Following up from my blog post from last month, and in an attempt to do this regularly, I went and ran some numbers for the month of March in regards to the presence of the games industry in the media.

The same disclaimer applies:

The tool I am using is far from perfect. It gets hits on false-positives, some terms are impossible to get hits on and it is somewhat dependent on how clever I am when I create the monitoring criteria for a specific game if the name is quite generic. The tool is also dependent on the alerts I have entered. There are many prominent games that are absent, mostly because my primary interest when I started working on it lay with online games. I am expanding that list now, but do not take the stats as an “end all” proof that X game is totally ignored by the media.

 

I am only sharing the graphs showing the number of articles for a given topic – we are also using a weighted value based on the sites’ reach, but this time around I wanted to keep things simple. So what you see here is relevant about quantity, not necessarily quality. It is important to note that we purge the results coming from fansites (dedicated to one game) and content farms (that just repost other websites’ content). I am just sharing the current results because I feel they are interesting at illustrating the trend for the month of [March].

 

tl;dr: Take all this with a grain of salt.

March is an interesting month for the game industry. The lull from the holiday period is basically over, you have the announcements there for the ramp up to E3. you have the announcements piggy backing GDC and the concentration of media there.

And then, there was Facebook outright buying Oculus Rift before the DK2 is even out… But more of that later.

Games

201403_games

The most obvious observation is the sheer domination that Titanfall still has on the coverage of the month of March, with twice as many articles as Watch_Dogs. Launching a blockbuster at the beginning of the year, alone in that period, pretty much guarantees media coverage. I suppose the marketing budget spent in parallel helps a lot too.

The second observation, is the strongest presence of AAA titles there. I think it comes from a double effect: I have been a bit better at including those games in the monitoring tool and those games are all ramping up with their communications. For the games I was properly following already in Feb, the increase of mentions is still quite significant (ie. COD went from 2,139 articles in Feb to 2.650 articles in March – the longer month alone cannot account for that difference).

Diablo 3′s Reaper of Souls launch has had an obvious effect on the game’s presence in the media.

I find interesting that Elder Scrolls Online dropped from 2,030 articles last month to 1,631 in March, just ahead of their launch.  We shall see the impact their CGI trailer had along with the launch (spoiler: April is not over and already has twice as many articles as March).

A lot of the games there had major announcements or release in March still – and it makes for a more intense period than February.

And for those who are wondering, there were still about 1,100 articles about Flappy Bird – that’s more than Heroes of the Storm…

Platforms

201403_platforms

Interestingly, the consoles stayed relatively at the same levels, with Playstation 4 the only one with a notable increase (from 26k articles to almost 30k articles), mostly thanks to the announcement of Morpheus that had 2,000 just for itself. Also, I haven’t followed well enough the news on the mobile front to tell you why iOS got those extra articles.

One change from the tracking from last month is the inclusion of the Wii there – as opposed to tracking Nintendo in the mentions as I did last time. For this reason, I can’t tell if there was a drop-off for the machine’s mentions.

And before looking at the VR devices, I have to say I am very surprised by the incredibly low number of articles relaying the Amazon Fire announcement. I think it comes from the fact that Amazon only mentioned games in passing (the initial news was actually quite unclear about that part of the offering) and it didn’t create interest in the video game media.

Oculus and Morpheus

As a VR enthusiast, March was a roller coaster of announcements… Oculus started things off  by finally announcing its DK2, then with Sony formally announcing and presenting Morpheus at GDC, followed by Michael Pachter denouncing Sony and the Morpheus as a bad move with VR being a niche too small for them to pursue. And finally, that notion of VR niche was blown apart by the announcement of the acquisition of Oculus by Facebook.

To give you a sense of the impact of the Facebook announcement, here is a graph with the number of articles per day for Oculus and Morpheus until the 24th of March:

oculusvsmorpheus-til24032014

At that point, Oculus had 2,200 articles, 50% more than the previous month. Their announcements along with the Morpheus reveal had created a surge in articles about them. Then, there was the 25th of March:

oculusvsmorpheusdailymarch2014

It is incredibly difficult to tell what the future holds for those technologies, but purely on the level of media awareness, this has been a massive month. And interestingly, both products have benefited from the media presence of the other.

