OUR STRATEGY AND BUSINESS MODEL DEVELOPING OUR BUSINESS TO ACHIEVE REPEATABLE SUCCESS

We invest our development resources in games with strong franchise potential. In order to maximise the return on our core skills and assets we target game genres where we have established expertise and intellectual property.

How we create and nurture our franchises

CREATE BUILDING PLAYER NURTURE Frontier uses experience gained Frontier avoids ‘pay-to-win’ features, from a track record in the games NUMBERS AND instead continuing to expand each industry over three decades to ENGAGEMENT franchise offering through an ongoing create franchises that build on our program of free and paid-for world-class expertise. expansions and add-ons HIGH QUALITY BOOST PLAYER EXPERIENCE INNOVATIVE EXPERIENCES INCREASING AWARENESS

We continue to invest in our organisation Our development process uses our proprietary a level more appropriate to the local economy, to create a model of repeatable success. COBRA development tools and technology as we did with Planet Coaster in China in To accelerate our progress and increase to facilitate innovative features and the February 2017. In particular we note the the frequency of launches we are scaling creation of top quality self-published games growing Chinese market for premium PC up our organisation, not just in terms of staff with strong differentiation for the PC and games. Importantly, the recent strategic numbers, but also in terms of leadership skills, console audiences. Our control of this investment in our business by Tencent will training, organisational structure and process. technology also removes risk related to allow us to more easily take advantage of ongoing access to third party licensed their unparalleled expertise and distribution We are also investing in facilities. It is our technology alternatives, risk relating to capabilities in their home market for belief that having all our people in Cambridge ability to fix uncovered problems in that our franchises. working together in a single building will technology and lack of control over the maximise our operational effectiveness delivery dates and feature roadmap of such Major new releases will be key drivers of and efficiency, and in spring 2018 we will solutions. It also facilitates rapid response revenue. Because of the small number of achieve this when we move into new office to market opportunities like support for franchises and relatively infrequent major space on the Cambridge Science Park. virtual reality and augmented reality. releases Frontier is currently able to make, revenue is sensitive to the specific schedule Our development focus is on PC and console We continue to assess the distribution of such releases and may therefore exhibit titles, as together these segments represent channels and platforms we use to achieve ‘stepped’ behaviour, as those new franchises the majority of the available market by revenue an optimal addressable audience for each are released. In the future, as we successfully and generally the audiences on these game, and the monetisation strategy for scale the number and frequency of franchise platforms have valued games that exhibit each franchise. We participate in price releases, annual revenue growth should Frontier’s key development strengths. promotions on each of the distribution accelerate and our dependency on each platforms we use for each of our games as major release should decrease. We use online channels to create and engage appropriate to its life-cycle stage, allowing with a fan-base or community during game us to reach the widest possible audience. development, which provides a valuable source of feedback and an enthusiastic We also monitor the geographical performance community for each franchise before of our franchises and will continue to look first release. for opportunities to tailor our local price to

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CREATING AND MANAGING FRANCHISES

In order to maximise the return on our core potential, and plan for strong post-launch review potential acquisition targets that skills and assets we target game genres on PC franchise support to further help realise could augment our capacity or add new and console platforms where we believe we this potential. capabilities as well as IP that may help can both i) deliver high quality, differentiated us achieve our goals. offerings using our established expertise and We will continue to grow the capacity and intellectual property, and ii) have a strong capability of our organisation in both commercial We will endeavour to enhance and expand chance of successful market entry, based on and development areas in order to further our franchises and grow their audiences using past experience or knowledge of that sector. the successful evolution of our franchises. appropriate additional products, platforms, media, marketing, distribution channels and We use this repeatable model to invest As part of this process, we will explore charging models through investing in the our resources with the intention of creating potential partnerships and licensing necessary people, organisation, resources world-class games with strong franchise opportunities. We will also continue to and infrastructure.

evolution

ELITE DANGEROUS PLANET COASTER JURASSIC WORLD EVOLUTION Continuing to blaze a trail Redefining a popular genre Building our own Jurassic World

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FUTURE FRANCHISES

We are already scaling up for the future All future franchises will be selected using review all possibilities to determine the so we can release new games more frequently the same approach described above that was optimum strategy for each franchise on a whilst continuing to develop our existing used for Elite Dangerous, Planet Coaster case-by-case basis. We are building a broad franchises. As well as Jurassic World Evolution and Jurassic World Evolution. The use of portfolio of franchises, each different to the being in full production we are in the early external IP in Jurassic World Evolution does last, and each with the capabilities to expand stages of planning our next two, as yet not imply that this will be the case for all over time, as we have already seen with unannounced franchises. our future franchises; we will continue to Elite Dangerous and Planet Coaster.

