Specialist
Former VP at Activision Blizzard Inc
Agenda
- Implications of the novel coronavirus pandemic for video game publishers – Activision Blizzard (NASDAQ: ATVI), Electronic Arts (NASDAQ: EA), Take-Two Interactive (NASDAQ: TTWO), Zynga (NASDAQ: ZNGA), Scopely, Epic Games and others
- Top-line outlook – ARPU expansions via engagement increases vs development and console release delays
- Infrastructure investments required to sustain server quality
- Outlook for 2020 and beyond – potential wildcards
Questions
1.
How do you think the coronavirus pandemic is impacting video game publishers?
2.
You mentioned that video gaming metrics have skyrocketed during the coronavirus pandemic. How long could this benefit last compared to benefits for SVOD [subscription video-on-demand] and web browsing? How might mindshare shift around for consumers, the longer this crisis forces them to stay home?
3.
To clarify, do you expect digital console game sales to reach 40-50% over the course of the coronavirus crisis, ie over the next year or so?
4.
You’ve provided some useful trends on downloads, hours spent and overall revenues. How much of these increases do you think stem from new vs existing gamers? You mentioned that the crisis has been a large UA [user acquisition] event. Do you think this is more durable industry impact, and if so, why?
5.
How are you expecting ARPU to net out for a game such as COD [Call of Duty] between additional spend from existing gamers and the probably lower ARPU from newer gamers?
6.
What should we be comparing between AAA publishers such as Activision, EA and Take-Two to establish which players will benefit more and less from this operating environment?
7.
Could you elaborate on 2K and EA’s e-sports content? Do you think sports season cancellations could make these games resonate?
8.
Could you elaborate on mobile gaming? Is the uplift you mentioned for King a function of its specific user base? Do you expect the publishers who are over-indexed to mobile to experience lower engagement lift?
9.
How could the coronavirus pandemic impact game development timelines? It seems there’s a risk of title slippage this year. How could this be offset by publishers’ efforts to become more agile? Do you think these companies are better positioned now than they would have been a year or two ago to continuing turning out upfront and after-launch concept releases?
10.
What expectations are driving the next-gen console cycle at this point? What lift do publishers usually get from next-gen console releases? How much of that might get delayed?
11.
Could cloud gaming’s success potentially improve? What are the results of this for players such as Stadia?
12.
Could you outline how the free-to-play category is evolving? How successful do you think Activision’s Call of Duty: Warzone has been so far? Has it avoided cannibalising the company’s AAA units?
13.
How unique do you think COD: Mobile’s success has been, given that you mentioned it is likely the AAA and even AA publishers might try to create free-to-play mobile offers out of their pay franchises?
14.
Do you think Warzone is non-cannibalising for Activision because it is aimed at a different cohort of gamers from its other COD offerings? What could that mean for how the free-to-play category evolves?
15.
You mentioned that publishers are turning to developers in China to cross-platform their games to mobile, and that they are likely to start trying to insource mobile gaming development. Could this indicate the future consolidation of US mobile players such as Zynga or Scopely? Why would that not occur?
16.
How should we think about the balance for mobile companies such as King between monetisation via driving in-game power user spending vs advertising?
17.
What is your outlook for video game publishers over the next few quarters? Is there anything else we should highlight about these companies?
18.
How are you thinking about the long-term trajectory of digital? Are we on track for 100% digital sales, and could the coronavirus pandemic accelerate the deterioration of retailers such as GameStop?
