V2.21 Patch Notes |

FEBRUARY 2021 REPORT REDDIT, TIKTOK AND MORE

V2.21 PATCH NOTES |

IMAGE: WALL STREET JOURNAL BIG TAKEAWAYS PAGE 3 A quick summary of what stood out to us

TABLE OF TRENDING PAGE 4 Trends we saw in the past month and the impact we expect them to have

BRAND ACTIVATIONS PAGE 9 Interesting activations from some nonendemic brands

OTHER IMPORTANTS PAGE 12 A hodgepodge of information from data to missteps

PAGE 2 BIG TAKEAWAYS

GameStop fans show up in unprecedented ways during Wall Street showdown.

TikTok content creators are giving games tremendous exposure and, as a result, new users.

Gaming brands are ﬁnding new ways to help gamers beyond the worlds of gaming. FEB 2021 Large companies continue to gobble up smaller game FEB 2021 creators in search of exclusive content. IMAGE: WALL STREET JOURNAL FEB 2021 FEB 2021

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TRENDING NO.001 SECTION

WHAT’S INCLUDED A collection of new and interesting things that caught our attention last month.

IMAGE: MAX-O-MATIC GAMESTOP GOES TO THE MOON

IMAGE: CNBC WHAT HAPPENED The subreddit r/WallStreetBets started a rollercoaster of retail WHY IT MATTERS

investing in GameStop stock. The initial excitement behind GameStop The rise of GameStop's stock dominated the conversation on social media started with a small group of investors who viewed the stock as for well over 48 hours. Reports are suggesting that 9% of Americans bought undervalued, citing many of the moves GameStop was making like shares of GameStop during the surge. In a matter of days we saw 001 the Tulsa test stores, a new focus on omnichannel offerings and new celebrities commenting on the situation, congresspeople discussing it on NO. board members. They also saw that GameStop's stock was massively Twitch, late night talk show hosts and even SNL weighing in. It became the shorted by large hedge funds on Wall Street. Seeing both the classic David vs. Goliath tale. But in this case, GameStop wasn’t David or opportunity to stand up for the brand they cared for as well as turn a Goliath. It was the rock. And because of the moves it had made so far, it proﬁt in the process, they began what is known as a “short squeeze,” was seen as a rock worth throwing. Even as the stock price has come back buying up stock, which drove the share price higher while putting down, there is a renewed sense of energy and enthusiasm in the brand as pressure on the hedge funds who had short positions. The result was fans and gamers eagerly await to see what moves GameStop will continue a global phenomenon that made headlines just about everywhere. to make in the future. TRENDING PAGE 5 IMAGE: ELON MUSK THE ASSAULT OF ACQUISITIONS

WHAT HAPPENED WHY IT MATTERS There have been several major acquisitions in the gaming industry over the last few weeks. EA led the way by purchasing racing game developer These acquisitions signal a couple of trends that are currently happening in the gaming industry. The Codemasters and mobile game developer Glu Mobile. The acquisitions will ﬁrst is the battle for content. We have seen something similar playing out between streaming cost EA roughly $3.3 billion. Embracer Group, based in Sweden, went on a services. Streaming services are spending millions for exclusive rights to shows like Seinfeld and shopping spree highlighted by Gearbox Entertainment for $1.378 billion. They Friends. With more subscription models popping up in the gaming industry we expect acquisitions also acquired mobile game developer Easybrain and Aspyr who specialize in will become more common. However, consolidation doesn't always work out well for the end porting games. Microsoft, after acquiring ZeniMax late last year, created a consumer. Smaller, independent studios have traditionally been more willing to take risks and push new subsidiary called Vault. The acquisitions may not be done either. Rumors the industry forward creatively. Hopefully, these studios being acquired can maintain some of that are swirling that Take-Two and Tencent are looking to add new studios to independence. The second trend is the realization that innovation in gaming is critical, but often the their lineup. most expensive. Some of these larger companies have chosen to identify smaller brands doing really interesting things and acquiring them versus spending several years and millions of dollars to hopefully reach the same outcome.

