TWiG #293: Twitch Loses $1B while Apple Admits the Truth about VR

[Music] hello everyone and welcome to this weekend games number 293 oh my God we're almost at 300 folks where we read and distill all the weekly game industry news so you don't have to sorry I'm a little low energy today we have Co in our household so I'll try to overcome it here's what we're talking about today Monopoly go passes three billion you know that little spot on the board it has a big three billion on it Hasbro stock says thank you to to scopely for that by the way Zinga brings back Jon Snow brings him back to life for a new Game of Thrones puzzle RPG lot of branding questions Phil wants to talk about which is going to be fun many Microsoft game divisions are unionizing and Apple rcade developers gossip to Neil long at mobile gamer. Biz and so we can't help but talk about what they're

gossiping about so we'll get to all of those things and more hi I'm Jen donaho strategic marketing consultant at beta hat and Jaden Inferno and today we have Philip black game Economist at game Economist Consulting let's cook this is my new this is my new catchphrase fire I'm done with hey hey I'm done I've asserted my Swedish self let's cook now did I just I destroyed it for you last week yeah yeah I never want to hear that again Eric Crest principal at gossamer Consulting Group and wow add what's up punks and Laura Toranto senior director of product at Big Fish hey I need a catchphrase too now it feels weak compared to yours Phil let's puzzle match I don't know let's let's polish some gems oh oh that's funny so the first thing I wanted to chat about was I was in the App Store I have an iPhone I'm on iOS and did you guys notice the new layout in the games tab of the App Store it

kind of feels like when I scroll through the Netflix groupings so at first it looks the same but then as you go through it's just these like blocks of what we're playing now must play games based on your latest downloads so was there like an announcement or anything or is this just like a quiet roll out of a change in the App Store layout I don't know anyone I I think I had seen this before and remember this is only on the games tab it's not on the today Tab and I would assume the today tab of course gets the most amount of traffic since it's the landing spot oh I would disagree with that the today tab is awful certainly it's the edit that's certainly dude that's exactly why the [ __ ] store is awful right it's editorial [ __ ] dude on the on the Today tab on the main tab that you log it to is [ __ ] stupid absolutely ridiculous why is anything written on a store it doesn't make sense Make It Stop bring back the top 10 please bring back the top these are so

go to the other IM these are kind of top temps but it's like the groupings like so when you're on Netflix and you're like you know comedies of the day or you know top Emmy driven shows or whatever these are the types of groupings that are now in the games tab so I was predominantly just looking at the games tab they don't have ranks I think that's important like ranks are not coming back like it just says what happening now so that still seems editorial to me well it's curated and so I don't know if they're programming that and if anyone sees any changes in their numbers I would love to know if any of these changes are driving anything if it's helpful or if it's just another I don't know if these are new I think I've seen these in other regions before to me I think it's all about that landing page though what happens there all right Chris can you please update everyone on your addiction oh my God after my trip to Blizzard I [ __ ] dusted off World of Warcraft and needless to say productivity has hit an all-time low I now have like four level 70s my main is like almost 500 gear score I am ready I

am ready for the next expansion and I did it in record time in less than like a week almost by the way the previews of the next expanses are the best because you can [ __ ] power level your characters like in like no time so I am I am absolutely loving it but it reminds me and part of the reason I got back it is wow is clearly the best video game ever made I will argue this to my dying day right it has all the components of why gaming is so much better than passive forms of entertainment it has persistence progression story skill production value expiration and so social all in one amazingly put together package so Brian deante and who else is over there that I know are all working hard and we're talking about it later they're all part of a union now which is all really interesting but anyway I'm back in all that my life is completely on pause until I level cap the expansion

so don't call me don't don't even talk to me please don't expect any work to be done by Eric Crest it's a [ __ ] sickness though with me like when I get into something like this it's like I just can't stop thinking about it we're supposedly having this family dinner and all I want to do is go down to this like appointment mechanic [ __ ] that you go in and you kill something and get like like high level gear it's is a sickness Absol what you tell your kids when your kids say I want to go play games you know I don't I don't want to go to school I don't want do my homework you know I play games does he what's your defense I'm not playing piano I want to play NBA 2K for the 10,000th hour right no yeah I gotta keep it on the under gotta try all right so a few things to shill mishka's latest podcast is all about the dma if you are curious how that worked with Mr Archie and by the way Archie dude fix your [ __ ] man like there was way too much background noise there's a [ __ ] dog there's like

chopping there was like so much [ __ ] going on in the background that was like it completely [ __ ] the message actually the podcast is really good it does explain the dma much better than I can ever explain it and he knows his [ __ ] like Archie is like a dog with a bone dude if once he gets into something man he never stops like until he knows every single thing about it but yeah you got to get rid of that dog anyway put him out in the yard all right one other thing to shill it's kind of a pre-chill so I'm going to do a VC 101 podcast with three amazing VC folks so I would love to get your questions or topic suggestions I always come into this a little bit on the ignorant side because I was always at the bigger companies and I didn't have to always go out pitching for money all the time so if you want to ask a VC kind of some basic questions send those along to me and I'll make sure they get make it in the podcast that we'll record later on in August all right some clarifications oh I don't really want to go into this too much but

we had all that licensing talk last week let me see if I can break it down because it works a little differently everywhere so this is a clarification because I am not wrong but let me clarify something great way to start a correction I just I just want to clarify dig my heels in cuz I'm going to dig my [ __ ] heels in cuz I am not WR what are arguments with your wife like yeah I'm I'm clarifying my non-correction went away I thought about it yeah I'm right yeah I I I yes so all right so for most games most games the challenge is everyone's like well what about this like tiny exception to the rule over here for most games the game team will pay the IP holder a REV shareer for the use of their IP in a game especially if you're selling a skin or you're selling something that is a red share rev share if you have admon there's different models like stumble guys but you know stumble guys will pay

