TWIG #344 AppLovin’s Record Quarter, Moon Active’s New Games and Battlefield’s Big Comeback,

Will this time be different? Or is basically EA like Lucy, you know, pulling the football away right when right when Charlie Brown's about ready to kick it? [Music] Stay ahead of the competition with Sensor Tower, the trusted source for mobile marketing intelligence. Whether you're tracking trends, benchmarking performance, or scouting the next big hit, Sensor Tower delivers the data that drives strategy. Dominate the charts with Sensor Tower.
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engaging games? Check out Hero today at heroiclabs.com. [Music] Hello and welcome to this week in games 344. I'm Jen Dano. I do marketing things on the podcast. Today we have
Eric Crest, strategy and investing.
Phil Jesus Christ, dude.
Oh man. Oh,
he needs a special introduction. He need He needs a [ __ ] Phil. I know. Who needs a script?
This is a scripted podcast.
I've been an actor on the show a long time, you know. Get you something in the chair. Phil Black, monization. Oh,
Mishka, founder whisperer. All right, we have a lot on the list today. So, 10 cents Horizon knockoff. I don't even know how to say the light of Mori more, whatever that name of that game is. They've done some updates to its Steam page to be less of a knockoff, but actually, wait till you see what

Moon Active, they're picking right up right where Tencent left off with direct inspiration. So, they have three new games in early stages. They're taking on Monopoly Go, Whole IO, and Zen Match. There's a new new zoo report, say that three times fast, on regional revenue, players, and payers. Apploven is still on fire as they announced their Q2 earnings. Ad revenue is up 77%. Dual Lingo buys a game studio. It's another excuse for us to talk about Supercell. Thank you, Mishka. Play Tikica bumps up their DTC revshare target to 40% even though they're only reporting 25% right now. Nintendo launches My Mario product for babies and toddlers and I absolutely hate it. I think I'm going to disagree with most people, but I have a reason why. And our big topic today is Battlefield 6, which is putting up great numbers, great buzz, lots to go over there. But first,
go Sweden.
Go Sweden.

It's not made by DICE anymore. That's why it's successful.
Rise from Midsummer. Oh. Oh.
Anyway, I am out for the next two weeks. Maybe only one. We'll see. But I'm headed to Philadelphia to take my daughter to college, which I have to admit is hitting me hard these days. Something about daughters, maybe. I don't know. But I am I mean, I think she's been ready since she was [ __ ] 11. And she has not been the easiest child by an absolute long shot. But it is going to be weird not having her around. And so again, it gets me thinking about things in general. And I this is my like fourth midlife crisis. I think I've had more than most, but these are all very typical. This I'm not unique in this thing at all. Right? My first was when I was at Kabam and I was like in my mid40s and it was the classic. It's like what the [ __ ] I'm spending all this money on private education. What about me? And so like the like the douche that I am, I went out and bought a Porsche, right? And just drove around like a douche, you

know that? So very classic, right? The second was my uh second year at Gossamer where I had that classic feeling of imposttor syndrome, you know, what is my value, etc., etc., etc. And frankly, the podcast kind of helped me get out of that kind of rut, you know, like it gave me something else to do and I kind of move forward with other things, fix that thing, right? The third was a huge one, 49, right? Probably the hardest one to date was some family health scares and I just had to get my fat ass back into the gym and get in shape because I got freaked out about dying. You know that that sort of thing. Very typical. But I think this one's the hardest in the rest. And I think I know why. It's very existential, right? Like this feeling of completion of some sort. Something is actually coming to an end. And really it's not clear what's next when my daughter leaves. And again, something that's not fixable on my end. It's just basically a transition, right? And I know I have another kid, you know, he's got three more years. I'm not ignoring that, but he will be gone in three

years. And anyway, the whole thing's been very unsettling. And hopefully get some closure next week when I drop her off, but I think it's going to be a tough tough road ahead in in this this transition. And hopefully my son will pick up the slack a little bit, but we'll see.
Oh, thank you for sharing. This is like it's like a TV show here. I I love that our resident podcast villain has a heart. I always tell people that like you you are caring and loving and all of these great things, but no one ever believes me. So hopefully this will help them.
He breaks a character once out to other people that have gone through this, right? That have just transitioned out of this. This is not This is very typical. It's just Yeah. It's just odd. Yeah.
Yeah. It's the emptiness syndrome mental thing, I guess. I know Mishka's got a while before that happens to him.
I kind of wait for that to to get the, you know, the girls out, but maybe it's different. May, you know, I thought that Crest is doing the right thing is just fill the void with Porsches. Like I

thought that's the cure. I'm I'm looking up at him.
Fill my empty heart with a Porsche.
Yeah.
Yeah, that's that's what the empty garage are for. So, goodbye, honey.
That's pretty good.
Yeah. Well, off to the business. Let me show a couple of things. So, Gamescom last show heroic party is actually pretty crazy. We have over a thousand signups. There's 500 that we are approving. It's only 250. In short, come in early and you'll get a space. But, we'll have a sort of a revolving door type of a principle. So, even if you come in late, there might be a little line, but once people leave to other events or other dinners or whatnot, there will free up the spot. But, it is going to be awesome. We got arcade tables, pinball tables, rooftop bars, you name it. Whiskey tasting, same thing. We have around 350, 400 signups. We can only take 100, but rolling door. Actually, that one is a short event, so come in early. You'll get your spot. It's one of the best, if not the best, cocktail bar in Germany. And the back

patio is awesome. So, come in, sip some water or whiskey. And then final show on my part. Actually, this week, I forgot, we kicked off Deconstructor of Fun Talent. So this is an executive headhunting team that joined the constructor of fund. So like we've all gotten a lot of questions on do you know somebody from this can you recommend from that and that has been happening for years now and then I ended up meeting an executive head hunter and his team. So about four people joined in and so they are helping out. If you're looking for a leadership job, the constructor of font/talent. If you're looking for leaders who can build, operate, market, you name it, CTO's, again, the constructor of fond/talent. It's not me that's going to be looking for talent for you, but it taps to our network. So, don't worry, I'm not the executive head hunter. So, that's it.
I listened to the first 30 minutes of this, Mishka, and let me just say, this is one of the greatest product placements I've ever seen, this podcast. It is seamless. Like, you hammer the CTA. It's a thing in beauty. Like,

