TWIG #392: Pokémon’s Gamble, World Cup WHAT & the Monetization Debate

[music] Hello everyone and welcome to Deconstructor of Fun This Week in Games. I'm Jen Dano. I play the marketing and publishing role on the podcast. Uh it is three for tweak. Today we have
Eric Chris strategy investing.
Phil Black Monizations are summer.
Welcome back.
Welcome back. All right, let's get into it. Here's what we're covering. League of Legends gets nostalgic and we'll add League of Legends Classic. Who's winning the World Cup besides probably Spain, but in games is what we want to talk about. So, Phil surprises us with E Football. Actually, he has something else that he wants to talk about there. EA Sports fumbles with microtransactions in college football, having to remove it after a player backlash. I think was only out for a couple days, too. We're going to review that and some history lessons that nobody seems to pay attention to. How important is the physical disc in the game industry? 200,000 people think it's the end of the

world as Sony looks to remove discs by January 2028. We pull some stats to help them understand that they are being careers and should get over themselves because the world has moved on. So, uh, Phil, great to have you back. Did you you start to vacation like you're a European now? I'm I'm I'm impressed.
I went to Scotland. I went to Athens to go visit Mishka and then he he reactivated his Jetet life and is growing his Instagram follower count by traveling to different islands. So he's living the life that he's always advertised.
All right, let's do a little shilling. So the next Deconstructor of Fun round table is coming up in Seattle in August 6, like 3 weeks from now.
I am booked, by the way. I booked my flight coming. I'll be a little I might be a little late though because I don't know how hard it is to navigate with Seattle traffic to get from one place to another.
Yeah, we're going to start around 11:30ish. We're going to start like a touch later, giving you some time.
Oh, 11:30. I thought it was 9:30

because we're inviting some Vancouver people. We wanted to allow for a little bit of time of travel in the morning. We have a ton of people already signed up. As you can imagine, with Seattle being a Microsoft center, we're starting to get a lot of Microsoft Xbox people. Please
please come and hang out with [laughter]
Oh my god. Am I going to be forced to talk about this whole the the the Xbox thing for hours? Is that what's going to happen?
Uh I I actually think we should probably avoid that topic uh too much. Uh hopefully at that point we'll have moved on. We're going to do a lot of AI. So it's at Amazon AWS's headquarters. And so they're going to actually do a little presentation for us on AI and games. They've got some great data. And then Laura is there, Josh is there. So we're going to have a little twig, a live twig. And then go into the roundts. Super fun. Actually, speaking of Josh, he did a podcast. He spoke with Adam Smart from Appsier on web attribution. So it was fun hearing Josh being like

kind of fish out of water because he's such a mobile UA guy. So, they were talking about like, you know, how web attribution is the thing. And by the way, I can listen to Adam all day long with that accent. Like, he has an accent made for podcasting. So, so let's go to corrections. This one's really funny, and it's not me, but I'll apologize on behalf of Mishka and our and our newsletter team. Apparently, Subway Surfers is hard to spell, and uh quote, "We uh misspelled it in our last blog post. I I don't think we've ever had so much feedback from people It's been fixed. We fixed the name. Wasn't even like that bad, but it it was kind of like we merged Cybo and Subway Surfers together. Apologies to any surfers we offended. Thank you for your patience. On the positive side, the Cybo Studio are fans of Deconstructor of Fun and it absolutely made my day when the studio lead reached out and it was very, very cute and was like, "Would you mind please fixing the name the typo? The Danes are just so lovely." So, thank you

guys and sorry about that. Cybo and Subway Surfers. I think we shouted out like a 4,000 something number, Cres, when you did that news and I think you were covering all of Microsoft, not just Xbox. So, a lot of people said, "Wait, did you guys get the number wrong?" And that that was the difference there. So, no big deal. So, you had a couple other things you wanted to hit on Microsoft and Xbox.
Yeah. Actually, I think we put the 4,800 in the actual YouTube and link thing. So, yeah, that was
Yeah, that's what just caused a little bit of confusion. So it clarifying that
this is more of a clarification because I kind of made the claim that Chararma doesn't know what the she's talking about when she says, "Oh, let's just make the Bethesda guys build more Elder Scrolls or whatever like that." Like she can speed up production in some ways. Actually, that was not what she was doing. So, I have to give her kind of some credit here because basically what she's doing is she's hiring Obsidian basically to do another Fallout like New Vegas style game which they have done before which in essence will increase

the frequency of releases from Bethesda but just not from Bethesda itself because the reality of it is Bethesda has one studio right I mean that there's basically just one studio for Bethesda that makes Fallout, Elder Scrolls and Starfield and that's why it takes them like forever. ever, right? To get between Starfield, Elder Scrolls, and Fall. So, one solution obviously is to hire another studio to create more content for their franchises. And that makes sense. Having said that, there's a reason that likely hasn't been done since I think it was like 2010 when Fallout New Vegas came out. It's likely because Bethesda doesn't want other studios to make their content, [laughter] right? Because it'll be a different game because it's a different studio. Like, you can't build it the same way they will do it. So, anyway, I just wanted to clarify that. I think that is a good strategy from Chararma like that to try to expand, you know, the ability to make these games.
Well, isn't there a TV show that's like just really crushing it right now for a couple of seasons? Would that be why,

