Insights about the German Market by Andreas Lober, Lawyer & Partner at Brower Games Forum
Insights about the German market:Hangover after the Party?Paris, June 19 2013Dr Andreas LoberRechtsanwalt / maîtrise en droit (Aix-en-Provence)
2Overview1. Introduction2. The Party3. The Hangover4. Outlook1 432
31. Introduction2. The PartyThe Party3. The HangoverThe Hangover4. OutlookOutlook1 432
4IntroductionAbout me:• Freelance gaming journalist (since 1991)• Studied law in Tübingen and Aix-en-Provence• Lawyer (since 2001), counsel to many computer games publishers• Founder of browser games conference / bgf (2005)The views expressed in this lecture are purely personal.The information presented in taken from public sources (not my files).
6Introduction2010: Bigpoint’s 100 million players party
7Introduction2013:• Gameforge closes Berlin office• Travian announces redundancies… what happened in between?
81. IntroductionIntroduction2. The Party3. The HangoverThe Hangover4. OutlookOutlook1 432
9The PartyA short history of browser-based games (I)1995: SOL – first browser-based game with players interacting in a persistent world(developed in Hamburg)1999: Runescape – early version2000: Planetarion – inspiration for Galaxy Wars and OGame2001: Galaxy Wars – first major German browser-based game, later acquired by Gameforge… in 2001, Germany was a nation of game players, not of game developers!2002: OGame – the game that made Gameforge a major player2004: Travian – a major move towards graphics2004: Runescape – modern version released
10The PartyA short history of browser-based games (II)2005: Seafight – real-time gameplay2006: Dark Orbit – Seafight taken to a space setting2010: Settlers Online – Ubisoft entering the market… in 2010, German browser-based game developers think that only the sky is the limit.2011: Drakensang Online – Bigpoint successfully building on an existing brand
11The PartyCommercial milestones:2006: Gameforge acquires French studio Nevrax out of insolvency (The Saga of Ryzom)2007: Accel Partners acquires minority stake in Gameforge2008: NBC and GMT together acquired 70 percent of Bigpoint (valuation USD 102m)2009: Bot software declared illegal by Hamburg court2010: Bigpoint acquires Radon Labs out of insolvency (Drakensang)2010: Bigpoint celebrates 100m registered players2010: Gameforge acquires majority stake in Frogster (Runes of Magic)2010: bgf keynote Prof Richard Bartle: “Garden of Unearthly Delights” – the creator of the first MMOG(“MUD”) says that the glory days are over, unless the industry changes2011: TA Associates and Summit Partners acquire majority stake in Bigpoint at USD 350m (valuationUSD 600m)2012: Travian acquires Bright Future (EA Sports Fussball Manager)
121. IntroductionIntroduction2. The PartyThe Party3. The Hangover4. OutlookOutlook1 432
13The Hangover2008: Gameforge France goes into insolvency2011: Gameforge announces redundancies2012: Bigpoint announces redundancies2013: Travian announces redundancies2013: Gameforge annouces shutting down of Berlin office
18The Hangover• Entry of majors does not seem to hit the browser-based games companies badly• Interest in games declined, but this has always been the case• However:• Viral marketing does not work anymore (is “pay to win” to blame?)• User acquisition costs exploded (too many games, too many companies, too many ofthem with too much money to burn)• Not enough new “hit games”• Companies were geared towards quick growth, not to a market going sideways
191. IntroductionIntroduction2. The PartyThe Party3. The HangoverThe Hangover4. Outlook1 432
20Outlook• Browser-based companies are still very strong and have a huge userbase• 50%+ margin will no longer be realistic• The party can go on, but ...• They need a mobile strategy• They need a brand strategy to promote and to monetize (cf. Settlers, Angry Birds)• They need a product strategy– Browser-based games once filled a niche (complex, non-synchronized strategy games)– Then, they were the driving force for f2p – now f2p is everywhere, no longer a USP– Developers will have to see what makes sense to do in the browser (and where a browser-based game just cannot compete (yet) with a client game– Maybe too quick a jump from 1st generation (non-synchronized startegy with staticgraphics) to (attempted) 3rd generation (real-time full 3d action such as Chaos Cars orPoisonville) without using all the opportunities of 2nd generation (such as RPG and RTSstrategy)– Product design vs. monetisation design – quality users vs. quality games (Garden ofUnearthy delights)
21OutlookWhat does this mean for you?• German publishers are in need of great content.• If you have great content, what are you waiting for? They still have tremendous marketingpower.
22ContactSchulte Riesenkampff Rechtsanwaltsges. mbHAn der Hauptwache 760313 Frankfurt am MainGermany(t) +49 69 900 266(f) +49 69 900 26 999Your contact:Dr Andreas Loberandreas.firstname.lastname@example.org