Archive for November, 2009

Let the games begin – Playdom acquires Green Patch and Trippert Labs

Monday, November 16th, 2009

From the recent actions in the social gaming field, it’s clear to see that a maturation of the industry is afoot. Last week EA announced their acquisition of Playfish, and only days after announcing that they’d raised $43 million in their first funding round, Playdom has put the capital to work and purchased not one, but two social gaming studios – social networking platform games developer Green Patch and iPhone gaming studio Trippert Labs.

Playdom, the largest game developer on MySpace, and one of the larger players on Facebook has been rumored to have purchased the two studios for a while, but chose last week to make the announcement official. While the timing might be slightly suspect, it’s clear that these deals were in the works long before the accrual of the recent round of funding. Both firms were purchased for an undisclosed amount, but remember, in early October, a source within Playdom commented that the company’s “annual revenue is upwards of $50 million.” A sizeable revenue stream no matter what industry you’re looking at. Combining the annual revenues as well as the (almost matching) investment round, and Playdom is looking at some serious buying power.

What’s clear to see from these acquisitions is Playdom’s future goals. iPhone developer Trippert Labs is responsible for titles including Dr. Ito’s Brain Training and The Godfather II Crime Rings. This past summer, Playdom expanded their Gangster type games to the iPhone platform, and it’s clear that the Trippert Labs acquisition is a further investment in the genre. They’ve also got a project in the works that’s been described as “a significant Flash experience.” Trippert Labs CEO Omar Siddiqui will join Playdom in the role of VP of Game Production and joins former EA vet John Pleasants who serves as CEO.

On the social networking platform front, the acquisition of Green Patch can only be seen as a direct challenge to Zynga. Formerly, a mid sized Facebook game developer, Green Patch has grown from the success of their initial offering (lil) Green Patch, and now includes a series of (lil) inspired titles, including (lil) Farm Life – a direct competitor to Zynga’s FarmVille. Clarifying the purchase, Playdom chairman explains to insidesocialgames.com, “We’ve been close to Green Patch since almost the beginning [of the Facebook platform]. We actually work about three blocks from each other. We’re mutual admirers.”

Green Patch founders David King and Ashish Dixit will join Playdom in the roles of Executive Producer of a new game studio and a management role within Playdom’s engineering team, respectively.

“Playdom has aggressive plans to expand our social gaming footprint in 2010. With these acquisitions, we are increasing our cross-promotional power and bringing two talented new game studios into the Playdom family,” said Pleasants.

 

Massive and comScore partner to put real numbers behind in-game advertisements

Friday, November 13th, 2009

In game advertising is still a relatively new medium, but until now, both providers and purchasers of the medium had no concrete measurement tools to gauge effectiveness. There have been a number of one-off studies done, with positive results, but nothing done on a (pardon the pun) Massive scale. Partnering with leading internet metrics and market research firm comScore, Massive Inc., a wholly owned subsidiary of Microsoft Corp., will not be able to measure the firect impact that in-game advertising has on consumer online behavior. Call this a win for advertisers everywhere.

It’s no secret that there’s a very viable market in the gaming market, and Massive is one of the big three providers of IGA. They insert (in most cases) non-intrusive ads on billboards in urban landscapes for example, or slide up ads just above the scoreboard display in Madden – something very similar to what a user would see in this environment, or television broadcast. However, while the ads have shown to be popular and consumer motivators, due to the lack of solid data, and their relative newness, advertisers have still been weary to pull the trigger on launching campaigns.

“We know from 85-plus independently verified post-campaign studies that in-game advertising increases brand engagement,” said JJ Richards, general manager of Massive. “But what we didn’t know was the correlation between in-game ads and consumer action. Through this collaboration with comScore, we will also now be able to measure those consumer actions that result from in-game ads. We think this has the potential to literally ‘change the game’ for both advertisers and publishers who want to improve the effectiveness of their in-game ad efforts.”

The Massive/comScore partnership will now connect the dots between ads that users view vs. the actions they take after seeing said ad. Essentially, the two companies have managed a route that will give an overall picture of action and response from a viewer, without violating end user privacy policies.

