Money, Markets & Disruptive Trends – Xsolla’s Chris Hewish

[Music] Chris Huish welcome back to the podcast thank you Mishka happy to be back yeah so last time you were here you were you an interim CEO or a president of exola gosh last time I was probably in the interim CEO role as we were going through rebuilding our executive team to prepare us for this next stage of growth that we've been experiencing nice and now you're back at being being president so there was election inside of uh EXA and you won you got the nuclear codes [Laughter] now so uh for folks who don't know you so yes you are a president of exola uh second term congratulations and uh prior to that uh you H leadership positions at Activision sky dance DreamWorks and survi survios servos yes great VR Studio One of the pioneers servos yeah i' not not

familiar with VR Studios but their their games look really cool and what people don't know about you is that every time we record a podcast with you it's so easy because you come extremely prepared like you have pages and pages of of uh of material we can talk about so I'm excited I'm excited because like there's there's tons of topics absolutely and and I'm thrilled as well I always enjoy coming on the podcast and you know I have to give full credit to that preparation element to uh Joseph Kim because back in the day I remember doing some podcasts with him he always had a document prepared ahead of time that we would put our notes and our thoughts in and as well as yourself I mean you do that for for your podcast right so I only learned from the best so thank you yeah well he's a diligent guy and yes I've learned from but also Joe Kim told me the most important part where I asked him like how can you shoot so many podcasts so like so many videos so quickly and he's like listen

if it takes you more than 15 minutes to prepare for the podcast that means there's nothing interesting to talk about like if you really have to find topics to talk about so this podcast took me less than probably two minutes to figure out what we're talking about because you had exola state of play report so there's a plenty of interesting topics there and I was thinking that that you know as you probably prepared let's talk about these these six different topics so so today we're going to talk about Mobile gaming market growth always very positive stuff uh we're going to talk about diversity and gaming that was one of the topics that that that was in the State uh state of play so exola state of play report autom addition uh there's global market trends and preferences there's impact of digital markets act this is super interesting because this is changing so rapidly with all the legal cases coming back back and forth uh cross media integration fascinating and then of

course we can't have you on without talking about what's going on with the web shops now because that is also uh an area that is rapidly evolving I don't know a company that hasn't been using web shops or adopting web shops as of late so very interesting to hear like what's the situation right now so Chris let's dive in yeah absolutely and you know our report that we put out a few times a year we we put tons of information into it and we also engage with a lot of our partners and people that we know throughout the industry to get various inputs and voices into the report so I really appreciate the platform and yeah let's dive in and and pull out some of the Nuggets that might be of interest to people perfect link to the report will be in the description below whatever platform you're using so so click on that and you'll be able to to access the uh the full shebang but um let's talk let's talk first about Mobile gaming growth so uh in the report you

talked about that that its forecast should generate almost 100 billion globally in 2024 with Asia being the largest contributor to the growth you talk about the emerging regions so I think Mina has been has been kind of like the focus of everything and Anda has been doing a lot of stuff in Saudi Arabia as of late as well so that has definitely uh been the focus of growth as well as uh Latin America and and Africa so what's uh what's happening with with the uh Mobile gaming market and its growth yeah so I think you know we're we're now back to a growth mode in the in the mobile market obviously 2022 we saw that downturn things kind of leveled out in 23 and it's really exciting now to see that the industry is back to growth as people have started to figure out how to get back to acquiring users and uh just just the strength of the the market overall um we do go through in the report we High light all the

different regions and we pull out key data points around the number of players uh you know sort of how much revenue is being generated by region uh the growth rates for each region uh so you know for instance if I look at just uh you know North America right we have Canada and the US here and we break those down uh the US is projected to have player spending on the rise by by 12.3% year-over-year wow uh which is great right and then you know we go through l America Europe uh Africa Middle East Asia pacif Pacific Australia and Oceana uh so you know we cover a lot of different players and regions and and let's look at you know New Zealand which is a place that I I love I've been to a number of times working with a great company down there ppac back in the day and you know that's a a region that is our country that is projected to uh grow by what uh 2% in 20 23 um and it's up to

