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Big Point to Prove

Thu 08 Dec 2011 8:00am GMT / 3:00am EST / 12:00am PST
Online

Bigpoint's Philip Reisberger on money, tablets and going beyond social networks

Bigpoint have had a good year. Numbers are up, with the 200 million users reported in June now well north of a quarter billion. Battlestar Galactica has proven to be the company's biggest ever game, and the publisher's headcount at its Hamburg headquarters has risen above 800, thanks to some useful acquisitions.

The team has been understandably bullish, claiming that EA doesn't know how to monetise, and suggesting that what many see as the archdemon of free-to-play, paid for advantages, are the way for companies to develop their business.

At Evolve in London last week, Bigpoint's Philip Reisberger was on hand to reveal some of the company's secrets for success, plus some of its less conventional ideas.

Q: So the big topic on the events circuit at the moment seems to be the push to mobile and tablet...

Philip Reisburger: It's the new Facebook. [laughs]

Q: Exactly - the topic that's everywhere. You mentioned that you're moving Farmerama to tablets, is that part of a bigger push in that direction for Bigpoint?

Philip Reisburger: We totally believe in mobile. In mobile casual, mobile social, whatever you want to call it. I personally, and the same is true for Heiko (Hubertz) and the rest of the management team, we see this huge opportunity for mobile.

My predecessor (Nick Parker, speaking before Philip at Evolve) who showed some of the numbers in terms of how the revenue source from people who once paid via subscription has moved to free to play, even in the mobile space. That's exactly what we see happening, for us it's just a logical consequence of going mobile.

Farmerama is just the first.

Q: Can you tell us how many tablet games you have planned for the coming year?

Philip Reisburger: I can't tell you the exact number, but it's going to be a lot more than just five or six. Mobile is one of our key areas of growth.

Q: Is it an area where you'll be debuting new IP?

"I like what Facebook, Zynga, mobile are doing - they're educating people to play."

Philip Reisburger: The real key for success is...well there are two ways of doing it. One is to utilise and manage your existing userbase to a different platform - but the other one, real growth, is having unique concepts. So no, we're not just porting or copying our games, we are really working on developing totally new games for mobile.

Q: Do you think that the PC browser game market has plateaued now? Is mobile cannibalising it?

Philip Reisburger: I'm not really differentiating too much, really. When you have a user, he or she has a certain amount of time that they spend on playing. For us, if you compare the start of Seafight five and half years ago, no one would have considered that we'd have the people we do now playing games.

For me, I like what Facebook, Zynga, mobile are doing - they're educating people to play. What I like a lot is the fact that when we were young the gamer was a guy locked in his attic or bedroom. Now you see people playing everywhere.

So I don't see this peaking, I see it growing, maybe even accelerating because a few years ago we had maybe ten million gamers, now we have a billion gamers. So I think that there's huge potential. What we really see is that the quality of people's expectations are really rising.

People who really liked the one click games a year ago - they've been there, done that, got the t-shirt. What they really want now, these casual gamers, is something more complex, but still social or casual. That's why we see rising development budgets and that sort of thing.

Q: You mentioned in your presentation about literally bumping into a woman in your car who you ended up talking about games to. She turned out to play a lot of casual games but was still almost horrified when you referred to her as a 'gamer'. You also mentioned the need to turn these casual gamers into quite core players quite stealthily, gently. Do you think that's because there's still a bit of a social stigma attached to being a gamer?

Philip Reisburger: Personally I think that everyone loves games, but the reason for reactions like that is that not understanding what gaming means. Especially in Germany there's a lot of press about youth protection and all of that stuff, gaming always has a bit, or used to always have a bit of a negative perception. So people who are new to this field are a little bit more aware of that than people like us who grew up with it and chose a profession in it because of our passion.

It's just a bit of a different mindset. Give it until 2016, 17, 18, 19, 20, when we're the old ones and there's a generation who've grown up playing on mobile devices and phones, they'll have a totally different view. We've seen it even in the last two or three years.

Q: There's a fair amount of business consolidation going on at the moment in social and casual, with mergers and acquisitions. It's what you'd expect from any maturing business, but there have been some casualties too. Are you feeling any of the pinch?

Philip Reisburger: Directly in terms of market developments and things like that, we're definitely on the plus-side, we're continuously growing. We don't see any issues and we've don't have any plans for consolidation or anything like that. We just moved into a new office three months ago which has seven floors - we now have more than 850 people there.

Just last month or the month before we acquired 49Games, who made console games. That was 43 people. So it's continuous growth, we still have around 80 or 100 positions vacant.

Of course it always has to pay, we like positive margins and stuff like that!

"The 200-250 million monthly actives that they have, that's say 30-40 per cent of the active Facebook population. Our quarter of a billion registrations we have do not represent 30-40 percent of the internet's users."

I think the main reason for consolidation at the moment is that new things are emerging, so you get stages of repeated growth and consolidation. The market has just become a lot more professional, more mature.

