Very good and short presentation from IMVU
Showing posts with label virtual economy. Show all posts
Showing posts with label virtual economy. Show all posts
Monday, June 1, 2009
Friday, May 29, 2009
Virtual Economics: Q&A with Gambit Co-founder Noah Kagan
> 
I wanted to share this great Q&A from inside facebook guys:
As we continue our in depth look at leaders the Facebook Platform payments ecosystem, today we turn our attention to Gambit, a new virtual currency monetization and payment service for social apps and games that went public for the first time here on Inside Facebook back in March.
We recently spoke with Gambit co-founder Noah Kagan (formerly of Facebook) about the opportunities he sees inside Facebook apps and games, and the approach Gambit is taking to help developers monetize.
Inside Facebook: When did you realize the business opportunity in providing payment services to online gaming communities?
Gambit is a payment solution for online games, and our services vary based on what clients need. We help clients find the best way to implement a virtual economy, structure price points, and use analytics to maximize ARPU.
What geographic markets is Gambit in?
We focus on the U.S., U.K., Australia, and most of Western Europe. We are the leader in these countries for monetization and competitive in South American and Southeast Asia. We are powering the #1 app on MySpace, #1 app on Facebook, and many other small and large properties. The U.S. is five years behind in virtual monetization, but a lot of consumers are willing to pay for virtual goods. I don't spend much on anything, but I care for game consoles. The market is only going to grow: the question is, how do you make it easy for people to pay?
Discuss the value chain of your business model: Who are the key players, and how is value created for each one?
From the developer's standpoint, the tradeoff is between focusing your time and energy on game development or monetization, which includes aspects such as customer support, fraud, callbacks, tech, API, etc. Developers can spend a small percentage of their budgets on PayPal, or a little bit more on us and take advantage of more services. It's a cost benefit analysis. Gambit provides developers with a buffet of payment options that empower them to make decisions based on statistics that show how much revenue they get from advertisers. We value transparency. Other providers give you numbers, but with no certainty.
Users get phone and email support with us – no one else does this. Then there are advertisers that are making offers, as well as payment companies. Our advertising relationships are pretty well developed.
In terms of competition in the payment space, how would you distinguish your products?
We've innovated with our behavioral ad targeting, complete payments customization, fraud reduction technology, and our transparent analytics. Our business is built on what developers want and how to make more money for them: if they want certain metrics, we will make them available if possible. Because we come from a developer background, we know how our clients feel, whereas other companies are coming from a sales and marketing perspective. We emphasize results and performance, and how to build better products and code.
Across the board, all developers have problems with customer support that they are not aware of. This is a huge challenge long-term that most people discount. The common problems are that users aren't getting their credits or didn't complete all the requirements, and technical problems. We have a full time staff, direct phone support and provide a CRM solution for our clients to see what their users are saying.
What's your reaction to Facebook's virtual currency test?
Competition breeds innovation. Facebook has a lot of inherent value to bring, but how will they provide value specifically to game developers? I'm curious what additional value Facebook can produce that we can't.
How is your company doing from a financial perspective?
Gambit has been profitable since December. We've raised some funding in 2007. Since we have not fund-raised large amounts like our competitors, and we do not have unrealistic growth expectations from a venture capital firm - so that's an advantage.
What kinds of developers are most attracted to your products, and what kinds of virtual goods have been most successful for them?
We are serving over 20 million users across our hundreds of clients a month. Social networking applications, online communities, RPG and flash-based MMO games do very well with us.
Where is the virtual goods economy headed in the future?
There will be an increase in online virtual goods spending in the Western world. Regarding online offers, they need to be more relevant and user friendly: for example, a girl who likes frozen yogurt can signup for free frozen yogurt and get credits at the same time. Right now, some users have a bad experience with offers. We will move toward using more social information – age, gender, geography, and a few other factors in improving offer relevancy. In general, the payment solution that will win is one that helps converts users to paying customers as easy as possible.
Thanks, Noah. Anything else you'd like to share with our readers?
We'd love to chat with anyone interested in optimizing or growing their online economy. Check out more on our blog.
