Supercell Cancels Floodrush / Gamescom Highlights / Epic’s Revenue Boost

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hit like a tsunami so it also it also feels like uh everyone everyone wasn't like summer or like at least the European side uh summer vacation and people are starting to come back uh so news are starting to pick up after Gamescom for sure yep yep yeah definitely we're gonna be heading into fall as well of course at some point and then you know stuff for winter I'm sure we'll be ramping up but uh we have we have a lot of topics covered today a lot of stuff as you said the news ramping up we have some uh a lot of stuff like as you mentioned Gamescom highlights uh we've got some small matter news around supercell following up on a previous topic there uh epic with some Revenue changes Sony with a little bit of news on their side sand soft with the new CEO and embracer with some stock uh issues I guess but let's just dive into supercell stuff real quick uh yeah so I wanted to do a quick update on supercell flood Rush one of the games that they were running beta closed beta on earlier in the summer so we talked

about it back in an episode in June uh just when they hit with uh two betas flood rush and Squad Busters as a reminder both games being Battle Royale kind of build your party during the match trying to reach the final you know kind of very very much Battle Royale ask both of them and this week they announced that they were canceling flawed rush in a very super cell type way of celebrating killing games some of the the comments that they made were uh you know they identified several issues with and pretty much they called out everything gameplay mechanics controls character Dynamics um art Direction uh you know the the feedback across the board seemed to basically say a you know that it was not worth for them uh continuing developing the the game to really meet the supercell standard right so it's it's very different standard than a lot of of

games like they are in this constant quest for finding hit games so you know it's not it was not hitting that that bar and you know they even call it out in their announcement that they would need to make huge and extensive changes to the point that it would be completely different game which at that point it means you know they're better off starting uh a new game so I do want to call out that this is another example of super sale celebrating something that a lot of teams and I've been on this on this end of the of the spectrum where it's very hard to kill games cancel games however you call it and instead they're you know trying to celebrate the the fact of not making it feel like a bad thing to cancel game but really take the learnings from there uh they even call it out in their in their post that ideas and insights gathered uh while developing flood rushkin in many forms be applied to

other projects and um they didn't call out any specific games but you're not even thinking about like Squad Busters uh that it's still in development um is probably one of the games that will will benefit from the learnings and uh just to kind of close off as as a reminder I think at this point we have two games inactive Dev from supercell we have Squad Busters and we have Clash mini the auto battler kind of Auto chess type game that's been in South launch since November 2021 on I was looking at their data in data.ai and it sounds like um they might be gearing up to either gather some more learnings or uh launch the game because they did a big push in July as well opening up in the UK um and you know they got very good traction there over close to 200k downloads uh it seems to be holding pretty decent Dau but still

um Revenue seems to be flattening so we'll see where where they take Clash mini but um super so it comes with a reminder that it's always okay to cancel games well I I don't think we'll see them do that strategy of just kind of dumping a game out there again that was that seemed to be kind of the experiment with this that also didn't seem to get the traction as opposed to their two games as you mentioned kind of soft launch for a while here probably much more likely to make it out but I just say I don't imagine we'll see anyone like just trying to copy flood Rush either so it's probably just kind of dead in the water yeah I remember when we first talked about both of these games I think it was with Tammy itself and uh we were kind of saying that you know Squad Busters is basically the same game as flood rush just that Squad Busters has the you know the various supercell IPS and uh flood dresses is a new IP um we recently released a you know strategy uh genre report and in that we

kind of uh Jordan um who's uh who's a Consulting partner at navic uh he kind of did a little piece on you know what is what has various supercells games missing more recently and why trying to like just explore like a slightly new theory for why they've why they're canceling so many of their soft launches and um it's not it's maybe like not the newest inside because probably everyone in the industry feels this but you know uh the core Insight was that supercell basically or like a lot of their games that have gotten canceled have just kind of missed the essence of the genre that they are trying to you know redefine uh in a way and um so for you know for flood Rush uh specifically it's kind of like um brawl Stars meets uh a guard.io in a way you know and

um but you know what kind of makes uh brawl Stars great is you know the aiming and timing of of your attacks and movements inside so that's a hugely important skill and you know just the hand-eye coordination and you know deep understanding of the brawler strengths and stuff that kind of you know uh that kind of gives you an edge in the battle uh but in agar.io your cat you're like this amorphous uh blob you know and it grows larger by eating smaller blobs um but then a very very key feature in in that game is uh the splitting or merging of your blob uh and that's like a that kind of creates like this risk reward um decision in the gameplay uh which you know doesn't really exist in uh in flood rush or even Squad Busters for for that matter so we kind of concluded in our flood Rush slash Squad Busters analysis that

basically the game missed the essence of you know both these brawl stars and Dot IO it just didn't kind of come together and I don't know at least for us uh the writing was a little bit on the wall in that report itself that you know flood Rush is probably gonna get canceled and and yeah I think like what a week later it was announced um yeah and yeah maybe they learned from it and kind of reinvest into Squad Busters but you know I think I think the one sentence that they made at the start of that of their blog post they basically said um we need we needed to make extensive changes to the point that it would transform flood rush into something too distant from the initial vision and if both Squad Busters and this one are so similar in terms of gameplay you know it's it's like which God Busters also need to move like very far away from its initial Vision you know uh and um

