The Global Games Market: Trends, Market Data and Opportunities PeterWarman Peter Warman | CEO & Co-Founder | Newzoo 10 September 2015 © 2014 Newzoo The Global Games Market: Trends, Market Data and Opportunities PeterWarman Peter Warman | CEO & Co-Founder | Newzoo The Global Games Market: Trends, Market Data and Opportunities Peter Warman | CEO & Co-Founder | Newzoo What’s Special? What’s Special? $1.2M Per Player is Prize Pool $16M Was Crowd the same as the $18M Funded by $2.50 2014 World Cup of every $10.00 3rd Place Prize donation, making Money. Winning Team Valve $54M $6M New Direct Esports-Related Revenue Streams NEW CONSUMERS NEW RULES NEW METRICS ARE PRODUCERS FOR SUCCESS NEEDED? TAKE A STEP BACK FROM THE BIG DATA ANALYTICS SOUP NOW AND AGAIN…… NEWWHO? THESE COMPANIES CURRENTLY SUBSCRIBE TO NEWZOO’S SERVICES Newzoo. The Experts On All Things Games. Newzoo is an innovative global market research firm with a primary focus on games. We provide our clients with a mix of consumer research, transactional data and financial analysis across all continents, screens and business models. We aim to be ahead the curve when it comes to global and local trends and always put hard data into a broader perspective. MARKET TRENDS | CONSUMER INSIGHTS | DATA MODELING | PREDICTIVE ANALYTICS SAN FRANCISCO AMSTERDAM SHANGHAI MOBILE MARKET INTELLIGENCE BY NEWZOO & TALKINGDATA HISTORIC MARKET MARKET CONSUMER PLATFORM GAME/APP PREDICTIVE TRENDING TRENDS SIZING INSIGHTS DATA METRICS ANALYTICS JOINT AMBITION the full suite, on a global scale MODELING & QUANTIFYING TRENDS Esports Economy Growth TAKEN FROM NEWZOO’S 2015 GLOBAL GROWTH OF ESPORTS REPORT ESPORT ECONOMY MATURING GLOBAL NUMBER OF CONSUMER ENGAGED BY ESPORTS | 2015 & GROWTH TOWARDS 2017 © 2015 Newzoo | Source: Global Growth of Esports Report Premium Revenues 2015 | Esports| Global, NAM , APAC 37% GLOBAL 34% $252M +30% YoY NAM APAC $93.2M $85.2M +32% YoY 29% +28% YoY © 2015 Newzoo TOWARDS A $1BN ESPORTS ECONOMY REVENUES PER ESPORTS FAN COMPARED TO THOSE OF SPORTS SHOWS POTENTIAL © 2015 Newzoo | Source: Global Growth of Esports Report Premium 2014 Revenues/Fan Esports Growth Scenarios Global Revenues Divided by Fans Based On Annual Revenue per Enthusiast All $3.0Bn Sports Alternative Optimistic TOTAL ESPORTS $56 REVENUES $15 Scenario $1.1Bn Individual Sports $1Bn $7 $5 Report AVERAGE $20 REVENUE PER Scenario ENTHUSIAST $3$3 $1.0Bn Repucom $2 $2 $0.5Bn © 2015 Newzoo / Newzoo © 2015 Esports © 2015 Newzoo / Repucom $2 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 CONFIDENTIAL | LIMELIGHT BREAKFAST AUGUST 6TH 2015 A MACRO VIEW Monitoring Global Growth TAKEN FROM NEWZOO’S 2015 GLOBAL GAMES MARKET REPORT CHINA AND THE US NECK-AND-NECK 2015 GAME REVENUES PER REGION 2015 GAME REVENUES PER SCREEN / SEGMENT © 2015 Newzoo TOP COUNTRIES BY MOBILE REVENUE 2015 Rank Country Revenues 1 China $6,500,940,064 11 Russia $336,402,000 2 Japan $6,183,574,320 12 Brazil $318,936,912 3 USA $6,015,517,552 13 Mexico $298,498,290 4 South Korea $1,849,657,577 14 Italy $298,265,226 5 United Kingdom $1,008,778,581 15 Spain $228,657,173 6 Germany $819,296,319 16 India $227,456,546 