Asian company on the list, placing third. It’s followed by GungHo Online Entertainment and COLOPL Inc., both Japan-based game makers.

There are three new entries in the list, Ateam Inc., Electronic Arts and Social Quantum, with Social Quantum as the highest new entry at number 16.

Worth noting is that there is only one company in this month’s top 20 publishers list that has only one product in the top 200 grossing games. It’s WeMade Entertainment, and its lone game is on the top Google apps chart at number six (see chart below). In comparison, the number one Google Play publisher on the chart, CJ E&M, has five games in the top 200.

Source: Newzoo and Distimo. Rankings based on gross sales.

Similar to last month, the top five best performing mobile games in terms of revenue in the Google Playstore has dramatically changed. Puzzle & Dragons is still the best performer, while Candy Crush Saga jumped from fourth to the second place. Line Wind Runner saw the month’s biggest drop, falling from second to eighth place.

Conversely, the chart’s biggest jumpers are Social Quantum’s game Megapolis, which jumped from 19 to place eighth, and Kabam’s The Hobbit: Kingdoms of Middle Earth, which moved up from last place in the top 20 in May to enter the top 10 this month. There are four new entries on the list, with MARVEL War of Heroes debuting highest at number 12.

Source: Newzoo and Distimo. Rankings based on gross sales.

For full reports, visit Newzoo Global Game Markets Reports.

About the Author

Peter Warman is CEO and co-founder of Newzoo, the games market research and consulting firm servicing clients across all game business models and regions.

Sources:

 

Getting Developers To #1 In The App Store

BY

Scopely is a well-funded mobile gaming startup with a wide range of talent, and the company is both producing its own games and publishing games for other developers. CEO Walter Driver spoke with [a]list daily recently to discuss the company’s growth and its strategies for marketing in an increasingly crowded mobile gaming market.

Scopely CEO Walter Driver

Scopely’s been quite successful at getting games discovered. Rocket Jump, a team in New Zealand Scopely started working with towards the end of 2012 is a case in point.

“When we released their game Mini Golf Matchup,” said Driver, “It was the number one app on the iPhone in 29 countries within ten hours of launch, which was incredible.”

Driver believes that Scopely can find the right developers and the right products to create more such successes.

“We believe that there are a lot of game studios out there that are capable of creating really compelling products, but they’re going to need assistance in distribution technology and monetization funds to compete at the highest levels,” said Driver.

As he puts it, Scopely is trying to create “an exclusive network for the best independent developers where we can provide them with world class distribution and monetization expertise, as well as a technology platform that scales and allows them to get their product to market faster.”

Scopely is working with developers such as Tim Schafer’s Double Fine Productions, which is relatively new to mobile, as well as companies like Big Cave that won Apple’s Showpiece Game of the Year Award in 2012. Developers are looking for ways to get mobile products discovered, and Scopely’s audience growth and technology platform is appealing.

“We’ve been hearing from hundreds of developers from across the world over the course of this year,” Driver noted.

Of course, it’s not as easy as just putting a game into the App Store, even if you have a large audience. Driver explained what Scopely offers to developers.

“There’s really three parts of what we do for our developers,” he said. “One, we provide a server-side infrastructure platform that enables them to get to market faster. We have an API for all kinds of social functions that’s very well optimized already, and can help them develop much faster. Then, if you’re seeing 10,000 requests a second, Scopely can handle that size of audience.”

Creating a large audience for a new game isn’t just a matter of showing it to players of your current games.

“We’re always looking at innovative paid marketing channels,” Driver said. “It’s a very competitive landscape. But we also believe that you’re not going to build a transformational company by buying your users one at a time. Especially not in an area that there’s so much competition that any market that might be there might evaporate quickly, because it works for other developers as well. So we spend a lot more time on building products that people want to talk about and share with their friends. Mini Golf received over 130,000 reviews in the first eight days after it launched. It’s one of the most reviewed apps in the history of the App Store in the first week. These are the kind of products that elicit a strong response from people who say ‘play me in this game.’ That drives a much more sustainable degree of installs than paid banner ads, for example.”

As with other mobile developers, tablets are an important market for Scopely.

“The growth trajectory of the iPad specifically and the penetration that we’re seeing there is mind boggling in how fast it’s growing,” Driver said. “It’s one of the most exciting platforms for game developers in a really long time.”

Driver says that tablets have “significantly different play patterns than phones,” noting that “people tend to be playing tablet games when they’re committed to a recreation session for more than just a few minutes, so it lends itself to much more immersive experiences than you might be engaged with on your phone.” Driver said the bottom line for Scopely is that “both platforms are hugely exciting, and tablets offer great monetization potential as well because of that increase in engagement.”

Scopely has a broad range of expertise on its management team from a wide variety of companies and industries. The inference is that Scopely may branch out into other areas.

“It’s an astute observation that we have people from backgrounds like social product design, ad tech, and the video entertainment industry,” Driver said. “We can bring the knowledge of how to compete on a business standpoint or from a distribution standpoint or a monetization standpoint, bringing big brands like Vitamin Water or Starbucks to the table.”

The growth in mobile will continue strongly in the near future, Scopely believes.

“In the next 12-18 months there’s going to be really rapid growth in the smartphone market,” Driver said, “But it’s going to be primarily in developing and emerging economy. From a monetization standpoint those markets are not as mature. I think folks that are innovative in how to generate revenue from users in the developing world are going to do very well.”