I think 107.5 million in Mobile revenue for 2024 so small in the grand scheme of things but even you know a location like New Zealand is growing and you know that's exciting for everybody and um you know I think when you look at the categories as well we we start to break down uh the number of app store downloads information about play sessions uh you know we see that the the average session length for mobile Gamers is fairly steady from 2022 to 2023 at 32 minutes per session um and then we break into regionally what does that look like right Asia Pacific has the longest session lengths uh increasing from just under 35 minutes to slightly over and um with Latin America you know we see there's overall year-over-year growth in both session length and installs uh going up um or sorry uh overall yeah

we've seen an increase there uh or decrease rather from 27 to 26 minutes per session sorry I had that one backwards but anyway uh we go into depth like that in the report so you get real Regional breakdowns that can be really helpful not just in talking about how the industry is growing but maybe where you're going to focus some of your efforts and uh hopefully that can be helpful to to folks out there you've heard of heroic laps by now and we keep talking about them because you need need every Edge to be successful in today's market heroic Labs gam stack is built like a Breck house you got the Nama their back-end game server hero their game development framework sator their live op service and last but not least heroic Cloud to provide massive scalability heroic Labs is a battle tested partner and their Tech enables you to be flexible creative and scale for Success focus on your game avoid Tech risks grow product with

scalable liveops and save a big chunk of cheese all with heroic [Music] labs and how do you get this this data because like often times I'm we're getting a lot of reports from from different companies whether it's the app sler on the UA report side whether it's sensor Tower app magic um Google does a lot of reports and and there's a little bit of a discrepancy so I'm like trying to understand like what's the single source of Truth because there there's so many data points coming in attention app and game developers are you ready to unlock the secrets behind the world's top performing apps and games with sensor Tower you get the ultimate Competitive Edge whether it's breaking into new markets fine-tuning your UA strategies or boosting monetization dive into Data like never before track Global Trends across app stores analyze Market leading Ina purchase and in ad strategies and

Benchmark your performance with real time Insight the best part sensor Tower doesn't just deliver data it helps you turn it into action with intuitive tools and expert analysis it's everything you need to make smarter faster decisions thousands of app and game Studios from Indie creators to Global Giants trust sensor Tower to help them win so why not you start your free Trust today at sensor to.com that is sensor.com there are so many data points I mean it is it it's confusing right in the industry especially when you go out there and see everybody's reports you know for us it's a combination of things Mishka it's we have you know our own data that we're seeing and we anonymize obviously uh on what's going going on

and we'll talk more about this a little later but off platform right we we have great insight into what's happening there uh probably the most inside out of anybody uh out there um and we'll talk again more about that uh but then we also really talk with our partners and we we get a lot of information from our partners uh we sort of survey them uh officially and then we unofficially have conversations with people and then we also use various data sources that with companies that we've partnered up with to you know kind of get to this overall picture of where where things are yeah that's and that's a that's a that's the other challenge because when we get data from the data platforms or app stores then they're not seeing the webshop revenue of course which is and some of the games like again talking anecdotally to some of the uh the top grossing titles we're saying about almost 50% some even 50% of their revenues coming now from web shops especially with more core games but they're also not seeing

Ina ad revenues and that again kind of excludes another massive segment of games as well as a massive portion of revenues so that's that's what I mean is like there's a lot of information coming from different platforms but none of the platforms is able to fully see what the market looks like they only have their own Vantage Point yeah I mean that's right it's really difficult to get an aggregated comprehensive View and you that's what we're trying to help provide here I'm not going to claim that we we have you know a 100% Fidelity on all of that I think nobody does but we certainly are in a position where we can bring multiple uh points of view and data points together and um provide I think a pretty a pretty good assessment of where things are yeah especially around the uh off-platform payments like that's that's your unique access to data that others just simply cannot uh share um and and

yeah like it makes sense that the the growth is there because there's tremendous secular Tailwinds in the gaming industry that that sometimes we forget about when we focus on year-over-year numbers and especially when we focus on comparing today's numbers to covid years or the lockdown years like like it's nothing will compare ever to that it was an absolutely unique time uh and and especially uniquely beneficial to digital products as as games so so it's kind of unfair of a comparison that's why I always I mean at least I skip and kind of go back to 2019 or you know post 2022 comparison rates and fortunately we're kind of already a year removed so we can actually see what the what the market truly is and and you mentioned like the other sort of a growth factor so the secular Tailwinds in form of uh a lot of new players coming into the platforms I think the year-over-year growth of of players worldwide is about 5% that was a newo data that they showed that kind of makes sense um you

mentioned the the Privacy you know the effect of the Privacy changes are kind of be mitigated to some extent with uh with a lot of innovation I mean this is recording like few days after app loven's hockey stick numbers they clearly know what they're doing so they're back I mean they're not even back they're they're way be above what they were even before and then you mentioned something about session lengths and I think this was the interesting one so you're uh do you see the increase in session lengths or is there a comparison numbers or How does it go yeah yeah we definitely are seeing increasing session lengths and that is something again that we we kind of dive into in the report here and we we have some different highlights um you know I think what that's reflective of and and I'm just scrolling through here a little bit to uh to see if I have some some overall numbers but uh I will say you touched on you know what happened during covid right and we had that huge surge