7 France $519,746,699 17 Turkey $205,203,435 8 Australia $517,988,650 18 Thailand $172,011,071 9 Canada $507,126,131 19 Indonesia $167,899,403 10 Taiwan $412,829,571 20 Hong Kong $160,117,567 Top 3 Fastest Growing Countries: India Indonesia Philippines +75% CAGR +72% CAGR +63% CAGR Source: Newzoo Global Games Market Report 2015 THE STANDARD FOR GAMES MARKET SIZING Newzoo’s Global Games Market Report SPOTTING THE SPENDERS Free Riders versus Big Spenders TAKEN FROM NEWZOO’S 2015 COUNTRY CONSUMER INSIGHTS DOES TIME SPEND DEFINE A POWER USER? MOBILE GAME SPENDERS AND NON-SPENDERS VS TIME SPEND Time Spend Clearly © 2014 Newzoo | Source: Newzoo Data Explorer Correlates with Share of TIME SPEND All Share That Spenders. Still There Are Mobile Spends Non- Gamers Money Spenders Spenders ALL 119.9M 43.2% 51.9M 68.0M < 3HRS / WEEK 76.9M 36.0% 27.7M 49.2M 4.7M 3 – 10 HRS / WEEK 31.4M 54.8% 17.2M 14.2M Free Riders That Play A Lot But Never Spend > 10 HRS / WEEK 11.7M 59.8% 7.0M 4.7M SINGLE COUNTRY SCOPE: US 4.7M “Free Riders” A Potential Marketing Target Group? © 2015 Newzoo CONFIDENTIAL | GLOBAL TOP ROUND EVENT 2015 DOES MONEY SPEND DEFINE A POWER USER? LEVEL OF MOBILE GAME SPENDING VS TIME SPEND In the US, There Are © 2014 Newzoo | Source: Newzoo Data Explorer All Minor Average Big Spenders Spenders Spenders Spenders MONEY SPEND 4.2M ALL 51.9M 31.2M 16.4M 4.2M Big Spenders That Spend < 3HRS / WEEK 27.7M 20.9M 5.6M 1.2M A Lot of Money But Not 3 – 10 HRS / WEEK 17.2M 8.5M 7.8M 0.8M All Spend A Lot Of Time. > 10 HRS / WEEK 7.0M 1.9M 2.9M 2.2M SINGLE COUNTRY SCOPE: US 4.2M “Big Spenders” The Prime Sales Target Group? © 2015 Newzoo CONFIDENTIAL | GLOBAL TOP ROUND EVENT 2015 DOES MONEY SPEND DEFINE A POWER USER? LEVEL OF MOBILE GAME SPENDING VS TIME SPEND The Big Spenders, 3.5% © 2014 Newzoo | Source: Newzoo Data Explorer of All Mobile Gamers, All Minor Average Big Generated at Least Spenders Spenders Spenders Spenders $1.7Bn in 2014, or MONEY SPEND ALL 51.9M 31.2M 16.4M 4.2M < 3HRS / WEEK 27.7M 20.9M 5.6M 1.2M 33% 3 – 10 HRS / WEEK 17.2M 8.5M 7.8M 0.8M of All Revenues > 10 HRS / WEEK 7.0M 1.9M 2.9M 2.2M SINGLE COUNTRY SCOPE: US 4.2M “Big Spenders” The Prime Sales Target Group? © 2015 Newzoo CONFIDENTIAL | GLOBAL TOP ROUND EVENT 2015 WHO ARE THESE POWER USERS? TIME VERSUS MONEY SPEND ANALYSIS OF MOBILE GAMERS IN THE US Of US Big Spenders, A © 2014 Newzoo | Source: Newzoo Data Explorer Dominant Free Riders Big Spenders FEMALE MALE FEMALE MALE 65% 35% 38% 62% 30% MALE 21-35 MALE 21-35 12% 30% Is Male Between 21 and 35 4.7M 4.2M (Typical Game Enthusiasts) vs 12% for the Free Riders. SINGLE COUNTRY SCOPE: US © 2015 Newzoo CONFIDENTIAL | GLOBAL TOP ROUND EVENT 2015 THE BIG SPENDER IS A FAMILY MAN HOME SITUATION: FREE RIDING VERSUS BIG SPENDING POWER USERS © 2014 Newzoo | Source: Newzoo Data Explorer Of All Mobile Big Spenders in the US, Free Riders Big Spenders NON-FAMILY FAMILY NON-FAMILY FAMILY 43% 57% 33% 67% PARENTS PARENTS 52% 34% 52% 4.7M 4.2M Have Children at Home versus 34% for Free Riders. SINGLE COUNTRY SCOPE: US © 2015 Newzoo CONFIDENTIAL | GLOBAL TOP ROUND EVENT 2015 THE BIG SPENDER HAS A FULL-TIME JOB