NEWS: Free Realms Reaches 2 Million Players
It seems that sony are having more success with this than Cartoon networks Fusion Fall, more on this soon.
75 percent of these are under the age of 17, and 46 percent are younger than 13, SOE says, adding that nearly a third of players are female. The company it plans to celebrate the milestone by awarding all its users with a special bundle of in-game items.
The game, which is free-to-play but has optional microtransaction and subscription elements, lets users play, socialize and battle, and interact on a social networking site alongside the game.
It ties into a trading card game playable both with physical cards and inside the game via digital codes. SOE says the virtual cards are "sales leaders" inside the game's digital store.
"In less than a month, Free Realms has captivated a core player base of tween and teen gamers, while also strongly resonating with MMO gamers," says SOE president John Smedley. "We wanted to create a game to play with our families and are excited to have hit the mark with our intended audience."
Wednesday, May 20, 2009
Micro-transactions: Q&A with Twofish President Lisa Rutherford #feedly
You need to take a look at this Q&A, if you are seriously getting ivloved in micro-economies, virtual items then this is good information.
President Lisa Rutherford
President Lisa Rutherford
Tuesday, May 19, 2009
RESEARCH: Panel on Casual MMO and immersive worlds
Its from the Summer of Last year but its well worth a watch as it allows you to see how things have evolved from a year ago, also the panelists provide some great stats and insight.
VIRTUAL WORLDS: China's Perfect World Brings In $62.2M
China's Perfect World Brings In $62.2M For Q1
Chinese freemium game publisher Perfect World announced its Q1 earnings today, reporting $62.2 million according to Redline China. This is a 1.8% increase from revenues reported in Q4 2008 and a 40.2% increase year-over-year. It's another signal that the Chinese freemium game market remains healthy and resistant to the global economic downturn that is negatively impacting Chinese Web advertising revenues. The company's net income for the quarter was $31.5 million, up 72.6% from Q4 '08 and 36.1% from Q1 '08.
Chinese freemium game publisher Perfect World announced its Q1 earnings today, reporting $62.2 million according to Redline China. This is a 1.8% increase from revenues reported in Q4 2008 and a 40.2% increase year-over-year. It's another signal that the Chinese freemium game market remains healthy and resistant to the global economic downturn that is negatively impacting Chinese Web advertising revenues. The company's net income for the quarter was $31.5 million, up 72.6% from Q4 '08 and 36.1% from Q1 '08.
What's interesting about these figures is that while revenue is up, peak concurrent users is actually down. For Q1 '09, Perfect World reported 615,000 concurrent users. That compares to 690,000 in Q4 '08 and 660,000 in Q1 '08. Perfect World attributes the drop in peak concurrent users to seasonal elements -- as Q1 contains several major Chinese holidays -- and an aggressive anti-cheating campaign that would have necessarily driven a certain percentage of users away.
ARPPU (average revenue per paying user) for Perfect World in Q1 '09 was 244RMB, or about $35.74. That's up 8.1% from Q4 '08 and 61.6% from Q1 '08. Perfect World attributes the increase in revenue from Q4 '08 to Q1 '09 to a series of successful in-game promotions for sales of virtual goods.
Perfect World projects Q2 '09 revenues to fall in a range between $60.1 and $63.6 million, essentially expecting no more than a 2% change up or down in current figures. Right now user churn is a major concern for Perfect World, so it intends to scale back on the number of sales promotions in the upcoming quarter. It is also expecting to incur higher marketing and operating expenses than usual, which could narrow profit margins.
The Perfect World figures are interesting in terms of how enormously consistent they are with the results recently reported by competitor Changyou. In fact, reported revenues are in the same range. While the Changyou reports did not include projections for Q2 '09, it seems likely that company's future performance will also fall into the same range as Perfect World's.
Monday, May 18, 2009
NEWS : Tencent’s virtual goods revenues keep growing during recession [feedly]
The numbers seem to indicate the resiliency of virtual goods — such as virtual clothing that users can buy for their avatars in a game — versus advertising.