[laughter] guys?
Yeah, exactly.
I thought I read something too that somebody was working on a vowed 2, which apparently
Obsidian. Yeah.
Oh, yeah. And and so everyone was like, why are they working on a failed a sequel to a failed game and not Fallout? Is that part of what you're covering here?
That's what exactly what I'm covering right now. And that makes a lot of sense. But again, what I will say is that the the leader of Bethesda, it could be, and I don't know this for sure, I'm just speculating here, is that he didn't want to outsource game development of his beloved franchises because he wants to do it himself. Todd Howard,
that could be it. And so by doing this, maybe you're pissing off Todd Howard. And so Todd Howard bails and then all these lieutenants bail and then you up the whole franchise anyway, right? So it's like,
you know, this is what part of the managing creative things that's going to happen down the line that like whether or not like, you know, these seem like good ideas now, but they could just

completely blow up in your face if you don't have the people to manage these creatives, right? So you know, and certainly not Chararma, you know, like the apex predator herself who's going to basically massage Todd Howard. Todd Howard's gonna go yourself. You know, I've already made my money, dude. So, he may actually just bail after the next Elder Scrolls, which should be out in 2028 or something like that. You know, that that that's very very likely and all his lieutenants. Who knows, right? But this is this is where they're going to run into problems down the line.
Well, this is where managing studios is it's kind of like like a roster of creatives, right? you have all of these different personalities that you actually have to contend with in addition to the business side of things. You know, creatives get their feelings hurt. And so it it's not just numbers. It's like I said last week, it's not just chips in the bag where you don't offend people. Like these are their babies. 7 years. That's not a sponsorship.

That's a marriage. And that's exactly how long we've been partnering with Apps. And the reason it has lasted is simple. Every growth team I talk to on this podcast, every operator who comes and breaks down what is actually working for them, eventually the conversation lands on measurement. And in gaming, we refer to reliable measurement with a single word, apps flyier. Just think about it. Melo, Meta, Google, and Unity all back this platform, too. Which means the people competing hardest for your budget all agree where the single source of truth lie. [music] Eiffel Tower iconic Tower of London historic. The two towers simply epic, but none of them tell you anything about mobile app intelligence, downloads, revenue, active users, and my personal favorite, weekly cohorted retention. Get the real story. Get the real data. Get Sensor Tower today.

Let's get to the first topic. Uh, nostalgia for me as as I used to work at Riot. So, from Fortnite OG to Overwatch to Apex to WoW, the nostalgia drug is real and apparently delivers. So, Fortnite hit 44.7 million players in a single day on November 4, 2023, an all-time record when they re-released Fortnite OG. And then WoW Classic drove a 223% jump in subscription revenue in August of 2019 versus July. The biggest quarterly subscription increase in franchise history. What am I talking about? These are classics. These are going back and re-releasing the classic version of your game when you're a forever game and you've been out a long time. Who is now doing this? League of Legends. So, League of Legends joins the list with some very on brand and very funny announcement trailers and a new logo that makes me smile since I know all the stories behind these logos. They blended the old and the current logo to make the classic. So, Phil's actually

showing I pulled all the logos, even the original logo, which you know, all of these obviously are very inspired by that game called World of Warcraft. So, you have League of Legends, which was the logo on the left of the screen through 2019. I think it was 09 through 2019. It was up during the classic era. And then the new logo that's been around since 19. I was there when that logo got made and took like a year. And then the new logo for classic is a little bit of a combination of both of those. So I can only imagine that took six months to make that just knowing people and their opinions. So, Riot has unveiled League of Legends Classic, a new version of its phenomenally successful moa designed to tap into nostalgia for the game that was over 15 years ago. The new mode is a greatest hits collection. So, they're not just copying the old version, they are taking a bunch of what made it great and they're drawing heavily from season 3. So, this is the era of the game where it really was taking off. Notable

features include a classic roster. So they actually went down to 60 champions, 40 original, plus 20 early release. Old systems maps and rules. The thing that I think is probably the coolest feature of this and people should learn from is something called community voting. So similar to old school Runescape, all of the future patches will be decided via community voting rather than strictly by Riot. Really involving the fans on this. So my take first of all, kudo to all of my Riot alums. Just the community content is so spot-on, the humor, the deep understanding of their audience. This is a Riot superpower. They understand their audience. They are authentic devs against what players really truly want because by the way, they are the players. And so when this is a perfect match of you are the geek making the game for people like you, it is the perfect storm in all of the best ways. So should anyone want to study Gamecom's community messaging, Riot is S tier on this. They continue to lead the way. Supercell is a strong number two in

the world of mobile for community. And next, playing our theme from last week that new games are only six to 15% of revenue on console and PC. Riot is doing what others seem to be doing and working. They are remastering, reimagining. They're doing this greatest hits version. It's a triedand-true brand. Yes, it might be having some challenges in today's world, but you know going back and targeting your long lapse players, your current players with something that is modernized. It's what you remember, but you know, updated for today. That I think is super fantastic when I think about people are like, well, why didn't they just like remake the old thing? If you've ever gone back and like watched a TV show from your childhood, like I used to work on these games for G.I. show and Transformers and I grew up loving them and when we went back and watched the original content we were like oh my god this is like the most horrific thing possible. So I love that they are not just turnurning out

the old stuff but they are truly reimagining it for today's world. So anyway Crest I think this is a good strategy. Do you think spending time on a classic mode going after whales makes sense? Well, I don't know about this whole love fest around Riot, but like [laughter] Jesus Christ,
that's awesome. They did this fantastic.
Look, this seemed to work really well for World of Warcraft. I mean, there's a lot of massochists out there that want to relive the World of Warcraft old OG days in which it's absolutely painful, you know, to get here and there and there like the death penalty is huge, whatever. So yeah, more power to them if they want to like go out there and play this game with all the creature comforts, relive their progression, you know, through the big expansions, all that stuff. I agree. And it did work for World of Warcraft really well to, you know, kind of reliving the glory days, I suppose. So I am clearly not much of a League of Legends guy, so I don't really understand what this means to go back

