The document outlines Ubisoft's business activities, including development, publishing, and distribution of video games, along with their historical expansion and acquisition strategies from 1986 to 2009. It provides insights on sales performance and the increasing focus on development titles, highlighting the pros and cons of this approach. Additional references to sources such as annual reports and relevant articles are also included.

2. THE VIDEO GAME BUSINESS
www.videogamebusiness.wordpress.com
@videogamebiz
videogamebuziness@gmail.com
The Video Game Business © 2

3. The Video Game Business
Group Activities
The Video Game Business © 3

4. Group Activities
 Development
– Sales of titles developed, produced and marketed by Ubisoft’s internal studios
– Revenues from 3rd party developers supervised and co-produced by Ubisoft
 Publishing
– Sales of titles produced by 3rd parties but financed and supervised by Ubisoft
in exchange for acquiring the licenses
– Costs: localization, manufacturing, sales and marketing, payment of royalties
to developers and/or brand owners
 Distribution
– Sales on products from publishers with which Ubisoft has signed distribution
agreements and handles sales and marketing
– Can be limited to specific geographic areas
The Video Game Business © 4

5. Group Activities as % of Total Sales
Sales in 08/09
Sales in 09/10
4%
8%
7%
11% Development
Publishing
Distribution
81% 89%
The Video Game Business © 5

6. Increase of Development as % of Sales
(see previous graph)
Pros Cons
Stronger brand: Ubisoft will have a greater focus on generating new Higher risk: investment of capital in new IPs + cost of development
IPs which can turn into multi-million dollar franchises has been increasing increased = higher exposure
Royalties as % of sales ↓ Greater fixed costs (salaries, lease/depreciation) as a proportion of
total sales  if sales decrease, costs will not down as quickly
Loss of market share less likely as product offered is different from
the competition (publishing/distribution: hard to stand out from the
crowd by ways other than lower offering lower prices)
The Video Game Business © 6

7. Change in Number of Titles Developed
45
40
35
30
25
06/07
20
07/08
15
08/09
10
09/10
5
0
Internal Co-production Publishing Distribution
production (dvmpt)
(dvpmt)
The Video Game Business © 7

8. The Video Game Business
History
The Video Game Business © 8

9. History
 1986: Creation of Ubisoft
 1989-1995: International expansion
– Distribution subs: USA, Germany and UK
– Studio creation: France & Romania
 1996
– Flotation on EPA (Paris Stock Exchange)
– Studio creation: Shanghai (China)
 1997
– Studio creation: Montreal (Canada)
 1998
– Studio creation: Morocco, Spain and Italy studios
 1999
– Studio creation: Annecy (France) and Montpellier (France)
– Distribution subs: Honk Kong, Netherlands, Denmark, etc
The Video Game Business © 9

10. History (continued)
 2000
– Acquisition: Red Storm Entertainment (Tom Clancy games)
 2001
– Acquisition: Blue Byte Software (Games: Settlers) and game division of
The Learning Company (Games: Myst and Prince of Persia)
 2003
– Acquisitions: Tiwak studio (Game: Tork)
 2005
– Acquisition:MC2-Microids in Canada  merged w/ Montreal studio
 2006
– Acquisition: Driver and Far Cry franchises
– New licence: CryEngine
– Sales offices: Mexico
– Studio creation: Bulgaria
The Video Game Business © 10

11. History (continued)
 2007
– Studio creation: Chengdu (China)
– Acquisition: Digital Kids (Japanese studio specialized in DS games),
Action Pants (Canada), Southlogic (Brazil), Massive Entertainment
(Sweden) and an unnamed studio in Pune (India)
– Brands purchased: Anno and Tom Clancy name
– Digital image production studio (Canada)
 2008
– Acquisition: Hybride (special effects in films)
 2009
– Studio creation: Toronto (Canada)
– Acquisition: Nadéo (Trackmania)
The Video Game Business © 11

12. References
 Business Week:
– Management: http://investing.businessweek.com/research/stocks/people/people.asp?ticker=UBI:FP
 Ubisoft:
– Annual reports: http://www.ubisoftgroup.com/index.php?p=195
– Ubisoft Group: http://www.ubisoftgroup.com/
 Wikipedia:
– Yves Guillemot: http://fr.wikipedia.org/wiki/Yves_Guillemot
– MC2-Microids: http://fr.wikipedia.org/wiki/Micro%C3%AFds
The Video Game Business © 12