Here’s why it’s hard to take a game from China to Europe

Patrick Streppel, head of IME, at ChinaJoy.

Disclosure: The organizers of ChinaJoy paid my way to Shanghai. Our coverage remains objective.

SHANGHAI — Lots of Chinese game companies are flooding out of China into the West. Patrick Streppel, chief executive of consulting live operations firm IME helps make that happen. But he sees a ton of problems that can trip up the Chinese publishers that try to do it themselves and do it too fast.

The mobile gaming market has become tough, since it is dominated by long-term hits such as Supercell’s Clash of Clans, King’s Candy Crush Saga, and Machine Zone’s Game of War: Fire Age.

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“Too many Chinese game developers spend money on marketing, not quality,” said Cai Cai, founder of Pine Capital, as she introduced Streppel for a talk at the ChinaJoy game trade show in Shanghai.

“I agree about the importance of the quality of games, the toughness of the market now, and the carefulness of investors and companies overall,” Streppel said. “I don’t think it is possible to just publish globally from one place, like Korea, China, or the U.S.”

“To go global, you have to be local because of the state of the competition,” said Streppel, former head of Gamigo.

Hamburg, Germany-based IME partners with game publishers in regions such as Western and Eastern Europe. Started two years ago, IME acts as a co-publisher, content agency, and consulting company for global free-to-play games. The company is a business-to-business operator, so it doesn’t put its own brand on games.

This freaking big mech was in a promiment position at ChinaJoy.

Above: This freaking big mech was in a prominent position at ChinaJoy.

Image Credit: Dean Takahashi

The company helps secure licenses and figures out where those licenses will work. The licenses can attract users, but sometimes a game company winds up with just 20 percent of the profits in a licensing deal.

In Europe, he said, “The good old days are over where it was very easy to get money and make money. Wargaming, Riot Games, Innogames, and GoodGame are growing. But a lot of companies that hit 150 million euros in revenue are declining and restructuring.

“The companies with a lot of titles are falling behind, and those with just a few are leading,” he said.

Streppel said he encourages companies to self-publish their titles. But investing in a team and a local subsidiary in major regions takes a lot of time and money. The cost of advertising to get new users is rising. There’s very little visibility into how well that advertising works, and it costs a lot of money to build the systems to verify it and prevent fraud.

“Maybe you are advertising on the wrong platform or others are cheating on you,” he said. “It costs money to find out.” A lot of money is being pumped into ads. Chinese companies are investing a lot in user acquisition, and not in a smart way. It drives up the advertising costs for everybody.”

And some advertising channels don’t work anymore. TV ads are less effective because fewer people watch them. Most people multitask when they watch TV these days, so the ads have less impact, Streppel said.

Another thing that makes the market tough are the media companies themselves, which create a big presence on Google related to key advertising words for games. Those media companies get more search engine optimization than the games themselves. So the game companies have to advertise with those media companies.

“Your traffic is diverted because they write content to claim the traffic,” Streppel said. “Then they call the publisher to advertise on the web site. You buy your own users back for money.”

Sony showed off a Chinese-made game at the front of its PlayStation booth at ChinaJoy 2015.

Above: Sony showed off a Chinese-made game at the front of its PlayStation booth at ChinaJoy 2015.

Image Credit: Dean Takahashi

Smaller companies have to create games with good key performance indicators, or those that measure growth.

“Platforms want good KPIs if they are going to feature you, but how can you prove good KPIs without a lot of users,” Streppel said. “It’s a chicken and egg problem.”

Ad networks hold more power in Europe now, and Streppel said that ‘s a problem. There are a ton of cloned games that are heavily advertised, but  those clones destroy consumer confidence and make the market tougher. Lifetime value (LTV) calculations are key to figuring out if a game is profitable or not, and how much a publisher can spend on advertising. But LTV is declining for the games that are not in the top tier.

To win users back, publishers are discounting heavily. But users are being trained by promotions such as Steam sales to expect discounts.

The mature markets are seeing tons of new game launches still. Some companies are fleeing to less crowded territories.

Publishers can expand into markets such as India or South America, but it’s hard to generate revenue in those markets because users spend less and don’t have as much disposable income.

“A lot of companies are fleeing to mobile, but that makes the situation worse,” Streppel said. “So you have to focus on game quality.”

Streppel also said that publishers should focus on customization, a small dedicated team, and retention of existing users. And that’s what his team specializes in.

VB’s research team is studying web-personalization… Chime in here, and we’ll share the results.



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Best Personal Cloud Hard Drive?

Question by kilroy024: Best Personal Cloud Hard Drive?
I have been researching Personal Cloud hardware. I seem to have narrowed it down to these three:
1) Western Digital My Book Live 2 TB Personal Cloud Storage Drive
2) Iomega® Home Media Network Hard Drive, Cloud Edition 2-TB
3) FreeAgent GoFlex Home – NAS server

I am leaning towards the Iomega as it seems to be the easiest to set up, more flexible with 2 usb connections and they get the best write-up from what I can see. My question is, are there any real users out there that have experience and recommendations on these three or even one not listed if you like it. I want to back up a MacBook Pro running Lion and a PC running Window’s 7 and control access to different folders for friends and relatives as well as having full access to all of my files remotely.