and and only I guess only have the original characters, the what 40 or 60 original characters.
Yep. Yeah, they cut down the list to 60. I think
the video was really funny. They're like, "We're cutting all of these characters." And you're like, "What?" Because they they're over 150 160 characters now. So, it's pretty funny.
But I guess cuz we know that most of the revenue is coming out of China. So, the question I had was, you know, is this going to be like coming out in China as well, like out with the rest of Asia? Like what are they doing to support, you know, their real audience which is in China, right? So it's like
I can't imagine this not working and they seem to be doing a good job. I'm actually s a little surprised they haven't done this earlier to [laughter] be honest. Like my understanding is they've been struggling right to League of Legends the last few years. It seems to be obvious.
Phil pulled some charts on how it's doing and it has been struggling and I can only imagine they've been working on this for a long time. They wanted to get it right. And one thing right does well

is, you know, you can't put something out halfass and piss people off because this is going to be a revival moment. They're going to go after, you know, long laps players. They're going to go after people who love this. And yes, so to answer your other question, China is getting League classic. It's essentially day and date. So July 30th versus the 29th because, you know, you have the day lag. So Riot and Tencent treated this as a global tent pole and not just a regional moment which is you know very true and yes China is like a huge amount of the business and that's actually published by Tencent. So they also get their own economy pre-registration was July 12th to the 29th with a fully loaded Rune page as a reward. They did something really fun which is they ran a classic showcase match. So, at the MSI finals, they pulled in all of these influencers from like season 3 and had them basically demon, you know, like play the old game, well, play the the new League Classic game. And it got a

huge response. Like, everyone just absolutely just peed their pants in the excitement for that this was what was going on. So, I I can only imagine that, you know, this is going to work incredibly well in China. I don't know if I think I might have said this in the past, but League is has the highest awareness of like almost any IP. It's higher awareness than Star Wars. So, the thing that I wanted to ask Phil is I noticed some of the monetization changes, all these battle passes. Do you think this is going to help what you know, again, it's always capped in a sense in the West by the cosmetic aspect. In the east, they do have some loot boxy things. seeing anything here that gives the the black heart of monetization some hope on what this can do for the game?
The thing I was first interested in was how big Classic was. Like I've always heard rumors about how big Classic was for World of Warcraft and there was like a leaked to GDC talk and so you can kind of gather a couple different pieces of data and produced some resemblance of a

time series. And when you look at like the 2019 pre-classic to where you ended up after Classic, I mean it almost doubled the subscriber base. And these are subscribers because you got to remember World of Warcraft had this token thing. They had shareware where remember you could get to level 25. So there there are some things that are happening underneath to the KPIs. But if you look at subscribers like that is a pretty good suggestion of what revenue is depending on what you put for the average head. And I didn't realize like the game is still like pumping around like a billion dollars a year. Like it's still an important franchise
to Blizzard which I think goes back to all of our conversations first of all about just how do you grow this franchise and what mobile looks like. But at the end of the day, you know, you saw Fortnite do this, which was a massive success. It seems like the obvious play, and I think the question is like, why haven't more people done this? Why haven't there been more classic or OG modes? Like, literally, you're reusing content. It's really old content. I was thinking about whether or not this this playbook works for mobile. I think, first of all, Call of Duty can do something very interesting here. I think Battlefield has kind of already

done interesting things here kind of with this this nostalgia play. Can Candy Crush do this? Like can can Clash of Clans like is there a mobile playbook for this too or is this like just games you have like childhood attachment to?
We just saw them try to remaster reboot Call of Duty these two games for Call of Duty and it just blew up in their face because they didn't have the tech for the cheaters. So it just became an absolute cluster of cheating you know. So there are some risks here and I know during the time that World of Warcraft was doing this the biggest concern that they had was splitting their user base right between two different services which yep is could be a death now in terms of number of people that are playing so at any given time. Well, isn't it harder in mobile because they're live service? And are there modes that have I mean, isn't it the same game for most of those games? Like you It's not like there were sequels. Well, even with League, I guess they patched it o over time. I don't know. I can't think of a way cuz Candy Crush or some of the classics are the same game.

Oh, no. They've changed dramatically. Like you go back and play early like Candy Crush, remember there used to be stars that you would earn? There was this whole idea of score.
Yeah. Yeah. Yeah,
like the game. I don't think people have understood how much like match like when when Mitch Lasky and Blake Robbins go on and talk about like static match. I think people just need to understand like you see it underneath the hood when you go back and play these original versions of the game. Like if you get stuck on a plane, which I did when I was traveling, [laughter] let's go Euros Summer. # Euros Summer. Uh play Bejeweled on like your headrest and you're like, "Holy shit." You can see how they they have lineage and evolve.
Got it. But to your point, like there's no monetization in this. That's the thing though, like this could be LTV negative because you can, from what I understand, take your champions that you already own into the mode if you have one of the six they're launching with. It looks like you can carry over some skins. I'm not sure what the connection is to run, the small gameplay element that League of Legends has. I know that's reset. I don't know if there's new paid progression that's tied to it. Like this is a concern on like FIFA

