Posts Tagged ‘PlayFish’

Playfish/EA exec Xavier Louis headed to MXP4

Wednesday, January 12th, 2011

Adding another feather in the long-running, “Where is all the talent going?” cap over at EA, former Playfish executive Xavier Louis will be joining the MXP4 team in the role of Vice President of Product Marketing. With Playfish, he served as Product Marketing Director. With MXP4, Louis is expected to drive adoption of and monetization of the company’s interactive social-music gaming technology.

“We are elated to have an industry expert like Xavier join MXP4,” commented Albin Serviant, CEO of MXP4. “With his extensive social gaming experience, he is an obvious choice to spearhead the continued development of our interactive music games.”

If you’re not already familiar with MXP4’s program, they’re turning music into casual games. The goal is to pull passive music listeners (i.e., all of us) and convert them into active users who are inclined to share (read: distribute) their music preferences, and ultimately make more music purchases. Through this mechanism MXP4 offers value to both artists and marketers, all the while, providing a fun and engaging experience for end users. You might remember the company’s beta launch, featuring PUMP IT!, a Facebook game revolving around hit artist David Guetta’s single “Who’s that Chick.” The title garnered over half a million visits to the application, with users playing the game for more than 15 minutes per track. Of these 500,000 or so users, 50 percent of them ended up sharing this music and competing against social network friends, with some users player more than 500 times in a chance to win a meet-n-greet with Guetta himself.

“I am looking forward to applying my years of experience in social gaming to help forge the future of the nascent ‘social music gaming’ genre,” commented Xavier Louis. “MXP4’s mission is truly unique, and I am excited to join such a visionary team.”

Since the arrival and death of music based games, i.e. Guitar Hero, we’ve yet to see a hard look at games and music, and how they can be capitalized upon in the massive social gaming market. It appears as though MXP4 is staring straight down the barrel of this loaded gun, and taking aim. The tech looks good, and I’d wager with a few more key promotions such as the Guetta deal, MXP4 could be the breakout story of 2011. Let’s see if Louis can work his former Playfish magic with MXP4. If so…hold on to your hats, as there’s a lot of tunes-based play ahead.

 

EA signs exclusive 5 year deal with Facebook Credits

Friday, November 5th, 2010

Electronic Arts has recently announced that they’ve signed an exclusive 5 year deal with social networking platform Facebook to solely use Facebook Credits as it’s payment method.

You’ll remember that as part of the Playfish acquisition, EA now counts “Pet Society” and “Restaurant City” in it’s storehouse of games. These two rank in the top 10 games played on a daily basis on Facebook. EA has more recently launched popular football and soccer themed titles, and intentionally or not, Playfish COO Sebastien De Halleux casually mentioned that the timeless classic, “Monopoly” would soon receive the social treatment.

“Since gaming has emerged as the most popular category of applications on Facebook, the natural next step is for EA to broaden our relationship with Facebook and its 500 million users,” comments Barry Cottle, EA Interactive’s senior vice president and general manager. “Our goal is to make the best games tailored specifically to the platforms on which people want to play.”

According to the terms of the agreement, and similar to many other microtransactions based agreements today, EA will receive 70 percent of all sales, with Facebook taking home 30 percent. Considering the recent words from Facebook, and their push to make the platform more “developer friendly,”it looks like EA could be on the winning side of this agreement. Now, as long as they can avoid getting caught passing UID information along, they should remain in Facebook’s favor.

“We are pleased to enter into this long-term partnership with EA to make it easier for people to purchase virtual goods across some of the most popular games on Facebook,” Dan Rose, Facebook’s vice president of partnerships and platform marketing, said in the release. “Playfish has a great reputation for building high-quality games on Facebook, and we look forward to working even more closely with them and the larger team at EA.”

 

Social gaming attracts frequent players – few whales

Monday, June 28th, 2010

In a recent survey conduct by the Inside Network, 90 percent of the 1800 social gamers polled indicated that they play their favorite title at least once a day.

