Specialist
Former C-level executive at Ubisoft Entertainment
Agenda
- Downloadable content (DLC), player recurring investment (PRI) and average revenue per player growth trends
- Impact of free to play (FTP) on Ubisoft (PAR: UBI) and other video game publishers
- Publisher perception of Google Stadia and streaming outlook
- Subscription based revenue models and potential pricing
- Industry consolidation outlook
Questions
1.
What do you think are the most important developments in video game publishing over the last 12-24 months? What should investors pay attention to in future?
2.
What are your thoughts on PRI [player recurring investment]? Given its relative newness as a revenue stream, how does its ROI compare with traditional titles?
3.
How do you think R&D for triple-A titles is going to be allocated by the major players in future? Do publishers now have to invest more in R&D over a title’s lifetime, and if so, does that lead to greater ROI? It seems hard to separate the two because downloadable content and in-game spending are dependent on the title.
4.
How expensive do you think it will get to design, build and publish a triple-A video game from a CAPEX perspective?
5.
Would you expect the spend associated with PRI [player recurring investment] to generally have a higher return due to the greater visibility and short-term flexibility involved?
6.
If a title typically costs EUR 100m-120m to build, what percentage of the original budget do you think would be allocated to a one-year season pass?
7.
Do you think there’s a meaningful difference in PRI for single-player vs multiplayer titles?
8.
How do you view the potential risk of juggernaut free-to-play titles such as Fortnite taking an increasing share of younger players’ attention, leaving them with less time for longer story-based titles?
9.
Do you expect major players such as Take-Two, Activision and Ubisoft to introduce free-to-play PvP [player vs player] modes similar to Fortnite? EA followed suit earlier this month with a similar title.
10.
Do you think there has been any market share shift as a result of free-to-play titles? Has there been a fall in replenishment rates for younger players into more traditional video game styles?
11.
Do you think there is scope for publishers of triple-A titles to increase the price of in-game purchases? How do you view the risk of alienating players with items such as loot boxes?
12.
Do you think that the original ROI for in-game purchases is more challenging to achieve or maintain in the longer-term?
13.
It seems that the market is moving towards fewer triple-A titles and the cost per game is increasing over time. With PRI increasing, publishers are enjoying greater average revenue per game. How do you think this will affect total returns on game investment?
14.
You mentioned that 80% of distribution is digital, with 20% physical sales. Do you think there will always have to be an element of physical distribution, or could the video game industry move entirely to digital sales?
15.
What do you think is the most important means by which publishers can maintain and improve ROI for their titles?
16.
Do you think the existing catalogues of western publishers such as Ubisoft, EA, Take-Two, and Activision could translate well to the Chinese market, or will they need to spend on incremental R&D to grow in that market?
17.
What’s your outlook for growth within China? Ubisoft announced it was partnering with Tencent, which is helpful for Chinese distribution, but I don’t think it’s come to fruition yet. There are some ongoing regulatory concerns, but do you foresee Ubisoft finding workarounds and achieving meaningful revenue in China?
18.
On the subject of streaming, Google Stadia is launching this year. How do you think video game publishers view that product, and what sort of relationship do you think they will have with big streaming players such as Google?
19.
What do you think the business model for streaming will be like? What relationship do you expect publishers to form with streaming platforms such as Google and Amazon? Will the streamers take a percentage share of revenue?
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