The method works as such: Microsoft has a set of gamertags for users on their Xbox Live service. These tags provide game identifications and Microsoft knows the exact campaigns that are running within these games. Likewise, under the same umbrella, Microsoft also has Windows Live login data for Hotmail users. Combine these two together, and Microsoft now has a (more or less) complete picture about any given gamers’ preferences, and which ads they’ve seen and haven’t seen. By utilizing their Anonymous ID technology, Microsoft can then strip away any personal information and assign each user with a unique number.

But that’s only one half of the story. On the other side of the fence, comScore has around two million volunteers that offer up their web habits. If and when these users log into Hotmail or Xbox Live, the path between adding up the dots between what ads these users have seen, and what they do on the web within a specified time period is relatively short. To add an additional level of data security, the anonymous data communications between Microsoft and comScore are in an encrypted environment.

comScore’s preliminary research data using this method indicates that those who were exposed to in-game ads vs. those that had not are 280 percent more likely to visit a TV channel’s web site. The study also showed a 125 percent increase in search queries for a movie rental brand and a 57 percent increase in visits to its website.

The announcement coincides with the second annual Microsoft Advertising Gaming Upfront event in New York City — the only event of its kind that showcases new video game titles from leading game publishers available for brands to connect and engage audiences on the Massive in-game advertising network.

comScore and Massive have submitted this new methodology to the Advertising Research Foundation for validation.

 

Ohai seeks to make social gaming platform not so casual

Thursday, November 12th, 2009

Game developers Ohai have been working on an unnamed project for quite a while now, and yesterday they announced the official title: City of Eternals. A vampire inspired free-to-play title that incorporates social gaming elements, Twitter and Facebook logins, for example, City of Eternals has been in a closed beta for the past two months, and has seen some pretty impressive figures. On average, beta testers, all 10,000 of them play around 65 minutes per day, and log in approximately 10 times per day.

cityofeternalsSo far, the project sounds like any number of popular Facebook games. However, where Ohai seeks to separate itself from the pack is through synchronous play (something that EA recently started exploring with Spore Islands, as well as Tencent’s ‘market research’ project via synchronous gaming). The goal of Ohai is to create a “real” MMORPG within a social gaming platform read:Facebook in a 2D virtual world where users interact via avatars. Sounds like a “real” MMORPG thus far – only the platform has changed.

Set in the Pacific Northwest, and possibly tapping into the current Vampire driven market – i.e. Twilight, Underworld, True Blood, etc., city of New Valencia, the complex storyline currently features over 20 unique missions for players to engage in. As with any MMORPG, players create their characters, customizing looks and clothing. Battles take place in combat zones, and players level up and gain virtual goods through these battles and quest completions. Check off the “real” MMORPG tenets, and enter the social side. Grabbing elements from other popular social games, City of Eternals also incorporates players’ home base, which of course can be decorated with any number of purchaseable virtual items. Players may also grow items to keep or sell, specialize in a trade, and become a member of one of four vampire houses – aka clans. Another social feature adaptation – players may also recruit their real life friends to join their fight and become a member of the main player’s vampire army.

Due to the recent shakeup of virtual goods offers being a scam, Ohai CEO Susan Wu stated in a TechCrunch interview that City of Eternals will not be incorporating ad offers, but will offer a strict ‘cash-only’ virtual currency purchase plan. Something female gamers might not take to. While Ohais, the company’s proprietary virtual currency, may be purchased while playing directly at the City of Eternals website, since the game in build in Flash, it’s possible to embed the game practically anywhere else on the web, thereby opening the door for potential virtual currency sales from just about anywhere. City of Eternals’ current virtual goods catalogue prices range anywhere from $.02 right through to $20.

While the games does not yet have an official Facebook page, Ohai states that it’s on it’s way very soon. They’ve also stated that an iPhone version of the game is currently in the works. While it won’t be “exactly the same”, Ohai states that the iPhone version will still allow users to interact with other players.

Build over the course of only 9 months with a staff of approximately 12 (including only 3 engineers), City of Eternals has the potential to be a true resounding success story, considering the title’s breakneck speed development, and limited resources. And they’ve already got a lot going for them – tapping into the once highly popular vampire genre of Facebook games, exploring the synchronous gaming method that has recently piqued the interest of two gaming giants, as well as creating a genre that seems to have found a place in recent pop culture.

