Land of the Rising Revenue -How Mobage-town Became a $1B Business in - PowerPoint PPT Presentation

Land of the Rising Revenue -How Mobage-town Became a $1B Business in Japan and Lessons Learned for US Developers- DeNA Co., Ltd. Tomoko Namba 0

DeNA Financial Performance GDC Online October 5, 2010 Net Revenues Ordinary Income(Profit before tax) (Million USD) (Million USD) 600 1200 1136 560 500 1000 400 800 x4 x4 565 300 600 253 442 189 349 200 400 150 166 284 140 200 100 54 3 months 3months 75 22 33 5 0 0 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 *Revenue and ordinary income for FY2004 are on a non-consolidated basis. Currency converted with the exchange rate 1USD = 85JPY. Figures in FY2010 is run rate basis. 1

World biggest Virtual Identity SNS GDC Online October 5, 2010 Games, News, UGC, etc. Virtual Identity SNS 21M registered users 2

Community × Games GDC Online October 5, 2010 Community & SNS Games In-house • Avatars • Group Activities • Mini Mail • Celebrity blogs • Diaries Third Party • Greeting • Friends request • Footprints, etc. 3

The value of Mobage-town Open Platform GDC Online October 5, 2010 � Launched the Mobage Open Platform on January 27, 2010 � Partner companies: 222 Game titles ： 527 (as of Sep 29) Daily Use of Moba-Coins Key tools for developers (Index; Jan 2010=100) 2000 Community/User Base 1800 1600 Function API 1400 (invites/avatars/ranking etc) 1200 Billing system/ 1000 Common Virtual Currency 800 600 Ads/Promotion 400 200 *100 Stats/Consultation for Monetization 0 Jan Feb Mar Apr May Jun Jul Aug Sep 4

Mobage-town Revenues GDC Online October 5, 2010 Mobage-town Revenue Breakdown （ Apr-Jun, 2010 ） $1B * Advertising Others 9% 1% Virtual Goods Avatar- related Net Revenues 13% $245M 3 months from just Game etc 77% 21M users! − In-house Games − Third party games (30% DeNA, 70% Third Party) * Run rate, 2010 5

ARPU Comparison GDC Online October 5, 2010 Yearly Registered ARPU Revenue Users (USD/month) 0 1 2 3 4 $1B* 21M ÷ ＝ x6 $600M *2 72M *3 ÷ ＝ x18 $1.3B *4 500M *4 ÷ ＝ Even higher ARPU recorded by Active User basis * Run rate, 2010 *2. Run rate, 2010, Business Insider *3. only for Farmville *4. eMarketer, July 2010 6

User Engagement Comparison GDC Online October 5, 2010 DAU/MAU (averaged figure for all games) 0% 10% 20% 30% 40% 50% Mobage-town games − “Kaito Royale” sustains 50% for one year Typical good games Low dependency on Ads/Promotion due to “stickiness” 7

The launch of Yahoo! Mobage GDC Online October 5, 2010 PC-based Social Games SNS launched on Oct 2010, with 100 games from 70 developers Send Seamless traffic usage 52M MAU (as of Mar 2010) 21M Reg Users First “social games focus” PC platform in Japan (as of Aug 2010) 8

Mobage-town Revenues GDC Online October 5, 2010 Mobage-town Revenue Breakdown （ Apr-Jun, 2010 ） $1B * Advertising Others 9% 1% Virtual Goods Avatar- related Net Revenues 13% $245M 3 months from just Game etc 77% 21M users! − In-house Games − Third party games (30% DeNA, 70% Third Party) * Run rate, 2010 9

How Were We Able to do This? GDC Online October 5, 2010 Strong Community Base � � Post Launch Operations Rapidly Expanding Developer Line Up � 10

Power of Virtual & Game-centric Community 1 GDC Online October 5, 2010 MMO Mobage-town Strong Virtual Community Guild A 7.5mil* updates/day from 21 mil Users Game A No shift Party A Diary Friends Request Official Circle Guild B Shift Shift No shift Game B Game A Game C Game B Party B Shift Shift No transition across games Many transitions across all games *Averaged figure in Aug, 2010 11

Power of Virtual & Game-centric Community 2 GDC Online October 5, 2010 1 st game 2 nd game 3 rd game invites Connect Inactive Active friends Real Social Graph Dynamics 3 rd game 2 nd game 1 st game Make new invite Make friends Make new invite new friends invite Make friends friends in community Virtual Social Graph Dynamics 12

Mobage-town Revenue Trend GDC Online October 5, 2010 Mobage-town Net Revenues (Million $) 245 Others � Launched open 3 21 Ads-related platform (Jan, 2010) Avatar-related 33 176 2 23 � Launched 1 st social game (Oct, 2009) 31 92 187 Game-related 1 23 62 59 1 118 0 25 25 22 42 30 29 5 4 1Q 2Q 3Q 4Q 1Q (Apr-Jun) FY2009 FY2010 *1USD = 85JPY 13

How Were We Able to do This? GDC Online October 5, 2010 Strong Community Base � � Post Launch Operations Rapidly Expanding Developer Line Up � 14

Effect of Post Launch Operations GDC Online October 5, 2010 Weekly Revenue of Title A (USD) Lost gaming balance between high and low level users Radical revision of game Radical revision design of gaming - Improved operability balance - Changed gaming tempo - Redesigned whole parameters - Enhanced scalability Wk1 Wk6 Wk11 Wk16 Wk21 Wk26 Wk31 Wk36 Wk41 Wk46 15

Revenue Trend Image GDC Online October 5, 2010 Typical Good Games on App Store Mobage-town games Communication Buzz enhances effects of Post Launch Operations 16

How Were We Able to do This? GDC Online October 5, 2010 Strong Community Base � � Post Launch Operations Rapidly Expanding Developer Line Up � 17

Rapidly Expanding Developer Line Up GDC Online October 5, 2010 Game Developer for Mobage Open Platform 200 more and counting 18

DeNA Global Strategy GDC Online October 5, 2010 Strategy Social Games Centric × Virtual Community Operational Support for Strong Monetization Multi-Platform (iPhone, Android) × Multi-National (US, Japan, Asia, Others) We welcome THIRD PARTY social games! 19

DeNA Global Road Map GDC Online October 5, 2010 Third party games In-house games Virtual +Developer A Identity SNS Friends My Groups Diary Top3* +Developer B Beyond US Top3* - Japan +Developer C - Asia, etc. Social Games Multi-Platform Multi-National 20 *Ranking of “Top Free Apps” at iPhone App Store as of Sep 7 th , 2010

Thank you! GDC Online October 5, 2010 Any Questions? ⇒ bd@denaglobal.com 21 21