bravo. It was informative, too.
Listen, listen. Your boy does native marketing. That's the thing. No, to be honest. So, Mikush is the guy who's who's running the the thing. I met him through this and then I invited him on a podcast and we ended up talking. This is an older episode. I still have hair in that one. And then Summer came in and so we we decided to launch this thing together. So, again, if you contact me, I might do business with you even though it's the other way around. So
awesome. All right, so let's go to corrections. Phil,
I try every time to mention this. Sometimes I slip up, but when I present data, like when we were looking at Lilith data, when I pull from sensor tower, we know we don't have good Android China coverage there. And so it underounts that portion. Totally acknowledge that. Someone wrote in, I didn't mention it when we went over this analysis, but that is just generally understated when we do our analysis. That's just a limitation. But when you filter for iOS only, you can usually get pretty good trend analysis. And you know, sometimes there is

parallel trends, sometimes there isn't. But I do think it's it's meaningful to look at the iOS numbers for China, too.
I didn't realize this, but there is a like a Chinese sensor tower, so to speak. It can show you numbers from the biggest Android stores. They're like individual stores at like Huawei or something like that, but you have to have a Chinese phone number to get access. So, that might be something to look into. do this forever. I want I want Chinese distribution for things. They're like
there are a lot of things I'd love to play. Anyways,
all right. There you go. All right. So, let's show a little bit of the art for 10 cents correction. So, I guess this is a correction for Tencent. So, we did this maybe last week or two weeks ago that the light of how do you say this? Moa Motor Light of Motor.
All right. So, light of
Great name. Great name.
Yeah. rolls off your tongue.
Yeah. Public service announcement. If you can't say it, it should not be the name of your game because you cannot get

word of mouth. Anyway, so this game looked incredibly similar to Horizon. In fact, Sony was filed a lawsuit against Tencent on this game. The store page for the light of motor was quietly updated to be very very differentiated from the traditional assets. So Chris, I think you were right. You know, we were saying if Tencent didn't like preemptively make these changes, they would probably have been forced to, this is kind of them saying, "All right, I guess we should probably make a little bit of an effort here." Cool. Okay. Thoughts? Yeah.
No, I mean, yeah, I mean, this makes sense. This just eliminates the the drama potentially.
Yeah, it it's just like why not? Like,
and then later on some of the screenshots that Mishka has for the Moon Active games, that's like really really egregious. I'm like, "Oh, guys, you like
take anything that is not bolted to the floor. Just take it."
Good artist copy, great artist steal.
Oh,

yeah.
I guess
magnificent artist laminate. I don't know.
All right. So, let's move on to the new news report and it is called unlocked games revenue, player behavior and payment trends in the west. So they seem to cover spending on games across all platforms digital and physical including subscriptions like Xbox Game Pass. It does not include hardware. So just and it was also so mobile and console and PC. So the first slide is really showing that almost half of global spend is North America and Europe with only about 20% of the players. And so these are kind of things we know crest you often say let me just use US or tier one which is basically North American Europe as a proxy. So from a spend standpoint it's about half of the global spend across all platforms and mobile I think it's a little bit more. So then on the spend side of things the global games market

is going to hit 189 billion in 2025. So North America is about half of that what I just mentioned. So players on the second slide was 20%. What's crazy is North America is only about 7% of players just so small. Europe was 13%. And then the trends for this just showing that it's relatively flat. So what you have showing right now is that the North America spend per payer is number one and that's about two and a half times more than the second region which is Europe. So basically it says, you know, for North America about $325 uh annually per payer versus $125 per European payer. So remember that this is also revenue across all platforms. So just really interesting numbers. I think we all kind of intrinsically know this, but the trends look pretty flat in terms of the uh any growth in this though. I

keep reemphasizing this and every time I do any analysis or do any consulting around, you know, what's the TAM for games that are made in the west, it's like you basically take out half the business, right? Because Asia is irrelevant for most games that are built in the west. Like, you know, the mobile thing is like 95% of revenues in Asia is driven by Asian developers, right? So, that's not a market that's viable. And then you look at the US versus Europe. And as you can see from this kind of analysis is that it's basically primarily the US that's driving it. So if you build games for the US market, then Europe will likely follow, right? So you're basically looking at what's successful in US. And if you look at US specifically, it's much easier to get trends and to get viable genres and subg genres, etc. uh and it takes out all the noise of the rest of the world from a downloads perspective and other things. And so anyway, that's kind of the

typical way I look at the I've been looking at the market for decades.
Yeah. And this slide which shows growth almost flat for the US, a little bit of growth in Europe, it basically means that you've got to build a deeper monetization well to find more revenue because the amount or the number of payers isn't necessarily growing. That's why we're seeing, I think, all of these, we talk about all the time, these like really deep hybrid casual games that are easy to pick up and play with, but deep monetization.
Yeah. And this number seems overstated though, 277. I mean, what's the population of the US?
But Europe is the bigger one here, right?
Yeah. This is the only graph where Europe is bigger and growing faster than the US, I believe.
Yep.
That's interesting.
Go Europe.
All right. That makes sense.
Yeah. No, this is just because poorer regions tend to grow faster.
No, but the the overall market size is like double.
Oh,
I see what you mean. The absolute

numbers here in terms of payers.
That's also why revenue per user is so low in Europe, right? Is because you have a lot of like these guys ily lose. What the [ __ ] are these guys spending on if it's if it's the revenue so low?
They divide up Western Europe and Eastern Europe. And you can see like Eastern Europe is like dragging down the ARPO quite a bit. But even if you cut away Eastern Europe, Western Europe is still only 170. per spender per pair.
This is exactly what we saw in the Roblox numbers, by the way. Remember we were looking at the quarterly earnings time, average daily bookings per DAOU. We could look at the United States. I think there was 4x as valuable. So, this actually lines up, which gives me some confidence, right? If we're seeing these kind of multiples between regions. Yeah, this all intuitively makes sense, right? And you know, back to sorry, back to the regional thing. If you don't take out Asia, then you start making [ __ ] MOBAs, right? That that's what happens, right? you make MOBAs and it's like then you fail over and over again, right?
No, I don't think they needed that, Eric, to make MOBAs.
Focus on the US for [ __ ] sake. That's all I'm saying.
They did have a chart in here that was genres by region.

