Steam Updates Storefront: Is Discovery the Key for Mobile?

Steam-Logo

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Steam’s slogan for its new update says it all: A Smarter Storefront. Personalized Just For You.

The update introduces a “smarter” homepage that recommends games based on past purchases, what you’ve been playing, and friends’ recommendations. While this type of personalized targeting has been widely popular with music and video platforms like Netflix and iTunes, the game industry has been slow to follow suit. Steam’s new update may be the push we need towards better discovery tools in a saturated content industry. 

In the past nine months alone, over 1,300 new titles have been added to Steam, which brought the total catalog to over 3,700 games. For indie devs with little to no money to spend on advertising, getting page traffic was difficult to say the least. By far the most interesting feature of the new update is the ability to follow “curators”. Curators can be any individual or organization with an opinion on games and wants to share them. Steam’s curator pages now offer a place to organize these recommendations and following a curator will also send their recommendations to your homepage. To become a curator, you need to create a group, or already be an officer or moderator in a group.

 

After less than a week, the update has been having a big impact as one Gamezone article notes:

Developers have been very open about how the update has affected them, taking to both their blogs and Twitter accounts to reveal the changes they’ve seen on their Steam Store Pages. Andrew Spearin, the Creative Director at New World Interactive took to his blog to reveal the affects of Steam’s Discovery Update on Insurgency (a tactical FPS). Spearin cited how much trafficInsurgency‘s Steam Store Page received prior to the update and post update, here are the numbers:

  • Sunday: 5,800 (pre-update)
  • Monday: 21,500 (post update)
  • Tuesday: 83,284 (post update)

While he did admit that the game was recommended by prominent figures (and Curators) in the gaming world, the spike in people visiting the store page is obvious. If you’re wondering just how visible Insurgency has become on Steam due to the update, the figure is “370% over night.” Spearin is not the only one discussing the potential that Steam’s update has allowed for indie devs.

Curating on mobile

If 3,700 games to sift through seems like a lot, consider that the Google Play Store now has 1,500,000 live apps. Even if only 1% of that were high quality games worth playing, that would still be a whopping 15,000 titles to sort through. With more apps added every day, discovery on both Andriod and iOS is becoming difficult for studios on shoestring budgets. So could a curator model much like Steam introduced be the answer? Korea has been experimenting with that very idea for a while now.

Afreeca TV is a popular video streaming service, though it is not well known outside of Korea. Given that live streaming popular online games like League of Legends and Starcraft are by far the most popular streams on the platform, it made sense when Afreeca TV dipped their feet into the mobile gaming pool last year with the introduction of the Gamecenter.

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Broadcasting Jockeys, known by the unfortunate acronym BJs, create “clans” where they can live stream their favorite mobile games, and even play with their fans. Their audience can reward them by buying “chocolate”, a premium currency on the platform that can be exchanged for items in the store, and even real cash. Users, in turn, earn chocolate by downloading games, making in-app purchases, and participating in the platform in other ways.

So far the platform is quite small and experimental, with just 178,000 Gamecenter subscribers, but engagement levels are high with the average user playing 5.5 games on the platform.

Is this the next move for Google and Apple?

With such great results for video and music services, and impressive possibilities being explored by Steam, could this be the future for mobile gaming as well?  This would work particularly well in Korea where word of mouth from trend-setting power-bloggers is a powerful marketing channel. Do you think this would work on a scale as big as Google Play and Apple? Leave a comment below and tell us what you think!

The Risk of Acquiring a Hit Game

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TechCrunch’s Josh Constine hit the nail on the head yesterday: acquiring a hit game is stupid. Commenting on the announcement that Microsoft is acquiring Mojang, makers of Minecraft, for $2.5 billion, he had this to say:

Buying a game company is like buying an aging baseball player. You’ll need a miracle to get another hit. And while they might have plenty of fans, they probably aren’t making a lot of new ones…There’s no guarantee it will produce another blockbuster; players will eventually move on from Minecraft, and I doubt anyone is going to buy a dopey Windows Phone just to play a slightly different version of the pixelated sandbox game.

Have we learned nothing from Zynga, Rovio, King and Dong?

Valuing a game on a user-base, as fickle as most gamers are, is asking for disaster. Case in point, Zynga and King both did their IPOs on the heels of their success with FarmVille and Candy Crush Saga. Both have tanked since as their users moved on to the next flavor of the year. This is especially true on mobile where brand loyalty is almost non-existent.