Tencent's web-based virtual goods saw a quarter-over-quarter increase of nearly 20 percent and a year-over-year increase of 75 percent, coming in at $278 million. Its mobile virtual goods sales were smaller but also growing, coming in at $64 million. That revenue stream saw nearly 10 percent growth by quarter and more than 52 percent growth by year. Meanwhile, its advertising revenue got virtually hammered, dropping by 30 percent quarter-over-quarter to come in at $21 million.
In 2008, Tencent made more than $1 billion in total revenue , of which $719 million was from virtual goods.
The caveat, the company says, is that virtual goods revenue "reflected the positive seasonal impact of the Chinese New Year holidays and winter break for students as well as the Company's continued efforts in service enhancements." There won't be as much virtual celebrating later this year, though. The Hong Kong-based company, expects people to spend less on virtual goods due to fewer national celebrations. Ad revenue, however, could climb as advertisers get a better handle on how their businesses are faring during the recession.
Tencent's number dwarfs the amount any Western company is making from virtual goods. Of course, Tencent has a social network, but its massive QQ instant message service and other sub-sites mean it's not directly comparable to social networks like Facebook and MySpace. And clearly, cultural differences are benefiting it in ways that have yet to equally manifest themselves for Western services that use virtual goods. Still, third-party developers on Facebook could make up to $500 million in revenue this year , mostly through virtual goods, as we and Inside Facebook have reported. Facebook, and other companies like MySpace, have yet to make serious money from the virtual economy. Facebook only has a gift store, and MySpace doesn't have anything — yet. But both companies are working on forms of virtual currency that could tie in with third-party applications, and let them get in on the action.
Monday, March 23, 2009
NEWS: Chinas TENCENT reports 1 billion in virtual items
China's TenCent Announces Almost $1B In Virtual Goods Sales For 2008
TenCent reported 2008 annual revenues exceeding $1 billion, an 87% year-over-year increase from 2007 revenues.
$719 million was generated by sales of virtual goods (called "value-added services" by TenCent) to Internet users of the service.
$204 million generated by sales of virtual goods to users in the Mobile category.
Internet virtual goods sales for 2008 represent a 95.5% year-over-year increase from 2007.
Mobile virtual goods sales for the same period had increased 73%.
Only $120 million dollars of TenCent's 2008 revenue is accounted for by online advertising.
TenCent lists its total 2008 gross profits as $729 million at a margin of about 70%.
TenCent's fourth quarter numbers primarily reinforce, and to some degree explain, the overall trends at play in the annual numbers. Total revenue for the quarter was $306 million, a 3.6% increase over revenues for Q3. This suggests that TenCent's revenues were probably stable quarter-over-quarter throughout the year. $216 million of the revenue total for the quarter was generated by Internet virtual goods sales and $56 million generated by Mobile virtual goods sales. Revenues from online advertising account for only $30 million. Gross profits for the quarter $206 million, and operating profit $136 million.
Total registered IM user accounts, active IM user accounts, number of peak IM users, and number of peak games portal users increased slightly from Q3 numbers. Total number of virtual goods subscriptions increased while number of mobile virtual goods subscriptions decreased slightly. However, mobile revenue was still up due to new lines of bundled SMS packages offered by TenCent.
Game-related sales of Internet virtual goods increased substantially from Q3 numbers, by about 18%, due to TenCent launching three new games during this period (Dungeon and Fighter, Cross Fire, and QQ Dancer). The revenue increase for these games was offset somewhat by declining revenues from older games QQ Fantasy and QQ SanGuo. Regardless, it shows that users aren't tiring of virtual goods, just the old virtual goods. Add a new game and new products, and sales continue. Unsurprisingly, TenCent reported a 15.8% decline in online advertising revenue in Q4 2008, attributed to a harsher economic climate.
TenCent's outlook for 2009 calls for stronger sales in Q1 as it contains a major winter break period for Chinese students and several seasonal holidays such as Chinese New Year that are well-suited to sales of virtual goods. Advertising revenue is expected to continue to decline, as traditionally the period surrounding Chinese New Year is weak for advertising purposes anyway.
