Introduction

Jon Jordan: Welcome to the Mobile Games Playbook in association with Liftoff. Join us as we uncover the latest trends in user acquisition, monetization, and mobile game design. Hello and welcome to the Mobile Games Playbook. This is a podcast all about what makes a great mobile game, what is and isn’t working for mobile game designers, and all of the latest trends. I’m your host, John Jordan. Joining me today is Kalle Heikkinen, Chief Game Analyst at Game Refinery by Liftoff. How’s it going, Kalle?

Kalle Heikkinen: Very good, how are you?

Jon Jordan: Yeah, not bad, not bad at all. And Erno, Chief Game Analyst at GameRefinery, a Liftoff Company. How’s it going, Erno?

Erno Kiiski: All good.

Jon Jordan: Good, good. So, we are over halfway through 2024. So time for some retrospective discussion on what’s been going on in the mobile game space, as well as plenty of trends and new games to discuss. So, who’s gonna kick us off? What are the big trends that you are seeing?

Supercell’s 2024 strategy shift

Erno Kiiski: Well, I was thinking maybe at first we could discuss a little bit about the games and, first of all, what are the trends in terms of genres and the new entries in the market? And what has been happening in the first six months before we go in any deeper on the game level feature level details or anything like that? But maybe let’s start off with mid-core stuff. To me, it’s definitely one of the biggest stories of 2024 so far. Supercell has never been out of the picture, of course, but they have made quite a big change of direction and have been scaling pretty much all of their games at the start of 2024. So now, naturally, they are pushing a lot with their live ops, adding a lot of live ops to their game.

Erno Kiiski: They used to be the whole kind of mentality of very tiny teams on these games and kind of like a light on live ops compared to many other competitors and markets, but still kicking ass, but now, especially, they have been ramping that up pretty much on all of their games. And that can also be seen in the performance, especially Brawl Stars, which is probably one game that has been covered most in the industry. So much talked about how they have turned the boat around and have been scaling like crazy, record numbers, record months, month after another.

Erno Kiiski: This game has been around for a while already. So why? Well, of course, I’m not going to tear down and go super deep into the game, but a lot of things are happening with its monetization, like how they overhauled their battle pass system and changed them. There was a lot of discussion when they removed the gacha system. Then there was a small, actual drop in late 2023, but now they figured out how to make that model work that they have. And, you know, how they overhaul their battle pass and, overall, how they are unlocking characters and the monetization. You could earn the currency back and buy the battle pass. But now I have to buy every season of the battle pass and so on. So, there are a lot of changes in terms of how the game works, how the game gets monetised, and especially then talk about the live-ops and how the whole live-ops and live-event framework is supporting the game.

Erno Kiiski: So, massive scaling. The same thing is true with Clash Royale. The game has been scaling, not as radically as Brawl Stars; we have to mention Squad Busters. I think Brawl Stars was Supercell’s last launch, so we finally have Squad Busters getting the game out there. And of course, I think, at least by their own quotes, it was like the biggest launch because it’s kind of like an effort for the launch of a game for Supercell than ever, massive marketing campaigns with all those Hollywood celebrities making the ads and pushing the game there.

Squad Busters: Launch and market reception

Erno Kiiski: Quite a solid start all the way to the top of the charts. But since the launch, I think they launched in May, end of May, it had declined a little bit around to kind of like a top 50 game or so on in the US charts. but now it seems to kind of stabilize around that area also with the download; it has, of course, gone down since the initial launch a little bit, but has stabilized. So now it’s an interesting part of the life cycle to see where the game goes. Are they able to do the same thing as Brawl Stars, add a lot of live events to the game, and support the game for the long run to sustain and stay at the top? That still remains to be a question.

Erno Kiiski: I remember one of our analysts who played that game very thoroughly saying that, at the moment, it’s a stable moment in the game, new content around the amount of live events is still quite light. So, where the game goes next will be a big topic in the latter half of 2024. My first highlight would definitely be the Supercell new game and all the game scaling.

Kalle Heikkinen: Yeah. On Supercell, I have to say that, and when it comes to Squad Busters, specifically, like Erno said, this is the interesting phase where It’s still early to say anything definite yet. We definitely need more time to see how the game forms. But at the moment, I actually have more questions than answers. One of them has always been: How much is this game actually cannibalizing Brawl Stars? Even though it has that more PVE focus, there’s still quite a lot of overlap when it comes to the nature of the games. That’s always been in my mind.

Kalle Heikkinen: And then the other one, is that when it comes to this record-breaking pre-registrations, I think a lot of it was driven by players wanting to get the free skin that they could get out of by clicking that pre-registration button. So I’m just wondering how many of those players did that? Just because of getting that skin. so that showed up, of course, the downloads, but how are they gonna, you know, are they going to stay in the game or go back to the other Supercell portfolio games?

Supercell’s China strategy and Hay Day relaunch

Kalle Heikkinen: And then another thing that is more of a broad, Supercell, notion, which is actually not that much discussed, I feel is that in addition to all these, It’s like, for example, Brawl Stars breaking records with their performance and, and some other titles they’re doing extremely well. Supercell has also been active in releasing games in China. Just a couple of months back, they re-released Hay Day. Nowadays, if you want to do a China launch, you need to partner up with a local entity. Supercell has also had to take back its games and then relaunch them. They’ve been doing that gradually. The latest one is Hay Day, which has been able to sustain itself in China.

Jon Jordan: I guess one of the interesting things with Supercell is, or one of the arguments would be, the sort of the scale aspect. I’m sure they’ve done it in their own Supercell way, but to me, a lot of that is just them catching up to what the industry has been doing for the last three years. And they, they’ve always been, we’re gonna do it our way and have these, you know, super sales, very small teams and not have producers and all this sort, and to a degree, as I say, I’m sure they’ve done it with their own style, I think it’s them finally having to admit this is how the market is these days. And we can’t just be an exception. so they basically copy the best practices of a lot of these things that they haven’t been doing. So, I mean, it’s good to see. So it’s not a criticism, but I think the differentiation companies have now to sort of do their own thing and stand out is sort of now almost impossible. People know how the industry works and you sort of have to get with the industry. If you’re going To be successful. And it sort of shows actually, you know, that They make great products. So you’d almost expect them to use best practices of the industry. They’re going to get that extra sort of boost because they really know their games.

Jon Jordan: So it’s good to see. Is it a good point on Squad Busters? I guess there’s so much going on there that they’re not. It’s good to get the launch out, but they can now take a much sort of longer term perspective on these things and sort of run them as a portfolio. And there’s not so much pressure on one particular game now.

Supercell’s IP and interconnectedness

Erno Kiiski: It’ll be interesting to see because, like the whole Squad Busters, the idea of the game is this connection of the, all the Supercell IPs, will there be more actual interconnection, other than just, of course, the IPs Start to do more of this like portfolio interconnection, especially most likely there are a lot of overlap with the players of Specific games in like Supercell portfolio, but at the moment it’s been of course the IP same characters but will there be more actually like Even more interconnection between those games. Of course, they have the Supercell IP and all that stuff. So Very interesting to see if there will be something like that.

Kalle Heikkinen: Will they go deeper to the characters and to the lore of the Supercell IPs because I feel that, like, Okay, I’m not the biggest Supercell player out there, but I do feel that it’s not the most, I wouldn’t describe the characters or the background lore of these games being the deepest when it comes to different IPs and stuff like that. So interesting to see if they’re gonna, dig deeper into that, part and expand the lore and background of the characters.

Jon Jordan: You mentioned Kalle there about cannibalization and how they place everything within their portfolio if you want to think of it that way, and I guess over time now, we’re just looking at, not many companies had the experience of running successful games over 10 years. And you realize how you run games and how you push things in certain ways. There is a sort of rhythm to that, and how you place games within those rhythms is probably pretty complicated. But equally, yeah, that inter-sort of connectedness, almost like a, not quite a meta-layer, that’s probably putting it to a complex point, but having games that fit into where other games are moving away from will be fascinating over the next few years to see how they play that out.

Kalle Heikkinen: Yeah, I guess in a way this is like a test to the Supercell IP, that how strong is it I’m not gonna say that, let’s say if Squad Busters is not gonna perform as well as everyone is predicting. I’m not saying that means that the Supercell IPs or the IPs of the different games are failing or anything like that.

Jon Jordan: It’s interesting as a company that their IPs, maybe with the exception of Hay Day, do feel like a very connected sort of selection of, Games and characters, and you know, I think that’s slightly accidental. They have tried other things in the past, but they have ended up with a game world, a Nintendo-type game world, where everything fits together. And not many companies in the world have that because it’s quite hard to do. So that’s another thing to look at on the IP side. Okay. But the mobile game industry is not just Supercell. So, should we break out of that and move on?

Asian publishers’ growing RPG presence in Western markets

Erno Kiiski: All right. maybe next, if we stick with the more, like, mid-core-ish titles, one thing that we have noticed, which is kind of interesting, knowing where the market is and how hard it is to scale, especially like this mid-core, hardcore type of games, is that if we look at like especially the U.S. market or the Western markets and look at the games that have been able to enter that top, top rankings for example, top 200 in the U. S. games that have been launching this year. So new games. So on, in 2024, there’s actually. many RPGs out there, considering the market situation at the moment. So, of course, AFK journey has a spin-off slash sequel to the highly successful AFK arena, an idle RPG with even higher production values, a bit of a different twist. They launched at the end of March. It has had a strong launch but has been going down a little bit, also not being able to sustain on the top, but still out there on the top 50 rankings. So doing okay, but maybe not as explosive a launch as somebody could have expected from AFK arena, especially what it was back in the day. So a little bit on a downward trend, let’s see, are they able to turn that one around. Then, there are other RPGs from Netmarble, who are pushing out so many turn-based RPGs, and especially with this kind of anime feel.

