TWIG #282 Is Netflix Games in trouble? Xbox PR stumble 🤕

[Music] hello and welcome to this week in games 282 where we read and distill all the weekly game industry news so you don't have to all right here's what we're going to cover today we actually have a ton of stuff so this is just scratching the surface Google IO updates Mishka is obsessed with web 3 Investments yet again so we're going hear about that Squad Busters passes 40 million prees but someone else is gunning for them uh Netflix's virtual theme park opens in Roblox and triggers the [ __ ] out of Crest and Xbox president Sarah Bond's interview with no news news um so all of that is coming up so I am Jen donaho strategic marketing consultant at beta hat and Jaden Inferno and today we have on our illustrious twig panel Philip black game Economist at gam economist Consulting hey hey Eric Crest principal

at Goomer Consulting Group what's happening folks founder of deconstructor of fun King of the supper clubs yeah Mishka katov is back I I want to say the theovon thing that we were just talking about before that but I will not because we will not beep it so hello everybody yes please no let's let's we have enough cursing and inappropriate things on this pod this be highly inappropriate all right uh Phil I think you want to go first you love Eurovision so what happened it's a part of my citizenship um what did real F call this for Americans he call this like cir disle meets the Olympics meets like the UN or something meets American Idol okay congrats to Switzerland they took it home this year and of course Sweden top 10 finish again they're so successful that we have an affirmative action program for Norwegians we actually had two Norwegian twins enter

for us and compete which is a little heads scratching but um yeah go our continent what the [ __ ] are we talking about euro vision it's it's it's a big Euro the American mind wouldn't understand it's American it's American Idol for meets the Olympics of of Europe and pride it meets Pride it's like the biggest oh it's like American Idol okay so it needs Pride because it's more than that a non-binary person became the first winner it's another just copy the United States with their popular media just copy and paste right because you can't come up with anything on your own that's exact forever American Idol is Dutch M Dutch I think it's Old Europe trying to like copy America again I like how Chris had no idea what this is and he's like They're copying us because because it's it's a non event because American Idol created this [ __ ] dude you guys are just copying it

incorrect this this is so incorrect it's anyways we're moving on because I did not anticipate that the biggest controvery on our podcast would be euro vision I thought it was going to be Mishka getting your opinion about what Ethan likes to play games with and scantily clad anime women we've missed you the last few weeks I listened every minute well the first take is is I'm 30 almost 39y old man I don't watch cartoons so no I don't care about that but but all overall like anime has been disturbing to me since 2013 that's when we went to Japan to uh to prepare for the launch of Clash of Clans and I vividly remember us sitting in in a in a creative agency local creative agency they were like okay guys we got they didn't speak that way this is how I'm hearing I'm hearing everything in like an American accent they said we got you we have perfect localized marketing campaigns and they brought these images of what would consider 12-year-old girls

with double D's and I was just looking at the market I'm like this is disturbing naturally we did not do that so I was against this type of visuals back then and I remain of the same point in like 11 years later so Ethan and M are all oh this is mainstream look at Nick you know whatever dude that thing did like less than two million downloads right that's not mainstream guys that is like super Petty type folks that want to see little girls with big boobs it's [ __ ] gross well anime has been expanding like what I've been seeing like just from the side it it has been definitely expanding it's less disturbing violent for sure but but not like you know over sexualized so I would say I would say they are they're right in in in in many sense that that it's being becoming more accepted in the west with with the uh the problem is that it may evolve and and broaden its appeal but then it's not even anime anymore right it's something different and

something new so Western anime they call ConEd on that but the fundamentals of this thing are just gross All Right Moving On Moving on just like anything there are extremes um what's not extreme is that games beat is happening in La next week May 20th to 21st uh there's a very cool woman in games breakfast on May 21st that morning I've gone the last few years this event is always amazing the network is amazing so hopefully everyone can show up it's supports Venture beat and games beat in din Takahashi which we don't do enough to support our game press I don't think we are actually game press we're just a bunch of yahoos from the game industry who get on a podcast and try to pretend like we're press let's support the actual press there how many of us find out about the industry all right Mishka what else have you got going on uh Shilling on my part so I wrote a piece finally I I've noticed that I haven't been even writing so much CU we have so many people writing great contributions

on on the blog but I wrote a piece called the three game industry Trends to watch in 2024 so in short the trends are right sizing Gamers play less time and fewer games as well as AI will unlock productivity and lead to further job losses if you're interested in this go take a look what are the three Trends in my opinion very much looking forward to hear the comments and this is based on the conversation that I had with new's head of Consulting Ben Porter who came on a podcast so this is kind of like my takeaway but I suggest to everybody who listen to that podcast because you'll get it right from the horse's mouth and then you draw your own conclusion these are just my own conclusion then the Shilling part we had a supper club last week I'm an easily impressed person and this this whole idea came from light speeds morit and Goldman's himal I'm going to just drop a couple of those names I'm not I'm not name dropping I'm just naming them to give them credit and they they invited me to this dinner and it had this really cool concept where people didn't talk about the industry or

the games per se but they talked more about personal stuff and I was like hey let's let's give it a go so we had a first supp Club here in Helsinki a lot of the companies that we talked good about and more critical came on so it's was more like Studio directors and GMS and M MDS and so forth like just a friendly dinner like you're you're souping up like it's something special you just you just out and just didn't talk about work so so I'll give an example now that we're using Stockholm and an example so there was a VC dinner over there play Adventures arranged that but they were nevertheless like the studio heads of the top Studios right there so the the head of Studio of Arrowhead hadn't really met the studio head of another Studio let's say dice I don't know other the ones and and this kind of atmosphere kind of brought them together of course they've heard about each other they they kind of know how each other looks but they never really spend time and the whole idea of a supper club is kind of bringing people together from different Studios to really connect that's it nothing more so we're trying to do them I got many requests after posting that photo on LinkedIn where people were asking to uh to support this in their own City so you