All right. So, this slide which was pretty small. Just was showing the difference between I think it was what like worldwide, Europe, and
it's basically the same in a different order.
Yeah. So, we making shooters. Eric, is this what you want me to do? Because this is what I take away from your advice. North America number one shooters. All right, let's go make Splitgate 3, baby. You know, giddy, giddy up.
Make shooters great again.
Let's go.
Let's go, baby.
This is PC, console, and mobile. And so, remember, you're getting all games and so you're going to get the Black Hole games, you know, in this list. So in the US, you're getting COD, you're getting Fortnite, you're getting, you know, those games at the top of the list which never ever move.
The other thing I would say about this is they should really really not conflate PC and mobile. Like
it's such a completely different market like
No, no, you're wrong about that. I I think we should absolutely have a holistic picture of what gaming means.

I mean, don't me wrong, the breakdowns are useful, but like understanding a composite I think is very fruitful.
Okay. Okay, fine. But we should definitely be distinguishing what the difference is between mobile and console.
What's an adventure game?
Like Last of Us.
Yeah,
Last of Us, Assassin's Creed.
So, anything single player is adventure.
Yeah, actually more or less. I mean, role playing the summer singles, but
yeah.
Okay, moving on.
Moving on. All right, just really quick, AppLin had their Q2 earnings and they continue to crush it. Mr. Seaffort
Jesus
from mobile dev memo has this lovely chart that shows their growth and their revenue.
Oh my god.
77%.
Yes. So their their advertising platform it was formerly called software platform. It's 77% growth to 1.26 billion and then their net income also grew by 156% to 772 million. This is all due to improved technology, increased demand, as well as

the supply side expansion, basically the high market penetration of Max, which is Apploven's SSP. So, they they're just on fire and crushing it. I think their guidance was pretty good as well. So, good job, guys.
Have you ever seen numbers like this, Eric? Like, is this is this like Google like early Google numbers? 70 to 77% quarter over-arter revenue growth consistently. That's crazy.
Yeah, they they executed flawlessly, man. These guys are ruthless, dude.
I know, right?
Actually, depending on who you talk to, but they're getting into e-commerce and that's helping driving new customers to their ecosystem.
Why don't I hear them mentioned like in the context of like Meta quarterly earnings or Google quarterly earnings? It feels like they're never mentioned as like a threat.
They're starting to be a threat by going into e-commerce, right? And so that actually puts them on the map. And honestly, like if I were to be concerned about app loving, it's the fact that

Facebook in particular is really going after them with fingerprinting and
getting more accurate app post IDFA. And then Google is coming down with their changes which may give them well most likely will give Google an advantage because it's Google, right? But on iOS like you know Facebook is still a direct competitor, but Facebook lost their [ __ ] ass during IDFA, right?
Yeah. this transition from IDFA and Apple haven't picked up all the slack, right? So, Facebook's not going to take that sitting down. They're going to come back, you know? And now that Apple's kind of like completely ignoring the privacy issue, right? Like it's all bets are off. Like, anybody can win in this market because Apple's a piece of [ __ ] you know? They just completely abandoned their whole [ __ ] reason that IDFA existed to begin with, right? It's so crazy like how this works out. But anyway, they're the big winner. Those guys are ruthless like you know [ __ ] KKR like badass [ __ ] these guys and so there we go.
Yeah. So apart from just dropping by a thousand in Apple podcast listing, we

feel regarding like do Apple do Meta and Google and those others care like for at least over a year now by going to these events like you know the senior people at Google or Meta would take you aside and be like what do you think what do you think Apploven is really doing? I'm like I don't know they can call me but that has been a question for at least two years now kind of like whispered. Yeah, I mean look, app is running without any restriction, right? You know, like Google and Facebook have to abide by lots of rules and they're also have all these government agencies on their [ __ ] ass, right? You know, like everyone is watching them like meticulously. App is running without any type of controls or hindrances at all. And so that creates the ability for them to execute flawlessly on this stuff like a little bit underhanded by most definitions, right? against rules, against terms of service, you know, against privacy, like none of this stuff

matters to apploven. So, they have like karlanc. So, when the eye of Sauron, which won't happen probably under Trump's reign, when I s goes to AppL, then you know they may have some issues, but they're not big enough for that yet. They got to get to the Google the Google and Apple thing. And now we're getting political, so let's move on. All right, quick news here with the uh Diablo boss Rod Ferguson departs Blizzard. So Ferguson's been around for a long [ __ ] time, dude. Like the guy is is O [ __ ] G. And he is like literally I think the last OG guy left at Blizzard, right? And now he's leaving now. Everyone else is new since the Activision like really got regressive with these guys. But he was a general manager for the Diablo franchise for the last five years. He did Diablo II Resurrected, Diablo Immortal, Diablo, which was a little bit controversial, obviously. Diablo II, which did well, probably not as well as people had hoped, but did pretty well, and the expansion Vessel of Hatred. He is OG. I

actually met the guy. He's a really, really good guy, right? But from my understanding, this was always the plan. Like, his job was to come in and fix Diablo and launch this game and move the [ __ ] on, right? So, that's what he is doing. Evidently, he's not retiring despite his age and accomplishments. He's moving on to a new project, which he's not really saying what that is. Could be go work with the rest of the OG Blizzard guys at Moreheim or maybe fix Gears of War
potentially.
Please. Oh my god, I love that franchise.
Cuz as Microsoft completely dismantles and destroys every franchise they [ __ ] touch, but we'll find out soon. Evidently, he's going to announce very soon what he's going to be doing. I always heard that there was a little bit of a like not little, you know, new blood versus old blood type of a rivalry inside Blizzard. The OG's really didn't want to change and especially with the era of performance marketing and freeto play that that was quite difficult. Do you think, Eric, that the new blood won?
Oh yeah, absolutely. It was Bobby and