TenCent is looking to expand its business in 2009 by extending virtual goods sales offline to "include privileges for lifestyle products." TenCent will launch a new social network for students that only permits use of real names as well as three new MMOGs and one new casual game. In the first half of 2010, TenCent expects to launch "up to six" new MMOGs. Advertising revenue is expected to decrease sharply throughout 2009 and not to recover until a general global economic recovery begins.
“In 2008, Tencent delivered strong financial and operating results, leveraging our diversified, platform-based business model which is unique in China’s Internet market. We are also excited to see that, during the year, China has become the largest Internet market in the world by number of users and that Internet has increasingly become an indispensable part of everyday life for people in China,” said Ma Huateng, Chairman and CEO of Tencent.
TenCent reported 2008 annual revenues exceeding $1 billion, an 87% year-over-year increase from 2007 revenues.
$719 million was generated by sales of virtual goods (called "value-added services" by TenCent) to Internet users of the service.
$204 million generated by sales of virtual goods to users in the Mobile category.
Internet virtual goods sales for 2008 represent a 95.5% year-over-year increase from 2007.
Mobile virtual goods sales for the same period had increased 73%.
Only $120 million dollars of TenCent's 2008 revenue is accounted for by online advertising.
TenCent lists its total 2008 gross profits as $729 million at a margin of about 70%.
TenCent's fourth quarter numbers primarily reinforce, and to some degree explain, the overall trends at play in the annual numbers. Total revenue for the quarter was $306 million, a 3.6% increase over revenues for Q3. This suggests that TenCent's revenues were probably stable quarter-over-quarter throughout the year. $216 million of the revenue total for the quarter was generated by Internet virtual goods sales and $56 million generated by Mobile virtual goods sales. Revenues from online advertising account for only $30 million. Gross profits for the quarter $206 million, and operating profit $136 million.
Total registered IM user accounts, active IM user accounts, number of peak IM users, and number of peak games portal users increased slightly from Q3 numbers. Total number of virtual goods subscriptions increased while number of mobile virtual goods subscriptions decreased slightly. However, mobile revenue was still up due to new lines of bundled SMS packages offered by TenCent.
Game-related sales of Internet virtual goods increased substantially from Q3 numbers, by about 18%, due to TenCent launching three new games during this period (Dungeon and Fighter, Cross Fire, and QQ Dancer). The revenue increase for these games was offset somewhat by declining revenues from older games QQ Fantasy and QQ SanGuo. Regardless, it shows that users aren't tiring of virtual goods, just the old virtual goods. Add a new game and new products, and sales continue. Unsurprisingly, TenCent reported a 15.8% decline in online advertising revenue in Q4 2008, attributed to a harsher economic climate.
TenCent's outlook for 2009 calls for stronger sales in Q1 as it contains a major winter break period for Chinese students and several seasonal holidays such as Chinese New Year that are well-suited to sales of virtual goods. Advertising revenue is expected to continue to decline, as traditionally the period surrounding Chinese New Year is weak for advertising purposes anyway.
TenCent is looking to expand its business in 2009 by extending virtual goods sales offline to "include privileges for lifestyle products." TenCent will launch a new social network for students that only permits use of real names as well as three new MMOGs and one new casual game. In the first half of 2010, TenCent expects to launch "up to six" new MMOGs. Advertising revenue is expected to decrease sharply throughout 2009 and not to recover until a general global economic recovery begins.
“In 2008, Tencent delivered strong financial and operating results, leveraging our diversified, platform-based business model which is unique in China’s Internet market. We are also excited to see that, during the year, China has become the largest Internet market in the world by number of users and that Internet has increasingly become an indispensable part of everyday life for people in China,” said Ma Huateng, Chairman and CEO of Tencent.
Thursday, December 18, 2008
MINI NEWS: No nonsense headlines
Wireless Mics come to Singstar 2009, cool!
Pop Cap release Peggle nights level pack
Hasbro drops lawsuit against scrabulous
50 MB broadband arrives in the UK with Virgin (more on this soon)
Aeria gifts virtual currency to community
92% of VC's predict investment slowdown (more on this soon)
Neo Pets gained 8.6 million users in 2008
Warner buys another 10 million Eidos shares
Tuesday, October 21, 2008
Reebok "in game deal" for Football Superstars
Don't you just love this industry.
