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What made you passionate about video games?
It goes all the way back to childhood. Like many in the late 80s – early 90s, I was excited about computers and programming, so I learned Basic when I was 8 years old and started programming games. My dad was a computer enthusiast in Moscow, and I had plenty of time with ZX Spectrum, Russian exotic computers like Orion-128K and ES-1841, and then PCs. I spent an unhealthy amount of time playing games that are classic now. Eagle’s Nest, Elite, Dangerous Dave, Commander Keen as well as early Sim City, Transport Tycoon, and X-Com UFO games were the most damaging for my school studies. I was programming in machine code and assembly language by 6th grade and wrote a few games in Pascal and assembler by the time I finished the school, and by then I knew I wanted to spend the rest of my life making games and nothing else. So I was making games or helping others make games ever since.
How did you enter the video game industry?
I studied computer graphics in Moscow State University and got my first job as 3D graphics programmer at one of the first Russian game development studios. I met other G5 co-founders at that company and eventually we quit to found G5. We focused on mobile and casual games from the beginning. We got to make some mobile games for EA, Disney, and Sony before investing in G5’s original games. In 2006, we listed G5 in Stockholm, Sweden, and G5 became the first and remains the only publisher originating from Russia that is publicly listed on an exchange. IPO allowed us to focus on our own games and I came up with the ideas for Supermarket Mania and Virtual City, and both games eventually made us millions of dollars on iOS and Android. We quickly understood the potential of casual games on smartphones and tablets and started scaling this business and publishing games from other developers. Now we are happy to work with some of the best studios like Artogon, Floodlight, Vogat, Orchid Games, Fenomen, Artifex Mundi, Hipsoft, Frogwares, Awem, and many others: in total, more than 60 developers. Our developer relations and publishing team can be reached at developers@g5e.com.
Can you tell us more about G5 Entertainment? What skills have been helpful in your current position?
G5 Entertainment is a publisher of casual and free-to-play games on smartphones and tablets: iOS and Android. We focus on smartphones and tablets, and we are very good at it. Casual games that we have published make several times more money from mobile platforms than they ever did on PC portals. We also have more than a hundred people in our internal development studio in Ukraine, and we develop and publish our own games. Our first free-to-play game Virtual City Playground became worldwide success, and we are bringing more free-to-play and social games to the market soon. Overall, we have published over 200 game apps for iOS and Android and we release at least one new game a week. Being a developer ourselves, we understand what’s most important for the developers we work with. What they want is great revenue share terms, transparency, and maximization of sales of their games across all mobile platforms and over time. And this is what we offer. We bring their games to global market, help with localizations, platform adaptation advice and technology, if needed.
We make sure that every single game we release is cross-promoted and well-exposed to the users during its whole lifecycle. And the lifecycle of G5 games is really long: our first iOS games, launched in 2009, still make tens of thousands dollars every month, more than 3.5 years after initial release.
This is why releasing your mobile games with the right publisher like G5 is very important: your game will not be lost among hundreds of thousands of apps and will immediately reach large audience of our loyal users.
For years, your game will generate steady revenue stream and will be cross-promoted and easily discoverable by users because it is in G5’s portfolio. We will also take care of updating your game and bringing it to new app stores and platforms. Unlike the oversaturated PC market, the market of smartphones and tablets is growing. You will not see your sales go to zero like you have come to expect from PC portals in recent years.
Some publishers only focus on casual games for iPad, but it’s wrong to ignore the rest of the market, which includes iPhone and, of course, Android devices. In the long term, analysts expect iOS to hold only about 20 percent of the market, so bringing your games to Android is very important. And G5 achieved outstanding success in monetizing casual games on Android! We started in July 2011, and we are making millions with only 20 Android games released so far (with many more coming out before the end of the year). In terms of the number of downloads, we are some 50 times ahead of our nearest competitor in casual games on Android stores. We are basically the best partner to bring casual games to Android.
What difficulties did G5 Entertainment face when creating Virtual City Playground?
Virtual City Playground (VCP) is our first free-to-play game which has been downloaded millions of times and made us millions of dollars in only a few months after the release. We have created VCP based on our casual downloadable game Virtual City. This was a casual city simulation game, which made no money on PC portals, because there’s not much money left on PC portals really; they are dying their slow, painful death. However, the original Virtual City made us over $1M on iPhone and iPad in a matter of months! Virtual City Playground was quite the same game: same content, same game mechanics. However, we changed the monetization model from “try before you buy” to “free-to-play with virtual goods”. And suddenly this “new old” game started making millions of dollars, and much faster than the original casual game. Developing a free-to-play game from a casual game was not straightforward, but we came up with a 5-stage process, which helps convert pretty much any casual game into a free-to-play game. This is really a great opportunity for casual game developers out there, to take their best franchise and convert it to free-to-play format, if they can do it right. I explained our approach in my speech in Singapore this year and I will also speak about it in Seattle in July. We are looking for developers willing to take their casual game bestsellers the same route and convert to free-to-play. We have 50 million users and we can help you bring your game to the market in front of this audience. We also help with financing and legal advice, and provide great revenue share terms.