Armen, right? Barbie and Armen basically [ __ ] completely decimated Blizzard and changed the entire world at Blizzard, right? For better or for worse, right? Depending on who you talk to. I get it from both perspective. We've talked about this many times in the podcast, right? This is a new Blizzard, right? Again, for better or for worse, right? But all the OG people, all the creatives are gone, right? They left years and years ago, right? So, we'll see. We'll see, right? Like we'll see what what comes up. We haven't seen much. They actually did fix World of Warcraft, like in a way, like they got that back on track. Diablo was reasonably good, but Overwatch was a [ __ ] absolute train wreck. Everything mobile has been a train wreck except for Diablo. So, yeah, we'll see. We'll see. And I think with this whole Microsoft stuff is looking like the wheels are coming off at this point, right? In terms of people's motivation and getting [ __ ] done,
I don't see any changes in this. And what my understanding is from people that work at Microsoft is like everyone is running around like their heads cut

off. They have no [ __ ] idea what the strategy is anymore, right? So, and that trickles down to all these guys. So, yeah, we'll see. We'll see. You know,
must be an impact where they know that Phil is also leaving. Like, he already announced. He's like, I'm just here for the good time.
Was that fake?
No, Phil didn't announce he was leaving yet. People speculate that he's leaving, I think. Oh, but that was like covered in all the press that he will be leaving with a new
new console.
No,
I don't know. None of that has been confirmed.
Yeah.
Okay. But none of that
but he should have come out like, "Hey, this is bogus." Like, you could just tweeted.
Look, Phil's a great guy. Really sweet dude. And everyone's beloved. He beloved. Absolutely beloved, but he's not the right guy.
Not the right guy.
Yeah, meant Bobby.
Yeah, but I meant like like everybody's headless. Meaning that even if there's a conversation that even the leader is leaving after the next iteration,
right,
or next console cycle, then that's even worse. You don't even know who to talk to.
I mean, this putting Sarah Bond out

there quite a bit, who's president of Xbox, and she is very, very visible.
All right, Jen, we get it. You got the campaign donations.
Okay, cool.
Yeah,
it's true. I I mean, yes, you you all know that I'd love to support the strong women in our industry. However, it is true that she is out there speaking a lot.
Yeah. If you'd go to her, Sarah, what should we do about Gears of War? You'd be like, what? Anyways,
but Mishka, you had posted like a LinkedIn post around Stormgate, right? That Stormgate, which was,
isn't it Stargate's like spiritual successor?
No, this is part of the Blizzard family that has, you know, exited Blizzard and started their own companies. Storm. [ __ ] What's the the Starcraft followup? What's What's the game?
It is Stormgate. Remember this is by Tim Frost Giant Studios. They got VC money and they also went to
directly to the people.

They went directly to the people if you remember. So there there are shareholders listening right now if you remember.
All right, let me just take a step back. So Frost Giant is by Tim Morton. So Tim Morton is the CEO of Frost Giant, which is a team that was set up by ex StarCraft, two people, and they built a game called Stormgate, which is essentially an iteration or the followup or a version of Starcraft. You got the three races, and it's u RTS, which we don't see much on anywhere anymore. And it is free to play, right, Phil?
I remember they did early access founders packs. Remember they had a big campaign component. co-op was
it is not free to play. But anyway, he posted on LinkedIn saying, "Stormgate has had a smooth launch last week and the critical reception has been positive." That said, Stormgate is not getting the concurrency of sales that I hoped for. As the CEO of Frost Giant, that is my responsibility. I'm constantly trying to learn how to do it better. When I've had some time to digest, I will share my thoughts and opinions. So, basically, the the post on

LinkedIn is saying that the sales are not doing that well and they will have to do some correction moves. He didn't specify those and I understand it's incredibly stressful time. The team has gone from after the fund raise I believe they had Kickstarter where you can become a part owner of the company and we were actually covering it on this podcast. It was kind of weird. It's like you can't get
it wasn't just a Kickstarter. It was just it was a special financial vehicle. It was like a Kickstarter but remember you actually had
ownership through this very weird it wasn't an SPV. I don't know what Eric I don't know what the [ __ ] this financial engineering was but it's gross. Yeah, it was it was weird. I I remember the weirdest part for me is not Tim working [ __ ] hard to keep his company alive and to bring something new on the market. The weirdest part was when Bitcraft was announcing their $300 million fund. They had Tim talking as he they were quoting him and I'm like, "Guys, if you're raising so much [ __ ] money, give this guy a little bit. Don't make him like make these [ __ ]

financial vehicles to raise like 500k. How about you? You're fun, Tim. Anyways, that was the weirdest part of that. But looks like the game
What was [ __ ] Jasper doing, dude? Jasper should just kick some [ __ ] money down, right?
But yeah, but he was like announcing 300 million and then Tim was quoted multiple times and I'm like, he's out there begging money from players for a game that hasn't even released. Like, how? Like, I don't get it. Anyways, but I I've heard all the good things about Tim and I've heard that he works extremely hard and cares a lot. So it must be a stressful time for him as the game is not getting the the reception that he wished for.
All due respect to Tim, I really like the guy. I think he's like absolutely brilliant OG guy. But like building a RTS in this market right now is just
we talked about this ages ago. There was no product market fit at all. And only thing that made sense was go to the super core and charge a huge premium and try to do it that way to get like a few million people to get the game. And that he just didn't execute against the game. in the game was just not of high enough

quality to attract the audience that he needed to attract. So,
no, I I don't agree with that. The thesis was weak. You have the right answer. The threat of right answer, but you're going after an RTS tamaric. You caution Will Robinson, you got to stop there. You're making this like it's not as moas.
All right. All right. I was
This isn't an execution issue. I mean, you're executing. You're big fish, very tiny pond. Doesn't matter how good the execution is. Too small.
I made the same argument. I know, Bill. I'm just trying to give throw him a bone, you know.
No, no, no. And I don't The reason I don't want to throw him a bone is I do agree. He's an extremely nice guy. I remember gave that incredible beatdown of Web 3 if you remember
podcast beforehand.
But these founders don't choose ambitious enough thesises. And we were just talking about the Blizzard OG's not surviving. This is literally an example of it, right? The next news article is exactly this
and I think that is important like the market doesn't care, you know, doesn't care about your ideas and it moves

