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New report out – Client-based MMORPGs in Europe

client-based-mmorpgs-europe_coverWe are very happy to announce that we have released our first market report directly available on the website. This is a very specialised report as we looked into client-based MMORPGs specifically, with a deeper look on how they perform in the largest countries of the region (UK, France, Germany, Spain, Italy and Poland).

Here is the top-level bullet points on what you can find in it:

● General overview of the market: global size of the market, respective size of the key countries, business models popularity.
● Key data for the main countries: market size, preferred payment types, most popular games per language.
● List of the client-based MMORPGs in service Europe.
● Profile for each publisher with estimated revenues.

If you are curious about it, I strongly recommend to have a look at the table of contents of the report, and Joost from SuperData Research (we partnered with them on that report to make the research as complete as possible) has an article with a few key insightsfrom the report:

● The client-based MMO market totalled $1.3 billion across its major markets in 2012.
● Three publishers dominate the space, generating 70% of all revenues.
● Germany is the largest European client-based MMO market with €474MM in 2012 sales, more than double the size of the UK market (€281MM) and France (€222MM).

Since the inception of ICO Partners, it has always been our objective to provide more than our usual bespoke reports that we build for our clients. It took us some time to get to the point where we were able to build that first market report, and Diane has spent all her time for the past few months on it. Now that it has arrived, we have other segments of that market that we really want to dig into. You can expect more content on the Publications section of the website this year.

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Kickstarter for video games in the UK

Kickstarter launched in the UK a bit more than 2 months ago, I wanted to have a look at the initial set of data. That data sample is quite small still, projects usually run for 30 days, so you only really have 2 months and half (kinda – see below) to look at, but still, it seemed interesting to check the early days.

I also want to point out that the data collected was done differently this time. I have gone away from the manual collection of data and now run a fairly simple script to collect my info. This is still limited to successful projects only, but there is no lower limit on the amount those projects have raised as opposed to the $10 000 I had set before (I still think there is a point in excluding the small projects for my purpose in the analysis I am doing, but here, this is very useful).

Note:  I will refer to the UK project as GBP and the US ones as USD because the location of the creators doesn’t matter, it is the currency that backers see that makes a project UK or US.

First thing to keep in mind is that I think those numbers are not perfect, each month has its own issues. The way I looked at the data, by looking at the end date, means that there are a lot more USD projects. GBP projects were only available from the 31st of October, and thus all the USD projects that started before the 31st of October and ended in November are accounted for. That makes the data for that month very very hard to compare and thus, probably useless. I left it nevertheless.

December is a difficult month, Kickstarter even recommends to creators to avoid launching a campaign during that period due to budgets being tighter for backers with the holidays and the shenanigans at the end of the year.

And January is not over yet…

But I still wanted to have a look, see how it goes. Kickstarter did their own 1st month anniversary post (when a large proportion of projects launched in December were still probably running), so let’s have a look.

KS_001

There are a LOT more projects that are successful in USD than GBP. Without the number of projects launched in the same time, that might just mean there is a lower volume of projects overall, but it feels that quite a few studios in the UK have been waiting for the GBP launch, those numbers seem *very* low to me. we are talking about a grand total of 10 games funded in GBP, when at the same time,  there was 65 projects funded in USD! Even ignoring November, that’s a significant number of more projects.

KS_002

So, the different currencies make it extra difficult to compare projects. I have used a very linear conversion rate here (1.6) and I am bit afraid of what the data will look like over the coming month with varying rate. But what is interesting again is that GBP projects are getting closer to USD for the amount raised. This is due to very few, very high profile projects. In December, Project: Godus is 82% of all the money raised in GBP.  In January, Elite: Dangerous is 88%.

KS_004

That last graph, of the average percentage of the objective that has been raised, is the scary one to me. Both Godus and Elite were fairly high profile. And both succeeded by a low margin. We are far from the very strong success stories we have seen on USD projects. Again, numbers are very early in, taken from a time of the year that is a bit unusual, but the story it tells me is that GBP projects will take some time to be comparable to their USD counterparts.

I wish I had the success ratio analysis, that would be a more telling story on the actual situation for the GBP video game projects. My feeling is that projects in GBP have a slightly higher failure ratio, but that’s not backed by any proper data.

I would advise to GBP project to stick to lower objectives than what they would consider as USD project overall.

The good news for me is that I now have a proper script to make it easier to gather the data, I can now add all projects, regardless of the amount AND I support the multiple currencies Kickstarter has in its system. So expect more Kickstarter data post in the future (and we have a few other topics to discuss as well, don’t you worry).

