lu-cix key facts and trends on the ever- changing global games market

The Bigger Picture

Peter Warman | CEO Newzoo | peter@newzoo.com Luxembourg, September 2012

Key Facts & Trends on the Ever-changing Global Games Market

© 2012 Newzoo www.newzoo.com

Yesterday in Luxembourg Taking distance and looking at the bigger picture…

Today in Luxembourg Sharing my findings & toughts on the total picture…

Today in Luxembourg Sharing my findings & toughts on the total picture…

players

time payers

money

© 2012 Newzoo

Today in Luxembourg Sharing my findings & toughts on the total picture…

players

time payers

money

© 2012 Newzoo

Key Trend

Key Trend

Key Trend

Key Trend

Luxembourg, here we are This place is about more than money….

players

time payers

money

© 2012 Newzoo

7

North America $20.7bn

+1% CAGR

Europe $21.3bn +3% CAGR

Latin America $5.4bn

+14% CAGR

Middle-East & Africa $1.4bn +21% CAGR

Asia-Pacific $19.3bn +13% CAGR

Total

$68bn +7% CAGR

Source: Newzoo 2012 Games Market Revenue Repor

Global Market Size 2012 | Regions Based on Financial & Consumer Data Analysis 2012 ($bn)

8

Mobile Devices $6.3bn

+32% CAGR

MMOs $11.6bn

+21% CAGR

Consoles $20.2

-2% CAGR

PC/Mac Download $8.1bn +2% CAGR

Casual Websites $7.7bn

-1% CAGR

PC/Mac Boxed $8.7bn -11% CAGR

Social Networks $5.5bn

+5% CAGR

Global Market Size 2012 | Segments Based on Financial & Consumer Data Analysis 2012 ($bn)

Total

$68bn +7% CAGR

Source: Newzoo 2012 Games Market Revenue Report

Breaking news: Kingdoms of Camelot Number one grossing iOS game in August*

Revenues aggregated from nine countries

Luxembourg, here we are This place is about more than money….

players

time payers

money

© 2012 Newzoo

Luxembourg, here we are This place is about more than money….

players

time payers

money

© 2012 Newzoo

*

* As aggreate of the UK, Germany, France, Netherlands and Belgium

Source: Newzoo 2012 Consumer Research / Newzoo Data Explorer

67.9M 54.3M 68.0M 35.1M 73.9M 74.7M

Only Boxed

Only Download

Both Boxed and Download

MMO

PC/Mac

Both Browser and Client

Only Browser

Only Client

44%

25%

31%

50% 34%

16%

Players per market segment | EU* % of online population (10-65) that plays games, per market segment

Casual Social

Mobile Console

Luxembourg, here we are This place is about more than money….

players

time payers

money

© 2012 Newzoo

Luxembourg, here we are This place is about more than money….

players

time payers

money

© 2012 Newzoo

Source: Newzoo 2012 Consumer Research / Infographic

Time Spend | Fastest Growing KPI Total number of hours spent on playing games | 2012 vs 2011

Time Spend | Fastest Growing KPI Total number of hours spent on playing games | 2012 vs 2011

Source: Newzoo 2012 Consumer Research / Infographic

North America Europe Asia-Pacific

Total*

$24.1

Total*

$24.8 Total*

$22.5

Regional Differences 2012 | Segments Total Gross Consumer Spending per Market Segment 2012 ($bn)

time time time

Source: Newzoo 2012 Games Market Revenue Report / Custom

* Depending on scope definitions. Numbers shown are maximum scope.

Luxembourg, here we are This place is about more than money….

players

time payers

money

© 2012 Newzoo

Luxembourg, here we are This place is about more than money….

players

time payers

money

© 2012 Newzoo

access

screens

Consumers vs Screens Newzoo Screen Segmentation Model TM

22% of US gamers (2012) play on all four screens

21% of EU gamers (2012) play on all four screens

market growth All Screens Connected By: • Social Networks • The Cloud • The Real World