so yeah maybe maybe squat Busters has the same fate but yeah more bullish on Clash mini yeah yeah and I think that um you know there were like some key distinctions between flat rush and Squad Busters where I sing at uh you know potentially Squad Busters might have a a better shot at at surviving um the other thing that that as you were talking that really stands out to me is that um you know generally speaking you know what what is supercell trying to do is when you were saying we reinvent reimagine core genres and bring them to broader audiences one of the things that I I feel like you know they're really good at is creating Gorges worlds and art you know just amazing art um for the mobile form factor and some of the games like flood rush and even everdale have been trying to challenge that establish look and feel from from super sale that doesn't seem to land

um as well either so I think that there's yeah there's a lot of things that that we're going into uh flood Rush not not having the shot at really being a supercell hit I I think Super still does best when they're making small tweaks to already establish genres uh like you said Tammy like bringing it to like a much bigger audience um I just hope they're not dissuaded by all of the recent game closures like you know we had Rush Wars Heyday pop Clash Quest um everdale like there's really no shortage of closures and everdale in particular was kind of a bit of a head scratcher because I thought they could you know maybe redefine the town building Sim genre there um which has gone gotten quite stale but you know I I I I'd rather see them create projects and you know keep iterating until something sticks and they can have a hit then you know really

not try to um be Innovative at all I would say that I think I think saying that uh supercell does best when they make small tweaks to existing genres is is probably a big understatement I think it's like a little bit on the other end of the spectrum where supercell basically redefines the genre by simplifying you know um uh like for like Clash mini for example it really just takes the essence of what what makes an auto battler interesting uh given that auto battles were kind of created for you know the DOTA uh Community First and not for a mobile experience um and it just takes what's interesting in that Auto Battle experience makes it mobile first and therefore like you know increases accessibility inside so it's some pretty like those those simplification decisions are definitely like one of the hardest decisions I think in game design just given you know um just given like you have such a strong inspiration that will keep clouding your decision making you know

design decision making um so so yeah very very hard decisions and therefore you know people who are able to pull it off can't see like very good success like supercell so well sounded like based off of what you said about uh the agario and uh the Way flood Rush turned out maybe they oversimplified like over corrected a bit into that range flash windy is actually like yeah it it does do a good job of this implication but yeah on flood rush I feel they just missed features entirely like yeah they just missed the things that make brawl stars and agar.io great and I'm not sure why but yeah well the nice thing is of course they're gonna be able to turn those learnings into uh things that will contribute to Squad Buster's I imagine uh probably not a huge amount right because they were already like had some key differences but I think we'll we'll see potentially some changes down the road to that game and hopefully a release they definitely put their stuff at soft launch for quite a while uh so

I'm looking forward to at least seeing Clash mini come out at this point just because uh you know it's been a long time it's been kind of dwindling away uh but they've been improving on it right you know iterating on it and so uh I don't think that's going anywhere other than Global someone here hopefully but uh speaking of announcements uh with a lot of stuff coming out of Gamescom as you were just that manual yep yep um I mean uh yeah to be fair like I was basically just stuck in a lot of meetings during my time at Gamescom whatever time I did kind of get to see the show floors and stuff uh I I did visit but um but yeah I mean you know uh thank goodness for you know sources like IGN and stuff who basically kind of keep a tab on all of this uh but yeah a lot of a lot of interesting games got announced so I'll just kind of go through this in Rapid Fire um and maybe like a few comments here and there so probably my um probably my favorite one was uh you know black myth uh Wukong that can we

got we got to see like some gameplay uh on that uh it's another like Souls like game that's been in development for some time now but it is looking really really really good um and it's currently sitting at number 13 on you know steam's uh top fish listed games but uh beyond that there were like a lot of other interesting games also kind of announced one was payday uh announce but you know just kind of brought up but payday 3 um which is also sitting at number six on um you know steam's top fish listed games so yeah probably you know maybe a good sign for uh embracer a little bit uh stalker 2 uh was sitting at number nine um lies of P I actually and it's another source like I never knew about this game before but it's based on Pinocchio and also looking really really good uh Pinocchio you know uh Pinocchio uh themed uh or uh you know uh Souls like

which but yeah kind of like surprised me um what did like surprise me even more though was um I mean even Mortal Kombat one um you know showcase like more gameplay and such uh and Gamescom but uh for whatever reason this seems to be like you know maybe the best at least to me like just the best Mortal Kombat until now maybe mk11 is is better but this one did seem really good but it is sitting like pretty low on the steam wish list wish list chats at like number 60. um but yeah I mean the single player mode looked really really good um and yeah I've just kind of surprised why it's like so low at least on the wishlist charts um other than that um Homeworld uh so yeah this is kind of big news but Homeworld is coming back after 20 years uh with Homeworld 3. and the apart from like you know the kind of the core home World experience

that you know they'll be you know refining and upgrading uh they have like this one roguelike inspired RTS mode uh and that's what at least the developers are pretty excited about and marketing quite a bit um one thing I'm pretty curious to see like after 20 years you know homework coming back will Homeworld also kind of have like a battle Lord's gate moment with this launch uh and it'll yeah I'll again be pretty interesting to see again yeah homeboy potentially good news for embracer uh given everything that's happened with them if Homeworld has uh has a moment like that if it's a moment of of reigniting the RTS genrex that's also one that's been kind of quite stale last few years so it'll be it'll be interesting to see if if they can get that that big moment I think it can also reignite a little bit of of the RTS genre um and then yeah this is and then like more on the I guess cross-platform