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CONTINUING TO BLAZE A TRAIL

Elite Dangerous is now in its third year of Having the base game and Horizons seasons full release. We have continued to release of expansions in the market covers mid-price expansions in the Elite Dangerous: Horizons entry to the franchise with an upgrade path, season, and corresponding updates to the and we bundle the two together with in-game original Elite Dangerous game, simultaneously digital items to create a Deluxe edition for a on both PC and Xbox One platforms following premium price point entry. We believe each the launch of Horizons on Xbox One in product in the franchise offers great value, June 2016. and our further in-game monetisation avoids ‘pay-to-win’ game mechanics. Simultaneous releases on all supported platforms is planned to continue going forward, The Elite Dangerous franchise continues to including Sony’s PlayStation 4 following the perform strongly and we continue to focus franchise’s debut on the platform in June 2017, on enhancements within the strategy of after the end of the fi nancial year, which further improving perceived quality and signifi cantly expanded its addressable audience. sentiment, adding signifi cant long-term new features and supporting the unique These updates add to the quality of the game, evolving player-driven story, which all renew the interest of existing players, and players experience together. We expect also generate additional coverage resulting to further expand the player base over in new sales. The attach rate of Elite Dangerous: the next fi nancial year, adding new Horizons to the base game continues to content and increasing the audience. grow steadily, helped by the regular updates.

The Horizons season of expansions Each expansion offers new headline gameplay features 2.0 2.1 plus a large number of quality of life and other tweaks, fi xes and improvements, and there is an accompanying PLANETARY THE ENGINEERS ‘1.x’ update to the base game. LANDINGS MAY 2016 (PC), DECEMBER 2015 JUNE 2016 (XBOX ONE) The release of 2.4 ‘The Return’ will complete the Horizons Expanded gameplay Added loot and crafting mechanics season of expansions. Horizons will continue to be sold as to planetary surfaces to the game to allow players a substantial expansion product with all content available for the fi rst time. to upgrade the performance at the time of purchase. of their ship and weapons.

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2.2 2.3 2.4 THE GUARDIANS THE COMMANDERS THE RETURN FUTURE OCTOBER 2016 APRIL 2017 SEPTEMBER 2017 DEVELOPMENT Expanded the gameplay Offered the ability for multiple Supports the ongoing story ONGOING possibilities of each ship by players to crew a ship and arc related to Thargoids, the We have announced that adding ship-launched fi ghters. represented player characters franchise’s fi rst alien species, and the ‘season pass’ business in game with sophisticated their interactions with humans model will be superseded by an customisation options. in the Elite Dangerous galaxy. alternative after the release of 2.4 The Return.

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REDEFINING A POPULAR GENRE

Planet Coaster was successfully launched in November 2016 after a short Beta period, achieving the global #1 position on the Steam distribution channel and continuing to sell strongly through the subsequent holiday period.

In accordance with our strategy we began to release free updates, each of which add headline features but also expand and improve different creative and management aspects of the game.

This update strategy is intended to further improve perceived quality and sentiment by adding signifi cant long-term new features. Such updates add to the quality of the game, renew the interest of existing players, and also generate additional coverage resulting in new sales.

