Why everything you know about the games market no longer matters. Why the next few years will change everything we have been used to. I told you so.

1. Why everything in games today is
irrelevant:
Do not distribute without permission

2. Disclaimer
• I am an Apple fan boy
• All examples also apply to
Android & Windows 8
devices
(since 1985)
Opinions expressed herein are entirely mine and not from Ubisoft
By Teut Weidemann
Senior Online Games Supervisor

3. How the iPhone changed the world
The Smartphone crippled or are in the process of crippling:
• Classic mobile devices
• Alarm clocks, even watches
• Netbooks
• Notebooks
• Classic “consumer” PC's
• Digital compact cameras
• Compact film cameras
• ‘Mp3 players’ (-iPod)
• SMS
• Books & magazines
• Guides, Maps, Menu’s, Cashiers
• Navigation devices
• Flash on mobile + Internet
• Tickets, Flashlights etc.
• Soon: Intel CPU’s, radios, customizable remotes, TV playback devices
• Soon: creditcards, payment

4. Race to a billion

5. Years to reach 50% household penetration
Wtf? →
6x more Smartphones are sold per day than kids are born
Source: http://www.asymco.com/

6. Source: http://www.asymco.com/

7. Brain Reset
More downloads/hour than best selling
Xbox360 games in their lifetime

8. Smart devices*
What are they for us?
*means smart phones and tablets

9. The brain filters negative experiences over time
So we remember positive* experiences
Especially when memories are attached to multiple senses
(That’s why we like “retro” or “vintage” under this effect)
*negative experiences are called trauma
Source:

10. We learn & memorize efficiently when we use multi-sensors
Source: John J. Medina “Brain Rules”, Dr. Bruce Perry

11. That’s why kids learn faster with touch
Our future grows up with touch!

12. Tablets revolutionize our education
Source: IDC, May 2013
Our future learns with touch!

13. Life is changing …

14. Life is changing …

15. Life is changing …

16. Life is changing …

17. History of Knowledge Power
Population with access to knowledge
Keeping knowledge a secret and exclusive was key for abusive
power in the dark ages
2009
1990
1973
1878
1837
Scribes
1455
Access to knowledge grows exponential over time

18. = Outsourced ‘slow’
Memory
The collected knowledge of humanity in your pocket
Always with us
Connected to everyone
Source: http://www.salon.com/2012/11/05/joshua_foer_weve_outsourced_our_memories/

19. It’s not simply that we use our fingers now instead of a mouse.
Smartphones, in particular, have become extensions of our brains.
They have fundamentally changed the way people receive and process
information
Source:
http://www.nytimes.com/2013/10/06/magazine/and-then-steve-said-let-there-be-an-iphone.html

20. Source: http://juliansarokin.com/abundance-were-becoming-gods-and-dont-even-know-it/
The Internet is an exponential modifier on human knowledge and
collaboration that will be applied multiple times.
Google, Wikipedia, Amazon, Feature Phones were the 1st exponent.
Youtube, Twitter, Skype, Facebook and Smartphones are the 2nd
exponent.
It usually takes about 15 years to feel the full effects of an exponent
(we feel the full effects of Web 1.0 and we're still growing into Web
2.0).

21. Microprocessor Transistor Counts
1971-2011 & Moore’s Law
+60% per year
Nielsen’s Law of internet bandwidth
+50% per year
Smart devices soon will perform as fast as PC’s

22. Humans are bad extrapolating exponential growth
LETS EXTRAPOLATE!

23. Example Extrapolation
Now:
Speak – wait 3-4 seconds – listen to translation

24. Example Extrapolation
Tomorrow:
Real time translation of all spoken languages on earth
For everyone
In your phone

25. Extrapolation II
SciFi: Enterprises “Ship computer”
Tomorrow: Siri enhanced

26. “Meta”
Big Data
Intelligent
Services
(jp)

27. “i-concier” Intelligent Services (jp)
“Imagine i-concier as a kind of personal assistant built
into your phone,” says Toshihiro Inomata, Assistant
Manager of DOCOMO’s
Uses your GPS data to track your behaviors and use
data to forecast your event & information needs
(Check Google Now)

28. This is the battle of the century…
More global giant Fortune 500 sized companies are in this race than
in any other industry, ever.
The world's
most profitable
company
The world's largest
consumer electronics
company
The world's
biggest internet
company
The world's
biggest basic
cell phone maker
The world’s largest
computer manufacturer
by one count
The world's
largest software
company
The world's largest
computer manufacturer
by the other count
The world's
biggest technology
company
The biggest
mobile phone
operator/carrier group
Almost any major tech or consumer electronics brand you can think of is in the smart phone races
from Panasonic to Sharp, from Alcatel to LG, from Dell to Fujitsu, from Acer to Toshiba.
Source: http://communities-dominate.blogs.com/brands/

29. Google won!*
Google has won the battle for the 6th mass media (internet)
It has just now been declared the winner of the 7th mass media (mobile)
*That doesn’t mean iOS is dead – on the contrary