mobile side of things um one super interesting project which is maybe like competing with you know black myth for my favorite position is net eases project Mugen so um this one I think yeah this one was freshly announced at Gamescom and imagine like like you know cyberpunk theming uh meets um you know genshin impact open world action RPG experience meets uh Spider-Man movement and like kind of swinging around you know the city so uh so yeah the way they Define it is or the way they describe the game is an urban open world game um and its core Inspirations like I mentioned you know uh their movements are heavily inspired character movements heavily inspired by Spiderman combat and uh environments and such heavily inspired by against impact or graphical uh you know graphical Fidelity and

production quality and themes is like heavily inspired by cyberpunk um the one why I found this like super interesting is because you know when Tower of fantasy was announced um I personally felt it was kind of like you know DOA because it just looked so similar to gentian impact and like you know why there was no clear reason for me to switch but just kind of given just given this more like cyberpunk you know uh cyberpunk theming and you're kind of in a real City and moving around and it's so familiar in terms of like our own daily lives it feels like very very strongly differentiated to gentian impact experience and you know um that kind of makes me pretty bullish on on this game um the thing that might like temper my bullishness is that you know whether netis can really deliver on you know gacha based RPG

monetization systems uh I don't think they have I might be wrong here uh I don't know I don't think they have like a major track record like a proven track record with with those kind of systems um the only game I was able to find that has like some you know some um hints of it is maybe on meoji which is an action RPG kind of similar to honkai impact um but but yeah I think this is probably like a big unknown and maybe I'm wrong and I'm missing some games with Netties that you know actually do gotcha-based RPG monetization but I think that'll be a pretty big unknown um or pretty big um you know thing that they need to prove out but but yeah finally I guess in terms of marketing we'll see it they're just gonna go pretty all out on this you know when when it does when it is ready similar to like gentian uh you know I know uh Hong Kai started also did and it'll just be pretty pretty heavy on the brand

marketing efforts you know huge Billboards buses with like posters of this game on it and whatnot so should be pretty crazy um yeah as you as you were describing it I was Googling some some images of uh project Mugen and it definitely stands out compared to honka and genshin in it so I think if it has you know as you said if if they execute on the on the gadget based mechanics in that depth uh I think it has a very strong shot it if nothing else canonizing a little bit from from genshin I think that honkai has already cannibalized a load from from genshin anyway so you know I think I'd I'd worse if they executed well they they can cannibalize into that market at best it can expand the market and just the reach of these these types of games yeah globally impact definitely needs to be ready for you know potential impact and so so

let's see what happens um and then another mobile one probably the last one so um assassins uh so Ubisoft also kind of um put out their first um you know gameplay videos of Assassin's Creed uh Jade uh they've dropped the code name from it so now we have the official name to be honest I was a little bit underwhelmed with the production quality of this it really looked like uh you know like a I mean with with experiences like engine impact and project Mugen kind of staring me in the face and telling me that you know they're they're going to be available soon this game looked like you know something that was built like five seven years back and I was really for this IP you know Assassin's Creed I was really expecting more um it might be an open world experience um not fully sure um but you know uh idea and also kind of

did like a interview with um but with someone important from that game team and um and one red flag that kind of popped up was when IGN asked him like you know what's the monetization plan for this is going to be free to play or not uh he did say yes it is going to be free to play but in terms of um how exactly that works like he he didn't even say like we're thinking about it and we can't reveal it but he said now we're just focused on gameplay right now we'll figure out the monetization later and that felt like for a free to play game you know that felt like at least an orange flag for me um so so yeah a little bit disappointed with you know the production quality um big questions on the monetization strategy with Assassin's Creed Jade uh but but yeah I mean it's the gameplay did look good um for an Assassin's Creed game and I think they should be able to deliver on just like the core Assassin's Creed

experience and kind of keep those that core fan base uh pretty happy um I mean I'm really excited about um part of Chernobyl um GSC is kind of one of my favorite underground developers I was a huge shadow of Chernobyl fan that was one of the first games I ever played on Steam back in 2007 um and I'm just really happy that they're going with Unreal Engine five um rather than their in-house engine that was used for previous stalker titles um you know those games have incredible gameplay the survival horror elements are you know amazing but the technical glitches were enough like they were Beyond kind of like the set of the level um and uh I'm just really excited to see more Studios use Unreal Engine you know um CD project also comes to mind um they're switching to that from Red engine uh and I'm also happy to see the developers have been in the nfts there was a huge uproar in the community about um nfts being integrated into a stalker

game and I feel like that's just an instance of the developer not under like knowing their fan base you know most stalker fans are not like the same crossover as like nft type Gamers and um yeah to see a developer listening to uh their community yeah I was I was following I was following uh the the Gamescom news and uh what was also interesting to see was um I think it was from from mobile gamer um Neil posted some photos of the booths and just seeing very like mobile mobile Centric like huge booths in a time where we feel like we're squeezing on on mobile and like things are tied on mobile uh and seeing just um you know anywhere from like Marvel snap to Netflix to I mean um hoyovers it's a it's a huge Global developer but

