泥中蟠龍's Game愛歌
[A love song for games of the dragon waiting for an opportunity]
Waiting for rosy future of small and medium-sized game developers
I often look at mobile-game charts because of the nature of the job of an investor specializing in content including video games. Of course, I mostly examine top-grossing games rather than all subcategories. The everyday routine helps me to have strengths to confirm a considerable change in the industry very rapidly. But there is also a big drawback. It is easy to become insensitive the gradual change in trend. You probably don't notice minimal weight changes of a person whom you see every day, however, you can easily perceive the change of someone whom you haven't seen for a long time. Looking back on the previous year, I took a closer look at changes in the game rankings for the year at the end of last year. And I could identify the overall flow of the one-year variations. I'd like to talk about what I felt while looking at the changes in the sales ranking.
The salient point is a significant drop of 『For Kakao』 games. In January 2015, 『For Kakao』 games dominated high ranks of various game charts. However, current top-ranked 『For Kakao』 games, even though they are still not a few, have mostly serviced for a long time and the number has drastically decreased. And the majority of the games ranked high on the list now are not 『For Kakao』 games.
The next thing is that most upper-ranked games are being serviced by large-sized publishers. At this time last year, there were top-ranked games which were released directly by small and medium-sized developers. However, presently, apart from some foreign-developer-made games, it's hard to find high-ranked games made by domestic game studios. Fortunately for us, a few long-lasting local games remain among the top games.
This shows that the market continues to be upgraded based on its user data and massive marketing data. Furthermore, the influence of Kakao game platform has been reduced, which made the small and medium-sized game developers became harder to have good performance in the market with huge advertising costs. Also, the enormous costs are lowering the profitability of big publishers. In most industrial areas, rising distribution expenses including advertising costs tend to trigger large-scale distributors' direct manufacturing. In the gaming industry, like the others, big-sized publishers have a high possibility to change the way they do business, for example, direct development and having its affiliates. Or they can choose an area of concentration focusing on servicing of a few big games. Under these circumstances, smaller businesses would gradually lose their place. And this can also enable a vicious circle of cautious corporate investment and challenging production environment for smaller developers.
Like other megabusiness-centered industries in the past, the gaming industry would reduce challenges and streamline bulky organizations, and develop new growth engines investing in potential start-up companies. However, there will be difficult times for small and medium-sized game makers ahead for a while. It's time for them to need tenacity.
※ This is from Kyunghyang Games column by 泥中蟠龍 since September 2013.
(http://www.khgames.co.kr)
Translation by Kim Ki-hui
