KGC09 Online Games market in Europe

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Slides from the presentation on the European market for online games, as presented in Korea in October 2009 for the KGC.

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KGC09 Online Games market in Europe

  1. 1. Online Games Market Europe
  2. 2. The Plan <ul><li>Introduction </li></ul><ul><li>High-level market overview </li></ul><ul><li>Building a European strategy </li></ul><ul><li>Q&A </li></ul><ul><li>Disclaimer: All numbers are estimates </li></ul>
  3. 3. Introduction
  4. 4. The Speaker <ul><li>Thomas Bidaux </li></ul><ul><ul><li>GOA.com (France Telecom) </li></ul></ul><ul><ul><li>NCsoft Europe (Lineage 2, Guild Wars) </li></ul></ul><ul><ul><li>ICO Partners </li></ul></ul><ul><li>Released 7 MMOs in Europe </li></ul>
  5. 5. Europe? Herman Moll - 1708
  6. 6. Europe?
  7. 7. Europe?
  8. 8. European Union
  9. 9. Europe in Numbers (1) <ul><li>Superficy </li></ul><ul><ul><li>4 300 000 km² </li></ul></ul><ul><ul><ul><li>China – 9 640 000 km 2 </li></ul></ul></ul><ul><li>Population </li></ul><ul><ul><li>500M in Europe </li></ul></ul><ul><ul><ul><li>USA - 300M </li></ul></ul></ul><ul><li>Density </li></ul><ul><ul><li>114/km² </li></ul></ul><ul><ul><ul><li>Korea - 493/km² </li></ul></ul></ul>
  10. 10. Europe in Numbers (2) <ul><li>Internet Users </li></ul><ul><li>Consoles </li></ul><ul><ul><li>11.2M PS3 (46% ww) </li></ul></ul><ul><ul><li>12.4M Xbox 360 (39% ww) </li></ul></ul><ul><ul><li>20M Wii (38% ww) </li></ul></ul>
  11. 11. Market overview
  12. 12. European Market <ul><li>Size of the Internet market </li></ul>Broadband lines per 100 inhabitants. 2008
  13. 13. European Market <ul><li>Popular Online Games </li></ul>
  14. 14. European Market <ul><li>Size of the Market </li></ul>WOW Servers
  15. 15. European Market <ul><li>F2P vs P2P </li></ul>
  16. 16. European Market <ul><li>F2P vs P2P </li></ul>(from 400+ games currently operated in Europe or under development)
  17. 17. European Market <ul><li>Free to Play Market </li></ul><ul><ul><li>Driven by browser-based </li></ul></ul><ul><ul><li>Some succesful client-based Free to Play </li></ul></ul><ul><li>EU Estimates </li></ul>
  18. 18. Estimated market size: 30M+ F2P online games players in Europe 400+ games Estimated revenue : 400-500M€/year European F2P Market
  19. 19. European Devs <ul><li>Online Games Studios </li></ul><ul><ul><li>173 studios </li></ul></ul><ul><ul><li>300+ projects </li></ul></ul><ul><ul><li>Compared to US : </li></ul></ul><ul><ul><ul><li>Less VC-backed </li></ul></ul></ul><ul><ul><ul><li>Less video games background </li></ul></ul></ul><ul><ul><ul><li>Successful bootstrapped web studios/hobby projects </li></ul></ul></ul>
  20. 20. European Devs <ul><li>Prominent Studios </li></ul>
  21. 21. European Operators <ul><li>Local subsiduaries </li></ul><ul><ul><li>Blizzard – WOW </li></ul></ul><ul><ul><li>NCWest– GW, Lineage 2, City of Heroes </li></ul></ul><ul><ul><li>Club Penguin – Club Penguin </li></ul></ul><ul><ul><li>Gala Net – Flyff, Rappelz </li></ul></ul><ul><ul><li>Aeria Games – Last Chaos, Shaiya, Megaten </li></ul></ul><ul><ul><li>Nexon – MapleStory, Combat Arms </li></ul></ul><ul><ul><li>SquareEnix – FFXI </li></ul></ul><ul><ul><li>Ndoors – Atlantica Online </li></ul></ul><ul><ul><li>NHN – Karos Online </li></ul></ul>