you know just seeing like these huge uh fancy booths back um on on the floors and just like the photos of that like that's that was that was pretty pretty crazy to see especially the Netflix one I think that that one's like you just like it feels out of place I was there I I did see the Netflix one with you know like the upside down uh you know those creatures kind of taking over the buildings and such um I mean who your voice is actually even last year's Gamescom had a huge booth and you know they I guess they can kind of afford to do it now the one that did surprise me was just like a Marvel snap Booth so that was kind of huge and it was also like pretty empty actually like no at least you know on the first day when I was there maybe it filled up later but that one just surprised me like you know booth just dedicated to this one game but um yeah because yeah you're right like however is in Netflix like Netflix and

feels out of place is like more of like out of context like the Shifting the mentality I think they had like they were serving pizza and stuff inside that boot so you could like get into a line and get your pizza slice and then walk out do it but yeah no but they're I mean they're building a a huge like publishing uh in in you know portfolio publishing portfolio so it makes sense to have kind of the the big Booth presents but yeah marble snap single game mobile game recently gone across platform huge Booth that's pretty crazy to see yeah I guess for Netflix when you don't have like the hard-hitting game portfolio then we need to give out the pizza anyway I guess at that point they're just trying to get attention for that shift you know just trying to make sure people are aware that they're moving into that space pretty heavily and like that's like a signal flare basically at that point rather than anything useful and of course people are going to get the free pizza right take it especially

when I imagine food might be kind of expensive there so it's probably a smart tactic on their part although the Marvel snap one to sound a little questionable for a game that's like if you haven't heard of it you're probably not interested kind of thing so but uh Sony actually had a couple interesting announcements that were a little off uh our expectations yeah so about a week ago Sony made a very surprising announcement um to purchase uh Odyssey who is a headphone maker popular among audio files for their unique driver technology um and I think this just came out of left field because there are so many other kind of gaming first peripheral companies like Turtle Beach for example comes to mind um that I thought would be purchased first um by like a Sony or a Microsoft uh but um you know in recent months Odyssey has focused on their gaming headphone lineup including the wireless Maxwell line for PS5 and Xbox series X

um they retail for 300 and the audio file uh wired gaming headset the LCD GX goes for 900 which is like twice the cost of a disc list PS5 so I I found the acquisition to be a head scratcher because it's clear um Sony wants to boost their Hardware lineup as shown by the launch of psbr2 and the pulse 3D uh Wireless cans that came out a few months ago but those are for a much lower price point at a hundred dollars and you know someone would think that um there were a lot better acquisition targets um available to Sony for their uh Sie division um one Theory I have is that um a PS5 Pro bundle is in the works um so PS5 Pro itself is still in rumor mode um but there are some Rumblings that could be released for Holiday 2023.

um and I think there's probably room for a bundle around a thousand dollars with like a disclosed version of the PS5 Pro as well as um a PlayStation branded Maxwell headset um and you know a few new games like armored course X Boulder Skate 3 payday 3 um but yeah I think it's kind of just a um uh price differentiation strategy that Sony's experimenting with and uh you know speaking on price uh the news broke today that um PlayStation's uh Subscription Service uh would be increasing their uh annual price the essential plan is going from 60 to 80 the extra plan is going from 100 to 135 and the Premium plan is going from 120 to 160. so this one is even more confusing to me because this is happening after Sony failed to convince any regulator um to uh have Microsoft abandon the app

division acquisition and Microsoft's catalog um is pretty much a doubling um in the coming months whereas Sony like sure they've acquired Bungie and a handful of other Indie Studios but um like I I feel like they're not in the position to increase um they're offering like this fast and that dramatically you know 60 to 80 is like a 30 increase um and uh yeah I'm wondering what you guys think about um either announcement yeah at least on the hardware part of it or Odyssey these um I think I kind of I didn't have exactly the same Theory as yours in terms of uh the bundle but I mean that makes complete sense um but but yeah I guess for me it was just you know it kind of made sense in terms of you know Sony essentially trying to expand you know its various customer touch points by opening up you know potential new product lines that just kind of

amplifies its core offering and headphones is like pretty core to you know the gaming experience so why not kind of make it a Sony one yeah instead so um but yeah I mean I think the bundle Theory also makes sense um on the price increases I don't know um I would never think about that um random maybe Tammy has some thoughts it's uh it's pretty it's pretty fresh new so I'm still kind of it's a little bit of a hit scratcher on on what uh what is the the driving force here for Sony specifically um yeah that that's that that's where where I'm at it right now it's as if the recent news for sure was it was it just like was it just like a straight price increase with no like no announcements of you know why or like additional feature sets or content and such was it just a plane we're just raising the prices or

yeah the news broke like 20 minutes before our recording so I couldn't dig into it a ton but even if there are new offerings within the bundles that just strikes me as as weird weird timing um given Activision is about to close maybe maybe some things will dig into next week yeah I don't think it was even really like an official announcement from Sony right it was more of like a a leak kind of announcement and so maybe there's like a missing piece to it perhaps I guess we'll see but uh it does seem like a bit of a steep because I mean we know like a lot of streaming services for example are like increasing their prices pretty dramatically so like everyone's kind of across the board but for Sony to not have much new to offer with that it seems like yeah maybe maybe the other shoe would drop at some point here hopefully because otherwise it seems like they're kind of asking a lot for what they're really giving at this point especially they're just making Microsoft look good and in that respect you know after I I think because Microsoft also recently