Here is my last graph. The break down is different for each product, but I thought I would present them together to save some space.

For Oculus, in blue you have articles only on Oculus and in orange articles mentioning both Oculus and Facebook.

For Morpheus, in blue you have articles only on Morpheus and in orange articles mentioning both Oculus and Morpheus.

201403_oculusvsmorpheus

Despite the massive impact the Facebook announcement had, Oculus is really standing on its own and has an excellent media presence.

As for Morpheus, they are benefiting a lot from that media presence – more so than the fact it is being backed by an industry giant such as Sony (though that helps them massively for the credibility of the project).

As always, let me know if you have questions or comments.

This week I was in Berlin for the 2014 edition of Quo Vadis. The event is visibly growing every year and it has shed its German skin to become more international (I think that 3 or 4 years ago, english-speaking lecture were the exceptions, the past two years had zero German-only content; that’s quite a quick change).

I won’t go into the panel about luck in business that I was sitting in on Wednesday, not because it wasn’t interesting, but mostly because one big fascinating chat and I couldn’t take notes. It was great though. Just believe me. Or ask someone who was there and took notes.

Yesterday, I presented a “State of crowdfunding for video games” and as usual, I am sharing the slides of the lecture:

Looking at the slides again, they are not all very self explanatory but the recommendations in the end should help significantly. If you have questions, hit the comments.

A growing activity for us is our PR services that we provide under the ICO Media brand. While this is a topic that we have very rarely discussed on this blog, we are developing in many ways and I might share more on the topic in the future (it is unlikely however, that I will discuss anything specific related to the work we do for our clients).

So, we do PR. But as you may have noticed, I tend to like data and I value information that is backed by numbers and not just intuition. For the past year we have been developing a couple of tools in order to make the team’s work easier and/or more efficient. As a “happy accident” from the building of these tools, I have now a monitoring tool that tracks articles mentioning specific game-related terms in our database of websites (about 5,000 sites IIRC). I have been feeding the tool with specific search for a few month now and what I will share today are the results for the month of February for a number of video games and video games platform.

Disclaimer The tool I am using is far from perfect. It gets hits on false-positives, some terms are impossible to get hits on and it is somewhat dependent on how clever I am when I create the monitoring criteria for a specific game if the name is quite generic. The tool is also dependent on the alerts I have entered. There are manyprominent games that are absent, mostly because my primary interest when I started working on it lied with online games. I am expending that list now, but do not take the stats as an “end all” proof that X game is totally ignored by the media.

I am only sharing the graphs showing the number of articles for a given topic – we are also using a weighted value based on the sites’ reach, but this time around I wanted to keep things simple. So what you see here is relevant about quantity, not necessarily quality. It is important to note that we purge the results coming from fansites (dedicated to one game) and content farms (that just repost other websites’ content). I am just sharing the current results because I feel they are interesting at illustrating the trend for the month of February.

tl;dr: Take all this with a grain of salt.

On to it then.

Games

PR_Intel_Feb2014_games_articles2

The media like blockbusters. And blockbusters like media. Titanfall being a bit alone for the beginning of the year [arguably, I missed a few AAA that also have launches in the Q1, but let’s not focus on what is missing] and it seems normal that it is standing out so much. They had a lot of actuality as well during Feb. However, you can see that blockbusters from Q4 are still getting a lot of coverage (BF4, COD, Batman and GTA), despite having weaker announcements.

Elder Scrolls Online also stands out – you can see the license in action there as it is unusual for MMOs to get a very wide coverage – with the obvious exception of World of Warcraft. Online games in general tend to get more regularly covered once they have proven their worth – as shown with WOW, but also with League of Legends and World of Tanks as well as (in its own unique way) Minecraft.

It is also interesting to see that Watch_Dogs is below the coverage I would have expected – but you can see now as we are in early March, Ubisoft is cranking it up again.

I left the obvious outlier for the end, the odd event of the month and a fascinating one from a PR perspective: Flappy Bird.