or your feelings, right? And and we were also talking about the Warcraft Rumble game, right, which had a hundred people on it a year later, right? You don't continue to throw capital into something like that. It doesn't have U-shapes like it does in HD. And I think that is very important.
You're right. I'm getting sentimental. my old age. Philip,
well, we started with your whole like, you know, midlife crisis. I think, you know, those of us that are dinosaurs or OGs in the industry need to realize that we can't keep doing what we used to do and have it work.
Like the industry is moving on and you know, genres that used to work don't work. Play patterns that used to work don't work anymore. And we got to realize this.
This is why I love Scopely, right? I think like Javier and Walter were the best that like they would get disciplined by the market and they would take the lesson, understand it and apply it moving forward even if they had their priors and like dude there was a lot of lesson
100% dude Bobby Cotch dude the guy [ __ ] executed he got rid of everything and he focused on three franchises period end of sentence like

yeah he he adjusted with the market [ __ ] EA finally adjusted with the market that's part of the brilliance of the CFO back then anyway sorry I I get you right
but there was also expectation guess how much frost giant raised
don't know
not as much as beatar which just got acquired by Dingo.
All right, everybody can go and Google that. So anyway, it's it's tens of millions. Anyways, hey, are you building a game, launching an app, or considering an acquisition? Well, in that case, Deconstructive Fund Consulting is here to help you out. We do everything from market research to go to market strategies to live ops optimization and due diligence. We're trusted by some of the most beloved game development companies, makers of tools and tech as well as some of the most renowned investors. Now, if you are building, launching, or buying, don't do it alone. Do it with us. Connect by

emailing to consulting diggafon.com.
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of Supercell and built by monetization pros from Moon Active, Platika, Huge Games, and others. People who know the difference. App charge powers over half a billion dollars in transaction a year for top studios, optimizing every detail. deeply personalized web store offers custommade design, industry-leading monetization features, in-game payments SDK, and more. 70% of top grossing games already have a web store, but the one scaling fastest, they're doing it with app charge. Learn more at appcharge.com. [Music] So, BeatStar is the maker of Next Bead and they have been acquired by Duolingo. So, technically, Duolingo has entered the games business. And correct me if I'm wrong, but this is the timeline. So, Supercell takes over Space Ape in January, right? It spins out music, puzzle, Transformers, and the founders.

So, basically everything that they had. Spacip's co-founder, Simon Haye, takes the Beat Star and the Country Star team and forms them into a next beat, a separate company. And I assume as they form this separate company, even though they have two games, a team likely profitable games, they start raising an equity round because they, you know, need to build. And I assume that Supercell wasn't, you know, giving this out for free. So, as it spins out, it probably had a portion of that company. And I assume that they went for a funding round and that funding rounded in a total acquisition of the entire team and congratulations to Supercell Investments. They got an exit. Of course, it was probably a little bit smaller than what they paid for Space Ape in 2017. But let's not talk about that and let's congratulate Beatar team because I think this is a fantastic opportunity for them. I think Dualingo, not I think we know that Duelingo is absolutely crushing it. Yes, their stock has been going down a little bit as of

late, but what is it? Is it like a 12 billion or$ 14 billion company? It is huge. 15 15 now. Amazing.
That's oneird the size of EA. What is EA? 45 40.
Yeah. Yeah. So, it's it's amazing. It's based out of Pittsburgh out of all the places. Pittsburgh. So, interesting place to
There's actually good technical talent there. Just a heads up. There's a lot of engineering talent there.
Yeah. Yeah. A lot of Steelers, a lot of Penguins, and a lot of Pirates. That's all I know.
What's it What's cures
and let's be honest, running a startup [ __ ] sucks and so luckily they had a very short journey on that and I hope they knock their earnouts out the park with this one. So congratulations to the
first of all let me just correct one thing like this obviously was not an acquisition. This was an acquire of talent, right? I don't think that there was any premium paid or whatever. It just felt like they just acquired the team, right? which is great for Simon who is a friend of the podcast by the

way.
And it's also kind of this whole trend that Bucken Bing was saying at GDC is now we're bringing more and more gaming talent into apps, right? And so this is like a trend something to leverage your experience and skills and bring it to apps. And of course Bing Gordon is on the board of Dualingo. So anyway, it's really great opportunity for that group and that team and our friend Simon to see what he can do at Dualingo.
Talking about games and apps and talent in games Lee Horn. So you might remember this from Mountaintop Game like the latest update is actually about Spectre Divide. He also joined Duelingo just recently as director of product of growth and social helping to develop the best education in the world and make it universally available. So it seems like Duelingo is really bringing on gaming talent and all sorts of gaming talent. So pretty interesting.
All right, what else we got?
Playa eyes bullish

40% direct to consumer revenue. If you remember, Playa has been the company that's been like leading when it comes to direct to consumer. And not only that, they report their numbers. So we can get a good idea of what web store adoption is looking like. And so it's actually flat for Playa. They've hovered around this 30%. And it's actually declined slightly. And I think this kind of covers up a lot of what's going on because their portfolio has also moved to more of a casual mix. So whereas they used to be getting 42% of their revenue from Social Casino, now they're only getting 29%. Where the other share is coming from casual themed games. If you remember, like having lots of whales drives a lot of web store activity. We know that from surveys like Forex games, clos casino games all tend to have these mechanics. And not only that, like Play Tikica runs a really amazing playbook when it comes to getting people onto direct consumer. Like I think the cat's kind of out of the bag now, but like they'll do things like send iPads with the Android store that they have

connected that they're connected to pre-installed. So like when you go to make an IEP within the side of the Android app, it's still an in-app experience, but it's using their own payment rails. It's not even calling a web store. Again, it's like it's a sideloaded app, which I think is really interesting stuff. So we'll see if they can get to this 40%. They may already be there in social casino. It's just the increase in casual covering it up. But I think this is a good another check-in on whether or not you can get these numbers higher and higher and higher.
Okay, two things. one, their percentage of mix of casual is absolute [ __ ] because they put bingo in casual, dude. That's a casino game by definition. [ __ ] move that over like and they only did that for the visibility of it from the Wall Street perspective. Okay, that's first. Let me just do correction there because that is complete nonsense.
The second thing is that despite their 40% direct to consumer strategy, their stock is at an all-time [ __ ] low, dude. it is below $4, right? Like, so

this strategy is not resonating with investors. And you know what would resonate with investors? [ __ ] organic growth, right? Build a game, market a game, sell a game, and be profitable, right? Like, let's do that for once. Okay? So, the fact that they're moving
to 40% or whatever, this [ __ ] shell game is not helping them. And that's what I've been trying to say for years on this podcast is that regardless of all this move to regain margin from [ __ ] the stores. You need to figure out the UA problem and you need to figure out the game development problem. Right?
What makes it worse too is that margin doesn't just go to your bank account. It goes into the UA bank account. I just did a trends presentation for AWS last week and one of the things that I talk about is that while everyone is super excited about this DTOC, it's basically just a transfer from going to the app stores to going to the UA company.
It literally is a transfer from Apple to