Ultimate Team. Are they playing the LTB maximizing mode? Are they playing Ultimate Team? which I'm sure they'll talk about. Like you want to funnel them into the things that make money. And I'm not sure this makes money yet. Like subscribers is easy, right?
Yeah. I I think Riot's monetization is like Fortnite. When you have the massive amount of audience and you have a cosmetic economy, these are the only ones that can work. You know, these are the two companies that have figured out how to have this type of revenue work with this type of massive audience. And so I imagine if they can bring the audience back and they can still continue to offer the different skins for the characters that people love, they'll find a way to monetize. You know, the LTV is likely lower for these players. But if they can get people back, that's probably the goal. All right, Phil, let's talk about who is winning the World Cup besides likely Spain, which at least in my poll or my whatever, that's who I have winning the World Cup. Oh my god, it's such a good

game yesterday [laughter] and a good game today. So, we record Wednesday morning, so we don't yet know the outcome of the biggest rivalry in all of sports, England and Argentina. It's going to be huge.
The game was awful. [laughter] Oh, man. I was like, why why did I stay up to midnight? I thought it was terrible. I like Spain Spain is like they don't allow France to get any flow. Anyways, all right. So, we got E Football, we have FC Mobile. What What's like going on? because we haven't talked a lot about sports games and the I think interesting thing the last time we talked about e- football is that they unify their platform across mobile and HD. So even though the games have different progression inventories they're using the common tech stack and they've been remarkably successful since then. So right now we're looking at the revenue for the last 12 weeks and during the World Cup period, E Football is up 31%. And you're seeing FC Mobile up by 27% versus the prior 34 days cuz we're 34 days into the World Cup. And so this

is exactly what we've seen in prior World Cups. Like you can really grab it by the coattails and ride it. There are other games that have been trying to do this. I work with a couple as well. Uh, I don't have also Dream League Soccer on here, but I still think it's been remarkable to see what you can do with this as a marketing vehicle. Like, it's exactly what we talk about. These events do drive people into the experience. I've been surprised that I don't see more mobile games being advertised, especially with FIFA's license. Like, I'm surprised they wouldn't get advertiser space. Like, we're still being crowded out by basically sports books.
Absolutely none of these execution is the letters Fifa in them. Like that is a crime, right? That FIFA cannot capitalize on all this activity around their
event on interactive. It's unbelievable how poorly they
You can play it on Netflix.
Yeah, exactly. With that [laughter] piece of company

Well, there's the mythical thing, right? Or do they do
Oh, there is the mythical web 3ish game.
Yeah, exactly.
Which isn't on here.
Exactly. [laughter] But so Phil, I wanted to ask you I think I was reading some of these articles about E Football's growth. Isn't most of it in Japan though? Like is it is it Yeah, it's not necessarily like a US or Western growth.
But again, like I don't I think that's a really important point to make. And I would say the same thing like remember there's FC online 4 like people need to remember FC online 4 FC online 3 they are the Asian versions of FC and they do significant business Asia is a huge growth portal for football and soccer like they have to be managed and so like when you think about a lot of these football games getting those particular licenses is a huge unlock and of course like Japan some of the highest spenders in the world like we've seen the crazy LTVs that they produce and so it's a It's just a really smart strategy. Why not?

I just want to double down on Chris what you just said is does EA feel better about itself than right now that they didn't do the FIFA renewal license? You know, especially they're like we we we don't need you. If E Football is doing great in Japan, I think isn't it because like Japan also had like an an insanely great ride in the World Cup as well? Like you just don't need this. As somebody who loves IP, it is so damaging. It hurts my heart to say FIFA isn't a brand that matters, right?
Clearly not. [laughter]
I mean,
I think it was either Blake or Mitch had made on Twitter is like, what's the one thing everyone knows about FIFA around the world? What's the one thing everyone can agree on?
That they're corrupt as
Exactly. That that is exactly right, Eric. And unprompted, I didn't even pass you the note for the episode. Right. And so that's something that I think damages there's like an economic value that I think is harmed by that being the case.

They've never been able to beat the beat the allegations. They they aren't helping themselves.
Well, because they are corrupt as right?
They are. [laughter] Especially as someone who had to buy a ticket to go to a game in the US. I mean, it was thousands of dollars for a first round game in LA. It was like insane the cost of these tickets. And we c couldn't be more upset at FIFA than at that moment in time. All right.
There's one more chart that I thought was interesting which was looking at the increase in revenue for a particular country when we compare their prior time series after and before a match. So are they spending more money after they're in a match when we look at for example where they end up doing in the matches. And so one thing you'll notice is that there's a sharp increase in revenue versus the prior couple weeks as we get closer and closer to the finals, which I

think is interesting. So basically more of these countries are monetizing. And it's interesting. We don't see like a huge pattern on whether or not you lose or win increasing spend. Like your spend just seems to be up.
Isn't that crazy? A a realworld event pulling people into a game. It's almost as if I talk about these things all the time. It just happens to be a sporting event.
Here we go. Cross media, [laughter]
franchise, franchise management, content outside the game, driving to the game.
No, no, he goes back to the live ops idea. Remember the the butt of live ops, right? Is that there's no one who's going like more ultra local live ops. Like give me the push notifications at halftime. People are checking their phones. I've seen this on football games. I have worked on I can validate this
that there's increases in PSU or the simultaneous players online at halftime they're checking their phone build something towards that remember we talked about the halftime show with Clash of Clans but it didn't actually premiere at halftime like do ultra local

live ops
yeah I did a project for the German football league and when we were looking at the numbers the numbers for all of their products at the beginning of the season and at the end of the season were typically the highest because that's when You're ramping up your excitement about the start of the season and about the finals. Like all of this relates and it's just something to learn from. Agreed. Anything else on World Cup, Phil? Who do you think is going to win?
Um, who cares? It's all corrupt. [laughter]
Come on.
You know what? America wins. That's who the real winner of the World Cup is.
Uh, [laughter]
oh my god.
I think it's I think it's Norwegian Airlines and British Airlines. Did you see the that they made the bet and because Norwegian Airlines lost, they changed the logo to British Airways on all of their stuff. I think World Peace comes out of the World Cup. Everyone seems to get along better.
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All right. We didn't cover this. I thought this deserved to be covered, which is the launch of Pokemon Champions. So, Pokemon like what the most valuable IP in the world by any