name a city everybody wants to have a supper club there so we'll take this on the road uh I'm hoping that uh Chris Phil and eug Jen will host some and of course Laura out of out of Seattle that we can host more of these supper clubs they're fun they're great way to connect nobody talks about idfa nobody talks about all that the Jazz people just talk about themselves and and their lives so supper clubs that's on the menu nice okay you know it's amazing what you have time for there Mish you haven't publish forever you haven't been on the podcast for months and then oh you could do this [ __ ] dinner this [ __ ] like one more shell now that you said you haven't been in podcast so a couple weeks ago I was in Paris to record a podcast uh with W of course he's in Paris of course he's in Paris it's listen it's like you flying to San Diego it's not that far anyways we did the most uh high production value podcast that we've ever done before there was two camera guys and a lady that that cut in between and we were our noses were powdered and between convers like we

need to take a break to powder your nose so let's see how that comes out trying something new if that's a concept that works we'll do more of these high quality ones if it doesn't we gave it a go so that's coming out a beautiful podcast out of Paris Peak Performance it is all right moving on to Corrections actually it's a little bit more of a clarification so last week we were talking about steam's Advanced access versus Early Access so because I hadn't had a chance to really dig in and understand what we were talking about let me just give a little bit of clarity so Early Access is what is a beta testing tool so this is getting access to a game you know well before it is released Advanced access gives players two to four days for players to play a game ahead of full release so there is a little bit of a difference in timing on this this is EA's old program remember they used to run this with some of their their premium games like Anthem had this where if you got a deluxe edition you could play the game for seven days ahead of time this is essentially steam giving

that a brand cuz EA never had a brand for that nothing to really rally around and like have a clear consistent player benefit for this feature and it's an amazing feature because it literally costs nothing it cost it cost nothing just to say seven days so so the question is like okay why not 14 days why not 30 days uh I think there's some some interesting questions to optimize there yeah and for my understanding that was the only really value prop of owning the subscription for EA was getting early access to the game and getting a head start against everyone else else as well as some discounts on currency and stuff but that was the primary thing it was like a frequent fly mile thing and it was relatively successful for the core Gamers that but it didn't bring any new people in it was for existing Gamers if I remember correctly too like Call of Duty used to let you play certain Maps ahead of every everyone else if you it was a way to really sell the deluxe editions and get pre-orders in and things like that and so instead of it being Early Access what it was called Advanced access on Steam is how I

understand it all right nothing about hell divers do we want to say anything about hell divers no no more nothing about hell divers did really well yeah it actually did I think I read that it is Sony's fastest to 12 million unit seller like something like that like it is just crushing it in the numbers first CU Sony had their earnings report which we'll get into a second they actually had some changes at the all right da is still declining that that I want to mention like sales like a lot of the reports when when you get media reports of Premium games a lot of the times they quote sales which is a running sum it's cumulative sum but when you look at the Active user base on Steam numbers it is still declining the story for hell divers is is not yet closed I would say it hasn't cemented its position yet it needs a little bit more time of stability to be able to prove that it's going to be a regular top 20 steam contender in my opinion yeah I mean where's pal world right yeah I mean yeah yeah I think this has more

legs though this this has more legs this is serious I'm just saying like that was a soup dour for sales for a while um both discounted products well but isn't the big difference how Hell divers has really innovated on life service I mean to me Po world wasn't it you know it was a very small studio and they were they didn't really plan on life service for that game but hell divers is really driving everything with how it's approaching life service and in the co-op of like your identity is you are in this Army and you are actually you have to show up to support everybody for community-based goals or else you know you're not going to unlock the next major thing in the game we haven't talked enough about hell diverse we we should do we should do a special segment yeah a deep Dove on it I think it's it's a product that's worth discussing and and we should do more of it we haven't done a ton on the podcast yeah fair enough okay a lot to go in my market segment or kind of the high level segment so Google IO I put a link in the deconstructor fund slack Channel there

were a lot of announcements for Google Play and what's going on with mobile so here's just kind of a a couple of them I'm not going to go deep so they announced a new discovery feature for apps new ways to acquire users updates to play points and other enhancements for developer facing tools like Google Play SDK console and play Integrity API Google play games on PC extends to 140 countries custom store listings based on what players search for deep link patching without having to update the app and more so TechCrunch has a great summary there's a Android blog post that covers everything oh oh also I did want to mention this you know CR we've talked about UPI and payments in India the Play Store Commerce team now includes support for UPI in India and pix in Brazil the ability for parents to approve purchases for kids within a Google family setup I

think this exists in Apple today I remember doing this for our kids and in India the ability to ask a family member or a friend outside of your family group to purchase an app or an inapp product the latter is handled by sharing a payment link through a text or an email so lots of you know really good payment features that might see some increases in countries that we often call mice nuts right Chris well still mice nuts but yeah okay app and revenue increased by 48% year over year to 1.06 billion in q124 as the company continues to see significant growth in its ad business by the way I think the ads business was up 90% so just to be clear no and you're right I took that part out because I was like I felt like I was going too long on this but it's all driven by ads and the game side of the business was not growing that much however that's where they get all their data if they didn't have the game side

of the business they wouldn't get the data to fuel the ad side so we have to remember that they are interconnected and that allows them to be successful so app Loven CEO Adam frogi the super gangster said that one of his goals for the future of growth was to extend its services outside of games he later noted however that the company is still has no interest in brand advertising and instead focusing on performance-based Advertising quote there is nothing that limits our models to just gaming he said by expanding into web-based marketing and e-commerce we expect our AI models to improve with added demand diversity so chis oh my God your prediction of fingerprinting killing them is not happening because of AI I I have to believe the predicted modeling of AI on the back end and what I just mentioned the fact that they're using the data of their G Publishers is driving their

success okay where am I wrong no no no okay I will admit that I was wrong 100% wrong on Apple oven's demise but that was not because well partially because of their technology but primarily because Apple's kind of pulled back on going after IP tracking or fingerprinting or whatever but luckily I changed my view not early enough but enough to make people's money like basically it was long app and short Unity last year right that was kind of the call and that has worked up to today it's like it's a crazy trade like if you had done it you would have been I think I can't even remember know where the percentage is high but uh Apple haven't just destroyed unity and everyone else in the ecosystem I mean Facebook obviously is doing really well and Google and so if Apple's pulling back because they can't really go after fingerprinting anymore because they they don't have the runway anymore their business is kind of [ __ ] right now and they don't want to upset and and mess up the overall ecosystem not much less even gaming but everyone else they're not

