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DeNA And GREE:
My Perspective On Japanese Social Games Going
Global




              By Serkan Toto, PhD
              www.serkantoto.com
About Me
• Tokyo-based web, mobile and gaming
  industry consultant
• Advisor for startups in Asia and the US
• Japan contributor for TechCrunch.com
• Personal website: www.serkantoto.com
Contact Information
Twitter: http://twitter.com/serkantoto

LinkedIn: http://linkedin.com/in/serkantoto

Email: totoserkan AT gmail.com
Visit My Website For Free Information On Japan’s
Social Game Industry (http://www.serkantoto.com)
Question 1:
Do you really see millions of users in
the US, Europe, and Asia prefer
playing games on GREE and
Mobage over Facebook and the
others?
Question 2:
Do you really see China allowing
game platforms from Japan to play a
crucial role in its domestic market?
Opinion:
“GREE and DeNA are poised to fail
outside Japan - at least as platform
providers.”
(Note: I hope I am wrong.)
Just a few pointers. There are many
more.
Point 1: Japan-Only Success Factors
 •  Key success factors that fueled DeNA and
    GREE‘s growth in Japan don‘t apply elsewhere.
 •  Examples:
    •  Carrier billing
    •  Game-friendly society
    •  Mobile-centric users
    •  Japan‘s ARPU for social games is unique
       globally
    •  Fast, reliable 3G networks (example: in SEA)
    •  Affordable mobile data plans
Point 2: Popularity of Japan-Specific Games
 •  The biggest social games in Japan are card
    battle games: acceptance abroad is uncertain.
    First titles from Japanese game firms flopped.
 •  Genres like dating simulations or social horse
    racing games difficult/impossible to transplant.
 •  Game design is heavily influenced by Manga
    and Anime culture.
 •  US and European game developers have
    caught up/overtaken their Japanese
    counterparts.
Point 3: Heavy Competition In Mobile Social
Point 4: Japanese Management Is Unique
 •  Incompatibility between Japanese and foreign
    management styles and business cultures is well
    documented in economic literature.
 •  Example from the social game industry: the
    Openfeint <-> GREE case from September
    2011.
 •  Integration of startups (Openfeint, ngmoco) and
    listed large-cap companies (GREE, DeNA)
    makes things even worse.
Point 5: History
 •  Fact: in the entire web and mobile business
    history, absolutely no Japanese company
    succeeded abroad.
 •  Example: NTT Docomo‘s i-mode. But there are
    many, many more.
 •  Nintendo and Sony PS comparison doesn‘t
    count (the social game market in the 2010s has
    nothing in common with the video game market
    in the 1980s/1990s).
Point 6: No Causality
 •  Being successful in Japan and understanding
    mobile does not automatically lead to success
    outside the country, as DeNA and GREE
    suggest (see point 1).
 •  Zynga got burnt in Japan even though they
    have acquired a startup, teamed up with local
    companies (SoftBank Mobile, Mixi), and clearly
    know how to do social games.
    -> similarity?
Thank you for listening!
     Questions?
Contact Information
Twitter: http://twitter.com/serkantoto

LinkedIn: http://linkedin.com/in/serkantoto

Email: totoserkan AT gmail.com

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DeNA And GREE: My Perspective On Japanese Social Games Going Global

  • 1. DeNA And GREE: My Perspective On Japanese Social Games Going Global By Serkan Toto, PhD www.serkantoto.com
  • 2. About Me • Tokyo-based web, mobile and gaming industry consultant • Advisor for startups in Asia and the US • Japan contributor for TechCrunch.com • Personal website: www.serkantoto.com
  • 3. Contact Information Twitter: http://twitter.com/serkantoto LinkedIn: http://linkedin.com/in/serkantoto Email: totoserkan AT gmail.com
  • 4. Visit My Website For Free Information On Japan’s Social Game Industry (http://www.serkantoto.com)
  • 5. Question 1: Do you really see millions of users in the US, Europe, and Asia prefer playing games on GREE and Mobage over Facebook and the others?
  • 6. Question 2: Do you really see China allowing game platforms from Japan to play a crucial role in its domestic market?
  • 7. Opinion: “GREE and DeNA are poised to fail outside Japan - at least as platform providers.” (Note: I hope I am wrong.)
  • 8. Just a few pointers. There are many more.
  • 9. Point 1: Japan-Only Success Factors •  Key success factors that fueled DeNA and GREE‘s growth in Japan don‘t apply elsewhere. •  Examples: •  Carrier billing •  Game-friendly society •  Mobile-centric users •  Japan‘s ARPU for social games is unique globally •  Fast, reliable 3G networks (example: in SEA) •  Affordable mobile data plans
  • 10. Point 2: Popularity of Japan-Specific Games •  The biggest social games in Japan are card battle games: acceptance abroad is uncertain. First titles from Japanese game firms flopped. •  Genres like dating simulations or social horse racing games difficult/impossible to transplant. •  Game design is heavily influenced by Manga and Anime culture. •  US and European game developers have caught up/overtaken their Japanese counterparts.
  • 11. Point 3: Heavy Competition In Mobile Social
  • 12. Point 4: Japanese Management Is Unique •  Incompatibility between Japanese and foreign management styles and business cultures is well documented in economic literature. •  Example from the social game industry: the Openfeint <-> GREE case from September 2011. •  Integration of startups (Openfeint, ngmoco) and listed large-cap companies (GREE, DeNA) makes things even worse.
  • 13. Point 5: History •  Fact: in the entire web and mobile business history, absolutely no Japanese company succeeded abroad. •  Example: NTT Docomo‘s i-mode. But there are many, many more. •  Nintendo and Sony PS comparison doesn‘t count (the social game market in the 2010s has nothing in common with the video game market in the 1980s/1990s).
  • 14. Point 6: No Causality •  Being successful in Japan and understanding mobile does not automatically lead to success outside the country, as DeNA and GREE suggest (see point 1). •  Zynga got burnt in Japan even though they have acquired a startup, teamed up with local companies (SoftBank Mobile, Mixi), and clearly know how to do social games. -> similarity?
  • 15. Thank you for listening! Questions?
  • 16. Contact Information Twitter: http://twitter.com/serkantoto LinkedIn: http://linkedin.com/in/serkantoto Email: totoserkan AT gmail.com