Update: Top 10 Mobile Games Publishers WW November '10

Update #1 Nov 24 2010 @ 9:45pm: Based on feedback I've added Capcom to the list & moved Digital Chocolate up in the rankings, while moving Namco down a bit. I've elected to remove Artificial Life because only about 50% of their revenue can be attributed to mobile games. Please... I encourage more feedback in the interest of making this the definitive list.

--------------------------------------------------------------------------------------

• Note that I've added Chinese mobile powerhouse KongZhong to the list... in recent quarters mobile games have become a much more significant portion of the their overall revenue, which is about $145mil over the past 4 quarters.
• Purely from a mobile games perspective, it could be argued that both Artificial Life & Digital Chocolate don't belong on this list, but I'm keeping them here for the time being, while their primary businesses are still mobile games. If current trends persist, Digital Chocolate will quickly evolve into a company that primarily derives revenue from social online gaming (Facebook games).
• Per a previous suggestion from Jon Jordan over at PocketGamer.biz, I'm considering adding Disney/Tapulous to the Top 10... but I'd need some independent confirmation that their combined worldwide mobile games business yields at least 20 something million dollars.
• Overall I'd suggest that the Top 10 are becoming less significant in terms of their contribution to mobile gaming revenue and even in terms of real dollars I've dropped their aggregate revenue to $715mil from $720mil just 3mos ago.

Battle For So. Korea: GAMEVIL vs Com2uS Q3 2010

GAMEVIL

• Q3 sales were led by ZENONIA 3 & Baseball Superstars 2011 in the Korean market
• The company believes it can maintain high profit margins by focusing on franchises & virtual goods sales within games
• Aggressively pushing into smartphones & tablets (but figures not broken out)
• The company is preparing to release its first online social game by the end of the year

Com2uS

• Company didn't have a major title launch in Q3, due to a product delay
• Smartphone revenues (36.8% in quarter) are growing rapidly, but not fast enough to offset rapid decline of feature phone revenues (hmm, where have I heard that before?)
• Homerun Battle 3D continues to be a star, but Slice It is off to a strong start
• Company has reduced royalty costs by focusing more on original IP games

Top 10 Mobile Games Publishers WW August 2010

All numbers are for the most recent 4 quarters for which I have data, at today's exchange rates.

In terms of non-public, guesstimated data, I've moved Chillingo onto this list... due to their boffo performance in the AppStore (see related post)... I'll move them up or down based on community feedback. I've also let Namco slip a bit as the PacMan franchise seems to cooling a bit in the new retail channels. I still have D'Choc hanging on by a thread. Granted, they've rolled a lot of iOS titles, but none appear to be rockstars and their new emphasis on Facebook games is a bit of a tell, right? Do you guys think ngmoco should be on this list? Please, please let me know your thoughts.

Battle For So.Korea: GAMEVIL vs Com2uS Q2 2010

Enterprise Values of 22 Public Mobile Entertainment Companies Aug 2010

Update June '10: Enterprise Values of 21 Public Mobile Entertainment Cos Including Motricity

Updated Enterprise Values of 15 Public Mobile Entertainment Companies

What a difference a week makes. I'm already updating this spreadsheet with some new data. Here are some notable changes:

• Buongiorno posted Q1 2010 earnings
• Velti filed updated earnings with the SEC as part of their bid to go public on the NASDAQ (they're currently listed on LSE)... their numbers are pretty impressive (more on that soon)
• Mandalay Media, parent of Twistbox & AMV, changed its name to NeuMedia, Inc. & announced a notice of default related to a cash balance provision from a key creditor
• ROK Entertainment's stock is down over 50% today (guessing they'll be more news to follow). Btw - did y'all know the biggest shareholder in ROK is the DeJoria family, which controls the Paul Mitchell salon product empire? Always thought the guy in the ads was Paul Mitchell... but that's actually John Paul DeJoria (Mitchell was his founding partner). Anyhoo, probably hasn't been a great investment no matter how you cut & color it

Latest Enterprise Values of 15 Public Mobile Entertainment Companies

• Data for Velti & ROK Entertainment should be taken with a grain of salt, since they haven't released financials in recent quarters
• It looks like a couple of these companies should consider giving their cash back to the investors, and calling it a day. Some of them shouldn't be public at all (and are barely going concerns)
• I think the shining stars of this lot are the mobile games publishers Gameloft, GAMEVIL & Com2uS
• I look forward to adding Motricity into the mix, once (if?) they go public
• Let me know your thoughts on this and if there are any other public mobile entertainment companies I should be tracking

Top 10 Mobile Games Publishers WW February 2010

As always, let me know if I'm missing something or if you think I have incorrect data.

S. Korean Publisher GAMEVIL Is Hotter Than Gochujang

Seoul-based mobile games publisher GAMEVIL announced stellar earnings last week and I just gotta say that despite it being an unpopular choice *I called it* when I picked them as the Q4 revenue growth star in my recent poll (assuming no surprises from Artificial Life). Me and the other guy who voted for them are getting some crazy sick prizes, suckas! (a large boba tea and Rain's latest album).