 

New Study: Women competitive, social, brand engaged, loyal casual gamers

Wednesday, November 11th, 2009

There was a time when the term ‘gamer’ held a certain negative connotation to it. Past studies have shown that this once held preconception is vastly different today. With the advent and popularity surrounding casual gaming, the gaming landscape has changed dramatically. Just how dramatically? A new report released by Q Interactive and Social Media World Forum has found that female gamers are highly engaged with brands and virtual currency consumption.

QinteractiveWhile the sample size is still relatively small, approximately 2000, the results are enough to make any marketer or developer of casual games jump for joy. The study found that female gamers are passionate and competitive about Green Patches and Happy Aquariums, and often stock up on virtual currency. The study also found that women are highly engaged in branded virtual goods, and are much more likely to acquire virtual currencies through winning more, or accepting a branded offer, as opposed to paying for it with “real world” money.

“As brands seek relevant and natural ways to shake hands with women via social media, the gaming and application marketplace holds tremendous potential to integrate in a consumer-friendly, meaningful way,” said Matt Wise, President, Q Interactive. “Women seek a partner to support their entertainment, which is exceptionally important given their busy lives.”

A closer look at female gamers

  • 85 percent of those surveyed use five or less games and/or apps regularly, indicating an inclination to be loyal to a handful of favorites; approximately 15 percent regularly invest in six or more games/apps at a time
  • More than half (57 percent) are earning/spending virtual currency daily
  • Introduction to new games and apps rest heavily on word-of-mouth: Nearly three-quarters (74 percent) got involved in a game or app due to “a recommendation” by family or friend or because they “noticed a friend or family member’s score”
  • 95 percent utilize virtual currency primarily to “gift” and/or advance games
  • In interacting with games and apps, 57 percent feel virtual gifting – for example, giving a bag of virtual makeup from Sephora – is as meaningful as real life gifting

How Brands and female gamers interact

  • All but six percent (97 percent) of women prefer to earn virtual currency through either winning more or accepting a branded offer – versus paying for it with “real” money
  • While they game and app quite regularly, only one in ten women have actually used “real” money to purchase virtual currency; of that, 85 percent have spent under $100 in their gaming and aping activities – ever
  • Of women who have signed up for branded offers to get more virtual currency, 67 percent found the offer useful
  • 37 percent of those women chose the branded offers based on “content”; 17 percent went for offers with free products or services

“Applications and games are quickly becoming part of everyone’s daily lives,” said Ian Johnson, Director, Social Media World Forum. “This provides a terrific opportunity for brands to serve as a trusted, valued partner to them. By having a presence in the game and app space, brands get the benefit of reaching an influential consumer set. With the support of brands, advance in games and apps and we’re finding also get information from brands they value.”

 

The shakeup at EA – Acquisitions and Layoffs

Tuesday, November 10th, 2009

Yesterday was a landmark day for games publishing giant EA. Speculation had run wild regarding EA’s interest in acquiring social gaming company Playfish, and yesterday they made the official announcement. Congrats EA. However, within hours of the announcement, the hammer dropped, and EA then announced that it would be laying off 1500 employees.

The Acquisition

Electronic Arts Inc. made the official announcement on November 9 that they had in fact acquired social games maker Playfish for a cash payment of $275 million. EA even went one step further to sweeten the deal but offering an additional $100 million if certain performance benchmarks were met by years end. And….EA threw another $25 million at the deal in equity based agreements with Playfish employees in order to boost company retention. A quick look at the math puts the acquisition at $400 million. $100 million short of half a billion. That’s a lot of virtual goods valuations.

Admittedly, both EA and Playfish have been quite open about the deal, and Playfish is slated to find a new home under the EA interactive umbrella – EA’s branch focused primarily on web and mobile p[rojects.

“Social gaming, with its emphasis on friends and community, is seeing tremendous growth and this is the right time to invest to strengthen our participation in this space,” Barry Cottle, Senior Vice President and General Manager of EA Interactive said. Likewise, Playfish CEO and Co-Founder Kristian Segerstrale sees the deal as a win-win situation, “EA is the ideal opportunity for us to push forward our goals to lead in the social entertainment evolution on a faster and much larger scale.”

