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The Future of Monetization

The Future of Monetization. Daniel James CEO Three Rings daniel@threerings.net http://djames.org/gdc/. Premises. Ye olde crystal ball +10 Axe of Grinding Time in the Future Arrows in Back. The Ten Year Thesis. Virtual Currency FTW

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The Future of Monetization

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  1. The Future of Monetization Daniel James CEO Three Rings daniel@threerings.net http://djames.org/gdc/

  2. Premises • Ye olde crystal ball • +10 Axe of Grinding • Time in the Future • Arrows in Back

  3. The Ten Year Thesis • Virtual Currency FTW • Mix of virtual goods, subscriptions, trading and advertising or incentives • Social multi-player component • Often massively single-player • ‘Casual Games’ == ‘Core’ == ‘Industry’ • Bye bye Television

  4. Market Today • 'Casual' means 'Not Hardcore’ • Hardcore business is scuppered • 100M+ 'Casual Gamers' • Online game plays, DS, Wii dominate the attention landscape

  5. Dead Ends • Casual Games =/ $20 Downloadbles • $20 Download is Scuppered - Flat Sales • The competition is for attention • Downloadable channel an accident • Collapsing advertising market of 2001 • Popcap accidently rediscovered shareware • Billing channel was available via trymedia etc. • Did not present user registration issues • Most portals are not execution-oriented

  6. What will we sell? • Attention • If we don’t get their time, we’ve booched it • Enhanced experiences • items, levels, enhancements • Luxury goods, status • Creativity and services of other players

  7. Revenue Models • Advertising: selling attention to corporations • Sales force • Non-standard ad units -> biz dev custom deals • Highly cyclical • Games poor for measurable CPA/CPC sales • Other methods of selling your players • Behavioural data, privacy invasion, spyware • Surveys for in-game rewards • Lead generation: sign up for Netflix etc.

  8. Revenue Models (2) • Once-off sales • Converting 1% must only be a part of the answer • Subscriptions • Presents a cliff to the casual adopter • Under monetizes the enthusiast • Microtransactions / Virtual Currency • Secondary markets: • selling player attention and luxuries • Player-created content • selling player creativity to other players

  9. Virtual Currency is the enabler • Ties into the context of your game • Naturally supports all the revenue models • Reward structure for advertising and incentive schemes • Required for secondary markets and player created stuffs • Lacks a cliff • Facilitates ongoing free experience • Efficiently monetizes at every level of usage

  10. Payment Mechanisms • Credit Card / Paypal • SMS / Phone billing • Prepaid Card • Bank transfers • International remittances • Wallet platforms e.g. Google, Facebook

  11. Challenges • Infrastructure is lacking • *Still* not available as a service • Portals *still* cannot support user registrations or billing • Building is painful • Increases complexity • Gameplay accommodates currency • Trends towards complex, rich worlds

  12. Answers! • Most Portals disintermediated • Will not dominate the landscape in five years • 'New portals' being built around these trends • Billing services and platforms mature: • Mochiads • Peanut labs • Clickandbuy, Aria • Facebook wallet, Google, Paypal, etc. • Whirled, Metaplace, Kongregate • Even the console platforms! • A flood of innovation will change the landscape

  13. Q n A

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