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JAPANESE MOBILE GAME MARKET Presenter: TADAO OGIHARA

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TODAY’S CONTENTS

I. INTRODUCTION

II. MOBILE GAME MARKET IN JAPAN

III. COMMON FACTORS AMONG TOP 10

GAME APPS IN JAPAN

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I. INTRODUCTION

1. Presenter

Name: Tadao “TAD” Ogihara

Job Title: Project Manager/Director/Planner

• Started my career in this industry 3 years ago

• Before that, worked for Cirque Du Soleil, a world-renown circus company

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2. Company

KLab Cyscorpions

• Subsidiary company to KLab Global Pte. Ltd.

• Multi-cultural organization in the pursuit of providing the

world’s best-loved services

• Planning, development, quality-

control and operation of

smartphone apps for both

global and Japanese market

I. INTRODUCTION

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2. Company

KLab Cyscorpions Products

I. INTRODUCTION

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2. Company

KLab Inc. • Planning, development, quality-control and operation of

smartphone apps for Japanese market

• Considered as one of major mobile game companies in Japan

I. INTRODUCTION

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2. Company

KLab Products

I. INTRODUCTION

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II. MOBILE GAME MARKET in JAPAN

1. Global

• Total Sales in Mobile Game Market: $ 81 Billion

• Growth from 2013 to 2014: + 8.0%

• Estimated growth from 2014 to 2015: +8.0 %

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2. On-line Game Market in Japan: Share

PC/Console

SmartPhone/Tablet

Feature Phone

[2013]: 8.4 Billion Dollars

1.6 1.3

5.5 (65.4%)

[2014]: 9.3 Billion Dollars (+ 10.5%)

0.8 1.1

7.3 (78.4%)

• [Feature Phone] + [PC/Console] markets shrink

• [Smartphone/Tablet] Market Expansion

= On-line Game Market Expansion

II. MOBILE GAME MARKET in JAPAN

(Billion Dollars)

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4. Smartphone/Tablet: Share

• Native App is only one expanding in this market

• Though the above is obvious, some companies stay in Web Game still

$0

$2,000,000,000

$4,000,000,000

$6,000,000,000

$8,000,000,000

2013 2014

Native App

Web Game

$3.2 BLN

$2.3 BLN

$5.9 BLN

$1.4 BLN

II. MOBILE GAME MARKET in JAPAN

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5. Dynamics of Mobile Game Industry

• Mobile game history started with SNS platform

• Years later, Native App began taking over the majority of mobile game market and expanded it

2007 Around 2012 2015

Platformer

Native App

II. MOBILE GAME MARKET in JAPAN

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II. MOBILE GAME MARKET in JAPAN

6. Competition

[Past] There was a boundary between

console game and mobile game company

[Now] The boundary is off,

and the fight begins!

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7. Cost Production Cost: $1 Million (Minimum)

Advertising Cost: $100 K/per month (Top ranking titles)

Running Cost: Monthly $3~5K/ per member

These costs are forecasted to increase even more

Outsourcing a portion of the production from abroad to downsize these costs

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8. Sales [Current Situation]

Competition is expected to become even more severe

Production and operation costs are likely to grow higher

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8. Sales [Current Situation]

Competition is expected to become even more severe

Production and operation costs are likely to grow higher

Why do we create a mobile game in this market?

II. MOBILE GAME MARKET in JAPAN

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8. Sales [Current Situation]

Competition is expected to become even more severe

Production and operation costs are likely to grow higher

Why do we create a mobile game in this market?

BECAUSE IT BRING LOTS OF PROFITS!!

(ONCE IT IS RANKED HIGH in SALES!)