going to do it so it looks like Apple's in the driver's seat for the foreseeable future until if it when Unity gets their [ __ ] together Adam's a gangster dude yeah like the guy just he bet on the right horse he went after this like 100% they owning this this uh Performance Marketing segment truly when you look at the top providers of UA apping is in the top three if not the top person the top company for most of the tier one countries on both platforms well all I'm seeing is like them taking like 70% of all UA for for example puzzle companies it's insane what what what's happening and how how good of that channel is and and how weak some of the channels have gotten during the same amount of time my question more is like would would Adam since he's such a gangster would he buy now Unity oh like just for the [ __ ] of it why I mean just because they pissed him off like a few years ago I mean they would just shut it

down right I mean they would shut the um essentially the iron Source part or just consolidate the clients and everything yeah and and just clean it up and and have that and the second part was um I'm not sure if this is true or I'm quite sure this is true but what I'm hearing is Apple I think they announced this a long time ago that they wanted to sell the games portfolio and to my understanding they're still trying to sell this right Am I Wrong Am I just imagin things I don't know but to my earlier point I don't know how you do that because that's the only way that you get an A sense first-party data that's how they're training their systems is their their internal studio and that might be one thing when you think about unity and you have access to the engine and you have access I mean that's the only thing that's kind of helping level play right now no okay okay I want to make I made this point on the podcast years ago and I want to make this point again Publishers do not allow Unity to track their [ __ ] player

Behavior because they're using the engine that just doesn't [ __ ] happen right it was such a misinformation around John rotello back in the day and selling that idea that's just not the way it works sure some people opt into that maybe right on the low end but there's not people that are not going to share their [ __ ] user data because they have the engine this is ridiculous it's a ridiculous assumption and it's been debunked like recently like the last couple like last six months too this is [ __ ] maybe it's not the engine but there are things that are being shared I mean that's what's going on at Apple it's not engine based but it's something else I want to make a prediction this is just a wild one I want to just say this app Loven sells their game portfolio and acquires Unity okay that way they're out of games and they're purely in Tech out of content and purely in Tech okay that's it well there you go good job there you go all right moving on I could talk about this for a while I just moving on there were a couple of uh research reports out around teens or J or gen Alpha in gaming so I

posted a link in the deconstructor of fund slack with a couple of takeaways some that I found that were interesting 85% of us teens say they play video games and about 4 and 10 do so daily 40% identify as a gamer can you imagine Chris back in the day when it was like Jes you were a jock you were a goth you were a a cool kid if you identified as a gamer back then we would have been like taken out back and gotten our asses kicked that's right it's like it's like identifying as an anime fan today good call back well done I like that that's the quote of the the show so far well maybe this leads into teens see both positive and negative side effects to video games uh from problem solving and then they actually make friends I saw my kids actually make a lot of friends on the negative side to harassment and sleep loss I also saw that the kids sneaking their iPads in and playing this is not meant to be a Flex at all my son has literally dated

three girls that he met playing video games including fortnite right like it is the Social Hub of this next Generation it is weird my wife cannot get over that you know like but I get it I get it but it's crazy it is no I agree with you I saw the same thing with my kids all right so a couple of mini segments trans media of the week because you know we love talking about this and and by the way it's happening all the time where we're seeing video game property show up as TV media and by TV could be streaming or movies so there's a new Angry Birds animated series coming to Amazon Prime on May 21st Tomb Raider another Tomb Raider is coming to Amazon Prime after Fallout success you can imagine Amazon's like hey everybody doors open if you got a video game IP bring it and then freef fire Japanese anime spins off from spin-off coming from Gina so uh a lot coming there so cool collaborations of the week because it's fun to talk about this

stuff I really think that there is like this is the new marketing strategy is okay who can I collaborate with each quarter so that I can bring in a different kind of audience and it's kind of built in UA uh leveraging both Brands OverWatch and Porsche Launches on May 15th uh there's like a a Porsche inspired Mech for uh Diva one of the the heroes Man City footballer and eafc coverstar Holland is now in Clash of Clans so there's a great creative spot that was like live action combined with that amazing 3D that they do on Clash of Clans this is what supercell has always been known for in the marketing circles I can only imagine that that was like a $3 million plus just for the actual creative not necessarily for the sponsorship I mean we might be looking at a$3 to5 million collaboration that's going on this is expensive stuff and then the most triggering collaboration

of the week and we're going to get into this a little bit later is Netflix and Roblox team up for next world uh virtual theme park if you want to hear a a famous Crest rant hang on for a few more minutes this podcast is brought to you by heroic Labs you've heard of heroic Labs by now and we keep talking about them because in today's mature Market you need every Edge to be successful rather than spending those precious company dollars on building game Tech focus on building your game and shipping it get it into your player's hands faster and grow your community heroic Labs is a battle tested partner and friend of the podcast their Tech enables you to be flexible creative and scale for Success heroic Labs has your text app covered whether you're looking for a world class backend server and amazing game development framework fantastic liveops tooling or reliable Mass scalability heroic Labs has solutions

for all of these challenges it's not just us at deconstructor of fund praising heroic Labs the company works with some of the world's biggest Publishers on the most beloved games focus on your game save a lot of money and avoid Tech risks with heroic labs this podcast is brought to you by sensor Tower sensor tower has acquired mobile analytics company DayDay AI formerly known as we all know and love app Annie four things you should know significant advancement number one this acquisition represents a major step forward for sensor Tower it expands its customer base mobile marketing and app intelligence products and Global presence number two Undisputed leadership position sensor Tower strengthened its position as the leader in digital marketing and mobile app intelligence through this acquisition number three combined insights this merger with data AI allows sensor Tower