measure. They have been very strict in who they license the title to. If you remember, like now Scopi holds it because they also hold Pokémon Go. And if you remember, they just they spun out part of the I think the location stuff or they rebranded the studio.
Yeah, Scopely Explorer, something like that. I don't know. I I heard it the other day, but I might be getting that wrong.
Pikmin's been uh chip chipping up too a little bit, piping piping up in terms of revenue. And so the the other thing we can do is we kind of say, okay, let's take this game and compare it to recent Pokemon launches. If you remember, there's Pokemon Go, of course. We can compare that by day since launch. There's CCG Pocket. Remember, it's the card game that's actually been struggling. There's Masters, which no one talks about anymore. This was the DNA game. Unite was from Timmy. No one talks about that anymore, but remember that absolutely smashed in terms of downloads. That was the MOA. You can play as Poke Pikachu. They're still at it. They've not given up on that game. Like even in even in China, it doesn't do well. And then there's Sleep. And

that's actually been the Sleeper hit I keep talking about. 150 million lifetime. Like a very unique core loop. And so where does this game stack up in terms of those titles? Well, it's it's pretty much straight at the bottom. It is awful in terms of what it's done in terms of monetization. If you remember, the original Pokemon card game actually didn't really have monetization in it at all, the mobile version. TCG Pocket was the first one to introduce that. And so, they've been very hesitant to think about stronger forms of monetization. Even like it's taken time for Pokémon Go to to introduce stronger forms of like gotcha based monetization. This game has basically one IP you can make, which is the battle pass. Other than that, it's cosmetic based. Even though that they have power progression, it is the exact same thing you would imagine when you played Pokemon Stadium. If you remember that as a kid, Pokemon Stadium is when you battle Pokemon together. They basically made that exact core gameplay here.
I'm just disappointed again that this is what Nintendo can give us in terms of monetization. [laughter]
It like prevents the growth of their franchises. I want to spend money here

and my experience is materially worse that I can't. This is what TCG Pocket proves. Like TCG Pocket stripped away core gameplay and basically made it a gotacha simulator, but they can't really get the core gameplay right. They stripped the TCG Pocket gameplay quite a bit. And here they finally have core gameplay. It's PvP battles training your Pokemon, but they can't get the outer monization layer right.
Who's the developer? The Pokemon works and the development studio is ILCA in collaboration with Game Freak.
Okay,
they have a Switch version, just FYI. Like, we don't know those numbers. So, who knows what
Switch for Pokemon can actually do stuff. That's not a that's not irrelevant here. But again, no monetization cap.
The only thing you can guess say here is that if the game blows up, then they'll turn on the monization funnel. like this has been the the 10-centent playbook.
Maybe that's the playbook they want to run here, but more more likely I think they just
they're this is made by Pokemon Company.

It's made Game Freak is Pokemon Company. They just don't have that kind of
like experience, right? Like
experience or desire to monetize it in that
maybe mobile's just a nice to have and they're focusing on the Switch queue from a strategy perspect.
I'm actually a little bit surprised that they would do this at all because, you know, it's just basically competing against the Switch SK, you know, because it's the same.
Yeah, because you get it free, right? like it's a freetoplay game,
but yeah, they're it up. But speaking of it up, [laughter] on the complete opposite side of it up, EA reverse this decision. So on College Football 2027, they put in these insane, egregious monetization modes [laughter] in in their game. And so like I got I got the deep dive on this by someone that is really an expert in this. So like I'm I'm I'm almost overwhelmed with the information that he provided. So I'm going to keep it as simple as possible, right? So basically what they did was they allowed for paid progression in the single player mode, right? But instead

of actually implementing in a way that made sense, they basically implemented it in a way that made the core progression without paying much more difficult in the game. And this was, I think, the second biggest sin. But the biggest sin was the fact that they didn't tell anybody [laughter] and they also didn't tell their influencers. It wasn't even in the preview build that the influencers were there touting, right? And so they basically them their own influencers up by trying to kind of sneak the in at release, right? And the influencers went nuts, right? Absolutely nuts. and they basically just came out and completely spoke out about the game and then they just created this insane controversy and then unfortunately for [clears throat] EA it got national attention because it was in the New York Times, right? And so anyway, clearly the marketing team up. I I have to imagine this is a pure marketing

problem. Um but again, there's two sins. One is that they didn't communicate it effectively and they kind of like threw their influencers under the bus to some degree and the influencers fought back. And the second was the way they designed it and that's a little the more complicated of it is that they basically put it into an existing system that made the core progression of the actual game more difficult rather than creating a separate system that would be on top of the core progression perhaps. So the example I gave was like Diablo, right? Diablo Immortal, their monetization design was primarily at the endgame when they add this gem system as opposed to actually integrating it within the core progression fantasy of Diablo, right? Anyway, so I don't want to get too deep into this but again, if they had actually communicated this ahead of time, it probably would have been far less damaging, but they ended up pulling it completely and just apologizing profusely. And it it's been a PR disaster for EA, which ironically EA has

not been in the news at all since this deal with the Saudis because I think they're waiting for the deal to close. But this is not the type of thing you want.
This [laughter] is not
in the end of end of the transaction closing. So,
a few other stats on how bad this was. The boycott hit number nine on the US trends. Steam reviews went mostly negative and EA obviously uh it only took him a couple days to reverse this. I guess that that that is a good thing. And so dear EA, is there a reason why you didn't learn from the Battlefront 2 loot box fiasco? I guess
because that was November of 2017. I imagine you didn't because you know we all know turnover is a thing, but we all know that leaders and executives at EA have been there for a long time. So, you know, Battlefront 2's monetization was actually visible in the October 2017 open beta. Players revolted anyway because again, when you have a premium skew, it does change things. So, just to go back and remind ourselves because I

