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Game Business Overview Talk - A Presentation at the MSeed Accelerator Program

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A small invited talk session given at the MSeed Accelerator Program. A quick overview of the Thai Game Industry was given before going into little tids and bits about the Game Industry that would be …

A small invited talk session given at the MSeed Accelerator Program. A quick overview of the Thai Game Industry was given before going into little tids and bits about the Game Industry that would be interesting ranging from the Targeting Segments, App Stores, to Survival Guides based on aggregate ideas from many sources.

This talk is geared towards newer game developers just breaking into the business.


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  • Aggregate at 31.56M or 978.36M THB 1.84 M App Store 0.79 M GooglePlay
  • Transcript

    • 1. Game Business Orientation Pisal Setthawong Presentation for June 23, 2014
    • 2. Outline of Talk 1/3 • About the Speaker • Why Games? • Overview of the Game Industry in Thailand – Timeline – Actors/Stakeholders in Thailand – Game Market – Future Opportunities Pisal Setthawong (2014) 2
    • 3. Outline of Talk 2/3 • Game Business Overview – Fundamentals/Product Life Cycle – Classification of the Game Market • Game Player Demographics • Ambiguity in Classification • Looking In Between the Lines – Current Install Base – App Store and Other Digital Store Fundamentals • App Store • A Look at Freemium • Publishers Pisal Setthawong (2014) 3
    • 4. Outline of Talk 3/3 • Let’s Guess the Future! • Game Developer Survival Tips • Q&A/Discussions Pisal Setthawong (2014) 4
    • 5. About the Speaker Pisal Setthawong • Award Winning and Early Pioneer in the Thai Game Industry • Committees at various Game Events /Organizations • Developer Community Volunteer/Organizer • Well-travelled Game Educator Pisal Setthawong (2014) 5
    • 6. GAMES are probably the most Important form of Digital Media Pisal Setthawong (2014) 6
    • 7. Global Game Market Value Pisal Setthawong (2014) 7 RW Baird and Co - 2012
    • 8. Global Games Market (Region) Pisal Setthawong (2014) 8
    • 9. Pisal Setthawong (2014) 9
    • 10. TIMELINE Overview of the Game Industry in Thailand Maturity Trials Early Pisal Setthawong (2014) 10
    • 11. Pisal Setthawong (2014) 11
    • 12. Major Period Classifications in the Thai Game Development Industry (1/2) PC • Start of Industry • 2000 PC Mobile PDA • Rise of Mobile • 2002-2005 ??? • Mobile Market Crash • 2005 Maturity Trials Early Pisal Setthawong (2014) 12
    • 13. Major Period Classifications in the Thai Game Industry (2/2) MMOG Console PC Casual • Transition Phase • 2005-2008 FB Mobile • The Rise of Facebook and the App Store • 2009-2011 • Increasing Maturity • 2011-Present Maturity Trials Early Pisal Setthawong (2014) 13
    • 14. View the Timeline • View the timeline at: http://www.tiki-toki.com/ timeline/imagemode/291692/ Thai-Game-Industry-Timeline/ http://tinyurl.com/pnz3wn6 Maturity Trials Early Pisal Setthawong (2014) 14
    • 15. ACTORS/STAKEHOLDERS Overview of the Game Industry in Thailand Pisal Setthawong (2014) 15
    • 16. Actors/Stakeholders Pisal Setthawong (2014) 16
    • 17. Developers (Overview) • Industry started in 2000 • Virtually all of the Early Game Development Studios were self-funded • Huge Expansion during 2011-Present – Open Publishing Platforms – Lower Cost of Entry – Seed Funding/Incubators/Investors – Foreign Investment – Increased Acceptance by Society • Most Studios are small in size (less than 10 people) focused on creating original IPs on Mobile Platform Pisal Setthawong (2014) 17
    • 18. Developers • Industry started in 2000 • Virtually all of the Early Game Development Studios were self-funded • Huge Expansion during 2011-Present – Open Publishing Platforms – Lower Cost of Entry – Seed Funding/Incubators/Investors – Foreign Investment – Expanding Game Market – Increased Acceptance by Society Pisal Setthawong (2014) 18