  22. 22. European Operators <ul><li>Local actors </li></ul><ul><ul><li>Codemasters – Lotro, DDO, Jumpgate </li></ul></ul><ul><ul><li>GOA.com – DAoC, WAR, Goa.com </li></ul></ul><ul><ul><li>Frogster – Runes of Magic, Bounty Bay Online </li></ul></ul><ul><ul><li>Gameforge – Metin 2, Ogame </li></ul></ul><ul><ul><li>Bigpoint – Seafight, Dark Orbit </li></ul></ul><ul><ul><li>Gamigo – Level R, Last Chaos, Shot Online </li></ul></ul><ul><ul><li>Burda IC – Florensia, Ragnarok, Alaplaya </li></ul></ul><ul><ul><li>Games Masters – Cabal Online, Perfect World </li></ul></ul><ul><ul><li>MAYN – 12Sky2 </li></ul></ul><ul><ul><li>Rourke – Priston Tale 2, YS Online </li></ul></ul><ul><ul><li>Gametribe – DOMO, Dekaron, Infinity, Kicks Online </li></ul></ul><ul><ul><li>Playmedia – ASDA Story </li></ul></ul>
  23. 23. Prominent Games Game: World of Warcraft Genre: Client MMORPG Developer: Blizzard (USA) Numbers: 2 000 000 Subscribers; ARPPU 13 € Key territories: UK, Scandinavia, Germany, France, Spain
  24. 24. Prominent Games <ul><li>Game: Dofus </li></ul><ul><li>Genre: Fantasy MMO (Flash/java) </li></ul><ul><li>Developer: Ankama (France) </li></ul><ul><li>Numbers: 170 000 PCCU; 500 000 Subscribers; 3M active - ARPPU 5 € </li></ul><ul><li>Key territories: France, Spain </li></ul><ul><li>Premium features: </li></ul><ul><li>Zone privieges </li></ul><ul><li>Item privileges </li></ul><ul><li>No combat cap </li></ul><ul><li>PVP </li></ul><ul><li>Pets </li></ul><ul><li>No cap on crafting </li></ul><ul><li>Housing </li></ul>
  25. 25. Prominent Games <ul><li>Game: Runescape </li></ul><ul><li>Genre: Browser-based fantasy MMO (java) </li></ul><ul><li>Developer: Jagex (UK) </li></ul><ul><li>Numbers: 250 000 PCCU; 1 000 000 Subscribers; ARPPU 5 $ </li></ul><ul><li>Key territories: US, UK, Netherlands, Scandinavia </li></ul><ul><li>Premium features: </li></ul><ul><li>Zone privileges </li></ul><ul><li>Item privileges </li></ul><ul><li>Quests privileges </li></ul><ul><li>Extra skills </li></ul><ul><li>Transport privileges </li></ul><ul><li>Dedicated servers </li></ul><ul><li>Dedicated mini games </li></ul><ul><li>Extra Bank space </li></ul><ul><li>Housing </li></ul><ul><li>Extra emotes </li></ul>
  26. 26. Prominent Games <ul><li>Game: Habbo </li></ul><ul><li>Genre: Browser-based teen virtual world (flash) </li></ul><ul><li>Developer: Sulake (Finland) </li></ul><ul><li>Numbers: 10 M active users; ARPU 1.3 $ </li></ul><ul><li>Key territories: Nordic, UK, Germany, France </li></ul><ul><li>MT features: </li></ul><ul><li>Furnitures </li></ul><ul><li>Clothes </li></ul><ul><li>Pets and Pet food </li></ul><ul><li>Mini-games access </li></ul><ul><li>Screenshots </li></ul><ul><li>Home page perks </li></ul>
  27. 27. Prominent Games <ul><li>Game: Metin 2 </li></ul><ul><li>Genre: Client-based Fantasy MMORPG </li></ul><ul><li>Developer: Ymir Entertainment (South Korea) </li></ul><ul><li>Publisher: Gameforge (Germany) </li></ul><ul><li>Numbers: 5 M active users; 35K PCCU; ARPPU 20 € </li></ul><ul><li>Key territories: Germany, Poland, Turkey </li></ul><ul><li>MT features: </li></ul><ul><li>Gameplay buff </li></ul><ul><li>Experience buff </li></ul><ul><li>Gold gain buff </li></ul><ul><li>Repair items </li></ul><ul><li>In Game shop </li></ul><ul><li>Potions </li></ul><ul><li>Trasnports </li></ul><ul><li>Looks </li></ul><ul><li>Gender swap </li></ul>
  28. 28. Building a European Strategy
  29. 29. European Strategy <ul><li>Europe and US </li></ul><ul><li>What is the current US presence? </li></ul><ul><li>What is the current service structure? </li></ul><ul><li>Can the US service (if any) be leveraged? </li></ul><ul><li>Key decision </li></ul><ul><li>Separate US from European service? </li></ul>
  30. 30. European Strategy <ul><li>The Licensing Route </li></ul><ul><li>Finding a partner: </li></ul><ul><ul><li>Reactively (European publishers contacting you) </li></ul></ul><ul><ul><li>Proactively (contacting European publishers) </li></ul></ul><ul><ul><li>Always create options </li></ul></ul>