do want to compare this to back in the day cuz it was also EA. So, it was a I don't know $60 to $80 game where the hero unlocks Darth Vader and Luke and stat boosting star cards sat behind loot boxes making multiplayer Phil pay to win after purchase. EA's community team went on and they defended it on Reddit with a sense of pride and accomplishment. This was like tonedeaf. It became the most downvoted comment in Reddit history. Past 600,000 down votes. A Guinness World Record. This is how bad it was in the history of EA comms and marketing. And they still kind of basically did the same thing. So EA ended up pulling all the microtransaction hours before the November 17th global launch. So this actually didn't even make it out because it was it was so horrifically reviewed in the early stages. And Crush will love this. These are the numbers that I pulled. Roughly three billion in market value wiped over the following weeks. The stock fell 8.5% monthtodate. UK first week physical sales dropped 61%

versus the 2015 Battlefield and the game hit 9 million units against a 10 million target.
A little bit difference here. This is a beloved like IP of Star Wars. It was a competitive multiplayer in which you're basically pay to win, right? The thing is that this is a single player mode, right? So like
yeah,
this shouldn't be so controversial. And on top of it, if you look at NBA 2K, they've been doing this for years and years and years and it was egregious and they actually did the same design thing back then and there was a huge backlash, but that's like their biggest mode now, right? So, it's like there is precedent here and that's why the Star Wars thing is a comp for EA, but it's not really a comp for what they tried to do. I just want to be clear on that. Yeah, the single player mode became almost impossible to progress unless you pay in NBA 2K. And this was the design that they were seem to be going after with this football game,
college football.
But again, I think it was more the communication and theing like bait and switch they did with the

influences that really like and that's why it's a marketing thing. It's not a game design thing is basically what I think I'm trying to get across here.
I think it's a combination. And so I think number one is
it's marketing. It's marketing, right?
The concealment is what made this feel like a betrayal. So I think you're absolutely right. You cannot burn the exact creators that you in some cases you pay in some cases you just bring in out of goodwill to sell the game. The transparency was never going to be the the whole fix in my mind. But you know it's the fact that you surprised this the surprised monetization is what carried the risk over kind of what happened in 17 where they actually showcased it. Right? So this is where your influencers become your loudest critics. Remember when Supercell Ilka didn't credit one of the creators for the success of Clash Royale? You cannot piss these people off because they will come after you with pitchforks and just ruin your day. So the speed of reversal I think is the real tell that this was

going to stop the bleeding. So I think that that was a good move. But I think the monetization piece that I want to talk about is that while maybe it happens in NBA, I don't know if all of the same people play that game. that's also a 2K game. So, introducing that into EA into a single player mode feels like a risk, especially when you think about in FC like foot people FIFA Ultimate Team is a different mode where there's monetization. So, is there precedent for this in an EA game? And if there isn't, then they should have spent a lot of time introducing that to people, explaining what that takes, like testing it. So, I don't think that it is purely a marketing problem. I think it's the way that they introduced and designed the monetization into the EA games that didn't normally have it in a single player mode that if you're a consumer and you spend 80 bucks on a game or seven, I don't know what this game will cost and it hasn't been there

before and it was one of the most successful games last year. remember we were all talking about how that skew paired with Madden was one of the biggest things ever and they just like messed with it
two years ago. Okay. Okay.
For FIFA, the primary monetization is Ultimate Team, right? And not the single player, right? For NBA 2K, it's flipped, right? So the single player is far more of the bigger monetization than Ultimate Team. So that's why their focus has been primarily on figuring out ways NBA 2K to optimize monetization on that side. For football, they're trying to replicate that, you know, with with the single player mode. What I'm trying to say is that I don't think it it's as controversial as it should be. It's a single player mode, right? Like it's like, you know, you're just paying to progress faster, right? And ultimately again the challenge is that you're paying to progress faster but but progressing without paying is impossible. That but that's what I mean that's
that's the design though and
but that's the that's like I mean listen

I blame marketing I yes but I also think like so let's get monetization zar in here to comment.
Yeah Phil you're an expert. You tell me what the wrong here. Well, it's I'm I'm so glad you guys asked because I have a model I have a model we can go through and this is someone someone who came to EA in the wake of Battlefront 2 and like was trying to figure out what are the lessons from Battlefront 2 because I don't think they're as clear as you're making them out to be. Like people threw out things like, "Oh, there was power progression." Okay. Well, FIFA Ultimate Team has power progression, right? You can pay to get characters. They're in packs. Those characters have OVR, which just makes you better off, right? It just makes you stronger and more powerful. That's a competitive game, too. How is it that FIFA is able to monetize in that way and yet their struggles when we talk about these modes? And just to clarify, remember there are two modes that were affected in NCAA football. One was you had the coach mode, you had the dynasty mode where you could use the paid points to

upgrade your coach progression. So, it doesn't look like they changed system design. It just was a paid entry point into that mode if you didn't want to do the normal pay to progress. It was like a very clean implementation. And the other one, Road to Glory, was a little bit different. It's supposed to be a quick mode, but you get about $100 for maxing out a coach is what I heard, which was according to one report. So, it wasn't as much as you would expect. And they did Titan Systems Design like they had a way for you to accumulate more XP that you could do as you go through the dynasty modes in case you basically wanted autoplay to be on. They didn't used to charge for that, but they limited your ability to customize that and they actually added back XP sliders for that. It looks like they got their hand in their cookie jar when you do things like this. I think that's part of the problem when you think about your public response is if you start apologizing like the first thing a lawyer will tell you when you get into an accident is don't apologize because apologies immediately imply guilt. And that's why like I talk about this gunpowder model. And what I suggest to developers is the way to think about like monetization and the concerns that