IMAGE: EA NO. TRENDING 002 IMAGE: TAKE-TWO INTERACTIVE IMAGE: WARFRAME

PAGE 6 TIKTOK PROPELS HIGH HEELS!

WHAT HAPPENED A mobile game about walking in high heels has found its way to the top of the downloads chart in the App Store and Google Play Store. High Heels! is developed by Rollic which was acquired by Zynga in 2020. Its popularity has been largely driven by TikTok. It started with a basic ad campaign running on TikTok, but the app's users began making content of their own. Clips from the game uploaded by TikTok users are garnering millions of views and likes as High Heels! has remained at the top of the download charts for several days now.

WHY IT MATTERS

We feel conﬁdent in saying that High Heels! likely won’t become the next Fortnite. The real lesson from this story is the impact of TikTok, which has already caused products to sell out on Amazon and songs to go to No. 1 on Spotify. Because of its unique ability to layer fan content onto existing assets, it could be the perfect place for fans to share and enhance their gaming clips. 003

There is a huge opportunity for game developers and content creators to get in front of a new NO.

audience willing to take action. TikTok's unique algorithm does a great job of exposing you to relevant content based on past engagement. Interacting with a large gaming creator on the platform could lead to the discovery of similar creators or content. We expect developers and publishers to create (or bolster) their TikTok strategies as the platform continues to shine.

TRENDING

IMAGE: ZYNGA PAGE 5 ALSO NOTEWORTHY 07. Epic Games spends $95M on new HQ Epic Games just announced that it has reached an agreement to purchase Cary Towne Center in Cary, ALSO NOTEWORTHY North Carolina, and plans to turn the location into its ALSO NOTEWORTHY new headquarters by 2024. 08. WB games to focus on live service Games currently in the works at Warner Bros.’ own studios will be supported months and years after launch with new content, recurring events and, likely, microtransactions.

09. EA Sports going back to college After last making a college football game in 2013, EA Sports vice president told ESPN it will be IMAGE: QUAZ30 SKETCHFAB returning to the space with EA Sports College Football, a move that fans applauded soon after. 04. CD Projekt Red hit by cyber attack CD Projekt Red is the latest game company to be hit by a cyber attack. The hacker’s note threatens to release source code for Cyberpunk 2077, The Witcher 3 and Gwent, as well as release company documents.

05. Amazon isn’t done making video games The incoming CEO is committed to Amazon’s video game IMAGE: TWITCH development efforts despite challenges. AGS might have the support of Amazon’s next CEO, but it’s got a long way to go if it wants to earn the support of players.

06. TheGrefg breaks Twitch record TheGrefg smashed the concurrent record on Twitch, with more than 2 million live viewers tuning in to watch him reveal his Icon Series Fortnite skin — a series reserved for the game’s top creators, including Ninja. IMAGE: EA SPORTS

BRAND ACTIVATIONS NO.002 SECTION

WHAT’S INCLUDED Nonendemic brands that decided to get in on the esports action last month.

IMAGE: RAZER RAZER IS TAKING ON COVID-19 WITH ITS NEW N95 MASK

ACTIVATION NO. 001

WHAT HAPPENED IMAGE:RAZER Normally we cover nonendemic brands attempting to break into the gaming category. This month however, we’re doing the opposite. Razer is WHY IT MATTERS once again dipping its toes into waters beyond gaming with Project Hazel Razer has dabbled in spaces outside of gaming with experiments like chewing gum, LED credit cards and the N95 face mask, which was introduced at CES earlier this year and and a futuristic gamer chair. And while not all of these innovations will make it to mass production, it labeled as “the world's smartest mask.” Razer has already produced over shows the company’s willingness to expand beyond it’s typical offering. Razer understands that a million standard masks to help combat COVID-19. This new iteration is gamers do more than just game and also that gaming and gaming culture is constantly evolving. Not taking things to the next level as it will include futuristic features like only could this open up new revenue streams for them, but if nothing else it shows gamers that it voice-ampliﬁcation, RGB lights and low-light mode in addition to more cares about them as people and not just gamers, looking for ways to improve their lives in general and traditional ventilators. not just in gaming. PAGE 10 OTHER BRAND ACTIVATIONS

7-ELEVEN REDESIGNED ONE OF THEIR STORES FOR GAMING A 7-Eleven in Dallas, Texas, was redesigned with a gaming aesthetic in mind. Eligible customers will be able to book the room for $11 which grants access to a PS5 and a streaming session with FaZeTemperrr.