Apploving. Dude, [ __ ] that. It's great for Applo, dude. Look at their stock. They're up [ __ ] a gajillion dollars. They're 77% growth, right? These guys are declining precipitously, right? Okay. Okay. And then the third thing is the direct cons to consumer model is actually broken in this business, right? The revenue mix is actually lower. They're actually declining in terms of revenue mix. And that's partially because of the Super Play acquisition. I get it. Right? But this actually shows the limitations on going direct to consumer is that there's only a certain percentage of people that are going to be willing to do that. And yes, this may change when they make it a lot easier and less challenging for the publishers to do that. But by the time these changes actually happen, it is very likely that Apple and Google are going to go back down to like 20% or something and then it's going to completely flatline this whole narrative. So this narrative is broken. Just stop it. Just stop that. It could be part of the narrative but you have to say we are

investing in teams. We are building teams. we are losing using margin to build teams to build product to come to market right like well and you know they did do some inorganic acquisitions with super play etc that that works as well the whole zinga model but this whole company is just not working right now like from a stock perspective
yeah I think it said that in the good news Disney solitaire was hitting a hund00 million annual run rate
wow
for your in a sense you know inorganic growth because they purchased that from superplay and then I think they said some of their franchises were down a little bit, but I think a lot of this leads into the next story, which is sponsor and friend of the podcast.
This was hot of the press, off the press. I think this came out a couple hours ago. So, Appcharge raised $58 million series B round led by IVP to scale top direct to consumer platform for mobile games. So this was series B funding led by IBP which is a massive $7

billion fund or $7 billion assets under management and this is actually following their $26 million round raised in November 24. So this is coming in a little bit over half a year after. So means that they have the traction and are raising to accelerate growth. Interesting in the participation we had play ricks as well as the existing investors the play ventures the bitcraft ventures perhaps supercell followed on this one because they were in the previous round. So overall awesome to see our partner scaling and getting backed by the powerhouses and if you're not using app charge solution yet maybe now is the time since they have the top publishers all supporting them and likely using
one more comment on the app charge thing. this is a VC investment like this is actually makes sense as a VC investment in gaming right where you're scaling up and you're getting more market share and you're growing revenue and stuff like that you're you're basically this is the definition right versus mobile
what's your moat what's what's the

what's your defensibility
yeah it's salesman it's relationship it's investors it's it's strategic investor etc it you're scaling to take
I mean I'm not suggesting that this is going to be a home run for these guys what I'm suggesting is that this makes a lot more sense of investing as an investment for a VC than believer, you know, like it's like, and of course, who's not on this list? A16Z and Light Speed, right? Anyway, all right. Sorry. I don't know why I keep bagging on these guys, but anyway, moving on. Battlefield beta. Okay, sorry.
So, Battlefield is back. That was the article that was written by these guys in Insider Gaming. I keep asking myself, is this different? Will this time be different? Or is basically EA like Lucy, you know, pulling the football away right when right when Charlie Browns are out ready to kick it? Cuz every single time that EA comes out with a big release, we think it's going to be different, but they always [ __ ] disappoint. They

always disappoint, right? And they do the same goddamn thing
on Battlefield, not on like FIFA or FC,
everything non-sports related, just to be clear. Okay, now that was Anthem, Battlefield 2042, Mass Effect Andromeda. Most recently, Dragon Age was a [ __ ] ad disaster of all epic proportions, but they failed like basically over and over again. And the only real successes that they've had over the last decade that I can think of is Apex and Jedi Fall in Order, which obviously were both under Vince's watch, right? Vince Sella. So, so anyway, it has been kind of a really tumultuous time. And actually, go back to Star Wars the MMO too as well. Hey, that still generates money by the way. The Star Wars I think it's run out of Austin last I checked and that thing actually was cranking money. I think it was 10 million a month. It's a great game.
Nice nice little private equity business.
Don't get me started on that. Don't get me started on that. I was way too involved with that one. Okay. All right. So,
all the signs are positive for Battlefield in my view. Right. I'm very

bullish right now on Battlefield, particularly for the launch, right? It's a great game. Huge amounts of engagement and hype out there. Like everyone is talking about this [ __ ] thing, right? The gameplay is amazing. Solid technical performance, which is impressive given their history in terms of releases and technical problems. Amazing visuals. We talked about this ad nauseium, but like the explosions, the secondary explosions, the, you know, environmental like dust and I mean it's crazy, dude. It's so insane. If you play the game, it's like really really I hate to use the word visceral. The only issue so far has been the fast time to kill, which again, as I've said, but many times is it's leaning more towards Call of Duty than Battlefield of old, right? Like they're pushing more and more to that direction, which is a faster time to kill just generally. But this could be fixable if they choose to, which I don't think they will. And the big thing here is that Microsoft is really dropping the ball on Call of Duty this year, right? Is relatively clear that they are behind the eightball here. And clearly