of people coming in uh to the industry and playing games and then there was a drop off to be expected um but what I think you're seeing happen and and we're seeing with session lengths is you know there are people that have stuck around and and you know that was kind of a shock to the system in in the sense that it introduced a lot of play new people to games and while a lot of them may have dropped out you still have a cohort that stayed and now are becoming much more mature gamers uh than they were a few years ago and I believe that could be one of the reasons that we're seeing a slight increase in in session length and play time uh in addition you know games are just getting more and more mature and uh have much more depth of play to them you know we're seeing that increased Trend overall as as games are you know people are really focused on retaining the players extending the engagement uh even into more midcore and Casual kind of games um so I think I think that's all all great it's good for for the

industry this podcast is brought to you by apps flyer in today's Digital World understanding your apps Journey from Discovery to download is more than just insightful it's essential enter apps fer the leader in Mobile attribution and marketing analytics that allows you to measure the full potential of your marketing efforts making every ad dollar work smarter with apps flyer that's your new reality dive deep into Data driven insights that reveal exactly where your users come from and how they'll interact with your app apps sler where your app's potential meets performance yeah the focus on live Ops and and that's what I meant with the vantage point because uh I was at the at a Google event last week and I had to pull up one of the pictures that uh that Tobias no shout out to Tobias he was showing in his presentation he had kind of like two things about the sessions and and no three things he said that uh there was a less time span with screens

so that was like minus 177% on average he talked about that average gaming sessions are shorter minus 16 minutes and if you were play during weekday afternoons or to pass time and that was like minus 6% but all these numbers are comparison of today against 2021 or 2020 and and this is what I mean is like sometimes we kind of like PL like even platforms want to show certain type of uh you know radical number number and you're like oh my wow like like Google is showing us you know session like the engagement is going down it's like yes you know Peak lockdowns it is and we do have a slide in here I've pulled up uh that I'm sort of looking over at on just play sessions and you know like I said the we see that the sessions have kind of remained steady from 2022 to 2023 at 32 minutes per session you know I just talked about that a little bit uh but you do see a slight decline in in some Market markets you know North America Latin America um

Eastern you know or Europe and Middle East um where there's been a little bit of a a a decline but on the on the other side you know we break into different genres and you know action games they kind of take the lead with uh 45.7 minutes per session you know followed closely by RPGs which is no no surprise uh and then hyper casual getting the shortest lengths so I think you know when you're talking about overall like you take session length time as sort of an aggregate overall number that gives you one picture which you know maybe it's like yeah things are declining a little but I think it's then important to look down by genre right and by region to see what's actually happening underneath because you know is this just a story of casual game session length coming down because those that covid cohort has kind of you know cycled out a little bit and the people that have stayed have gone into more midcore and core games which would have higher session lengths but fewer people so I don't know it's you know I think I think it warrants a much deeper sort of

exploration before having a full uh you know takeaway that session lengths overall are down do you know what I mean yeah yes yeah I fully understand and last question about the market growth is like is is the like my hypothesis and maybe I've seen some numbers maybe it's a hypothesis maybe I'm remembering something but it was more that the growth wasn't so significant in uh matured Asian markets like we're talking about Japan China Korea uh as well as key key Western markets like the US and Canada and Germany and so forth uh but the growth was more driven by by uh by Emerging Markets we're talking about Mina and Southeast Asia and so forth is is that correct hypothesis or no yeah no I mean for sure we're seeing real growth in Middle East North Africa and just Africa in general uh you know there's been explosive growth there a lot of that tracks the just the over demographics where you have very young

uh overall uh you know the countries themselves are just very young the median age and you have people that have really grown up uh used to technology and gaming and and now you have these large cohorts of of you know players that are are really hungry for content in markets that are also seeing really good economic Tailwinds right so I think that's accurate yeah interesting all right um let's move on to another topic that is totally different it doesn't have anything to do or maybe has some something to do with uh with uh with growth of the market and that's diversity in gaming so you covered also this kind of emphas empath emphasizing the importance of diversity highlighting the significant role women play as gamers in and Industry leaders um and and how that affects the uh the the broader market so uh can you talk about the uh the diversity part of your report absolutely we you know we are always trying to highlight uh just how the industry is doing when it comes to being

