Hired for her background in e-commerce, Nanea Reeves joined Gaikai last November from Electronic Arts' global online business, and at E3 this year she met with GamesIndustry.biz to discuss expansion at Gaikai, as well as demoing various instances of the streaming service working on web-connected TVs, tablets and embedded in Facebook.
In this exclusive interview, we discuss the growing acceptance of streaming and cloud technology, intentions to expand the Gaikai affiliate scheme to a target of 10 million monthly active users, early prototyping of TV and hardware for specific formats, and adding value for publishers and developers through additional in-game features.
Q: Can you start with a little about your background and your role at Gaikai?
Nanea Reeves: [I've been] working on digital distribution in the games industry for a while, that was my permanent focus in EA. So when I met with David it was a natural progression to just go "wow." I have more of a traditional e-commerce background and then came into the games space about ten years ago when the two started to come together. And so it's been a really fun arena for me to kind of bring that e-commerce focus to the digital transition.
Q: Your background was in e-commerce before you joined Electronic Arts. It must have been interesting seeing that transition of games adopting digital payments. It's been a fast transition.
Nanea Reeves: A lot faster than people thought, because I set up a lot of that at EA early on, and then also in the mobile space I did a lot of digital distribution across multiple devices. Which in a way is very similar to what Gaikai is doing as well, you know the fact we're streaming video allows us to get that content out to any device that can accept a video stream.
Our main goal is to immediately have a target of ten million monthly active users through our affiliates
Q: I think the speed and evolution of this market has caught a lot of people, international games publishers, by surprise.
Nanea Reeves: It's because you need to have a different kind of DNA in the company as well, and so John Riccitiello [EA CEO] was very aware of that when he came in at EA and started really beefing up a lot of that. And you can see the benefit that EA has now as a result of really focusing on digital with their acquisition agenda. There are some publishers who are going to need to catch up or they won't survive.
Q: I think it's probably too late to catch up for some publishers.
Nanea Reeves: For us, that's a big focus for our business and what makes us different from other cloud gaming companies out there is our whole posture is to help enable people to grow their digital and accelerate their digital strategy. So focusing on that whole discovery engine and using that to drive more conversions, direct to consumer. And then we can even transition to the full delivery of the content, whether it be through a stream or a download. So I think that whole other management layer, to shopping cart checkout, that's really e-commerce.
We saw a big opportunity that it's not too late, we can jump in and help you do that. And we don't want to own the customer, we can help you grow your own customer base, and I think that's the big difference between us and companies like OnLive who've done a great job. They're really the only other company who've set up a network like we have.
Q: There's really only you two in this space that are showing growth and momentum.
Nanea Reeves: The difference between us is really in the business model. They are a consumer destination, they own the customer, and they have to navigate that. We want to just facilitate you to get up and running, and however you want to structure the relationship with the end user we can do it for you or we can integrate with your existing systems. Much more friendly.
Q: Tell us about the Gaikai Affiliate Network and your plans for that.
Nanea Reeves: Our main goal is to immediately have a target of ten million monthly active users that we're trying to address in the aggregate, through taking all of our affiliates like The Escapist, like our Eurogamer announcement, and all the other ones we're signing up right now through our website that we just launched. And our first target is to get ten million monthly uniques that we can push these game experiences out to as a way to help the publishers and the online retailers address more audience.
Q: What's your deadline for that 10 million figure?
Nanea Reeves: We want to target it fairly quickly before the fall. That's our big goal. We think we can get there very quickly by turning on a few key partner. Obviously The Escapist has a big reach, Eurogamer does, so we could get there fairly quickly.
Q: You must have been speaking to TV manufacturers about this technology. If you get a browser in the TV, there's no need for a console any more. And TV manufacturer's don't traditionally make great margins on TVs, they're very expensive to make and ship and consoles take advantage of the screen, it's not the manufacturers benefiting from the game on their TV...
Any device that can accept a video stream over the air we can deliver content to. The primary focus of our development team is to enable prototypes and proof of concept on each one of those devices
Nanea Reeves: Yes, we are [talking to TV manufacturers]. So any device that can accept a video stream over the air we can deliver content to. The primary focus of our development team is to spend time really enabling prototypes and proof of concept on each one of those devices. With the TVs we will be shipping a controller with the TV as a separate accessory.
Q: But then does Gaikai have to get into hardware manufacturing itself?
Nanea Reeves: No, it can be a joint venture. Again, it's stuff we're already prototyping. We've got default iPad, iPhone controllers.
Q: Have you already got a partner in place?
Nanea Reeves: It's not something that we're ready to announce just yet. We're looking at it. We're definitely looking at it. Because, you know, if our business is to help all of the partners scale their business we have to be ready across multiple fronts. And the nice thing about this solution is that it doesn't require any custom chip to be included in the device or separate unit. We're straight on the existing infrastructure.
But really I think our big focus right now is growing that affiliate work and getting that to happen. And then you get the buy offer here, and that offer can be fine tuned. We're seeing very nice lifts in conversion.
Q: How many publishing partners have you got signed up? Is it still only Electronic Arts?
Nanea Reeves: We are signed with EA, which had been public for a while, and then at E3 we obviously have garnered a lot of interest from the other publishers as well as we're in conversation with a lot of them. We'll make some announcements on two more very shortly.
Q: Gaikai seems to do a lot of stuff quite stealthily - what comes after growing the 10 million affiliate network?
Nanea Reeves: Well, we're starting to focus on how we scale beyond that discovery network so we're also signing on a lot of online retailers and we'll have some announcements in that area very soon, in the next few days. Obviously as a conversion tool allowing customers to jump in and try a game before you buy it, it's very gamer friendly and our early test results are showing significant impact on the conversion rate by allowing them to jump right in the game. They don't have to go through a download and all that.
