MMO Money: Tencent’s $20 Billion Loss and Fortnite’s Decline

After having taken a little bit of time off for the end of convention season the weekly online gaming business article is back with more amazing news. We have Superdata’s latest gaming revenue charts, the UK’s weekly gaming chart, a little bit of lockbox news, and a company that lost $20 billion in value and is still going strong.

 

Superdata July Charts

Fortnite's Decline

Superdata released their monthly look at the gaming charts around the world with some interesting findings for July. First up, League of Legends drops down to second in terms of earnings on PC. It was overtaken by Dungeon Fighter Online which is massively popular in the east. In fact, only 2 of the top 5 PC games at the moment are from the West; LoL, and Fortnite. Speaking of Fortnite, the game’s earnings were only up 2% in July over June which is prompting many to say that the game’s peak is now behind us and Fortnite’s decline is imminent. However, it is still growing…for now. And, if they can get past all the security issues, Fortnite does still have the Android release coming which will be massive for the game’s population and revenue.

Overwatch, despite having a very stable player base is seeing revenue continue to drop month after month. In fact, the game is no longer charting at all but looking back as far as December, this isn’t the first time that has happened this year. It was also the case in February and April. In December 2017 and January it was number 10 on the PC chart. It hasn’t appeared on the chart for PC again since then. Looking at the charts for all of 2017 Overwatch ranked number 2 on the revenue charts for all Premium PC games. So, while it may not be on the charts right now, there is every chance for it to come back as it has done previously. On the other end of the spectrum, No Man’s Sky had its best month since it launched, and GTA V had its second best.

Fortnite still hasn’t managed to make it into the charts for Mobile games and in fact, the mobile chart changed very little from June to July. The one change was Fate/Grand Order overtaking Monster Strike. Until Fortnite has a global release on Android we’re unlikely to see it push into the mobile charts. Even then, the early security issues may have done enough lasting damage to make sure they don’t chart.

Source: Superdata

 

Tencent Market Value Drops by $20 Billion…but its ok

Tencent mobile financials - MMOGames.com - Your source for MMOs & MMORPGs

If any other company besides Tencent had lost $20 billion in market value the company would be done for. For Tencent though, that was just 5%. While they did lose a massive amount of money, the real story is why. China has been cracking down on games from other countries for quite some time. Tencent has been able to profit off of this. They know the laws better than any Western studio so they can offer to publish the game in China and deal with all the red tape themselves, but recently China has been making it even harder for game studios.

What triggered this massive loss for Tecent was China’s new regulation that will restrict the number of new online games that are released as well as implementing age-appropriate restrictions on games, including how long you can play them. The reason they give for doing this is the massive number of nearsightedness found in Chinese youth. Though there hasn’t been any scientific backing of the claim that screen time has any impact on vision. All of this puts Tencent’s current business model in jeopardy and they will have to make some changes if they want to continue. If you’re interested in reading more on this check out our recent news post that goes into more detail.

 

UK Charts Gaming Charts

Minecraft MMO Money: Tencent's $20 Billion Loss and Fortnite's Decline

The UK is one of the few countries that release gaming charts on a weekly basis. We’ve decided to add them to our weekly business article as they give us some idea of how games are performing, not just in the UK but among all western audiences. At the top of the charts this week was F1 2018, managing to hold out against a new game on the chart, PES 2019. In third is Grand Theft Auto V which actually climbed one place from last week. PUBG managed to climb up from 11th to 7th this week. Amazingly, Minecraft is still in the top 20, last week it was at 14 and this week it dropped to 20. Check out the top 10 for the week ending on September 1st below.

