why mobile social games need a platform now morethan ever - eros resmini - openfeint

Why Mobile Social Games Need a Platform Now More than Ever

Eros ResminiSVP of Marketing & Developer Relations

Copyright © 2004-2012 GREE,Inc. All Rights Reserved.Confidential


Founded

Founder & CEO

January 2011

Naoki Aoyagi

Tokyo

San Francisco

Founded

December 2004

Yoshikazu Tanaka

CEO

International

GREE Overview

Japan’s Leading Mobile Social Gaming Platform


OpenFeint Overview

Leading Mobile Social Gaming Ecosystem

• Mobile social gaming standard with millions of users globally

• Cross platform ecosystem: iOS + Android

• Open source & customizable UI

• Founded in April 2009 in Burlingame, California

• Acquired by GREE in April 2011


Net Sales & Operating Profit

USD 2007 2008 2009 2010 2011

Net Sales 3.8M 34.6M 164.1M 414.5M 750M

O. Profit △ 1.2M 12.3M 98.4M 230.3M 370M

US

D (

Mill

ion

s)

* Fiscal year-end, June 30

GREE Financial Overview

• $5 Billion market cap

• Fastest Growing Tech Company in Japan

• 2,636% revenue growth over 3 years

• Q2 FY2012 record high revenue ($536M) topped Zynga ($311M)

Source: Deloitte Technology Fast 50 Japan 2010


GREE’s Global Reach

San Francisco

London

Tokyo

Beijing

Singapore

Amsterdam

São Paulo

Seoul

Dubai


2010 2011

7500+Live Games

Live G

am

es

2010 2011

Growing User and Game Network

190+ MM Unique User Accounts

Pla

yers

(M

illio

ns)

2012 2012


mobile social designA Platform Symbiosis


Growth in Free-to-Play Games

Game Design Shifting to Freemium with IAP

Premium games monetize users once

F2P games monetize users many times

Virtual goods market was $7.3B in 2010; will double by 2014

Premium Game

Free-to-play with IAP

Longer play = more $$$$

Download App

Time game played

$ Paid

User Revenue

Source: Zynga SEC filing, via In-Stat market intelligence firm.


Free-to-Play Games MonetizeUS App Store: 20 of Top 25 Grossing Games are Free to Download

Source: iTunes store February 18, 2012


IAP Increasingly Generates Revenue

Source: Distimo Report, 2011 (* Top 200 grossing iPhone apps in the US per month)

% of 2011 US Apple App Store Revenue from Free Apps


Goal of Freemium Games

=LifetimeValue(LTV)

Revenue Per User X

Player Engagement

Cost Per Acquisition

(CPA)

Increase Player Lifetime Value (LTV)


Goal of Freemium Games


(CPA)

LTV Greater than Cost Per Acquisition (CPA)

LifetimeValue(LTV)


SNS or social platform

Game Economics

Social Games are Special

=LifetimeValue(LTV)

Revenue Per User

X

Player Engagement


(CPA)

Social is a unique variant of “freemium” that uses social network effects to increase LTV and lower CPI/A

Request

s fr

om

fr

iends


Social Gaming Ecosystem

Social Games are More Efficient on Platforms

Facebook: Users Start with SNS, then Discover and Play Games

Mobile: Users Start with Games, then Tap into SNS


Benefits of Social Games Ecosystem

• App portal optimizes distribution

• Cross promotion builds user base

• Social & communication tools engage users

• Games and platform engage users

• Viral effect cross games

• Standard virtual currency across all games on platform increases ARPU

Optimizes Acquisition, Retention, Monetization

SNS

Acquisition

Retention

Monetization

Social Platform


Why Fragmentation is Inefficient

Multiple campaigns

“Loose coupling” of users

Email, SMS, notifications

Dependent on retentionUniv. currency, VG tools

High cost &

poor results

Low retention

Difficult to increase ARPU

Inhibits Acquisition, Retention, Monetization

AcquisitionThrough

Multiple AdNetworks

RetentionChannels are

Weak

Limited Monetization

Due toEconomic

Scale


Case Study: Game Evolution on PC & Mobile


PC: Casual Game Portals

Early Portals Lacked Strong Social Effects

SNS

Most portals lacked social features, inhibiting player-to-player interaction.