inclusive and expanding and you know increasing diversity you know I'm a firm believer in the in the concept that the more variety of voices you have in the room the better off everybody is you know from even from just a development standpoint but also the industry so you know we go into this with with our reports we always have a section about it and we talk about the number of women who are are identifying as mobile Gamers now um you know we see that uh you know women are definitely a big portion of mobile Gamers with what we see 87% playing at least weekly and and 64% of those making an app purchases um you know this which is massive right and that's um just an increase that we're seeing brands are increasingly targeting female Gamers so you know people may Wonder like oh great you guys are talking about diversity you know we know that's you know the industry is becoming more diverse but what does that really mean for the business and you know I think it's important to remember that

not only does it help you create better content but it opens up the door to more opportunities for monetization uh as example you know here with Brands you know really increasingly targeting female Gamers um so we go into those kinds of things a little bit here we talk about the growth in stream streamers and Esports uh with with uh more and more diversity coming in there and then we we kind of cap it off with a really great conversation with uh an I apologize Laura if I mispronounce your last name but Laura Tech Mariam for our Tesla Mariam from LinkedIn uh she's a senior director of product management there and really talks about her experience with games and the tech industry uh so definitely worth a read there yeah 100% I I I think I told this story before it's like um like we've also focused on not may maybe it's diversity but what what you said in the business sentence of diversity is that that I think

representation is the right word to to use is that like you know for almost like 10 years we didn't really have women on this podcast like of course we would have guests but we didn't have women as hosts and so forth uh because you know there was just not concentrated effort and it was something that my wife said when when I tried to uh get her to listen to this Finance podcast that I was really enjoying and she told me like I'm not going to listen to to dudes talk about money and it was like such a light bulb moment I'm like exactly that's why we don't have women listening to deconstructor of fun and and then uh then there was like a very conscious focus on like we need to have representation because it it goes with all sorts of entertainment if if you know if you kind of feel like there's bunch of guys talking about games that's not going to be as popular as as if you have you know a different types of voices and different types of views uh by by bringing in also female co-hosts

absolutely yep absolutely agree with that yeah and arguably made the product better so so I agree I agree with with you as well on on on on that that front on U so important topic uh for for any entertainment company is how to reach a broader audience and diversity representation is definitely a good medium there um global market trends and preferences so this was something that you had here and we know that that every Market is is very unique very preferences are very unique often times when when even we're analyzing certain games uh and the content of the games like especially the ugc type of a games and their content we can see that content that is popular in Canada would be content that is not popular at all in southeast asiia they like totally different type of experience and totally different type of games so so this is a interesting um topic that you cover here can you talk a little bit broader about the uh the trends and preferences yeah I mean we like I said we go into

sort of detail on a regional basis uh talking about we kind of take a a view of the growth and the spend and uh what types of game genres are are kind of popular um you know for instance in the US we see that casual and and hybrid casual mobile games are driving kind of a Resurgence in Revenue um with casual games alone making up 60% of the total inet purchases in the last year and you know we do that kind of overview for for each different you know region you know when you look at Latin America action adventure and action games meaning platform fighting you know those types of games are the two top game genres uh among at least when you look in Brazil in 2024 um so I think it's it's really interesting to note that different you know the different no it's not a surprise to people but different genres will be more popular in different regions and you know how does that impact the way you approach the business not only for monetization but you know what you localizing where are you doing your your sort of soft launch tests and

and all of that um and you know what's great is I think that represents a healthy ecosystem where you know you're getting a lot of variety happening around the world and and then that extends into you know what we're seeing even with with the web Shops and and how people are engaging with them from different places so a lot of information in the report uh to that that leans into what you're talking about or asking about so I'd encourage people to check check that out yeah and one one element that you had there is like the Middle East is investing heavily in gaming and aiming to establish itself as a Global Hub by 2030 so you've you've probably traveled recently to uh to Riad right since I have I've been there a couple of times this year yeah tell me I've never been like like what's uh what's from not tell me in terms of like a tourist but but like in terms of uh in terms of shockingly there's actually a Mexican restaurant there that is really authentic which that's the whole side

run by Mexicans it was some some people that uh yeah had sort of immigrated there and and it's amazing it's fantastic but uh can can talk about that more offline but no look Riad uh and Saudi Arabia in general um I I found it really welcoming and um you know from a business perspective they are Saudi Arabia the kingdom is is the only country in world that has a national mandate and you've talked with Brian Ward before multiple times so your audience has heard this you know but they really have a national mandate uh to grow the games business and the gra games ecosystem and this is all part of their Vision 2030 uh initiative where they have a goal by the year 2030 to have really Diversified their economy and many many countries in the Middle East are looking at this as well as they're trying to identify what their future looks like after you know