Erno Kiiski: If I understand correctly, there was this game called Solo Leveling: Arise, which is apparently an IP from a Korean webtoon. And that launched, I think, in May. Very strong launch, very kind of like a classic, what we see in the Western markets with this type of action RPG that has that huge spike. And then usually after the launch spike of this kind of like a niche audience they get that everybody’s all this is a game in the market, but it usually declines very quickly. But with this game, what is exceptional, at least at this point, is that it hasn’t gone down so radically, it is still able to sustain okay rankings, it has gone down. Yes, definitely. But it’s still able to sustain itself there. I’m in the top 50 and top 80 among the top-grossing games. So, it’s very interesting to see. Is it able to sustain itself for any longer term? It’s only been a month, but often, in these games, the initial launch spike has gone much more radically down in terms of performance. It remains to be seen, but at least so far, it has been able to sustain a bit better than your average similar type of anime-based action RPG in the West.

Erno Kiiski: And then there is the third one in the same category, Wuthering Waves, which is this kind of a cross-platform from PC mobile type of action RPG, again, anime-themed, pretty much a straight-up competitor against Genshin Impact. So open world, character collector, RPG, the differences in the combat, if I understood correctly, I haven’t played the game myself, this type of action RPG where you’re collecting characters, super high production values in Genshin Impact style, open world and all that stuff. Again, it had a quite strong launch, all the way to the top 10 and very top, but it had declined a little bit. But now again, when they brought the first, bigger content batch, at the end of June, a couple of days ago, if you look at Genshin Impact’s revenue graph, there is always a massive spike again when they bring new characters, back to the top, the same with Wuthering Waves. So, at least at the moment, let’s see where the baseline will find itself, but we’re doing quite well. We’re doing quite well, especially considering, again, it’s a game that’s cross-play. A lot of the players will be moving or will possibly play on a PC. PC with a bit of a better control for that kind of a game, but still doing quite solidly, after about a month, over a month of launch, in mobile. Overall, interesting to see that there are quite a few of these RPGs that have been able to sustain at least, over a month, in the market; a month is a short time. So what’s the long-term sustainability, but at least, some fresh blood on that section?

Kalle Heikkinen: And we have the, what? Zenless zone zero is coming, I guess. Yes.

Erno Kiiski: Yeah, Thursday, I think it’s 4th of July, a new game from miHoYo, so most likely will be on the very, very top again, like, you know, same as with Genshin, same as with Honkai, so definitely probably one of the biggest mobile launches of the year coming like in a couple of days.

Kalle Heikkinen: So, listening to what you just said, I feel like one of the trends of this year is most likely the anime-themed games, or at least anime-themed RPGs. Looks like we’ve had quite many of those. And I think one thing that links all these is also the fact that these all come from Asian publishers, right? So, I guess we can throw that out there as an example. I’m not saying that it’s been a trend for the last six months, but let’s maybe label it as an ongoing trend that the Asian publishers are just growing their presence in the Western markets.

Call of Duty Warzone Mobile: Cross-progression challenges

Erno Kiiski: Then if we move on from the RPGs, maybe the last that I would like to highlight in 2024 on the mid-core side, I would highlight Call of Duty Warzone, One of the biggest games on the PC and console side that there is, and the mobile version launched with cross-progression, which is also an interesting trend. We have been talking about cross-platform, and it’s, one of the trends that a lot of people talk about, actually cross-platform games and having the mobile version of the same game, But the difference with Warzone was that it wasn’t actually the same game in that way that you were not able to play against PC players or mobile players couldn’t play against the PC players and so on, but they had cross-progression. So there, you know, your progress vectors in the game that you’re collecting the weapons and progressing in the shared battle pass. So if you play on a mobile, and then hop onto the PC, that’s the same progression. So you are sharing that progression and, you know, can do the grinding on either platform.

Erno Kiiski: But then, if we hop onto the performance of the game, it’s not been very good. It’s struggling quite a bit. Of course, when it launched, it spiked there, but then it got down quite heavily. And nowadays, it’s not even among the top 200, like crossing games in the US. Compared to when Tencent published or developed Call of Duty mobile, it is still in the top 10,, still struggling. How are they able to get it? Players out of that mobile SKU that, you know, they have their players, they have their tons of skins already, haven’t been able to really pull off players from there. Not different enough. And also, if you compare it to like live ops machine, Tencent is able to kind of like push out on a weekly basis compared to what the Warsaw mobile is doing with the live event. It’s much slower, much more, and less content than Call of Duty mobile. So we’ll be interested to see what Activision is actually gonna, you know, keep the game alive, for a long term, because, at least in terms of performance, it’s not really, really doing it. But of course, there are the kind of like, might be, I don’t know how it has affected, for example, the PC side or like, are some of the PC players like, yeah, playing there, but all the monetization is happening on the chest of the PC client, for example, what’s that? So there’s that. It’s not visible on mobile performance, but yeah, to be honest, there’s no competition against Call of Duty Mobile.

Kalle Heikkinen: The only sensible thesis behind that is that they want to have the kind of mobile extension of the game so that people can also use it. Something related to Warzone, even when they’re not on their PCs. But other than that, as you said, it doesn’t look too good. But Erno, you forgot to talk about Love and Deepspace. So I want to mention this, of course, not maybe the biggest explosion when it came to long-term success. Nevertheless, this was one of the most interesting titles to hit the market, in my opinion. This is a hybrid dating simulator for anyone who doesn’t know what Love and Deepspace is. There are a lot of interactive story elements in the game, but interestingly enough, it also has an action RPG layer where you upgrade characters, and that’s a big part of the gameplay as well. In terms of performance, it is interesting that this was a successful game in multiple markets. So, in Japan, in China, and when it also launched in the U.S., I just looked at the data, and now it’s only peaking to inside the top 200 grossing, so it’s not sustaining there anymore. This was an interesting case and super high production values, by the way. The game looks absolutely phenomenal. So that was interesting and obviously comes from, I believe from China. So the publisher’s info Infold, I would assume that it’s from China, Hong Kong, or something like that.

Erno Kiiski: Yeah, when the game launched, it was at least, I don’t know how much of these types of games have been buried in Asian markets, but a game that was able to do okay in terms of launch of this type of. Pretty much an interactive story game, but with kind of like a depth of an RPG meta-system, which was very, very, usually you don’t see these games do anything in the West, but now it’s for a month or two, it was doing surprisingly well. So yeah, good highlight. All right. Should we hop on to the casual side?

Hybrid casual trends

Erno Kiiski: Maybe first we could talk a little bit about hybrid casual. And that’s also one of the trends, of course, hybrid casual, companies struggling with the hybrid casual model, moving to hybrid casual. And then also, these different types of, hybrid monetization models of different genres, adding ad monetization into the play and trying to get that Low CPIs in terms of gameplay to be very easily digestible, easy to get into, but then actually building it. So of course, it’s not like a new thing in 2024, but we have seen even more new games, different types of games in this, that could be categorized as hybrid as well. So, I would put these in two buckets. Are these real simple hybrid casuals, which have been mostly like puzzle games recently? If you look at IAP charts, as these are hybrid casuals, the whole point is that it’s hybrid monetization—there are ads, and they are IAPs. But even with just the IAP revenue, there have been multiple, different kinds of Hybrid monetized, hybrid casual puzzle games entering also the top charts with IAPs. And what is very interesting there is that there are a lot of different types of core gameplay involved. So there are games like Screw Jam, which is the game where you’re Screwing, screwing these jams and, you know, trying to figure out which screws you need to remove to remove this like block wooden blocks type of a puzzle game. Then there is another very similar game called Wood and Nuts, very well compared to those two games in that kind of core gameplay. Then there is a Twisted Tangle from Rollick Games, so from Zynga. Basically, these, like, you have these different ropes, tangled between each other and you need to solve that puzzle. A game called Hexasword, I think it was from Lion Studios if I’m correct, Basically this type of, different blocks of, piles of blocks that you need to move around and then figure out the same colors and stuff like that, but anyways, different types of core gameplay is like, if you think about the puzzle market or the traditional casual puzzle market, it’s very. There are specific types of core gameplay. It’s max three there. It’s merge or so on and so on, or like hidden objects and so on. And it’s always almost the same type of core gameplay. So what is interesting with this trend that we have seen with the hybrid monetization models and these types of games, there is a lot of, Variety in terms of like core gameplay, but what is common between these is, of course, a lot of them have like similar type of a monetization things for the IAP. So, you know, the usual puzzle things like a puzzle, like the boosters and the extra time or move or depending a little bit on what the core is like. Also, if you look at, you know, what makes them this hybrid casual, not hyper casual puzzle game is that they are adding more content, so more levels, on a specific cadence. And also, of course, it’s the live events and kind of like the live event framework that supports that core gameplay. So if you look at any of these types of games, the events that they are pushing on top of the game to give that kind of like more incentives to, for players to, you know, purchase things and play the game, engage players more into the playing the game. It is actually very similar to any type of puzzle game. So, that is very common, no matter what the core gameplay is or the event types and so on that support it. Across any type of puzzle game, whether it’s Royal Match, Match Three, Garden Scapes, or these hybrid casual puzzle games, many similar event types and event frameworks are used to push players for the core gameplay. So this is definitely one kind of a clear genre, these hybrid casual puzzle games with different types of core gameplay. How do you actually play those puzzles and solve those puzzles?

Erno Kiiski: And then the second bucket that I wanted to mention is this. What people still call hybrid casual, which is this Survivor IO type of game or Archer type of game. Both of these genres are commonly called hybrid casual in the industry, but they are very, very different in that way. If you play Survivor IO, for example, yes, it starts simple. The whole idea is that you can make very appealing, easy-to-understand games. ads and so on. But then when you play for it for a week, for example, then the game actually has the depth of any mid-core RPG in terms of features, in terms of different ways that they are monetizing those meta-features and so on. So this is like a different bucket of a hybrid casual. So yes, they are also monetizing hybrids. Insane amount of depth, in terms of its features, once you get deeper and deeper into the game, and there have been a couple of games, for example, this quite recent game, has been scaling goals. Some zombie.io, which has been, it’s basically a survivor IO type of a game, but it has a lot of innovative features. You put even more effort into a character collection and build a team, and then that affects the core gameplay. They have tons of depth into the game. It has 10 different progression vectors. So different ways that you can get stronger. And then, when you start the game, it’s like, ah, this is nice and easy to get into, but it is like a crazy amount of depth. And then of course, everything is almost monetized, both with ads, both with, you know, IAP. So there’s also a crazy amount of spend depth over there. So, one game in that category has been scaling and doing some innovative stuff. Over there, to follow.

