Online Games Market Europe

The Plan Introduction High-level market overview Building a European strategy Q&A Disclaimer: All numbers are estimates

Introduction

High-level market overview

Building a European strategy

Q&A

Disclaimer: All numbers are estimates

Introduction

The Speaker Thomas Bidaux GOA.com (France Telecom) NCsoft Europe (Lineage 2, Guild Wars) ICO Partners Released 7 MMOs in Europe

Thomas Bidaux

GOA.com (France Telecom)

NCsoft Europe (Lineage 2, Guild Wars)

ICO Partners

Released 7 MMOs in Europe

Europe? Herman Moll - 1708

Europe?

Europe?

European Union

Europe in Numbers (1) Superficy 4 300 000 km² China – 9 640 000 km 2 Population 500M in Europe USA - 300M Density 114/km² Korea - 493/km²

Superficy

4 300 000 km²

China – 9 640 000 km 2

Population

500M in Europe

USA - 300M

Density

114/km²

Korea - 493/km²

Europe in Numbers (2) Internet Users Consoles 11.2M PS3 (46% ww) 12.4M Xbox 360 (39% ww) 20M Wii (38% ww)

Internet Users

Consoles

11.2M PS3 (46% ww)

12.4M Xbox 360 (39% ww)

20M Wii (38% ww)

Market overview

European Market Size of the Internet market Broadband lines per 100 inhabitants. 2008

Size of the Internet market

European Market Popular Online Games

Popular Online Games

European Market Size of the Market WOW Servers

Size of the Market

European Market F2P vs P2P

F2P vs P2P

European Market F2P vs P2P (from 400+ games currently operated in Europe or under development)

F2P vs P2P

European Market Free to Play Market Driven by browser-based Some succesful client-based Free to Play EU Estimates

Free to Play Market

Driven by browser-based

Some succesful client-based Free to Play

EU Estimates

Estimated market size: 30M+ F2P online games players in Europe 400+ games Estimated revenue : 400-500M€/year European F2P Market

European Devs Online Games Studios 173 studios 300+ projects Compared to US : Less VC-backed Less video games background Successful bootstrapped web studios/hobby projects

Online Games Studios

173 studios

300+ projects

Compared to US :

Less VC-backed

Less video games background

Successful bootstrapped web studios/hobby projects

European Devs Prominent Studios

Prominent Studios

European Operators Local subsiduaries Blizzard – WOW NCWest– GW, Lineage 2, City of Heroes Club Penguin – Club Penguin Gala Net – Flyff, Rappelz Aeria Games – Last Chaos, Shaiya, Megaten Nexon – MapleStory, Combat Arms SquareEnix – FFXI Ndoors – Atlantica Online NHN – Karos Online

Local subsiduaries

Blizzard – WOW

NCWest– GW, Lineage 2, City of Heroes

Club Penguin – Club Penguin

Gala Net – Flyff, Rappelz

Aeria Games – Last Chaos, Shaiya, Megaten

Nexon – MapleStory, Combat Arms

SquareEnix – FFXI

Ndoors – Atlantica Online

NHN – Karos Online

European Operators Local actors Codemasters – Lotro, DDO, Jumpgate GOA.com – DAoC, WAR, Goa.com Frogster – Runes of Magic, Bounty Bay Online Gameforge – Metin 2, Ogame Bigpoint – Seafight, Dark Orbit Gamigo – Level R, Last Chaos, Shot Online Burda IC – Florensia, Ragnarok, Alaplaya Games Masters – Cabal Online, Perfect World MAYN – 12Sky2 Rourke – Priston Tale 2, YS Online Gametribe – DOMO, Dekaron, Infinity, Kicks Online Playmedia – ASDA Story

Local actors

Codemasters – Lotro, DDO, Jumpgate

GOA.com – DAoC, WAR, Goa.com

Frogster – Runes of Magic, Bounty Bay Online

Gameforge – Metin 2, Ogame

Bigpoint – Seafight, Dark Orbit

Gamigo – Level R, Last Chaos, Shot Online

Burda IC – Florensia, Ragnarok, Alaplaya

Games Masters – Cabal Online, Perfect World

MAYN – 12Sky2

Rourke – Priston Tale 2, YS Online

Gametribe – DOMO, Dekaron, Infinity, Kicks Online

Playmedia – ASDA Story

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

Prominent Games Game: Dofus Genre: Fantasy MMO (Flash/java) Developer: Ankama (France) Numbers: 170 000 PCCU; 500 000 Subscribers; 3M active - ARPPU 5 € Key territories: France, Spain Premium features: Zone privieges Item privileges No combat cap PVP Pets No cap on crafting Housing

Game: Dofus

Genre: Fantasy MMO (Flash/java)

Developer: Ankama (France)

Numbers: 170 000 PCCU; 500 000 Subscribers; 3M active - ARPPU 5 €

Key territories: France, Spain

Premium features:

Zone privieges

Item privileges

No combat cap

PVP

Pets

No cap on crafting

Housing

Prominent Games Game: Runescape Genre: Browser-based fantasy MMO (java) Developer: Jagex (UK) Numbers: 250 000 PCCU; 1 000 000 Subscribers; ARPPU 5 $ Key territories: US, UK, Netherlands, Scandinavia Premium features: Zone privileges Item privileges Quests privileges Extra skills Transport privileges Dedicated servers Dedicated mini games Extra Bank space Housing Extra emotes