Some portals emerged offering weak social features, badges, and micro-transactions.


PC: Facebook

Social Games Emerged on Facebook in 2007

SNS

Facebook won social and dominates the online social gaming market.

Developers leverage Facebook’s high DAU and social effects to retain and monetize users.


出所： MorganStanley 「 Mobile Internet Trend 」より当社作成

Smartphone Sales Outpace PC Sales

2012: A Pivotal Moment

Global Smartphone vs PC Sales


Mobile: Fragmented Network

Games on Mobile are Currently in a Fragmented Player Ecosystem

SNS

Users currently discover social network within each game.

Fragmentation makes acquisition, retention and monetization challenging for developers.


Arcade GamesFree-to-Play

Games with In-App Purchases

& Virtual Economics

Free-to-Play Social Games (fragmented ecosystem)

Free-to-Play Social Games (within social

network)

Mobile Game Type Evolution

Mobile Game Type Becomes Increasingly Social


Mobile: Social Gaming Platforms

Platforms are Emerging to Solve Fragmentation

SNS

Acquisition

Retention

Monetization

MobileSocial

Platform

Similar to the shift we saw on PC, mobile games are moving to social platforms.

These platforms provide efficient channels and features for developers.


Current global marketEmerging Mobile Social Platforms


NimbleBit: Tiny Tower

Social games can be successful without platforms and viral friending loops

Apple named Tiny Tower the 2011 iPhone Game of the Year

Boasts 1 million DAU

Zynga recently announced similar title on mobile called Dream Heights

Mobile Social Game Without a Platform

Sources: http://www.pocketgamer.biz/r/PG.Biz/Tiny+Tower/news.asp?c=36660http://www.gamesbrief.com/2011/07/ios-tiny-tower-on-track-to-make-3-million-in-its-first-year/


Global Mobile Market Challenges

… but several platforms are emerging


Potential Platform Landscape

SNS Focus

Game Focus

Social Platforms Meta-Platforms

Studio PlatformsOS Platforms


Business Field

SNS Platform

✔

✔

-

-

Game Mobile

✔ ✔ ✔✔

✔

DeviceGlobal

Unified ID

✔ ✔ ✔ ✔ -

✔

✔

✔

✔

✔

Business Strength

✔

GREE Integrates User IDs, SNS, Games, Platform

Game Center

Google+

✔ ✔ ✔

✔ ✔ ✔

✔ ✔

- ✔


GREE global platform

GREE Platform:Addressing Global Mobile Audience


Social Games 7,000+ Games

Current

GREE Japan

Platform

Current

OpenFeint

Platform

New Global

GREE Platform

150MM+ users 12,000+ developers

High-ARPUusers, plus social

know-how

GREE + OpenFeint

A New Global Platform for Developers and Gamers


GREE Platform Strategy

Global

Social

Open

Offer developers the most robust toolset to take advantage of the global mobile gaming market


Comprehensive Offering

Distribution

Analytics

190 MM Users

Unified global platform Key regional distribution partners

Localization services

Cross promotions through developer announcements

Promotional programs

Wall posting

Gifting

Social sharing

Push Notifications

Universal billing

International currency management

Friend invites

Incentivized invites

Social sharing

Gifting

Dashboard access to game analytics

Game, player, and monetization data

Acquisition

Engagement Virality

Monetization


We’re Hiring! Apply Now

- Admin & HR- Art & UX- Business Analysis- Biz Dev & Operations- Engineering

- Legal- Marketing & PR- Operations- Product - Sales

San Francisco office apply at GREEjobs.com

London, Beijing, Singapore, Seoul offices apply at corp.gree.net/uk/en/

why mobile social games need a platform now morethan ever - eros resmini - openfeint

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