Kalle Heikkinen: Okay, I have to say, you kind of stole my thunder when it comes to the hybrid casual stuff, that was really thorough, going through all the highlights of what is going on there. But I’m just trying to think of what I could add to that. And I guess I’ve always struggled with the definition of hybrid casual. Sometimes, it feels like if you have a game that monetizes both on IAA and IAP, that’s a hybrid casual. And if that’s the case, then you can. That’s a pretty vague definition. And then on the other hand, some people defined it as being like a combination of. mid-core, even hardcore elements in game mechanics-wise, but then combining that with a very casual, let’s say, art style or something like that. And there are other ways to think about it as well. So, I always struggle a bit with the definition, but nevertheless, I think the last six months have really proven that these hybrid casual games are able to not only break into the top 200 grossing but also sustain themselves there. So, for example, some of the games that Erno mentioned, like Twisted Dangle, that was released last December, and It’s still in the top 200 grossing, so, the formula has been kind of proven now. It’s not only about Archero anymore. a couple of years back when people asked, for example, for us, more analysis on hybrid casual games. We were like, well, there’s Archero and what else is out there? But now the market has definitely expanded.

Jon Jordan: So it sounds like it is interesting where you have the very casual starting experience to sort of encourage many people. And then you’re sort of filtering through that. And I guess at an original point, we would think when people play those games, some are going to monetize through adverts, and some are going to go through in-app purchases, but maybe as they get more complicated, the split between the monetization changes as people get further into the game. So you want to have those deep retention mechanics, you know, towards the end, simple at the start. And then, that’s sort of how that genre is expanding. But maybe some homework, come up with a new definition while you’re, Do a stamp on the industry.

Jon Jordan: I’ll make a note. There is lots of stuff going on there. It is funny how much of it comes back to thinking about LiveOps. That always springs out to me as you’re talking about these games, and the whole industry is always getting more and more deeply into live ops and even into what we might call casual experiences. And anything else that we have to add to this?

Microfun and merge games

Erno Kiiski: I think Kalle knows the company better, but I would if we talk about the more mid-core. I’ve talked about Supercell, but maybe you could talk a little bit about Microfun.

Kalle Heikkinen: Yes. So, Merge Two is definitely one of the genres that has been doing extremely well this year. It is mostly driven by games like Travel Town. Then we have Gossip Harbor and Seaside Escape from Microfun. That company’s interest comes from China, and they clearly have this portfolio strategy. They do in-game cross-promotion, so you have these events going on where they advertise the other games in the portfolio so that if you download those games and engage with them, you get rewards in the app where you downloaded those games. That’s obviously a very clever way to move players around. Some studies have shown that People often have more than one merge game on their phones when it comes to the merge genre. So it makes total sense to advertise that they have, for example, merge three games also in their portfolio. So I have kind of a couple of different Takes on the merge and advertising them, pushing them to certain players can be very effective and for Seaside Escape and Gossip Harbor, that has been very beneficial. And also, on the product side, they’ve been constantly updating these titles; for example, Gossip Harbor, they added a race event just a couple of months back, which was, of course, interesting. We haven’t seen those much in the. Merge to side and, in general, in non-level-based games, not so much. For example, this was, I think, already from last year, but they have this, like a relationship, progression mechanic there where you can build your relationship with some of the in-game characters and, Have a progression vector attached to that not only Someone could say that Gossip Harper is very much inspired by Love and Pies but you could also make the argument that they have been trying to innovate and Add, new things to the game and also to the merge to genre in general.

Erno Kiiski: It’s kind of interesting in that way. I feel that it’s a company that hasn’t been talked about that much yet because, but, like, if you look at any of these games, like Gossip Harbor, it’s basically been doing bigger month, bigger month, bigger month in terms of revenue one after another. It’s a game that has been scaling constantly. And then, you know, nowadays it’s like among the travel town, which are advertised like moon active, I guess, nowadays owns the game and they’re advertising the game like crazy. But Gossip Harbor is a game that’s basically clear number two now in the merge two category; there’s Travel Down there’s Gossip Harbor. The second release, Seaside Escape, is another game from the same genre and company. It’s now also been scaling a lot. So, they are becoming a very interesting company in that genre. Gossip Harbor was, very much like Love and Pies, but they have been, again, Gossip Harbor has been pushing so much LiveOps into the game compared to maybe their competitors like Love and Pies, So a lot of, different types of events, not all of them, have been super innovative in that way that, you know, there are proven mechanics seen in the other genres, you know, like, for example, I think they just added this kind of like a Potion event that, I think Royal Match brought the end of last year or so and now Gossip Harbour brought it. But that was the first time in the Merge Two genre. So they are scaling a lot with the live events and a very interesting company that, yeah, is not talked about a lot, and it’s not very out there. I think it’s China-based, right, Kalle? So there is not a lot of information about the company out there, but in that genre, it is very much a scaling one.

Jon Jordan: LiveOps again. We keep coming back to it, but that’s sort of what it is, isn’t it? I mean, it’s always been that thing with mobile games. People have it on their phones. It’s always there. They always want something new. It’s hard to move people from one game to another. So you want to keep them in your game. If even Supercell doubles down on LiveOps, that’s the thing. Cool. Good. Well, that was a very good overview. Thank you, very much to Erno and Kele for their expertise.

Kalle Heikkinen and Erno Kiiski: Thank you.

Jon Jordan: Plenty of games to be checking out there. I haven’t heard of a few, so maybe the homework for everyone is to check out some new games and see how you get on with them. But thanks for listening to the podcast. Every episode, we discuss what’s going on in the world of mobile games. So don’t miss out, do subscribe, and we’ll see you next time.

Introduction

[00:00:00] Jon Jordan: Hello and welcome to the Mobile Games Playbook. Thanks for tuning in for another episode. This is a podcast all about what makes a great mobile game, what is and isn’t working for mobile game designers and all of the latest trends. I am your host, Jon Jordan. In today’s episode, we are looking at what’s going to happen in 2024. So, it is very exciting to have you join us as our experts in what’s happening. We have Wilhelm Voutilainen and Kalle Heikkinen, who are both Chief Game Analysts at GameRefinery by Liftoff. How’s it going, guys?

[00:00:33] Wilhelm Voutilainen: Yeah, it’s going really well. Thanks for asking. It’s really snowy here in Helsinki, so I love it.

[00:00:38] Kalle Heikkinen: All well, Jon, thank you.

[00:00:41] Jon Jordan: I was just in Helsinki this week, and I was surprised how cold and snowy it was. So there we go. Good. So, I mean, this is pretty straightforward. These are always the exciting podcasts to do, then looking forward to the crystal balls and what’s going to happen and all that stuff because no one knows if you’re going to be wrong. We can always listen back in six months’ time and see how right you were. But this is the fun stuff. So I think I’m going to kick off with some games to look forward to. That’s always the most interesting bit, isn’t it? We have some titles in mind that we’re looking forward to playing. Who wants to start us off on those?

Racing games on the horizon

[00:01:52] Kalle Heikkinen: I can go first. So, yeah, I think we could start with a genre that is not discussed that much in the mobile scene. So racing. So there’s a new title coming up, getting a global release, hopefully, next year, that is called Racing Master. It was launched in China this summer and has had a relatively good year thus far. So, Racing Space is something that has been quite stacked in recent years, but this is a title that could bring some new blood to the genre. So, it comes from NetEase, and Codemasters has also been collaborating with the game, and it looks just gorgeous. And yeah, just a couple of things to highlight about that one is that it has a very strong focus on a story-based carrier mode, which is quite interesting. There are a lot of customization options for cars. And I guess one interesting tidbit is that the game gradually suggests the player lower the level of control assistance as he plays the game more and more. So that’s kind of an interesting one there.

[00:02:40] Wilhelm Voutilainen: Yeah, I think like we have been definitely waiting for like a huge racing hit to finally come to the Western market, and yeah, I agree that Racing Master looks beautiful, and of course, there’s like other upcoming racing games, too like Disney Speedstorm for example more like arcade racing game from Gameloft that is actually looking quite good as well. I think it was supposed to be released this month already, but I think they postponed it to the January of 2024. But yeah, maybe we will finally get something going on in the racing space in the West.

[00:03:18] Jon Jordan: I guess it’s one of those genres that can be quite hard to innovate in because you either go down the hyper-realistic route, which is what everyone wants. Basically, people who make those games are normally massive petrolheads. So they want to make the most realistic thing, and then you end up with something that’s so realistic that hardly anyone can play it. And that doesn’t fit so well on mobile compared to PC, does it? So I guess then you’re like, how are we doing that with the arcade? I guess from a design point of view, you’re much more limited than you maybe would be in other genres. So maybe just go from you and say make it look amazing.

[00:03:53] Kalle Heikkinen: That is true. Or then you just have to take the theme and bring it back to a totally new genre, like they did with Chrome Valley Customs and MasterTree.

[00:04:12] Jon Jordan: Cool, Wilhelm, one from you. What have you got for us?

Anticipated RPG releases

[00:04:15] Wilhelm Voutilainen: Yeah, so I think we could look at the upcoming RPGs. So, of course, the RPG space has been interesting pretty much every year. Last year, we had Diablo Immortal and lots of other interesting games as well. But some upcoming ones are definitely interesting, such as Lost Ark Mobile. So Lost Ark used to be a really popular game when it was released on PC. So it is kind of like a top-down MMORPG type of game that used to be really popular in the West; I think it’s still really popular in Korea. So that’s going to be interesting when it’s going to be released on mobile in the West. Same for Path of Exile. So, one of the biggest competitors for the PC Diablo games is this kind of interesting free-to-play game on PC, but having no pay-to-win, so paying for convenience. And I think it’s going to be the same. I think the unknown is that it’s going to be the same on mobile as well. So, it’s going to be really interesting to see how they will compete against Diablo Immortal, which has these pay-to-win elements. And of course, the monetization challenges then, if we look at, because all of these games, all of these upcoming games, these Lost Ark and Battle of Exile, they are both single-character RPGs, so you’re not forming a team of characters. And those traditionally have not been that successful on mobile because it’s really hard to monetize them. All the top monetizing RPGs are character collectors. You collect the multiple characters, you form teams. So Diablo Immortal was thethe only success in a long time in that sense. So, well, it’s going to be interesting to see how Lost Ark and Battle of Exile will do on mobile.