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8. Sales

0

5

10

15

20

25

30

35

40

45

50

Top 3 4 to 10 11 to 25 26 to 50 51 to 100

JAN, 2013

JAN, 2014

JUN, 2015

JAN, 2014: Over $50 Million JUN, 2015: Over $100 Million

JAN, 2013 23.9 2.4 1.1 0.5 0.2

JAN, 2014 Over 50 8.5 4.5 1.9 0.8

JUN, 2015 Over 100 15.8 6.5 3.7 1.5

(Million $)

RANK RANGE

MONTHLY AVERAGE

SALES

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8. Sales (The Share of Top 100 Apps)

Total Native App sales in 2014 = $5.9 Billion

Top 100 Apps Sales in Jan, 2014 = $4.3 Billion (Calculated based the given average sales from the previous page)

Top 100 Apps occupied 73% of total Native App sales

“Winner takes more, loser… won’t get much”

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8. Sales i.e.) Mixi

-100

0

100

200

300

400

500

600

13.07-09 13.10-12 14.01-03 14.04-06 14.07-09 14.10-12 15.01-03 15.04-06

Sales

Net Income

(Million $)

PERFORMANCE

QUARTER

Deficit + App “Monster Strike” released

Not only the app overturned the deficit, but also it increases the company sales more than x20.

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Top 10 Mobile Games in Japan

(As of August 1, 2015)

III. Common Factors among Top 10

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III. Common Factors among Top 10

The Common Factors among These Titles:

1. EASY CONTROL

2. COOPERATION (Sychronization)

3. POTENTIAL USER POOL

4. GRAPHICS

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1. Easy Control

Most of Top 10 games focus on “easy control”

“Easy-control” opens door to game as many potential users as possible.

The images on the right are from App Store. There are a common wording among them.

III. Common Factors among Top 10

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1. Easy Control

What defines “Easy Control” ?

“One finger, One action”:

With such an effort, a lot of people are able to enjoy these games.

III. Common Factors among Top 10

Drag

TAP

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2. Cooperation All Top 10 mobile games have some kind of cooperation system, either fighting together or fighting against each other. There are 2 types of cooperation.

A) Asynchronization: Operation-side Oriented

Player A

Player C Player B

Player D

EVENT PERIOD

III. Common Factors among Top 10

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2. Cooperation

B) Synchronization: User Oriented

Player D

Player B

Player A

Player C

Ready and GO!

EVENT

III. Common Factors among Top 10

- Becoming a popular choice among the top ranking titles recently

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2. Cooperation

B) Synchronization : User Oriented

III. Common Factors among Top 10

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2. Cooperation

B) Synchronization : User Oriented

Friends Bond

Older Less Time

HEAT UP

III. Common Factors among Top 10

# of Play↑

Sales ↑

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3. Potential User Pool

Ranking among Top 10 is established by many factors. One of the most essential factors is acquiring a vast number of players constantly.

Most of the titles in Top 10 have a “Potential User Pool” to achieve this goal more efficiently than others.

III. Common Factors among Top 10

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3. Potential User Pool

SNS C2M

Media

Inheritance

III. Common Factors among Top 10

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3. Potential User Pool

SNS

III. Common Factors among Top 10

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3. Potential User Pool

CONSOLE MOBILE

III. Common Factors among Top 10

C2M (Console to Mobile)

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3. Potential User Pool

III. Common Factors among Top 10

Inheritance

2014

2015

i.e.) COLOPL, Inc.

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3. Potential User Pool

Movie etc.

Game

Anime

Media

III. Common Factors among Top 10

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4. Graphics

Among Top 10 titles mentioned here, there are a few titles using 3D graphic (Some are using both 3D and 2D). The rest is using 2D graphics.

2D graphics used by these titles is the style of drawing similar to the ones from Manga and Anime in japan.

III. Common Factors among Top 10

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Summary

1. Japanese mobile game market is expanding. Native app is the most promising in the market.

2. A lot of competition is expected in the market. However, you will be rewarded if you survive.

3. Sometimes Japanese market seems very different from the rest of world. But if you look closely what the market favors or what it doesn’t, you will see the common elements you can implement.

…Thank you!

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…And