MMO Business Report: Q3 Industry Reports

This week we have a few industry reports to take a look at for the end of Q3 2019 as well as Superdata’s monthly revenue charts. Plus Jagex has to come out and explain that it hasn’t been sold…yet again. There are only 9 weeks left in this year so before you know it we’ll be looking at the whole year in a glance. For now though, it’s Q3 and a few random pieces of industry news in this week’s MMOGames Business Report.

 

Jagex Hasn’t Been Sold

Jagex has had to clarify that they have not been sold after a Reddit thread with some regulatory statements that seemed to announce Fukong Interactive had sold Jagex to Platinum Fortune, which was believed to be “basically a shell company” of Fukong. GamesIndustry.biz reached out to Jagex to get clarification.

“As referenced in June, Fukong’s regulatory statements acknowledged that the company was looking to restructure its finances, and that resulted in announcements regarding the potential sale of Jagex,” said director of communications Rich Eddy.

“While the situation continues to progress, Fukong’s most recent statements advise the Chinese market that it has updated its financial information as negotiations continue. This is not a confirmation of a sale, which remains one of various possible outcomes.”

This isn’t the first time this year that this very same situation has come up. It also happened in July and was basically the exact same scenario as this time. If there is anything to take away from this it is that Jagex still might be sold in the future, but that potential has been on the table publicly since January and there hasn’t been any movement yet. So who knows when or even if it will actually happen.

 

Source: GamesIndustry.biz

 

Top Games of September 2019

Superdata has released their monthly game revenue charts for September and it’s bad news for some of the industry’s superstars. World of Warcraft saw a leap from 7th to 3rd in August thanks to the launch of WoW Classic, but in September it was back down to 6th. This isn’t because of the boycott, that won’t have an impact on the charts for another month or two. This was that initial surge of people who tried out WoW Classic going back to the other games they were playing. Fortnite has also dropped, Superdata estimates that the game saw a 43% decline month over month in September making it the worst month for revenue since November 2017. On console Fortnite dropped from first place to seventh in just one month. But, this all happened before Chapter 2 started so it’s really impossible to predict what future reports will look like for the game.

In August Pokemon Go had overtaken Honour of Kings for the number one position on mobile but in September Fate/Grand Order held the top spot, pushing Pokemon Go to number 2. Honour of Kings continued its drop down the charts and finished September in 4th place.

 

Source: Superdata Report

 

Worldwide Q3 Mobile Game Revenue

Global app revenue grew 23% year over year last quarter to $21.9 billion, but that isn’t the part of the new report from SensorTower that we’re interested in. We want to look just at mobile games which grew 20% year on year. Games accounted for 74% of all in-app spending, which is actually down two percent from Q3 2018. App Store users spent the most, having spent $9.8 billion in Q3 2019. That’s up 19% from the previous year. Google Play users spent $6.5 billion in E3 2019.

PUBG Mobile was the top grossing mobile game in the world for the quarter, grossing $496 million just in Q3 2019, a year on year growth of 652%. Pokemon Go was given the distinction of the fastest growing game by revenue quarter on quarter. It was up 63% to $308 million. Summer time is always good for Pokemon Go as kids are out of school giving them more time to run around and catch em all.

 

Source: SensorTower Report

 

Tencent Supercell Takeover

Top MMO News: March 9, 2016

Tencent has been on a roll recently with their investments, most recently having invested in Funcom. Well, now we can add Supercell to their list too. To understand the details of the deal though we have to have a bit of a history lesson.

In 2016 a Luxembourg consortium formed with the sole purpose of acquiring Supercell. They bought 81.4% of the mobile game developer which at the time was valued at $10.2 billion. Tencent had a 50% stake in the consortium which has now been increased to 51.2%. According to details from a filing on the Hong Kong Stock Exchange Tencent acquired $40 million worth of shares as part of a convertible bond. At this rate Tencent will have taken over the entire games industry by 2022, or at least it feels like it.

 

Source: GamesIndustry.biz

 

Q3 VR Report

Believe it or not the VR industry is still expanding. It certainly didn’t blow people away like they thought it would a few years ago but they are on track to bring in over one billion dollars in software revenue for the first time this year. Interestingly though it is location-based entertainment like those found in malls that are bringing in half of that revenue. Businesses have also caught on to the potential of VR. Enterprise headset revenue is on track to jump up 69% year on year. Superdata expects consumer spending on VR to more than double in the next 4 years to $2.4 billion.

The report from Superdata mostly looked at VR but it did also talk very briefly about AR, Augmented Reality games. There wasn’t really much data there, though they are expecting the genre to see growth from $1.8 billion in revenue in 2018 to $2.9 billion in 2022. They also pointed out that from June to August Harry Potter: Wizards Unite only earned 1% of the revenue that Pokemon Go brought in during that same period. As the report says, Harry Potter: Wizards Unite isn’t casting a spell on wallets.

