TWIG #283 Anime correction, Applovin speculations, Ad creative trends and Ubisoft’s xDefiant

[Music] hello and welcome to this weekend games 283 where we read and distill all of the weekly game industry news so you don't have to all right here's what we're covering today we have we actually have a lot we were a little hard on anime so we're going to talk about that baseless speculation about applovin I'm excited to tell you guys what I a little bit of birdies told me when I was at games speed take two earnings and the GTA 6 launch date window we speculate on the reason for Squad Busters road to the massive 40 million prees I don't know if they hit it yet but they're close Phil can't wait to talk about ex defiant yeah Mishka for some reason covers AB creative but that's cool you can do my job that's I love it I love totally fine yes really we're role playing yeah exactly uh cosplay today all that and

more on today's twig so hi I'm Jen donaho strategic marketing consultant at beta hat and jayen Inferno and today we have Philip black game Economist at game Economist Consulting uh I'm now a member of the solopreneur group that's my new that's my title solo preneur cast yeah oh Eric Crest principal at gossamer Consulting Group what's happening also a solopreneur also Soo 10 years now the alliance Liv the dream hey me too I'm not quite at one year but um maybe N9 months or something Mishka kov also solopreneur king of deconstructor of fun of the realm of one organizer of supper actually I got a lot of really nice feedback about the supper clubs at games beat many people would like and love to have that in their cities so that's your new hobby I have to that's my new hubby feeder of people yes of game Executives out of all of them the ones that datat

the most free meals so games speed La was put on the last couple of days Monday and Tuesday I am losing my voice because it was just chock full of people that I got a chance to see in person a lot of fans of the podcast wore my swag and so that was a lot of people like the jacket Mishka and want versions of the jacket even though you don't I got beautiful jackets like I want to wear my ensive but you know nice jackets all right so a lot of great feedback actually on some of the presentations so games be will put up the videos a little bit later but Will Wright was there talking about his new game concept the Call of Duty SVP of marketing Tyler ball was there the scopely co-ceos so Walter driver and Javier Ferrera Javier so I got a chance to connect with him before he did the presentation they all listened to the pod which was really fun and they really

appreciated all of our support and reviews of Monopoly go so that was nice uh to get that little bit of a we're we're not dumb asses um overall the focus was a lot more on the business side of things um a lot of senior folks attending Crest Mishka like I know it's tough for you don't love La for many reasons Mishka but maybe consider coming next year I I could have come I that that's relatively easy for me I always kind of like confused like games beat with um Pocket Gamer and games beat's actually much more my style yeah this was really up your alley and for the record I like La couple of times almost moved there my sister has been living in La for 25 years so I like La okay I had a great dinner and I sat next to this guy Ben cavlo who is former Netflix games he had a lot of little tidbit insights around what he used to do there he has only positive things to

say but um it was fun but more importantly he's running a new publisher called Midwest games and his mission is to create an inclusive studio in the Midwest of the US which is Green Bay Wisconsin known game development Hub yeah actually Nexus dude [ __ ] game development and [ __ ] the [ __ ] next tech Hub so ironically it is when you look up the companies that are there all of the big companies have offices is in Green Bay and so this was kind of I was like you I was like what what and I said well who's going to want to move to Green Bay and all of these different there are actually a lot of companies setting up shop there because there are a lot of colleges and a lot of cheap labor right because it's not La it's not New York it's not San Francisco and so really interesting approach so I I gave him a lot of kudos for that I also met up again with the guys from garden interactive I don't know if you saw their demo that they did last GDC but they have um they are ex that game

company so sky and journey they are just I'm in love with they're so adorable and um it was one of the best kind of chats with a game company who you know we always kind of [ __ ] on the big companies who got they they raised 31 million for their series a and I think they deserve every penny of it and I'm excited to see what they're coming up with I think they have some play testing happening later on this year Eric was not positive about them when they got their their seed round you were not positive about that you're like AAA light speed light speed this going to take so much money to get to Market um funing these aleaa Gardens Gardens interactive actually Gardens is the only one that makes a little bit of sense because they actually had a prototype and something to show that was that was a kind of a proof of concept and the people that saw that even people that I know that and really respect were like blown the [ __ ] away that one made more sense it was some of the other ones that made far less sense and we're going to see some bad juju on that in the next couple months so yeah and Eric wasn't

talking bad things about the games or the companies that were funded he was more talking about that is this a VC case like he was totally discussing it from the perspective of venture capital not even as a business so I just want to make that Mark for for CR wow F Bish coming to my defense dude what's happening I know no I'm listening I'm listening cuz people are like there's a difference between good business and a good Venture Capital case and a good business doesn't mean good venture capital thank you that is 100% accurate right oh well done I think this checks both boxes in my humble opinion this is this is the one we should keep our eye on as one that can actually do it all right so I do think at some point soon we should have a new AI segment because I saw two really freaking cool AI things number one was a startup called cyber cyb V R so this was so amazing you it's text to a 3D environment

so you type in I want uh you know a forest in Finland with Mishka running around and it actually created the environment in 3D that you can export into or import into Unity or unreal so you could use it for game production but you can also use it for marketing so it was like it's like rigged it was just it was really super cool the other one I saw was called replay. it's r p ai. so an amazing solution for UA creative and testing where it takes all of your UA and it tags all the different parts and pieces and it finds out what's working best and then it cuts together new creative automatically without you having to do anything you plug it into your UA system and it tests the creative for you all of this automatically so amazing for companies that are really looking to kind of push who are spending a lot of money on UA and need to keep that pipeline going so two super cool things so finally sorry going a little bit long but crest you're going to love

this I heard some chatter about why app loving is crushing it and the baseless speculation is that well first of all remember a while back when App 11 purchased ajust adjust is an MMP like applier it's an apps competitor so now we were all like oh God the person selling the UA now has the system that measures and allocates people to that system seems like a little bit of a comp of Interest right so finally we might actually be seeing that because people using adjust are like wait almost all of my inventory is going to App 11 H let me see if I can try to plus up what's going on with UAC Google or with SNAP or with some of the other vendors wait I don't think I can actually change that allocation so the questions coming up are is is app loving thot throttling or