    • 19. Developers • Currently most Studios are small in size (less than 10 people) and focused on creating original IPs on Mobile Platform • Different Developers have different focus, leading to products on different platforms and services provided • Strong entrepreneur spirit, more experienced developers have a tendency to start their own company Pisal Setthawong (2014) 19
    • 20. Developers • Thai Developer have a good record in developing hits and original IPs over the years – Juice Cubes – Unblock Me – Candy Meleon – Jigsaw Mansion – Glow Hockey – Etc. Pisal Setthawong (2014) 20
    • 21. Publishers • Traditionally focus on MMOGs – Ragnarok Online was first major hit – Influx of imported games (mainly Korean) • Some Local Publishers Publish Local Developed MMOGs Games Pisal Setthawong (2014) 21
    • 22. Publishers • Currently publishers are entering the Mobile Publishing sphere – Many different publishing models are offered • Microinvestment in Projects – Some Provide Development/Publishing Platforms – Publishing process, guidelines, best practices are still being ironed out • Potential for increasing collaboration with local developers Pisal Setthawong (2014) 22
    • 23. Investors • Investment in the game development sector is minimal until about 2010 (Coincide with Global Game/Startup Culture Boom) • Foreign and Local Investments in Game Development Studios is becoming common Pisal Setthawong (2014) 23
    • 24. Investors • Local Publishers/Investors/Banks have improved perception of the Game Industry • Investment from Thai investors comes in many flavors: – Seed Funding – Support Funding – Investment – Grants – Competition Grants Pisal Setthawong (2014) 24
    • 25. Government • ICT Ministry and SIPA supports Thai Game Development – Thailand Ministry of ICT Awards with Categories in Entertainment – Periodical Contests for Seed Funding – Funding to join Overseas Events (e.g. Games Connection, GDC, Tokyo Game Show, etc.) – Business Matching Events – Funding for Trade Association Events • Other Notable Agencies – DEP (Department of Export Promotion), Software Park, TK Park • Board of Investment (BOI) Incentives available Pisal Setthawong (2014) 25
    • 26. Associations Game & Interactive Digital Entertainment Association Thai Game Software Industry Association Thai Digital Entertainment Content Federation Thai Animation and Computer Graphic Association Software Association of Thailand Pisal Setthawong (2014) 26
    • 27. Developer Community • TGDC is the Largest Thai Game Developer Community (on FB) • https://www.facebook.com/groups/thaigamepad • Most discussions in the Local Game Developer Community are done in Thai • However, most developers are Bilingual (Thai/English) Pisal Setthawong (2014) 27
    • 28. Academic • Most Major Universities offer Major/Minor in Game Development • Game Developers/Association have contacts with many Universities • Challenges – Effectiveness hampered by University Regulations – Coursework needs realignment with Industry Needs – Potential for too much dependency on Tools – Student Attitudes Pisal Setthawong (2014) 28
    • 29. Media • Traditional Strong in Print Media • Online Media surpassing Print Media in Popularity • Word of Mouth via social network is an important Media • E-Sports is increasing in popularity • G-Square is Thailand’s dedicated gaming channel (Sadly Closed 2013) Pisal Setthawong (2014) 29
    • 30. GAME MARKET Overview of the Game Industry in Thailand Pisal Setthawong (2014) 30
    • 31. Quick Statistics • Population: 65,479,453 (2010 Census) • Major Language: Thai • Major Consumer of Media, Games, and Mobile Pisal Setthawong (2014) 31
    • 32. Quick Statistics Pisal Setthawong (2014) 32 Niko Research - 2012
    • 33. Thailand Mobile Overview Post-Paid 6,481,372 7,050,943 7,256,473 7,938,934 9,782,683 10,740,629 Pre-Paid 55,355,792 58,901,370 64,469,827 69,510,532 75,229,728 79,244,232 Total 61,837,164 65,952,313 71,726,300 77,449,466 85,012,411 89,984,861 0 10,000,000 20,000,000 30,000,000 40,000,000 50,000,000 60,000,000 70,000,000 80,000,000 90,000,000 100,000,000 2008 2009 2010 2011 2012 2013 NBTC, Thailand, June 25, 2013 Mobile Penetration (131%) (2013 Q2) 85% of Mobile Phones Sold in 2013 are Smart Phones GfK Retail and Technology Asia 2013 Pisal Setthawong (2014) 33