And in related news…..the layoffs

The phrase, “Strike the hammer, while the iron is hot” would certainly come to mind in this situation. Only hours after the announcement that EA had acquired Playfish, 1500 EA employees got the pink slip.

RedwoodShoresWhile EA posted record digital revenues of $138 million for Q2 2009 (a 23 percent increase, year-over-year), they’ve decided to batten down the hatches and consolidate their operations – as on the whole the company saw a net loss of $391 million in Q2 2009.

They layoffs will effect EA Redwood Shores (the company’s headquarters), Tiburon, Mythic, and Black Box. Black Box is the home of the Need for Speed development (one that just had great success with Need for Speed:Shift), and Skate titles.

MMO studio (Warhammer Online) Mythic is likely to be hardest hit by the cuts. In a tweet posted by Katherine Pitta, the studio has cut 80 employees, or 40 percent of their workforce.

Tiburon, also effected by the cuts, is primarily responsible for EA’s sports based titles, including Madden NFL.

In light of EA’s announcement of acquiring Playfish, as well as their recent launch of a Facebook version of Spore, it’s safe to say that EA has seriously taken the plunge into social gaming. Scaling back on Racing and Skate games almost makes sense (although I’m surprised EA’s not willing to take a look at the fourth best selling game of all time and taking a social gaming whack at it).

Similarly, Mythic is primarily responsible for the subscription based MMO Warhammer Online, one that’s had it’s own ups and downs over the years. With the current gaming climate making the migration to non-subscription based fees, it’s possible to see the EA logic in this one.

And now for the sports. This one is a bit of a head scratcher. Like them or not, microtransactions within EA’s popular sporting titles have been a success for the company. With Madden NFL continuing to have a fanatical following, and the Tiger Woods golf series expanding it’s catalogue of virtual goods sales, it’s a bit surprising to see a scaling back in this venue.

“EA is performing well, with quality, sales and segment share up so far this year,” said CEO John Riccitiello. “We are making tough calls to cut cost in targeted areas and investing more in our biggest games and digital businesses.”

 

EA moves Spore to Facebook

Monday, November 9th, 2009

Late last week, EA launched the Facebook component of it’s popular Spore franchise. A slimed down version of the full game, Spore Islands is a free-to-play social game that monetizes through the sale of in-game currency, ‘DNA Points’.

sporeislands

DNA points can be used to modify the appearance or stats of a users’ created creature(s). As with many if not all social games, users are not required to purchase in-game currency, as they can earn DNA Points over time as they play the game. However, those that do decide to buy in, can purchase special customizations such as hats, seasonal and holiday themed looks, and other virtual goods.

Staying close to the social gaming premise, Spore Islands gameplay revolves around groups of Facebook friends competing in a “survival of the fittest” battle on individual islands. Users create their creatures, and then release them on an island inhabited by other users’ (within the group) creations. The strongest creations will be the only ones left standing, and thereby winning the round. The ultimate goal of Spore Islands is to release your creations onto as many islands and possible and dominate them all.

Developed by EA Maxis, the creators of the original PC and Mac version of the game, Spore Islands is testing the waters of real-time social gaming, something that Chinese games giant Tencent has recently started investigating. Islands within this version of Spore are persistent, allowing a never ending series of battles, even while the creator/user is not logged into Facebook. Overall status of players creations are tracked based on the creatures performance, as well has reach – how many islands it’s been deployed to.

Since it’s inception, Spore has had a social gaming element in mind, and the transition to a social networking platform was a logical step. And while doing well as a stand alone title, it will be interesting to see how EA fairs in the relatively uncharted waters of social gaming on the worlds largest social network. The stand alone version of Spore has it’s own unique set of competitors, with EA having already established it’s position in this marketplace. Within the Facebook marketplace, EA is now facing stiff competition from players that have already been around the block a few times and have gleaned their own experience. Can EA do the same, even if they are a bit late to the party?

 

Ngmoco acquires iPhone and Facebook game maker Miraphonic

Friday, November 6th, 2009

Late 2009 has been a banner time for games maker ngmoco. Granted, a lot of their success has been leveraged buy Apple giving the green light to microtransactions in free-to-play games on the iPhone, but obviously the ngmoco team had to have a product in the works that would fit this model perfectly – as they did with their recently released Eliminate first person shooter.

epic-pet-wars-sBuilding upon their push for social gaming, ngmoco has made it’s first acquisition, buying out Miraphonic, makers of iPhone and Facebook titles Epic Pet Wars and Epic Soldier Wars.