overdirecting traffic to app Loven which would cause their numbers to go up dramatically H look there's lots of complexity around why they're doing so well and I don't I don't even begin to understand it all but I I know adjust and mopb were two like key Acquisitions that have made their product far more compelling than anything else out there particularly iron Source in unity I will say the one thing I did forget to mention last time is that there is a notion that I've talked to like at least a half a dozen UA people is that app loving is extracting [ __ ] tons of margin out of this business to the detriment of the Publishers themselves well in that type of situation the Publishers are going to look for Alternatives ultimately but right now app 11 is the only game in town right if you really wanted to do like targeted UA for core type of experiences there is no other option than uplo everyone else is not not performing as well even Facebook so but

in theory other competitors will arise but we will see right but that's what makes this whole industry so interesting right it's like the winners and losers ups and downs but man never bet against Adam that's kind of my rule of thumb from now on that guy's ruthless dude these [ __ ] guys I swear to God these guys are just [ __ ] ruthless dude they'll do whatever it takes you know and I never count you always got to look at the top and see well who's running the ship because that that's who's going to win you know yeah you think Jr John ratell is gonna be as ruthless as Adam no [ __ ] way no [ __ ] way dude he's a nice guy D relatively so so two things on that one is it depends on the company so I I've been talking to folks where Google is still working incredibly incredibly well for them and Google is 70% or more of their business so I think it depends on the company and their genres yeah it's yeah it's dependent on the genre it's dependent on that and and number two is the other kind of insight that I heard was keep your eye on Israel

because all of the adte and the Innovations start in Israel and start with plka they like literally are all in the same area they get that Innovation first and it usually goes into pla first so keep an eye on what they are doing if you are it's also in theory with all the iron Source guys if they start splintering off and creating their own attec companies then they could start building competitors but I don't know App 11 really has this huge advantage that no one else seems to have so we'll see all right moving on yeah moving on chilling that was my my games beak recap thank you for putting up with that you know short show so the joke solopreneurship did an episode with mate um I enjoyed conversation so that started off with mate posting this sort of a blog post about his journey as a solopreneurship so we jumped in on a podcast and then I had a fun conversation with him and then we have a deconstruction that dropped in this Monday on app loven's latest puzzle

game called modern community and this is by Amicon and it's diving deeper into differentiation through narrative so this is an interesting topic interesting game because puzzle category as we know is incredibly competitive and it seems like these new Innovations are are on the product side as much as they are on the marketing s so previously we had that merge game merge Gardens that kind of innovated through creatives and brand and really invested into IP and now we got a piece that is focusing more on narrative and very much like Sims take on it and um yeah go out and check it out read through it so this is app loven's latest puzzle game and of course they had project makeover before that and matchington Mansion the sneak app loving game that originally came out and challenged play rcks head-to-head so very interesting company and and very interesting to see what they do because of course they're Masters user acquisition and scaling so let's

put it that way Corrections anybody oh Jesus [ __ ] hell dude there's a couple doozies this week right first off I was complete [ __ ] [ __ ] about the Eurovision thing clearly clearly they were the original music competition and they started in 1956 for [ __ ] sake right some of the big stars that came out of it were Olivia Newton John Julio glacius Abba [ __ ] Abba dude Abba Seline Dion Loren I don't know who the [ __ ] Loren is but anyway had that in did you two time female winner swen what are you talking about she just won oh jeez I I only can blame my complete ignorance about European culture which obviously is partially due to my ethnocentric upbringing in America I apologize to all the Europeans out there you guys are the OG music competition with Eurovision [ __ ] American Idol is a pie of [ __ ] compared to euro vision all right moving

on have you seen have you seen any of it did you see the wolf frell movie have you seen the live that should be your real correction that should be your punishment watch the will of farell movie it will tell you everything about your I feel like I'm I'm relatively well versed in pop culture but I clearly some I missed this particular one you have to understand I have watched American Idol with my wife for the last 20 years like I it is crazy like we watch every season so it's like anyway moving on all right second correction anime uh wow you know there are some big huge fans of anime out there I just want to clarify one thing right one is that when I said anime objectifies girls and women and is creepy as [ __ ] I didn't mean all anime is objectifies women and is creepy as [ __ ] there are many styles of anime out there that do not objectify teenage girls I will also reate what Philip said is that there is no doubt that anime is getting more popular in the US and Europe now I don't have to be happy about that

but that is absolutely truth so again not all anime objectifies women I get that there's lots of different types of anime out there I just want to jump in and say I am very thankful that our audience gives us feedback especially when we are right I had lots of Kudos at games beat and when we're wrong I appreciate that people take the time to do that and I think we do a good job of clarifying where we're coming from that we make sure that we are clear that we're not representing you know everything about a topic that we're covering because again we are just a bunch of yahoos who are not journalists who do not look at everything from both sides and we try to make an entertaining podcast right and so I think on this particular topic we may have come across as a little bit one-sided and I think that we did a good job and now you just said it and explaining that hey this is you know and for me too this was like a one particular instance of an over

sexualization that I actually found a little bit offensive but I grew up on anime too gotaman and Star Blazers and all kinds of stuff so just like anything we don't want to be offensive I would have never have brought it up the only reason was to dunk on Ethan right that's like the that's the fun part right like when Ethan gets on board it's always fun to dunk on him so I apologize for anybody that offended on that side of it clearly uh anime is a upand coming genre in the west All Right Moving On All Right Moving on all right so lots of earnings um so take two I wanted to cover them first so the big news there is that GTA 6 is coming out in Fall of 25 so everybody I am so sorry we are going to have to wait quite a while but at least we have the window now what was interesting too is it it did slip outside the window that everyone thought it was going to be in so what was interesting there is that they posted a loss of 2 point .9 billion in their q1

period so this was it said it included a 2.18 billion Goodwill charge I wish I could have that much Goodwill in my pocket cres can you explain to me what the hell this means because this is like a this is a hell of a lot of Goodwill look basically in essence it's a premium over Book value and it's a counting term it means [ __ ] nothing you basically exclude it from all calculations around earning it's not a cash expense it's an accounting expense so it's like a onetime write off and it should be basically ignored okay so but what was fun for me especially was seeing what was working they did list a bunch of different things and a lot of that included Zinga so driving net bookings for the quarter were NBA 2K 24 NBA by the way they are crushing it kudos to them on the sports side we always think of EA as the sports home but they actually I think lead in exceed EA on on on a couple of aspects

