Superstar Session: A few words from Angry Birds developer Rovio

[Music] [Music] crank up the volume so thank you for having me and manin some news and we we are as these things go when when you go through a process like this it's quite regulate that it's all very new it's all very exciting and as I said it's quite regulated and it's very guarded what we can say and what we can't say during this period of time and and you could even label it as a bit of a silent period so as a result I can't actually

say anything for the next 15 minutes and I'm only going to stand here [Music] now that's not completely true I'm gonna start by stating I love this industry this is an amazing industry to work in I've spent the last third over 13 years in mobile games which was a bizarre choice at the time to start working at the mobile games but slowly but surely my friends and family came came around to say but this is a great industry to be in there's a few reasons why I'm gonna I'm gonna state here some of the most obvious ones mobile gaming is now the biggest form of gaming entertainment this happened last year so not a small feat this is an industry that was born this year 20 years ago here in Finland last year mobile gaming

took the helm as the biggest form of nth mode of gaming entertainment by measured by consumers spending consumers voting with their wallets for mobile games in fact mobile gaming is that is the fastest growing form of entertainment overall I let that sink in for a minute TV well I don't know if anybody watches TV anymore but TV a box office etc everything is dwarfed by the growth of mobile games analysts were predicting a 14% growth rate until 2020 that's all fine but it looks as though the industry is actually growing far faster than a meagre 14% kegger why so well iOS and an Android mobile gaming revenues grew q1 year-over-year over 50% and a penny which I'm sure you all you all stare at that penny figures from time to time a penny recently said that they believed

that the mobile gaming end user generated revenues are going to be at 105 billion in 2020 sorry 2021 now if this is the case then the industry actually needs to grow far faster than a again meagre 14% and I say meager lightly because that's a really fast growth rate and in all all grant game of things there's a few reasons why there's this year 2.6 billion smartphones in the hands of consumers worldwide hopefully in the hands and not in the pockets playing Rovio games the conversion from smartphone user to smartphone gamer is still increasing where I think 72% in the US this year growing to 77 percent over the next few years even in a mature market players are spending more and more on our crafts they're voting with their wallets mobile games has become a culturally accepted form of entertainment and lastly the free-to-play model itself extends the

game life cycles in the u.s. if you look at top grossing lists in the US the top grossing games are an average over three years young or old however you wanted to label it but there are a lot of games that are originated from 2012 in the u.s. top grossing lists so the life cycle has been completely shaped differently than what was once in premium games all in all a great industry a few words about about the business model free-to-play in here two of our own examples I don't probably need to sell you on the fact that when free-to-play works well you can increase your business over time but it's very striking when you look at a 2 of 2 of Rovio's own examples Angry Bird space who remembers where Angry Bird space was launched from Icarus you should notice it was from a space station so some

sometimes these things happen and to my knowledge is the only video game in history ever launched from a space station quite the meteoric launch I thought that was tumbleweed the now having such a great launch it still falls over time that's just how how premium games work whereas free-to-play when it works well it looks a bit like Angry Birds - a game that we well initially we with tumble stumbled a little bit with that game but we managed to turn around over time and we've we've surpassed our initial revenue spike and we still believe we have our best days ahead of us this is this is really beautiful this makes sense and from a financial point of view this is also something that that is way more predictable and stable then premium ever was so in here in our wonderful business you have the art you have the data and you have the business all wrapped into one that's free to play and

it's wonderful I love it I also love Rovio it's funny to say that on stage but I love Rovio and there's a few reasons why I believe in our mission we're here to set the world on fire by crafting the best games and entertainment in the world who knows what Rovio means who knows what ovum is Rovio means bonfire so there's there's a there's a direct correlation there with with with with what with what we aim to do we also want to conquer the top grossing charts for years and we want to grow Angry Birds and perhaps in the future also some other bird but brands too evergreen entertainment brands this is this is our mission and our vision and to underline underline this there's a short video that I wanted to show you show you today of some of the things that we've we've done over the past few years with Angry Birds and and with Ravi and I think the especially I think the

mission statement kind of comes to light by by by looking through this this short video let's go oh it starts by the very first animated trailer for Angry Birds which we spent let this sink in for a minute $25,000 on what so here we go Angry Birds more like angry stands what's your name hot rep here's my favorite computer game Angry Birds fan fiction I'm calling heads up Angry Birds remember Angry Birds none of us have any memories at all from the year 2009 were leveled up it was complete Angry Birds play Angry Birds like else

was the word angry birds' friends [Music]