changed their subscription service around the the Xbox Gold and stuff right yeah gold I think is um no longer like included with the uh with the bundle um but yeah I I feel like I guess my last thought on this is I feel like Sony is trying to have it both ways you know like a printer company sells printers at a loss but then sells the ink at like a premium and like okay Sony selling the consoles at like a slight loss but now it's selling the accessories at a premium it's selling the software offering at a premium like it feels like they're trying to extract too much um I think from their user base uh at the present without uh improving the uh offering enough to substantiate that especially since the exclusivity Wars are kind of like somewhat over right outside of the acquisition game so it does seem like Sony is going to be like in a little bit of trouble there without

like those kind of exclusives to say like this is why you got to stay over here right so I guess we'll see like uh you know as things uh shift towards winter you know see if the battle's Brewing between those two if anyone has yet to choose a side because they were like waiting on PS5 stock or something back in the day but we'll see speaking of Revenue though epic uh continuing to play off strengths doing some tweaks to the revenue program yeah um you can keep this one pretty quick so epic recently or the epic game stores kind of announced a new Revenue boost system um I believe it's called first run and um yeah essentially the offer is you know people or developers who launch their games exclude exclusively on the epic game store um will get a hundred percent of the first six months of Revenue uh and then after that it switches to the 88 12 um so I mean of course you know why the why is clear just so that you

know epic does get like just makes it more and more attractive for developers to kind of go exclusive on uh on the store and therefore like you know epic increasing its uh user base um like that um but but yeah it it's an interesting I guess the question to ask is you know will it really work in terms of attracting the developers it's definitely an interesting move the value proposition is super clear but when I thought about it I guess in my eyes it's for for like really big Publishers who kind of uh have high confidence that you know what their games are going to be a success uh the the biggest risk to them kind of pursuing this is basically kind of pissing off their player base that likes to stay on Steam you know or like who are kind of active on Steam and you know that is definitely the bigger chunk of the

player base like that I can I can you know already kind of see those players just saying why aren't you like why aren't you just making it available on Steam right now and that kind of causing a pro and and things like that but but yeah I think like going fully exclusive on uh the epic game store you know if that that thing that point is not it is going fully exclusive on the epic game store for the first six months four games that can keep the hype going until the steam release you know I guess it's not really a risk but it just also kind of feels weird I it would just be interesting to see that you know whether the best developers also just kind of more philosophically agree with the whole exclusive strategy um I mean most recently most recently but like you know since balder's gate is very much in the conversation these days um um the founder of Larry and Studios when wing wing K uh in a 2018 interview he's you know he said that he's he he's not

into like doing exclusive he exclusive he wants to make his game available everywhere uh you know as soon as it's ready and for that reason Baldo's Gate 3 is still not available on the epic game store you know that's like uh so uh so yeah so it yeah it'll just be interesting to see whether like you know the really big developer is more philosophically also kind of agree with this but but yeah the biggest risk is just pissing off the your player base that that lives on Steam um I guess the the place where it maybe gets a little bit more risky or maybe for developers or just kind of Flying Blind a little bit in terms of like potential you know launch performance as soon as like you do something on you want to like when you launch you basically want to like you know um make the most of the hype uh that would be kind of attached with that launch but if you go live on uh epic game store exclusive which definitely

has like a lower you know um potential buyer base than than steam um then yeah word gets out and by the time you release on Steam you know you've just lost that upside really uh so so yeah but yeah maybe you know maybe they end up just deciding well I mean a 12 hit you know for six months maybe the catching the hype is actually just worth kind of taking that hit and you know therefore the first run program doesn't really see any success but but yeah I guess yeah for me in general the whole Revenue this whole you know first run idea it's a it's a great idea and it's a it's definitely um you know um it's something it's basically epic kind of needs to come up with these ideas to kind of get a leg up on Steam eventually in the long term um but but yeah the reality also is you know in 2022 epic game store it's Peak Dau was at around 35 million

steam speak concurrence in Jan 23 2023 so this is deu versus concurrence steam speak concurrence for 35 million in in Jan 2023 so like that just I mean steam just has such a huge scale advantage and still but EGS is also definitely catching up but yeah um I don't know what do you guys think in terms of a good strategy for developers over here yeah I mean my one sentence thought is if it didn't make sense for a developer to go to Epic for a 12 cut they're still not going to do it for a zero percent um they value engagement um those sorts of developers that value engagement more so than preserving their margin I think it seems like an obvious thing for web 3 games to choose though considering they can't go over to steam anyways right like that's kind of an easy win uh I mean I doubt that though they were super concerned about that anyways but it seems like a easy Choice

there but it is interesting like looking at the sources of revenue for both companies in the sense that like um you know uh valve is is primarily focused on a lot of the the steam-oriented stuff uh not not making games so much maybe updating them occasionally things like that uh whereas epic well they've got games like you know fortnite and things like that they also technically are making money off of games that are on Steam in the terms of Unreal Engine which you mentioned earlier Mario so there is a revenue Source even coming in a way through through the Sleep platform so what game that's the Unreal Engine is doing well on Steam that also benefits them as a company so like they're not in the worst position to try and like continue to Edge like you know margin like people away from Steam but as you said like it's not a huge nudge for people that actually care that much and it's more just like people that are like willing to take the risk anyways are just going to benefit probably like the it's I don't think it's going to change who does it it's just gonna be like hey some people will benefit a little bit more and be a little more excited about an epic start launch but I don't know I