Game: Runescape

Genre: Browser-based fantasy MMO (java)

Developer: Jagex (UK)

Numbers: 250 000 PCCU; 1 000 000 Subscribers; ARPPU 5 $

Key territories: US, UK, Netherlands, Scandinavia

Premium features:

Zone privileges

Item privileges

Quests privileges

Extra skills

Transport privileges

Dedicated servers

Dedicated mini games

Extra Bank space

Housing

Extra emotes

Prominent Games Game: Habbo Genre: Browser-based teen virtual world (flash) Developer: Sulake (Finland) Numbers: 10 M active users; ARPU 1.3 $ Key territories: Nordic, UK, Germany, France MT features: Furnitures Clothes Pets and Pet food Mini-games access Screenshots Home page perks

Game: Habbo

Genre: Browser-based teen virtual world (flash)

Developer: Sulake (Finland)

Numbers: 10 M active users; ARPU 1.3 $

Key territories: Nordic, UK, Germany, France

MT features:

Furnitures

Clothes

Pets and Pet food

Mini-games access

Screenshots

Home page perks

Prominent Games Game: Metin 2 Genre: Client-based Fantasy MMORPG Developer: Ymir Entertainment (South Korea) Publisher: Gameforge (Germany) Numbers: 5 M active users; 35K PCCU; ARPPU 20 € Key territories: Germany, Poland, Turkey MT features: Gameplay buff Experience buff Gold gain buff Repair items In Game shop Potions Trasnports Looks Gender swap

Game: Metin 2

Genre: Client-based Fantasy MMORPG

Developer: Ymir Entertainment (South Korea)

Publisher: Gameforge (Germany)

Numbers: 5 M active users; 35K PCCU; ARPPU 20 €

Key territories: Germany, Poland, Turkey

MT features:

Gameplay buff

Experience buff

Gold gain buff

Repair items

In Game shop

Potions

Trasnports

Looks

Gender swap

Building a European Strategy

European Strategy Europe and US What is the current US presence? What is the current service structure? Can the US service (if any) be leveraged? Key decision Separate US from European service?

Europe and US

What is the current US presence?

What is the current service structure?

Can the US service (if any) be leveraged?

Key decision

Separate US from European service?

European Strategy The Licensing Route Finding a partner: Reactively (European publishers contacting you) Proactively (contacting European publishers) Always create options

The Licensing Route

Finding a partner:

Reactively (European publishers contacting you)

Proactively (contacting European publishers)

Always create options

European Strategy The Licensing Route Evaluating the partner: Reputation Brand management processes Game management processes Track record Financial stability

The Licensing Route

Evaluating the partner:

Reputation

Brand management processes

Game management processes

Track record

Financial stability

European Strategy The Licensing Route Building the partnership : Understand the partner's service Create a clear general communication process Create a clear escalation process Define respective responsabilities Allocate ressources

The Licensing Route

Building the partnership :

Understand the partner's service

Create a clear general communication process

Create a clear escalation process

Define respective responsabilities

Allocate ressources

European Strategy The Licensing Route Key points to consider: Service splitting - required Business model Royalty mechanism IP management Localisation strategy Bug reporting Customer Support policies User feedback processes Global communication/marketing

The Licensing Route

Key points to consider:

Service splitting - required

Business model

Royalty mechanism

IP management

Localisation strategy

Bug reporting

Customer Support policies

User feedback processes

Global communication/marketing

European Strategy The Licensing Route The values: Financial Maximise opportunities Build a global brand

The Licensing Route

The values:

Financial

Maximise opportunities

Build a global brand

European Strategy The Publishing Route Various ways to achieve it: Common US and EU services Staged self-publishing effort Subsidiary set-up

The Publishing Route

Various ways to achieve it:

Common US and EU services

Staged self-publishing effort

Subsidiary set-up

European Strategy The Publishing Route The additional tasks: Legal Community management Localisation Customer Support Billing solutions Server operations Marketing Distribution (for boxes) Recruitment

The Publishing Route

The additional tasks:

Legal

Community management

Localisation

Customer Support

Billing solutions

Server operations

Marketing

Distribution (for boxes)

Recruitment

European Strategy The Publishing Route The added value: Development of local expertise Better ROI Brand control and brand development Better long-time value and potential in the market

The Publishing Route

The added value:

Development of local expertise

Better ROI

Brand control and brand development

Better long-time value and potential in the market

European Strategy The Publishing Route Opening a local office: Which country? Consider VAT, government support, local expertise, cultural background, long-term plans Which tasks? Clear roles and responsabilities between HQ and local office

The Publishing Route

Opening a local office:

Which country?

Consider VAT, government support, local expertise, cultural background, long-term plans

Which tasks?

Clear roles and responsabilities between HQ and local office

European Strategy Pros and Cons Licensing Simpler and quicker Less cashflow sensitive Not « plug and play » - still does require a lot work Publishing Better revenues Localisation easier to integrate (at all levels) Riskier investment

Pros and Cons

Licensing

Simpler and quicker

Less cashflow sensitive

Not « plug and play » - still does require a lot work

Publishing

Better revenues

Localisation easier to integrate (at all levels)

Riskier investment

Questions and Answers

Thank you! Thomas Bidaux www.linkedin.com/in/tbidaux www.icopartners.com/blog [email_address] Slides @ www.slideshare.net/ICOPartners