I recently attended the New York Games Conference in the Big Apple. Being involved with the game industry, but not a game developer myself, it was an enlightening experience to hear about some of the challenges and opportunities that game developers face. The event featured senior decision-makers from some of the hottest companies in interactive entertainment including EA, Supercell, Gamevil, Arkadium,NBCUniversal, Slingo, Tapjoy, GSN and more. Speakers covered topics such as next gen development, game marketing, monetization, distribution, user acquisition and the rise of e-sports.
While the panels and two-pronged set of tracks covered numerous subjects, one key takeaway for me was the fact that free-to-play game business models have and will continue to thrive. Free-to-play models aren’t new – it’s been awhile since the first freemium games were released. But, what is more important is that the experts are saying the model is here to stay! Micropayments are now abundant in games today and this model will continue to produce profits for game companies in years to come.
From one panel, there are 46 million free-to-play players in the US alone! Another panel that focused on Candy Crush Saga, stated that the average player spends about $40 per year which tumbles up to a revenue rate of close to $1 billion for King.com. It was also shared with the audience that CandyCrush generated an average of $438,000 per day in July alone. In yet another presentation, a study looked at various branches of the entertainment and media industries showing percentages of sales in each industry that are digital in nature. The game industry is at the top of this list with 42% of sales stemming from digital sales. This was followed by music at 32%, newspapers at 5%, books at 4% and film at 1%. These numbers are staggering and certainly support the idea that free-to-play has been and remains to be a viable business model for game companies.
I even jumped into the Q&A fray when the topic of multi-currency payments came up, which can be a challenge for many game companies juggling free-to-play business models. We hope to help more game companies overcome this challenge and, ultimately, help make monetizing free-to-play games easier.
– Joe Twer, Director of Sales