Announced via twitter from ngmoco CEO Neil Young, “Delighted to announce that Miraphonic, creators of the awesome Epic Pet Wars have been acquired by ngmoco!” No financials of the deal have been disclosed.

Epic Pet Wars is (yet another) virtual animal training and fighting MMO that Miraphonic states has over one million users. Fitting in-line with ngmoco’s strategy, the game is free-to-play/download but monetizes via sales of in-game currency ‘Respect Points’ which are used to purchase virtual goods. Respect points cost anywhere between approx. $1 right through to approximately $40. Miraphonic’s Epic Soldier Wars operates under the same premise.

If ngmoco’s commitment to developing and publishing quality free-to-play/microtransactions monetized social games was in question, this purchase should certainly seal the deal. Clearly, the company’s acquisition of former MySpace SVP of business development, Jason Oberfest, back in September is already starting to pay off. Charged with “negotiating deals to drive revenue and support the launch of innovative new products…”, it’s fair to say that Oberfest can now call his first deal done.

Granted, ngmoco is receiving a bit of press hype as of late, but they’re still swimming in very competitive waters. Social games makers including Zynga and Playfish are still raking in the profits, but it’s good to see an up and coming player in the field, as the next 6-12 months at ngmoco will really put their new business model to the test.

 

Blizzard moves one step closer to microtransactions

Thursday, November 5th, 2009

Blizzard’s worldwide leader in the MMORPG genre, World of Warcraft took one step closer to microtransactions yesterday when they announced the availability of two unique pet companions. These two companions are available for real world money purchase exclusively at the Blizzard World of Warcraft Pet Store.

wow-pets

This new move however isn’t the first real money transaction service we’ve seen been made available by Blizzard. Prior to yesterday’s announcement, the franchise had offered paid realm (server) transfers, name changes, character re-customization, and the newly implemented race and faction change, as well as hinted at ‘some type’ of microtransactions. Add purchasable in-game pets to the roster, and we’re now one step closer to a fully fledged microtransaction revenue generating title. Note, not a free-to-play, microtransaction supported model, but one that utilizes microtransactions as an additional form of income.

As noted with the previous paid services available, and Blizzard’s increasing amount of awarded in-game pets (it seems as though every special holiday event has some type of awarded companion), this move to offering a special paid companion seems like a logical step – but how will the community react? Traditionally, World of Warcraft (WoW) has been the last bastion of the traditional subscription based form of online gaming.

Perhaps anticipating a backlash, and surely studying what others in the free-to-play field are doing and have learned, the official FAQ highlights that the pets will not offer any battle or gameplay benefits, as they are strictly cosmetic enhancements, therein combating the pay-to-pwn theory.

The new introduction is in part a piece from a much larger project Blizzard is working on – converting all accounts to a one singular account; one at battle.net. This conversion to a ‘one account management center’ can only be seen as a way for Blizzard to cross promote it’s products. The deadline for converting accounts is November 12th, and if players convert before this deadline, they receive a special companion pet – for free. Seeding this idea of various pets, again awarded from special holiday events and/or an account conversion has been a brilliant pre-release strategy, getting users into a cosmetic status mindset, and then releasing additional companions available only via a microtransaction purchase. With that said, players that do want to purchase these two new pets may do so only after their WoW account has been converted to a Battle.net account.

At $10 a piece, these exclusive pets may not be viewed as a “micro”transaction, but they do introduce RMT’s into a game that has long stayed away from anything outside server, name, and gender, race and looks options.

The two new pets available are the “Pandaren Monk”, a panda vaguely resembling a Kung Fu Panda character. All Monks purchased between now and years end will have half of the purchase price donated to the Make-a-Wish foundation.

The other (and in my opinion, the one that most players will opt for) is “Lil’ K.T., the Littlest Lich,” a miniature version of the Naxxramas dungeon boss Kel’Thuzad which Blizzard states “has a diabolical laugh” and shoots ice.