In a time when there is doom and gloom and the cost of everything is rising just go shopping VIRTUALLY.
Reebok and IGA WW and Sports MMO Football Superstars have teamed up in the latest game sponsorship deal.
The free-to-download online game will be used by Reebok as a platform to launch its Ambassador Programme. Successful entrants to the programme will win a supply of Reebok boots and kit with in game currency, apparel for avatars, as well as an interview Thierry Henry.
THIS is a perfect example of contextual advertising well done guys
Friday, October 17, 2008
Game Link - This weeks casual games news
Week Round up.
1) New Event to Be hosted called "The future is online"
2) Lead Economist talks about Eve and the virtual economy
3) Microtransactions make it to mobile with Supper Boom Boom
4) Game loft pledge 10 titles for Android (google)
5) Atari sale is completed
6) Sega launches free to play casual games site
7) Sony to launch digital distribution for PSP (big opportunity for casual games)
------------------------------------------------------------------------------------
The Future is Online, says GameHorizon | Game Development | News by Develop: "GameHorizon is to hold a MMO-focused event in Newcastle next week.
Called 'The Future is Online', the evening will take a look at what it takes to be successful in the online space, and how studios can make the transition to online."
---------------------------------------------------------------------------------------
Dr. Eyjolfur Gudmundsson, the Lead Economist at CCP, developer of EVE Online, talks about the impact of what's essentially a real-world economy in a virtual world.
by Eyjolfur Gudmundsson, PH.D. on Tuesday, October 14, 2008
My Turn: The Birth of the First Virtual Nation
It has been over 30 years since online virtual worlds have started to emerge in the form of MUDs (Multi-User Dungeons). Over this time period several variants of virtual worlds have emerged, with each form having different opportunities and challenges for the developers.
Stating that the economy in EVE is realistic is wrong. The economy in EVE is actually just as real as our real life economies, by all measures and definition of economic value based on economic theory. This fact has great implications in terms of how to interpret information from economies in virtual worlds, and shows that economics must be used as a fundamental feature in the design and operation of these worlds.
-------------------------------------------------------------
A sequel to last year's Super Boom Boom, the one-button action game features five stages with bosses, three unlockable extra stages, casino mini-games, a driving mode, and a nationwide leaderboard.
Gamevil claims that Super Boom Boom 2's microtransaction system will cover 98% of available handhsets, enabling players to purchase G-Points (in-game currency), which can be exchanged for new stages, items, and mini-games. The G-Points can be earned for free while playing the game, but users can bypass that step by purchasing them.
The company's previous forays into microtransaction-enabled mobile games include Baseball Superstars 2008, which reportedly saw 1.3 million downloads withing 10 months.
------------------------------------------------------------
Gameloft plans 10 titles for Android, Google's open source mobile platform.
Bubble Bash, which is currently available for the iPhone and other mobile devices, will be the first Gameloft title to launch through the Android Market content distribution system in the first quarter of 2009.
------------------------------------------------------------
Atari is now a wholly owned subsidiary of Infogrames. The acquisition will enable Atari to expand its distribution capabilities and online initiatives.
by James Brightman on Monday, October 13, 2008
Infogrames Completes Atari Acquisition
Infogrames' plan to buy the outstanding stock in Atari, first revealed back in March, is finally complete. The French publisher now owns all of Atari, as compared with 51.4 percent before the acquisition.
---------------------------------------------------------------
Sega has taken the wraps off of a new casual games site with free-to-play games. PlaySega features a wide variety of titles in addition to Sonic-based gaming.
by James Brightman on Tuesday, October 14, 2008
Sega Launches Casual Portal PlaySega.com
It's been somewhat under the radar, but Sega has launched a new casual gaming portal with free-to-play games at PlaySega.com. The portal (currently in beta) features an assortment of arcade games, puzzle games, card games, quiz games, word games, sports games, and Sonic games, the first being Sonic at The Olympic Games. There are apparently more than 30 new titles in development for the site.