of what they do with the NBA franchise so that sold over 9 million units Grand Theft Auto online still continues to chug along GTA 5 toune blast Empires and puzzles like that's an eight or nine-year-old puzzle RPG that's continuing to work for them Red Dead Redemption 2 Red Dead online WWE 2K 24 WWE super interesting they moved to Netflix so I think um asone who worked on the toy line and games for that franchise I think they you're going to see an uptick there because of the distribution they're going to get globally from uh moving to Netflix as a platform match Factory where with friends another like OG game merge dragons Cris a lot of zingga titles in here no I mean right I'm telling you like they're back to growth finally after like twoyear Hiatus of of 15 to 20% declines and you have purchases according to every other data source out there so this year has been big gear for

them particularly match Factory which is probably going to be close to almost 200 million this year well maybe a little less but we'll see and then they're they're reinvesting in Tomb blast I will say one comment on this move for GTA is that it's not a great move for the industry really right because they're basically putting it in the same window as the rest of the holiday games much better if it was coming out in May or something like that but we're not going to have that luxury unfortunately and then it also will coincide in theory with the uh switch release as as well but not ideal but we I thought I talked about this in the podcast before it it was pretty clear that it wasn't going to come there's some issues with the game development so yeah I thought we we were speculating it was spring of 25 based off off of early indications but it looks like so Strauss has literally like delayed this thing in the last four quarters right he has basically they have like revised guidance four times because of where this thing is going to land right and so they basically suggested it was coming out in March by March but I knew it wasn't coming out by March I expected it to be in the June

quarter hopefully early as early the better right for for no I think it's very astute for you to say that it it pretty much screws everybody else out of a holiday sale you know it's kind of what hell divers is doing they they sucked a little bit of the oxygen out of the room for a number of the other titles right now because everyone's playing hell divers so I think some other titles might have been impacted by that type of behavior all right Ubisoft okay performance was driven by Rainbow Six Siege and Assassin's Creed Star Wars Outlaws is coming on August 30th the preseason of freeo play for X defiant yeah Phil X defiant this is like uh what is it the symol Ronaldo does he does like the xwing scores a goal that's going to be me with this title trying to get all right so the preseason starts on oh yesterday uh May 21st Assassin's Creed Shadows is set to launch in November this is the one set

in Japan if I remember correctly they are focused on two core verticals open World adventure and games as a service native experiences this is what they're saying their strategy is so as part of the ongoing cost reduction plans Ubisoft has halted development of the division Heartland and reallocated resources to X defiant in Rainbow 6 Rainbow Six is way up yeah I I'm I'm pretty bullish on their products this year I think and I think their pipeline is relatively strong but they still have way too many people in that company oh I took that stat out I think they had I think I it was like 21,000 employees they actually have more than EA there was layoffs of like 30 people in Paris like I remember we 30 people out of like 30 10,000 that don't you know come on dude they got to cut that whole [ __ ] I told you a million times cut that whole goddamn office they don't need any of those people Eric was being about Ubisoft so I found the

trigger [ __ ] Paris dude godamn it all right is this where you want to mention your LinkedIn article no no I don't know people are people are so uh you know divided about everything it's it's fine um no yeah check my Linkin I'm so in the dogghouse with the Europeans I'm so happy I didn't put that [ __ ] post put that [ __ ] post up I shouldn't even have liked it I shouldn't even have [ __ ] put my liked on it yeah no no no Phil and I will be deported from from socialist countries any any day now any day now so I I just I I saw this article on Financial Times you know the type of magazines that I read and um and it was just showing the uh the working hours from the 70s to to today and there were some countries chosen of course us and and certain European countries oecd countries EU in general and it was showing that Europeans were consistently less and less than other peers and oecd

countries in general especially Germany was pretty much collapsing and that article really wrote about more the the importance of keeping up in productivity with other countries and it wrote about the regulations that European countries tend to have for example in Finland if I wanted to drive Uber as my second job the government would tax me 50% for doing a second job discouraging me wanting to have two job what kind of a swine that person is to even dare to do more work than the government wants him so anyways I just posted not that but I posted basically a conversation I had about a developer at Gamescom asking about 4-day work week and my point of view is that luck is the most important factor for success but the second most important is hard work and I just feel like if you consecutively work less than everybody else it's unlikely that you're going to succeed in the long run that's it I don't think that's that controversial I have no [ __ ] comment

at all none zero moving on moving [ __ ] on please I I can't have another correction like today no let's stop talking yeah we're gonna have a big correction next week okay okay so 10 cent 10 cent uh q1 revenues were up 6% they cited growth across honor of kings and Peacekeeper Elite in addition to those two big titles for them they had several domestic games that had had High um gross receipts during the quarter fight for the golden spatula this is TFT in China so I'm just I'm shaking my fist um in a good way because that was the game that I worked on CrossFire mobile Arena breakout they also cited supercell doing well from brawl stars in particular as part of the 10cent um so I I thought that was really cool that they you know everything that we've been talking about about brawl stars and how successful that's been is is going I'm surprised they're not they didn't mention dungeon fighter is aren't they

publishing dungeon fighter I thought so too the mobile skew uh maybe I missed it in my my brief recap that's a big releas just released in China like two days ago so we'll see we'll see so collabs of the week um if you ever go on YouTube and you want to like listen to some low five music when you're like working there's something called Loi girl which is just this kind of cartoon anime no not not sexual anime cartoon girl complely to uh Loi music right so fortnite I don't know if I should troll them or or think this is brilliant it looks like they're digging deep like Loi girl is showing up in for in fortnite so they're actually creating a character for her something else going on the layer licensing guys in Australia love these guys they're super they're super cool they have a platform that allows you to go and work with them if you want to do like a collab in your game and they have all these licenses to choose from so they did an article that

uh Mob control the game mob control has a pretty cool Transformers collaboration that worked really well for them they shared some data so if you're looking for ways to Showcase why these are good for you uh check them out trans media of the week Five Nights at Freddy's 2 is coming in December of 24 that is a awesome game that was went out as a movie and did really really well especially with that younger audience elevate your game development with heroic Labs The Cutting Edge platform for building multiplayer games and you need an edge to be successful in today's gaming landscape their scalable Nama server empowers you to create compelling real-time multiplayer experiences effortlessly benefit from features like in-game chat leaderboards matchmaking and more all designed to enhance engagement and retention whether you're developing for mobile console or PC heroic Labs gives you the tools to bring your community together unleash the full