FREE RIDING VERSUS BIG SPENDING POWER USERS © 2014 Newzoo | Source: Newzoo Data Explorer Of All Mobile Big Spenders in the US, Free Riders Big Spenders NON-WORKING WORKING NON-WORKING WORKING 60% 40% 29% 71% FULLTIME JOB FULLTIME JOB 61% 26% 61% 4.7M 4.2M Have a Full-Time Job versus 26% for Free Riders SINGLE COUNTRY SCOPE: US © 2015 Newzoo CONFIDENTIAL | GLOBAL TOP ROUND EVENT 2015 THE BIG SPENDER SPENDS ON ALL SCREENS FREE RIDING VERSUS BIG SPENDING POWER USERS © 2014 Newzoo | Source: Newzoo Data Explorer Of All Mobile Big Spenders in the US, TV (CONSOLE) PC / WEB BIG SPENDER BIG SPENDER 74% 73% 73% Also is a Big Spender on PC Gaming. 74% Also on Consoles. Total Wallet MOBILE BIG SPENDER Could Be $4bn. 4.2M SINGLE COUNTRY SCOPE: US © 2015 Newzoo TRACKING MOBILE IN CHINA Monitoring the Diverse Ecosystem TAKEN FROM NEWZOO’S MONTHLY CHINA MOBILE GAMES MONITOR PLATFORM TRACKING DATA IOS GAME REVENUES TRACKING OF 10M YOUTUBE & TWITCH IOS & GOOGLEPLAY IN 50 COUNTRIES PC GAMERS VIEWING DATA DOWNLOADS DATA ON A BILLION+ SMART DEVICES IN CHINA THE CHINESE MOBILE ECOSYTEM Apple Is China’s #1 Technology Brand by 2014 Revenues Historic performance of Western company in China revealed 2014 CALENDAR YEAR REVENUES AND PROFIT IN CHINA FOR KEY TECH BRANDS KEY FACTS © 2015 Newzoo year-on-year year-on-year Revenue Growth Profit Growth 2014 Revenues in China Full Calendar Year 2014 Profit in China +32.3% +54.1% Full Calendar Year for Apple for Apple in China in China NOTES All numbers related to calendar year 2014. Revenues and profits of companies with a different fiscal year have been calculated based on quarterly reports to ensure comparability. Apple numbers are based on reporting segment Greater China (incl. HongKong and Taiwan). Samsung numbers are based on reporting on segment “China”. Huawei numbers are based on articles in Forbes on March 31, 2015 and Wall Street Journal on January 13, 2015. Operating profit is assumed to be equal across all regions. Lenovo numbers are based on reporting segment “China”. Tencent numbers are based on reporting segment Mainland China. Operating profit is assumed to be equal across all regions. Xiaomi numbers are based on article in Wall Street Journal on November 5, 2014 and are total company revenues and operating profits (across all regions as segmentation is not public). Baidu numbers are total revenues and operating profits (across all regions as segmentation is not public). Except for Lenovo, USD amounts are calculated using exchange rates as per 31 December 2014. Source: Newzoo’s Global Games Market Report Premium & Free China Report Update | April 2015 www.newzoo.com ANDROID STORE PERFORMANCE REACH OF ANDROID STORES IN CHINA | JUNE 2015 App Store App Store Installs MAU MAU Ranking Change # of Installs (M) Activity Index (English) (Chinese) (Growth) (M) (Growth) 1 +1 360 Mobile Assistant 360手机助手 142.0 2.1% 112.1 3.4% 79% 2 -1 Myapp (Tencent) 腾讯应用宝 138.1 -1.8% 101.0 -3.6% 73% 3 +1 MIUI app store (Xiaomi) 小米应用商店 4 -1 Baidu Mobile Assistant 百度手机助手 CONFIDENTIAL 5 +2 Huawei App Store 华为应用市场 This data is part of the Newzoo/TalkingData monthly China Mobile Games Monitor.