for an IP to be inside of the game that's how that system works now there are things that are promotional Partnerships and I mentioned I actually talked about this last week like when you're a movie promotional partner there are some cases where there's a barter system where you do agree to both sides will kind of exchange value and in some cases this is how things work and so this might have been actually the case for the Cyber truck I had some folks tell me that Tim Sweeney and Elon Musk are actually buddies and so the cybertruck example if they weren't selling a skin and I don't know if they were or weren't if the Cyber truck was just rolling around the world that is likely just those guys are buddies and they just did something fun because they think it's just really really cool so in some smaller cases there is a barter system where it is just a marke exchange and that might have been the situation in the cybertruck I don't actually know but that would be my guess does that help to clarify

Phil since you were the one yelling at me I think the difference is always between the normative and positive statements there's there's what is and then there's what what ought to be that's what I was arguing for I think there's of course this is how most licensing work you'd be out of your brains and not to admit is how most licensing work not all licensing though and I think our debate is over who exploits power in this Contracting curve who can take the mo line share of Revenue you know if this is a distribution Channel then they should take Revenue uh that should result in lower rev share or you know even the license or pays the other person you know if it's really that powerful and the Halo effects are that powerful then that's what you want you want to put your IP in all these different platforms because you're going to get all this other uplift so it's not an argument what is what you know they could potentially use to exploit their own Brands and to increase the the power and and you know the relevance of them I understand now that that is a fair comment if you want to put your IP in a game like brawl stars that has 50 million da you know does supercell have

the ability to say well you know why don't you pay us a little bit I think that ends up working itself out in the Rev share or in the barter system that would be my argument though is if this is the case if the halo effect is this large then the bidding amount for partnership should at least go down to some degree if there's all this all this auxiliary Revenue that you're getting and I think it does I would expect to see that over time and I think it does and I think certain Partners most likely epic can command a different rate and approach than you know some of the other smaller companies do I also think that to your point later on is when you have a roblo now Roblox is its own separate world because because it is ugc and because of the ugc nature of it the business model works really different where an IP holder pays for somebody to build a world inside of Roblox or inside of ufn and so that is a very different economic model that isn't the typical

kind of more official licensing model that means how powerful you are I mean we're talking about look World North later which just signed a deal where they're going to have Gundams inside of a fortnite island I'm sure Bandy Namo didn't pay epic for that or epic didn't pay band NCO all of that happens off the table and that's just because fortnite is such a powerful platform so okay do you start to look at brawl Star as a platform like these are sources of users that they start to control distribution this is classic aggregation Theory I think we should get the layer guy in here he could probably explain it all at nauseum I love how you don't believe me this is how Okay markets so Comic-Con wrapped up anyone a geek here Comic-Con 2024 if you're a fan of geek culture make sure to check out the Recaps did you see who is Dr Doom from Marvel in the multiverses of actors at play isn't he 75 years old at this point like how can he be a a villain you know well more importantly he's [ __ ] Iron Man man so Robert Downey Jr was announced to be the

new villain Dr Doom in the next stage of the Marvel Cinematic Universe they had to completely change everything cuz Jonathan I forgot that actor's name who got into a lot of trouble so they were doing King and they had to like scrap all of that and shift to a whole new villain but the villain is Iron Man I will say that my son is the first time he sounded excited about the MCU was when this was announced so maybe that tells you something like focus group of one yeah no it's amazing how geek culture extends to pop culture now all right other things going on sag Afra did actually go on strike which means that the voice and motion capture union members are asked to not work for almost all of the bigname companies so sadly if you're working on one of those projects look out for folks that are striking from newu our friends at newu are very kind and they send us kind of these bullet points each month just to let let us know what's going on here's a few

stats number one is valerant so across all platforms they have reached the top 20 on both PlayStation and Xbox following its closed beta launch on June 14th so I'm super excited to see how Riot's first forray into console goes top 19 that's [ __ ] mice Nets on Xbox PlayStation it's a beta it's a closed Beta And by the way a Clos beta oh it's a closed beta a Clos beta all right I mean that's why I brought that up is there's a lot of pent up demand for especially Val to get onto console last week we talked about Warner Brothers buying the multi ver Studio player first from an engagement standpoint they captured some attention in June Rising 11 spots in the overall ranking and was a most play game in the fighting game genre and it released in May 28 all right hold on a minute okay I hate these stats you cannot rise 11 spots and say that that's good if it's 17 overall 50 on PC like six dude anything below like

top five like you would even [ __ ] who gives a [ __ ] dude this is just us it doesn't matter it doesn't matter us is the market when it comes to this sort of their stats are us and Europe okay yes okay but still it's like UK and UK and us anyway no like no this is doing terrible terrible yeah totally terrible B terrible terrible terrible this was an aqua hire at best for player first you know all right okay moving on here we go Monopoly go hits three billion in Revenue so Hasbro is just so thrilled with this Hasbro beat Wall Street expectations for the second quarter on Thursday thanks in part to growth in its digital gaming segment they are now the top Lor of video games over the past year because of Monopoly go they expect to generate around 105 million in revenue for the full year assuming a modest monthly Revenue Decline and consistent marketing support CEO Chris Cox said during the