potential of your game with heroic Labs where every developer is a [Music] hero this podcast is brought to you by data AI now you're asking didn't they get acquired by sensor Tower they did and that's awesome here's why whether you loved using data. a or sensor Tower the combined company will offer customers even stronger and more detailed insights on the full Digital customer Journey exciting to times lie ahead as sensor Tower data Jo forces go to data. a or sensor tower.com and get on board with undeniably the best data partner in the business now back to the episode so Mishka let's do Investments yes so let's start off with the media investment so IGN entertainment acquires Euro gamer game industry Biz vg247 rock paper shotgun and more this acquis I will make redundancies across gamer Network and I

actually saw some game industry Biz people posting on LinkedIn that they had been laid off so just uh reaching out if some of the uh the writers as they are have a sharp mind great writing skills passion for the industry unique insights reach out I think we can accommodate more writers on deconstructor of fun for sure we'll be interesting to have conversation we are growing Independent Media next part so Sweden based private private Equity Firm eqt eqt is also a venture capital investor is in advanced discussion to acquire uk-based Outsourcing company keyword Studios for AC approximately $2.8 billion in 2023 the studio Kos generated 844 million in revenue and about 139 million in ibida keward is active m&a strategy facilitated a big part of its growth since 2019 the company has closed 30 Studios to expand its capabilities and add new technologies and services to its

offer so like a successful embracer strategy almost the interesting part about this news is not only the size of the deal because that is a very good for the industry we haven't had big m&a deals in a while but it's a trend about private Equity VC buyouts so this is being seen overall in Tech and the original idea is like startup Founders and shareholders they used to Hope until 2022 for that flashy exit that we saw a lot during that time or a public market IPO but now these companies are increasingly being swallowed by the private Equity instead why this is happening is because the valuation is pretty crazy for all these companies they're raised early they raised at a very very high valuation the IPO window has closed down so you can't really like you nobody's going public at the moment really and venture capitalist who invested originally at those valuations are very

conservative in deploying Capital especially growth Capital at later stages and now the whole shift is from Blitz scaling just get Revenue at any means possible buy as many studios or whatever it is to show Revenue growth that has been flipped inside of a like a quarter to for Studios to be more profitable and and show basically quarter over quarter earnings then there's of course a Funtime life consideration if feces have invested they have to exit in about 5 years Etc so private equity's appetite for technology especially software has been increasing and private Equity unlike venture capital is a very active investor so once they come in they focus on operational improvements so what they do is they acquire a lot of studios and kind of create an entity that then can be ipoed for a for a higher value but this is not the type of an investor that sits on the sidelines they will make hard cuts and big changes to really

rightsize the business with no handholding at all it's a ruthless investor all right one clarification here this is not an embracer strategy these guys are Outsourcing game development so they are basically higher guns to help facilitate development amongst other Studios they're not creating their own content and Publishing it so this is a completely different strategy there are very few of these Outsource developers left keyword is clearly the biggest one ones and they've been aggregating so many different companies over the years so I'm actually kind of interested what the private Equity what their strategy might be for something like this but they provideed good service for the industry so yeah squeezing the Outsourcing market for sure finding something but and and I meant by by the way by embracer I meant that they successfully acquired 30 studios in a short amount of time without you know losing their ass in in profits and and cost on depth so that was my point only aggregating that that or rolling in other investment news us-based game developer Midsummer

Studios has raised 6 million in seed funding around led by transcend the fund will fuel the development of the new modern live simulation game The Sim style so this is an interesting company because it was founded by ex firaxis developer Jake Solomon and will Miller who were behind XCOM and Civilization games among others so Legendary game makers are yet again starting a new studio very interesting to see what they what they will build so uh brilliant like Sims has just been sitting there getting fat growing owns a unique demo I think Paradox is actually taking the next shot at trying to get into the Sims Market but like that thing that thing is ripe love to see another competitor go for it yeah yeah in 20122 they would have gotten like a $36 million seed but uh now we're in a new reality it's only six and that keeps the valuation in check so very interesting stuff uk-based PC and console developers Steel City interactive has raised $19 million in

founding R led by novodor uh with participation from lvp and other investors the fund will fuel the development and release of the company's debut boxing game Undisputed Phil is showing his cat uh this is the best investment news of of the uh that I enjoyed thoroughly us-based Esports company FaZe media has secured an $1 million investment for Matt kalish who will also join the board of director of the newly St Lish entity phas Clan organization Chris how did fa Clan's IPO go to do what yeah it's what they do energy drinks it's over what did he this is worse than web so if people remember FaZe Clan ipoed uh during the last frothy window of the frothiness of 2022 or 2021 could then the stock collapsed by 98% and they were acquired for 17 million but before that their valuation when they spaed uh was $725 Million so what did they s

don't buy SP how do they generate Revenue merch dude it's all about the merch so they just sell t-shirts they're trying to they're trying to IPO as a T-shirt maker t-shirt printer just just look at the uh the stock graph that stock graph it's an image for disaster when when you when you look at Wikipedia it's a short and brutal run like that company evaporated incredibly fast anyways web 3 Bonanza I always want to raise this up so us-based web 3 platform param laboratory has raised 7 million in funding round LED by anim Moka with participation of all The Usual Suspects the fund will fuel development of Harm's modular web3 gaming ecosystem and most importantly the company recently hired Steve Young former Activision Blizzard's consumer product head as strategic adviser they for somewhat reason brought this as a big news so uh this is also a way for you to earn side income is to be adviser at web 3 companies Phil would know love to do that the thing is they want

to pay you in these tokens it's just like no I don't want your funny money P pump and dump what what am I going to tell my mom when I'm like Hey My My made Believe money went to zero like I just I can't tell any fine pay fill and Dodge coins I'm not going to do the next web 3 game but there is another web 3 developer that rised let's just talk about layoffs because that's more more fun all right balers Gate 3 on a positive side opened up a new studio in war called larryan Warsaw seventh Studio seventh studio right so much for not being a AAA company yeah exactly like yeah that doesn't yeah this is not an indie guys just saying I keep you I I heard used to this morning talking about the uh hell divers guys and po World guys as being Indies I'm like these guys are not Indies it C oh my Lord po world is 50 they spent a [ __ ] ton of money they got tons of money from Microsoft they had 7 million funding and they got another at least 12 million probably

