Can your game make millions in Asia? If 1% of Asians would pay a $1! This presentation is a bit of a reality check given for Yetizen given in May 2012 in San Francisco.

1. The
Gaming
guide
to
Big
in
Asia
Misconcep3ons
&
Reali3es
@benjaminjoffe
ceo,
+8*

2. @benjaminjoffe

3. 100+ Keynotes in 20 Countries!

4. Startup Mentor!

5. Investor in Global Startups from Asia!

6. CEO of +8* | Research & Market Entry to Asia!
EUROPE
USA
ASIA

7. 12 years abroad – my cultural DNA!
I
spent
most
of
my
working
life
(11
years)
overseas,
especially
in
Japan,
China,
South
Korea
and
USA.
My
cultural
DNA
has
become
rather
complex.

8. Asia!
This is Asia!

9. But “Asia” does not cover the diversity!

10. China
Japan
South
Korea
Singapore
Indonesia
…
Russia
Turkey
…
48
Countries!
48 countries with major differences!

11. “Asia
was
a
concept
of
Western
CivilizaEon.”
This is probably the best definition of Asia!

12. There
is
no
Asia
• GDP
• GDP/capita
• Demographics
• Language(s)
• Religion(s)
• Web
&
Mobile
Infrastructures
• Dominant
Players
• Payment
systems
Just consider the radical differences…!

13. To give some perspective: view from Taiwan!

14. …with translation!

15. “Just
by
going
to
China,
we
could
double
the
audience,”
– Peter
Relan,
CEO,
Crowdstar
Doubling audience is not doubling revenue!

16. 4 Asian countries in top 10? How big are they?!

17. Country
PopulaEon
GDP/Capita
(USD)
China
1.3
billion
4,500
Japan
128
million
42,000
South
Korea
49
million
20,000
Taiwan
23
million
20,000
Hong
Kong
7
million
32,000
Singapore
5
million
57,000
Malaysia
28
million
9,500
Indonesia
240
million
3,900
Vietnam
90
million
1,500
Philippines
94
million
2,500
Thailand
65
million
5,800
North
Korea
24
million
1,000
Not all markets are created equal!

18. Country
PopulaEon
GDP/Capita
(USD)
China
1.3
billion
4,500
Japan
128
million
42,000
South
Korea
49
million
20,000
Taiwan
23
million
20,000
Hong
Kong
7
million
32,000
Singapore
5
million
57,000
Malaysia
28
million
9,500
Indonesia
240
million
3,900
- 1 user in Japan is possibly worth 101,500
Vietnam
90
million
in
ChinaPhilippines
in terms of monetization
94
million
2,500
Thailand
65
million
5,800
North
Korea
24
million
1,000
- HK, SG and Malaysia are smaller but quite
decent medium-sized markets!

19. Country
PopulaEon
GDP/Capita
(USD)
China
1.3
billion
4,500
Japan
128
million
42,000
On the contrary, the million
South
Korea
49
countries below are
20,000
going to be hard to monetize due 20,000
Taiwan
23
million
to low
Hong
Kong
7
million
32,000
GDP/capita.!
Singapore
5
million
57,000
Malaysia
28
million
9,500
Indonesia
240
million
3,900
Vietnam
90
million
1,500
Philippines
94
million
2,500
Thailand
65
million
5,800
North
Korea
24
million
1,000
4 Asian countries in top 10? How big are they?!

20. Mobile
Users
China
Japan
Korea
Total
1.02
billion
127
million
50
million
Android
?
15
million
17
million
(es3mates)
iPhone
<20
million
<10
million
3
million
(es3mates)
3G
Users
10%
100%
70%
- China, Japan, Korea have embraced Android.!
- iPhones are for the 1% richer in China!
- Very few reliable numbers are available (send
me yours!)!

21. Online
Game
Companies
Market
Cap
China
$bln
Japan
$bln
Korea
$bln
Tencent
57.5
GREE
6.3
Nexon
8
Netease
7.8
DeNA
4.6
NHN
(Hangame)
10.5
Renren
2.6
Mixi
<1
NCso`
5.3
Shanda
2.2
Shanda
Games
1.4
as
of
May
5,
2012
Giant
1.2
Changyou
1.2
Facebook
(100)
NetDragon
(91)
<1
Ac3vision
Blizzard
13.8
Perfect
World
<1
Zynga
6.1
The9
<1
EA
5.0
Gaming giants dominate in each country.!
Very few foreign players do well.!

22. Reality
of
China
• Local
partners
are
preky
much
mandatory
for
foreigners
to
get
any
distribu3on
and
operate.
• Successes
are
rare,
generally
accidental,
and
mostly
by
dominant
players
– Mobile
Angry
Birds,
Fruit
Ninja,
a
few
more
– Web
Korean
companies
via
licensing
Easiest to do in China is iOS!

23. Reality
of
China
• Social
networks
are…
TENCENT
– Likle
money
on
Renren
– No
Facebook
• Online
Game
Giants
– Developing
their
own
games
– Licensing
from
Korea
– Rarely
from
other
places
(WoW)
– Excep3on:
League
of
Legends
(but
bought
by
Tencent)
Web-based is almost impossible alone!

24. Reality
of
China
• iPhone
is
for
the
1%
• Android
is
fragmented
– Numerous
app
stores
– Lots
of
copies
– Adver3sing
don’t
make
much
money
iOS is easier, Android still hard!