[00:05:56] Jon Jordan: Hmm. I mean, do you think they are obviously, to some degree, competing with Diablo Immortal for an audience? And they are that game now old enough that there’s all of the people who have had been playing that not had enough, but they like hungry now for a similar or not similar experience, but another RPG that’s going to be deep, and I know.

[00:06:19] Wilhelm Voutilainen: Yeah, I think that’s a good question for sure. There might be players, of course, who are hungry to play Path of Exile, for example. But then, on the other hand, there are deep progression layers in Diablo Immortal. There’s also players who are super invested in Diablo Immortal. They have spent their time and their money on getting this massive progress of characters, so it might also be hard for them to swap.

[00:06:47] Jon Jordan: Yeah. You just don’t often see games that are growing the market rather than just competing within the market. I mean, I guess that’s always the great goal for game designers is to take a genre and expand it because that’s when you really get success rather than just like, oh, the cake’s this big, we just need to take a bigger slice from someone else. That’s a harder thing to do, isn’t it? And okay, so I guess another traditional IP coming to Mobile is Assassin’s Creed Jade, which should be great, shouldn’t it? Isn’t that what you’re going to tell me?

Assassin’s Creed Jade

[00:07:25] Kalle Heikkinen: Yeah, yeah, I guess this connects to the RPG side of things as well. So definitely one of the most interesting games to follow next year. But at this point, there’s actually not that much to tell about the game. Of course, we’ve seen some videos of the gameplay, and it looks exactly what you can expect from an Assassin’s Creed title. So I suspect that side of things they probably can nail. And the game looks very good, of course. But definitely, it will be interesting to see what their monetization approach is going to be with this game. What kind of social elements are they going to have there? And most importantly, I would say that what is going to be their level of commitment to the live operations of this game? And yeah, it’s actually interesting to look at the history of the Assassin’s Creed franchise on mobile because that’s quite interesting. Technically speaking, this is their 17th attempt on mobile with Assassin’s Creed when it comes to Ubisoft. But of course, many of those games were spin-offs of premium titles back in the day, like 2010, 2011, 2012, and stuff like that. But also, just recently, a couple of years ago, they tried making, for example, the runner game with that IP with the Assassin’s Creed free runners. So, it definitely seems to be an IP that they want to utilize on mobile as well. So let’s hope that they get it done with Jade this time around.

[00:09:08] Jon Jordan: I can’t say I’ve played all those 17 games, I’ve played some of them, but would you say this is much more like the type of Assassin’s Creed you’d expect on PC console on mobile, which they’ve, did you say they’ve tended to do things, genres within Assassin’s Creed that would clearly work well on mobile? They’ve not, really, it’s obviously very expensive to make these games. And so I guess that’s the interesting point for this one. This is like a console-type game for mobile.

[00:09:20] Kalle Heikkinen: Definitely. Definitely. So the marketing for this so far and the scale of things, if you look at the videos and stuff like that, it looks like that level of focus for this game is on, it’s something else when it comes to the stuff that they’ve done previously on mobile with us. So, yeah, it’s a very interesting one to follow.

[00:09:58] Jon Jordan: And I guess, as you also say, the tricky thing is not necessarily making the high-end game that fits there. It’s that success on mobile really comes through live ops. And as you highlighted, that’s not very clear. And that’s, I guess, sometimes what console developers have not understood. They’re just not set up in the way that mobile developers are to really optimize those live ops.

[00:10:23] Kalle Heikkinen: Yeah, that is the biggest concern I would personally have when it comes to the long-term success of the title. But as I said, there’s so little that we know at this point, so it’s really speculative still.

[00:10:41] Jon Jordan: Yeah, but certainly one you would think there’ll be headlines of when that game comes out because every Assassin’s Creed, it’s almost everyone wants to check it out even if they sometimes you get the feeling some people want to check it out to criticize it, which, but yeah, it will always get plenty of downloads.

[00:10:54] Kalle Heikkinen: Yeah. Exactly.

[00:11:01] Jon Jordan: Cool, what are we onto next? Wilhelm, you’re gonna talk about some more RPGs.

Survival MMOs: Earth Revival and Fading City

[00:11:06] Wilhelm Voutilainen: Yeah, so I think, like, because now we’re talking about this really high production value, like almost like console experiences. It’s interesting to look at, like some other upcoming titles. So you have Zenless Zone Hero from miHoYo coming. So it’s going to be a similar game to Genshin Impact. But it’s more like this non-open-world game. It’s more about RPG action, where you’re playing like these smaller instances, but it looks, of course, it’s a miHoYo, so it looks the game looks amazing. You have another kind of similar games as well, Project Mugen, so it has a similar style to it also, I want to highlight here that what’s really interesting is that the themes of the games are a bit different than your usual RPG. Instead of being the fantasy team or sky-fighting, they are more about this street fashion team. I think this is also starting to rise in popularity in Japan and maybe in China as well. So it’s an interesting team to look at for sure.

The third really high production value is Wuthering Waves, which looks quite similar to Genshin. So it’s really interesting when they get released next year. And really, the big thing in those games, and like in many other of these games that we have mentioned already, is the cross-play. So cross-play has been growing in popularity. And I definitely see cross-playing being a huge trend in 2024 as well with these upcoming games. You have lots of benefits. You are unifying the console, PC, and mobile audiences. And it also helps we’ve been talking about the app store fee bypassing the web stores. So you can better utilize those as well. So it’s, well, the cross-play AAA titles coming to mobile. It’s an interesting thing.

[00:13:13] Jon Jordan: And would all those three come from APAC developers as well? So that’s because they’re just so expensive to make those titles that you want to be making those from slightly lower-cost regions.

[00:13:17] Wilhelm Voutilainen:  Yeah, yeah.

[00:13:30] Kalle Heikkinen: That would have been actually my question to you guys: what’s the common link between these titles that were just discussed? So yeah, they all come from Asia. I guess my question is, is it so that nowadays, Asian developers are the only ones who have the muscle to compete in this RPG space, which seems to require that the expectation levels are so high for this genre that – Are they the only ones who can deliver nowadays?

[00:14:04] Wilhelm Voutilainen: Yeah, and then you need to nail kind of having the AAA game, plus having the extreme mobile live ops combination actually to be super successful. So you need lots of production value for that.

[00:14:15] Jon Jordan: It’s even more expensive. And I guess the other thing is that people are interested in that because they’ve seen the success of stuff like Genshin, which was, obviously, an amazing game, and it cost a hundred million dollars to develop, but the success was amazing. It was really an outside success. As soon as you have one of those people, are prepared to invest that amount of money, or some people had to invest that amount of money to try and repeat it, but after a few people don’t repeat it and basically end up losing a lot of money, then people then look for another opportunity maybe, so maybe next year will be the high point of these super expensive 3d RPGs, and or if they’re successful, everyone will be making more of them, I guess one on the other. Okay, what else have we got? Um, Kalle, you want to talk about two games, Earth Revival and Fading City. Tell us about those and why you think they’re interesting.

[00:15:08] Kalle Heikkinen: Yes, yes. Just brief mentions about this one. Earth Revival and Fading City are two China-originated survival MMOs, so we are still continuing on the RPG tip here. Coming to the global market next year, Earth Revival is actually from NetEase, which has a very, very strong influence from the Last of Us series, like evidently there. So why I want to mention these titles because the main reason is the fact that there are publishers and developers out there that are obviously looking at AAA titles, and these developers see this as an opportunity to leverage those IPs indirectly. So, I guess what I’m trying to say is that if you’re an IP holder of a popular gaming franchise, you don’t have a mobile presence. Well, guess what might happen. It might be that someone else will fill the void for you. And I’m afraid that these cases that I just mentioned, they won’t be the last ones that we’re gonna, we’re gonna see. So, of course, it will be interesting to see when these are globally launched, will they bump into some legislative issues, for example, because it is with these titles like I was looking at some trailers that they had, for example, from the Earth Revival, which is the Mass Effect kind of game. Like the editing on the trailers and stuff like that, it’s exactly the same as the trailers were for Mass Effect 3 back in 2009 or something like that. So it’s interesting to see if we’re going to see more of this. Let’s just put it that way.

[00:17:12] Jon Jordan: Mmm. Yes, I guess it’s you probably can’t copyright. If it gets there’s other things you probably could do, isn’t there?

[00:17:52] Kalle Heikkinen: Yeah, yeah, it’s like where you draw the line, but yeah, I would just say that, like for all the IP holders out there that like we’re gonna see some, I think we’re gonna see some interesting discussions going forward when it comes to this type of cases.

[00:17:45] Jon Jordan: And do you think, can those, you say those are from Chinese developers? So, is it enough that those games could just be released in China, which would obviously maybe curtail some of the copyright issues, and people just go, everyone’s already in China knows it’s inspired by Mass Effect or something, but there’s a different thing if you go global with it, I mean, I guess they could just be successful within China, but maybe if they’re, they’re being more aggressive in their attitude and they go well of course we’re going to be global?

[00:18:16] Kalle Heikkinen: Yeah, that’s a good point. Earth Revival has already been launched in China. It’s a top 50-grossing game title there. Yeah, it was just launched, I think, like one month ago or something like that. And yeah, it’s very successful there. So, yeah, I definitely there’s a point there that operating these games in China, probably from a legislative perspective, is much easier than when you then release them to the global and especially Western markets. So I think when that happens, yeah, let’s see. Of course, I haven’t played those games personally, so I’m not 100% sure what kind of things have been copied exactly, but looking at videos and trailers, it’s very easy to see what has been the source of inspiration for these games.