NO. 002

IMAGE: OTTERBOX

OTTERBOX LAUNCHES GAMING ACCESSORIES Otterbox is adding a line of rugged Xbox accessories, a NO. 003 big shift for the brand that has focused primarily on more rugged mobile phone gear. The move makes sense considering how quickly mobile gaming is expanding. IMAGE: 7-ELEVEN

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OTHER IMPORTANTS NO.003 SECTION

WHAT’S INCLUDED The other things we didn’t think deserved their own section but do deserve your attention.

IMAGE: NINTENDO MISSTEPS HERE ARE SOME THINGS THAT DIDN’T QUITE GO AS PLANNED LAST MONTH.

Google locks out developer More problems for Avengers

Please reenter your password. 11 million bugs at launch will do that.

35 CS:GO players banned Twitch PogChamp rollout issues

Did you learn nothing from Pete Rose? Turns out when your face is an emote, people know who to harass.

IMAGE: OMEGA JONES

PAGE 13 IMAGE: 505 GAMES POPULAR GAMES VIEWED PLAYED TWITCH, YOUTUBE ( HOURS VIEWED M) PC (PLAYER SHARE)

RUST - 197.0 MINECRAFT - 19.3% LEAGUE OF LEGENDS - 179.0 LEAGUE OF LEGENDS - 16.5% FORTNITE - 121.0 CS:GO - 13.3% MINECRAFT - 115.0 COD MODERN WARFARE - 12.5% ESCAPE FROM TARKOV - 112.0 GRAND THEFT AUTO V - 11.3%

GENRE MOBILE PC (PLAYER SHARE) APPLE, GOOGLE (MONTHLY USERS M) ADVENTURE - 55.0% SUBWAY SURFERS - 403.7 SHOOTER - 46.0% HILL CLIMB RACING - 209.2 BATTLE ROYALE - 26.4% TEMPLE RUN 2 - 163.5 ROLE PLAYING - 25.1% MY TALKING TOM - 145.2 BATTLE ARENA - 20.5% AMONG US - 121.8

SOURCE: NEWZOO JANUARY DATA IMAGE: MY TALKING TOM TWITCH TOTAL TWITCH PEAK POPULAR CHANNELS TOTAL HOURS VIEWED (M) PEAK VIEWERS (THOUSANDS)

XQCOW - 25.0 THEGREFG - 857 AURONPLAY - 14.5 TOMMYINNIT - 650 GAMESDONEQUICK - 13.2 AURONPLAY - 295 THEGREFG - 12.9 LEC - 250 HASANABI - 11.2 WINSTRIKE_TV - 235

YOUTUBE TOTAL YOUTUBE PEAK TOTAL HOURS VIEWED (M) PEAK VIEWERS (THOUSANDS)

MBL LEGENDS: BANG BANG - 9.6 TECHNOBLADE - 841 MRSTIVEN TC - 5.1 FREE FIRE BRASIL - 443 VALKYRAE - 4.8 MBL LEGENDS: BANG BANG IND - 415 GYAN GAMING - 4.5 MBL LEGENDS: BANG BANG - 388 DJMARIIO - 4.3 PUBG MOBILE IND - 358

SOURCE: NEWZOO JANUARY DATA IMAGE: FORTNITE ON THE HORIZON

CONGRESSIONAL HEARING After all of the commotion created by the showdown between WallStreetBets and hedge funds, there will be a number of congressional hearings taking place, starting on February 18. NEW NINTENDO SWITCH COLOR With the release of the new Super Mario 3D, Nintendo is also dropping a new color of Switch with the Mario Red & Blue Edition. BETHESDA’S INDIANA JONES GAME Who doesn’t love watching the beloved archaeologist navigate his way through mazes and enemies to ﬁnd treasure? Well according to Bethesda’s recent teaser, we may soon be able to play him.

PAGE 16 THANK YOU THANK YOU THANK YOU