-------------------------------------------------------------------------------
SCEE: Digital distribution to "ignite" PSP development
The PlayStation Portable's new distribution methods will spur on creative development for the handheld, according to Zeno Colaço vice president of publisher and developer relations for SCEE.
Colaço described how the combination of digital distribution with the increased functions of the PSP 3000, announced at the Leipzig Games Convention, would make the handheld a more compelling platform for developers to work on.
1) New Event to Be hosted called "The future is online"
2) Lead Economist talks about Eve and the virtual economy
3) Microtransactions make it to mobile with Supper Boom Boom
4) Game loft pledge 10 titles for Android (google)
5) Atari sale is completed
6) Sega launches free to play casual games site
7) Sony to launch digital distribution for PSP (big opportunity for casual games)
------------------------------------------------------------------------------------
The Future is Online, says GameHorizon | Game Development | News by Develop: "GameHorizon is to hold a MMO-focused event in Newcastle next week.
Called 'The Future is Online', the evening will take a look at what it takes to be successful in the online space, and how studios can make the transition to online."
---------------------------------------------------------------------------------------
Dr. Eyjolfur Gudmundsson, the Lead Economist at CCP, developer of EVE Online, talks about the impact of what's essentially a real-world economy in a virtual world.
by Eyjolfur Gudmundsson, PH.D. on Tuesday, October 14, 2008
My Turn: The Birth of the First Virtual Nation
It has been over 30 years since online virtual worlds have started to emerge in the form of MUDs (Multi-User Dungeons). Over this time period several variants of virtual worlds have emerged, with each form having different opportunities and challenges for the developers.
Stating that the economy in EVE is realistic is wrong. The economy in EVE is actually just as real as our real life economies, by all measures and definition of economic value based on economic theory. This fact has great implications in terms of how to interpret information from economies in virtual worlds, and shows that economics must be used as a fundamental feature in the design and operation of these worlds.
-------------------------------------------------------------
A sequel to last year's Super Boom Boom, the one-button action game features five stages with bosses, three unlockable extra stages, casino mini-games, a driving mode, and a nationwide leaderboard.
Gamevil claims that Super Boom Boom 2's microtransaction system will cover 98% of available handhsets, enabling players to purchase G-Points (in-game currency), which can be exchanged for new stages, items, and mini-games. The G-Points can be earned for free while playing the game, but users can bypass that step by purchasing them.
The company's previous forays into microtransaction-enabled mobile games include Baseball Superstars 2008, which reportedly saw 1.3 million downloads withing 10 months.
------------------------------------------------------------
Gameloft plans 10 titles for Android, Google's open source mobile platform.
Bubble Bash, which is currently available for the iPhone and other mobile devices, will be the first Gameloft title to launch through the Android Market content distribution system in the first quarter of 2009.
------------------------------------------------------------
Atari is now a wholly owned subsidiary of Infogrames. The acquisition will enable Atari to expand its distribution capabilities and online initiatives.
by James Brightman on Monday, October 13, 2008
Infogrames Completes Atari Acquisition
Infogrames' plan to buy the outstanding stock in Atari, first revealed back in March, is finally complete. The French publisher now owns all of Atari, as compared with 51.4 percent before the acquisition.
---------------------------------------------------------------
Sega has taken the wraps off of a new casual games site with free-to-play games. PlaySega features a wide variety of titles in addition to Sonic-based gaming.
by James Brightman on Tuesday, October 14, 2008
Sega Launches Casual Portal PlaySega.com
It's been somewhat under the radar, but Sega has launched a new casual gaming portal with free-to-play games at PlaySega.com. The portal (currently in beta) features an assortment of arcade games, puzzle games, card games, quiz games, word games, sports games, and Sonic games, the first being Sonic at The Olympic Games. There are apparently more than 30 new titles in development for the site.
-------------------------------------------------------------------------------
SCEE: Digital distribution to "ignite" PSP development
The PlayStation Portable's new distribution methods will spur on creative development for the handheld, according to Zeno Colaço vice president of publisher and developer relations for SCEE.
Colaço described how the combination of digital distribution with the increased functions of the PSP 3000, announced at the Leipzig Games Convention, would make the handheld a more compelling platform for developers to work on.
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