[00:18:21] Jon Jordan: Oh, is it? Okay. We’ll see, but you said it’s influenced by and inspired by others. This is a whole different debate. Everyone’s influenced by something, and it’s where it’s a case where the line is crossed. Moving on and talking about global launches, you want to speak about the Honor of Kings. I thought Honor of Kings was out ages ago, but you’re saying Honor of Kings isn’t out globally?

Global launch speculations: Honor of Kings

[00:19:27] Kalle Heikkinen: Yeah. Yeah, this is a confusing one. This is a super confusing one. So why I wanted to bring this up is that apparently there are again rumours that Honor of Kings, which, if there’s someone who doesn’t know, is one of the biggest mobile games in the world, at least if you think about the games that have crossed the most. So, there are rumours that it will get a global release in 2024. Honor of Kings was launched back in 2015 in China, and it’s been a success story, as I said. Always been a top one-grossing game in China, practically. And a Western version of Honor of Kings called Arena of Valor was released back in 2016. So that’s what gets us very confused about this one. But that never received really great success that at least would be comparable to Honor of Kings in China. But this new global version of Honor of Kings was soft-launched actually in Brazil last summer. You can take a look at some numbers and performance numbers of the game. They’re pretty modest when it comes to revenue and downloads. So yeah, it’s really has been in the soft launch there for six months. So let’s see what’s gonna happen. But the rumours are that they’re gonna make a global launch, launch. So let’s see. But personally, I’m just a little bit confused about Tencent’s plan here. So are they going to run both Arena of Valor and Honor of Kings in the West? Or will Arena of Valor be killed at some point? Or will the Honor of Kings Western version ever actually be globally launched? The mobile scene is very hard to enter, but I guess if someone can do it, then Tencent, of course, has the experience and resources to execute it. But then again, they missed those expectations with Iron of Valor already. So I’m really confused about this myself as well.

[00:21:38] Wilhelm Voutilainen: Yeah, I don’t know if Valor, it used to be in a kind of high ranks at the launch, at the beginning of the game, but obviously now drop away. They have really slowed down with the live ops of the game and the updates. There’s only like a couple of updates, new content per year, and they have really slowed down on that one, but well, it’s interesting to see how it does against Mobile Legends, Bang Bang and The Wild Rift, so two of the biggest mobile games in the West on mobile, so.

[00:22:10] Jon Jordan: But I guess if it’s just that they can consolidate the live ops and just have one live ops team doing both and that maybe that’s enough to, give it another try.

[00:22:19] Wilhelm Voutilainen: It kind of makes more sense to also have the same game with the same name as well, because they don’t feel so separate titles. So in terms of like, let’s say eSports, which is big in these mobiles. So, yeah.

[00:22:33] Jon Jordan: Yeah. Okay. One to keep an eye on. Good, good. What’s next? So, Wilhelm, shooters. We’ve talked a bit about racing games, but shooters are a perennial genre where everyone’s launching and loads of stuff going on there. So what are we looking there?

Exploring shooter games in 2024

[00:22:49] Wilhelm Voutilainen: Yeah, so yeah, Shooter’s definitely one of the hardest to enter. Still dominated by the big three games, Call of Duty Mobile, PUBG and Free Fire in the West. So there are really promising games coming in 2024. First of all, Warzone Mobile, which I would say is the game’s strength. So I would say that would be successful because it will have a cross-progression Battle Pass it has with the PC version. And of course, the PC version is an extremely popular game. So I think instead of directly competing against the mobile audience and against those big three, it can definitely bring the code Mars on PC players to mobile. Let’s say you have the Battle Pass plan, which is, by the way, in the PC version. It really takes time to progress because it’s a time-based progression battle pass plan. So you progress it by just playing the game, like, so time-based battle pass plan, that takes a lot of time to progress. So I personally wouldn’t really mind to sometimes, hopping on my couch, playing some Warzone Mobile and continuing the battle pass progression there so I can actually finish the battle pass in time. So I think that’s a big strength that can really, really work for them.

[00:24:16] Jon Jordan: It’s going back to your cross-platform thing, isn’t it? Yeah. The importance of cross-play is that it just gives you an embedded audience there, so immediately, you’re adding benefit to those people straight away.

[00:24:29] Kalle Heikkinen: And I was thinking that… Yeah, I was just adding that. At first, I thought that it make sense to cannibalize the Call of Duty mobile audience, but then again, I guess maybe it is more beneficial to have the players play the Warzone more than the Call of Duty mobile. I guess with Call of Duty mobile, was it Tencent that is the co-developer there? They get a certain cut out of the profits there. So with Warzone, they’re going to get all the cash for themselves. So maybe that’s something, too, to incentivize them to focus on Warzone.

[00:25:11] Wilhelm Voutilainen: And then, some other games, so Valorant and also Rainbow Six. So, more of these tactical shooters are slower-paced games compared to the other titles; the movement is slower-paced and more tactical. And of course, the time to kill is super fast, but, it’s really tactical. So I would say like right now there is. none of those kind of games in the really high-grossing ranks. I think the highest-grossing one in the Western/ West market is the Critical Ops, which is, I think, is an amazing game. And I personally think those games are one of the best shooters, one of the best shooter genre that works on mobile because of the slower pace and more tactical movement that really works on the works better on the touch screen, I would say. So, like, for example, Valorant, it’s a massive IP nowadays. It’s a super huge success on the PC. I don’t know if they maybe they will do similar. So I have cross-progression battle pass plan that would really work for them.

And then, of course, lastly, I want to really mention the Division Resurgence. So a looter shooter type of game. We have not seen a looter shooter in a long time, like being successful in the West, or on the mobile in general, I’d say. I think it’s going to be tough to make it work, because balancing this power progression shooter, can be really tough. How do you balance the gameplay and the monetization parts? There has been one game that has kind of made it work. So, Pixelcom 3D, one of the actually oldest shooter games on mobile there is, that is still live and going really well. They actually have a pro progression element. So, they have been able to make it work. So, Division Resolution, I think they have a chance at it.

[00:27:05] Jon Jordan: Okay. Good. So so plenty to go on.

[00:27:07] Kalle Heikkinen: I guess as a bonus I’m going to throw in just High Energy Heroes from Tencent. So we all know Apex Legends was cancelled, and killed in the West, but Tencent actually made a very similar-looking game, launched it in China this year called High Energy Heroes. If you look at the UI, it’s very similar to Apex Legends and stuff like that. The art style and aesthetics are a bit more leaning towards Asian anime looks. So it has performed pretty well in China still, I think in the top 50 grossing. So of course, like there’s no, I didn’t find any evidence that it would get a global release. But who knows? Maybe, maybe it could. But yeah, definitely When talking about new shooter games, it’s a game to keep on the radar.

[00:28:07] Jon Jordan: Again, to all playing going back to what you were saying about looking at gaps in markets where existing games, clearly in this case, there isn’t going to be an Apex Legends mobile because it’s dead. So for a team like Tencent, who probably got loads of developers, it’s worth a punt, isn’t it? I mean, probably maybe other High Energy Heroes. I mean, that could work in the West, couldn’t it? It’s maybe not the strongest, but we’ll see. Good. So plenty going on with shooters. Let’s get into some trends. Always talking about LiveOps. So hopefully, Kalle, you have a lot to say about LiveOps in 2024. What have you got for us?

LiveOps trends in 2024

[00:30:07] Kalle Heikkinen: Yeah, yeah. So let’s start with the obvious. So the cost scope and importance of LiveOps will obviously grow also in 2024. So if you’re launching a new game, the sad news is that all your competitors already have their LiveOps machines running. So you really need to have that LiveOps strategy in place. To be more specific, we’re seeing a lot of promotional collaboration events. So IP collaboration events in games and being very important part of their LiveOps palette. So for example, this year we see a lot of interesting ones in games like StumbleGames, for example, with Monopoly events and Barbie collaboration events. And whenever I speak actually with our Honor of Kings analyst, so we mentioned Honor of Kings already in this podcast, she always says that there is some exciting IP collaboration event going on. And then, would you, Wilhelm, agree with me that events, just in general, are becoming more surprising and exciting? So like putting out events that are like, just collect 10 pieces of golden candy and then, reach this threshold and get a reward. Uh, it’s just, it’s, it’s like, we’ve seen that and what, what is really resonating right now is that we’re seeing more of these like more non-traditional events and mini-games events and stuff like that.

[00:32:15] Wilhelm Voutilainen: Yeah, I would say that definitely the production values of events are getting higher, especially in this newer type of events. So, comparing, as Kalle mentioned, comparing a single simple task event where there’s literally just a task, do something in the core gameplay, get points, and get rewarded. Comparing that to an event, let’s say, where you do something in the core gameplay, then you play, let’s say, a mini-game with that or build something like the event meta game or something, or even have an interesting UI or a theme, it make it so much more interesting and engaging for the players. Some really good examples are phase 10, they run these themed events every month and they have exactly that. So there’s always a new mechanic tied to the event loop and a new team as well. And also like this more of this interesting one of them. One of the events and going like taking trends from other games like Lily’s Garden, they have run this makeover event. So it’s kind of liketakes inspiration from the project makeover. And instead of just, you playing the match three core gameplay, you’re getting points and rewarded, you’re playing match tree core gameplay, then you’re using the points you get from that to kind of like do a makeover for the game’s story character. And depending how far you get into the, in the makeover, the end, the story ending of the event gets better and better. So there are lots of these interesting elements to it compared to, traditional task event.

[00:33:54] Jon Jordan: Hmm, hmm. Definitely plays into the cost, scope and importance of live ops. It’s kind of crowed when it just becomes a, yeah, game within itself or, special, extra special rewards. I mean, that’s just that everything is becoming complex. It’s interesting, you said, Wilhelm, that a lot of those ones are social as well, the events now, so you it’s not just about you. It’s all about deepening the core community of the game by embedding people into things they’re doing together.