oil kind of you know they don't want to be tied to an oil economy forever because obviously that's not sustainable um so Saudi Arabia in particular has this amazing Vision 2030 plan that touches multiple sectors and gaming is one of them and and it includes Esports and we talk about representation you know uh Saudi Arabia actually has the highest percentage of female Esports players uh out of anywhere in the world which is they're they're nearly 25% uh versus I think 5 to 7% average worldwide so it's it's amazing um the the you know what's going on there um that also means that there's been a lot of Investments and funding and you know one thing that that when you go there and you talk you know they're really looking at how can they incre build up an ecosystem within the country right and I think for anybody who's looking to do business in in you know the kingdom or even any any other countries in the region you know a

lot of times people go in pitching like hey here's how I'm going to make you a lot of money give me an investment make you a bunch of money right and it's like exactly they don't need more money they it's like people of course people like money but that's not the that's not their kpi that's not their currency it's it's job creation right so you know they're really looking at opportunities that help to create jobs within the kingdom and and um you know are supporting things that that do that and that's part of where we've partnered up to uh go in and and help with bringing some events to the region and opening up an academy and and an office and things like that um you know because we believe it is a fast growing Hub and it's a great place to be um so there's a lot of interesting things happening there it's it's a great City to go visit they have some really cool uh sort of modern buildings and architecture there they're building a whole city uh in and of itself which is focused on on gaming and

Esports uh so a lot of really interesting things going on there and um I was surprised everywhere I went people spoke fluent English felt very welcoming uh so it was it was it was a great experience that's awesome that's awesome and um no i' I've heard a lot a lot of interesting things about it I've again never visited I I came back from Abu Dhabi just just last week so I can I can imagine different cities of course different regions but there were uh it was a Google event and there were uh Founders from Riad uh who were you know really keen and like like sponges on just trying to get information and you know super energetic and and excited about everything so it was kind of great talking to them like how how energized they are unlike we old cats like oh industry is down we've seen everything they were kind of like full of energy well that's exactly it I think you know gosh the the average age is in the 30s

right and you know people are educated and techsavvy and you know the majority of the population identifies as Gamers uh so it's it's just it's a great place you know highest percentage of Internet users uh and Gamers worldwide actually um it's it's sort of the what is it the 19th largest online gaming Market in the world uh which is which is interesting right you wouldn't think that no I I need to make my way there one day um so let's talk about something that I have been following which is the impact of digital Market act the good old dma and and there's a lot of things that that have been happening in the dma so like the way I see it from the uh you know it's a where do I even start unpacking like from from the lenses of the dma so the digital market app it's a App Store distribution is seen as a public good utility that needs to be operated in a

way that promotes competition which is really different than than any legal measure where you check if this is competitive or not but like no you check if it's truly promoting competition or not so it's like a vice versa you have to show that you're promoting competition and um and and you have to show that you're creating a fair reasonable and non-discriminatory policies that aren't preferencing your own products nor blocking competition and of course like we we're very familiar with app stores and this is exactly what they've been doing and and it's been uh it's been interesting how especially Apple has been reacting to this because like the idea of of dma and and what we got out of it when we were when it was coming out and like the uh the the sort of idea behind the the the what is it a law or you know however you put it it's it's uh apps are able to link to web stores and offer third-party payments app stores should allow s loing and thirdparty app stores uh and

developers have access to more complete data from the data from from these App Store platforms but then again when we go to you know the practicalities like there were these crazy suggestions that came in from Apple as a proposal where they going to take 70% from alternative app stores they're going to take 3% processing fee they're going to put in 50 Cent annual core technology fee for every download that goes over 1 million um they're going to put in their rigorous checks and different kind of scare screens and also on top of all of this there's going to be just one decision for the entire organization so you can't even try with one app like no it's it's all or nothing and then if you want to come back you can come back once and like and then after that it's a it's a done deal so it's been it's been interesting to kind of see what's happening and the things that we've been watching is like how do these link outs um what is going to be the decision on those and also this tied to that is the