This Week Game Last Week
1 F1 2018 1
2 Pro Evolution Soccer 2019 New Entry
3 Grand Theft Auto V 4
4 Crash Bandicoot N.Sane Trilogy 3
5 Yakuza Kiwami 2 New Entry
6 Mario Kart 8 Deluxe 5
7 PlayerUnknown’s Battlegrounds 11
8 God of War 6
9 Monster Hunter Generations Ultimate New Entry
10 Fifa 18 10

Source: Press Release

 

Lootboxes

Overwatch Winter Wonderland - Christmas Loot Boxes

There hasn’t been a whole lot to talk about on the lootbox front. It seems like the world is slowly moving on and forgetting the topic altogether. Or maybe there’s a whole lot going on in the background that is going to take time to come into being. Either way, the big news recently is that Blizzard is disabling Overwatch and Heroes of the Storm lockboxes for Belgian players. Earlier this year Belgium was one of the first countries to investigate lootboxes in online games and issued threats to ban multiple games. Valve very quickly took action for CSGO and Dota 2.

Blizzard announced that they would be doing this on the official forums. In it they said…

“In April 2018, the Belgian Gaming Commission published a report that was endorsed by the Belgian Ministry of Justice in which they concluded that paid loot boxes in Overwatch are considered gambling under local law. While we at Blizzard were surprised by this conclusion and do not share the same opinion, we have decided to comply with their interpretation of Belgian law. As a result, we have no choice but to implement measures that will prevent Overwatch and Heroes of the Storm players located in Belgium from purchasing in-game loot boxes and loot chests with real money and gems.

No matter what, we want to make sure that our players around the world have the best entertainment experience possible. While players in Belgium will no longer be able to purchase paid loot boxes in Overwatch and loot chests in Heroes of the Storm, they’ll still be able to earn them by playing the games, and they’ll still have access to all in-game content.

These measures will be implemented shortly. We also remain open to further discussions with the Belgian Gaming Commission and Ministry of Justice on this topic.”

Source: Overwatch Forums

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MMO Money: Breaking Records and Taking Names

Grand Theft Auto V makes the news, there have been fines for shady lootbox practices, and the digital games industry is still climbing. You’ll be able to find all of this plus more Fortnite news than you can shake a stick at in today’s MMO Money, the biweekly column that takes a look at online gaming industry business news from around the world.

 

GTA V is the Most Profitable

With $6 billion in revenue since it launched in 2013, GTA V is the most profitable piece of entertainment of all time. That’s more than Avatar brought in at the theater and more than Michael Jackson made with Thriller. It owes at least some of its longevity to the online multiplayer gameplay. The fact that it has been released on two generations of consoles is also a big boost for the game, as many players would have bought it twice. Want to know more? Check out what we said about it in a recent news post.

 

Superdata’s February Research

Just a day after the last MMO Money went live Superdata released their regular look at the month before for the games industry. You’ll never guess which games were the most talked about. Oh, did you guess Fortnite and PUBG? I guess it was kind of obvious, as that’s all anyone is talking about these days! Fortnite was the 6th highest grossing game in February on PC and the 3rd highest on console. It’s also still climbing, so don’t think we’re at the peak yet. Tencent’s mobile game QQ Speed has become one of the fastest climbing mobile titles, it launched in December and is already in the number two spot.

Digital spending in the US is up 21%. Most of that growth is from console spending. And yes, Fortnite is to thank for some of that as well. Also, social games and pay to play games are still shrinking year on year. The good news though is that the digital game market has grown 6% in the last year to $9.1 billion.

 

Bluehole Announces Record Year

It won’t come as much of a surprise to anyone to learn that Bluehole, the folks behind TERA and a little unknown game called PlayerUnknown’s Battlegrounds had a record-breaking year in 2017. Their revenue for the year was approximately $631 million with $240 million in profit. Much of the company’s success is thanks to PUBG, which sold over 30 million copies in their first year since launch.

 

Fortnite Mobile Revenue Exceeds $15 Million in Less Than a Month

Since dropping the invite-only requirement, Fortnite Mobile has seen a massive spike in popularity. Daily revenue is at $1.8 million, making me think that I’m in the wrong business. It’s in the iOS top ten in 23 countries. All of this is only going to get bigger when Fortnite Mobile eventually releases on Android.