Continued expansion after a successful launch In addition to major free expansions, in July 2017 we 1.1 1.2 released our fi rst paid downloadable content (PDLC) for Planet Coaster. As with Elite Dangerous, this follows an WINTER UPDATE SPRING UPDATE in-game monetisation model that avoids ‘pay-to-win’ DECEMBER 2016 APRIL 2017 mechanics. We will continue to expand Planet Coaster’s In addition to new rides being Added security guard staff PDLC offering, as we have with Elite Dangerous. added, there were further members and go-karts tracked improvements to streamline rides for players to use in their We believe Planet Coaster offers great value at its current management operations within parks, along with more rides, price-point and we anticipate franchise revenue over parks, new scenarios, new shops, coasters, scenarios and further multiple years, similar to that seen with our RollerCoaster new transport rides and a new management improvements, as Tycoon 3 game from 2004 in the same genre. snowy winter theme. well as doubling the maximum size of blueprints that can be FRONTIER DEVELOPMENTS PLC shared via Steam workshop to 10 ANNUAL REPORT AND ACCOUNTS 2017 4,000 pieces. STRATEGIC REPORT

1.3 1.33 1.38 SUMMER UPDATE PAID DLC SPOOKY PACK JUNE 2017 JULY 2017 SEPTEMBER 2017 Added customisable fi rework Released our fi rst paid A new pack to Planet Coaster and a new entertainer, the displays and video billboards downloadable content (PDLC). that adds a host of Spooky- spooky pack gives Planet for players to place in their As with Elite, this follows an themed content. With everything Coaster players even more parks, as well as more rides, in-game monetisation model from scenery pieces, new rides, freedom to create and share coasters, scenarios and further that avoids ‘pay-to-win’ mechanics. special effects, animatronics, awe-inspiring parks. management improvements We will continue to expand plus a new Stars and Stripes Planet Coaster’s PDLC offering, scenery set. as we have with Elite Dangerous. FRONTIER DEVELOPMENTS PLC ANNUAL REPORT AND ACCOUNTS 2017 11 OUR FRANCHISES CONTINUED

evolution BUILDING OUR OWN JURASSIC WORLD

Our third franchise, Jurassic World Evolution, operations on the legendary islands of Isla was identifi ed using the same approach Nublar and the surrounding islands of the described above that we used for Elite Muertes Archipelago. Players will create Dangerous and Planet Coaster. Our original and manage their own Jurassic World as concept for Jurassic World Evolution would they bioengineer new dinosaur breeds, leverage our management and builder game and construct attractions, containment and expertise, plus our unrivalled expertise research facilities. Every choice leads to a implementing believable in-game animals different path, and spectacular challenges from games such as Dog’s Life, Kinectimals arise when ‘life fi nds a way.’ and Zoo Tycoon. In this case we felt that being able to use the Jurassic World IP Jurassic World Evolution will be Frontier’s would signifi cantly benefi t awareness with fi rst self-published title (although not our the next fi lm in the franchise to be released fi rst game) to debut on PC, PlayStation and in June 2018, around the 25th anniversary Xbox simultaneously, and the fi rst to benefi t of the original Jurassic Park fi lm. from such major marketing events in 2018 as the celebration of 25 years of Jurassic Jurassic World Evolution was announced in Park and the launch of the next fi lm in the August 2017, for PC, Xbox One and PlayStation 4 franchise, Jurassic World: Fallen Kingdom. and will be released in summer 2018. We will reveal more details about Jurassic Jurassic World Evolution evolves players’ World Evolution at FrontierExpo in London relationship with the Jurassic World fi lm in October 2017, our fi rst community event franchise, placing them in control of dedicated to all of Frontier’s franchises.

About Jurassic World: Fallen Kingdom With all of the wonder, adventure and thrills synonymous with one Pratt and Howard are joined by co-stars James Cromwell, Ted Levine, of the most popular and successful franchises in cinema history, Justice Smith, Geraldine Chaplin, Daniella Pineda, Toby Jones, Rafe Spall, this all-new motion-picture event sees the return of favourite characters while Jake Johnson, BD Wong and Jeff Goldblum reprise their roles. and dinosaurs – along with new breeds more awe-inspiring and terrifying than ever before. Welcome to Jurassic World: Fallen Kingdom. Directed by J.A. Bayona (The Impossible), the epic action-adventure is written by Jurassic World’s director, Trevorrow, and its co-writer, Stars Chris Pratt and Bryce Dallas Howard return alongside executive Derek Connolly. Producers Frank Marshall and Pat Crowley once again producers Steven Spielberg and Colin Trevorrow for Universal Pictures partner with Spielberg and Trevorrow in leading the team of fi lmmakers and Amblin Entertainment’s Jurassic World: Fallen Kingdom. for this stunning instalment. Belén Atienza joins the team as a producer.

WWW.JURASSICWORLD.COM

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