I am very confident that even with the AAAs I missed (current trends for March make me think that Castlevania, Assassin’s Creed, Infamous and Dark Souls would have made it in that top 15 had I added them early enough), Flappy Bird would have had that same (second) position. It is obviously a black swan but one that I find fascinating (as anyone who talked to me in the past 4 weeks can attest). Beyond the impossibility to reproduce such a phenomenon, I still think it gives an excellent lesson in what makes media pick up a news: the story.

Flappy Bird hits the mark on so many levels:

– Money (reported daily income for the lone creator from a poor country)

– Drama (the hate towards the creator; the creator taking drastic actions)

– Exotism (Creator living in Hanoi)

A perfect storm… And a good lesson. We very regularly discuss with studios on how they should approach the way they present their games to the media. Way too often they are lacking the story component. Of course you need to talk about your game and what it is about, but putting it into context, presenting a narrative (the studio’s, the origin of the core concept, or anything relevant really) will make it that much more appealing for a journalist to cover it. I would advise strongly against taking this advice as a spin on “there is no bad publicity” – you will always want to be a positive story in the end.

Back to the bird.

01_Number-of-Articles-Flappy-Bird-Feb-2014

02_Number-of-Articles-Titanfall-Feb-2014

03_Number-of-Articles-Flappy-Bird-Titanfall-Feb-2014

Another fascinating aspect is that the game got a lot of its coverage over a weekend. If you look at the Titanfall chart, you see the big drop that happens then. Flappy Bird’s removal started over the week-end, and it was still massively picked-up with a huge follow-up on the next Monday, where all the media that missed it played catch up.

In case you are wondering what is the 17th of Feb bump related to, it comes from the news that Apple and Google were cracking down on the Flappy Bird clones. An aftershock of sort.

This must also be considered within the context that mobile game get very little real media coverage. To give some reference points, Candy Crush Saga,  in the midst of January’s trademark debacle, had 725 stories mentioning them over the month, peaking at 172 articles on the day the story broke out.

And, in a most impressive way, if Flappy Bird is absent from the app stores, it has stayed in the news. It averages at 40-45 articles mentioning it every day. That the same average you see for World of Tanks (on their quiet day).

Platforms

If you need to take all the previous graphs with a grain of salt, you need to take the following up with a bucket. I looked into “platforms” that are currently prevalent in the game industry and the number of articles that mention them – however, our database is very skewed towards video game website while still including a number of tech websites.  So what you have here is very unrefined data, pooling things together that probably shouldn’t be pooled together. I still find that somehow relevant and an interesting check on what online media are covering.

I was tempted to remove iOS and Android from the chart – they get a lot of their mentions from tech websites that tend to delve into new devices and new OS features and not be very relevant from game industry point of view, but leaving them here doesn’t do much harm and give a sense of scale for the media presence they have.

PR_Intel_Feb2014_platforms_articles

Unsurprisingly, the “brands” are leading the way in a significant way. If you wonder why “Xbox – Brand” doesn’t equal “Xbox One” + “Xbox 360″, that’s because some articles mention both machines while others only mention “Xbox” without being specific about it.

Our tool is covering websites from all over the Western hemisphere. With Europe and its fragmented landscape, we have way more European websites though, and the prevalence of the Playstation brand there shows in the volume of articles they get, regardless of the generation. It is possibly mitigated by Titanfall’s very strong media presence, considering the game won’t be available on the PS4 – something to research at a later date perhaps.

The fact that Nintendo is getting an equal amount of coverage as Steam is very impressive of Steam (or very depressing for Nintendo?), and clearly showing how much of a power house it has become. I would expect this to continue and the media presence of Steam to even grow with time – despite Valve’s very hands-off approach to PR.

I find the Oculus Rift performance very promising. The device is clearly sparking the imagination, and the novelty factor is working for them. For reference, in February, they announced their exclusivity deal for EVE Valkyrie; shortage of components for the Dev Kit (and thus, shortage of Dev Kits); and they got a fair number of mentions from the announcement that Sony would show its VR headset at GDC. For comparison though, they had about 1,900 articles mentioning the Oculus Rift in January – that was mostly thanks to the Steam Dev Days. In any case, for a technology that is not publicly available and with no firm release date, the interest is there.