[00:34:19] Wilhelm Voutilainen: Yeah, you have social elements, you have meta elements, you have a story, many of those, and interesting stuff for sure. And then another trend is definitely, I would say, in terms of events, is the games are finding new ways to monetize their events. So like we’ve had, we’ve seen past year, we’ve seen lots of premium reward tracks in events. So like this mini parallel passes inside events, monetizing some of the events rewards.

And then we’ve seen that becoming more popular. And then we’ve also seen this kind of like event boosts. So boost doing something or purchasing something to boost your progression inside the event. That’s usually what has been happening lately a lot. If you have this event skin or this event character, your progression during the event is doubled. So, for example, Modern Warfare 3, which just got released on PC, is running events like that right now. So if you’re purchasing a single one unique operator that is promoted in the event, your progression is faster. But, so those are kind of like what’s already going on, but then what we have just recently seen, and I definitely see this becoming more popular in 2024, is this kind of like this pay-gated content. So events are locked behind a paywall. So, for example, Last Fortress is one of the top Forax Surge games. You have to purchase this premium building in the game to actually access at this mini-game event. So the only way to access an event is to purchase this premium building, which costs $50. Then on State of Survival, another super successful Foraxes, they had this Resident Evil collaboration event. And to play some of the events inside the huge set of events you actually had to pull, this represents an evil tractor from a gatcha. That’s the only way to participate in the event and get anything, and then the last really interesting example, Free Fire They had this top-up event. So top-up events mean that you have to spend or purchase a certain amount of premium currency in the game, and that way you would unlock this huge set of different events. So a whole massive set of events was locked on you spending or purchasing premium currency. So pay gated content is definitely gonna be a trend.

I find that very interesting because it’s like going back to the roots of the live ops in like AAA premium titles. I see this as a form of a DLC where you have gameplay content locked behind a purchase or a paywall. Of course the mechanisms are here not so straightforward and stuff like that but it’s like DLC in a sense.

[00:37:17] Jon Jordan: Definitely, that sounds like one to look forward to. Well, check out how it’s happening in 2024. And then last one, I guess we wouldn’t be allowed to do a podcast like this without mentioning AI. I don’t know how deep we want to go into it because it’s, I’ve just, there’s obviously very obvious things we understand about gen AI and how that’s impacting the sector. But I guess none of us are deep experts to exactly wheedle out. So, what’s exactly going to happen? But how do we think AI is going to, GenAI stuff is going to change? Is it, I mean, maybe the contrary thing, is it actually going to change stuff in 2024 or is, or is it just speeding up game development and making stuff cheaper and we don’t actually notice it in games per se? What do you think?

The role of AI in 2024

[00:38:00] Kalle Heikkinen: Yeah, it’s like you said. We’re definitely not the experts, but it’s always fun to speculate. So let’s speculate. So, but yeah, I think it’s of course, like talking about 2024, like you just have to touch upon the topic of AI, I guess. And it surely has replaced blockchain and metaverses, the gaming industry passwords, right? And rightly so. I mean, the potential to disrupt how games are made is, frankly speaking, huge. So if we, for example, think about the high-level implications and what it means to the industry, developing games will get much quicker and much less complex. And I’m not saying it’s necessarily a bad thing, obviously, but it’s already, if you think about it, it’s already ridiculously hard to find an audience to your game. Like every day there’s 500 games released to the Apple App Store. There’s 40 games released to Steam every single day. And with AI coming into the equation, I think these numbers will explode. So it’s going to be really interesting to see how this will affect the marketing side of things and the UA landscape when the competition is going to get even fiercer and fiercer.

[00:39:18] Wilhelm Voutilainen: Yeah, and of course, the UI is a really good point for sure. And, of course, creating game content might become much easier and faster. So of course, might affect live ops; I don’t know if we’re gonna see all the casual games have massive live ops like Cod Mobile or something like that. Maybe we will see something like that. And also, talking about just, the scale of games that you can create. So we talked earlier about the Genshin type of games, which require a massive workforce to create all those huge worlds and the content there. So if that becomes easier, you can scale massive worlds. Could we see more of these open world type of games in the market? Could we see maybe the MMORPG tournament doing a massive comeback in the future? Can we see more of these metaverse types of games actually coming to live? I don’t know if it’s gonna be already in the 2024, but forward to that, yeah, might, might something interesting what happened there.

[00:40:24] Jon Jordan: I guess it’s whether AI just allows people to speed up what they’re already doing, which obviously it will do. Is that going to be the core result, at least in 2024, or is it going to allow totally new sorts of content to be made that couldn’t have been made before? Which I guess is harder because AI probably won’t come up with that itself; maybe it will. But there’s a lot of things to come up with. So is it just accelerating existing trends? Or is it coming up with totally new things? Yeah, that’s the… And I guess people, definitely people would be trying to come up with totally new things.

[00:40:56] Kalle Heikkinen: One thing I want to add to this that at the GameRefinery we’re obviously always on the lookout for any evidence of AI-generated content in games. In China, we actually we’ve seen it in use as the top MMO in the market called Nishui Han, which is from NetEase. So they have used these large language models to generate at least a certain amount of the narrative content that they have in the game. So they have used this; they have used AI to help them design the narrative there. So, yeah, will be, will definitely be interesting. And then I guess what I also believe is that this will probably result in even faster copying of game features and art styles and all kinds of assets that we have in the game. So, if you can just make prompts like, please generate a Clash Royale-like battle pass for my game and one click and it’s there. That’s going to be quite groundbreaking.

[00:42:12] Jon Jordan: Yeah, I guess also the other thing with anything like this that comes in is, it’s not the fact that you can see how it’s going to make all games better, but I think it’s hard for the individual developer to see how it makes them competitively, gives them a competitive advantage. If everyone has access to the same tools, then, maybe this, everything gets better, but how does that make your game stand out from all the other ones, particularly if it’s going to be loads more games? I guess that’s the really tricky thing that developers are going to have to come to terms with, which is what their competitive advantage is in that landscape.

I guess we’ll have to ask chatGPT to see if it can tell us. Cool, so there is plenty to look forward to. Thank you for the games as well. It’s always good to get some titles we can start checking out and look forward to. But thank you for your expertise, Wilhelm and Kalle.

[00:43:01] Kalle Heikkinen: Thank you.

[00:43:02] Wilhelm Voutilainen: Thank you.

[00:43:04] Jon Jordan: And I thank you for watching and listening to the podcast; however, you are consuming it. Of course, in every episode, we are delving into what’s going on in the mobile game space, which is the most dynamic and largest gaming sector. So we hope you are enjoying the shows. Obviously, subscribe to get all our episodes, and we’ll see you next time. Goodbye.

Introduction and celebration of the 50th episode

[00:00:00] Jon Jordan: Hello, and welcome to the Mobile Game Playbook. Thanks for tuning in for another episode. In fact, I’ve just been reminded this is our 50th episode. Well done to us.  If you haven’t listened to all 50, you need to have a look at your podcast history and see what we’ve been talking about for the last 49 episodes. Just a reminder, this is the podcast all about what makes a great mobile game, what is and isn’t working for mobile game designers, and all of the latest trends.

I’m your host, Jon Jordan, and joining me today, we have two experts to dig into a particularly interesting area. We have Kalle Heikkinen, who is the chief market analyst for China at GameRefinery. How’s it going, Kalle?

[00:00:40] Kalle Heikkinen: Very good. Thanks for asking. How about you, Jon?

[00:00:42] Jon: Not bad at all. 50 episodes, wow. That crept up on me there.

[00:00:47] Kalle: Wow. That’s amazing.

[00:00:48] Jon: Good. I think for the first time– It’s always exciting to have a new expert, so we have Inka Reinola. How are you doing, Inka?

[00:00:57] Inka Reinola: Inka, yes. I’m doing fine. How are you?

[00:00:59] Jon: Very good. You are another Chinese market expert at GameRefinery as well. Obviously, we are talking about China. It’s hard to know where to start with China, I think, with it being the largest mobile games market for quite a while just in terms of having a lot of people who play a lot of games, but increasingly also is the place now where games are made that are successfully globally, and not just in the Chinese or the Southeast Asian region. Kalle, you’re going to kick us off. Just give us a top overview to get our minds into shape around the Chinese mobile games market. Then we’re going to drill into some various topics as we go.

Overview of the Chinese mobile games market

[00:01:42] Kalle: Yes. I was thinking about what makes the Chinese market so special, and I really made it down to three major points, I think. I would say, first of all, it’s like you said, Jon, the market is huge. They have a big domestic market that has a big appetite for gaming. For example, last year, the market size was something like $45 billion. 500 million people in China play online games, which translates to 52% of the population. That’s quite interesting numbers, and that’s a huge market by any standards.

The second point is the access to capital in the market and access to a very talented and relatively inexpensive workforce. There is money to make investments domestically as well as overseas. That’s why we see these splashy investments: Tencent buys shares of Riot, Epic, Supercell, and stuff like that. As I mentioned, great access to relatively inexpensive labour then enables studios such as miHoYo to exist that have a headcount of something like 4,000 employees or something like that.

Then, as the third point, I would say the regulations in the way that they shield the domestic market from foreign games to enter the Chinese market. I know that we are going to discuss this topic later on. Let’s just put it that way: it has never been a very straightforward process for Western developers to enter the Chinese market and operate their games.

[00:03:31] Jon: As you said, we’ll discuss this; it’s not always been the easiest place for Chinese developers either.

China’s unique gaming history

[00:03:38] Kalle: That’s true as well. Also, I think it’s good to– People a lot of times ask why is mobile so much associated with Chinese gaming and stuff like that. I guess just giving a bit of context around that could be interesting as well. Concepts like games as a product, boxed products and stuff like that, and console gaming in general, never actually played a big role in China. There are various reasons for that. We don’t want to go there right now, but things like piracy and the fact that console gaming was banned for a long time in the country played a role.

The gaming population was always exposed to free-to-play and mobile gaming from the get-go. There wasn’t a big shift from box products or console gaming to free-to-play we saw in the West. Instead, what we saw is that for a lot of Chinese players, their first exposure to gaming was through mobile and PC, and the prevalent business model has always been free-to-play in China.