Source: Superdata XR Q3 2019 Report

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Runescape Double XP Weekend Announced

Do you remember when double XP weekends were happening all the time? These days they are few and far between so it is well worth mentioning when one is coming up…and well… a Runescape Double XP weekend is on its way.

The event will run from July 26th to July 29th, for a full 72 hours. During that time Runescape members will be able to enjoy a 100% boost to experience earned while free players will have a 20% boost. There are a few exclusions to what you can earn double XP from, actually it’s a pretty lengthy list. Here’s the full list from the website:

 

The Double XP Weekend boost is not applied to the XP earned through the following items or activities:

Assist system
XP lamps
Tomes of experience
Ectofuntus
Cremation
Dragon rider amulet
Auto-sanctifiers
Goldsmithing gloves
Brawling gloves
Player-owned house altars
Wilderness Chaos altar
Dungeoneering wildcards
Sacred clay
Urns
Ancient effigies

 

It also does not apply to XP rewards given on hand-in for the following activities:

Quests
Daily Challenges
Jade Vine
Strange and golden rocks
Other Distractions & Diversions
Harvesting animal produce from Player-Owned Farms

runescape menaphos

It does not apply to XP awarded on hand-in of points or tokens. Examples:

Slayer point rewards
Brimhaven Agility Arena tickets
Dungeoneering tokens

 

The Invention skill benefits differently to others:

Item XP is gained at +50%
Making items on a workbench (charge packs, siphons etc) gives +50% improved XP
Disassembling random items (logs, potions etc) will give +50% improved XP
Disassembling/siphoning equipment does not give improved XP
Ironman accounts do not receive an XP boost on Double XP Weekend.

Finally, while stored Bonus XP itself is not boosted, it is still awarded alongside the boost from Double XP Weekend. So a member training a skill with stored Bonus XP on Double XP Weekend will receive +200% base XP.

 

From the sounds of it there are also going to be a number of events and competitions taking place. The details for those are going to be located on the various Runescape social media accounts, the Runescape Discord, and the Runescape Subreddit.

 

Source: Official Site

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MMO Money: Analyst Predicts First Video Game Decline in 24 Years

It looks as though Runescape creator Jagex may be for sale in the near future. Facebook released documents that are VERY anti-consumer. We also got a look at the December 2018 revenue chart for games, but the biggest news this week was an analyst who predicts the game industry will actually decline in 2019, the first time since the 90s. Find all of this below in this week’s MMO Money.

 

Jagex Possibly For Sale

Just a few years after acquiring Jagex, Fukong Interactive may be getting ready to put it up for sale. This comes at a time when Jagex is posting its best financial results ever, so the problem isn’t Jagex. In fact, it is Fukong Interactive that is the focus as they’ll be undergoing some restructuring. In a statement issued to GamesIndustry.biz Jagex Director of Communications, Rich Eddy, had the following to say.

“Fukong Interactive has issued a regulatory statement to advise the Chinese financial market that it is planning a major reorganisation and is considering sale of assets, with the partial or full sale of Jagex as a potential option. A sale of assets is one of multiple routes Fukong Interactive has available as it restructures and, by making this initial statement to the market, Fukong can now begin exploring such options.

“Whatever the outcome of Fukong’s restructure, Jagex continues to execute on our short-term and long-term strategies for the RuneScape franchise, which has seen five years of consistent growth, delivered lifetime revenues of $1 billion, and now has player membership at an all-time high driven by our living games approach and a successful first move to mobile with Old School RuneScape.

“Jagex has never been in better shape and the year ahead will see further investment in the organisation as we expand our talent base to create and deliver significant new content for our players, build on our Jagex Partners third-party publishing initiative, in addition to increasing our presence in mobile sector with RuneScape itself.”

Source: GamesIndustry

 

December Charts

SuperData is back with the final monthly game chart report for 2018, and it looks like December was a good month for Blizzard as they once again entered the charts. However, worldwide digital spending dropped 2% to $9 billion. In the mobile chart Pokemon Go continues to hold strong, now second only to the massive Eastern hit Honour of Kings. World of Tanks makes it on the charts for PC. Grand Theft Auto V continues its slow decline on console in the number six position on the chart. While PUBG and Fortnite had massive successes that can’t be ignored CS:GO is worth talking about. It’s now in its second month as a free-to-play game and has hit a new high for monthly active users. SuperData also estimates that the game, as a free to play title, made $49 million between November and December.

Source: SuperData Report

 

Analyst Predicts First Video Game Decline in 24 Years

Notable analyst Pelham Smithers has predicted that the video games industry will see its revenue decline in 2019. While speaking to Bloomberg he stated that his firm has predicted the games industry would decline 1% this year. That may not seem like a lot, but it is certainly noteworthy because it is the first time there has been any decline in the industry since 1995.