Battlefield is smoking them with the hype right now right now. I don't think Call of Duty is going to drop dead, dude. Believe me, I don't. I think they will come back in the next few months and go big or go home and spend a enormous amount of money in order to promote Call of Duty. But I think Battlefield has gotten the Zeitgeist and the interest of the consumer ahead of Call of Duty. And I think that puts them in a really good position. And so what I think is they should be able to do like 10 to 15 million units easy, right? I think they probably get north of that which would be great but the question really is whether or not they have the talent and the plans to actually support the game after launch right so can they build a live service that keeps people engaged well after launch and that's the question that I really need to be answering soon and the last point I want to make is that like clearly this game is being orchestrated by Byron bead who was of Call of Duty fame as well as Vince Simella who are both in LA. Part of the reason that the game is

successful because it's not being run out of dice. So, sorry, Philip, but this is what I've been told. Anyway, this and so like these guys are in charge and they're not [ __ ] living in Sweden, right? And DICE has become like a secondary studio in the game development amongst like three or four other studios. And that's part of the reason because I'm not blaming DICE, but Soderland has basically just [ __ ] destroyed DICE by pulling all his people out, right? So, they're not really the DICE of old. So that's part of the reason I think they're seeing a lot more potential success is because they have lots of more resources building on this, which is what Philip basically suggested last week. But anyway, I've been [ __ ] devastated before. The customers been burned before, but I'm hoping this time that Lucy will allow Charlie to kick the ball. What do you think, guys?
Does anyone even know Charlie Brown in our I guess we have a bunch of Gen X's in our audience that grew up on on peanuts. So, so here's what I wanted to kind of double click into. I know you love when I say that this is the story

of the industry right now with GTA moving out into next year. This is the game that is kind of filling the question mark of what's going to replace in a sense GTA. Now, of course, it just doesn't replace GTA, but what it is is giving a ton of hype. And I'm actually really happy for EA that this is showing so well. And I've actually talked to a number of people in the industry that coming out of this week are like, "Oh [ __ ] we thought we had a clear runway going into Q4 and it might not be as clear as we thought." Especially if you have anything kind of touching the area of a shooter or anything that touches this kind of player and consumer because right now they are sucking like all of the energy out of it. So I pulled a couple of charts, you know, Phil's been showing them. Those charts were from Reese Elliot, who is from Alenia Analytics. The first one just talks about 2.7 million wish lists and pre-order revenue of 35 million just on Steam. By the way, the launch is October 10th. And so we are quite a while. And

so this week, this past like two weeks leading up to it have been absolutely crucial for them. And I want to give some credit to marketing because no one ever gives credit to marketing. So they did a kick-ass reveal trailer. the multiplayer gameplay event that was like this 4hour stream that they did. If you didn't watch it showed incredibly well like famous influencers so much so that there was a wish list spike the first kind of line where the wish list and everything really starts taking off was at that July 31st multiplayer gameplay event. So plus 62% in one day from that. So the next image shows the just constant planned drum beat of content from the marketing team. This is influencers, it's press, it's trailers, it's these deep dives. All of this going into this beta weekend, the second weekend of August. And then there's another beta coming this weekend. Here's what they've done. So well depress just like you said, the game is like doing

amazing. It's checking the boxes. The assets are showing the USPS. I completely understand what I'm getting from this game. As you look at any of these assets, the assets preemptively answer everything that you want to know about this game. The constant just drip of content keeping the attention high, the wish lists growing. I don't know if I've ever seen wish list like up and to the right like we've been seeing. you know, just going to the YouTube page every day or every other day is another massive trailer or support asset that just keeps that buzz really high. And so, I wish Adam was here to talk about this, but Adam and I have been talking about this last couple months, which is your launch is not your launch anymore. Early access or these betas are your launch and you have to start acting like it from the beginning from a product standpoint and a marketing standpoint. And I think EA is really the first person to do this and do this really

really well and the numbers are showing that this strategy is paying off. But Chris and Phil, I wanted to ask you about cheaters. So the crazy thing that seems to throw these shooters off is just what goes on with the cheaters. And I and I hate that this is kind of what it comes to. Is there any idea like how cheaters are starting to factor in? I know I saw a post from one of the designers who was like trying to address this fast tokill thing or any of the cheater stuff that's already coming up because the cheater will figure it out in the first weekend and they did. Any any thought?
Uh they're screwed. This has been an issue forever and this will never be solved.
Oh god.
But this is the PC thing, right? This is not a console thing as much, right? And the majority of the units will likely be sold on consoles. So it's like a vocal minority people like talking about
the majority of the units will be sold on consoles. I Whoa. Do we Do we ah Whoa. Wait, we have a story. PC developer. It has human flags on

Call of Duty. Call of Duty is like 80% console. 80%.
That's fair. When we think about unit sales, I would instead offer like, you know, longtail CCU tends to be primarily from PC.
Yeah.
And Battlefield 4 is also an interesting mix. But sorry, go ahead. Go ahead. Go ahead.
This stuff is driven by console. My point is that the PC is a cheating is on PC, right? And so like
Yeah. Okay.
And so like
if you want the right if you want experience without cheaters then you go to console, right? And
got it. So versus COD Crest actually there's this quote from Mike Yara who is the Blizzard president and he said Battlefield will boot stomp Call of Duty this year but the real win here is COD won't be lazy anymore and we'll all get better FPS games for it. them is fighting words. We're going to have to do our bet again. And um
Okay. Well, [ __ ] By the way, M Mr. Mike Barara, who works for Prize Picks, which is basically corrupting the youth of America by introducing them to real

money gambling, right? Dude, you can't be throwing stones at glass houses, dude. You better look in the mirror before he starts talking trash. You know, there's clearly some bad blood there with Microsoft, you know? No doubt, right? But like Jesus. Anyway, I don't think he's wrong, though. I think he's here. I think I think he's dead right though. You know, like this year they they likely will have an upper hand. It is possible they could outs sell Call of Duty, which is crazy, right? I'm not making that prediction quite yet,
but actually maybe I will make that prediction right now is that they out sell Call of Duty.
Oo.
Um for launch.
Yeah, I think I'll I could make that bet.
Okay. Yeah, we should in launch like in this year or in launch week like what you want to get specific here? Let's do for this year. God, we're not going to have that number though.
Yeah,
but I I bet those guys those guys will be able to do it. Reese Elliot and his team will be able to like figure it out.
I bet you so close that it's going to be a flip of the coin. But I I'll say Battlefield's going to win.