mean I'm sure you guys can remember like you know steam back in the day just being basically be a way to download Half-Life 2. so you never know like this stuff comes a long way but as you said a lot of traction for first email although you got to keep on those concurrents probably don't like necessarily mean they were playing a game it just they have steam open but who doesn't just leave it open right like unless you're trying to like stop it from downloading things so uh I don't think people are doing that quite the same with epic store yeah so the same point this exists for the EU also right like just to log into the epic game store will be counted as a Dau but but uh no what I was gonna say from like the right now are just really trying to figure out creative strategies for expanding their distribution which means that you know news like this of hey epic is going to give higher ref share like 90 10 if you go

exclusively I think for some teams it's worth the shot because if it's less competitive even even if um you know the audience itself is smaller like your your tem uh is smaller going on Epic first if the chance of um reaching more of that audience is higher and you know on top of that getting a higher rev share off of that I think for some teams it's going to be worth experimenting and seeing if if they can actually you know have a better outcome because ultimately you know steam is is super competitive it's it's you know it takes a lot at this point to really gather the hype uh on Steam and you know really get your wishlist wish list counts up and you know it takes a lot of effort from teams as well so I think it's it's you know it there's a pros and cons that each team has to evaluate based on on

their own capabilities and confidence on whether they could even get the the visibility um on Steam even when they're a big game or a big team versus you know taking a shot at uh epic games and see if if they can find early success there instead I guess what a trying to say is like um if the revenue volume because you know there's more because if the user base on the epic game store is more of a blue ocean to capture just given like the game Count available yeah if you can if you can capture more of their smaller audience like it it's I think it is like the equation right of of uh you know how yeah how much how how elastic is that equation in terms of uh them being able to move the needle on conversions being with a smaller audience versus a more competitive bigger audience but yeah I guess even even in that case they'll ultimately the I mean yeah the Excel

sheet that is created internally will essentially to have a case too which is well okay um but if we did go with the 12 cut for the six months but you know there's this potential huge team audience also and put like a super low conversion on that you know worst case scenario but for that kind of result in but yeah I mean that's an interesting idea for sure um definitely starting to feel like a iOS versus Android sort of thing right where so it might be where some genres do better on one of the other whereas like you you see on iOS when you a lot of times when you look at the the revenue it's like there's maybe less people playing on iOS but bigger Spenders uh and then maybe the the inverse for that for Android depending on the game in the genre right in the demographics and all that but I don't I don't know if we're really quite there yet in terms of like both of them being big enough to really kind of compete in that way but it is starting to Trend that way but it's nice to have right like to have the choice there so it's not a monopoly um as much as I think we all enjoy using steam it's nice to

actually have someone nudging them continually to to improve things so you know speaking of a company you need to approve embracer stock problems yeah so I think it's no surprise to anyone but embracer group just continues to struggle um after each and every earnings report that they release you know three months ago um they were down 40 on the news of the loss of the transformative partnership that we now know was Savvy games group and then after earnings got hit again and then now um with their um fiscal year 2024 q1 earnings that came out um a couple weeks ago uh the stock was down again 16 um on the week and um down a lot after the earnings immediately as well uh and you know I think people have just soured on embracers prospects given the bloat that's present at the company um you know CEO Lars linkforce keeps

referencing um worsening economic conditions in a new market reality for why things have gone so poorly but you know when you think about it like we have near record low unemployment we have pretty good Global growth um and uh you know it it calls into question what embracers prospects are if we like actually do enter a recession um which is why I think the company has kind of turned into like a value trap um they're still projecting like 10 billion kroner in uh earnings uh for the full year and when you look at it like on a valuation basis it's like six times their earnings um is the company's Enterprise Value so it's very very cheap on evaluation basis but um you know I I they just have 17 000 employees over 130 Studios and when you look at their revenue per head count it is significantly lower than like an EA or a

take two um and uh embracer just bought bought bought for the last few years in 2022 they spent um over a billion dollars making 20 acquisitions um before that um they spent over three billion in 2021 alone on a single acquisition as Modi um which is a board game company and like yes they wanted to create tangential properties to the board games um via gaming IP but now with projects being asked and canceled in studios like campfire cabal being closed um you know I don't think that's gonna happen like titles like um payday 3 Space Marine 2 Remnant two those are still going to be released but the ambition part of game development for embracer has been scaled back significantly and like it it just calls into question like all of this IP they have like um around all these game properties

um around like even Lord of the Rings um will they be able to successfully monetize it if they aren't willing to for the dollars into sales and marketing um and research and development I guess there's a little bit more um I mean given like all the you know restructuring Etc that's happening hopefully it kind of results in um you know being able to unlock those eventual marketing budgets for them so that they could reinvest um because I mean you know we uh like at the top of the show we also kind of um went through some of the announcements at Gamescom and yeah they do seem to be like a few games uh that you know uh that are definitely quite interesting getting some good early traction and can all be attributed back to uh Embrace her um but but yeah I mean yeah this two billion dollar deal yeah like you said it was really uh you know