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Kickstarter – Beginning of December numbers

In preparation for this week’s panel at Evolve, I refreshed the data collected on the successful Kickstarter Video Games projects. We decided at the last minute to focus more on projects stories rather than talking about data on the platform, but as the work was done, and it was 3 months since the last time I had a look, now is the perfect opportunity for a blog post on this.

The best is still for you to have a look at the document itself.

The panel this week was very one-sided in the end. Kickstarter has interesting challenges ahead of itself, but it is there to stay as a path for funding. That’s a very good thing in my opinion. The ecosystem will evolve, get more mature and we will get a few good and bad surprises still. A point I think I missed making during the panel though, is the very strong reliance on media, whether you talk about traditional media, or social media.
Social media is not much of a concern – they lend themselves very well to promote crowdfunded projects and Kickstarter makes a good use of them (Friend’s Discovery, I curse thou and my wallet too!), a number of projects were successful thanks to the support of traditional media and there tend to be some fatigue on their part. As the novelty of Kickstarter is wearing off, they tend to be either more critical (a good thing!) or not interested (a sad consideration).
Last thing, I will share my number two tips for going to Kickstarter, as asked at the end of the panel (arguably, we were asked the number 1 tip, but hey):
1# Become a backer yourself. Go on there, find projects you like and give them money. Go and live through a project’s campaign till its end (happy or sad) as a backer. That an important position to understand.
2# Do your homework. Don’t go on kickstarter without checking which projects work, how much they ask for, what they offer to backers, etc. especially, look for projects similar to yours.
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Panels ahoy – Game Connection Europe and Evolve London

The year is not just over yet and I will be attending a couple of events before the holiday break. You are very welcome to join and say hi if you are at the events.

Game Connection Europe

The event starts tomorrow, in Paris, and I will be contributing to two panels there:

– I will be moderating a panel on marketing entitled New vs Old – What does Video Game Marketing Look Like Now? where we will discuss what has changed in today’s marketing, and what didn’t change. It’s on Thursday at 3pm. Link

– On Thursday as well, at 5pm, I am one the two panelists invited to talk about… big surprise… Kickstarter! The panel, creatively named Funding Your Game with Kickstarter, is moderated by Kickstarter’s Cindy Au and my co-panelist is Stainless’ Matt Edmund. I suppose he will be talking about Carmaggeddon and I will be sharing my experience from the Strike Suit Zero campaign. Link

London Evolve

On the 11th of December in London, I will be on the Kickstarter panel taking place at 5pm. This should be a very different discussion, more focused on the potential of that platform as well as its risks and shortcomings, as the title implies:Kickstarter : Industry Game Changer or Flash in the Pan? Surprisingly, I think I am the “pro-Kickstarter” component of that panel. Link

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Gstar thoughts and feedback

While it is still relatively fresh in mind, I want to share about our experience from the Gstar 2012 and what we saw and learned there.

First of all, you can find a summary of the event over at Thisisgame:http://www.thisisgame.com/en/2012/11/19/gstar2012-wrap-up

As highlighted in the article, the most impressive change from last year’s event was the very strong switch to mobile that Korea is operating. So, of course, there were still many online games present, but having probably around 50% of the B2C showfloor taken by mobile publishers was very impressive (and think about it, how much space is usually taken by mobile games at other shows?).

And that’s my biggest take away from this year discussions – Korean developers left that online corner they stayed in for so long and a lot of them moved to mobile. Last year, there was an interest in social games, but this is nothing like it.

There are multiple reasons for that strong change in the developing landscape, but the biggest one mentioned is the stellar (recent) success of Kakaotalk in the game space.

Kakaotalk is an online chat app for mobile (with VOIP as well) that has been very widely adopted in the country. It runs on iOS and Android (and Bada and other OSes that don’t matter much) and many operators bundled it and its adoption is crazy.

In July, they launched their first games (on the Appstore for iOS obviously, and Google Play for Android), including Anypang, a match-3 game, heavily using the Kakao contacts as a social graph (leaderboards and gifting). The game has been *very* successful. They report 10m DAU, in a country of 50m inhabitants (I think users outside of Korea are negligible), and significant revenues (that figure varied a lot depending on who you talked to but it averages around $1m per day).

It has created a lot of attention to the mobile space in general and Kakao in particular – with many studios lining up to integrate with them. It also means that money from investments is quickly leaving the MMO space towards the mobile space.