company's earning call that is all in on digital gaming chris5 million that's it that's it well yeah actually there was a quick correction I did get some push back on my characterization of Hasbro in that they don't have like triaa teams I'm very aware that they have AAA teams I think they have four or five like AAA teams what I'm suggesting is they are not of the highest caliber AAA teams that are capable of delivering triaa content that is contemporary so I thought that's what I said but I'm going to repeat that because that is what I believe in terms of this licensing thing 105 million bucks is interesting because my assumption has always been that it's like a 12 to 15% you know kind of like you know rate so this kind of foots if if if they do billion or so a year maybe but in my estimation it seems a bit low for them from a revenue perspective deduction well you know what this

suggests exactly to your point Jen is I think that old word profitability comes back right is the Rev share a part of after expenses yes so does this tell us that scopely spent a lot on UA I don't know yeah contract Works differently and when you do a contract number one is obviously App Store fees come out of that and then there's typically something called deductions or net deductions which is every company can go in and negotiate what do you take out before you get to a net revenue number that you're royalty is calculated against and so in some cases marketing or UA can come out before that net revenue number so that it is a lower number that gets calculated against I don't know exactly how the Hasbro deal is set up I imagine you know they do say there's a monthly Revenue Decline and consistent marketing support you would think that a little bit of of marketing goes into reducing that net revenue number so it's a lower base for royalty Cal obviously this is pure profit for them and for asro this is a big [ __ ]

deal right because they're not a very profitable company relative to scope Le now obviously and some of the game companies right so $105 million of pure profit is amazing having said that this this deal was signed like what 10 years ago right so let's amortize that over like a 10year period like where they could have been making their own game in theory right over that period right and if if you yeah I mean if you compare the p&l of of making their own game and making a shot at it I don't know but your point last week was they could never make their own game like this well if they made the right investments in the right people they seem to be getting more and more aggressive right it's taken them forever to do this transition I mean it's always possible I guess but at the end of the day this is going to be the calculus that they're going through right with all these big guys that they're hiring and all these teams that they're building and like do they really want to give $3 billion dollar away to scopely with their IP that's the

calculus right and if they are a digital first company then it seems to be make sense that they should be building this stuff on their own yeah I I still think you should diversify and do a little bit of everything you should license some things you should build your own things and take your swings because as we all know you got to take your swings because no one ever like I told you I've made 10 or 20 versions of Monopoly in my lifetime making Monopoly games I think if you added up every single skew I worked on G wi it's like a tenth of what of this number right like they hit magic they you know they hit the gold mine and I don't think you can ever have predicted the success of this at any point in time I know I'm talking out of both sides of my a-hole right now I'm just what about this I I I want to be clear I know I am I am doing that what I'm saying though is that they are making huge investments in building up their Interactive Group this is the calculus that they're going to be going through in terms of at their other licenses and seeing what's out

there and seeing what they can build themselves and we'll see if they can actually make a go okay right another go Scrabble go Monopoly go that was a great pun that was a great well done yeah 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 Works 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 step into the future of game monetization with exola the premier partner for game developers seeking to

expand their reach in Revenue exola provides a robust Suite of tools designed to enhance user acquisition maned 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 success [Music] all right Zinga launched puzzle RPG Game of Thrones Legends with a kit Harrington who is Jon Snow trailer so definitely multiples of a budget lower than our friends at supercell starts very cheesy and ends with expected Game of Thrones Jon Snow jokes but who doesn't want to see Jon Snow back even as a sales guy for a puzzle RPG um I'm a huge house of the Dragon fan and a huge Game of Thrones fan I was really struck that

it's the entire universe of the show and that they were really leaning into house of the Dragon but then they got Jon Snow to be kind of the face of it in the trailer so from a branding standpoint I'm kind of confused to be honest with you I'm there with you like I went to go download this game and this is a great opportunity to talk about Game of Thrones but I went to go download this game and I had my my gen hat on and I knew I knew about this ad we had talked about it and they also remember they had a Jon Snow prequel that was a roomate for a long time which just got asked but when I went to go to the App Store and download this game I expected to see kit Harrington on that app icon and instead I did not I saw a character from House of the dragons and the other thing that I saw is this Game of Thrones icon text and so you know there's this really weird branding issue I'd love to learn more about where you've got a song of Fire on Ice which is the book series you have Game of Thrones which is what HBO decided to title the series and you have House of dragons which is its own title as well it is not have you know Game of Thrones colon a house of dragons or A

Song of Fire and Ice colon a house of dragon and so it feels like it's kind of this branding [ __ ] up and I know we worked at scopely where we had to deal with a lot of these weird licensing things on The Walking Dead too or or different permutations if you actually look at the timelines between House of dragon Game of Thrones it's like multiple Generations different so it's they same universe but it's not like it's back to back it's like the the prequels If You're a Star Wars yeah like well it's like acolyte it would be the best Star Wars analogy so I have to imagine that this game has been in development for a long time and I think they should have known that house of the Dragon has been doing really well I may have recommended a pivot and how you looked at The Branding for this and I have to imagine that the team tested this right they had to have tested with App Store copy with app icons you know young rera doesn't land on the icon if young rira doesn't test the highest versus a kit Harrington and

they probably had already locked them in and they probably got you know too far down the path of all of those different things but I think it's a missed opportunity to not tie everything together to lean into the newest branding so I I don't know I'm I'm confused I would love to talk to the brand person at Zinga and be like tell me the story of why you landed here and why you're keeping it this way and they're probably going to tell me but Jen that's how it tests in the App Store so that's what we do but I'm like it doesn't make sense and so that's sometimes where data and Science and your gut and and consumer perception sometimes those you have to like equate those two and you can't always go with science what makes sense do you think HBO if we go all the way up the stack do you think HBO [ __ ] up and how they managed A Song of Fire and Ice House of dragon and Game of Thrones branding you know like maybe it could have been like a Game of Thrones story if you're in the universe you know but it is very difficult to attract new players when you aren't clear about the branding that's why remember when when