Q: And you along with it?

Philip Reisburger: We have big SAP systems and stuff like that - if you're a smaller indie developer and want to grow, there are other companies who'd say "a two Euro ARPU is fine, but we can do 12" - I'm just making up numbers here!

Just having the distribution network, that's something that took years to build up, it's one of the benefits of having this big infrastructure.

Q: One of the problems we've seen Zynga have, after becoming the de facto spearhead for the market, is that their new games tend to just stir the pot of their existing users rather than attracting new ones. Is that an issue for you in the same way? You have a much broader portfolio of games...

Philip Reisburger: For me it's less the portfolio - I love what Zynga is doing, they really have this iterative innovation. They grow something and then the next thing is a little bit better - they totally understand it - their business sense is quite similar to ours.

They have a different basis, though, because we're outside of Facebook. The 200-250 million monthly actives that they have, that's say 30-40 per cent of the active Facebook population. Our quarter of a billion registrations we have do not represent 30-40 percent of the internet's users. So we're in a bigger market, we're not relying on a new guy registering on Facebook - we have over a thousand media partners who drive traffic, so whenever they venture into new ground, it's beneficial for us.

We are where the internet is.

Q: Do you see businesses like Zynga having to move outside Facebook?

Philip Reisburger: Oh they desperately want to. I mean, what's the website called, the portal they're working on? Z-whatever. They have plans, they've had plans for the last two years. Everyone wants to reduce their dependence on Facebook I think. Eventually it will come, but as some attempts have shown in the past, it's not as easy to understand the world outside Facebook because it's a totally different world.

That's why Bigpoint is in a very good position: we're not just the ones developing, we've mastered, to a certain degree, the distribution.

Q: We talked about the merger and acquisition market earlier - would you be pleased if somebody approached to buy you, or do you see yourselves as being on the other end of that transaction?

Philip Reisburger: We have included in our company, well, included is the wrong word...We took over the Planet Moon stuff, the Radon Labs stuff, more recently the 49Games stuff. In total that's 150-200 people. We love acquisitions, we're looking for acquisitions all the time.

For me it's not a matter of if you're doing that, but what one is buying. Once a company has a certain power behind it, this is just a regular way of acquiring technology, talent, market share or whatever it is.

As for the other side, let's not comment on that now - let's leave that to the business side, not the games side!

Q: One of the things which really caught my attention in your presentation was the graph you showed comparing ARPU against player level in Farmerama. There was a huge spike in revenue at the end where people were hitting the top level. Is that where the whales are?

"To us, revenue and money is always a consequence. Always. The first thing is always games, it's concepts, it's game designers."

Philip Reisburger: Actually the whales are everywhere. That's just where you hit the wall in terms of the level curve. Progressing from level 5-7 might take an hour, but progressing from level 67-70 might take three days, four days or a week. Because it takes a lot more time you can potentially spend a lot more money.

Q: So do you see people spending more money as they get more engaged or do they become more engaged as they spend more?

Philip Reisburger: To us, revenue and money is always a consequence. Always. The first thing is always games, it's concepts, it's game designers. My brother and I are from a finance background, so we love numbers, we love optimisation, we love KPIs, but that is only for optimisation.

True innovation doesn't come from numbers. True innovation comes from creative people who, I don't know, spend most of their waking time when the sun is down and stuff like that! [laughs]

I totally love my creative guys because they are the guys who really drive new ideas and get the most out of them in terms of user timespan and everything like that, and as a consequence money. But it should always be a consequence, not a prerequisite.

Q: Something we heard earlier, from Nick Parker, was that UK investment cash was leaving the country and going to Germany and the Nordic regions because they had adapted more quickly to new markets. You said that you thought that was because Germany hadn't been as focused previously on console development, but had been in the strategy and PC space. Can the UK catch up?

Philip Reisburger: Of course. If you look at games like Battlestar Galactica, eventually the Mummy and others to come - especially our Unity 3D engine based games, they are a lot more aiming towards the console market than our casual games or 2D Flash games.

So new technologies, like our internal engine, the Nebula engine, or the Unity engine, whatever technology there is, this is something which is a huge opportunity for traditional console developers to use their strengths.

This is where we are focusing as well. I totally love it. I want an experience where you don't have to download, where you don't have to pay up front - you just login to the browser and play. Who wouldn't want a 3D, full AAA experience in the browser? Or on mobile?

Q: Do you think that a multi-screen experience, that idea of always having a screen nearby to play a game on, be it phone or browser or TV, is possible?

Philip Reisburger: That's like the holy grail of having the user play your game or portfolio 24/7, wherever he or she is. I think it's still a long way away, because the technology is just emerging where you can really port - and you have to bear in mind that developers are going to focus on the different aspects of the platform. A mobile platform has different requirements to a browser.

Don't just copy a game and release it everywhere, it won't work.

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