So while this move to purchasable in-game pets certainly doesn’t signal a move on Blizzard’s part to make their successful World of Warcraft a free-to-play game anytime soon, it does put them one step closer to incorporating more and more Real Money Transaction based purchases into a traditionally, pay for your play time and you’re done, style play.

 

Funcom lands grant to develop free-to-play snowboard title

Wednesday, November 4th, 2009

As odd as it may sound, Norwegian games developer Funcom has recently been bestowed with a $260,000 (NOK 1.5 million) grant to develop an online winter sports title. Awarded by the Norsk Filminstitutt to develop On the Edge of the World, the grant aims to raise awareness and promote Norwegian winter sports. First on tap – snowboarding.

According to the Norsk Filminstitutt’s site (in Norwegian), the title will be a free-to-play game, playable on both Mac and PC, and has a projected prototype delivery date of December 31, 2010. And while snowboarding will be the first focus of On the Edge of the World, the Filminstitutt indeally wants a highly modular platform whereby various Norwegian winter sports can be represented (Alpine skiing, cross country skiing, etc.). With a projected total development cost of around $1 million, this influx of $260k means that the Norsk Filminstitutt’s grant will cover over a quarter of the development costs. Something the struggling Funcom could certainly use.

Slated to be directed by experience Funcom employee Jørgen Tharaldsen (Product Director for Age of Conan: Hyborian Adventures), On the Edge of the World should also have cross media features that should be able to translate to film, television and the sports featured in the game.

As we’ve seen over the past year, Funcom, the one time heavily into massive games with their associated payment options, is, be it it’s own choice or not, slowly morphing into a free-to-play development studio. Back in May, buried amidst a ‘things are looking better….really…they are” report about the state of Age of Conan, Funcom slipped in that they’re also working on two separate free-to-play titles, each aimed at a unique demographic. Fast forward nine months, and they’re not working on another free-to-play? And this time with a grant from the Norwegian government?

Which brings to mind another issue. Wasn’t Funcom the developer that recently let 20 percent of it’s staff members go, while encouraging those remaining to move to it’s Quebec, Canada studios? Does that now mean those 20 percent might have their job back? Does that mean that the Norwegian government is literally trying to buy Funcom into staying in Norway? And with an annual loss of $34 million in 2008, can Funcom actually deliver?

 

Ngmoco’s free-to-play/microtransactions supported iPhone game Eliminate now available

Tuesday, November 3rd, 2009

Ever since Apple gave the green light to microtransaction purchases via free games, developers have been scrambling to cash in on the monetization model. Not surprisingly, Ngmoco, who had already been developing a new FPS title quickly announced that they’d take the plunge, and decided to put Eliminate first on the scene with a free-to-play, free to download, microtransaction supported game.

That day has arrived, as Eliminate is now available on the App Store. As shown in the video below, the 3D game play is quite developed, especially for an iPhone game, and a free one at that. Collaborative play can be done on both wi-fi and 3G networks, and players earn credits as they level up. These credits are the gateway to better weapons and gear. Credits are purchased through in-game ‘energy’ that’s gained through play. However, and here’s the sell, players may only gain a certain amount of energy per day. If they want to continue play, they have the option to purchase additional energy. Players may wait another day to continue their fragging, as the clock resets every 24 hours, but Ngmoco is banking (literally) on players being so engaged in game play that they’ll want to purchase additional enegery.

Part of this driving strategy is utilization of Ngmoco’s own Plus+ social interface which tracks leaderboards and accounts. In other words, top players will undoubtedly be those that play the most. And in order to play the most – they’ll no doubt be purchasing energy via the newly approved Apple store microtransactions for free titles. Additionally, utilizing the OS3.0 technology, Eliminate players can ‘push’ challenges to friends and set up battles at the touch of a button. And really…who wants to be the guy that can’t join the game because he’s used up his ‘energy’ for the day. Yet another opportunity for a microtransaction purchase.

“We are very excited to offer the Eliminate experience as a free download for all iPhone and iPod touch gamers,” said Neil Young, CEO & founder of ngmoco. “The intense multiplayer action is complemented extremely well by a unique leveling and upgrading system plus our online matchmaking service ensures players of similar skill will be matched on our global servers.”