from from Microsoft to build that game if not more 20 million to Market is pretty impressive for triple a title anyway my point is that they're not in D that's my point yeah okay yeah all right he's he's correct okay Ubisoft reports 1,700 layoffs in the last 18 months um so this is part of their earnings release they announced that they went from an ungodly sum to a less ungodly sum of employees in their company so like from 20,000 to something under 20,000 so they have a lot more room to go they're focusing on open world and and games and service games Chris can I say something about UB soft so this is what I've heard is that in Montreal they used to have like this big building about like 3,000 people and that was called the bench so basically where you were in mid mid projects you would just go into this building and you kind of had nothing to do and there were thousands of people and they would just kind of keep them like this is what I heard this might be absolute misinformation but I clearly remember this being told to me and somebody even mentioned the number 3,000 like it was

it was that type of a number just people kind of like between projects kind of like figuring out you just have and hang out like what's the yeah yeah it was like entire gigantic building in Montreal might be not true please reach out if this is not true but this was told to me what did you ever watch that show Silicon Valley Silicon Valley yeah but imagine 3,000 they had like couple of people on on a rooftop and so so the on the show they had a bunch of people who were kind of in used to be called the loha Suite was like what we called it back in the day when you were still employed by the company but you didn't have anything to do cuz they couldn't fire you and so on the show they all went and like hung out on the top of a roof so imagine there's an entire building in Montreal where people do this is mishka's idea I'm not sure somebody said it might be not true again we are not journalists on this podcast but reach out if this is true Chris is going to lose his [ __ ] no no I'm more worried about the layers of assistance to assistance to assistant in

Paris that actually don't do anything right that's at least they're the game developers right in Montreal all right moving on Pixar this is not game related but Pixar Cuts 14% of its Workforce that's relatively significant and again it's shifting back to feature films is kind of what they're talking about so this is a warning to those people that are doing subscription in video games subscriptions in traditional linear media are not doing too well cuz part of it is that they're not going to be focusing on building things for the subscription service they're looking for going back to feature films where the money is right the model doesn't work guys just saying Phoenix Labs makers of dauntless and Fay Farm are closing down this was discussed on the slack channel so I have no other information that was on the slack channel so they the conversation that on do slack channel was that they there's an undisclosed amount of people being laid off from Phoenix lab and apparently a lot of games that were in development which they had quite a few or a handful have

been seized to be in development so according to the people that were posting and this company is known for dauntless which was a pretty like it was like a free-to-play monster hunter game and faay farm which I believed it pretty well on Nintendo switch and then this company was acquired silently quietly by a company called Forte a web3 platform that we have not heard much about and this comes the news sometime after the acquisition so that's all we know about this one but uh but they did not publicize that they were acquired by by Forte so that's all we know based on the conversation on slack Channel and what I will say is that dawnless was by all measures a very very high quality wellth thought out game it just never really took off from a monetization perspective I played it on all devices PC console and and switch tens of Millions of dollars they spent on these games pretty crazy all

right anyway moving on yeah and Gina acquired them and then they acquired themselves back from Gina and then they sold Forte so uh it was an interesting story if if it ends now it's still worth worth learning yep step into the future of game monetization with exola the premier partner for game developers seeking to expand their reach and revenue exola provides a robust Suite of tools designed to enhance user acquisition Dem demanded subscriptions and streamlined Payment Solutions worldwide unlock new markets and maximize profitability through their customized secure payment architecture and dedicated support team exola powering game developers to achieve Global [Music] success this podcast is brought to you by apps flyer in today's Digital World understanding your apps Journey from Discovery to download is more than just insightful it's essential enter apps

flyer 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 all right let's talk games Phil lots of stuff this week yes and as we were talking about last week they had passed uh super solid passed its 30 Million pre-registration number for Squad Busters they added a 40 million 40 million milestone for players and Jen I think you were checking out about how they've been able to achieve this number there's a little bit of cross linking or cross promotion so this is super cool so in inside of the game inside of brawl star or Heyday or any of the supercells

games so number one is all of the games are running a promotion to support Squad Busters so if you go and you pre-register for the game from inside of a super cell game so you go to the news section you see Squad Busters you scroll down you hit the button it takes you to literally go and pre-register the game I don't think I've ever seen this before I am pretty sure that this is a brand new feature from the platforms definitely from Google Play that allows you to pre-register a game from inside of another game what a holy [ __ ] moment to allow you to cross sell this especially across the portfolio so if you're a scop Le if you're somebody else you should be calling up Google and apple and being like how do I get this into my next game to be able to do this but they've set up an event structure they've done a really nice job of making a fun event that makes it rewarding for you in your current supercell game to go and pre-register and take part in the squad

Busters event um that's going on so like kudos to the marketing teams and the game teams for really integrating that I think that this all of this event when we look back on it is going to be why I mean they are doing a lot of media but this is a key reason I think organically that is going to lead I I don't think they can track it maybe they can but um super interesting sorry in a launch next Wednesday Squad Busters will be going global and we we actually just recorded a podcast which will be going out and I think we're a piece peace on the website right Misha next Monday we'll have both the the podcast with three solopreneurs on that podcast with with the blog post coming out you shut the [ __ ] up with a solar entrepreneur thing seriously so I love it the question is will this game make money that's all I want to know absolutely it's going to make a lot of money we were talking about on the podcast we'll have more follow up on this but you know supercell has not been a great investment for 10 cent it's not looked great brawl stars is hot right now that's a part of the narrative as well but for them to reach record