What opportunities have you seen in the mobile market for developers?
Whatever a game can make on PC portals in revenue, with G5 it can make several times more on mobile platforms. In a couple of years, virtually everyone is going to have a touch-based smartphone in their pocket or a tablet in their hands capable of running casual games.
The smartphone and tablet market is truly a mass market, reaching all kinds of people around the world, not limited to the familiar PC portal demographics of 50+ US-based females who want to play spooky mansion games over and over again. So if you want creative freedom and you want to make a lot of money from your games, you should be going to mobile and talking to us.
Here is a great example: our game Special Enquiry Detail, developed by Floodlight Games, which was only moderately successful on PC portals, became a true hit game with mobile audience, first on iOS, then on Android, making it to the Top 10 Grossing charts on iPhone, iPad and Android phones. This is one of many examples, which proves the point that developers should not consider PC as the main source of revenue anymore. The wise strategy is to start developing games for mobile first, and then port them to PC for incremental revenue. Make the first step towards mobile markets: port and publish your PC casual game with G5. See for yourself that making hundreds of thousands and even millions of dollars from a great casual game converted to mobile is a reality. G5 has multiple casual games that sold well over $1M on mobile platforms. Then make a second step and develop for mobile from the beginning, or better yet convert your best casual game franchise to free-to-play format to ensure your competitive position in the future that is mobile.
We see that some developers don’t quite get this new reality and lose their chance to get independence and the recognition they deserve. They stick to their old ways because of inertia. They need to understand that casual games space is no longer a place where PC portals rule. Today, if you do things right, you can go to mobile platforms, and make a lot of money there, and then dictate PC portals to your conditions.
In a year, PC portals are going to be starving for content, while sales per game on PC will continue to deteriorate.
This is going to be a painfully slow death for PC-centric companies who used to be the leaders of the market. On mobile, they don’t have any advantages compared to publishers like G5. In fact, G5 generates higher revenue per game, maximizes revenue from the game across many mobile platforms and stores, and provides better revenue share terms.
Why do you think the social factor has become so important?
I would say that it’s the free-to-play (F2P) model that became important. Our Virtual City Playground game does not have many social elements (yet), but still makes a lot of money. Using a F2P model removes the ceiling on how much a player can spend within a game. If your casual game is $6.99, that’s as much as one can spend on it. If a F2P game is engaging and balanced in the right way, some people may spend $0.99, some $4.99, but some would spend $20, $50, or several hundreds of dollars. Adding social elements is great to improve engagement, which makes people spend more time and money in the game. For developers, I would recommend converting their casual games to a F2P monetization model first, and then add social elements. We are ready to share our recipe and knowledge with developers.
What new technology do you think has been most beneficial to the industry? Why?
Obviously touch screens and wireless Internet – these are two technologies that reinvented casual gaming. Players can download their casual games anywhere using wireless Internet, and they can enjoy the simplicity of using the touch screen to control the game. Smartphones and tablets will make casual games available to virtually everyone in the world. iOS and Android are the two most important platforms to be on today.
What predictions do you have for the mobile market?
It’s best to rely on analysts when it comes to predicting the market. Analysis say that by 2020 there will be 10 billion connected mobile devices. My guess is most of them will have touch screens. This makes it the biggest videogame platform ever, and it’s going to be perfect for casual games.
The market is predicted to be worth $25 billion by 2015 already.
If you are a developer of casual games and you are not going mobile – you are losing the opportunity of your lifetime. If you are going to mobile platforms, make sure you pay attention to Android. Analysts say that iOS is only going to hold some 20 percent of the smartphone market; there will be a lot of space for Android and possibly other mobile platforms as well.
What new projects can we look forward to from G5 Entertainment?
We are releasing a new game a week. We already have over 50 games in the pipeline for 2012, and we are focusing on two areas: casual games and free-to-play games. Games in our portfolio and games we are working on include some of the best quality hidden object adventure games, strategy and puzzle games, and such bestselling franchises as Build-a-lot series. The company has been growing by leaps and bounds in the past three years and we are not slowing down. If you are a developer and you want to take your next game to mobile, talk to our licensing team at developers@g5e.com or stop by our Platinum Sponsor table at Casual Connect in Seattle.