28 percent said that they played at least once a day, with the majority, 62 percent, of social gamers coming back several times a day. Not surprisingly, the Facebook king of social gaming of the moment, Zynga’s FarmVille received the most amount of attention, with more than half of respondents saying that they play it everyday. Other strong contenders in the play-now, play-often category are Playdom’s Social City, Playfish’s Pet Society, and Zynga’s Café World.

When it comes to with whom they’re playing, the majority, 55.5 percent, of social gamers play with their friends. 15.4 percent play with classmates, and 9.6 percent play with co-workers. Interestingly, around a quarter, 19.5 percent, of all social gamers play with strangers. Ultimately, this 19.5 percent figure indicates a trust and confidence in the social networking platform.

And while this deep and frequent interaction can be measured as a sign of a hit title, at the end of the day, a hit is only a hit for developers and publishers if there’s some revenue rolling in to foot the bill. Enter stage left – the “Whales”.

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The whales are a topic that’s been surfacing a bit as of late, and they serve an interesting purpose and place in today’s social gaming world. A whale is defined as a free-to-play/social gaming player that spends $25 or more per month on a product that is otherwise free to play, should they so choose. It’s these folks that the social gaming industry is building upon. While only 2 percent of the survey respondents admitted to spending upwards of $25/month on social games, the majority of those respondents indicated that their spending was focused on only one game, suggesting that these whales are not so much in love with social gaming in general, but rather, are developing a deep and (financially) meaningful relationship with one game. On the other side of that coin, 0.1 percent said that they spend $25 or more a month on eight separate social games – so there are at least a few players out there that like to spread the money around.

“If 2009 is remembered as the year that casual gaming stormed social platforms, 2010 is quickly becoming the year that the industry started to mature,” comments survey co-author Justin Smith

 

Zynga. Worth $5 billion?

Wednesday, April 7th, 2010

If you’re a social gamer, i.e. one who regularly plays free-to-play games in short doses, most probably on Facebook, chances are you’ve come across a Zynga game or two (or 6 out of the top 7 games). And while we know that Zynga certainly has a valuation on not only their properties, but the company itself, I’m not quite sure anyone would have guessed that this valuation would be in the $5 Billion range. This figure is according to an investment report issued by investment news blog Second Shares yesterday.

zynga_MAUWhile Zynga has no short term plans to go public (at least that we know about), industry analysts Jay Gould, Lou Kerner, and Bill Auslander estimate that if Zynga were to go public tomorrow, shares would trade around the $15.75 per share mark. This estimate is determined based on a multitude of factors, one of which being the price that current Zynga employees could fetch on the secondary market by selling their stock options.

Keep in mind – these estimates are conceived through complex financial projects and mathematical computations. I’m not going to use the word, but it should have already occurred to you where you might have heard this terminology before (can you say derivatives?).

However, financial wizardry aside, the Second Shares report highlights that Zynga is clearly leading the social gaming industry. Their MAU (Monthly Active Users) clocks in a massive 237 million, with the nearest competitor, EA via their purchase of Playfish, hits the finish line with a respectable 53 million, but still dwarfed by Zynga. The only other player mentioned that is significantly larger than Zynga is Chinese firm Tencent Holdings with an MAU of 400 million. As a reminder…Tencent is testing the Facebook waters.

Naturally, with a number this big, there’s bound to be a few folks scratching their heads, and asking…Why? How? Etc…Notably, LOLapps CEO Kavin Stewart has suggested that Zynga artificially inflates it’s MAU numbers by counting the same user over multiple applications. For instance, the Second Shares report specifically points out that Zynga receives 15 MAU from the FarmVille.com, indicating that the MAU may not be a proper valuation based on a single platform.

Building on this theme, while the report considers Zynga a strong investment opportunity, it does highlight some of the risks involved. Currently, Second Shares says that 50 percent of Zynga’s revenues are generated from one title: FarmVille. As well, 35 percent of Zynga’s MAU is generated from FarmVille alone. And adding to this house of cards, Second Shares also points out that users use FarmVille 50 percent more than any other title.