    • 34. Thailand Internet Usage Overview • 60% of Mobile Users Access Internet through Mobile Device • 72% of People Under 24 have access to the Internet • Out of ~22 mil households, only about 1 mil household have wired Internet – Internet Cafes traditionally provide Internet connectivity to the masses but decreasing in significance due to mobile Internet connectivity National Statistic Office 2012 Pisal Setthawong (2014) 34
    • 35. Thailand App Market Analysis App Annie Intelligence - Jul 2013 Pisal Setthawong © 2014 35 Revenue 2M USD 1M USD 3M USD Download 25M 50M 75M ARPDL ~0.09 USD ~0.02 USD ~0.04 USD Monthly Statistics of Thailand App Market (July 2013) ARPDL - Average Revenue Per Download Top 400 Games 92% of Google Play’s revenue 79% for Apple’s App Store Distimo - Sept 2013
    • 36. Thai Gamer Quirks • Typically avoid paying for Premium games • Less resistant to paying Games as a Service • High tendency of migration between F2P games • Female Gamers usually pay than Male Gamers • Vibrant Item Auction Community • Mobile is the gaming device of choice Pisal Setthawong (2014) 36
    • 37. Thai Gamer Quirks • Social Media is very popular – Line (22 Million Accts) 1 – FB (18 Million Accts) 2 • Social Media Users are also heavy consumers of digital media and games Pisal Setthawong (2014) 37 1. Line 2014 2. Zocial Inc 2013
    • 38. FUTURE OPPORTUNITIES AND CHALLENGES OF THE INDUSTRY Overview of the Game Industry in Thailand Pisal Setthawong (2014) 38
    • 39. Opportunities • The Whole ecosystem in Thailand is Now Finally Complete – Support from all relevant agencies and units can help push forward the Industry • Increased investment both local and abroad • Increasing maturity of the academic sector in the production of personnel to the market • Increasing experience of newly founded Game Development Studios • Thais are known to be very creative and artistic Pisal Setthawong (2014) 39
    • 40. Challenges • Local Investors and Publishers are relatively new to the Mobile Ecosystem • Thai personnel can be very individualized • Academic may not be supplying the right type of developer to the gaming industry • Making the local market more sustainable for a wider genre/platforms by changing consumer attitudes • Increasing Cost Pisal Setthawong (2014) 40
    • 41. GAME BUSINESS OVERVIEW Fundamentals/Product Life Cycle Pisal Setthawong (2014) 41
    • 42. Life is the most Difficult EXAM Pisal Setthawong (2014) 42
    • 43. Product Lifecycle Pisal Setthawong (2014) 43
    • 44. Product Lifecycle - Extension Strategy Pisal Setthawong (2014) 44
    • 45. Peaks Pisal Setthawong (2014) 45 2012
    • 46. Follow the Money Trail Pisal Setthawong (2014) 46
    • 47. Red Ocean/Blue Ocean Pisal Setthawong (2014) 47 or ?
    • 48. GAME BUSINESS OVERVIEW Classification of the Game Market Pisal Setthawong (2014) 48
    • 49. In-Between the Lines? Pisal Setthawong (2014) 49
    • 50. In-Between the Lines? Pisal Setthawong (2014) 50
    • 51. GAME BUSINESS OVERVIEW Game Player Demographics Pisal Setthawong (2014) 51
    • 52. Game Controllers as a Guide Pisal Setthawong (2014) 52 Hardcore Gamer Casual Gamer
    • 53. Global Demographics Age Group Male Ratio Tally Ratio 0-9 646,550,548 9.01% Male 3,613,262,318 50.35% 10-19 616,990,606 8.60% Female 3,562,760,737 49.65% 20-29 604,531,452 8.42% Total 7,176,023,055 100% 30-39 522,738,915 7.28% 40-49 468,630,544 6.53% 50-59 353,658,579 4.93% 60+ 400,161,674 5.58% Age Group Female Ratio 0-9 604,935,074 8.43% 10-19 576,088,296 8.03% 20-29 576,824,052 8.04% 30-39 507,294,288 7.07% 40-49 461,051,859 6.42% 50-59 362,431,963 5.05% 60+ 474,135,205 6.61% Pisal Setthawong (2014) 53 US World Census 2014
    • 54. The Hard Core Gamer Hardcore Gamer 15% Remaining 85% Potential Hardcore Gamers Pisal Setthawong (2014) 54 Male (18-35)