Star Wars had the shitty like Han Solo movie it was like a Star Wars story Han Solo or Solo or something like that that way that you know if you're new you know what Universe you're coming into the challenge here is that yeah they did not kind of link it all together the other challenge is remember that Game of Thrones ended really poorly and true which is weird for them to then brand it Game of Thrones and there are already three other game of thrones games that are out there that you have to compete with in terms of you know search so I don't know why wouldn't I why wouldn't you be House of the Dragon then and so if we look at the entire game of thrones portfolio I've I've always been angry at HBO for not getting this into games earlier and sooner they had a bunch of weird propositions there was a Telltale Game I don't know if you remember that behavioral interactive did like a really bizarre RPG and that was all I had heard of but there has been a Game of Thrones Forex game called Game of Thrones

Conquest which is yeah it's been out for a while it's been out since before 2018 it was I think during season one or two of the show and when you look at lifetime revenue for that game that game is actually approaching 800 million in lifetime Revenue which blew my mind that this Forex game is doing this well I had no idea it had reached these Heights no it crushes it and by the way let me also just from a marketing standpoint as again as somebody who watches the show they now put before the show airs a QR code I think it's Conquest actually they do a really poor job of saying which of these three games it is but they put a QR code up and they say you know unlock a free character for HBO fans or something like that and at the end they also do a whole little trailer of the show of you know train your own dragons become your own destiny they put the QR code up I think there's a real opportunity for HBO to look at what I call lower third and so we did this on WWE where you can still see like

something going on with the show but in the lower third of your screen you you have a persistant QR code a little call out to what the game is the game name and the benefit that you're getting and then the consumer can still kind of see other things going on because right now I'm worried that people are just like fast forwarding through this but if you stick that on like over the top of maybe the recap or something else I think you could really drive more installs here's the thing Jen that I thought was super interesting when you look at downloads for the forx game it had one of its biggest spikes really since its launch When the Game of Thrones TV show ended What suggests to me is like fans get done with the show they're super hungry for Game of Thrones they'll consume anything that they can get drunk off in their immediate vicinity and we were dunking on Netflix games for a while but one of the things that their head of external games mentioned in a prior interview was this idea that they might put a QR code at the end of a TV series that could link you out to the App Store game this to me seems to completely resonate with at least what we're seeing here this feels like a good acquisition

strategy just love them to do it oh yeah I mean like that isn't a new idea like I did that on WWE in 2016 where we did like an animated version of like one of the WWE Superstars and a bumper and then we would put up the QR code and we could actually you know back at scopely we could look at minute-by-minute downloads and I could tell you the lift that I would get every time during a WWE show when I when those promos would go up with the QR code I was able to see the lift and then do an attribution to that cuz I know you love that Phil and I could tell you the ROI every time I paid for one of those spots during a WWE show so I know that these things work especially with the hardcore fan especially we did a version too where we put a code and I was like enter code you know heel turn and you unlock you know like a a character and the code Redemption I got on those things was amazing and so there there's so much that Netflix or game of or HBO can do that I just don't think that they are

doing because they don't have different teams the problem is you have these different teams who you know the game team and the licensing people have to go to the show people and the show people are like why would I do that let me break this down for you guys quickly this is like a very simple simple thing that you guys are making way too complicated this is a piece of [ __ ] game with a piece of [ __ ] engine that is like super old school game right they've had this license Forever at Zinga they probably just throwing this game out there because they're not supporting this thing at all it's not doing well it's like it's just it's just a complete throwaway thing right they probably had the old license with the old characters they don't have anything to do with the new characters it's probably a separate license no they're in there this is what they have the new characters are in the game when you watch the trailer like they are all there I don't know I'm looking at this game it's a [ __ ] piece of [ __ ] bottom of the barrel this is the [ __ ] we were making 10 years ago why didn't they give it to Legendary or excuse me why didn't they give it The Finnish Empires and puzzles people oh

small Giant games licensing people are [ __ ] [ __ ] okay they've licensed it to anybody right anybody that's paying the mg they're going to license it to they don't give a Fu but they're under the Zinger roof competitive G so I mean that's a whole other topic Zinga has three puzzle RPGs at the company forget about this is a throw [ __ ] dudus is on Peak this is a throwaway game 100% all right what else we got there's my hot take uh hot take did you want to do stormgate another thing that I think we've all been dying to see how it performs since there's been a large media tour is stormgate which is the RTS out of frost giant which is a bunch of EX blizzard devs led by CEO Tim Morton who was on Starcraft it is the last Dying Light of the RTS drowner rest in peace company Heroes 3 right now the game is in an early access launch the freeo playay unlocking will happen on August 13th so right now I believe you are kickstar backer or you an early investor remember they did that

really weird direct to Consumer investment I believe that you can get a key and you get access to this right now or you can buy some dlc's right now which will also get you access to the game and I think will also carry forward Eric I know you've had a number of predictions about this game or genre would you like to share them you know as much as I love Tim I I think he is amazing guy and I do believe in his passion for this genre because it is kind of the OG genres like back in the day when I was at EA we acquired Westwood that did Command and Conquer it doesn't look like this game is going to do it it just doesn't I like the reviews are really really really really mixed for a very dedicated core audience which is always a bad sign right I'm not really seeing any buzz and maybe they're gonna do this into the next two weeks when it when it actually Launches on August 13 I think honestly if they may have been a better bet to hire a publisher that could get the first version of this thing out and