Revenue annually for the year so their highest revenue on record this game needs to do about 250 million and when you look back to brawl Stars I think you can absolutely get there it has a really interesting economy model consumables are a really big part of this it's its own genre it's highly accessible I think it's going to get portfolio High download volume based on the IP I'm all in I I really I had multiple versions of this piece and I kept editing it and it became more and more positive as I played more and more I kept having to delete things and they have made me into a Believer all right they're back wow okay yes big way and not only that I would say the game has unique scalability so I think as they increase headcount this game is going to respond to increase in headcount in particularly beneficial ways I don't think all games respond equally they have very clear content pipelines just like a match 3 game like how can 2,000 people work on a king game because Match Match 3 has very defined content pipelines that make that possible and I think I think this game has similar effects that will be interesting to

watch another game that's launching very soon is multiverses uh from I don't know the crypts the freezer whatever it may be this was a PVP fighter that was by WB Games it included a lot of their IP not so dissimilar from Squad Busters by the way Squad Busters is two separate words that's one thing that's driven me nuts they can't just like make that one word for some reason but multiverses is coming out let's see how it does it's later this month it's going to be launching as a free-to-play product remember they did some paid SKS when they were in soft launch I guess soft launch early on beta they're coming out they have a new PVE mode that seems to be part of the big update and I think this is actually going to be a moment for 2K or 2x KO which is riots free to play Fighter game which is coming out later as well can you sustain one of these as a life service game I know we've s seen uh bralla which has been a live service fighter we've seen some of the more traditional ones like Tekken Street Fighter but I don't think we've really seen a free-to-play ESS here be really interesting to see how this one does and and to be fair it's it's more

of an arcade brawler similar to Super Smash Brothers Nintendo Yes Super Smash Brothers in terms of charts for this week ghost of sushima debutes at number two on the steam chart this was another PlayStation title that is a part of their porting strategy we saw Hades 2 we were covering that last week it's in Early Access it has dropped this week from number two to number eight on the bestseller charts which is actually a pretty large drop I think for really hyped IP I'm I don't know if I'm sweating right now but I also found out that the original Hades was up in terms of PSU and it actually was higher than Hades 2 so they might be running a sale there might be reasons that this is getting reactivation we see this with franchises people go back and play the other games as we know but it was striking to see that the original Hades is doing more than Hades 2 right now hell divers 2 maker Arrowhead games has announced that they want to slow down their update pace which I thought was pretty interesting to hear they quoted as saying we want to take some more time for this one and potentially between future patches since we feel Cadence has probably been a bit too high to be able

to maintain the quality standard we want and you deserve so it's really interesting just to watch this team try to do live service and try to build essentially the plane in Flight da is still declining let's see if this one can hold on this still has a potential to be you know a huge winner coming out of 2024 brawl Stars looks like it might have a new Revenue record in May let's see how they end up closing the month it could maybe get to 40 million in net revenue I think the question to ask now for brawl stars is where is the ceiling and so what I ended up looking into was the cumulative amount of Revenue supercell games have generated monthly since their individual launches and there were a lot of surprises in that chart but it's really a story about how well Clash of Clans have done it's operated on another level in terms of Lifetime Revenue Clash Royale has done exceptionally well and it's really only recently that that game has had a major declines and brawlstar actually has a long way to go if it wants to get to the hyper EP Shon in terms of long run Revenue as some of the other titles here

let's see where Squad Busters slots into this but you know despite brawl star doing really well it has a long way to go to reach some of the other games trajectories remember love and deep space this is one of the games we were talking about it's a very interesting title with action RPG elements and also some dating Sim elements it's moved into 16th Place in the worldwide top grossing charts doing 9 million in net revenue 60% of that revenue is from China 6% is Japan and here's the thing 10% from the United States seeing some decent concentration more than Japan now now to be fair we have more people in the United States but still some decent penetration and the last thing I'd like to do is a small prayer for arklite um the game from blizzard you know we've been covering this for a little while I just kind of want to like say a small eulogy this thing is absolutely dead last month it generated very little amount of Revenue in April it was 1.4 million uh they apparently are still doing updates I think they should stop and just like lets one die but mean Warcraft Rumble Warcraft Rumble excuse

me not AR uh Warcraft Rumble sounds like it should go to Netflix it should go to Netflix games that's what it looks like holy crap remove microtransactions and ship it I I I think there's a really interesting marketing story about why this IP did not translate to mobile I think we've seen that a little bit more especially with some Ubisoft stuff but like a lot of HD IP doesn't work that well in Mobile and getting the teams it's not the IP it's the teams think it's teams what was wrong with this this game this game felt properly staffed no it it was Clash Royale copy like all the Clash Royale copies kind of die there was even there's so many of them so many of them same Les was Clash of Clans like this was too close actually I'll look into this one this is actually really interesting do you think the monetization design on this was strong enough if it was a different IP is that what you're suggesting it proved it proved to me that blizzard could actually monetize aggressively like there was some very high payment caps in this game yeah deconstruction can be found on the blog I think a nice 30 pager of that game and

also as you mentioned earlier dungeon light a dungeon fighter which has been like one of the top grossing games of all time correct me if I'm wrong Eric on PC particularly in the East you know on PC has has launched in China on mobile the first time crazy crazy hasn't been there this thing's been in development for forever right it's supposed to be out years ago but it's been held up because of draconian China law right so but they're finally getting it out and there's a lot of mixed reviews on it but ultimately it's one of the biggest games in China so it should do very well all right why don't you continue with the X X fine is out um this is by Ubisoft this this thing has been in development forever I mean if you read some of the early media reports There Was You Know news that the executives were pushing it more to be like Call of Duty some people were resisting that ultimately to give you a description of the game it's an arena shooter very similar to Call of

Duty I would say that a lot of it feels like it's basking in the Nostalgia of the Black Ops franchise which has been a little bit more hero shootery in the Call of Duty uh entries it also has you know Health packs that you can use it has a little bit more of that arcade element as long you know with those those hero elements and this is a I guess a free-to-play attempt to enter this Market it came out yesterday and the launch was sort of a disaster you were not able to play the game for the first couple hours the the matches were not able to connect and this was of course on Ubisoft connect this is the only place you could get this game on PC was Ubisoft connect for whatever reason when you launch this new franchise that's free to play and you want you want this to be a trojan horse you are going to limit it to Ubisoft connect who has Ubisoft connect running on their desktop why would you not put this on Steam on EGS everyone has conceited at this point it's just baffling to me you could preload it you could preload it beforehand and I did that but you could not find a match up to eight hours before you know during launch I mean that embarrassing I think for Ubisoft