to offer customers even stronger and more detailed insights on the Digital customer journey and last consumer Trends with increasing time spent on digital channels the combined company is well positioned to capitalize on the growing trend of inapp purchases driven by platforms like Google meta Tik Tok YouTube Instagram and snap exciting times lie ahead for sensor Tower and data AI as a join forces if you're a customer reach out to your account director for more information not a customer yet no problem schedule a call to explore the Innovative digital marketing products they offer go to data AI or sensor to.com and get on board with undeniably the best data partner in the business Investments Investments and m&a so number one ugc and modding tool developer overwolf has acquired us based attech company Nitro pay Nitro pay

provides attech Solutions specializing in ad placement Revenue management and detail analytics for websites so fun fact overwolf the modding platform has raised 100 almost $150 million across four funding rounds the CEO and co-founder was actually on the podcast in back in April 2022 so you want to listen to that just Google deconstructor fund and URI Marchant URI anyways you you'll find it if you're interesting and the full analysis of this deal was actually on invest games website so I just really suggest everybody to get their newsletter all the deals once a week you'll get them if not from here then at least from invest game second deal ireland-based games tech company Altera has raised 9 million in seed fund round LED by Patron uh and first Spark Ventures with participation from a16 Z's speedrun and other Angel Investors that company focus on AI development and has already created an AI agent inside Minecraft which simulates the behavior of real players I think I saw this at a

dinner party somebody was showing me if this is the person that had a lot of tattoos on fingers and everything then I've seen this cuz he was talking oh anyways this it was an interesting story but I think I've seen this it's a it's an AI play anyways third deal Ireland based games tech company yellow has raised 5 million in seed fund round from a16z the funds will support the development of the company's AI powerered 3D character modeling tools so another Ireland investment another AI thing and then third investment to Ireland I don't know what happened in Ireland like I've never even heard that somebody's getting investment in Ireland anyways ireland-based game tech company jamango has raised 2.5 million in precede funding the funding will be used to develop company's no code platform for further browser game development so VC's are really putting Ireland back on the map my Conor McGregor here very interesting and then as with every m&a news we have to finish up with web 3 us-based web 3 game developer void laps has raised an undisclosed amount of funding from the usual suspect you can

expect Deli yield Guild games etc etc the funds will be used to develop a studi title blade of God x a dark themed AAA action game available across mobile and PC so I I'll have a little bit of a monologue about bet 3 but I can't wait to get the nfds for blade of God X and play it on all the platforms oh Crush save us please talk about other stuff layoffs employment closures uh Unity Chief product officer and Technology officer Mark Whitten will resign June 1 he was in charge of the engine business as far as I understand it likely as a result of Bromberg coming in maybe he felt slided that he was not put up in charge of I don't know uh Sony leadership changes H I can't damn it I should have [ __ ] practiced this one some didn't watch will be appointed the CEO of the

platform business and Herman Hol will be appointed CEO of the studio business and heroki too to I knew I was gonna [ __ ] this up anyway so fundamentally it looks like the Japanese are taking over right that's all that matters right this is exactly what we expected like after the Americans have run this place for years and years and years the Japanese are taking over the studio head Hol is interesting choice but not really that surprising plka eliminates the cro and Co positions in new job Cuts I would love to hear some dirt on this I met both of these guys I think at GDC a couple years ago these two have been together at this company for 12 [ __ ] years like they were just like freaking Frack right so like I don't know it really seems strange to eliminate these roles but I'm actually getting a little bit more interested in playtika moving forward but that's a whole other conversation Square Enix lays off workers in Europe and American Division this is the I hate when people companies do this where they announce that they're planning layoffs without any so then it keeps

people all limbo and [ __ ] freaked out about their job basically in law law yeah with law we have to inform uh in Finland it is six week in advance you have to inform that we will be reducing possibly and then you have to start negotiation with your with your Workforce it's for companies that are over like 20 people or something so this is by law that you have to inform before you lay off and you cannot make any decisions of anybody being laid off for those six weeks it has to be negotiated with the representative of employees welcome to socialism oh my God okay no wonder okay now I'm I'm taking it taking it back um anyway so what happened was is they they they're planning on rebuilding its overseas business division from the ground up quote unquote structural reforms to optimize costs in Europe and American offices and they're just basically implementing these changes because a really disappointing year of games that failed to live to expectations of course the G one of the main games that failed to live up

expectations was Final Fantasy rebirth part two which uh is certainly not a western game so we should hear more about that going forward any idea why rebirth didn't work isn't Final Fantasy not enough anime I actually talked to a couple people about this is generally when you do a remaster or Rebirth of something the first one's going to do extremely well but the second one is going to be like right like either you loved it you hated it you tried it but some people are just not going to come back for the second right that type of thing you know so it's like it's kind of like sequels of of new type of games it's really hard to execute against the second sequel it wasn't like the quality was bad right um I think they also did they did like the Hobbit thing where they [ __ ] drag this thing out you know like for three like they didn't need to do that they should have just made it one and two maybe um so anyway I don't know got it

got it okay Phil what other games are in the news well there's a new husbando this is a term I was not familiar with this is the female equivalent of being into games like Nikki goddess of Victory it is about you know collecting a squad of men that are of the anime art style um and then you play match games and it's actually got a very interesting match mechanic it has this wave that comes across the board so you set up the matches and then they're triggered when the wave comes across but it's all centered around this husband theme so I just just to just to put it in there like it cuts both ways Cuts both ways I'm looking at the game it's not it's not as bad it's it's uh it's quite mild like I was imagining something absolutely different when you said this I mean 12-year-old boys with whale siiz penises no what the [ __ ] no I was I was like Chip and Dales on like all is that whated yeah I would be like that must be

it and I saw this and then they look kind of like like vampires kind of like uh what's the vamp like what's the uh was the this tlight famous Twilight they look like Twilight characters boring it's like oh not chip and dals I'm out well I mean so you guys don't understand that women don't necessarily want exactly opposite of men what men like in anime it's not like we want all of the visual they they want too hot to handle too hot to handle all right can we move the [ __ ] on no more talking about anime it's over it's over let's go uh Squad Busters this is this is almost breaking news Squad Busters reached 40 million and pre-registrations that's their target they've already hit their targets registration is accelerating there's only 5 days to the game's launch I looked up where this stands in the record book and this is actually the second most or Zone has the first at 50 million Call of Duty mobile had 25