30. Race to a billion
In Q3 2013, Android breached the rarefied Billion
user club.
A Billion users?
Only a handful of brands have ever reached that lofty level:
In 2014, Android will breach 1.5
Billion users
In 2015, Android will breach 2.0 Billion users*
In 2016, Android will breach 3.0 Billion users
*It took Visa 32 years to reach 2b, Android does so in 7 years
Source: http://communities-dominate.blogs.com/brands/

31. What does it mean
to be an “app”?

32. Situational Usage

33. Smartphones vs. Tablets
This is 67% on tablets
This is a console!
Smartphones: Sponsored by carrier
Tablets: twice the cost of an Xbox 360! (→ Users have more spendable income)
iOS gaming: “Wife compatible couch gaming device”

34. Mobile gaming? Think again

35. Type & Location of usage
This is all tablet!

36. These are your game locations!

37. Smartphones disruptive?

38. Smartphones disruptive?

39. Smartphones Sexy?

40. Business & Sales
Note this is 2012 on purpose

41. Being an App means
• Easy worldwide publishing
including Asia
• Easy access:
download/Installation is one
click
• Easy updates: one click
• Easy payment in app
• Client based
– but size <100MB over air,
– no code streaming! Art/Level
ok
• "protected" client
– (but jailbreak problem!)
• Lots of sensors: touch, gyro,
microphone, GPS, internet,
Bluetooth, cameras, light,
sound
• Always on, everywhere,
even outside game sessions
• Push: persistent worlds can
push status changes to
users
• Always* with user
• Full tracking, even RL and
game behavior
And Apple takes 30% revenue share  But is
it this bad?

42. 30% for Apple – we gain?
1.
2.
3.
4.
5.
6.
7.
No bandwidth costs, even for download, patches
No hosting costs
No charge backs or payment support issues
No payment provider fees
No VAT problem country by country
20% rebate on iTunes cards included in fee
worldwide market access

43. App Store Visibility
• Option: Get Attention of Apple*
• Word of mouth > 45% of sales
your app name must be memorizable worldwide!
• Great App Icon can double sales (!!)
– Verify icons of top apps
– Do simple CT campaigns to AB test icons
• Ratings are important
– Rules, updates, community
*means: true touch, innovation, something special
http://developer.apple.com/library/ios/#documentation/userexperience/conceptual/mobilehig/IconsImages/IconsImages.html

44. Example Top Grossing Game
12 million revenue
first month

45. #1 Top Grossing Game
> $2000.000/day
(50% from USA!)
Sold 51% share for 1.5b!

47. Source: Applift.com

48. The key takeaways of the analysis are:
•The global mobile games market will grow 27.3% annually to double in 2016 and reach $23.9 billion.
•This growth is fuelled by an increase in the number of players, payers as well as a higher average
spend per paying mobile gamer.
•The tablet games market will show 400% growth until 2016, to reach $10 billion.
•Already 966 million, or 78% of all 1.2bn gamers worldwide, play mobile games.
•368 million consumers worldwide, or 38% of all mobile gamers, spend a monthly average of $2.78 on
or in mobile games.
•By 2016, these figures will amount to, respectively, 50% and $3.07.With 48% of the global revenue,
the Asia-Pacific region is by far the biggest market for mobile games.
•Western & Eastern Europe will grow fastest with Compound Annual Growth (CAGR) rates of over 33%.
•Within the APAC region, China and South-East Asia boast comparable growth figures.
•Average monthly spend per paying mobile gamer is highest in Western Europe with $4.40.
•In comparison, in North America this figure stands at $3.87, with however the highest share of payers
amongst players worldwide (45%).
•Costs of acquisition for loyal mobile gamers range from $1.11 and $0.74 on iOS and Android
respectively in smaller Latin American countries to $3.70 and $1.71 in mature APAC markets such as
Japan, South Korea and Australia.
•erall, Western Europe, North America and Asia Pacific will remain the most appealing markets for
mobile game publishers.
Source: http://www.newzoo.com/insights/infographic-mobile-games-market-to-double-in-size-until-2016-and-reach23-9bn/#khTtjfjlhADVfxCs.99

49. Old vs. New

50. Games?
Source:
Ben Cousins, DeNA
Graph showing Average daily gross sales trends since 2008 - iOS App Store vs. NPD
packaged goods software (millions, USD)
Digital PC sales not tracked yet

51. PC Games?
Source: Asymco
http://www.asymco.com/2013/10/10/the-five-year-plan/

52. Games?
“Horn” on iPad
vs
Angry Birds
Smart Devices will be the major game platform of the next decade

53. Games!
I am not saying AAA gaming is dead
I am not saying AAA games won’t grow further with Next Gen
Last Gen sold 240m+ consoles since 2005, over 8 years
Tablet/Mobile sold 1.5b+ since 2007
In 2018 Consoles will be up to 240m+ again
In 2018 Tablet/Mobile will have penetrated half of humanity
Do the math.
There will be a shift
-Of talent
-Of companies
-Of games
-Of revenue & investment
Key take away: be ready, the games market won’t be what it was
Also read: http://de.slideshare.net/bge20/2013-11-mobile-eating-theworld?utm_source=slideshow&utm_medium=ssemail&utm_campaign=upload_digest

54. Touch?
Q&A
Twitter: @Teut
Blog:
teut.blogspot.com