As a veteran of the first dot-com boom, I can only think of one very valuable token of advice bestowed upon us from the venerable and wise writers of Battlestar Galactica, “All of this has happened before, and all of this will happen again.”

 

Open Feint launches social features for free-to-play iPhone games

Thursday, February 18th, 2010

Announced late yesterday, Burlingame, CA based Aurora Feint officially opened their private beta of OpenFeint X, a solution for developers to have the ability to create free-to-play games, including those stocked with microtransaction based virtual goods. The company positions the product as a logical adoption, given the runaway success of free-to-play games on social networking platforms.

openFeint_logo“OpenFeint X is by far our most ambitious and transformative effort,” said Jason Citron, Founder and CEO of Aurora Feint Inc. “We know that there is tremendous interest in creating the next Zynga, CrowdStar, and PlayFish of the iPhone. We also know that developers who aspire to these ambitions want the platform on which they can build these kinds of lucrative businesses. OpenFeint X is exactly that platform.”

Launched in conjunction with strategic partner DeNa Group, OpenFeint X will be rolled out in phases over the coming months. Core services of OpenFeint X will be fee to developers. The up side to using Aurora Feint’s toolkit is the exponential exposure devs will gain from the community. Social features include a chat wall, similar to Facebook, a newsfeed showing recent in-game activity, and game nudges, again all taken from the Facebook platform page here. Most notably, OpenFeint X includes tools for developers to fully integrate a full virtual goods store, detailed analytics, a game-specific currency, and downloadable game assets.

“OpenFeint X is the culmination of bringing the best of Xbox Live and Facebook’s App Platform to the iPhone, and extending the multi-billion dollar virtual goods social gaming economy to mobile,” said Peter Relan, Executive Chairman of Aurora Feint. Relan also holds the same position at CrowdStar, the #2 Social Game developer on Facebook, which makes huge hits such as Happy Aquarium, Happy Island and Happy Pets.

Relan concludes, “OpenFeint X is the platform on which the next big social gaming companies will be created.”

The existing OpenFeint platform currently powers social gaming services for over 12 million users, and has a monthly growth rate of 25%.

 

Tap Tap ka-ching! Tapulous pulls down over $1m per month

Tuesday, December 22nd, 2009

It’s a fair statement to make that developers of successful iPhone apps stand to make a pretty penny. Until now, it’s not been known just how big that penny may be. Recently, iPhone app developer Tapulous stated that they’re approaching $1 million in sales per month.

Tapulous CEO Bart Decrem

Tapulous CEO Bart Decrem

Based in Palo Alto, CA., Tapulous is staffed by a mere 20 people, and has had a string of hits, most notably “Tap Tap Revenge”. This title alone has been installed over 20 million times, and clocks a hefty 600 million total games played. And if these massive numbers weren’t enough, earlier this year comScore reported that “Tap Tap Revenge” has been installed by one-third of all Apple app users, iPhone and iPod Touch combined.

The companies’ newest iteration, “Tap Tap Revenge 3” costs only $1 from the App Store. The company employs a successful microtransaction business model to garner the $1 million per month in sales. Players have the option to download additional songs for the game from major artists for $.50 a piece. In addition, Tapulous also generates revenue through in-game advertising spots.

This new figure highlights the growing importance (as well as Apple focus) of the iPhone and/or iPod Touch as a gaming platform, as well as the App Store itself. Bart Decrem, CEO of Tapulous said that he expects the company to ride the wave of “exponential growth” in mobile app commerce in the coming years. “It’s going to be big and all of a sudden people are going to say, ‘Holy cow, where did those guys come from?’,” he said. Given these recent sales numbers, the day may have already arrived.

As we’ve seen over the past year, social gaming on the iPhone and iPod Touch has exploded with Zynga, Playdom, and Playfish all garnering massive exposure, downloads, and associated revenue. With Playfish being acquired by EA for $275 million this year, Playdom generating $50 million in annual revenue, and Zynga’s juggernaut seemingly unstoppable, Tapulous’ stock (figuratively, not literally) in the social gaming space just shot up 10 fold.