    • 55. Casual Gamer v1 The Soccer Mom Pisal Setthawong (2014) 55 17% 83% Potential Soccer Mom Demographics SoccerMom Remaining Female (35-65) Soccer Mom Remaining
    • 56. The Mobile Generation Pisal Setthawong (2014) 56 58% 42% Potential Mobile Generation Demographics Mobile Generation Remaining Male/Female (20-65) Mobile Generation Remaining NOT MUTUALLY EXCLUSIVE WITH
    • 57. World Internet Users WORLD INTERNET USAGE AND POPULATION STATISTICS June 30, 2012 World Regions Population ( 2012 Est.) Internet Users Dec. 31, 2000 Internet Users Latest Data Penetration (% Population) Growth 2000-2012 Users % of Table Africa 1,073,380,925 4,514,400 167,335,676 15.6 % 3,606.7 % 7.0 % Asia 3,922,066,987 114,304,000 1,076,681,059 27.5 % 841.9 % 44.8 % Europe 820,918,446 105,096,093 518,512,109 63.2 % 393.4 % 21.5 % Middle East 223,608,203 3,284,800 90,000,455 40.2 % 2,639.9 % 3.7 % North America 348,280,154 108,096,800 273,785,413 78.6 % 153.3 % 11.4 % Latin America / Caribbean 593,688,638 18,068,919 254,915,745 42.9 % 1,310.8 % 10.6 % Oceania / Australia 35,903,569 7,620,480 24,287,919 67.6 % 218.7 % 1.0 % WORLD TOTAL 7,017,846,922 360,985,492 2,405,518,376 34.3 % 566.4 % 100.0 Pisal Setthawong (2014) 57 Internet World Stats 2013
    • 58. World Internet Penetration Rates Pisal Setthawong (2014) 58
    • 59. GAME BUSINESS OVERVIEW Ambiguity in Classification Pisal Setthawong (2014) 59
    • 60. Ambiguity in Classification Pisal Setthawong (2014) 60 GENRE PLATFORM or SCREEN TYPE?
    • 61. Segmentation of Gaming Devices Pisal Setthawong (2014) 61 Mobile Home
    • 62. Ambiguity in Classification Pisal Setthawong (2014) 62 Migration Potential Migration??? Competing OVER LAPPING GENRE in Every Platform!!! Phablet?Linux?
    • 63. Drilling Down Pisal Setthawong (2014) 63 AAA MMOG ETC. Casual Niche/Indie [%?] [%?] [%?] [%?] [%?] Puzzle One Click CardEtc. Puzzle Hidden Object [%?] [%?] [%?][%?] [%?] [%?] Platform Drilling Down to Genre Genre Drilling Down to Sub Genre
    • 64. Game Types by Age and Gender Pisal Setthawong (2014) 64
    • 65. Game Type by Usage and Retention Pisal Setthawong (2014) 65
    • 66. Global Games Market (Region) Pisal Setthawong (2014) 66
    • 67. Global Games Market (Region) v2 Pisal Setthawong (2014) 67
    • 68. Region/Country Specific Tastes Pisal Setthawong (2014) 68 Western Eastern
    • 69. App Intelligence and Analytics Pisal Setthawong (2014) 69
    • 70. Targeting the Wrong Segment? Pisal Setthawong (2014) 70
    • 71. GAME BUSINESS OVERVIEW Current Install Base Pisal Setthawong (2014) 71
    • 72. Smart Phone Install Base Pisal Setthawong (2014) 72 RW Baird and Co - 2013
    • 73. Tablet Installed Base Pisal Setthawong (2014) 73 RW Baird and Co - 2013
    • 74. Tablet Ownership Pisal Setthawong (2014) 74 RW Baird and Co - 2012
    • 75. PC Install Base Pisal Setthawong (2014) 75 Strategic Investment Report 2014
    • 76. Console Install Base Mobile Console Home Console Microsoft 0 83.7 Nintendo 153.99 101.06 Sony 80 80 0 50 100 150 200 250 300 InstallBaseInMillions Last Generation Console Install Base (DS) (PSP) (PS3) (XBOX360) (WII) Pisal Setthawong (2014) 76 Aggregate Data 2014
    • 77. Smart TV Install Base Pisal Setthawong (2014) 77 Smart TV 33% Normal TV 67% • Rise of New Platform • 76 million units in 2013 (33% of Total Sales) • Internet Connectivity to All Mid-High End TV by 2017 (73% of total TV sales) • Continuous Growth (55% in 2013 and increasing) Global TV Sales in 2013 Normal 152 Smart TV 76 0 50 100 150 200 250 SalesinMillions Global TV Sales 2013 M M Strategic Investment Report 2014
    • 78. Cloud Gaming? Pisal Setthawong (2014) 78 Private Beta - US 2014
    • 79. Volume = Value? Pisal Setthawong (2014) 792012
    • 80. GAME BUSINESS OVERVIEW App Store and Other Digital Store Fundamentals Pisal Setthawong (2014) 80
    • 81. App Store Overview Pisal Setthawong (2014) 81Forbes Magazine 2013
    • 82. Revenue Pisal Setthawong (2014) 82 Vision Mobile 2013
    • 83. Distribution of Income in App Store Pisal Setthawong (2014) 83 Dabble 2012