million and I actually think there's a game that will launch later on for mihoyo called zenist Zone zero this is their next action RPG and it's already in pre-registration with two months to go and last time I checked it had 30 million pre-registration so I think zenist Zone zero will probably end up besting Squad Busters but it looks like Squad Busters is going to set the new record and will pass War zon's 50 million this this reminds me of like those pre-order numbers if you remember way back in the day everyone used to like go Gaga over what the pre-order number was order was like what is old as new again cting construction out soon right Micha we're going to we're going to be talking yeah yeah yeah we're working on we have a text coming out from another person that we're working on on a podcast I've been playing every single day when after this came out I [ __ ] love this game by the way pubg crafton's pubg had I think 50 million pre registration anyway like my brain it wasn't an exensive study so what what's what's interesting about the uh what with Squad Busters like everybody's giving ton of kudos to supercell about their turnaround like the uh The Clash

of Clans campaign with with uh with Holland amazing the Godzilla stuff with brawl Stars overall the the growth of brawl star phenomenal the squad buster game coming out Global finally after five years Hiatus of of not launching a game great you know everything is is perfect the people at supercell and and the leadership is is of course due to all the other praise but nobody is saying anything about tensent and you have to imagine the 10cent the biggest game company that supports all of their studios in in various different ways I'm sure that they had their hand on in a lot of these things in the way they run marketing develop their art Marketing in the way the supercell is running their live operation especially on that front so I I just think that we should also give a little bit of a kudos to 10 cent for what they've done no no like like majority owner has nothing like no kudos to 10 cent at all let me let me go here so I I don't know supercell's relationship

with tensent but at Riot because tensent own Riot they were completely hands off with most of what happened in Riot obviously they publish League of Legends in China and they were you know absolutely involved there so um while they are lovely and they have a lot of resources and they do a lot a lot of things great one of the key benefits of being a company that is owned by tenset or a majority owned is that they are hands-off so I think you actually need to give a ton of credit to the supercell team themselves for for doing oh no so is going to disagree nope nope nope nope that's not what happened though that's not what happened they were not they were hands off for a long time and and he managed this thing into the ground right so on a relative basis the revenues were down for like five years in a row right and so I tenset did come in and from my understanding I actually talk people specifically about this they came in and said hey you got to pull this [ __ ] together right and and make make changes to make these things more

like live services with you know stap up the live up stap up the yes I wouldn't give supercell 100% credit I mean I think it was 10 said putting a lot of pressure on them to get their [ __ ] together and we talked about this because we've been following brawl star's comeback is how they decided to go after life service and actually invest in teams again I actually want to give some credit to these collaborations because so I've been chatting with some of my friends in the toy industry and we noticed in the month of May that the Godzilla toy brand is some of the top performing SKS in all of the Toy industry right now and for that to come over Marvel and Star Wars and all these other toy brands I was like really just that movie allowed them to do that I actually think that because of the collaboration with brawl Stars which we know is huge with kids that's causing the Godzilla brand to get this kind of halo effect to be successful with kids so I think that it goes but both ways that all of these collaborations are

driving some of the success that we are seeing inside of brawl stars and driving the success of what's going on so I think they get credit for that I want to be clear I'm totally giving credit to supercell for yeah me too doing what they're doing they I mean they they're amazing at what they're doing right now with brawl Stars maybe they bring that to other franchises as well they already are Clash of Clans was the first one maybe it was 10 C should have had more pressure to begin with right from the get-go right but whatever it doesn't matter at the end of the day they're doing what they need to do everything's more less back at this this Holland collaboration with like the world's most popular football star right now like in Clash of Clans who doesn't as a character who typically doesn't do these kinds of promotions so it looks like some of the Playbook that brawl star is having is is kicking over there okay soor it's it's a new [ __ ] era for supercell dude goddamn New Era next chapter let's give a little bit of a kudos to tenson mean come on like T of it to give it okay all right so let's

let's keep going we didn't expect to get get held up in quick hit stumble guys has got something right Phil yes so the stumble guys creators who ended up selling it to scopely called kit games have soft launched a new mobile title called battle guys Royale I mean the konas on these these guys to go right back into the arena and do something that is clearly taken from can I share some inside baseball on this one yes so so I got honey deed to go to up north to do a podcast with the with the founders of kitka and I was like that was the only reason that why I would fly north from where I am was already super North came into this event and then like a two days before we're supposed to record they pulled the plug they said we don't we can't really do it because you know scopely and and this and that and it's kind of like we don't want to talk about the development of the game so they didn't want any publicity and I was like okay so they're very secretive they don't want to talk

about this and then lo and behold like less than a year later they release a much more egregious like move on scopely than doing a do podcast that that is like you know that would have been you know gone through the approval of scop so the the [ __ ] is on these guys and also come on a podcast let's talk about let's talk about this new game and and uh stumble guys so to k Sorry by the way I have to mention one more po game announcement uh Guild of Guardians is coming out which is basically a turn-based RPG like a squad based RPG from immutable and this is like immutable huge BET right so it's an actual real game that is more web two but you add with web three components and so this is kind of their biggest bet to date of this absolutely massively heavily funded company so it's one to watch from a web 3 perspective nice okay the rule of web 3 is never to ship because when you ship you go down [Music] I'm afraid no it's I have to admit my

expectations are very very low but like I I will play this game I will like actually do it do my best all right moving on so two analytic updates to close the segment match Factory you know we had talked about this a long time ago it was from Peak it had a very weird launch strategy it seemed to just get out there it's continuing to scale ever since it's launch it's currently sitting at 2.1 million weekly active users it's seen steady growth uh it's not blowing up match GDP but it is still a pretty healthy game and I don't think it's found it cealing yet so we'll continue to check I think it's going to be 150 to 200 million wow I mean that's that's an awesome success that's a nice little chunk of change chunk of cheese as Micha would say Zing's back dude chunk cheese wait I I are they back I'm really curious about Star Wars Hunters so there that's coming out I know [ __ ] June 4th I remember what a waste of money dude how much money they spent on that thing never made hasn't it been in soft launcher and development