A lot of Chinese also live in relatively small and cramped apartments, and the families are big. There’s often multiple generations that live under a single roof, so it’s not easy to find a place where you can actually have your PC rig set up or TV console set up installed. Even if you did, gaming has never been commonly perceived as a healthy hobby. The underaged have always been forced to go outside or play secretly, and mobile devices allow you to do that if you understand what I mean.

[00:05:29] Jon: That’s a good point to know. I guess the point at which free-to-play mobile games were getting big was also the point at which you had this big change in the Chinese market as well. You have, obviously, a large population and a lot of very strong middle-class people developing there just at the same time when the world is really getting free-to-play mobile, and there’s just no history of gaming anywhere else.

You have that a little bit in Japan, but Japan would obviously be massively into consoles as well. In Japan, you have really strong consoles, not a lot of PCs, but a lot of mobiles, but in China, just all that growth and all those interesting games were just pushed into free-play mobile. That’s just why it very quickly became this enormous power.

[00:06:11] Kalle: Yes. That’s a good point. There are overlapping timelines there, for sure.

[00:06:18] Jon: Cool. That’s our headline. Now, Inka, you’re going to go into a bit more about what’s going on trend-wise at the moment, which is obviously– Give us some detail.

Current trends in the Chinese mobile games market

[00:06:28] Inka: Yes. It was a bit of an oral market at first, so Tencent and NetEase still dominate the market. Mid-core is still a big thing, but actually, interestingly, the casualness has been on the rise right now. It’s like last year: Mid-core lost 7% of the revenue market share, casual actually grew 4%, and casino 2%. There are a lot of different interesting things in the casual world that have been affecting this, and one of the most interesting is the game called Eggy Party. It’s this stumble guy type of game, which has very deep social experience. For example, you can walk into a shop and see other players at the same time there. Eggy Party was actually the third biggest in Q2, and it’s grown into this whole big thing within a year. That’s drawing a lot of casual players in. In addition to that game, there are also a lot of other casual games that are interesting. For example, there’s one merge game called Fat Goose Gym. Merge games are not very common in China, but that has been very popular. General-wise, there’s also a lot of interactive story games that have been published. Not quite recently, but there are new interactive story games every now and then, so it’s definitely growing. Also, there’s this cozy game thing. It’s also in China because there’s this one tycoon game, which is this very beautiful water-painted soothing game where you manage a village somewhere in the fantasy world. It’s very cozy and soothing and a nice gameplay experience. Also, feature-wise, there’s interesting stuff happening, like limits on gacha spook gacha discounts. They have all become more popular, and there’s a big difference between the top 20 games and other games. The overall idea is more casual, I think.

[00:09:01] Jon: You go ahead.

[00:09:03] Kalle: Go ahead.

[00:09:03] Jon: When you say cozy games, that’s more like a genre or a style of game that makes you feel comfortable.

[00:09:11] Inka: Yes. I think that’s also a Western thing. In general, people like to have these cozy games, and apparently, China also has this kind of thing happening that some people want to play these more chill games, not so stressful. Yes.

Social elements in Chinese games

[00:09:30] Kalle: I just wanted to add on the– Inka mentioned about the socialness of the game. If you look at basically all the top games in China, but also the casual games, we mentioned Eggy Party, which is obviously entirely based on social experiences. Inka mentioned the social hub that is there, and you can create your own home there, decorate it, invite friends to come over, decorate the home with them, and engage in all kinds of social activities in the game with your friends. Also, the Fat Goose Gym that you mentioned, the merge game–One of the things, there’s actually a lot of interesting aspects in that game because, in the West, the merge of two genres has been a little bit of– How should I put it? Stagnant in the sense that we haven’t seen large feature evolutions in the genre. I’m not saying Fat Goose Gym is doing anything super wild there, but what they have there is, for example, a chat function. They have friend lists and send-us features, which are something that we haven’t seen in the top-grossing Merge Two games. That just tells about the Chinese developers and their emphasis on the social aspects of games. No matter the genre, they are thinking about how we can add social elements into the game, which obviously, as we all know, is a huge weapon for you to utilize if you think about retention and how to make your players stick to your game and stuff like that. They are definitely masters of that.

[00:11:13] Inka: The Chinese people especially love the social aspect of the games, but of course, it’s like in Western games, it has also become more popular to have some kind of social elements. Maybe it has something to do with China having a lot, so we don’t know.

[00:11:33] Jon: I guess, again, very high level, not an expert view for me, but mobile apps in general are much more sophisticated in that respect in terms of China. People in the West say people are spending too long on their mobile phones or on Instagram or something like that. Obviously, in China, you have these– We’ll see what Elon Musk manages to do with X, but this idea of everything apps. You have these apps that are Facebook, Twitter, and shopping all merged into one.

I guess, in general, that audience just expects a more sophisticated experience from just it being a game that you have your game friends in there. People are just much more, I think, used to sharing that sort of stuff. At least, that’s my impression.

[00:12:25] Kalle: Yes, that’s a good point. There are a lot of gaming experiences in China that, like you said, they offer under one roof. As to say, they offer a lot of different experiences. Just to give you an example, you have Honor of Kings, which you all know is a MOBA game, but you can have four-guys mode there, you can have an auto chess mode there and stuff like that, or QQ Speed, which is a Mario Kart racer. You can have a dancing game mode there, you can have among us mode there and stuff like that.

They’re very quick to look at what’s trending not only in China but also in the West and then add those elements that they see trending to their own games. It doesn’t matter if the core genre or the core loop in the game has anything to do with that trend that they’re looking at. That’s always very interesting to see when those things happen.

[00:13:29] Inka: Yes. Also, the addition of something else in the core game is the thing. For example, in the Fat Goose Gym that you mentioned and I mentioned before, it’s a merge game, but there is this menu where you can access multiple different mini-games. You will never get bored because if you’re bored with the merge game, then you can play some other type of game mode at the same time.

I think the new games now have added even more of that stuff than before. There’s also this new MMORPG called Justice, and that one also has a really social wall where you can see where your game friends right now are doing whatever they are doing inside the game. I think they’re thinking about it even more than before.

[00:14:22] Jon: Maybe a silly question, but I have to ask it.  Obviously, you talk about games, which I guess the translation or the transliteration of something like Eggy Party or something like Fatgoose Gym obviously sounds funny in a maybe different way to us. In China, does something like Fat Goose Gym— Is that just like a translation of those words? In China, does that seem like in English, stumble guys?

[00:14:49] Inka: It depends on the game. Sometimes, they have their own translation name, but sometimes, we just need to put it into action by ourselves, and it might sound a bit silly.

[00:15:01] Jon: Yes, because I’m wondering, there may be phrases in Chinese that the game title plays off of, which would make sense to a Chinese audience, whereas for us, it just sounds like no one here would release a game called Fat Goose Gym, or I don’t think they would do that. [crosstalk] Maybe. I don’t know.

[00:15:17] Kalle: I know that Eggy Party, at least, is the official name that they use, but actually, with Fat Goose Gym, I’m not 100% sure if one of our analysts made it up or if we look it up from somewhere. That’s actually something that I’m not 100% sure about.[00:15:31] Inka: Yes, unless you’re a writer.

Changes in player demographics

[00:15:33] Jon: Yes. Interesting. From what you’re saying there, it’s interesting that mid-core, which is Chinese and Asian markets, has always been very focused on because that market size is better. I guess maybe if that’s going down a little bit, maybe the market will expand a little bit. Can we make that as a broad trend, or is that my making stuff up there?

[00:16:01] Kalle: You mean that the market expanded beyond mid-core to agile and other spaces?

[00:16:06] Jon: Are people playing less mid-core and moving on to these other things? I imagine over time, more people who wouldn’t call themselves gamers eventually end up playing games, so you have a widening of the audience but maybe becoming less concentrated in the more core element.

[00:16:25] Kalle: The way I see it is that I think we, as players, at times, might be motivated by different things. If we think about games, like I mentioned, that a QQ Speed has– Maybe a mid-core game is a better example. If Honor of Kings has a casual-ish game mode in there, I think a lot of people don’t mind playing that casual-ish game mode, even if it happens inside a mid-core game.

Especially these big games that have tens of millions of players, there are so many different player types and so many different motivations to play the games that a lot of them might have additional motivations and appetites for the game genres in addition to, let’s say, the mobile gameplay in Honor of Kings. I think that’s just adding more value to these players and giving something that they can– the specific motivations that they might have. I guess that’s how I think about that.

[00:17:55] Inka: In addition, I think that it might have something to do with the same thing as in the West, that the gender who play the games have also diversified. Maybe earlier, it might have been a more male-dominated thing, and then it’s more female players. Often, they play, for example, interactive story games, customization games, or something else casual. There’s a need for those genres to– Yes.

[00:18:29] Kalle: Yes, that’s a good point. I think it was researched some time ago that the demographics, for example, for Honor of Kings, was– The percentage of female players was really high. It was close to 50% or something like that, so that was really surprising. No wonder that they’re also looking to serve that kind of demographic.

Chinese games going global

[00:18:58] Jon: Honor of Kings is like a mobile MOBA; it’s effectively a League of Legends type game, isn’t it? That would be an interesting point of view if it were that the audience had a wider demographic because you have these games which are about one thing but have all these other things in there. That’s a more interesting audience. Whereas it is striking– In the West, I don’t know, probably culturally that if you had a shooter game and then put a merge in there, the family would be– Maybe this is me putting too much stress on the point, but it seems to me maybe that Western ordinances treat the coherence of the game as that’s quite important.

If you have a game, the game needs to make sense. You can do weird things in the game, but there needs to be some sort of reason why you’re doing weird things in the game. Whereas I think Asian markets, not just for China, it doesn’t matter if you’ve got a shooter game and you put a merge game in there. If everyone likes it, that’s fine because we’ll get on with it.

[00:20:00] Kalle: Yes. Then, on the other hand, in the West, we’re seeing a lot of hybrid games, and we have things like puzzle RBGs that combine mid-core elements with certain casual elements and other examples like this. Yes, I get your point. Maybe in the West, it wouldn’t be that easy in a way to pull that kind of thing off.