    • 84. Developer Mindshare Pisal Setthawong (2014) 84 Vision Mobile 2013
    • 85. App Store Pisal Setthawong (2014) 85
    • 86. Discovery / Attractiveness Pisal Setthawong (2014) 86 Discoverability Attractiveness Top Charts Customer Ratings Customer Also Bought Customer Comments Apple - New and Noteworthy - Staff Pick’s - What’s Hot - Apple Feature In-Store Appearance - Icons -Screenshots - Description Cross Promotion Number of Ratings/Comments Free Apps/Discounts Regular Updates Ad Networks Popular Developer
    • 87. App Store Mentality Pisal Setthawong (2014) 87
    • 88. Buying Apps Pisal Setthawong (2014) 88
    • 89. Price of Apps Pisal Setthawong (2014) 89 Flurry - 2013
    • 90. Freemium vs Premium Pisal Setthawong (2014) 90 Distimo 2013 Distimo - Jan-Nov 2013
    • 91. Free Content • “Generally people want free content more than they want to avoid ads or to pay for the absolute highest quality content possible" - Flurry Pisal Setthawong (2014) 91
    • 92. Freemium Fundamentals • Choose the right market • Distinguish between free and paid content in a way users care about • Track the metrics that matter • Create clear “paths” for promising prospects • Free is no longer a differentiating strategy Pisal Setthawong (2014) 92
    • 93. Looking at Freemium Consumers • Only 1.5% of total install made in-app purchase within a month • 50% of revenue is derived from the top 10% of those players who do make purchases (0.15%) • 49% of all payers make only a single purchase per calendar month • Only 13% of paying players make five or more purchases • The average time to first purchase is just under 24 hours • For second purchase, the average time lapse between first and second purchase is a mere 1 hour 40 minutes • 53% of players who make a purchase go on to make a repeat purchase within 14 days, while 47% do not. • 13.7% of new players accrue more than four purchases in their first 14 days. • Of revenue accrued within the first 14 days of a player’s life, over 60% is accrued on the first day of life. • The average value of an in-app purchase is $5.94 • Purchases between $1 and $5 (67%) contribute only 27% of total revenues • Purchases of over $50 consist of 0.7% of all purchases and contribute 9% of all revenues • Is this sustainable? Pisal Setthawong (2014) 93 Swerve 2014
    • 94. PR and Reviews • The Typical User – does not buy apps from PR and Reviews – rely on Information from the App Storefront • Mobile Sales are not usually impacted by Good Review in External Media Sites • Mobile Review Sites May Charge to Review your Games Pisal Setthawong (2014) 94
    • 95. Case Study Pisal Setthawong (2014) 95
    • 96. Targeting Niche (Hardcore Indie) • Find a Niche • Build Communities • Build a Track Record • Market Specifically to Target Audience • Tailor Distribution Method • Target Specific Niches Neglected by Mainstream Developers Pisal Setthawong (2014) 96
    • 97. Targeting Niche (Mobile) • The download market on Mobile is larger, but it is chart-based • Difficult to get Niche games to Top Chart to drive sales!!! Pisal Setthawong (2014) 97
    • 98. Publishers Pros (In Theory) • Skilled Producers • Knowledge of the Market • Detailed Metrics • Media Contacts /Advertising • Distribution Channels • Contacts • Potential Funding Cons • Revenue Share with Digital Distributor + Publisher • Additional Work/Investment Required • One of Many Games, not Likely to be main focus of Publisher Pisal Setthawong (2014) 98
    • 99. Self Publishing Pisal Setthawong (2014) 99
    • 100. GAME BUSINESS OVERVIEW Let’s Guess the Future! Pisal Setthawong (2014) 100
    • 101. Mobile is King Pisal Setthawong (2014) 101
    • 102. Maturity of Tablets as Gaming Devices Pisal Setthawong (2014) 102
    • 103. Smart TV the Future? Pisal Setthawong (2014) 103
    • 104. Mid Core Games Segment Widening Pisal Setthawong (2014) 104
    • 105. Hard Core Games will Not Die! Pisal Setthawong (2014) 105
    • 106. Cloud Based Gaming Services? Pisal Setthawong (2014) 106
    • 107. Cloud Gaming Impacting Traditional Platforms? Pisal Setthawong (2014) 107 ???