With Christmas just around the corner, Apple is expecting a boost to it’s already healthy iPhone and iPod Touch sales numbers. Apple claims over 50 million devices in circulation already, and since launching the App Store in July 2008, users have already downloaded over two billion applications.

 

Third largest social games maker Playdom will see $50M in revenues this year

Friday, December 18th, 2009

The third largest player in the social games space, Playdom is expecting a profitable year with $50 million in revenues expected. In an interview with ThinkEquity’s Atul Bagga, Playdom CEO John Pleasant confirmed that the company is profitable, and 2009 will see over $50 million in revenues. This statement falls right in line with last October’s leaked data regarding Playdom’s revenue numbers.

The social gaming company of the year award might land with Playfish, as their acquisition by traditional gaming giant logged over $300 million. In second place, at least in the revenues department, Zynga, with their recent $180 million from Russian investor Digital Sky Technologies alone puts them in second place. Not to be outdone, Playdom’s $50 million places them strongly in third place.

And now for the numbers…

Pleasant, who left Playdom his COO position at EA earlier this year to head up Playdom, stated that three-quarters, or $37.5 million, of Playdom’s revenues are generated from virtual goods sales. Given the on going ‘scamville’ fiasco, Playdom treads on some thin ice with 15 percent of it’s revenues being generated from third party advertisers who offer users marketing “offers” in exchange for virtual goods that are rewarded after a users completes a survey or related activity. The remaining 10 percent comes from advertising deals.

Bagga’s report states that Playdom currently cites 28 million monthly active users. In comparison, EA/Playfish has 50 million users on board, and the top dog, Zynga, reports that they have 200 million active monthly users. However, the measure of “monthly active users” does span the gap across multiple titles from the same producer. When seen in this light, Zynga reports 100 million monthly uniques.

But where’s the disconnect here? Both Zynga and Playfish have been making a killing. That’s not to say that Playdom’s $50 million is a paltry figure, but still hovering in the double digit range, while it’s closest competitors are a decent way into the three figure digits. The missing link? Facebook. When looking at Playdom’s platform distribution, 60 percent is played on MySpace, while 40 percent is focused on Facebook. After receiving $43 million last month in a most recent funding round, Playdom execs state that they plan to double the number of it’s current offerings in 2010. The question is – will they ramp up offerings on the much hotter social gaming platform Facebook?

 

Another day, another boatload of $$ for Zynga

Wednesday, December 16th, 2009

Social game leader of the pack Zynga has recently landed yet another influx of cash. This time however, the majority of the investment is coming from Russian investor Digital Sky Technologies. If this name sounds vaguely familiar, you might remember them as a $200 million investor in Facebook. They’re also the same firm that we covered less than a month ago with their $5 million investment in a homegrown social strategy game and gaming platform.

logo_zyngaIf you’ve not been keeping score, and admittedly in this blister paced market, it can be quite a challenge, Zynga is currently the king of social gaming on Facebook. They’re the makers of FarmVille, arguably the one that started the farming craze, which launced in June and counts 72.9 million active monthly users. And while this number alone is enough to make any investor sit up and take notice, Zynga also stables Mafia Wars, FishVille, YoVille, Café World, and Texas HoldEm Poker. Combined, Zynga’s active monthly usage amounts to a massive 232 million. To put that in perspective, there are only three countries on the planet (China, India, and the United States) that are larger.

Looking at Zynga in the overall social gaming space, again, they’re clearling leading the pack. The second largest player on the Facebook gaming page is Playfish, which counts 59 million users. Obviously nothing to sneeze at, but when compared to Zynga – peanuts. Playfish was recently acquired by EA, as the traditional games giant is seeking to make a shift towards current market preferences.

And while massive numbers are good, many, if not all, investors in social gaming have recollections of a former internet boom that was fueled by views, and never bothered to look at the solid bottom line. Fast forward 10 (or so) years, and it looks like both investors and startups have learned a lesson. Zynga is not only covering their costs, but bringing home the bacon – in loads. While on paper, it seems like free-to-play gaming in general wouldn’t make sense. Giving games away and waiting for players to make a microtransaction purchase wouldn’t have been a solid solution pre-social gaming explosion days. However, rumors are circulating that Zynga’s 2009 revenues are pushing the $250 million mark. The company employs either full time or part time 712 employees and is constantly growing.