and sacrifice some of the margin and some of the model for that and it because it looks like fundamentally they needed more time the game is not even close to complete according to all the reviews by the hardcore that have been involved obviously it's still an early access but two weeks is not enough to really finish it up or maybe it continues to be an early access forever I don't know but I don't know if many folks are going to stick around for this I mean this that's my hot take will they sell like a million or so units maybe that sounds about right at like $30 ASP so they'll make some of their money back and and we'll see but it just doesn't look like the game is robust enough to keep players engaged and and keep these type of like hardcore customers happy but that's kind of my hot take oh interesting I know that they're trying to go at publishing themselves and so it was interesting that you think they should have sacrificed the market for that okay mihoyo just coming off zzz

which I think we will have a look at next week it's actually dropped off in terms of downloads quite a bit I think there's some interesting stuff going on there they actually have just received approval to launch a new game and I'm not even going to try to pronounce it in Chinese it roughly translates to Star Valley in English it's going to be on both mobile and PC and from what we've read so far it looks like it could be a life Sim RPG think something like stardo Valley May Animal Crossing I'm totally in love with this idea I'm so happy to see this people have been asking for like a live service version of these games forever executing it at Miho Yo's scale and going a little bit further in terms of genre from where they've been previously I mean this this looks like a slam dunk yeah I heard about this on another podcast actually people don't know exactly what it is but they were you know wondering because of the name the way the name translates that it would kind of be you know stardew Valley meets Animal Crossing yes agree that if

something like this were to come out with the live service model that they typically do I think that it would really crush it I think the challenge is how do you add their gotcha mechanics to that kind of game play as Crest always says you know the way you make money in Mobile is with gacha and and pay for progression and and quote predatory monetization so how do you do that in that type of genre you can make it happen right I you know if I'm thinking back to Animal Crossing there was there was this whole like Underground Market of how we actually traded cosmetic items there were two really big ways for games like Animal Crossing it's how you decorate because it's this cozy game you're decorating and then any type of Avatar related stuff and then you have some of your re your special very hard to get resources that then contribute to how you make more cool items and build more cool stuff so if there's a company I think that could figure out how to do it I think Miho is going to kill it with

this that's my early two cents seeing nothing but just on quality of zzz their ability to make games how fast they can move how much they adapt to the market I'm very bullish on this game Cool all right okay investments in m&a okay Sega Samy is acquiring Dutch online gambling company stake Logic for about €1 130 million euros it's going to expand into the US sports betting and igaming Market Sega Samy we know owns the we know them for Sonic the Hedgehog but they also have land-based casino games like slots and Pachinko and stake logic who they just acquired they're looking to basically expand so that they can offer live table games and hybrid games which allows players to play roulette Blackjack backarat and live game shows online so from gev there was a interesting film chuck to the sin looking at what are VC's interested in content or Tech so this is

how I distilled this VC's generally right now investing more in content over Tech unless you slice it by Gaming focused VCS who are looking more at platforms and Tech over content so I read this as like platforms and Tech just literally technology what if you're going to build out some sort of online platform versus content more like games games themselves tell me if my read was incorrect no that's right go cool and then while mobile deals still kind of match PC console and Tech the amount of money for mobile is only 20% so there's a couple of other takes on this there's a bit of increase as you can see in the graphs so there's a little bit more money going out a little bit more deals going out but the split and Dynamics are changing a little bit ER I don't understand this I don't understand this why would you invest in content we just talked about Frost giant I just don't understand where the VC style returns are for Content like even RI it was not sold on being a content provider they

were sold on distribution like I where is the VC style returns that come with content I'm confused by that yeah don't get me started I mean are you kidding me are you're just trying to trigger me here right I I'm hearing by the way I'm hearing that believer is out there trying to raise more [ __ ] money dude dude light speed told me dude he said specifically that they were going to be able to get a game out by that with their first like 30 $50 million right and they're out there raising again and they're not even there's not even a [ __ ] prototype you know don't get me started on this I think if they announce a new round of financing I am going to go [ __ ] ballistic and we will talk through all this [ __ ] that's going on and why these things make no [ __ ] sense and you know million-dollar salaries and [ __ ] right like all this stuff so yes no content I think is going to be a tough investment for VCS BCS are really really struggling out there it's not a good environment right now I don't know I mean there's one thing I learned from the Mitch lasy School of gamecraft

podcast season 1 was your Returns come more from platform and distribution disruption than from content like that if I had to summarize one of my biggest takeaways from that you know what I think was like a very genius career that was it and so chis I I think I agree with you and I know a lot of those believer folks are ex- Riot I can't wait for your rant on if they are raising more money that is it just you know it's just folks who come from the bigger companies you know I think the number one challenge is just because you come from a bigger company it doesn't mean you're going to be successful at a startup because you don't know how to make the transition to working Scrappy and with no money and with pressure and you know you raise 3040 million and you know like does that really light a fire under your ass I guess the answer in this case is no I also think it's a we were talking earlier about howb just making games themselves it's hard making a game today

is hard I I'll talk a little about monster hun Hunter puzzles but like that game is massive it has everything you'd think you'd want to see but the execution is not quite there and if you're going to if you're looking to build out a mobile game and say hey this game's going to be a hit I would be super skeptical yeah two all right another exciting announcement look North World studio and publisher dedicated to Creator platforms has raised 4. 5 million in seed funding Mishka just had a great podcast with their founder Alexon who was who was also the founder of Bungie they've developed and published five games on ufn for fortnite and they've also interestingly done premium mods for Arc survival ascended which I'm kind of confused by but I think their thesis is becoming a lot more clear they've talked about being a publisher their deck by the way is also online you go to Business Insider you can see the pitch deck which they raise money on which it was was really awesome to see I'm still unconvinced that any of this makes sense for exactly the reasons Eric just pointed out like what is the height of this you know adopt me which is like the top of the market for Roblox