    • 108. Subscription Model? Pisal Setthawong (2014) 108
    • 109. F2P Backlash? Pisal Setthawong (2014) 109 F2P
    • 110. Gambling Apps Pisal Setthawong (2014) 110
    • 111. GAME DEVELOPER SURVIVAL TIPS Pisal Setthawong (2014) 111
    • 112. What is Your Motivation? • Get Rich? • For Self-Ego? • Being Ordered? • For Fun? • For the Challenge? • For My Boss? Pisal Setthawong (2014) 112 Know Yourself Before Starting!!
    • 113. Find Funding Pisal Setthawong (2014) 113 Self Funded? Investor? Publisher? Crowd Sourcing?
    • 114. Pick the Right Fight Pisal Setthawong (2014) 114
    • 115. Lesson of AAAAAA • Ambition • Absolutely No Idea What I Was Doing • All Those Graphics • Aging • Always Sticking to the Plan • Albatross Pisal Setthawong (2014) 115 Adam Butcher http://www.youtube.com/watch?v=2b0tSu0QDQ0
    • 116. Save Money on Things that Don’t Count Pisal Setthawong (2014) 116
    • 117. Fancy Office? How about No? Pisal Setthawong (2014) 117
    • 118. Virtual Office Pisal Setthawong (2014) 118
    • 119. Underestimating Production Cost? Pisal Setthawong (2014) 119 Perceived Cost Actual Cost
    • 120. Time Between Investment and Income? Pisal Setthawong (2014) 120 Production starts Game submitted to Nintendo Game approved by Nintendo Game on sale 1st royalty payment May 10 Jun 10 Jul 10 Aug 10 Sep 10 Oct 10 Nov 10 Dec 10 Jan 11 Feb 11 Mar 11 Apr 11 May 11 Jun 11 Jul 11 Aug 11 Sep 11 Oct 11 18 months! 1st threshold reached Case Study - “Spot The Differences!” on Wii – Sanuk Games
    • 121. Overestimating Your Income Pisal Setthawong (2014) 121 INCOME EXPENSES
    • 122. Accounting/Budgeting Pisal Setthawong (2014) 122
    • 123. Plan How to Monetize Your Games! Pisal Setthawong (2014) 123
    • 124. Keep Going! Pisal Setthawong (2014) 124
    • 125. Meet People Pisal Setthawong (2014) 125
    • 126. Attend Game Developer Meetings Pisal Setthawong (2014) 126 Indie Game Developers and Development Meetup Group [http://www.meetup.com/Indie-game-developers-and-development/]
    • 127. Keep Contact with Schools Pisal Setthawong (2014) 127
    • 128. Join Industry Contests Pisal Setthawong (2014) 128
    • 129. Enjoy What You Are Doing! Pisal Setthawong (2014) 129 FAILURE OR NEW IDEA/GOAL
    • 130. Q&A AND ADDITIONAL DISCUSSION Pisal Setthawong (2014) 130 Yes! No! Ok!
    • 131. Thank You! • For additional queries, feel free to drop me an e-mail at: pisal@pigsssgames.com • I can also be contacted via my personal page at FB: https://www.facebook.com/pisal.setthawong • Discuss with us at TGDC: https://www.facebook.com/groups/thaigamepad/ Pisal Setthawong © 2014 131