for like three or four years too thought it was expensive Studio at least two years in soft launch at least it's well made I I natural motion's got to just stick with CSR but evidently it's not even the natural motion team but all right moving on AFK Journey another update there it's it's looking okay uh interestingly enough there seems to be no AFK Arena cannibalization which blew my mind it's literally the same title AFK and the same IP but there doesn't look to be any cannibalization and it's settling in at maybe 00300 million a year it's kind of sitting around 4 million a week I'm a net revenue again that doesn't include web stores doesn't include PC players but the interesting thing was an interview that the developers of liil recently gave and we won't be able to cover it this week hopefully next week it was translated from a Chinese publication they talk in that interview about hitting the slump with Squad RPGs at kind of the sixth to 12th month range but they don't really provide a blueprint about how this game is going to get over that hump so hopefully we'll

be able to dive more into that next week awesome 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 applyer 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 this podcast is brought to you by exola step into the feature of game monetization with exola exola empowers developers and Publishers to market sell connect and optimize their games globally from Payment Solutions to a full Suite of tools designed to grow

your game's Revenue while fostering a loyal 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 solutions that will help you to power your games into success everywhere all right let's get all let's get into top even though you know we've been talking about lots of things so this is the classic Eric rant I look I have been constantly frustrated with this whole Netflix communication and PR around what their strategy is kind of thinking that I actually know something but maybe I don't so maybe that's part of the problem Netflix and Roblox announced that they are launching Netflix nextor which is a digital theme park on Roblox that expands the world of fans to the favorite films and television series of Netflix the uh

Early Access today will feature uh three of their big franchises Stranger Things One Piece in Rebel Moon Rebel Moon which we all love here oh my God every Reb I can't wait for the game to come out for Rebel Moon yeah and then Jurassic world is coming out um later so okay first off right I the general like response to this has been reasonably positive and I get it right if if you had a franchise or IP and you were holding all these you want to license it to as many people as possible right that that's the strategy right that is a strategy right and you're targeting this like young demographic giving your IP a broader appeal and this would make sense this would totally make sense in a licensing model right like Disney right it's pure marketing I get it right that that that's exactly what you should do if you're doing this but this makes [ __ ] no no sense for Netflix right the Netflix is trying to build a platform

right a gaming platform and they are competing for retention and engagement on their platform directly with Roblox because they're on the same goddamn platforms they're on PC and mobile right so if it was a console game license maybe it would make sense but even then it makes a little sense because they they want to build platform they want to build retention they want to build engagement and and dollars coming into their platform so I mean there is some counterargument to this I guess the demographic of kids you know 8 to 12 maybe don't reach them on Netflix but is that really true is that valid right I mean there's all kids are all over Netflix like similar to all over Apple you know that's why Apple arcade makes sense for kids right but it seems like they have a broad audience to Market to what bothers me more than anything is that clearly from this press release the gaming team had [ __ ] nothing to do with this right like they were completely out of the loop there were no quotes from people within this Spa the gaming group you know they may

have been involved tertiary in in in the execution perhaps at most they're brought in late if at all to this process of doing this deal with Netflix with Roblox so I just want to be clear here licensing content to other platforms is not the Netflix gaming strategy full stop right that is not the strategy that they set forth with okay one of three scenarios that likely came out one is that the CEO of Netflix and some CEO executive at ROBLOX or whatever got to together and had a dinner and they basically said hey let's do a digital theme park on Roblox sounds good let's get it done licensing group makes it happen game people are with the tail waging the dog that's one scenario actually that is sort of the best case scenario because it's a good scenario but not the best right but the other scenarios do not bode well for the future of Netflix gaming so the second scenario is that some licensing group did does what it does right they line up the MGs and snort it like lines of

cocaine right and this would be a very bad sign huge bad sign right basically the company has absolutely no phase in Netflix gaming to build content for this demo so the calculus is the cost of building this content themselves is greater than the losses associated with sending customers to a [ __ ] competing platform right I mean yeah ridiculous right the third scenario which I think is likely the most likely scenario which again does not bode well for the gaming group is this is driven by the Marketing Group right again I think even more dire in some ways for the gaming group this means that an independent Silo at Netflix which has no understanding or more likely don't give a [ __ ] about the strategy of the gaming group are working independently right or two the marketing Silo has absolutely no confidence in the gaming group to build content for this demo so that likely means that Netflix is is is losing faith in the group all together right so this is probably what

actually ended up happening like the Marketing Group could give a [ __ ] about what's going on in gaming we're going to do what we do so we could attract this younger demo [ __ ] our gaming group right type thing I think it's either one or three right but I have no actual direct intelligent here but I think it's clear from sources that this goes against the core strategy of the group as a whole and likely none of the gaming guys were even read into this and on top of that they're like whing out their franchise to these chachki experiences on Roblox which is actually damaging to the franchises to something cuz what makes this all [ __ ] worse is that the experiences are terrible they are [ __ ] horrific right their average play time is like four and a half minutes according to some stat they the onboarding only 40% actually complete the onboarding which takes three goddamn minutes right and only 17% of the players are finishing the second Quest so out of all this they're creating shitty experiences on Roblox which likely damag the brand so fundamentally again this is not Netflix strategy if it was a licensing strategy if it was Disney I get it 100% but that is not

what they set out to do and this is like seems to be kind of the beginning could be the beginning signs of the beginning of the end for the gaming group but I may be over my skis here no I I have seen this Playbook before in fact I lived this Playbook when I was at Disney so my history was I was in the the licensing group for the toy Division and let me just take a step back and say first of all I I agree with you I think that the gaming group likely didn't even know that this was going on because this is what happened to me inside of Disney is there every group is siloed and I think we all know Netflix culture is each group is allowed to kind of go and do their own thing you write this paper up and and you circulate the paper but nobody really has the ability to veto other people's stuff unless you've got some really groundbreaking reason and so my guess is is that the marketing team likely cuz this is what hit me in the

past at Disney the marketing team was like this is going to be great we need to get kids on our platform we need to Market our IP and and we we want to go out what's the biggest possible platform that we could do with brand relevance for kids is Roblox so a little story time of when I was at Disney one of the things um the Disney promotions team was responsible for marketing all the movies and so they would go and do deals with McDonald's Happy Meals I think hopefully many of you know you've seen those chachy little pieces of [ __ ] toys that come with the Happy Meal and there are tens and tens of millions of these little toys that basically go out for free and so on one of the movies that I was working on I just signed a really big deal with Hasbro to do like a long-term five they're fiveyear Partners on all of the movies and so we didn't know this the promotions team comes to us and they're like can you approve these toys and we're like what was Monsters Inc or Nemo or one of these movies at the time and I had to go to