I am not sure I need to comment the Ouya media coverage at this stage – but it is one I keep an eye on.

After writing my blog post on the 2013 numbers for games on Kickstarter, I felt like there was even more information to provide. While I am mostly following the crowd funding phenomenon in relation to games, the way we datamine Kickstarter means we have a lot of data for other categories too – sharing these is just a matter of taking the time to collate and make them presentable.

With Kickstarter hitting its first $1bn pledged this week, it appears to be perfect timing to provide more information to crowd funding enthusiasts. I hope you find it useful.

divination1I am massively late in writing this post, and apologize to our blog readers as we didn’t have much time to blog in the last months. Like in previous years, I will try to outline what I see as the biggest trends for online games for 2012.

 

Platforms

 

● Mobile and tablets : It’s a very easy prediction to make, and not very risky. We think iOS will remain a potent platform thanks to high ARPUs, and the explosion of Android-powered devices is finally constituting a huge addressable market in terms of volume, even if you consider the fact that the Kindle Fire doesn’t help much for the growth of that platform for games (limited hardware and more important, very tied to the Amazon ecosystem). Overall, the market for Android games in the short term is very dependent on Asian markets, which may be a challenge for Western developers. Some surveys tend to show a slowdown of apps developed for the platform as a result, which might make it an even more interesting market for those companies who know how to profit there.  The total value estimates of mobile gaming for 2012 varies a lot, due to the uncertainty of estimating that growth, but most analysts put it between $3B and $11B .  The PC segment will be gradually supplanted by smartphones and tablets. That should bode very well for connected games on these platforms. The average monthly playing time is around 15 hours for iOS and 9 for Android gamers, but  companies like Spacetime Studios, with its Legends series (Pocket Legends, Space Legends, etc) are already at 25 hours. We are still far away from the average PC MMO player in terms of time spent (70/80 hours/months), but it is going up fast.

In terms of revenue, free apps with micro-payments are quickly becoming the standard there. ARPUs tend to be better than social games due to higher ARPPUs (ARPPUs above $10 are increasingly common), the average revenue per transaction being just under $15. Better news still, tablet games command even higher ARPUs, and even if the market is still small with an estimated worldwide installed base of 81M in 2011, it’s expected to grow to just under 400M in 2015.

 

● On those mobile platforms, we still hear a lot about HTML5 supplanting native apps. This might be increasingly true for the more casual end of the market (as companies like Zynga and Spil have started heading there), but as the higher value segment games become more complex, the “big client” apps (more than 50 Mb) will also progress. This is for instance where Glu Mobile is headed if you read their last investor relations document.

 

● Does it means that PC online games will die? Certainly not, but they are likely to focus on specific consumer segments : hardcore users on traditional PC genres (as was shown this year with the success of the MOBA genre, led by League of Legends, and action/shooter games such as World of Tanks or Combat Arms),  browser-based games targeted at office gaming, maybe kids and teens who don’t own portable devices. The “middle core” is likely to be squeezed out, along with the categories where the competition is making success more difficult such as RPGs(see genres).

 

● Social gaming seems relatively constrained on Facebook, as acquisition costs keep rising. According to recent figures from Atul Bagga, a ThinkEquity Analyst, Zynga’s cost per acquisition increased fivefold in 2 years, from $0.3 in 2010 to $1.5 now. It gives more weight to the big publishers there as they can rely on cross-promotion better than others, and also pushes everyone to focus on better retention and monetization. That is probably good news for companies such as Kabam and Kixeye. Retention remains a problem and sequels don’t work there, so we can also expect better endgames. Also, more social gaming companies in 2012 should try to push distribution to other platforms than Facebook where their margins won’t be so squeezed, whereas on their own platforms (like Zynga Direct), competitor SNS or via embed on every possible platform (a strategy that so far was pretty successful for Goodgame Studios, for instance).

 

● We also hear a lot about connected TVs, but it seems to us that it won’t be such a big trend for 2012. Samsung announced it sold 2 million devices in June last year, and it is looking to sell 25 million in 2012. However, this will depend on the replacement rate for the household television market, and we would bet on it to be very tied to the overall economic situation, and at least in Europe it should stay gloomy. It is also likely that the big players on this space will be those already present on the mobile space, but they will have to solve other challenges such as gameplay input.