people on the internet have is to think about the idea that you have agency over what you might call this like this this kind of barrel. And the barrel can be full of things like okay are there loot boxes? Is there paid progression? Like the things you have agency over in the design are ultimately things that potentially could explode, right? you have agency over whether or not those are in designs. And so like if we think about NCA football including paid monization even into a single player game adds quite a bit of gunpowder, right? And you already know that there's existing hate against EA. So the audience is primed. That's like one of the things that goes into the gunpowder model. Like if you are Valve, you basically don't have to pay a lot of gunpowder tax. You can be much more aggressive just as they do. And so you have agency over this gunpowder. You got to think about how much gunpowder you want to put in there. The thing you don't know that I have here is the explosion. You don't know if the community is going to ride against this and whether or not it's going to amount to anything. That to me is extremely

uncertain. Like there's unfor it's a black swan event almost whether or not these things explode. Battlefront 2 was a very particular crisis, right? There have been other examples since which have not had the negative reaction. We've had even firstperson shooters bring back loot boxes and that doesn't seem to be an issue in some titles. So it's not always clear to me that this particular combination is going to cause backlash. It's really about what are the things that could cause backlash and do these things end up producing an explosion? What is the blast radius of that? That's how I would explain it to most developers. And so like you know what your developer profile is like for instance if you're mi hoyo if you're mi hoyo you don't carry as much risk because you're an eastern developer. You don't have as much track record which is how I think Genchin Impact is able to not have the monetization backlash. There's genre expectations. There's a lot of things that goes into this gunpowder.
Yeah. Yeah. I agree. But this is where I absolutely agree with Crest is if you're going to do this, you spend a lot of time very early talking to your community, explaining to them why you

are doing what you're doing with monetization. You show them what's inside the barrel to your analogy and then you help walk them through why this is not necessarily a bad thing.
I don't necessarily agree with that. I think sometimes you just need to make decisions that they're not always going to love. Sometimes prices have to increase. They don't always love you. Sometimes you got to make Scopely tightened system design in almost all of their products and saw increases in monetization. That was the Scopely system design playbook. I mean, the Walking Dead subreddit had like hate on Scopely Thursdays where they Okay. Okay. That's different. That's different. Hold on. Let me Let's pull back this a little bit. Like Scopley is a completely different animal, right? Because they are all free to play. This is a premium game. This is a $70 game. And so you have to consider
gunpowder. That is the gunpowder that I think I think put puts
you can't start throwing out like Javier and Scopely monetizing the out of every single employ, you know, customer the way they do. [laughter] That's
I had to deal I had to deal with spending strikes. So that that is a

completely different topic. Yeah. I want to get back to Phil like specifically why did they add these types of monetization features into a premium game when they hadn't been there before? What were they hoping to achieve? Guess Crest would like to answer this question.
As I said the lasting five sentences of last week, the only solution that these big publishers have is monetization at this stage. Right? If your audience is completely fixed and the games you can release are limited to the franchises that exist basically in this new world order of our beautiful industry, the only way is to monetize per user. And that's the problem is like I don't object to the idea of what they're trying to do. I just don't think they did it the good
I agree with you. I 100% agree with that statement is that that they didn't do this in the right way. Let's take one of the monetization changes, which you could now use paid points, right? Paid points that you would normally use to buy packs. You can use in the Dynasty

edition to upgrade coach points.
Well, I would ask why we would do it that way. Like
to make money, we definitely need to make more money. That's that's always the goal.
Is that the only way to make money? Like could it have been a new mode like foot that they created that would have gone had monetization separately?
This is you're you're going into the product. No, no. This is the turkey that's been delivered. You got to sell this. What is the PR? Because you guys say it's the marketing. It's not the fact that it's the marketing. What is the comms that solves this? Is there one?
That's kind of my point is you can't just hand something to to marketing and be like, "Oh, just change the way you talk about it. It'll make it okay." That doesn't always happen. It goes back to the beginning of developing these together. Is what is the audience going to say about these? What do we know about the market fit? What do we know about the competitive set that's going to allow us to talk about this? I do agree that they should have been more transparent and talked to their audience in advance of this or else, you know, we would have been where we are. But I also

think that some of the blame for this falls on product and picking a monetization model that might not have been the best for this type of premium experience.
You don't know if this is I mean this can make a ton of money. We don't know.
Well, it's not now cuz they turned it off two days after it launched.
That's completely fair. But at the end of the day, like they are basically looking at this like we were talking about platform economics. I make arpoo rpoo per hour played in this mode and when people play this mode I make rpoo per hour that is like a bajillion% less make me make more rpoo per hour in other mode. That's the equation they're trying to maximize. Like this was always the FUT problem, right? Is like how do we how do we funnel people into FUT because it's the highest RPO per hour. All roads lead to FUT, baby. Like right now if I give you rewards in the single player road, let's give them FUT packs, right? Let's get them into FUT. And this this actually reduces the pressure into FUT, right? like this widens your monetization base.
I get that there's logic and I get that there's like, oh, this makes sense on paper, but what a lot of times monetization people or product people

don't realize is that there's someone on the other end of that controller who is like you. This has never been my experience with this game ever in the past. [laughter]
Why did this happen?
Okay. Anyway, like let's wrap it and get to our last story, which is again complaining about the players behind the console.
There's big hubbub on the internet about Sony's decision to remove discs from circulation basically in 2028. So, this is the quote from the press release at Sony. As consumers preferences and broader entertainment industries continue to shift away from physical disc to digital, physical game disc production for all new games releasing on PlayStation console will be discontinued starting in January 2028. Following this date, new games will be available on PlayStation Store and at retailers in digital formats only. This transition has no impact on games that are already released or will be releasing prior to January 2028 in this format. So, this is their thing. So, to be clear, I think there's some