  31. 31. European Strategy <ul><li>The Licensing Route </li></ul><ul><li>Evaluating the partner: </li></ul><ul><ul><li>Reputation </li></ul></ul><ul><ul><li>Brand management processes </li></ul></ul><ul><ul><li>Game management processes </li></ul></ul><ul><ul><li>Track record </li></ul></ul><ul><ul><li>Financial stability </li></ul></ul>
  32. 32. European Strategy <ul><li>The Licensing Route </li></ul><ul><li>Building the partnership : </li></ul><ul><ul><li>Understand the partner's service </li></ul></ul><ul><ul><li>Create a clear general communication process </li></ul></ul><ul><ul><li>Create a clear escalation process </li></ul></ul><ul><ul><li>Define respective responsabilities </li></ul></ul><ul><ul><li>Allocate ressources </li></ul></ul>
  33. 33. European Strategy <ul><li>The Licensing Route </li></ul><ul><li>Key points to consider: </li></ul><ul><ul><li>Service splitting - required </li></ul></ul><ul><ul><li>Business model </li></ul></ul><ul><ul><li>Royalty mechanism </li></ul></ul><ul><ul><li>IP management </li></ul></ul><ul><ul><li>Localisation strategy </li></ul></ul><ul><ul><li>Bug reporting </li></ul></ul><ul><ul><li>Customer Support policies </li></ul></ul><ul><ul><li>User feedback processes </li></ul></ul><ul><ul><li>Global communication/marketing </li></ul></ul>
  34. 34. European Strategy <ul><li>The Licensing Route </li></ul><ul><li>The values: </li></ul><ul><ul><li>Financial </li></ul></ul><ul><ul><li>Maximise opportunities </li></ul></ul><ul><ul><li>Build a global brand </li></ul></ul>
  35. 35. European Strategy <ul><li>The Publishing Route </li></ul><ul><li>Various ways to achieve it: </li></ul><ul><ul><li>Common US and EU services </li></ul></ul><ul><ul><li>Staged self-publishing effort </li></ul></ul><ul><ul><li>Subsidiary set-up </li></ul></ul>
  36. 36. European Strategy <ul><li>The Publishing Route </li></ul><ul><li>The additional tasks: </li></ul><ul><ul><li>Legal </li></ul></ul><ul><ul><li>Community management </li></ul></ul><ul><ul><li>Localisation </li></ul></ul><ul><ul><li>Customer Support </li></ul></ul><ul><ul><li>Billing solutions </li></ul></ul><ul><ul><li>Server operations </li></ul></ul><ul><ul><li>Marketing </li></ul></ul><ul><ul><li>Distribution (for boxes) </li></ul></ul><ul><ul><li>Recruitment </li></ul></ul>
  37. 37. European Strategy <ul><li>The Publishing Route </li></ul><ul><li>The added value: </li></ul><ul><ul><li>Development of local expertise </li></ul></ul><ul><ul><li>Better ROI </li></ul></ul><ul><ul><li>Brand control and brand development </li></ul></ul><ul><ul><li>Better long-time value and potential in the market </li></ul></ul>
  38. 38. European Strategy <ul><li>The Publishing Route </li></ul><ul><li>Opening a local office: </li></ul><ul><ul><li>Which country? </li></ul></ul><ul><ul><ul><li>Consider VAT, government support, local expertise, cultural background, long-term plans </li></ul></ul></ul><ul><ul><li>Which tasks? </li></ul></ul><ul><ul><ul><li>Clear roles and responsabilities between HQ and local office </li></ul></ul></ul>
  39. 39. European Strategy <ul><li>Pros and Cons </li></ul><ul><li>Licensing </li></ul><ul><ul><li>Simpler and quicker </li></ul></ul><ul><ul><li>Less cashflow sensitive </li></ul></ul><ul><ul><li>Not « plug and play » - still does require a lot work </li></ul></ul><ul><li>Publishing </li></ul><ul><ul><li>Better revenues </li></ul></ul><ul><ul><li>Localisation easier to integrate (at all levels) </li></ul></ul><ul><ul><li>Riskier investment </li></ul></ul>
  40. 40. Questions and Answers
  41. 41. Thank you! Thomas Bidaux www.linkedin.com/in/tbidaux www.icopartners.com/blog [email_address] Slides @ www.slideshare.net/ICOPartners

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