 

● Cloud gaming seems still promising on paper but we also doubt it will become really huge in 2012. OnLive is apparently in the range of 2.5 million subscribers and is likely to have its international growth limited to some markets due to infrastructure issues. Gaikai has reached 10 million MAU but will probably be limited in its growth due to their business model : even if they do reach 100m MAU as they target in 2012, it will still remain very limited to limited-time demos of mostly product-based games.

 

● We still believe that more industry players will try to implement some forms of cross platform features and gameplay during 2012, particularly in the interactions between web/social/mobile . However, few companies are well positioned so far for doing so, as the successful tactics are very specific to each platform.
Business models and business topics

 

● By now we can already consider that the “free to play with micro-payments” business model has largely won, with the exception of a few cases where actively limiting ARPPU makes sense , mainly in games for kids (where the parents might object). Even in that case, alternate solutions such as wallets or spending limits might work better. Does that mean that subscriptions will die completely? Once again, probably not, as they may as well mutate. In many micro-payment free to play games, there is a “subscription-like” option where bundles of services or special are offered at fixed price points. Also, in the few remaining subscription-only games, there are a couple of extra services that are generally paid in addition to the subscription fee (although generally they are very one-time in nature, as opposed to consumable-based cash shop item majority.). The main problem with subscriptions are the cap on revenues and the barrier to entry. If those are removed, subscriptions can become attractive again.

 

● Player acquisition is set to continue being a major headache. On the web, iQU published recently stats that showed a 152% increase in CPL in UK, US, FR and DE territories. On mobile, the cost to acquire a loyal users for an app (opens it 3 times or more) was $1.81 in December 2011. On social, as stated above, it has increased 500% in 2 years for some actors. As this seriously eats into industry margins, it will probably lead to the demise of the less efficient players (expect some more concentration in 2012, particularly in the most mature segments such as client-based and browser-based MMOs), the rise of big traffic purveyors (eg increased partnerships with old-media and web portals), and increase the incentives for companies to capture underserved segments, for instance demographic (eg male 30+ is coveted by companies such as Supercell and Cliffhanger Production), geographic (Eastern Europe, Turkey, Indonesia, Brazil…). At Browser Games Forum in November last year, it was asked when publishers will start directly paying players to try their games (like the poker industry does). I don’t think this will directly happen in 2012, as CPAs are not that high to be a sufficient motivation for players, but maybe we’ll see some meta-rewards companies getting there. For platforms with very limited acquisition options (like mobile), we should see more dirty tactics (or cleaner ones in terms of incentivisation) to game the system on the one hand, and more reliance on other mechanisms such as virality, curation, branding, etc. to escape the system on the other hand. Mobile could also benefit from IRL discovery mechanisms : outdoor advertising, “tupperware parties” etc.

 

● The resulting focus on retention and monetization will lead to a better command of analytics by all actors, and probably to the development of better reacquisition channels and CRM. The past year has seen a lot of CRM tactics employed by the social games industry, mainly through email. The mobile segment is so far bad at retention : churn for all apps was estimated at 62% in the first month by Flurry. Once again, tactics such as community management, events, CRM, tournaments, branding will develop over time to boost retention rates. Tools and UI to help manage existing apps should also improve. In terms of gameplay, that should bring better endgames and more attention to long-term gameplay (whereas the recent free to play move focused a lot on the initial experience only).

 

● Is that the beginning of the return of third-party publishers? So far, it seems that it’s still difficult to operate online games from another developer. Recent PC successful companies like Riot Games or Wargaming chose to operate the games themselves in all territories. Most browser-based successes such as Farmerama  have also been developed internally. So far, third party games published by the likes of Jagex and Innogames have not materialised the same success as their forbearers. In the case of existing publishers with different entities, the trend has been to decentralise completely the activities and let the studio run all the operations (as Bluebyte did for Ubisoft, or EAsy and Playfish are doing at EA.). In social games, there has been a lot of announcements for third party publishing (Playdom/SpryFox, RockYou third party deals, 6waves/Lolapps) but there hasn’t been stories of hugely successful 3rd party products (also, probably because it’s still easier to buy the company or clone the game.). For mobile, things are slightly different as there aren’t so many truly online and connected mobile games. And for mobile and social games it still makes more sense for a publisher to quickly buy the developer than to publish them as third party. We’ll see, but I wouldn’t bet on a return of publishers so far. What I’m ready to bet on, is an increased reliance on third party tools and services for online games companies.