Apple's anti- steering policy so basically the way they saw it is is if I'm watching a YouTube and I download an app uh from YouTube from the ad they saying well technically because you downloaded YouTube through the App Store so this is also you know uh taken through the uh the the the idea that it's also going to be through App Store and you can't use the uh the linkout there so anyways I'm going to the weeds but what's going on with dma right now yeah I mean look the dma is is robust uh I'm really you mentioned all these sort of anti-steering you know all of these high friction kind of moves that that Apple has made to dissuade people right from uh benefiting from the dma and the EU the European commission is they're not dumb they they're keeping an eye on this uh they just announced last week that they will uh that Apple will become soon become the first

company to get a fine for f for violating right the dma's rules around all of this anti-steering stuff uh you know I think I'm waiting to see what that fine is Apple had had previously been fined $2 billion in March uh for not you know embracing the dma and now they're facing a fine that is potentially um 10% of their annual global Revenue that's a lot of money which is a lot of money so that could be $38 billion and that doubles if they get tagged for a repeat offense so you know that starts to move the needle for for even apple right two billion eh you know maybe they can shrug off but 38 that could turn into 76 billion doll uh both in the same year um you know that that's meaningful so I'm really curious to see the European commission enforces that I

don't think anyone expects they're going to drop the full 10% Hammer right and obviously Apple has time to respond and cure and all of that but it's good news overall for the industry where you know as you mentioned the intention of the digital markets Act is really to force these Gatekeepers uh to to open up and allow more fair uh practices on on their platforms and you know it's interesting we talk about this in the report you know we highight that there's over 10,000 online Platforms in the EU digital economy right now but the the dma only applies to just a small number a handful like half a dozen uh because it's really meant to go after the true Gatekeepers and to qualify as a gatekeeper you have to have certain yeah um so you know I think I think there's a lot going on there we're going to see a big big move happening when once we see what happens with this EU fine and that will I think think really indicate how open and how quickly do these

Gatekeepers open up uh which is just a huge benefit for for everybody out there right being able to go direct uh steer people out to web Shops and and give them a b more sort of expanded experience with your game uh is is hugely beneficial and and we have all kinds of data to show about that what's your perception of like it or expectation what's going to happen with this because it seems like the ma is you know or european commission who handles this is is quite serious they are serious Mishka I think um look I think there will probably be some sort of fine that comes down and I think you know sort of how big that is and when there either be a fine or apple will have will make some changes right it it's going to be an either or um and they are serious I don't expect it would be a small fine you know European Regulators have shown no hesitation to find uh you know us companies uh heavily

um the the Russian Google quadrillion Fine Thing aside right um but realistic fines you know it's it's it's a real thing and and companies have to pay attention and and then furthermore you know something that people haven't really been talking about yet because this is new also is the EU commission is not sitting back right dma is out there it's in effect they're starting to regulate it and and and enforce it um but now they also have something called the digital Fairness Act Right which brings in a whole new host of uh regulations around combating dark patterns and addictive designs uh meant to simplify subscription cancellations and then increased compliance complexity uh in regards to how uh you know companies have to be compliant so you know to your question how serious are they you just look at what they're doing right they've announced fines they're bringing more regulations so they're not

backing down on this that's that's good for the industry and do you think that that uh that European commission is kind of leading the way and there was going to be just like with gdpr there's going to be ripple effect in the US and and other uh other geographical Geographics or countries yeah absolutely I think from a a a comprehensive standpoint they're leading the way uh obviously here in the US we we did just recently pass uh a a law a regulation rather about uh making it easier to you know cancel subscriptions which is one part of this digital Fairness Act uh so I think you know there's some parity there uh but from a comprehensive standpoint and from the I think if you look at the Spirit of it of truly you know opening up these ecosystems and making sure that they're fair and they're level playing Ground uh the EU commission is is definitely out out in the lead but others are are not far behind interesting interesting well um all

right well let's talk about the the next topic which is the uh I want to kind of talk about web shops because it it it has such a good segment or leway from this because the I mean the web shop is one of the biggest Parts uh they're going to benefit from from all this uh dma taking into place um what is your and and this is also the unique Vantage points of exola because you are the biggest web shop providers and you have the most clients and you see the most so so what's happening with the web shops yeah this is I love it what's happening here so you're right we we do have a great view into these um we have over 400 web shops now that that we support and that number is just accelerating uh every day uh and and this is in less than than two years right um it just truly has exploded uh so that that's great and everything but I think what's really really interesting and and your audience will probably appre appreciate this is that when we talk with mobile Gamers uh we we found

out that they're very aware of of web shops and alternative you know platforms to go to uh from from our research we see that 81% of players say that they are aware of web shops they know these things exist so you know that's a huge shift in a very short period of time where it used to be that you know if you look back at Social Casino which kind of led the way with these off platform uh offering ings it was a pretty niche market right a small number of players uh and now companies have really cracked the code on how to message to players make them aware of these uh platforms and and start using them uh you know we see that um not only do 81% of players say that they know they exist but we found that 77% of players actually have reported making at least one purchase on a web shop uh so this is this is huge news for the industry wow and and you've seen so you've seen the rapid growth and what one of the