Hasbro and say um just so you know we're going to be giving away tens of millions of toys even though we expect you to sell $10 toys and we get a revenue share off of that licensing fee hasar was so pissed so pissed because it's damaging to the business that they signed a minimum guarantee they're paying a royalty rate and they're like wait you as Disney just got money from McDonald's to do that deal like [ __ ] [ __ ] you guys you're giving us a discount and so we actually had to like go in and negotiate okay how do we kind of make good on this then the [ __ ] DVD team back when DVDs were a thing did the same thing to us they would go sell a DVD with a plush toy a lovely plush toy for basically you know just like a couple extra dollars on top of the cost of the DVD and again our lies like Hasbro were like we're trying to sell that for $20 you just completely screwed up plus your whole DVD division the way that they sell it it's like a

limit like it's a fomo offer and so these are the types of things that happen inside of these big companies where you have these silos with very different goals and responsibilities this is why you need a franchise manager calling back to our remember our trans media discussion where I'm like it should be a franchise leader so a franchise leader is sitting on top of the overall brand looking at each one of these silos and making the decisions for the best use of the brand depending on where we can get the most money and the best outcome for the brand and the team what's happening right now is nobody's doing that at Netflix Disney I don't even know if they're doing that anymore but this is what's missing in this Hub and spoke model someone to kind of make that call because the poor gaming group is probably like God damn it you just [ __ ] us with like you said really shitty shitty experiences like look at the Turtle games on there you don't help your brand when you put a shitty experience on Roblox I'm sorry you become a laughing stock with that

audience instead of like a great experience okay my rant is done yeah I and even with your examples that makes a little bit of sense right you want to throw out choski shits at McDonald's and stuff it's like aspirational to buy the real toys at Walmart right or whatever right but the difference here is that they're actually trying to build a service within Netflix like to bring people to Netflix and they're literally selling themselves to the Devil by sending it out to Roblox like it's a prime example of a big company silos cutting each other off of the knees you know and it's brutal it's freaking brutal right so why not Syndicate stranger things on NBC ABC CBS Max and Disney to expand the demographic exponentially right why not why not do that right because that's your best content that's your best [ __ ] content you don't do that right and again when we first started talking about Netflix this licensing was the safest in easiest strategy right this was a criticism from the get-go why are they building their own gaming group it

makes no sense but they made that decision right and that that's what they're doing so I don't think that's fair that that wasn't the Netflix strategy like the Netflix strategy was that games are taking up an increasing share of play time that a long run specifically for fortnite specifically right Reed Hastings always used to say we compete with fortnite right because everyone's competing for time and games are increasingly taking a share of time and so the game strategy is about games being the end it's about about being an entertainment company Reed Hastings has said this over and over again are we a technology company or Entertainment Company he says we're an entertainment company and that is not bound by any form of media so I I I think they had honest intentions in games because they saw it as a part of being an entertainment platform I agree with you though that it does nothing to put these games on Roblox it's bizarre it's bizarre and it's like one piece they don't own the one piece IP Rebel moon is a disaster like Netflix IP though it would be a disaster for them to be a licensed there because it's so worthless like Netflix IP is like Cade it's awful

I don't understand how they're doing Jurassic world which is z by Universal can I okay can I just little little thing that I'm because I've been thinking about Netflix games a lot for somewhat reason but I have been and with this thing that that just came out when I was reading this to me it smells like politics and it smells like turf wars inside of Corporation it kind of is like the previous leak I don't remember what it was but it was essentially contradicting Netflix game strategy was it on New York Times or something else but this is just not a leak anymore this is an action already against the Netflix games organization and when I was thinking about Netflix games I was you know looking at sensor tower for some data as well as the public information they have invested billion dollars into games to date $1,000 million they've acquired finnished mobile company NeXT games boss fight entertainment out of Texas couple of Indie companies night school and spry Fox so I think both are Seattle based or something no one is La the other one is Seattle they shipped over 100 games out

of which majority is either failed free-to-play games that have been stripped out of uh monetization and put on Netflix or they are Niche PC hits from pre-2020 like I think they just launched Hades which is a great game but why is it on Netflix anyway I digress uh so they reached around 140 million downloads according sensor Tower throughout this time with the $1 billion and if take the GTA's out it's 1.5 million per download per game on average GTA did a lot more but it really kind of puts the like what just take those out I hear Adam teler in my ear saying why the [ __ ] are you talking about the history of Netflix again because in order to make the next claim you have to talk about what happened so they earned roughly zero dollar through these Investments till date also a fact that people love working for Netflix games everybody who I've talked to absolutely adore that place and that is a testament for them

and they pay absurd salaries like we've always joked up around and I got a new update on the salaries that I'm not going to even mention they are way more than we ever imagined spill the beans why hold back let's what is it no no what's the new number I'm not I can't I can't because it's a but I'm very happy for those people like they just wink if it's seven figures eight figures eight figures whoa anyways God so overall what I'm trying to say is they have a very positive effect on the game industry as a whole just like stimulus checks have a positive effect of consumers like can't see this scenario any scenario where this is sustainable so we know that Netflix games as a data that they provided is not really working at the moment they have 147 million subscribers and less than 1% according to them is playing games daily that's not a lot we know that Apple arcade despite the news that where they had to come out because Neil is [ __ ] posting on them Apple arcade is not a sustainable

