Social Games In Japan 2013: Status Quo, Trends And Internationalization

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This is the (edited) version of a presentation on the social gaming industry in Japan I gave a few days ago in Tokyo.

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Social Games In Japan 2013: Status Quo, Trends And Internationalization

  1. Japan‘s Social Gaming Market 2013:Status Quo, Key Trends & Internationalization By Serkan Toto, PhD www.serkantoto.comImage credit: DeNA
  2. About Me•  Social and mobile gaming industry consultant•  Advisor for startups in Japan and the US•  Japan contributor for TechCrunch.com•  Based in Japan since 2004•  Hardcore gamer•  Personal site: http://www.serkantoto.com
  3. Visit My Website For Free Information OnJapan’s Mobile Game Industry(http://www.serkantoto.com)
  4. Contact InformationTwitter: @serkantotoLinkedIn: http://linkedin.com/in/serkantotoEmail: serkan AT serkantoto.com
  5. AgendaI: Status Quo Of Japan’s Social Gaming MarketII: 10 Key Trends In Japan (And Asia)III: Internationalization Efforts
  6. I: Status Quo Of Japan’s SocialGaming Market
  7. Japan‘s Unique Social Landscape•  4 homegrown social networks with roughly     25-40+ million registered users each: –  Mixi (80% mobile social networking) –  GREE (mobile social gaming) –  Mobage (mobile social gaming) –  LINE (mobile chat application)•  Twitter: 30+ million users•  Facebook: 19+ million MAU
  8. Fragmented Game Market•  ~300-400 social game providers in Japan.•  20+ game platform providers (all mobile).    •  2 dominant companies as platform and game provider hybrids: GREE and DeNA (“Facebook+Zynga in 1“).•  LINE (since July 2012), Kakaotalk (February 2013), and dgame (December 2012) emerge as domestic competitors.
  9. Japan‘s Social Gaming Ecosystem
  10. Size Of Japan‘s Social GamingMarket-> Projection from Morgan Stanley, January 2012    
  11. Size Of Japan‘s Social GamingMarket-> Projection from Nomura Research, January 2012    Image credit: The Nikkei
  12. Size Of Japan‘s Social GamingMarket-> Other sources (July 2012)    •  Ministry Of Internal Affairs:US$3.26 billion (2011)• Japan Online Game Association:US$3.6 billion (2011)-> SuperData: US market sized at $1.4 billion in2011, to grow to $2.4 billion by 2014.
  13. Size Of Japan‘s Social GamingMarket-> Projection from Yano Research, January 2013
  14. Extremely High Paying User Ratio-> Morgan Stanley offers more insight.
  15. Spending Patterns-> Not much difference compared to other regions
  16. 4 Big Reasons Why Japanese PlaySocial Games
  17. The Top 5 User Demographics ForSocial Games
  18. Some User Data From GREE
  19. The  Top  10  On  Mobage.  
  20. The  Top  10  On  GREE.  -­‐>  Note:  on  feature  phones,  GREE  doesn‘t  show  their  own  Atles  in  the  ranking.  
  21. II: 10 Key Trends In Mobile GamingIn Japan (And Asia)
  22. Trend 1: Smartphone Revolution    Source:  Impress  R&D  
  23. Trend 2: Shift To The App Economy
  24. Trend 3: Rise Of The Chat Apps
  25. Trend 3: Rise Of The Chat Apps
  26. Trend 4: Competition In Platforms
  27. Trend 4: Competition In Platforms    Image credit: TechCrunch Japan
  28. Trend 5: Puzzle & Dragons Hype
  29. Trend 5: Puzzle & Dragons Hype
  30. Trend 5: Puzzle & Dragons Hype
  31. Trend 5: Puzzle & Dragons HypeImage credit: Social Game Info
  32. Trend 5: Puzzle & Dragons Hype
  33. Trend 6: Next-Gen Social Games
  34. Trend 7: Regulation (?)•  There are now payment caps for younger players on DeNA and GREE.•  Real-money, off-platform trading of virtual items is still a problem.•  Certain bingo/lottery-like gaming mechanics are banned.•  Odds of winning are now disclosed in gacha.•  JASGA has been established.
  35. Trend 7: Regulation (?)
  36. Trend 8: Card Battle Fatigue (?)
  37. Trend 8: Card Battle Fatigue (?)
  38. Trend 8: Card Battle Fatigue (?)
  39. Trend 8: Card Battle Fatigue (?)
  40. Trend 9: Diversification
  41. Trend 10: Internationalization
  42. III: Internationalization Efforts
  43. DeNA And GREE’s PlatformBusiness Outside Japan Failed
  44. DeNA And GREE’s PlatformBusiness Outside Japan Failed•  GREE International publicly acknowledged the platform (in the US) is „on ice“.•  Openfeint was shut down in December 2012.•  GREE‘s HTML5 platform is poised to fail, too.•  Mobage offers 75 games on its English- language platform now – 20 months after launch in the US (Japan: 1,500+ games).•  Mobage moved to FB and Twitter integration.
  45. Positive Signs Exist (In The US)
  46. Positive Signs Exist (In The US)
  47. Difficult Situation In China•  GREE is active in China with an office, a partnership with Tencent, and various investments. There seems to be no progress.•  DeNA is much more active in China. It runs dozens of partnerships with handset makers, telcos and app stores. Mobage had 60 games and 5 million users in August 2012.•  Both companies are very, very quiet about the Chinese market.
  48. Difficult Situation In China
  49. Japanese Content Does Well In SK
  50. Outlook On Internationalization•  The future will likely see both GREE and Mobage turn into content providers and publishers. People want games, devs want distribution - not platforms-inside-platforms.•  DeNA in particular is running a number of titles successfully already.•  GREE‘s Funzio titles are doing well.•  Japan (and other markets in Asia) offer a big reservoir of excellent content providers.
  51. Transferability Of Content Is Key "Key issue: art style and themes"
  52. Thank you for listening! Questions?
  53. Contact InformationTwitter: @serkantotoLinkedIn: http://linkedin.com/in/serkantotoEmail: serkan AT serkantoto.com

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