Okay.
Not [ __ ] it. We're crushing them.
Yeah.
All right. And we're all Battlefield. All right. Let's throw some juice behind Battlefield. All right. I love it. Okay. Mishka, do you care?
No. No. I actually I I can't touch these games. I don't like these games. I I remember when that Star Wars one came in from Battlefield and I was like, "This looks exactly like the game I would like to play and I played it for a bit and it is straight up, you know, Battlefield. You just get smoked all the time. It's not fun at all. I don't understand. I don't enjoy those place games. I I like slower shooters like wargaming shooters. That's a nice one. Battleships, something slow or robots." So, one thing I will say is we are going to split out Battlefield into its own cast. So, stay tuned for that. There's a lot more coverage here. I think you're completely right, Jen. Like, this is dominating coverage and deserves its own period of time. And I think we're going to have a really fun cast for this
with Put Okay, fine. Well, I I actually just

basically did my section on the podcast, so got to have the marketer in there. Okay, what else we got? We got Moon Active, new and old games. So Moon Active, I think they quietly launched three new games, we've talked about one of them, which is their Monopoly Go followon inspired titles. But before we talk about their new games, I just pulled their Q2 of 2024 and Q2 2025 just to take a look at their portfolio and what is it looking just to give a context for the new games. So their portfolio overall unsurprisingly Coin Master is 70% of all the revenues really being steady chugging along hasn't had a hit from Monopoly Go scaling so fast and you know producing nice billion dollar plus in net revenues a year. The rest of the portfolio is that 30% and that 30% is essentially divided by two games. So Travel Town takes 20% of their portfolio and Family Island takes 10%. Everything else, Zen Match, Mike Cafe is rounding errors, you

know, despite being probably many developers would or publishers would like to have those games. Anyways, so Moonactive 1.5 billion annual revenue. They got five games. And by the way, comparison to Scopi, I just wanted to say this, they look almost identical in terms of the portfolios because out of all the Scopies game, one game generates about 70 to 55% depending on a month. Meaning that if Pokemon Go is running an event, they would take up to 30% of the revenues and if they're not, they're below 20 and Monopoly Go is typically that 70 to 55% and the rest of the portfolio is about 15% and they just have a 20 games compared to Monactives 5. So anyways, similar type of a breakdown in terms of couple of games making most of the revenues. So let's talk about their new games. So Coin Master Board Adventure, we talked about this one. So, this is essentially pulling the U coin master pig and making a new version of that game taking inspiration from Monopoly Go and Board

Kings. Then they went after Phil's favorite game, but the new game is called Hole Stars. And of course, our it features the pig, the beautiful pig. They're really leaning into this pig, which is uh kind of ironic given where the uh the company is from. Anyways, they're using this pig and they're essentially making a version of Homer's uh all inhole game uh which has scaled really nicely and is on on the route of what 100 million in revenues.
I I called this years ago this revolution was happening. This reverse Katamari Damashi it just works with a match core so easily, right?
Yes. I love it.
I'm surprised that they went to this genre. like looking at their previous genres. There's simulation, there's, you know, casino essentially, match 2, and now they picked up a totally new one, which is is this a puzzle game? How would you describe this? A hybrid casual game or what's the
I guess hybrid casual. So basically if

you are watching or you haven't played this before your character is a giant hole and then you go around the board and collect different pieces and as you do that your hole gets bigger so that you can collect bigger and bigger pieces and you are limited by time and so you have to collect all of the objectives before time runs out.
Yeah, very phallic. Very very
Yes. Yes, it is.
I hate that.
Yes. Anyway, so so copied it. Also interesting like they took a game that existed as a as we talked about hybrid casual game just improved the the production value. So I guess um you know we'll see if this succeeds then the the hybrid casual portfolios of the woodoo and and the of the world are up for grabs for bigger publishers. They're going to just you know rip it put it put their IPs in them.
And keep in mind keep in mind as I've said many times on this podcast is that these guys are private company. They have unlimited budget to spend on this stuff and they will [ __ ] bury people

right on spend
unprofitably potentially, right?
Yeah. Assuming they're highly profitable. So they do have the war chest to absolutely demolish great companies like Koma, but that's just not the size of Moon Active. And the third one is Zen Match. So this was an interesting one because so it's called Match Dreams. It looks the same if you're watching this on Spotify or YouTube. Not Not that it looks the same. It is the same. Like the creatives are the same, Jen. I don't understand what's going on here. Like,
so I guess what I forgot is that Moonactive has Zen Match
and so
are they just rebranding it?
I think they just rebranded this thing because it's been around since 22.
Yeah, this one. Um, I know Tilebusters is Spike's version of this genre, which is kind of like the you're matching little tiles to put them on the board. I think that that is smart. Well, they're not using the pig though, so I don't know why they rebranded this.

Yeah. So, just the last piece on that, like again, this is just rumors on the streets of Istanbul, what I've heard regarding because you mentioned the the Tile Busters. So, Tile Busters, you mentioned that one. It's it's from a company called Spike Games which is u led by Reena Anor. She was on the podcast. I think it was called Istanbul Confidentials. It's interesting because Moonactive dropped $50 million I think it was a year or a year and a half ago into Spike Games.
And what I heard from that that's public. It's uh you can Google that. It's it's all there as an investment. But what I heard in Istanbul is that actually what was happening is Moonactive was acquiring spike games and due to the geopolitical tension between Israel and Turkey what happened was they weren't able or weren't a device to go through with the deal basically have majority of a Turkish company and instead of dumping you know Spike games and and kind of just walking away from

the deal after what I assume would be a longer due diligence and negotiation ation period and really a stressful time especially for Spike Games. They ended up doing a minority investment of $50 million. Now, I don't know if any of this is true. This is just hearsay, but I just want to mention this because if they did so, that's an incredibly nice thing for a for a company to do. I know we talk about how much gangsters they are and how much they crush others allegedly and smooth actor, but if they did this, then then that was the the nicest way to kind of not invest due to force majour. So, I know Moon Active never speaks out, but um but seems like they they were the uh the gentleman's in this in this case.
Okay. All right. I think we're at time. I will [ __ ] on Nintendo's My Mario next week. All right. See you next week. And oh, well, let's see. Let's Gamescom next week. So, Crest is out and we'll have some other old voices of the podcast come back. All right. See you all.
See you all. Bye-bye.
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