Gamers vs Screen, Fresh Facts, Trends & Opportunities

Berlin, Think Gaming, June 2012 Peter Warman, CEO Newzoo

Gamers vs Screens Fresh Facts, Trends & Opportunities games market research

Today is not about fußball Well, maybe a little bit … games market research

Festival of Games 2012

Why are we here today? Amidst all the change, where to go now? games market research

games market research

Why is that? What has changed?

Festival of Games 2012

What has changed? The road to success has

2002

Festival of Games 2012

games market research

What has changed? The road to success has

2008

Festival of Games 2012

games market research

What has changed? The road to success has

2012

Festival of Games 2012

games market research

Game Company

“Oh no! What to do

next?”

Nice. Endless Possibilities! Actually, that is the problem.

Investor “Oh no! What am I investing in?”

Festival of Games 2012

games market research

Oh no! I need a guide

Nice. Endless Possibilities! Actually, that is the problem. games market research

Nice. Endless Possibilities! I need a guide through the new galaxy… games market research

Nice. Endless Possibilities! I need a guide through the new galaxy… games market research

games market research

Nice. Endless Possibilities! I need a guide through the new galaxy… games market research

games market research

US UK Germany France Spain Netherlands Belgium Italy Brazil Mexico Russia China Korea

research portfolio

Turkey Poland

Newwho? Global intelligence. Global clients. games market research

Newwho? Breaking news: Wizards & Newzoo games market research

Market Insights Market sizing with whales games market research

6% of 3.8M Germans that like SciFi MMO games and spend money in F2P MMO games spends more than 50 euro a month on MMO games: 230,000 Germans.

120,000 230,000 105,000 11,000 12,000 100,000 43,000

Share of SciFi paying F2P MMO gamers that spend over 50 euro per month

Source: 2012 Newzoo Data Explorer

Market Insights Marketing partners / Prepaid potential games market research

66% of 3.9M Farmerama players in Germany frequently go to Lidl: 2.6M Germans (vs 1.9M Farmville players)

Source: 2012 Newzoo Data Explorer

Popularity of retail chains amongst Farmerama and Farmville players

Market Insights Marketing partners / Prepaid potential games market research

Platform TargetPayers TotalPayersinM %ofgamersreachedperplatform

Mobile 19.9 36.7 54,22%

Console 28.6 60.6 47,19%Casual 11.2 24.2 46,28%

PC/MAC 16.6 36.8 45,11%Social 9.7 18.9 51,32%

MMO 10.9 23.0 47,39%

Of all 22.6M (of 49.7M in all US) MMO gamers that frequently visits Target, 48% spends money on MMO games: 10.9M people representing approx 23% of $2.4bn MMO spend: $550M

Source: 2012 Newzoo Data Explorer

Market Insights Cross-platform/screen potential games market research

650,000 9,000,000

50% of US Farmerama players actively use an iPad versus 16% for Farmville players

Source: 2012 Newzoo Data Explorer

Active use of iPad amongst US players for several key frachise gamers

League of Legends best scoring MMO

Turkey Poland

11.8M Gamers 53% spends money

$350-450M*

*2012 estimate. Further analysis underway.

Money Money

Time

*For time spend PC/Mac boxed and downloaded are one.

9%

9%

10%

8% 8%

21% 24%

12%

15%

11%

18% 25%

18%

12%

21%

17%

12% 16%

10%

24%** 14%

23%

15% 13%

12%

23%**

Time

launch sponsor

fresh 2012 data

Market Insights Emerging Markets games market research

21.8M Gamers 52% spends money

$400-500M*

Market Data The basics games market research

11% of paying console & PC gamers buy online abroad most of the time or always: 1,700,000 Germans. Another 10% buys them physically abroad.

Market Data The basics games market research

Market Data The basics games market research

Market Data The basics games market research

36% of console gamers never spend money on console games 45% of PC/Mac gamers

36% of console gamers never spend money on console games 45% of PC/Mac gamers

43% of console gamers never spend money on console games 61% of PC/Mac gamers

Market Data The basics games market research

So, what is happening? A real revolution! Multiple changes coincide.

2002 “Games are

Paid Products” (yes, including console games, remember almost 50% never spends money!)

2012 “Games are Free Services”

Festival of Games 2012

games market research

An example What games are these?

Infinity Blade – Epic Games The global example for core game

sucess on mobile

Festival of Games 2012

games market research

An example What games are these?

Infinity Blade – Epic Games The global example for core game

sucess on mobile

games market research

An example What games are these?

Infinity Blade – Epic Games The global example for core game

sucess on mobile

Lords & Knights – Xyrality Hardly known by US/Global press and

investors

games market research

An example What games are these?