25. Top
Ranking
Apps
on
iPhone
Source: AppAnnie.com!
Foreign games and apps do well!

26. Top
Ranking
Apps
on
Android
Source: AppAnnie.com!
Android is much harder + Competing stores!

27. Tencent
in
2011
• Revenue
US$4.5
billion
• Mobile
10%
• Adver3sing
7%
– Net
Profit
US$1.6
billion
(35%)
• Services
• Qzone
552
million
MAU
• Pengyou
202
million
MAU
• Open
plaqorm
40,000
apps
– More
than
10
have
10m+
MAU
Money: 10m MAU in China = 1m MAU in USA!

28. Renren
in
2011
• Revenue
US$118.0
million
– ~50%
from
adver3sing
• Net
Loss
US$5
million
• Net
loss
does
not
count
sale
of
eLong
for
US$50
million
• Promo3ng
Nuomi,
its
Groupon
clone
(US$30
million)
• Curb
your
enthusiasm!
Renren is not quite the “Facebook of China” yet!

29. Reality
of
Japan
Smartphone games market
Core Gamers
2014
PC
More than $1.2 billion
Overall
Console market size
Game About $3.6 billion
growing
software
Smartphone
games
Official sites, $1 billion
Mobile
Social games over $1.8 billion
Casual Gamers
Arcade games, Card games, Edutainment
Mobile / Smartphone games is going really big!

30. Mobile
Social
Games
in
Japan
• GREE
– Revenue
$785
million
– Acquired
OpenFeint
($104m)
– Acquired
Funzio
($210m)
• DeNA
– Revenue
$1.4
billion
– Acquired
Ngmoco
($400m)
• Konami
– $360
million
from
social
games
in
2011
The platforms are making most of the money, but some
third-party do well. However, Most Western companies
failed on those platform so far (including Zynga)!

31. Reality
of
Korea
• Aside
from
Blizzard
(local
opera3on),
FIFA
(partnership)
and
League
of
Legends
(hired
Blizzard
staff),
not
many
successes
• On
mobile,
it
is
possible
to
make
money,
especially
via
iOS
• Android
is
big,
but
fragmented
among
several
app
stores
+
regulatory
limita3ons
(GRB)
iOS doable, Android harder, web very hard!

32. Reality
of
Korea
The market figures are including exports, but
still a big market for web, less so for mobile.!

33. Nexon
• Revenue
– 2011
Revenue
$1.1
billion
Market
Revenue
– Net
revenue
$313
million
China
$398m
(38%)
Korea
$348m
(33%)
• 19%
margin
Japan
$158m
(15%)
• China
licensing:
Tencent
=
85%
Rest
of
World
$105m
(14%)
TOTAL
$1.1
billion
• Titles
– Maple
Story
(RPG),
Mabinogi
(RPG),
Dungeon
&
Fighter
(RPG),
Kart
Rider
(fantasy
kart
racing),
Counter
Strike
Online
(FPS)
Nexon does great in China and Japan!

34. NCsov
• 2011
Income
$540
million
• Net
income
$157
million
Market
Revenue
Title
Revenue
Korea
$360m
(66%)
Lineage
1
35%
Japan
$75m
(14%)
Lineage
2
18%
China
(royalty)
$50m
(10%)
Aion
40%
Rest
of
World
$55m
(10%)
Other
5%
TOTAL
$540m
NCsoft has few titles, mostly missed China!

35. Hangame
• Part
of
NHN
Group
– Naver
65%
of
search
market
– Hangame
Casual
games,
#2
player
• Revenue
– NHN
2011
$1.9
billion
– Net
profits
$400m
(20%)
• Gaming
brought
$570m
in
2011
– Japan
=
$267
million
Hangame is #1 in Japan, lots of casual games!

36. Hangame
sourcing
mobile
games
• 20-­‐30
mobile
games
for
Korea
and
40
games
for
Japan
in
2012

37. Game
Ra3ng
Board
For
All
Users Over
12
Years
Old
Over
15
Years
Old Over 18 Years Old
Register game Apply online Deliberation
Reflect result
on a social (send application form, By Game Rating Result
on the game
platform executable file, instructions) Board
To launch in Korea, approval is needed!

38. Payment
Methods
Recharge
(Purchase)
Dotori
1.
Credit
Card
2.
Mobile
Payment
3.
Online
Banking
Payment
method
4.
Fixed
Phone
10
Dotori
5.
Loyalty
Points
=
1,000
KRW
from
partnerships
=
USD
1
(OK
Cashbag)
6.
Prepaid
Giv
Coupons
7.
Prepaid
Cards
In all 3 countries, payment methods are mostly
local. No way around it.!

39. Reality
of
“Rest
of
Asia”
• Rich
&
English-­‐friendly
– Singapore
(English)
– Hong
Kong
(cantonese,
mandarin,
English)
• Somewhat
wealthy
&
somewhat
English-­‐friendly
– Malaysia
(some
–
most
revenue
from
Chinese
popula3on)
– Taiwan
(Taiwanese
=
tradi3onal
Chinese
script)
• Not
there
yet
– Vietnam
– Indonesia
– Philippines
– Thailand…
Some markets can provide decent revenue!

40. Coming
soon:
$50
Android
Phones
Android booming with cheap phones!

41. benjamin@plus8star.com
@benjaminjoffe
Questions & Comments are welcome!!