maybe does 80 million a year being generous and that's on the biggest platform this is the best you can do the economics are very tough I think to get right but they're doing interesting stuff I think Alex is a brilliant human being he also has his own podcast called the fourth curtain which is which is a blast to listen to but curious to see how it goes yeah I met him at lvp he's he's a really interesting really smart guy and very he's got he's got a lot of energy let's say but the the fact is that ufn model is kind of broken if they don't allow for monetization Design Within games so if it's all cosmetic economies like I don't know how he's going to scale the this type of business so that has to change yeah the two other challenges I think I heard were like there's lack of Save State and that there it the marketing it's like almost impossible there's no deep linking so you can't go out and market like hey come play my creative world with this deep link and I and I think those are two things it sounds like Alex has direct access to Tim in some gream room

of some conference he was like went up to Tim and was like please give me deep linking and these things and I I hear they're working on it but from that podcast that Mishka did with them but anyway you're right unless they start solving those problems for that platform it become I don't know why you know folks are just playing and dabbling which is great you need to like kind of dabble and innovate but it's not paying off right now all right what else basic the way to get deep links and cyber trucks it's it's never the actual business meeting it's the meeting in the back room where you're like you know elbow nudging buddies buddy trading can I get deep links can I get a cyber truck all right we're gonna do this quickly so a number of game divisions inside Microsoft are unionizing including Bethesda zenmax the 300 QA workers Activision Central UA another 600 QA workers blizzard the whole org evidently 500 workers behind World of Warcraft are unionizing

so fascinating new thing going on now that blizzard is part of Activision and that's it that's all I got I don't even know how this is going to impact the business to be honest it's interesting the QA workers are are the one thing that are come and go based upon need and it's just interesting that that would be the place that they would unionize I guess that makes sense though but whatever I don't know yeah I think it makes sense because they're often tossed aside and they feel like they aren't kind of respected as a group and and how do they have job security might be I don't know enough about labor laws in in unions to comment but it is a trend that we're seeing and mainly we're seeing an inside of Microsoft which is like the most interesting thing so it's also like what does that say about how they are treated there but but that's part of the agreement that they had with the CWA when they went forward with the Activision sale is that there were certain agreements that they would have to abide by in terms of how they handled and respect unions so I think part of this is you're seeing it specifically at

Microsoft for some of those reasons but I completely agree with you Jen like this game makers Guild included non QA functions the fact it was almost not it was almost exclusively non QA functions we're talking about design we're talking about art we're talking about production you know I I have so many questions about this legally what what if you're a remote worker you know what if you're in England you know what what does it mean what are they actually going to bargain for what's their leverage I mean you know they're in California so I think there's enough here to to actually get someone on a podcast and talk about okay what is unionization mean in Sweden it doesn't mean what people think it means but I think in California be interesting to talk about it as well yeah 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 hands faster and grow your community heroic Labs is a battle tested partner and friend of the podcast their Tech enables you to be

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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 our good friend Mr Neil long at mobile gamer. Biz wrote another hit piece on Apple and apple arcade and I and I can't stop I can't help myself where because he brought in Vision Pro part of it too which I think is awesome right so the thing is it's the same report as their inside Apple arcade report and uh and it's just kind of interviewing new people saying kind of the same [ __ ] right so some studios now wait up to six months to get paid which it almost puts these indie games out of business Apple AR team doesn't respond to routine emails for weeks or even months if they respond at all one developer had semi-regular meetings with a Tech Giant and half the Apple team wouldn't show up Apple's Tech support is also described as miserable and the worst I've seen anywhere Vision Pro

struggles to run complex games and to developing for it is like going back in time 10 years due lack of tech support apple Engineers are unable to offer any insights into how Vision Pro's hardware and software works or how essential middleware is meant to work with it discoverability on Arcade is so poor how poor is it that one person said it was like their game was in a morg working with apple is like being in an abusive relationship said another and my favorite quote of all is it's like an abusive relationship where the abuse stays in the relationship hoping the other partner will change and become the one person you know that they could be you never date on potential dud keep fighting the good fight Neal keep fighting the good fight apple is a [ __ ] [ __ ] show absolute [ __ ] show on a regular what El what do they do well I mean the consumer [ __ ] they do well they are just like the

worst [ __ ] partner known to man you know and this is just the tip of the [ __ ] Iceberg with this [ __ ] anyway I love it love it any chance I get to badmouth Apple my by the way I'm going to buy like a $3,000 laptop tomorrow for my son you know so I guess you know I'm I'm not I'm not voting with my my money that's for sure all right moving on all right Neil thank you for the greatest collection of quotes and and humor and smiles that gave us that great podcast segment Neil you're the best pH Garden Joy scop pleas take on design home or we consider reada aore globally launched last week going in and out of soft launch on iOS Android since mid 2022 I've been following this one for a little while Laura you picked this up though this was one of the studios that they invested in out in California which has been sitting around for a while what's going on here okay okay so I picked it up I had a look and I was like oh is this going to be another redor

