This document summarizes market research on the video game industry in Russia. It finds that the Russian PC and online gaming market makes up 72% of the overall video games market, worth $1 billion in 2010. The document then outlines a proposed free-to-play online PC game strategy, including targeting young male gamers, using social media and video for promotion, and projecting revenue of $20k per month through microtransactions from 10k monthly active users. It includes costs, revenue projections, and a break-even analysis showing the project reaching profitability in year 2.

1. *

2. *

3. MARKET RESEARCH
• Russian market of video games is the largest
market in Central and Eastern Europe. Income
from Computer game sales amounted to U.S. $ 1
billion in 2010.
• PC games and online gaming occupies 72% of
the market share in the video game industry.
Source: PWC research of the (PC Orientated game market)
entertainment industry and mass media
forecast in Russia 2011-15
MARKET POSITIONING
• Free to play online PC game (F2P)
• Why free? 1. Piracy 2. Popularity of F2P in russia
• Micro transaction Model: 53% of Russian active
gamers spend money on game (Source: PWC)
• Target Audience: Young Male Teenagers and adults.
Age group which has the highest ownership of PC
and experience of online gaming in Russia

4. MARKET STRATEGY
Marketing Objective : 60k new players in the first 6 months (Projected from Metin 2,
a fantasy F2P game in Eastern Europe). 10% growth every month after first 6 months.
Long Term Marketing Effort : Marketing Budget of 20% of expected revenue. Budget
adjusted accordingly to market performance
Marketing Budget
80
70
60
50
40
30 Budget
20
10
0
Pre-Launch Launch Launch + 6 Launch + 12
months months

5. Pre-launch
--- Leverage on popularity of social media in Russia
• VKontakte.ru (Russia’s Facebook) ---- Pre-Launch
Group Page, Video banner advertisement, Targeted
advertisement, Preview clips of Game
• Rutube (Russia’s Youtube) ---- Game production
video, Viral videos
--- Advertisement on selected gaming magazines.
--- Sponsored Review and Preview of game on popular
Russian gaming website.
--- Launch of Game website. Invitational keys for free
demo version

6. Launch
--- Countdown Launch Party
--- Distribution of Demo Game CDs in game stores, shopping
centres etc
--- Increased advertising on online and print media
--- SEO: Search engine optimization. Increase traffic and publicity
of our game webpage.

7. SWOT ANALYSIS
Strength
- Unique game play and elements Weakness
- Free to play is an incentive for - Competition from other free to play
players games
- Social Media advertising
BOA
Oportunity
- Mature market of online gaming Threat
- Growth of the russian game market is - Financially dependable on willingness
projected to be fueled by free to play of players to make in game purchases
games .

8. *
COSTS and REVENUE

9. *
• 1 Producer/Designer/Project Manager – Salary of
USD25000 annually
-Manage project development schedule
-Design game system
-Design skills/weapons/maps
• 1 Lead Programmer – Salary of USD22000 annually
-Implement game play mechanics required for the game
-Work on the required network programming
• 1 Programmer – Salary of USD20000 annually
-Implement user interfaces designed by artists
-Program tools to assist artists in implementing created assets into the
game
• 2 Artists – Salary of USD20000 annually
-Create 3D models required for the game
-Create animation, effects, environment
-Design UI
-Design concept art and art for required for marketing

10. Operating Costs (USD)
Year 1 Year 2 Year 3 Year 4 Year 5
Staff Salary
1 Producer/Designer/Project Manager 25000 25000 25000 25000 25000
*
2 Programmers (1 programmer after 1st year) 48000 24000 24000 24000 24000
2 Artists (1 artist after 1st year) 40000 20000 20000 20000 20000
Software Cost
Unity 3D Pro engine license (One time
7500 6000 6000 6000 6000
USD1500) with support (USD 500/month)
Music License (USD 89/month) 1068 1068 1068 1068 1068
Modeling / Programme Software License (One
time payment cost of USD1000) with possible 1000 500 500 500 500
upgrade (USD500)
Other software licenses 1000 1000 1000 1000 1000
Hardware Cost
5 X Computers (USD1000) / Equipments
10000 1000 1000 1000 1000
(Average USD1000 per year)
Game Server (USD0.89/Slot) with speculated
0 44500 44500 44500 44500
50K player per month from year 2 onwards
Marketing Cost
Social Media (Facebook, Twitter, Blog) for
10000 click per month for 1st year for all 50000 30000 20000 10000 10000
social media sites with USD0.20 per click
Web Media (Website, SEO, Community Forum) 1000 1000 1000 1000 1000
Distributors (Eg Steam, Amazon) with one
time payment about USD100 entrance and 25000 25000 25000 25000 25000
average 10% transaction fees
Miscellanous Cost
Office Rental in Moscow (1989 Area Sq M) 5880 5880 5880 5880 5880
Utilities 4800 4800 4800 4800 4800
Total/Year 220248 189748 179748 169748 169748

11. • Inventory purchase
• Better Maps
• Elements
• Skin
• Skill and stat points
*

12. *
A: Active Users --- How many players you
have visiting your game's online store
B: Attach Rate --- How many players
bought stuff
C: ARPPU --- Average revenue per paying
user
A * B * C = Revenue.
Projected revenue per month: 10k players * 0.20 attach rate * USD 10
per paying user = USD 20K monthly and USD 240K yearly in revenue.

13. BreakEven Analysis (USD)
*
Capital- Fixed Total
Revenue Cost Profit Time
Profit Cost cost
0 220248 -220248 29752 1 250000 470248
240000 189784 50216 79968 2 250000 189784
260000 179748 80252 160220 3 250000 179748
280000 169748 110252 270472 4 250000 169748
280000 169748 110252 380724 5 250000 169748
400000
350000
300000
250000
Money
200000
Capital
150000
Capital-Profit
100000
50000
0
0 1 2 3 4 5 6
Year

14. *