1. Monetization trends by Territory
Paha Schulz, Director of Business Development
Crytek

2. • Korean – German
• 13 Years in the Games Industry
• 6 Years Asia, 7 Years Europe (4 Years UK, 3 Years Germany)
• NCsoft (Korean HQ & Europe), Electronics Arts, Crytek
• Business Development, Online Publishing, Market Analysis, Marketing, Production,
Monetization
• Currently Responsible at Crytek:
a. Warface & other Games-as-Service Title Business Development
b. Portolio Management: Games-as-Service Content Sourcing
Paha Schulz – Who am I

3. • One of Europe’s largest independent game developers
• Digital entertainment and technology creator
• 14 Years in business
• 800+ employees from 40+ nations in 10 studios worldwide
• 5 AAA games released, 5+ in development
• Expanding business, via technology, into: Real-time 3D for Simulation, Education, Film
and TV, Online
Crytek – Company Facts

4. Crytek - Core units & brands
•Creation of interactive
entertainment content & franchises
based on CryENGINE technology
•Platforms: Console, PC, Online,
Mobile
•Development & licensing of
CryENGINE technology
•Development & operation of social
publishing platform
•Serve as an independent freemium
distribution and service platform for
online
games & content
GAMES
REALTIME 3D
TECHNOLOGY
SOCIAL
ENTERTINAMENT
PLATFORM

5. Monetization trends by Territory
Let’s start!

6. Definition of FREE (Economy)
Free 1
•Direct Cross-
Subsidies
•i.e.: try first
free, buy
later
Free 2
•3rd party
Market
•i.e. ad-
supported
Free 3
•Freemium
•i.e. Paid users
subsidy free
users
Free 4
•Nonmonetary
Markets
•i.e. Attention,
reputation,
likes
Free: The Future of a radical price
Book by Chris Anderson (author of “The Long Tail”)
Free economy is a subsidy economy

7. Focus for territorial differences in context
Free 1
•Direct Cross-
Subsidies
•i.e.: try first
free, buy
later
Free 2
•3rd party
Market
•i.e. ad-
supported
Free 3
•Freemium
•i.e. Paid users
cover free
users
Free 4
•Nonmonetary
Markets
•i.e. Attention,
reputation,
likes

8. Free 1: Not obvious, but many games do this
Free 1
•Direct Cross-
Subsidies
•i.e.: try first
free, buy
later
Hybrid of Free
1 & 3
•Freemium
but at certain
point
becoming
direct cross-
subsidies
• “Lite” VS full model
• Demo, shareware etc.
• F2P games which at some point get
impossible to play without paying
• Mobile games which are F2P, but not
necessary online multiplayer focus tend to be
like this more

9. FREE 2: Some territories have specific 3rd party models
Free 2
•3rd party
Market
•i.e. ad-
supported
South Korea: PC Bang (Internet Café) B2B (3rd party) business model

10. Free 3: Most territorial differences
Free 3
•Freemium
•i.e. Paid users
cover free
users
Demand of Free
User
•Expectation of
the services,
content & game-
play provided for
free
Demand of
paying user
•Expectation of
services, content,
& additional
game-play if paid
Matter of Behavioral economics (social, cognitive and emotional factors)

11. Why the difference?
1. Cultural differences in social physiology
• Ex: You paid, you deserve to be better VS you paid, you cheated
2. Industry history of different anchoring
• Ex: all the games I played charged weapons for time usage VS permanent but breakable weapons
3. Cultural difference of behavior, preference & popularity
• Ex: I want my character to look like this K-pop idol VS I want my character to look gritty and manly
4. Difference in Disposable Income
• Ex: I need to skip lunch to get this item VS Where can I put my credit card details
5. Legal & legislation differences
• Ex.: Random items are gambling, You can’t kill Pandas, PvP with item-drop possibility is 18+

12. 1. Cultural differences in social physiology
2. Industry history of different anchoring
3. Behavior, preference & popularity
4. Difference in Disposable Income
5. Legal & legislation differences
West VS Asia
West
• Pay2win is unfair
• Free2play is low quality
• Give me my different
choices
• I have more money then
time to do this
Asia
•Let me pay to be better at this
•Everything is free to play
(legitimate or pirated)
•Give me the best option to
feel like a Movie star
•I still don’t want to pay and
rather find a way to spend
time on it (even if I have the money)
•Our government dictates what
is not allowed in the games
*High-level generalization

13. 1. Cultural differences in social physiology
2. Industry history of different anchoring
3. Behavior, preference & popularity
4. Difference in Disposable Income
5. Legal & legislation differences
Asia: China VS Korea VS Japan
China
•That guy has money &
paid, that’s a skill
•This game charges
different to Crossfire
•The K-pop girl skin is
cool!
•I don’t have money to
spend this week
•No killing panda, no
skulls, no playing too
much every day
Korea
•That guy paid, I hate
him
•This game charges
different to Sudden
Attack
•This K-pop girl skin is
cool, but what’s the
stats?
•I don’t WANT to spend
money you evil game
•Under-aged shouldn’t
play after 12am, PvP is
for adults, maybe
games are like drugs
Japan
•Let’s not play
competitively, play
cooperatively
•Where is the gatcha?
•Anime, Manga, Otaku
• Gatcha! Here is my
money!
•Gambling is bad but
gatcha is good
*High-level generalization

14. West: North America VS Europe VS Russia
1. Cultural differences in social physiology
2. Industry history of different anchoring
3. Behavior, preference & popularity
4. Difference in Disposable Income
5. Legal & legislation differences
North America
•Can’t I just put in my
credit card &
subscribe?
•F2P are games on
Facebook and
mobile
•My character looks
like Wolverine. It’s
awesome!
•Credit Card pays for
me
Europe
•This game is broken,
you have to pay to
win
•F2P are browser
games or low quality
PC games
•Barbarians! Vikings!
Napoleon!
•I only have cash,
how can I give you
this?
•German
government doesn’t
allow X
Russia
•I like capitalism. You
pay and you get it.
•F2P has low quality
service, but’s it’s
free and if you pay it
gets better
•This public holiday
outfit is cool!
•I have money to
spend, just give me
the reason
*High-level generalization

15. Case Study: Warface

16. North America & Europe
•Gface is Crytek‘s own developed & operated
social publishing platform
•Serve as an independent freemium distribution
and service platform for online games & content
Crytek own
Social Game Platform
Asia & Emerging Markets
Publisher Territory
•More territories & deals in
negotiations
Warface: Global Service
Development
Team
Live Team
Publishing
Team
•Major content development
• Overall creative direction
•Local content development & tweaking
• Owner of live environment
• Owner of publishing & service
• Either local publisher or Gface

17. Tools to adopt & localize (culturelize)
Numeric changes
• Make as many things numeric (progression, weapon recoil, XP, rewards etc. etc.) and make
it easy to be changeable with tools live operators can change easily
All monetization models switchable
• permanent items, time based items, micro-subscriptions, random items etc. etc. Have them
all in the system, and turn on what works and don’t what doesn’t
Local cultural items
• Manly version, K-pop version, Anime version etc. etc. be flexible enough to provide relevant
content and be open to regional experts
Good Analytical tracking systems
• No use of being flexible if you don’t know what’s happening during live service. Have good
analytical tracking systems in place to be responsive & reactive to game community

18. Paha Schulz
Director of Business Development, Games-as-Service
Email: paha@crytek.com
Crytek GmbH
Grüneburgweg 16-18
D-60322 Frankfurt am Main