[00:20:18] Jon: I think for a live game, you probably find the core audience. The core audience generally gets very moany about things they don’t feel are part of the core experience. Anyway, let’s move on. I guess one of the other big trends over the last probably maybe five years, more than that, but previously, Chinese were already good at making games for China, Southeast Asia, maybe Japan, Korea, but we’ve really seen now, I guess, Chinese games be very successful globally.

The Chinese developers co-develop or have access to IPs like Harry Potter and Diablo and all these things. Really that’s been, I think, quite a big change to my mind that Chinese games aren’t as big globally as they are in China. Do you think that’s a fair assessment? Is that a big trend, or am I overseeing that?

[00:21:11] Kalle: Chinese games not being so big?

[00:21:14] Jon: No, they are so big now. Previously, Chinese games tended just to be big in Southeast Asia or China or those areas, whereas now I think Diablo clearly was– There’s lots of discussion around that game and how grind it was going to be, but I think most people just think Diablo Immortal is a really good game. That’s my impression of it, at least, the fact that it was made by a Chinese developer. Call of Duty Chinese developer. Almost like all the big IP games now.

[00:21:46] Kalle: Yes. I think there’s been a definite change that we see a lot more China-originated games in the West and globally as well. If you look at, for example, the forex strategy space in the West, it’s all China games. Really, it’s dominated by them. We see they have a big presence in genres like RPGs and shooters. Where I think the next big move is going to be is going to be casual. We are already seeing some signs of that in Merge Three; for example, makeovers have origins in China, and games like Gossip Harbor by Micro Fun and stuff that I think will get bigger.

Chinese regulations in the gaming market

[00:22:41] Jon: Cool. One thing we headlined at the start was Chinese regulation. I don’t know how much detail you want to go into on that one because that could be a podcast in and of itself, all the changes that have happened.  How do you want to inform us about the Chinese regulation of mobile games and the impact that has?

[00:23:00] Kalle: I think, as you said, this could be its own podcast, and definitely, I’m not the expert out there when it comes to this topic, but it’s always been an interesting one, and definitely as a China analyst, you get exposed to this stuff. I guess what I want to just go through is the different types of regulations that are there because that’s also sometimes a bit confusing.

People talk about regulations, but what do they actually mean? Obviously, there’s regulations on the market entries for Western developers in China. You need that special license to enter the market. Maybe some of the listeners might know that there were several years when no licenses were given to Western games, but now, in the last year or two, these regulations have been slowly being eased off. That’s one thing.

The second thing is that there are regulations on children’s playtime and money spent. How they are tackling this is with different kinds of locking credential requirements and stuff like that, but according to some of the reports and research that I’ve found, apparently, the restrictions can be bypassed quite easily. Actually, when minors’ playtime has been researched after these regulations have been implemented, there hasn’t really been any major decline in minors’ playtime. It might be that these regulations haven’t worked as well as they were initially planned to work.

The third one is regulations on the content of the game. China being China, there are things you need to consider when it comes to LGBTQ content; for example, you cannot criticize certain things about China in games and also about sexual topics and stuff like that. That’s also a bit different when it comes to operating in the West, obviously. Then monetization regulations.

One thing that comes to my mind straightaway is, for example, that starting from, I think, 2017, all the games have had to disclose their gacha drop rates, for example, in the game. There’s a lot of different types of regulations. When people talk about regulations, it’s always good to clarify what kind of regulations they actually mean.

The challenge of Western games in China

[00:25:49] Jon: In terms of the first one, are there any notable Western-developed games that are doing well in China these days that would be good to point out?

[00:25:59] Kalle: There are some, but there is a clear change that has happened. I’ve worked here for seven years, closely following the Chinese market. When I started, it was very common for Western developers to have the same game with the same game ID that they have in the West in China as well. Whenever there was an update to the game, you could always rely on it. It’s the same build, the same ID, the same update, and the same content. Of course, they still could have the texts in the game, copywriting, translating, and stuff like that, but it was the same build, the same game. That has completely changed. I think the change happened three or four years ago.

Nowadays, you have all the Western games that we see in China, let’s say, Supercell games or Playrix’s games and stuff like that. They operate with their own IDs. They usually have a partner company that they’re cooperating with. Maybe it’s NetEase, maybe it’s Tencent, maybe it’s something else. If you look at the publisher of the game, that’s usually the publisher of the game.

They might have been not only translated but really localized. Maybe the live ops monetization has been localized to a much greater extent than what the differences were seven years ago. There has been a clear shift when it comes to that. You asked what kind of games there are. There’s a couple of Supercell games, Inka, you can actually correct me if I’m wrong, but I think Clash of Clans is in the top 200. We have Brawl Stars there. Then we have Homescapes: Gardenscapes, Inka, does something else come to your mind?

[00:27:54] Inka: No, I think that’s pretty much it.

[00:27:56] Jon: Really?

[00:27:56] Kalle: Yes. One thing to know is that the number of these games has been decreasing all the time. Now it’s a very interesting time to look at how things will evolve now that new licenses are also given to Western developers. Will we see new Western-originated games getting into the top 200, or is it going to stay the same?

[00:28:22] Jon: Certainly remember when Supercell started launching there, it was seen as a very big thing. I guess that was the peak of when the Chinese market was more open, and I think it’s been downhill since then. Actually, that did remind me of one thing we have mentioned in passing a couple of times, and it may be good to go into a bit more detail.

We do mention Tencent and NetEase as the two big companies in China. Can you give some idea of just how big they are? It is not like we’d say, “Oh, Activision and EA are quite big in the West.”? There’s quite a lot of other ones as well. I don’t know the exact figures, but they are just enormously bigger than anything else, aren’t they? It’s all a duopoly.

[00:29:04] Kalle: Yes. It’s a very drastic difference, especially if you compare it to the Western market, which is much more fragmented. If you just look at the, let’s say, top 200 grossing games, you look at the publisher, if you had an Excel CSV output of the publishers of the top 200 games, you would see a lot more fragmented charts of the publishers. Then, in China, NetEase and Tencent have a huge, huge market share of the top 200 games. I don’t have any exact numbers to throw at you right now, what is the exact percentage number, but the difference is like night and day if you compare Western and Chinese markets.

[00:29:49] Inka: Also recall that Honor of Kings takes a really big market share of overall revenue, and it’s the top one game.

[00:29:57] Jon: Yes. I think at one point it was– Was it 100 million DAUs or something? I think maybe it’s dropped a little bit since then, but it’s the biggest game in the world on any platform by miles.

[00:30:09] Kalle: Yes. An interesting thing is it’s still, I think, in the top 10 downloads. Even if it’s, I don’t know, seven, eight years old games. Yes. People, I guess, turn out for a little bit and then they reinstall the game, and it’s always at the top. Yes, interesting.

Future of the Chinese mobile games market

[00:30:27] Jon: Good. We’ve had a look at where we are and a bit of the past. How do we see the future of the Chinese market? What products are going to be there? Any significant changes, or is it going to continue in the gradual upward trend that we’re seeing?

[00:30:47] Kalle: Yes. When it comes to Chinese publishers, I mentioned this already, but they most likely will try to gain even more foothold in the West because the Chinese domestic market is– Of course, all the markets are highly competitive, but the Chinese market is fiercely so. The Western markets are very, very attractive for Chinese companies. We mentioned the acquisitions that they’ve made and stuff like that. I see them as an active player in the West in the future as well. I already mentioned that I think the next big moves are going to happen in the casual space.
One interesting example of that is Micro Fun. I mentioned this already as well. They operate the game Gossip Harbor, but they have several other merge games as well. Some of them merge three games, and some of them Merge Two games, but they have a clear portfolio strategy where they cross-promote inside one app the other app so that you get rewards in the app that you’re playing if you download the other app and do certain tasks there. They’re definitely trying to move their players across their portfolio games and then increase the overall value of their portfolio that way, which apparently is not–Let’s put it this way. I’m not sure if it’s 100% something that you actually are allowed to do in a sense in the West, but yes, that’s something that Micro Fun is doing. I think that strategies like this will be something that the Chinese publishers will definitely consider. Then, just regarding M&A, I think that in the future, they will most likely be challenged by Saudi money. We’re already seeing some big moves from, for example, Savvy bought Scopely and stuff like that.
In the future, with the M&A things going on, I think they’re going to get more expensive for Chinese companies to engage in just because of the fact that the competition of the investments is also getting higher. Of course, on a macro level, now the overall M&A market has cooled down a little bit, but in the longer term, I do think that it’s not going to be so easy for them for various kinds of reasons to engage in that strategy as well.

[00:33:37] Jon: Yes.

[00:33:38] Inka: I would also add that I think that because there’s a lot of these Chinese games that have been published in the Western market, they’re exactly the same, and sometimes it doesn’t work because it’s maybe a bit more Chinese in taste. I guess that they will get better at localizing them to the Western market in the future because younger people may understand better how to do that localization. I believe that they will get better at that.

[00:34:10] Jon: It’s almost the reverse of what you’re saying, Kalle, where, to begin with, Western developers were putting just their normal game into the Chinese markets and then hoping it did well. Maybe for the last few years, Chinese developers have been putting their Chinese game into Western markets and hoping it does well, but actually, they’ll realize, “The game we have for China it’s a good game, but we need to just–” Maybe some subtle differences or maybe some more substantial differences over time is a way to optimize that for different markets. Certainly, the taste of Western gamers is still quite different from Chinese and Asian gamers. Maybe it’ll be the reverse trend that they’ll be learning from that way. Cool. Good. Thank you very much to Kalle and Inka. I hope you enjoyed that. Every episode, now we’ll be episode 51 next, wow, we’ll be talking about what’s going on in the mobile gaming world. There’s just an awful lot going on, very dynamic. Very big markets and these big companies coming in, and it’s always changing. I hope you subscribe via your podcast channel of choice or by the video. Now, I am doing a video. Thanks for watching and listening, and come back next time. See you then. Goodbye.