clone probably just like same thing and it's actually not if I looked at the first I took a look at the market if I look at like this type of SE like these types of games if you exclude the games that include like a puzzle element like a match three decorator like your homescapes you take out children's games there's not many games that are this style of make yourself feel like you are an interior designer going back to the animal Crossing reference you could do things in Animal Crossing like if you wanted to make an outfit you could actually create different patterns to look like a texture or specific design I'd say that feeling of you get to kind of customize to a higher degree is what these games like redcor design home and now Garden Joy are doing so what you're targeting is this what I what I describe is a very highly engaged Market that loves this that loves this level of kind of ability to customize eyes and I've seen in the past kind of super high retention numbers for the style of games

with smallish Dow especially in the early days I had took a look sensor Tower shows kind of an uptick so it's like okay Garden Joy just came out it's not just a clone of red deor it has a better ux it's easier to use how is it doing so this is how I would describe it there's an uptick in active users so that means they're bringing in I'd say more players but the monetization doesn't follow so if we look at the chart we see that daily active users Garden Joy bringing them in but it's not elevating kind of the whole segment which means that in how I read this is Garden Joy taking players and then also taking probably the payers from the other two games so still early still early just to give some context on how much these games make Garden joy since 2022 has made about 7 million to date Home Design just over 600 million since 2017 and red deor has made about 200 million since

2019 I like these games the only question is is it really a game I feel like it Treads the line between what are the rules then of what you define as a game versus not it's not like there's puzzles there are kind of levels but you're designing something you're submitting it you're voting and then you're you're getting ranked and then you're kind of your progression is through your rank that's where that I would say I think Garden Joy also adds kind of some other elements to it there's AOW grow mechanic where you can grow different flowers and trees I'm still early but I'm hopeful for this game I think it's very interesting um but it's still early yeah this genre sucks I'm really sad about this like this everyone thought this was going to be big with design home right because not only do you get the I AP angle but you also get the down funnel conversion potentially to Real World products like that was always in a slide you could put in there is we're going to have click through to real sofas we're going to have click through to all these things brand sponsorships I mean it sounds really great but they haven't been able to stack multiple games in this genre and when we looked at the downloads it was even worse when you look at design home

versus reor because as soon as reor launched it looks like a lot of its growth was at the expense of design Helm so it's not growing the pie like if we look at match three that is a pie that's grown almost exponentially everyone looks like they're in a better place now than they were a long time ago but this has not been a genre that's been able to grow and there's been Studios like Robin games I don't know if you remember them they were at a JM City there are a bunch of xjam City people down the street from scopely there's been dressed which is in London which actually has a fashion basis that hasn't been able to go anywhere and I I think there's like two or three other ones that were VC back that just hav been able to get apps out the door that have traction there's another one called venue where I'm putting all my money literally I'm an investor that I'm very excited about so let's see how that one performs it's in soft launch right now but yeah I'm just I'm really I'm I'm bummed this genre didn't take off I really thought someone had found a market segment here it's really Niche and it's it's hard I don't know how this is this is the difference between the two games I would say it is so hard once you get into the finer details of am I changing this color of this one panel versus just changing a

color of a larger segment once you kind of get into this sofa fabric is sponsored by this person how do you scroll through all of these options it becomes totally overwhelming to choose that is I think something they're going to have to balance with how what are you bringing in versus not and the same with the fashion games so okay yeah all right what's next there's an upcoming game called Date everything published by Team 17 they made overcooked it's a Sandbox Dating Game set in a house and allows players to date anthropomorphized versions of a washing machine a vacuum cleaner a smoke alarm and about a hundred other things I strongly recommend you you watch the trailer did you just make this an x-rated podcast what what excuse me do I need to put the content alert on this love this this is great this is great this is the simulator this is the simulator genre on Steam for women you're going to you're going to get all these obscure dating games there's High

you boyfriend if you remember that it was a a pigeon Dating Game you had uh one based on dead by daylight Buckle in this is coming Jen watch the trailer it's it's not it it's interesting Jesus Christ EV help us oh I okay another exciting day Disney speed storm is global baby this is the cart racer from Gameloft which was on switch which was doing gang Buster download numbers it looks like it has immediately died on mobile rest in peace Laura would you like to cover Monster Hunter puzzles yes all right so Monster Hunter puzzles has been out for a month it was live as the end of June so it's from Capcom and it's a little hard to describe it's match three meets renovation plus Cosmetics plus light resource collection and pseudo battles and then in the engine itself they almost take inspiration from Royal match from homescapes from Harry Potter it has the makings of a good game but in terms of execution it's falling a bit short so

looking at the the chart here I mean but I think to no one's surprised Japan's performing the best in terms of Revenue us is at second place it's like generally like 30k per day I AP they also have light ads if it's a stays like maybe like8 to 10 million of dollar 8 to 10 million doll year game it for this type of genre on this size I think it's quite small there's one bit that they did add so when I worked on Match Upon a Time which was a a game we launched they had something called time freeze and they did take that mechanic is in which is which is I thought very interesting use board freezes you have 15 seconds or so to make matches every board holds in place and then it falls so they're experimenting with engine and Cascades which I think is an important trend for this genre but what they also had the battles they feel kind of meaningless that when you make matches and you're fighting a monster like kind of the monsters from the Monster Hunter IP it don't affect the monster it looks like it's calculated as a percent of

goals achieved but the monster affects the board it's this whole weird setup you know I I I love what they're trying to do and honestly I'd love to work on this game and kind of make some adjustments to it to make it feel a little bit more cohesive I think they should have looked at Royal Kingdom for how they did battles that would have been a better mashup anyone else this game's not doing crap even in Japan it's like a huge Miss oh I don't know it's small it needs work man it sucks when you have such a great IP like that and you just don't land the plane that's a big Miss like build a location game or something yeah wait there that game did really well that game actually doing okay right that is true actually doing well in Japan it's doing well yeah it is oh you make fun I just watched that trailer on the on date everything and I'm scarred you put these glasses on and the glasses like allow you to transform like the piano into a person and then they accuse you of