misunderstanding here, but for the most part, it's just a bunch of gaming people that are like complaining about this.
You will still be able to get a jewel box with the code at retail. Like I
my understanding is that Walmart and Target and Best Buy will still be selling games. That is not the issue here. And GameStop, right? The issue is that you will not have physical medium associated with it like CDs, etc. So I want to clarify that because I think there was some misunder understanding of that. But these things always typ typically get the enthusiast feedback, right? The blowback, you know, but it ignores the reality of the situation that in is that the people that are complaining about this not having disc are likely not even the ones that are buying discs to begin with, right? It's like the IGN folks are out there bitching and moaning about the ability to like collect things like you know ownership of theing media whatever and then two sentence later they're saying I haven't bought a physical copy

in likeing five years right it's like anyway so the people that actually buy physical discs are not the ones that are bitching about this particular change honestly I don't think anybody really gives a whether they get a disc or a code right again you can still buy the fancy package edge with the key art, you know, at retail, right? And the reality is that the discs itself are almost useless, right? They're just a means of installing the game anyway. Like you put that disc in there and it downloads some of the data that's on the disc, but the majority of it downloading it from the internet anyway, right? So, you need access to the internet in order to play these games anyway. Nothing's really on that disc anymore since PlayStation one people. This is the as okay we're talking about. You have never owned a game in your goddamn lives. All of you, right? Anybody who's bitching about this, you are technically renting this. This has been in the ULA since the PlayStation one era, right? You don't own So, you got to get over

yourself, right? On the ULA itself, end of life risk. If Sony or a publisher shuts down servers or dellists the title, your license baby effectively worthless even though you still hold on to this piece of disc. Okay, so anyway, I think people just got to get over themelves, right? Like this is this is the world in which we live. It is going to be digital. And the other thing I talked to Sony about recently is that the thing that makes it easier for Sony and other hardware guys is that the capability of putting in a disc creates all kinds of costs associated with the console. There are licensing costs, Dolby costs, obviously the reader, the all the manufacturing pieces of this. Like there's so many hidden costs associated with allowing for this disc that it will actually eliminate a lot of the costs associated with these these platforms on the hardware side. So this is good for the industry. It may be bad for GameStop. It may be bad for used trade, but like shit's over.
You know who else it's good for? The

memes. [laughter]
So, first is like, oh my god, the French guy running for government did this post and it was so stupid. It was like, I'm going to take this up as a campaign issue trying to like play to the five people who care about this. And then the Domino's post was like super super brilliant talking about like not shipping physical pizzas or something. So, we threw those up on the on the screen, but I wanted to bring a little data and stats to the emotional players who want to cradle their treasured copy of Spider-Man in their arms. I bet they also want their Blackberry back with the buttons. And by the way, is there anyone under the age of 35 on the 200,000 people who have signed the stupid petition list? Can you tell how I feel about this? So, digital is effectively one across every platform. By the way, when's the last time anyone bought a DVD for a movie? I just can't even believe the people complaining about this who like don't look at their own lives. So, here's some stats. PlayStation hit 85% digital last quarter ending March of 26 with physical down to just 15%. The full

year averaged to 78%. So, that's only Sony. Here is a stat. US physical game spending fell to 1.5 billion in 2025, the lowest since 1995, down 87% from 2008. And that's a Circana number. Now Nintendo is different like you know it's a kids it's like you gifting and so they're at 50 like 55% digital and the disc and Crest's favorite I love this one Crest the Xbox Series S because they don't have a disc. They drove 75% of Xbox sales according to GameSpot on that one. So obviously those people don't care about a disc. And then by the way PC and mobile are 100% digital through Steam and the app stores. Like when's the last time? Am I complaining that I don't own my Royal Match game because it's digitally on my around 96% of the 201 billion dollar global market is now digital once you blend all of these platforms together. Looking at Nuzu. So

Crest discs are mice nuts. Now I I bet there's going to be some sort of fake box at digital like you're saying at retail. So, you go to retail so that you can walk in and grandma can buy you a disc of your Call of Duty at holiday because they still think there's something in it. We talked about this with, you know, GTA. Uh, I used to spend months and months and months on that pretty key art. So, nothing's actually going away there, but you're just going to get that slip of paper and it's all going to be okay. It's going to be okay. I promise we'll let you cradle that box with a pretty Spider-Man picture. But I I just I don't understand why the world is is going up in [clears throat] our like Phil thoughts. Do you care?
Well, hold on. I thought we were just talking about monetization and like bowing to the crowds. I mean, shouldn't Sony just like look why would they want increased margins?
Why why could Sony [laughter] want increased margins? How could they how could they want it? Like the internet's pushing back. How how dare they look at this is always what the bull works the

steam bull works like the people who have the bomb shelters want the neck beards like they always want physical media for some reason it's very bizarre to me
this has always been the case I mean look there's been a there's been an in or increase in vinyl you remember seeing vinyl sales actually increase and I think it overtook CD sales recently true so there's there's something to that there's something to cartridges like what was the one that Palmer Lucky has come out with the retro mod like there is something to I think nostalgia physical technical media, but this this will go out. The margins will increase. I think this is good for everyone. To your point, like Eric, you can do a download code. Like people forget that Candy Crush does do download codes. A key part of Roblox's story is being able to use cash to be able to buy one of those cards, the cards that you can activate in store as a way to access
gift card. Yeah.
Yeah. And I think I think that sometimes that's been under reportported particularly for younger audiences, but you can still have that pathway through download codes now or QR codes, whatever it may be. So, there's literally no excuse anymore. I don't know what to say. Like, it ain't happening.

All right. Well, good to have you back, Phil. That wraps it for this week. And see the three positive the two of you. [laughter]
I know. I think we're going to have to end every episode with like what's good in the world because I think this was a a particularly [laughter] negative one at the end. All right, I'll see you guys next week.
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