Again, these figures are enough to make any investor take notice, and it’s clear that Russian firm Digital Sky Technologies is clearly putting it’s vote of confidence into the social networking/gaming area.

With respect to the new investment, Zynga’s founder and CEO Mark Pincus commented to the New York Times, “The opportunity every quarter is proving to be bigger than we imagined and we always thought it was prudent to keep adding to the capital of the company as we grow.”

 

EA chief Riccitiello – “Digital market will be bigger than consoles next year”

Thursday, December 3rd, 2009

In a recent interview with Reuters news service, Electronic Arts CEO John Riccitiello managed to put a positive spin on the relatively dreary Thanksgiving and Christmas season games sales thus far, and managed to drop a relative industry bombshell…all within the same interview.

RiccitielloWhat makes the statement remarkable, is that Riccitiello sits as the man in charge of the world’s largest video game developer – a firm that’s traditionally focused on pricey, glossy boxed, console focused games. However, Riccitiello took the interview time to point out that projects have been afoot at EA for a while now, almost predicting the coming tide.

“A couple of years ago EA embarked on a plan to really build itself up in this new frontier. In the last quarter alone we did $138 million in revenue and if EA’s digital business were a stand alone company it would be the darling of Wall Street,” Riccitiello said.

He also went on to tell Reuters that consumers often forget about online browser based games including social games often found on Facebook, as well as MMO’s such as Warhammer Online, subscription and microtransaction based games, and claimed that this sector is now, “almost half the industry now. It’s about 40-45 percent. Next year it’s likely to have a larger share in the entire industry, bigger than all the console games put together.”

And as we’ve previously speculated – EA’s recent acquisition of social gaming company Playfish is just a further move towards dominating the digital front, as it has done successfully with the brick and mortar storefront. “It’s an on-purpose transformation,” Riccitiello says. “We’re trying to become a company that looks more like a direct-to-consumer business.”

With this announcement, it might be easy to say, ‘but wait…what about console gamers – are they being abandoned?’ Not at all according to Riccitiello. He notes that his optimism towards new models should not be seen as pessimism towards existing models. “We intend to be the number one packaged goods publisher in the world,” he says.

 

RockYou scores another $50 million

Wednesday, November 18th, 2009

After passing on an intial offer to be bought out by EA (who eventually went with Playfish as their social gaming acquisition), Redwood City, California based RockYou has recently secured an additional $50 million in series D funding. This recent influx of cash was lead by SoftBank. The news funds are expected to further enhance RockYou’s current offerings and expand development, boost global brand, as well as create products that are ripe for in-game advertising possibilities.

Currently the largest independent ad network in the social media field, with more than 213 million monthly unique visitors, the company logs over 15 billion monthly impressions. Since it’s inception in November 2005, RockYou (originally called RockMySpace) specializes in providing marketers unique and industry leading solutions to reach specific market segments. Primarily focused on widgets and social applications, RockYou has commented that with this new round of funding they will also begin venturing into the currently rather risky waters of in-game offers, i.e. the Scamville affair.

“RockYou has been an innovator in the social media industry since our launch more than four years ago, and we are excited to expand our relationship with SoftBank with this round of funding,” said Lance Tokuda, co-founder and CEO, RockYou. “In 2009, RockYou is on target to triple our revenue from the previous fiscal year, demonstrating our continued growth in the space.”

With rumored revenues in the $30 – $40 million per year range, if Tokuda’s statement is on track, RockYou is well within the revenues range of major players including Zynga and PlayEAfish.

This latest round of funding brings RockYou’s combined total raised to a healthy $118 million. This round D funding effectively doubles what previous round C had netted – $52 million from SoftBank and SK Telecom Ventures this time last year. In addition to SoftBank and SK Telecom Ventures, Rockyou’s finding arrives via Sequoia Capital, Partech International, Lightspeed Venture Partners, and DCM.