things that I've when I talk to different developers and like how they've benefited from web shops most of them have the ones who haven't are those who are making very casual games have you seen this this the same thing is like web shops work extremely well with midcore audiences core audiences casino but then the more casual we go the less there's an there's an impact from web shops yeah I mean that that certainly has been the case and um I'm actually going to pull up something right now but we overall for sure I think the early story with web shops was that um when you look at sort of midcore and core games that's where you're really seeing you know a lot of the benefit um you know we have a number of CA so if you if you reach out to us you know we have a lot of info in the report but then we have even more information specifically for people interested in web shops and we have a number of case studies uh and just to give you sort of that that

difference there um I'm going to try to pull a couple of these up but uh we see that yeah when you're um you know overall we're seeing like a 4ex strategy game for instance that that we it's Anonymous we don't share who or what they are um but we're seeing that this Forex strategy game on their web shop they have a capture rate of greater than 45% that means the number of players in the game who are coming to the web shop um the average revenue per paying user and this is just astounding is is $3,100 $3,100 um and uh the the web shop Revenue uh is is substantial right uh the uplift on the overall game revenue is um on this one and is probably a third overall of of the revenue of the game um and then you know if you kind of look at sort of more

of a casual game you know the the case study we have here is more of a kids RPG um you know and there we're seeing lower numbers obviously as there should be uh but still pretty interesting about 30% capture rate um little over $100 revenue for paying user so even on games that tend to be younger and more casual we're starting to see a growth of of web shops um so it's it's a great business just overall yeah yeah okay good to hear that and and I I kind of the way I assume it is like the stronger Community you have uh the better the web shops will be functioning because the community is often outside the game you know whether on web or or Discord or other type of platforms and that opens up the ability to connect with the community and through that you know a segue to to web shops yeah absolutely and and we share you know some tips for Success right when you're running a web shop in in our

report here the uh the exola Autumn report for 2024 uh and then we have much deeper set of best practices you know from our web shop team when you when you start working with us but you're 100% right Community is key uh you know anybody who excuse me thinks of a web shop as just an online version of their inapp store and and does nothing else is going to fail you know web shop really takes off when you treat it you know as an extension of the game not just a mirror of what's happening in the game um but an extension where you have the same feel and the same branding and the same look um and and offers feel like a natural continuation of the game um continuous communication right always communicating with your your players and building up that Community minimizing the friction on on the shop to reduce churn these are all really important important um and then the big ones focusing on value right you got to think

of what is the value proposition of you know what is it that a player is going to get through a web shop that is more value or not even necessarily more value but of different value than what they're they can get in the game and then P you know leveraging the power of live Ops really treating this as a a a true platform in and of itself where you're you know not just running different events throughout the week and I don't mean gameplay events although you can link and you should link these to events going on in the game but even just you know turning over what's happening on on the store Page uh you know tying into maybe your meta a little bit more uh through the types of offers that you're giv giving and treating those as events but then also the analytics like really analyzing the players and you know what we didn't talk about with things like the dma and with web shops the connector there is um through these regulations with the dma and through through going direct to your player outside of the app

stores you actually get a full set of data uh much more data than you get with just the gameplay data normally that you normally receive so this allows you to do better acquisition you know create better offers even targeted offers there's a whole host of things that that you benefit from there and and you need to take advantage of if you're going to succeed yeah yeah that's a that's a very good point so operating the web shop just like you would operate any kind of a experience it's not just enough to put in the bundles couple of images and here you go you know you can buy it there you can buy it here do whatever you want but just like any kind of a web shop you know what whatever web shopping experience you use there's always different things there's always new stuff coming out and it's like there's a reason to go back to the uh the web shop and and that applies the same way to games yeah absolutely and and we you know we do have we have some general case studies that we talk about like I just shared but we also have some specific ones um tilting Point has been

a great partner over the years and you know we really talk about our they share with us and we're we're happy to share with with you know everybody out there sort of their perspective on what's worked with web shops uh you know they have a number of games Warhammer chaos and Conquest Star Trek timelines uh that have really benefited from web shops and they they go into detail in our report on on their sort of what has helped them succeed and some of the metrics so I think that'll be of interest to folks interesting all right some more web shop information step into the future of game monetization with exola exola empowers developers and Publishers to market sell connect and optimize their games globally from payment solution to a full suit of tools designed to grow your game's Revenue while fostering a lawyer player base exola is your game's gateway to worldwide success with exola the world is your playground visit exa.com today and find all the solution solutions that will help you to power your games into success