 

Netmarble Invests in K-Pop Label

online gaming industry business news

Netmarble is now the second largest shareholder in Big Hit, the label behind one of the biggest K-Pop acts at the moment, BTS. They announced back in February that they were working on a game based on the band called BTS World. They’ve invested around $190 million USD. They’ve also announced that as part of their big push into the West they’re moving their US office to Los Angeles. Their US office is currently in Buena Park, which is near Anaheim. So, for anyone who doesn’t live in Southern California the change is pretty insignificant in terms of distance. For anyone wondering, it’s 22 miles which is anywhere from 20 minutes to an hour away when driving.

 

Pokemon Go Fest Lawsuit Settled for $1.6 Million

pokemon go fest

Niantic is going to reimburse travel costs for those who traveled to Pokemon Go Fest last year in Chicago. This includes airfare, hotel costs, and car rentals, amongst other things. To qualify for a reimbursement you need to have checked in on the app at the festival and if you’re claiming more than $107 in expenses you must provide receipts. Niantic was quick to apologize after the disastrous event and at the time promised to refund tickets as well as give $100 worth of in-game currency and a legendary Pokemon. But the event was much more popular than they expected so tickets, which were originally selling for $20 were getting scalped for as much as $500. Fans traveled from all over the world to attend the event, something which will easily be more than $107. So, the lesson here is to always save those receipts.

 

Kakao Gets $9.42 million Investment

online gaming industry business news

Chinese developer Shanda Games has invested $9.42 million in Kakao Games. This was done through their Korean subsidiary Actoz Soft who Kakao is currently working with to launch Dragon Nest. This is just the latest in a series of investments made by companies in Kakao ahead of a planned IPO. Other investments recently have been from companies like Netmarble and Tencent. It isn’t clear yet when this IPO is going to happen, at the moment it’s thought to be happening sometime in 2018.

 

Lootbox Fines Handed out in South Korea

Sudden Attack

South Korea is the hero we all wish we had in our gaming lives. They’re handing out fines for dishonest lootbox practices, showing the world how things should be. They’ve handed out fines to Nexon, Netmarble, and Next Floor so far. In all, the three companies were fined nearly a million dollars combined, with the biggest fine going to Nexon for $875,000. What games did Nexon get hit for? You may be wondering, they were Sudden Attack and Counter-Strike Online 2. Specifically, the companies were fined for deceiving players and not providing accurate odds for winning any particular prize in a lootbox. Who is Next Floor? I had to look up the answer to this question myself. It would seem that they make mobile and social games in South Korea, including Dragon Flight, Destiny Child, World of Tactics, and Knights of Clan, as well as a few others. Right now we have our fingers crossed that these fines catch on around the world.

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GTA V Most Profitable Entertainment of All Time

GTA V is amazingly profitable for Rockstar Entertainment. It initially released on Playstation 3 and Xbox 360 in September of 2013 and since then it has brought in $6 billion in revenue. For anyone keeping track at home that’s more money than Avatar, the highest grossing movie of all time which only brought in $2.8 billion. 90 million copies have been sold worldwide which leaves music’s top album, Michael Jackson’s 1982 Thriller in the dust having sold 66 million units.

To get an idea of how well GTA V is doing it was the 6th biggest selling game in the US in 2017 and third biggest in the UK and Europe. On top of that it is still making the charts in 2018, currently sitting at number 8 on the UK gaming charts.

Some of GTA V’s success can be contributed to the fact that since it’s release we’ve had a new generation of consoles come out. Many people who owned it on Playstation 3 and Xbox 360 would have bought it a second time for Playstation 4 or Xbox One. Another major contributing factor is the online multiplayer gameplay which has allowed the game to continue having life years after it released.

So, are there any records left for GTA V to break? Actually, yes there are. Don Quixote by Miguel de Cervantes is estimated to have sold 500 million copies. That’s a whole lot of books. In fact, it has been estimated to be around the same amount as the entire Harry Potter series has sold. Of course, tracking how much money Don Quixote has made is impossible. The book came out in 1605 after all.

It also hasn’t broken Superbowl records yet, the 2015 Superbowl was watched by 111 million people in the United States. This is a number that GTA V is quickly approaching and could easily break.

What all of this means is that GTA V isn’t going to be going anywhere for a very long time.

 

Source: GIBiz, Wiki, Wiki, Chart Track, BoxOfficeMojo

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