business model it's bundled together with apple one and it kind of makes sense there they pivoted some kind of a Content but it's not what it was supposed to be it found its own small Niche the organization to my understanding is smaller than in the beginning Xbox game pass we saw the predictions of what it's going to be it's it's not working they're already cutting Bethesda Studios just to cut cost because they can't make this into sustainable Service as they're focusing on Revenue rather than subscriber growth so my point is pouring more money on a failed business model won't make it work like you can't spend twice as much as apple and say now it's going to work because we're going to spend what more than Apple Apple has more money than God and so does Microsoft by the way it's not like these are some startups that tried it and now Netflix comes in with with less money than either of two so tying it all together I think unfortunately or fortunately however you want to put it that Netflix games will be restructured in 2025 if not sooner because based on these numbers of course everything can

change and I hope that everything will change but it's not really delivering as we're talking there seems to be tur Force there seems to be this information that that that they're already trying to push the game some other groups somewhere else uh and I think that the restructuring would just lead to a more compact a lanar organization a more much more focused organization I don't think there will exit games by no means I just think that they will really focus on driving engagement I think that the type of games they be doing is less Niche PC steam hits and more like word like puzzle themed with their own IP kind of taking if you will a New York Times model with their game strategy that's kind of like where where I land on this one so it will be focused engagement driven organization Wake Me Up When the triaa game comes out that's that's the next thing I want to see from no that that game is evidently in development hell they're gonna have to can I think they're going to cancel oh no that was the most fun weird part of what they're doing that was that never made to begin with right a AAA shooter out of La of course it makes sense on a subscription

with no with no controller input method that sounds good to me just drop a stimulus check and make it happen I by the way I did try Netflix games oxenfree with the uh Netflix controller and what a [ __ ] horrific experience I mean it was like awful like a controller every time you change the controller like it would like lose connection and like it did the input lag was like terrible it's like no no no that's not going to work guys that's not going to work all right we'll see what the response is from uh the pow at be and I'll let you guys know yeah all right let's quickly get through the Xbox topic because it was such a big thing last week I feel like we need to talk about it while we talked about Bethesda Studio closures last week we didn't have the Xbox president Sarah Bond's interview with Bloomberg to discuss um this was really covered everywhere so she didn't really say much unfortunately and she sounded very corporate and I mean that in in the worst possible way unfortunately Chris did she actually make it worse she felt

really distant it was brutal [ __ ] brutal dude like she was like deer in the headlights type thing it was bad it was really bad bad for her I had to go on LinkedIn to to figure out like who's this person after like watching this interview I'm like wait a minute exactly because of the deer I'm like like what's what's going on I need to see the background it's like yeah it was it was tough so basically the quotes were just complete PR garbage go go gobbly go right and didn't really answer the question right about why you know they got rid of these like beloved teams and you know blaming like industry flatness you know [ __ ] like that it was pretty bad and uh they got to figure out a way of unwinding this terrible strategy of this subscription business or it's this basically it's going to be the end of Xbox we're not talking about that today I don't don't even know what the plan B is what's the plan B for this them I know that's the thing it's really going to be hard to come up with a plan B at this point point but it it makes sense to spin this thing off and and let it be a standalone company yeah get it out of

Microsoft that's what makes sense a lot reporting I saw also talked about Matt booty who runs the studios he did some town halls and apparently made it worse the gist is that in order to get the cost in line they had to cancel new projects in development and the one of those that they canceled was high five Rush 2 which is obviously coming off of the highly acclaimed you know highi Rush which was really Innovative and different from Tango game works you know sadly I think we all know we've been through this it's much easier to cancel something before it starts rather than letting something go and and then you know eat those sunk costs as human beings we just really have the sunk cost fallacy if you spend something in you know you spend money in it you really want to keep going on it and it's difficult for you mentally to really absorb losing all that money so the the interesting but not interesting news was that she announced a mobile store is coming in July we kind of knew this was coming as part of the merger action we

saw some of the leaks so this looks like it's a little bit more well it's all on the web is what she said it's a mobile store that is on the web and it's only going to have Microsoft brands at start so this is Candy Crush Call of Duty and Minecraft so in my mind I was like is this Android and is this side loing but maybe it's just web stores right chis this is a web store this is not a interesting at all right I mean until they can actually viably move people from the Apple Store and the Google Store to a new store platform which is a super tall order which epic is trying to do now in Europe and and the coverage of this has been really wacky and I think part of it because Eric Seaford had a piece that they he wrote recently on mobile Dev memo is like they've been talking about creating an alternative app store for years but this is not the [ __ ] it this is not it at all this is not alternative app store this is a [ __ ] web store for their IPs you know what mobile IPS how many times can I download Candy Crush what else do they

have on mobile what else am I going to download I I literally don't even know what else is in the portfolio that was my joke is it's not a mobile app store for acquisition of new games because 10-year-old games I mean although they still are downloading but I think the point is that exola should be worried with this news more than Apple and Google right right it's just like plka moving whales to a web store so that they get more economics that's all they're trying to distribute though they want to control distribution that that is about Revenue they're not trying to replace they're not trying to build a web store for Candy Crush they're trying to own distribution again and I agree it's not gonna work like doesn't do but this isn't it is it I agree this is f so yeah Eric seer's title is Microsoft's alternative App Store that isn't which is exactly the point this isn't an app store good job this is just a web store for their for their IPs for now until again they come out with like their own store app on on devices which is a very Herculean task

uh for lots of different reasons I'm not going to go into this is much to do about nothing yeah all right are we going to end it there Mishka or do you want to do your we got it we we got we got too much no more like after this how can you follow with a web three after after an interview like that like it's a it won't you what we have to we have to end some some interesting topic a positive topic with a web through you can't like double slam all righty all right everyone we will see you next week adios 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 subscribe and leave us a review on the podcast service of your choice more importantly are you a member of the deconstructor of fun slack group if you have 5 years or more of games industry experience go to deconstructor of fun.com slack and apply to join join the games industry's 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 fund

content creators thanks for listening [Music]