Rovio has long tried to run counter this by establishing themselves, not as a game company but as a brand. Rovio’s spokesman, Peter Vesterbacka, can be heard repeating this mantra at game conferences around the globe. They have their hands in toys, amusement parks, snacks, and even perfumes. But as Constine points out:

there are only so many pigeons you can chuck at pigs, and now its CEO is out after profits sank 52 percent in 2013. If someone had acquired Rovio at the height of its success, they’d be kicking themselves with steel-toed boots right now.

There is an argument to be made that Minecraft does have some unique characteristics that might make it a more valuable proposition. As Keith Noonan at the Motley Fool noted:

The notion of paying more than $2 billion to acquire a company that is primarily known for one game is sure to raise some eyebrows; but Mojang and Minecraft may be a special case. Very few titles in the history of gaming have shown evidence of comparable staying power, and few have a similar potential to aid Microsoft’s aim of bringing its existing gaming resources together with its mobile and cloud focus. If Mojang can engineer successful follow-ups to its megahit, inside the series and beyond it, the company would justify its asking price and be a significant asset for Microsoft.

Even Constine sees there may be hidden potential, noting the game has potential to become a digital platform for creativity much like Legos. However, we’ve never seen a game company with a single title turn into a lasting legacy worth $2.5 billion. The argument is summed up well in his final note:

And I’m sorry, Microsoft, but no one is going to ditch all their other apps and Androids or iPhones for a laughable Windows Phone just to play some special version of Minecraft. If you’re telling yourself that’s why the deal makes sense, your blood-Kool Aid content has surpassed legal levels. Stop drinking it. Kids don’t want Windows Phones. They’re not cool.

You know what is cool? Minecraft. You know what’s an easy way to change that? Have one of the lamest, old-man corporations buy  

Trends in Korea

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Big buyouts are nothing new to the Asian gaming market. SoftBank and GungHo’s $1.53 billion purchase of 51 percent of Supercell based off its success with Clash of Clans is perhaps one of the more notable.  But in Korea massive IPOs from game companies with a single title have been few and far between. SundayToz launched its IPO off the back of Anipang, one of the first titles to hit the KakaoGame platform. The company is currently worth approximately $160 million and its share price rocketed during the first quarter of 2014 on the heels of its IPO.

Other notable companies include DevSisters, the company behind the hit “Cookie Run”, who are gearing up for a an IPO valued at $132 million. PATI Games saw a $20 million injection from Tencent in exchange for a 20% stake in the company earlier this month. Famous for the popular game I Love Coffee, the company is estimated to be worth $100 million. Finally, the flavor of the year 4:33 studios with their game Blade, received $9 million from LB Investments and Korea Investment Partners in May this year, valuing the company at approximately $40-$50 million.

The trend in Korea so far has been far more conservative than the staggering valuations we have seen out of Western companies, and even China and Japan comparatively.

Are these trends a bad omen?

So far, we’ve seen a lot of these IPOs and grandiose valuations cause problems in the industry. As a result, studios have been bought and sold, with people losing their jobs in the wake of poor decisions. But we want to know your thoughts:

Is this type of M&A activity the engine that is going to drive the growth of the game industry, or are we seeing feverish excitement that will ultimately collapse and level off? Is it an overall positive or negative for game developers at the bottom rung of the industry? Leave your comments below!

 

Korea’s Cinderella Law is About to Become a Pumpkin

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shutdown-law-korea

In spite of the fact that South Korea has one of the most vibrant and talented e-sports communities  in the world, the game community has always had a love-hate relationship with government regulators.

Perhaps the most well-known example of this is in the country’s infamous Cinderella Law , set in place to prevent youth from playing online video games after midnight. Also known as the Shut-down law, its implementation in 2010 was mostly a response to fears over video game addiction.

Since most online games require users to sign-up using their government issued identification number (similar to a social security number), the implementation was rather easy. Anyone born after a set date was booted from online games after midnight, and not allowed to play again until 6 AM. But the efficacy of the law has been called into question since its inception.

The results of a 2013 report, for instance, show that children 9 to 14 are still more likely to play online games than mobile, offline PC, or console games.

It has also been relatively easy to skirt the law by using a parent or older siblings ID to create an account (with or without their consent). Realizing this, the Ministry of Gender Equality and Family has called for law to be reformed, stating that most families have been standing on their own values, rather than the government’s, in deciding whether their children are allowed to play video games.

The proposed revisions would come into effect next year, and would allow children to play online video games after midnight, providing they had their parents permission.

[source: Games in Asia]

 

We want to hear your thoughts!

Do government regulations on gaming ever work? What is the best way to handle the potential threat of online gaming addiction?