*

* As aggreate of the UK, Germany, France, Netherlands and Belgium

The Computer Screen | 2012 | EU Newzoo Screen Segmentation Model TM

*

*

* As aggreate of the UK, Germany, France, Netherlands and Belgium

*

The Entertainment Screen | 2012 | EU Newzoo Screen Segmentation Model TM

*

* As aggreate of the UK, Germany, France, Netherlands and Belgium

*

The Personal Screen | 2012 | EU Newzoo Screen Segmentation Model TM

*

* As aggreate of the UK, Germany, France, Netherlands and Belgium

*

The Floating Screen | 2012 | EU Newzoo Screen Segmentation Model TM

Cross-screen Gaming | Franchises Newzoo Screen Segmentation Model TM

Luxembourg, here we are This place is about more than money….

players

time payers

money

© 2012 Newzoo

access

screens

Luxembourg, here we are This place is about more than money….

players

time payers

money

© 2012 Newzoo

access

screens

*

* As aggreate of the UK, Germany, France, Netherlands and Belgium

Source: Newzoo 2012 Consumer Research / Newzoo Data Explorer

18.2M 12.5M 21.8M 17.0M 43.4M 36.4M

Only Boxed

Only Download

Both Boxed and Download MMO PC/Mac

Both Browser and Client

Only Browser

Only Client

47%

18%

34%

55% 28%

17%

Paying Players per market segment | EU* % of players per market segment that spend money

Casual Social Mobile

Console

Luxembourg, here we are This place is about more than money….

players

time payers

money

© 2012 Newzoo

access

screens

Luxembourg, here we are This place is about more than money….

players

time payers

money

© 2012 Newzoo

access

screens

free

biz

z m

od

els

The Effect of Free-to-Play | Total US Market Stable total market, more paying gamers, lower average spending

31 Source: Newzoo 2012 Games Market Revenue Report / Custom

(Paying) Players Avg. Spend / Month

© 2012 Newzoo/Distimo – Strictly Confidential

The Effect of Free-to-Play | Mobile Games Continuous revenues | Infinity Blade vs Kingdoms of Camelot

© 2012 Newzoo/Distimo – Strictly Confidential

The Effect of Free-to-Play | Mobile Games Continuous revenues | Infinity Blade vs Kingdoms of Camelot

Luxembourg, here we are This place is about more than money….

players

time payers

money

© 2012 Newzoo

access

screens

free

biz

z m

od

els

Luxembourg, here we are This place is about more than money….

players

time payers

money

© 2012 Newzoo

access

screens

free

biz

z m

od

els

organisation

services

“free-to-play is not a business model but a way

to run your business” - Peter Warman, CEO Newzoo

Quote of the month Why big publishers struggle amidst all the change

Just check out how Star Wars the Old Republic was launched compared to League of Legends (Wikipedia)

The biggest games publisher in 2020… Managing big data,making big money

Luxembourg, here we are This place is about more than money….

players

time payers

money

© 2012 Newzoo

access

screens

free

biz

z m

od

els

organisation

services

pro

fit

valu

e

Luxembourg, here we are This place is about more than money….

© 2012 Newzoo

screens

access

bizz models

free

organisation

service

profit

value

Consumers want continuous access games that are, in principle, free. Ideally, their game continuously improves and expands, as a service. If the game gives them value, they have no problem to spend money.

Game companies need to make their games accessible via all screens as well as adapt their business models. The latter requires organisational change. Hard but it is the only way to remain profitable in this competitive market.

Luxembourg, here we are This place is about more than money….

players

time payers

money

© 2012 Newzoo

access

screens

free

biz

z m

od

els

organisation

services

pro

fit

valu

e

Newzoo Clients Across all continents and market segments

Newzoo Company Two complimentary lines of business

international partners

B2B Marketing Tools

business decisions

When you are surrounded by …

And you are seeking your …

In a world where everything is possible…

Look at the bigger picture now and again..

There will always be Consumers...

There will always be Screens...

People will always want to have Fun...

And everything (and everyone) will end up in the Cloud.

So Luxembourg. Prepare yourself.

And that is excatly what you’re doing.

The Bigger Picture

Peter Warman | CEO Newzoo | peter@newzoo.com Luxembourg, September 2012

Key Facts, Trends and Mechanics on the Ever-changing Global Games Market

© 2012 Newzoo www.newzoo.com