a transformative could have been a transformative one for uh them uh two billion so so yeah pretty pretty big loss yeah I I think ultimately payday 3 is more critical to embracer than something like Starfield is um for Microsoft um and uh it's kind of weird that a company with 130 Studios and 17 000 employees has a lot writing on like just a handful of titles but that's just the reality of it like they've acquired Studios and head accounts but they've done little to actually acquire useful assets and um it's just all coming uh to Bear right now yep yeah I I I I I I guess that there's definitely like just something to say about you know you know principle in in um you know game seeing success you know like I mean the the thing about it being a hits driven business there's definitely like some truth to it um but yeah I think the way you put it

like you know in terms of uh acquiring useful assets that's a very different question than just acquiring a large number of assets yeah at zero percent interest rates yeah now very different let's hope for everyone's sake uh that that you know these games that they're riding on do well because obviously uh if that doesn't happen right not only does it hurt those games but it sounds like it might hurt like more the broader portfolio they have in terms of them being forced to look at those assets more hard like a trip oh we've got to cut these we've got to cut that down we can't you know like the number of risks they could take diminishes as some of those fail right and obviously payday 3 is like is a big gamble I think for that company as well just because like you know like they wrote like everything uh off of Payday 2 like they they had to pretty much cancel their projects so it's just it's a rough spot to be in with a lot of games writing on sequels now in general like a lot of the ones even you mentioned uh coming out of Gamescom and stuff a lot of sequels kind of being the the key to these games

where no one's really trying to launch a lot of new IP outside of maybe the Pinocchio one if you want to count that so uh it'll be interesting to see but we we did have an interesting changeover in leadership uh that I think is kind of interesting in relation which is a rose sansoff getting a new CEO uh yeah so last week or I think earlier this week um sandsoft uh announced a new CEO CEO sorry um Pascal bataya from uh formerly coming from social point so I thought it would be interesting to dive a little bit into what sansoft is doing um you know what their strategy is and you know what what their long-term vision is uh sansoft is kind of as a quick overview is another Saudi Arabia publisher making a big push to be a global player so we've talked already in the podcast aroused about Savvy games which is more of a holding company so there's like some differences between

how Savvy games and um sandsoft are even funded in in approaching game development but in general they're both kind of as part of this uh Saudi Arabia Vision 2030 that they call it whereas um you know there as a whole country they're dedicated to the country's socioeconomic make diversification and they really you know want to find kind of growth across all Industries and outside of oil um so Sansa specifically is not uh funded publicly they're funded by a saudi-based family which in some interviews the current CEO has called them fully supportive and thinking about the long-term uh vision of their Investments so we don't have you know precise figures on how much uh and how deep their pockets go but you know it's it's

a very kind of interesting case of just being you know privately funded they started as a publisher focused on bringing games from you know Western markets to Amino region specializing in localization culturalization marketing customer support but as of 2021 they brought in a new CEO uh David Fernandez he was formerly at king.com uh and with him joining they kind of gone to this more Global strategy which I think it's it's interesting because it's a very you know what they're executing is is interesting and it's um you know they're they're making some good bets but it feels like very billing bottoms up uh you know by starting with experimenting with first party games they have a studio in in Richard and they're trying to open a studio in the US it looks like

it's going to be Barcelona they were kind of shooting wherever they can find talent but based on um you know recent coo joining it seems like they've settled in Barcelona probably they want to open up in um Japan Korea or China and then open in the US like they want a big one big uh new region every year they've announced um that they're publishing or co-publishing with Jam City the the latest uh game that they've launched uh DC heroes and villains so that's focused on publishing it in the Mina region and they've done some small Investments around like the three million dollar Mark uh in some European um teams tiny digital Factory being the latest one so there's definitely they have kind of like these three pillars of global footprint publishing Investments um and you know they're all interesting on their own what really stood out to me

is you know they their vision is like in five years they want to be um you know basically the at the same size and level as as EA Activision tencent and Netties and you know the strategy that they're following doesn't quite line up with kind of that Grand Vision like it's kind of like a a mishmash of trying smart small to medium moves with a vision that's like an extra extra large um and it really contrasts with their you know the other team that I was talking about the the other company Savvy where you know they have a similar Vision in terms of of goals and you know they went in and bought scopely which you know puts them at kind of an advantage there and you know the men investments in tons of huge companies from like Nintendo to EA I think to a bunch of others so

um I thought it was like it's just like a very interesting uh case of of having like a very big big goal in in Target but you know what they're executing today you know it's it's not a five-year thing right it's it's it would be a much much longer time time Horizon um so uh I wanted to see if you guys had any takes or or thoughts on overall you know Sansa their strategy and you know their recent announcements yeah I I think like you know you have all of these publisher gun developers chasing mobile and I think it's pretty clear that um sandsoft is starting with mobile you know Gem City is only mobile um the new CEO comes from uh a mobile background as well at Social Point um but you know to your points I I don't know if they're kind of going about it in the right way like if they do have