embarrassing for UK connect so I don't I don't have a big review for you guys because I couldn't I couldn't get into most of the game I I I couldn't play I had the exact same experience I really actually wanted to play a little bit I actually did play one round and it feels like a poor man's OverWatch but again I need to play more but the but the tech was all down I think it's okay now so maybe next week we can come back with some hot takes what do you mean by poor man's OverWatch the mode I played was exactly the same as a mode that was in OverWatch we chasing something through the map and and protecting it and it's Squad based payload payload thank you and it just didn't feel that great it felt very it's very meh you know it's not there's nothing really too unique in interesting about it um versus OverWatch which had these amazing over-the-top characters and in insane different powers and stuff like that like this seemed like a just dressed down OverWatch but we'll see there was a YouTube comment that called it it looks like a Xbox 360 game

like the graphics like and I actually don't disagree with that it has a certain Sheen to it I mean and here's the thing like ultimately Arena Shooters are in like a really bizarre place there aren't a lot of Arena Shooters right now like Halo is down in the dumps Call of Duty exists but what has been Call of Duty's growth factor it's been war zone like that's been the big growth of the franchise there have been attempts at this so I looked at a game for a while called shatter which is from a Ukrainian company it's actually pre-released on Steam they've been looking for a publisher for a long time they have executed on the core gameplay of Call of Duty to a really high degree they have some of the character abilities I think it's a really well polished game maybe not well polished but I think it functions really well it has never really gotten the traction so I don't I don't really just understand this thesis of this game like I understand going after free to play but I don't understand going after Arena Shooters like you don't it's just it's been what six years since it's been in development like maybe the thesis has just kind of like dried up yeah exactly I do want to reiterate the fact that maybe I

overemphasize and this conspiracy theory stuff but the fact that it's not on anything but you play Connect is a sign of big problems at Ubisoft right like how in the [ __ ] can that decision actually be made if you're building a free-to-play shooter in which distribution is critical you put it on everywhere right you don't limit it to the smallest [ __ ] footprint service on the planet right like it's crazy it's crazy so from my perspective it it just shows like how disconnected people that are making decisions are I can't imagine the team wanted this just on you play right on PC right it's like they're making decisions from 15 years ago what EA did so you know CR I don't know if you were still there when we when EA created origin right and then we're only going to launch EA titles on origin and then look you know look at where we are today where FIFA and everything FC and everything else are on Steam and on Epic store because this

very Point has happened and Ubisoft is like let's be EA from 15 years ago and force people to our shitty platform and and it's not that I don't get the strategy I totally get it they want to build up you play direct relationship with the customer blah blah blah blah blah 100% but we you are far past that that that that that was over like sorry eight years ago five years ago six years ago still use Ubisoft accounts in Steam that's what blows my mind like this has been kind of negotiation this is how like EA got into it is there's a thin client like origin runs behind the scenes you don't need a separate installer it runs as a part of the exe and steam so anyway so this is the same thing with the Netflix thing you know I wrote that article about Netflix and like everyone's all yeah this was just pure marketing doesn't mean anything doesn't mean anything for the games group it's like really really are are you guys that myopic and you're thinking that like it has nothing to do with the overarching strategy of of the of the company that they will allow this type of [ __ ] to happen so like in this case like the things that need to go wrong

for this to happen in which you're only on you play are so profound that like the fact that software is a service is a key strategy and they're releasing one of their Premier games on one [ __ ] platform that no one gives a [ __ ] about that's a problem right that's a [ __ ] problem within the organization that this decision is made and that this is not yeah anyway question for you so is it a rollout strategy like is it hey we're going to do you connect for the first couple of weeks see how it goes and then roll it out to like I actually just I honestly don't know if that was the strategy maybe I could kind of understand that but even yes that I actually will capitulate that is actually a reasonable thought process but I don't think that's the case you want the biggest bang now like this is when the most interest is going to be you're going to get people in you're going to build you know the zeist around it you get the you know influencers involved like that doesn't make sense to the strategy anyway but like but I but I I could understand from a technical perspective clearly they're

having challenges but yeah anyway now on the arena shooter we didn't talk about this but Marvel Rivals at of netes was in a closed Alpha from May 10th to May 20th and uh the general kind of vibe and Buzz around that has been you know talking about a an OverWatch competitor you know that looks pretty cool so it's it's interesting the the other one piece of news we don't have in here was Valve valve's game is starting to get leaked we're screen yeah we're starting to see some of that which is supposed to be a third person Arena battler I think there's a huge jump between first person and third person I think that's that's a bold decision I think that also changes the audience to some degree I'm sure there's a vend diagram that overlaps them but I think what what people are trying to make sense of is Smite which has been around forever which is kind of a third person mooba which has been on Steam and there's been kind of you know One Direction you can take it which is let's go in terms of paladins which is from the same company that makes fidas again where they don't have little

creeps that you're trying to attack you still have these characters these RPG elements a lot of in round progression I would separate those categories I think they're operating in different genres I wouldn't put Marvel in that same category as Arena Shooters maybe competing for the same pool of players I don't know what have you seen it no it's the same game Marvel Rivals compared it's OverWatch in third person in a 6v6 arena with [ __ ] superheroes dude it's pretty dope yeah that team up I got see the leaked video then yeah yeah there's a lot online about it but I mean this is directly going after Marvel rival is actually a point an opposite Point like when you look at this thing you can see the characters are are the star of the show right like OverWatch and so this is why you know ubisoft's game just does feels flat because the characters are not all that interesting free Call of Duty ironic considering it's from multiple different parts of ubisoft's franchises so when you play X they have different factions the factions are different franchises so they have Splinter Cell

which is again this is the third by the way this is the third Multi Universe game we've talked about in this episode if you if you want to identify some Trends Squad Busters multiverses exiant I guess you could probably even say fortnite in a in a in an interesting way no I did you know we can no longer call it a metaverse in fact I was talking to someone from epic and and they pretty much have ban that word from from all use internally but they have another way to talk about it which was something like social persistence so I I I think that there is something about how do you have a socially persistent environment where you can also have IP be persistent throughout that environment as well so you know in like in fortnite you can when you unlock Luke Skywalker in fortnite you can also unlock L Lego Luke Skywalker and other versions of of that IP which is

metaverses do you want to talk about creative yeah let's just let's just take take let's take this home with creatives by the way when you guys are talking about metaverse all I'm thinking about there was this event that Su and I were actually sitting next to each other it was a small event with with the iron Source uh or Unity back then and then Jr was given a presentation about metaverse and I remember it was so like high level and then after the presentation ended he ran away like he ran he did not walk away he ran away so that there was no questions cuz I remember super was like he ran away he the he ran away like he kept saying those good times I love the metaverse times even the book that you guys reviewed at one point those were good times 2021 2022 good times you know you know who really killed it is Mark Zuckerberg like yeah everything that has happened with Facebook has just absolutely kill that idea and not that idea was ever going to happen anyway but