Infinity Blade – Epic Games The global example for core game

sucess on mobile

Lords & Knights – Xyrality Hardly known by US/Global press and

investors

games market research

An example What games are these?

Infinity Blade – Epic Games The global example for core game

sucess on mobile

Lords & Knights – Xyrality Hardly known by US/Global press and

investors

PAID FREE

games market research

An example What games are these?

February 2012 – US + EU aggr.

iPad Gross Rank: 44 (19) iPhone Gross Rank: 26 (16)

PAID FREE February 2012 – US + EU aggr.

iPad Gross Rank: 6 (9) iPhone Gross Rank: 6 (11)

games market research

An example What games are these?

February 2012 – US + EU aggr.

iPad Gross Rank: 44 (19) iPhone Gross Rank: 26 (16)

$1X $2.5X February 2012 – US + EU aggr.

iPad Gross Rank: 6 (9) iPhone Gross Rank: 6 (11)

in-game revs in-game revs

games market research

Mid-Core Gaming The current/next big thing?

April 19 2012 - US.

iPad Gross Rank: 2 (new) iPhone Gross Rank: 1 (new)

Festival of Games 2012

Kingdoms of Camelot – Kabam

The core social game giant does it again. On mobile this time.

games market research

Sneak preview of worlds largest game publisher in 2020 games market research

Festival of Games 2012

games market research

Sneak preview of the view out of the window in 2020

What about the furure? Enough about the past and here & now… games market research

Global Growth & Mass audience

The global games market is growing with >10% in terms of spending and >25% per year in terms of number of consumers and time spent. 60% of the population in Western territories plays games, evenly split in age and gender. Emerging markets are fueling global growth.

Games as Services & New Business Models

Boxed game sales are going down fast with >25% per year. Online connectivity and successful monetization of free-to-play games have led to games being viewed and managed as services that are continuously improved and extended.

Cross-Screen Gaming & Connected TVs

As all games move towards the cloud, game platforms become less relevant. Now it is about games as brands and providing access to games through one or more screens surrounding a consumer. The big (TV) screen, traditionally ruled by consoles is now the new battlefield.

Competition & Consolidation

The huge changes in the market lead to big losses (TakeTwo, Nintendo, Sony) as well as enormous growth (Zynga, Wargaming). Online and mobile gaming has quickly become very competitive boosting marketing spend and M&A activity.

games market research

We could leave you by simply writing up

Key Trends…

What about the furure? From Market Data to Insights to Intelligence games market research

there will always be

Consumers games market research

games market research

there will always be

Screens

games market research

people will always want

Fun

games market research

everything (and everyone) ends up in the

Cloud

games market research

when things get too complex, focus on:

Consumers

social networks

the real world

the cloud

Fun (Your Brand)

personal screen

entertainment screen

floating screen

computer screen

games market research

social networks

the real world

the cloud

Fun (Your Brand)

personal screen

entertainment screen

floating screen

computer screen

Social Netw. ($1.8bn) Casual websites ($2.8bn) MMOs ($2.6bn) PC/Mac Boxed ($1.8bn) PC/Mac Downl. ($2.5bn) Total: $11.5bn 53%

Console Boxed ($5.7bn) Console DLC ($0.8bn)

TV Apps (n.a.) Total: $6.5bn

30%

Handh. Console ($1.5bn) Tablets ($0.7bn)

Total: $2.2bn 10%

Smartphones ($1.4bn) (incl. iPod) Total: $1.4bn 7%

US | 2011 Total: $21.5bn

games market research

games market research

Lets zoom in on an

European Gamers vs Screens

Find infographics on newzoo.com.

Players

Time

Payers

Money

games market research

Lets zoom in on an

European Gamers vs Screens

Only

14% of game time

is spent on TV

games market research

Lets zoom in on an

European Gamers vs Screens

The Computer Screen

is well balanced and easily the

biggest with 50%

of money but pretty close to max

potential

games market research

Lets zoom in on an

European Gamers vs Screens

The Personal Screen attracts almost as many players and

time as the Entertainment

Screen.

32% of paying

gamers also spends on Personal Screen

games market research

Lets zoom in on an

European Gamers vs Screens

PER SCREEN:

50% of users actively plays games

Work in progress: Theories sizing growth

games market research

Lets zoom in on an

European Gamers vs Screens

games market research

Lets zoom in on an

European Gamers vs Screens

games market research

you are building brands, and big brands…

are Accesible via all screens

3.

In the end its all about

Making a F…. Good Game!

May the force be with you! games market research

peter@newzoo.com

games market research

This is the coolest industry to be in. Let’s have

Fun!