cheating on them with other pieces of furniture can I mean I guess I always ask for Innovative gameplay but maybe the Monster Hunter team needed to put those glasses on and point it at a puzzle game and find a better better puzzle game all right so we're at an hour um topics okay there was a report that came out last week in the Wall Street Journal about twitch and a lot of its troubles in recent times one of the Insiders in the report worries that it will potentially become a zombie brand and they pointed to other Amazon Brands like good reads and woot as examples of zombie Brands twitch co-founder and former CEO EMT sheer stepped down in March 2023 the platform announced plans to shut down at services in South Korea in December this thing was purchased 10 years ago in 2014 for billion and one of the big shocks at least in the report is that it's still not profitable and we

look at what's been happening to headcount at twitch and 2022 they had around 1,800 employees by 2023 this was down to, 1400 employees by 2024 this was around 900 employees and if we do a quick look on where they are in terms of platform Health metrics if we look at average concurrent viewers it looks like it is a decline since 2021 where they had 2.78 million concurrent users in 2024 so far they have 2.41 million concurrent users so the trend line doesn't look great it looks like growth has stalled and if we compare them to the three biggest platforms you've got YouTube at number one of course when it comes to live streaming twitch is number two and then there's been some conversation about kick which is still far far behind where twitch is right now but used to be actually be a crypto platform Eric let us know let us know how it is okay I'm gonna have to cave out this a little bit because my information is very very old on Twitch but we had I had tons of friends from EA

that worked at twitch over the years and fund milia this company was never profitable like they're burning [ __ ] money right and so the goal for Amazon was to acquire Twitch in order to get access to this audience so that they could convert them to Prime and for that purpose it might have actually worked like I because I think they did really well with twitch Prime during its Heyday right when they were first starting from that so from that particular metric it was fine whether it was profitable no it has never been profitable even with Amazon's you know services that they provided which is Cost Plus which is Cost Plus I think people should realize it's not free it's Cost Plus a but even if you were to deduct those costs Al together I think it still was unprofitable right because they never found a business model that made sense you know they never embraced advertising they were absolutely 100% resistance to advertising which is the only model that makes sense for this type of business in my humble opinion but in actual all though the data was not that bad like

they've maintained an audience like they're still a very popular platform they just cannot figure out how to monetize or unwilling to do what it takes in order to monetize that audience and that's part of my biggest issue with Discord right is that they're going down the same path where they have this huge captured audience but they AR monetizing them for [ __ ] so it's like the network costs are more money than they're generating so anyway it's just interesting that these big big social platforms can grow and create these huge huge groups of people that are super dedicated and and super valuable from a demo perspective and yet they still can't monetize it's like a mindblowing to me I mean from a marketing perspective this is an invaluable Channel when I was at Riot we did a lot of kind of data mining to understand the correlation between twitch streamers and how your business was doing and Phil you would love this there was actually a correlation between the number of unique twitch streamers and the success of how

we were doing in terms of Engagement and monetization so as you were going you could like you know the more people that were following and streaming your game the better you were doing uh we don't know that's how the causal Arrow points if go the other direction I would say data nerds at R there's also why there's X causes y y causes X and then there's Z okay well I my God stop I the data nerds at Riot were able to at least say with a lot of certainty that that was the case and that was a few years ago but I can't you know I would imagine that it's something similar so from a value to the industry and a value to games this platform is immensely important however as a business which is your point it you know it continues to struggle they keep trying to figure out different subscriptions or different ways to monetize you know the challenge too is the ad business you know from a UA perspective and a performance marketing and even a brand marketing perspective I would I had to have to shy away from

them they were so expensive and that the incrementality Phil you would love this it just wasn't there because your players are kind of already there and if you're watching a stream for one game the chance of you seeing an ad and going and playing another game was actually not that high because you were very very very dedicated to that one thing they just can't figure out how to make money which sucks because we need them we need i i as a marketer I need this platform for I worked at Amazon and it's very interesting to see how they treated twitch and just how they think about business in general so twitch gets its own offices its own branded offices they get their own email addresses they definitely have their own identity inside of Amazon one of their strongest I would say you know Aqua deals that that has an identity inside of Amazon but I think the other thing to keep in mind is that Amazon is extremely patient with their businesses and when you talk about losing potentially a billion dollars a year it's nothing it's absolutely nothing to lose a billion dollars a year I mean this is why Amazon gam studos his Survivor for so long is because when you look at it in the p&l it's just such a small part of it so you

got to remember that Amazon [ __ ] out an advertising business on their core platform that does $40 billion do a year in the course of like two years they just [ __ ] this out and so doing 40 billion and it's it's so much of that is margin when you look at something like that it can subsidize so many of these other bets and so a billion dollars a year to have a bet like this is nothing for Amazon and they'll be extremely patient and patient and patient and patient sometimes I think they're actually too patient and that can cause a lot of problems but by and large they're willing to absor these losses without even blinking an eye I think this will survive for a long time I think I mean you just show you just showed that headcount cut that every year they keep whacking at it and so how do you I mean are you really betting on it if you keep giving them a skeleton crew I'm not sure more employees makes things better you know I'm skeptical of that relationship I think Elon Musk has proved quite a bit in terms of how you run Twitter do I really need as much headcount as I thought I did beforehand why do I need 2,000 employees on Twitch is that really making the the platform better or is it just making a cruise ship that's harder

to turn into profitability all right we're going to wrap it up for this week thanks everyone and see you next week 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 fund 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