 

● Speaking of those, we should see yet more concentration on services where the differentiation is low and the margins are getting thinner, mainly traffic acquisition and payments. Both industries should see concentration (or further concentration in the case of payments) and differentiation strategies.

 

 

Genres of games

 

● Old-school PC MMOs should stagnate or decline, as there aren’t so many pharaonic huge client based games in the pipeline and retention rates should drop for the most recent ones due to the lack of innovation. Most of those not released yet are coming from Asia and are also likely to run into 3rd party publishing issues.

 

● More action : it’s another trend we see continuing: the traditional point’n’click MMO gameplay is replaced by alternatives coming from different game genres – from action-RPG to fighting game to FPS . In a parallel course, most traditional genres are starting to include MMO elements. This is also true for mobile games, similarly to Spacetime Studios’ Legends series they should become more real-time, while incorporating asynchronous elements.

 

● More crossover  declinations of successful genres : eg Infernum’s Minecraft/FPS combination, MOBA/RTS mashups like Tindalos’ Stellar Impact, etc. Most of the innovation will come from indie studios. The downside is that those gameplay mechanics will be copied quickly if they prove successful.

 

 

Please don’t hesitate to discuss and give your opinion in the comments!

Available now is our latest market report. We have taken an in-depth look at the MOBA sub-genre, specifically its presence on the European markets. This is an extensive report, looking at each game as well as every single market, and drawing an interesting picture of the current trends in the genre.

With an estimated revenue for all the games in Europe of €173m ($237m) for 2013, MOBA games have been growing very rapidly in the past few years and should continue to develop for the foreseeable future. Below, you can find the foreword to the report as well as the table of contents. As usual, don’t hesitate to contact us if you have any questions.

The MOBA genre is still in its infancy. Born out of the Warcraft 3 mod community with the Defense of the Ancients map, it was a genre limited to that space for many years. As this community grew it reached a critical point that either prompted game studios to consider the genre as viable for a stand-alone game, or the community matured enough to take their expertise from modding into full game development.

 

The definition of the MOBA is still evolving. Like any newly created popular terminology, its usage will vary from person to person until it reaches a point of compromise (or academics dissecting the game landscape narrow down a very specific definition). We have decided to stick to a rather strict definition for this report and only integrate the games that have directly inherited from the Defense of the Ancients core mechanics: players in teams each control a powerful unit and try to outplay the opposing team by controlling the flow of a battle, destroying objectives or simply killing the enemy players’ units.
For players, the main appeal of a MOBA lies in the depth of gameplay: the numerous units available, the number of development options for those units and the understanding of the different match-ups to react to the opponents’ decisions. It also means these games are very competitive, require a great deal of time to be properly mastered and have created communities that are highly engaged, yet passionately demanding and not always tolerant (one could say toxic).

 

However it is that passion from the players that it is a contributing factor in MOBAs emerging as a major genre at the moment – and the audience of those games is equally demanding when it comes to the quality of the games, making it a difficult genre to enter.
It doesn’t appear to scare new entrants though. As we finalised this report earlier this year there, came a point where we had to stop adding titles to the list of announced MOBAs as these new game announcements were being made on a weekly basis.
We feel this report is being released at a very interesting time for the genre. It will allow a line to be drawn in the sand, and a snapshot to be created for the state of the European MOBA market. And it should help us (and you) see where the market will go from here and how this new genre will develop and grow.

 

Thomas BIDAUX, ICO Partners CEO

February 2014

Brighton, UK

MOBA Games in Europe 2013 – Table of content from ICO Partners

You can purchase the report directly from our website or you can contact us.