[Music] [Music] [Music] [Music] [Applause]

aren't they cute now if that's not reason enough for me to love the company I work for there's more we are now what we label is a game's first entertainment company now there's the the these are done on date the heaviest lives you should seize you should see the date the heavy slides the the games business accounts for for about 80% of revenue over the last 12 months brand licensing about 21% we had over the past year we had five games in the u.s. top 100 grossing charts on iPhone in fact last week we had four games in the in in the top 100 grossing charts in the US they were all bird games so I guess my tip of the day if you want to succeed in mobile games stick a bird in it not the official the what what what actually is is is is

interesting here is that in our games audience composition air in our audience focus we we have a few different audience profiles we target our games development to and when we look at who's playing our games even the games we had in top top 100 grossing last week even though they're yes they're Angry Birds games but they're played by in a very simplistic nutshell adult females and adult males there's way more interesting data than Jeanette and gender and an age but in a simplistic way to summarize it that's who's playing them so we can address both genders all ages with the Angry Birds four quadrant brand which is quite amazing we're bigger than and stronger than ever at this point in time our games business is grown through the years and we're growing faster at this moment in time than we've we've ever done the reason behind that fast growth at this moment is last year in 2016 we got our free-to-play kpi's to a level

where we could actually start investing at scale in user acquisition we invested last year about 20 million euros in in you a and this year it's growing tremendously over the past 12 months we've invested forty five and it's it's it's skyrocketing as a result of of LTV is rising daymo are our head of finance in the games division is gonna speak a little bit about the song and dance and holy matrimony between finance and user acquisition it's gonna be an interesting session so we transitioned our business from from premium to free-to-play 100% of games is now games revenue is coming from free games the brand licensing business works very well we've pivoted the movie business to a licensing model so we're now we're now not funding the the upcoming movie but we are working in in good partnership with our our partner Sony Pictures Columbia TriStar on on that movie Angry Birds this is a global big brand

in fact 97% of the world knows the brand which is which is very unique this is the number one global brand born from mobile games it is also the first mobile game to reach over a billion downloads and we have as you can see we have a huge brand awareness and something that was was happened in a tremendously short period of time it quickly became an a franchise that virtually everyone in the world knows we have a strong live portfolio and we also have a very clear strategy for future game development our top 5 games again this is the non date the heaviest might that are our top 5 games represented about 80% of our revenues over the past twelve months we have 20 games live but it's really thought we focus on it's the top of the top of the top that we run live operations on and we acquire choir use users through performance marketing means and those are the games that grow

over time we focus on the here and now in terms of our in terms in terms of our strategy however both majority of our game development team is actually working on new games there's 13 games in development at this moment of which only the very best the best will ever reach global launch five Studios each studio owns a specific genre of games each studio has a domain in which they operate why so we believe that the only way to perfect your art is to do it over time and really focus on what you do and we've chosen each domain each genre specifically based on market development based and based on our own strengths naturally we're strong in slingshots games interesting this is like this this is a top grossing genre now and we are we're strong I can't claim ownership of Swing slingshot games

but I just don't know where very many others wings of games than ours we've grown very strong in matched puzzle games we have a few of those on the market latest game Angry Birds match was won't launched about three weeks ago you should all download it battle game's battle Bay came out in May that's the first endeavor in this space real-time PvP seems to all of a sudden be the thing and we happen to have a game in development that went out just when it is a thing now we have also tuned to new games yeah developing their RPGs are worked on in Stockholm massively multiplayer online mobile games non Angry Birds games in our London studio which were ramping up and started this year so in a nutshell we have in terms of the crafts we have a lot of interesting things going on and I think that there's positions pretty much in all studios and here it's a little bit of a plug if you're interested let us know there's certainly a lot of very nice things to do at Rovio furthermore our games the

service model how we operate it works it creates eventually digital hobbies out of our games and here we're showing a b2 together with the da Yu development so we really managed to scale up the business while maintaining a fairly stable da you hopefully if if GDC approves there's going to be a very deep dive into how we actually did this and and in the springs in this coming Springs GBC so Chris can you help sure we should do it here our free to play expertise is paying off we have a growing number of paying fans paying customers our our monthly average revenue per paying user has increased quite tremendously over the past few years on average across the portfolio users pay over 30 euros per person or paying users pay paying customers pay

over 30 euros per person and as a result our in-app revenue is growing growing quite nicely and and this is really off the back of user acquisition and focused on the here and now and improving KPIs on top of that which are not showing on the slide we naturally also run ads in our bit in our games that's about 15% the top line between 2 and 3 million euros a month right oh yeah well this is only here because it looks like a hockey stick and I love hockey sticks but this is the games business quarter by quarter growth as you can see that the red bars they represent the top five so it's really the top five that is growing over time and that's really where the strategy is the current games whereas whenever we release a new game it's tremendously important for us alright so the million dollar question what have we learned so far from this

process we're in and potentially then becoming a listed company in the future so number one suits both in our corridors and in our closets that was a surprising learning look at me I did what is this and secondly slides have become a format they're friendly printer format now our stage jokes are scripted to the finest detail insert laughter here and lastly everything is night what we really have learned and what we what we really want to underline is is that this is a process is something we go through and hopefully the results in a positive outcome however we have our own culture we are we're Rovio and we will remain

Rovio despite the process we go through we will remain an internally very transparent organization we've done really I think really good choices in terms of how how we approach data moving forward and and learning from each other has always has always been very important for for game development and very important for Rovio and that will remain a very very important aspect of our company moving forward so with that thank you and feel free to get in contact [Music] [Music]