The challenge is you get a customer that might be playing a game in their browser but they can't play the game on their Mac. In that case we've been approached how do we support that customer, and can we transition them to an always on full game stream?
You don't have to put a custom chip in [a TV]. And that's a big deal for the manufacturers. Their lead times are very long
Q: It's also interesting that you're adding functionality to games - like the 3D solution where games that aren't natively in 3D get that added via Gaikai.
Nanea Reeves: We're working in partnership with Nvidia, so we'll work with them to perfect their drivers and make sure everything streams...
Q: I guess that's an additional paid-for service that publishers pay extra for from you guys?
Nanea Reeves: It's a premium service from us. Obviously it is a very attractive feature for the new TVs coming out in 3D.
Q: Basically you're adding a whole new function without the television manufacturers or developers having to do it themselves...
Nanea Reeves: I'm not sure that anybody else is doing this just yet either. It looks great once you play in 3D.
Q: How long have you been offering that as a service?
Nanea Reeves: We showed this first at CES, that was the first place we showed it and now we've been fine tuning it. We just built out our network to support the more high end content, so we're just starting to ship those servers out. So what you're seeing is, you're probably one of the first people to actually see this server in action.
Q: Beyond the Eurogamer affiliation, what other plans have you got for Europe?
Nanea Reeves: Well Eurogamer's our first big partner launch for the affiliate network and we are also talking to some online retailers through an aggregator so that will be something we announce once we finalise the details. Europe's very important to us of course, it's a huge PC game market as well as just gamers in general. We don't want to just be in UK, we have to be in Germany, especially, right?
Q: You're also beginning to show Gaikai running on TV sets without any inbuilt hardware. Purely via a web browser.
Nanea Reeves: It's being remotely controlled with the RF controller, we just wanted to see if we could do it. So there's nothing local, no box, it's streaming from the web. We show LEGO Star Wars we worked with the manufacturing company's engineers to get this working. It's just a proof of concept to see if it was really possible and so we're now we're starting to figure out how we continue to scale that. You don't have to put a custom chip in there. And that's a big deal for the manufacturers obviously. Their lead times are very long.
Q: It's interesting that you're adding functionality, 3D, controls for iPad games not designed for the interface, but where does that stop? You don't want to go down the line too far where you're becoming part of a development team.
Nanea Reeves: No not at all because we're not, we're actually facilitating that as a service layer so it becomes available to all of our partners.
Another way to think of it is that Gaikai will be a platform, so we'll have an SDK that developers can build against to access some of this functionality and to tailor their game experience ideally for the places that we're targeting.
But it's not necessary for them to do that. Without any effort we can deploy to multiple devices. So that's key for our growth, that's the longer term plan. Having a game team available to you is an amazing thing. Often times they're gone working on another project so no one even knows how to administrate the code so we need to be very flexible.
OnLive is announcing that they're launching from Facebook, we're actually embedded in there
Q: And you've got Facebook integration now as well.
Nanea Reeves: It's just from within a web browser and David [Perry] has tweeted about this. If you just think we can embed in any web page, that would include Facebook, so it's not a big deal. OnLive is announcing that they're launching from Facebook, we're actually embedded in there. We like those guys, they've done a great job, it's just a very different business model.
Q: Would you ever consider taking this service straight to the consumer rather than via publishers?
Nanea Reeves: It's not our first goal. Technically we can, obviously, but we're building it as templates, and then you have to think about customer acquisition etcetera, you're competitive in the space, we think there's a big opportunity right now to help people evolve their digital strategies, as you said, some people have some catching up to do. And so if that's our primary focus it's just a much better arena for us. And then it simplifies also our business relationships with them. We become a service. We can power your channel for you though, if you don't want to have that relationship we can certainly do it.
Q: It sounds like the company is growing very rapidly. Can you scale up that quickly?
Nanea Reeves: It's a good question.
Q: Because I remember the first Gaikai announcement when it was just David Perry and a couple of guys in a room.
Nanea Reeves: Yeah, now he's got a nice management team. I have a lot of e-commerce background, we've already built out our data warehouse, so you start to see a much beefier management team, and we bring in our own resources as well. I've been building a lot of the data warehouse environment which is up and running now and built on the same solution that Zynga and Groupon are using so we're doing this as a pro company and the focus for our growth is to build out that service layer. Many of us have done it before at other companies so it's just bringing in the right people. We've got the hard part done, which is doing the impossible, which is delivering that low latency.
Q: Do you think you've convinced the audience now of what Gaikai is and can achieve?
Nanea Reeves: They can see it, we can demonstrate it. So now what's going to make or break us our ability to build out that service. So we've got the whole advertising, try before you buy stuff, in place getting ready to go live and we've launched our affiliate network. That demonstrates that the platform works and now we're adding this other service.
Q: So I guess you subscribe to this theory that it's now about two screens in the living room? There's the screen there that the whole family is watching and then everyone has got their own personal screen.
Nanea Reeves: I do. I think you've got a lot of things competing for your attention, honestly when I play console, I've got my laptop and Youtube walkthroughs. I'm ashamed to say but it's true. Being able to get the experience, to access it through your browser I think is a key differentiator for our company. Everything has a browser now in it. And we can also go native as well, we can integrate with your own applications. If I'm playing on the television and I can pop the experience into my iPad when I go the bathroom, I can do that and never stop playing. I can play in boring meetings under the table on my phone, so it's that ubiquity.