this mission in five years to become like this huge player can you really only start with mobile assets like it seems like a much clearer transition like to go from console um and then either acquire your way or develop your way into like mobile capabilities um than the other way around just because it is such a different um user demographic well um well kind of like checking checking this company I would I kept getting reminded of Carrie first like the more I read about it I was more and more reminded of Carrie first and I mean just as a reminder to listeners but Kai first is um is uh is basically another mobile games publisher uh but focused on Africa and also you know seeing some good level of success they have gone on to raise like over 50 million or until like a series B and and such if I'm might be wrong on those numbers but yeah definitely raise like some significant amount but

carry first like super secret weapon I think is essentially their localized uh payment Trails platform I forget what the exact name is but for a region like Africa which first of all is double the population of mina um is I mean you know it things like credit card penetration and stuff is like super low over there yes a lot of people have like mobile phones and they are like mobile Savvy but in terms of like actual you know localized payment uh options um those they they exist but it's not like fully integrated in the infrastructure and Carrie first has kind of built out their publishing uh value ad with that in mind from day one um and therefore like there are lots of like parallels between guy first and India but I just don't see those parallels with sand soft Mina and you know uh and Guy first and Africa for example like

the more I read I just kept asking myself like what is the real value ad that sandsoft is kind of bringing to the table because um um I'm first of all like the region is like half the size of you know in Africa for uh two is in terms of car penetration and stuff the region is actually way ahead so you know uh like you know even if like they wanted to build out something similar like like Kai first there's the opportunity is quite limited because people are already kind of are able to pay um checking their current portfolio the kinds of games so I don't know they currently have like these super random casual games that they are kind of publishing in in Mina uh but the games that actually work in that region are all mid core like if you just look at you know the top 25 games of the past three years

almost all of them are mid-code the only ones that are not are you know Roblox but that's a phenomena and uh and the others are like some very very highly localized game Concepts you know similar to uh teen Patti in India which is basically India's version of Poker so you know like these kind of games are popular so so yeah but their current portfolio is really not even reflecting you know what the main region even likes in terms of games and and yeah I just kind of fully question like this whole you know they make a statement about we don't localize we culturalize and I was really questioning like okay is is there really that much upside in culturalization for this region specifically um even even it just take example of language diversity it's nowhere close to an Africa in terms of language diversity so you know it so yeah I don't know I I just kept

asking myself like what is the real value add that they're bringing to the table over here you know uh of course like they have like some understanding of the Mena region and such and you know they might be able to help developers I guess enter that market but um yeah from from reading and from hearing talk about it a little bit like I was just thinking that one of the big pieces that both with Sans left and even Savvy um what it feels like is that they're doing the Mina you know publishing localization culturalization etc etc more as a way to justify you know the Saudi Arabia vision of having the industry you know speak to their region but really were you know where the growth is and where they're gonna see success and you see it with like their their vision is like it's not you know

build this amazing community of of gaming developers and players in the region is you know compete with EA and Activision which then it what it says is like okay they're trying to use their their Deep Pockets to get into a global market it's more of getting into uh European Asian in North America markets both from the the development development standpoint but also the the consumer standpoint and they need to to be able to secure that money they need to have a push for also bringing the games to the Mina region also bringing the development uh some of the development funds to mina region so I think it's it's kind of a way to justify and this is just me from from reading for both stand soft and and Savvy and seeing you know the movement of their

strategy is it feels like it's um them just trying to justify okay we we have the Saudi Arabia money we need to you know please that like one priority but really where we're gonna find growth is not here like where we're actually going to be able to compete in a global stage is by going everywhere else yeah I mean I hope they like uh change the messaging on their website to that soon because it's uh you know like because right now like the Meena publisher for Carrie first and being an Africa publisher it just made way more sense to me because the revenue potential ceiling for that continent is much higher because they're way that entire content and the people of the continent are way earlier in their digitization Journey you know Mina doesn't feel like that um there might be like certain countries in the Meena region that are like that

especially maybe in in North Africa but but yeah it it just it the ceiling feels way lower and therefore you know Sands of being the Mina publisher yeah you know the value add was just not clear but but yeah I mean what I mean you also said make sense I guess we'll see like there's a lot of money flowing into the Mina region a lot of attempts to try and kind of grow that out and I have a feeling either like we'll see you know a few years from now like wow that was so prescient like you guys really blew up that region like that was a great investment or it's like well that was a nice try like everyone kind of wanted to get a piece of that potential pie but it just it didn't really work out because that region didn't have the the growth potential we thought it did but we had the money at the time kind of story it seems like uh obviously like hard to say it right because uh you know you said there's there are some ceilings to that growth

but there also is like potential to an extent but it's not like a us trying to get into the Chinese market kind of potential I I think so we'll see hopefully there was some money well spent regardless uh because there seems to be a lot of it going on uh you know whether it be in Esports or games development in general things like that so hopefully a lot good comes out of it but we'll see probably not for another year or two at least I would imagine before like you start to see that that working on or not but uh I want to thank everyone for you know joining joining today like some great topics we have a lot of stuff to cover and like it's only limited time to do it so definitely like trying to you know squeeze in some more good stuff next week as well so thank you listener of course for tuning in every week here which you hopefully do uh and we'll see you all next week if you enjoyed today's episode whether on YouTube or your favorite podcast app make sure to like subscribe comment or give a five star review and if you want to reach out or provide feedback shoot us a note at podcast navic dot Co or

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