everywhere just connect with exola naturally um last one cross media integration so this was interesting because this is something that I've not heard about and not really you know I don't know what Amazon's secret level is which is a game inspired an anthology Series so can you talk more about like what this cross media integration trend is about yeah I think you know look you you all talk about this a lot on uh sort of on on the podcast with whatever you want to call it trans media oh this is trans Media stuff exactly but I think the the general idea here is just you know we're seeing and especially as we're seeing much more of a connection of of um interests right for players around around their games whether it's new types of media content uh new types of community or fandom or whatever it may

be but we're really seeing you know a lot of benefit from companies that are leaning into this cross media and and really bringing it all together and I know it's a little disjointed but when I say bring it all together you know now that companies are able to actually operate their own platforms and we've seen this on PC for a long time right but on mobile now that you can have your own web shop you know the next generation is really thinking of it Beyond just a web shop but as kind of a your own platform platform where you can link everything together that your players may like and you know whether that's directing them to you know fanfiction or shorts or having you know your own messaging boards up there your own Community uh everything linked around the game you know I think this is really really driving some higher engagement for players and uh something people should start it's still early you know I think the best practices are still up in the air you know the timing of things is needs to be worked out but it's an area worth looking into and we're starting to to track that a little bit here what's the what's the

connection like um like why why trans media is so important for you to track is it because trans media is seen as some as a as an Avenue to overall growth of the gaming um Market is is that yeah I mean it's it's exactly it's it comes back to a word I had mentioned uh a few moments ago about web shops but I think it's it's a word you could apply more which is value right what value are you uh you know bringing for your players and you know I love to talk about how with games there's there's two ways to think about it about games you know there's the old way where people think of games as just this you know Silly Pastime it's something that you know just a few people do and it's kind of a it's a kids thing right um and that that's completely the wrong way to look at it you know the way that I look at it now and what ties into what you're asking is when you look at games as a hobby right and you truly think about

this as somebody's number one hobby this is what they prefer to do in their spare time and when you think of it through that lens and you look at other Hobbies right whether it's things like golf or sports or mountain biking or theater or whatever take your pick right there's a whole host of things that people engage with as their primary Hobby and when you think of it that way it those Hobbies tie everything together right if you're a golfer you're of course you're going out and playing golf you're looking at clubs you're reading things online about them you're watching shows maybe you're watching Happy Gilmore for the hundredth time whatever it may be but um you know you're engaging with all these different pieces of content because they're they're adding value to your hobby experience and I think that is what is interesting from a game perspective that this industry really is matured and and you know people are treating it as their primary Hobby and that creates the opportunity for linking a lot of

different you know content together which just increases the overall value proposition for the for the you know consumer um but also gives a lot of opportunities to find new ways to increase engagement and and grow your game interesting well fascinating uh it's a really good report uh did we leave something uncovered oh my goodness I think we went pretty pretty deep not as deep as the report goes uh almost 50 pages and then we have a lot of additional materials to back that up for people that want to go even deeper so this has been great you know I really appreciate you know your your time with this Mishka well I appreciate you and and and I want to say to everybody that they should follow you on LinkedIn because you do a lot of surveys you you share a lot of interesting information your LinkedIn page is uh is is really booming like just recently you talked about military veterans and G so I went in and kind of like you know you have you have a lot of interesting

stuff so I I highly suggest that that people uh follow you on Linkin so again Link in the description below oh I really appreciate that Mishka that that means a lot thank you well thank you everybody for for listening and Chris thank you again for coming on the podcast and and kind of updating us on on how the industry is doing for a very unique vantage point of uh the biggest largest um you know arguably the best web shop in the business thank you happy to be here and happy to come back anytime all right well thanks everybody and thank you Chris byebye thanks Misha bye you did it you made it to the end of the episode as a fan of the show it would help us out if you'd subscribe and leave us a review on the podcast service of your choice those stars and likes while the small action on your part mean a lot to us and help to grow the show more importantly are you a member of the Deon Constructor of fun slack group if you have 5 years or more of games

industry experience go to deconstructor of fund.com SL slack and apply to join Jo the games industry best professional Community filled with peers always willing to lend a hand or subscribe to our newsletter to get all the latest insights from the deconstructor of fun content creators thanks for listening [Music]