If you are interested in that market, I recommend you to have a look at the Kakaotalk app: http://www.kakao.com/talk/en

And Dragon Flight, the current game doing very well for them (Google Play link):
https://play.google.com/store/apps/details?id=com.NextFloor.DragonFlightKakao&feature=nav_result
Discussing the Kakaotalk success last week, I was asked why I thought it worked so well, compared to Facebook for instance (or Skype). I think a short answer should be: “Check the app!”.

It is very easy to use, very quick to load and does what it does very well. This is a Dropbox case: service existed before, but was overly bloated (see Skype – I won’t launch the app on my phone, it takes ages to launch, ages to load, difficult to navigate). Kakaotalk also works on every device.

It seems that in Japan, The Line, a similar app, might get the proper momentum and build a similar success and start challenging DeNA and Gree presence. And we might have other apps doing the same in different countries. Whatsapp was mentioned (SEA and Spain), as well as Tango (North America)…

Interesting to see how this will develop…

When discussing with local developers and publishers, I collected a few rough estimates on the mobile market make up. Take those with a grain of salt, but it does help in getting an impression:

In the past year, the mobile OS distribution seems to have completely shifted. Where iOS was the main one a year ago, Android has taken over (through Samsung devices mostly but not exclusively). I was told 89% Android, 10% iOS, 1% margin of error for others – it is probably exaggerated but it highlights the current trend.
Another change, the carrier Android app stores have lost lots of market share, with Google Play being currently the main App store (about 50%), followed by Tstore – the android app store of SK Telecom (30%), Apple App Store (10%), and Others completing the count.
That change seems to have happened through users getting educated about the ecosystems (and not liking being tied to their carrier for their apps) as well as Kakaotalk pushing all its android distribution and payments through Google Play.
One last bit of relevant info: I was told that there was close to no piracy on Android in Korea.

Like every year, going to Gstar was a very good experience. We had excellent meetings, we were able to have a peek at trends from a very different territory and we met with local industry people that we don’t have the opportunity to catch up with at other events.

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Kickstarter interrogations

After having observed for some time the Kickstarter ecosystem and crunch its numbers extensively, I have found myself involved in a Kickstarter campaign with one of my client.

The game in question, Strike Suit Zero, has been in development for a while, and I have been involved with it since the very beginning (and the game is NOT an online game, a very unusual occurrence for me). Its campaign is in its second week, and doing very well with 90% of its objective reached. I am obviously very excited by the current situation, but my point here is not to talk about this project specifically. This will likely come later, probably as a post mortem on what I assumed it was like to run a Kickstarter and it was really like to run one.

Today, UK Kickstarter projects can be launched, and this is a major milestone.

The process to open a US Kickstarter is certainly not easy, even less when the main team is based overseas. So this expansion to the UK is going to be a tremendous opportunity for a vast number of creative people. But it comes with a lot of uncertainties too and the following days are going to be very interesting. So let me lay out for you some of the questions I have at the moment (especially for the early days, I have to say):

• I anticipate a Tsunami of projects to land just about now. Momentum is absolutely paramount for a campaign to work out. With all those projects, are there going to be a lot of attention that very few will benefit from? Is it going to be so diluted that only very small scale projects will actually succeed? Are they going to behave the way the current US campaigns do?

• With that influx of projects, are the US projects going to struggle? Is it going to have no influence? Are they going to benefit from the influx of traffic overall?

• How will the Kickstarter communities react to seeing prices in GBP/£? The audience is still massively from the US (and that seems to be changing over time but still), how comfortable will they be pledging in a currency not their own? I feel Europeans are a lot more exposed to USD as a currency on a regular basis and more likely to accept this. But I might be wrong.

Overall, Kickstarter for me is still very much  an evolving creature and I have a lot of other unanswered questions of that nature. Like, how will the ecosystem evolve after a few fairly large “failures” (either a large campaign that just never delivers its rewards or one that delivers way below the expectations)? What is the Kickstarter/Sales ratio? How much more revenue do you make off a successful campaign – are you merely making the same amount of money or is Kickstarter really just the tip of the iceberg (I suspect a few projects have been gambling a lot on what that ratio will be)? Project Giana has now launched and might now know? I should probably go and ask the FTL guys too…

In any case, I am very curious (and quite excited too) to see what the UK launch is going to bring us even if I ultimately believe this will be a good thing and expand the crowdfunding volumes overall.

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