Looking forward to hearing your responses. Thank you in advance and I hope everyone has a wonderful Thanksgiving…………….

Greg
[email protected]

Best answer:

Answer by brandon
Let me start by saying that I have an Iomega (the non-cloud) version and I finally got it set up, which took some investigation for a novice like myself, but nothing too challenging, just intimidating and sometimes frustrating. When I got it up and running, it worked for PC where I was able drop all my storage onto the network drive. Perfect! Never tried to access the info outside the house. Then I got a macbook and realized that I now have limited storage, and NEED to access this info from outside the house so I don’t max out my drive with non-essential material (songs, photos (huge), short movies, etc.) the other stuff that the macbook air does so well. SO, I tried to hook up the Iomega NAS Home Networking Drive to work as advertised, outside my network and over the internet. (also I couldn’t access Apple Cloud backup through the device with Iomega claiming an update at some future point.)

When I got it up and running, I realized that I was able to access the home drive from anywhere with wi-fi, HOWEVER, it was necessary to access it through a web site and the information wouldn’t stream at all. It was like a big box, and anything that I wanted, I had to take out and drop (download) onto my computer. This is no good because I don’t want that stuff on my computer. It WILL get lost there.

I’m looking for something that creates a mapped drive wherever I access wi-fi so I will have the same accessibility as if I were sitting in my living room in my network. It would be akin to a portable USB hard drive but I only access it through wi-fi and never carry it around. I’m not sure that these exist. Maybe you can build one yourself, not sure. If anyone has any info about these or where to point me in the right direction, PLEASE let me know. ([email protected])

So after the clunky remote access on the Iomega Home Networking Device, I called Iomega. They said that the technology to remotely map the drive isn’t a part of the NAS drives, BUT they allow access through a general web browser. Upon further investigation, the best browser and interface for manipulating information between your computer and the NAS was from a company called Synology. The product that I was drawn to was the DS212J:

http://www.synology.com/products/product.php?product_name=DS212j&lang=us

It also includes a modest price increase from the Iomega or the WD. Also, it is not a all-in-one, key turn approach. You have to select the hard drives that you put into the computer (2 bays, up to 3 TB each). Besides that price and the physicality of putting in the drive, they will look rather similar.

TWO Major Differences:
1. With the two drives, you can use one to backup your data and one to save 3TB of material
a. Note this also works with Mac Time Machine for auto backups
2. The web interface used for accessing info remotely works much like a PC desktop in the window. So it is possible to manage all of the information you need right from your desktop. I.e. Add, drop, merge two folders, change the name of something.

Q: The unanswered questions that I have are:
1. Does it allow streaming to iTunes from the hard drive
– I know there is a streaming player built into the website to stream your songs, but I want to incorporate iTunes so I don’t get a bunch of (!)
2. Does it allow streaming access of pics through a program like Aperture. So I can save all my pics on the NAS and never have to worry about them (with the backup) yet access them through the simply organized Aperature wherever I go.
– Right now on my home network, this works out great. It just creates a small image of the larger photo file and brings it up for me to play with only when I click. When I’m done editing, it goes back to the NAS hard drive. I would love this remotely.

Another Plus about synology:
— They do have an app where you can stream any song from your home drive to your iPhone/ipad as long as there is wi-fi
— You can also adjust the folders on your iPhone/ipad the same way you can on the desktop if you need something in a hurry on the road, you can quickly change the document’s name from doc.1 to “Information on the Sub-Orbital Satellites: Junktown Street -Riots in Outerspace” and then send it away for example.

So in conclusion, all of the reviews I read suggested that Synology had by far the most intuitive, useful web interface for remote access.

Dunno about the streaming. Can’t wait until it will be just a hard drive icon on my computer that won’t work except for wi-fi to store all my stuff on as if it were right there.

Also, although I’ve been snooping around, I can’t find ANY information about where this personal cloud thing is headed… Seems most sites are still reviewing product that were released over 6 months ago.

Hope this helps,

If you want any more info or know where I can get more info – email me.

Thanks,

Brandon
[email protected]

Know better? Leave your own answer in the comments!

Is it possible to use an external hard drive sort of like a cloud server?

Question by KILLER_X: Is it possible to use an external hard drive sort of like a cloud server?
For example, if I take an external hard drive, and plug one USB input into one PC and a Firewire input into a Mac, if I drag a file from the PC into the external hard drive, will the file show up on the Mac in the external hard drive?

Best answer:

Answer by cypheron
That should work, but it might depend on the enclosure. If you really want a cloud, put it on the network as a NAS. Of course, if you’re not using buzz-speak, then it’s just a file server.

What do you think? Answer below!