I think you know the idea of like hey let me have some characters from across different IPS inside of a game because that's really fun the best execution like the only metaverse that exists today in a real way is fortnite and Roblox like those are those are actually mini metaverses in in my humble opinion but so on the ad creative side can you can you just say reference people to the article any any like top yeah yeah the state of AD creatives in app marketing 2024 Edition it was a really interesting so I I try to read read a lot of these reports and this one was definitely not in in my wheelhouse so hence I was reading it thoroughly so this was about ad creatives it had a lot of interesting tidbits and information for example going deeper into the hero Creative Concepts where how many on average ad Varian to requires to find that one how much of the budget of the top Publishers

goes into the hero creatives versus the other ones uh the role of creative strategists and use of AI in Creative development especially with the uh with the fast iteration pace and the need to have so many elements as well as the use of AI when it comes to narrowing down funnel data or or just going deeper in in understanding how how the ads work that was covered there was stuff about hyper casual games I know Chris ran away as soon as we started talking about user acquisition but interesting statistics so IPM which is installs per 100 Impressions uh for hyper casual games was 48 which is bananas like half of the people that see an ad for a hyper casual game end up installing that in contrast when look then when they showed the numbers for other genres RPG was the lowest downloaded with an IPM of three so you need to show 300 ads to get basically three installs that's the uh

the approach is it a th sorry sorry 3,000,000 you're absolutely great insu per Mill so yeah per th impression and then on the other one I was surprised that match has only IPM of 8 I thought that match games were much more downloaded but that really tells you why the CPI is so high because CPI comes from CPM so cost per thousand impression divided by installs per th impression and so the insults per thousand impression is how interesting that ad is how much it entices users to downloaded when they see it there were a lot of interesting trends that they were talking about with these ads especially they were kind of looking at three different ad variations there was the ugc ad so those are the annoying ad where there's sort of a fake influencer that is kind of talking about the game then there's the gameplay ads of course where you show the gameplay and then there's animation ad which are those expensive ads and the the whole point there was that they're seeing the best results where these are matched up

together so it's not enough to just have the influencer it's not enough just to have a gameplay but influencer and gameplay or animation and gameplay or animation and an influencer so there was a lot of uh data on on the mashups and then finally on the trend sides it was interesting report because this was from apps lier but there was a participation from Tik Tok and S playay so you kind of heard from social platform and you heard from a company a Social Casino company that is doing a lot of um difficult UI for casinos of course uh and then the on the trend side what they were saying is that the creators are becoming uh at the Forefront of advertising interesting so influencers and basically saying that anyone with a story can find Their audience accessible tools enable anyone to produce professional quality content uh this is also something that that Tik Tok uh is especially kind of spearheading with all kinds of tool sets for micro influencers as as they're saying then there was naturally The Talk of all typee of automation tools that streamline the task fuel idea generation

integration of automation tools we really reshaping the creative workflows creative optimization elevated to new level so the AI tools basically and then there was finally the counter Trend that we're seeing and that is the loss of human touch as you're adding so many of these tools you're automating everything effectively you're running all these these tests and that's beneficial for your speed and productivity and efficiency in that cost but the overuse of AI risk homogen God damn it it risks that things look so number one is I think I lost my job congratulations to the new marketing expert on the podcast that is Mishka um but number two is um I think we just like you know AI is not going to take every artist job in game development AI is not going to steal all of the UA creative this allows the team to have more time to go and innovate and actually I think this is great because

the creatives that make UA creative are not like [ __ ] yeah I grow up in life and I want to make UA creative is my job but now because UA is taking all of the boring [ __ ] out of the way for them they can actually be more creative and be more Innovative and come up with new ideas and spend their creativity on that versus I got to figure out like the hundredth way to what's the color of the fingernail on the the hand that I'm putting on a match three ad so that's the positive spin that I I think we all need to think about when we think about these AI tools taking over the world is takes the mundane stuff away from us which is great which is actually brilliant it's it's it's interesting when we think about does the AI learn from the way you succeed in one company that tool that third party tool and then tell the other company like yeah when you're adding the finger that do does the match three the finger is going to be exactly the same because the AI knows that's the best way and that's the

homogenization of of the hog hom so the answer is in when I went through the platform for replay that I owe is kind of yes they do look at your own creative they match it against the industry creative and they run the tests to see which in the case of your specific game does work the best so there is a little bit of yes and no like like they they they take it but then they also test it and so over the course of 5 to 10 weeks you end up coming out of all of these tests of these iterations with top performing creative based off of like whatever that is that works for you so I've been kind of like diving deeper a little bit into these tool sets like what AI has been doing is crazy there's this one company called pool day. a and they create ugc videos in seconds so those kind of like where where a person is telling about a product but they built their Library by having hundreds of people like actors coming in of of different colors and

sizes and forms and everything and now they have this Library so you don't have to kind of interact between the creators because you kind of have them as an AI and now you can instantly do infinite variations to find the creative so just pointing out the same thing Jen as you were saying is like this goes to everything not only the animated ad but also now ugc ad and the gameplay ads and and AI is really pushing the amount of creatives and how fast we can do them to find what works yeah I think that's right and I also think there is an element of paying creators so the micro creators that you pay whether it's through Tik Tok or other channels is getting the rights to use that creative Insight of your own paid UA and just making sure you have the contracts to be able to do that because you're leveraging those humans who are making the content for their channels so there's two elements one is ugc with fake people and that's fine the other is getting contracts done with real people who are micro influencers to then use and you bump that with your own paid UA sorry Phil you've been trying to

jump in go ahead yeah I'm I'm good well you're good you're good okay I think we're all good I think we're ready to rap are we out of the mck marathon session that was a little in the weeds for me dude all right you almost fell asleep he almost put you on your rocker yeah we got a big marketing audience as well they need they need to know what's going on love this stuff a lot of a lot of positive comments about talk about these topics my world this is the other side of the battle there's product there's marketing they go hand inand you can't just forget about it all right well until next week thank you everybody later you did it you made it to the end of the episode is 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

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