The publicly traded company (063080.KQ) realized $7.95mil in Q4 revenue, which is a 54% gain over Q4 2008 and $4.08mil in net profit, which is 84% growth QonQ. For the full year 2009 their revenue and net were $21.33mil and $10.29mil respectively. In one year these guys have blown right past some original gaming gangstas like Capcom, I-play, THQ & Hands-On... and are gaining fast on their bigger South Korean competitor, Com2uS ($27.75mil 2009 revenue). The prominently placed line in their press release claiming they're “the first mobile game company in Korea to surpass 10 billion KRW in Net Profit” is clearly a dig at their cross-town rival (which had half GAMEVIL's profit). Actually GAMEVIL might be closer in size to Com2uS (as well as D'Choc & Artificial Life) than the numbers let on, because they only include a portion of the earnings from their profitable GAMEVIL USA, Inc. OpCo... which has 5 well received Paid titles (notably Baseball Superstars & ZENONIA) in the US App Store. For the following reasons I think these guys are really well positioned for growth...

• a powerful base in their technologically advanced, game-crazy home market;
• a studio that creates very high-quality, award winning games, conducive to smartphones;
• demonstrated competence in the new OEM app stores and;
• (this is key) lots of experience generating revenue from in-app purchases in Korea... which should give them an advantage as this develops into a significant component of app revenue streams in the West

GAMEVIL has 10 new games in their pipeline this year... which I'll begin to monitor more closely. These guys are hot and one to watch in 2010.

Updated: Top 10 Mobile Games Publishers WW

Enterprise Values of 15 Public Mobile Entertainment Companies

Top 10 Mobile Games Publishers WW

Here's my latest update to this list. You'll notice, based on my recent post estimating Digital Chocolate's numbers, that I've moved them up the list and increased the total revenue estimate of the Top 10.

As always, your feedback is welcome and encouraged.

Updated Top 10 Mobile Games Publishers Worldwide

If The Top 10 Generate $700mil Can Mobile Games Really Be A $5.4bil Business?

Back in March FierceMobileContent and others reported that widely respected telecoms & media analyst Juniper Research had estimated that the worldwide mobile games market had reached $5.4bil in 2008. That's crazy good, right?....or, perhaps it's just crazy.

As I've mentioned recently, I'm generally pretty cynical about big numbers from analysts, pundits, etc...especially when they just don't feel right. As part of the process of digging into this further I recently put together a Top 10 list of mobile games publishers worldwide. It's missing some numbers and the order may need some tweaking (audience participation, please), but I'm very confident about the Top 3, and pretty sure that Namco and G-Mode belong on this list. There could be a place for Capcom Mobile or maybe Konami, but I have no good data on their mobile operations... and I think I may be being generous to Hands-On (which has kinda dropped off the radar recently). Anyway, here's what I came up with (#s are annual revs or 4 most recent quarters):

My feeling is, that if I fill in the blanks here, that the total revenue for the Top 10 comes out to about $700mil. Soon after this list (and some of the companies I mentioned above) the revenue drop-off is pretty steep, with a bunch of companies generating low single digit $millions. If I make a small leap and assume that this group of industry leaders represents 70% of the wholesale revenue in the business...then the wholesale (before distribution channel) value is $1bil. If publishers are keeping 60% of the retail (consumer) price blended across all distribution platforms then the retail mobile games business is worth close to $1.7bil...not anywhere close to $5.4bil. Even if this group represented 30% of worldwide wholesale revenue (which is absurd!) the business would still be over a billion dollars short of the Juniper estimate. (As usual, let me know if there's something I'm missing!)

So what's my point here? I believe that those of us who are vested in mobile entertainment have an obligation to aggressively scrutinize the numbers associated with it, in the interest of clarity and accuracy. It's impossible to properly assess the opportunities in its various sectors (like games), or measure success within them, without proper industry metrics. Hyperbole and froth have not helped this business...in fact they've exacerbated the numerous (too numerous for a young business) boom and bust cycles we've all experienced since the late 90s and fueled substantial skepticism about mobile entertainment amongst those who are generally motivated to invest capital or intellectual property in new media.

New iTunes Paid App Top 100 Quick Stats

Average Price Top 100 App = $3.16 +7.85% from my Jun 17 survey

Average Days in Store Top 100 App = 99

note: if you remove the outlier $69.99 MobileNavigator App, Avg Price = $2.48 (-15.36% from my Jun 17 survey)

Average Price Top 50 App = $1.95 (-25.86% from my Jun 17 survey)

Average Days in Store Top 50 App = 91

Average Price Top 25 App = $1.47 (not covered in my Jun 17 survey)

Average Days in Store Top 25 App = 76

Average Price Top 10 App = $1.09 (-57.39% from my Jun 17 survey)

Average Days in Store Top 10 App = 47

Clearly price erosion is alive and well on the platform...and it's becoming more acute amongst top performing Apps. As I was running through the numbers I was struck by the fact that there currently isn't one established mobile games publisher with a title in the Top 10! Of this group PopCap has the highest ranked title with "Bejeweled 2" at #14. This motivated me to create a new spreadsheet highlighting how these guys are stacking up in the Top 100 today...

EA Mobile is clearly the most on top of its game (punny) right now vis-a-vis the major publishers on the App Store...with Gameloft & D'Choc in hot pursuit. Glu Mobile = MIA.