While a number of factors will contribute to this decline, Smithers specifically mentioned the ongoing effects of the 9-month freeze on new game approvals in China, which only recently ended. While approvals have started again the pace is slow which will continue the financial woes for the industry.

The mobile games industry is also being impacted by its inability to expand quickly and easily into China. This comes at a time when the industry has plateaued in Japan and the United States. Stagnation in one area means that declines hit even harder.

Declines like those being seen in Fortnite and PUBG. Both games saw the number of active users decline year-over-year as players grow tired of the format. Smithers predicts that this will trigger a slump in PC game revenue in 2019.

Talking about consoles, Smithers predicts that they will be unable to improve on the record-breaking year they had in 2018. Part due to it not being clear what games will be released this year but also that we’re near the end of the current console generation. Smithers observed that if the Playstation 5 doesn’t launch until the end of 2020 the console sector will continue to feel the effects until 2021.

Finally, Smithers warns that this decline could stretch into 2020. However, Bloomberg points out that rival analysts at Goldman Sachs, Nomura Holdings and Morgan Stanley disagree with Smithers and maintain that the video games industry will continue to grow.

Source: Bloomberg

 

Facebook Friendly Fraud Tactics

Farmville Screenshot Epic

Thanks to a recent class-action lawsuit, internal Facebook documents have come out that show Facebook encouraged what they called “friendly fraud” at the height of Facebook gaming’s popularity. Friendly fraud was what they called it when a child would overspend on games using their parent’s bank details. During this time they often refused refund requests and even ignored their own ideas on how to curb the behavior. Their internal documents even show that most often kids didn’t even know they were being charged real money. Facebook did change their stance…in 2016 when the era of Facebook games was all but dead.

Source: MMOGames

 

Keep an eye out later in the week for a special edition of MMO Money that looks back at 2018 with reports from across the games industry.

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MMOMoney: THQ Nordic Acquired Project Copernicus, Jagex Breaks Records

This week we’ve had some interesting and surprising acquisitions in the gaming world that are shaking things up. THQ Nordic acquired Project Copernicus, Pearl Abyss grabbed CCP, and Superdata was bought be Nielsen. Find out the details of all of those stories and more in this week’s MMO Money.

 

Jagex Has Another Record-Breaking Year

Runescape, a 17-year-old MMORPG continues to be the major driving force behind its parent company’s record-breaking profits. Jagex posted revenues of £84.9 million in its last financial year, which is an increase of 14.2% year on year. Profit is also up this year to £43.5 million, making it the best year in the company’s history. Jagex CEO Phil Mansell spoke with GamesIndustry.biz about the success the company has had this year. “2017’s growth came from focusing on nurturing our RuneScape communities and finding innovations that keep long-established games fresh and exciting for all types of players.” He went on further to say, “We’ve talked about our living games vision that’s driving Jagex’s future. The heart of that vision, and where we focus the most, is creating deep engagement between our millions of players and our games. The financials are the consequence of our players enjoying and valuing that engagement.”

With Old School Runescape about to launch on mobile, it looks like Jagex has a solid future and millions of fans to help keep them going.

 

Source: GamesIndustry.biz

 

Nantworks Invests in Daybreak Games, Creates New Joint Publishing Division

Nantworks, a holding company run by LA Times owner Dr. Patrick Soon-Shiong has invested in Daybreak and together they’re creating a new publishing division being called NantG Mobile. Projects that NantG Mobile will work on include mobile versions of H1Z1 and Everquest. It will also be taking over H1Z1’s Battle Royale mode on PC. As if this weren’t all enough Nantworks is also in the planning stages of a new LA Times Center space that will serve as a venue for esports events headed by NantG Mobile.

For some who have been following the news recently all of this may come as a bit of a surprise. It previously looked as though Everquest was winding down and may be coming to an end. But with a new mobile version of the game coming out, there may be new life for the 19-year-old game.

 

Source: Press Release

 

CCP Acquired by Pearl Abyss

The makers of Black Desert Online have purchased the makers of EVE Online, CCP. The acquisition is being made for $425 million and it is expected to close around October 12th. CCP will continue to operate independently from Iceland with offices in London and Shanghai.

It was just a few months ago that CCP announced a mobile game and the possibility of a TV series while teaming up with NetEase. Last month the deal with NetEase was expanded even more to include the expansion of EVE Online’s reach in China.

CCP appears to be doubling down on their MMO since they abandoned their virtual reality aspirations when the technology didn’t take off like so many thought it would.

 

Source: Press Release

 

Roblox Raises $150 million for Global Expansion

ROBLOX

Roblox is looking to expand internationally and thanks to a recent funding round they’ve got $150 million to do it with. The funding round was led by Greylock Partners and Tiger Global Management. Altos Ventures, Index Ventures, and Meritch Capital Partners who are already existing Roblox investors. With the money, Roblox will be able to support more languages and currencies while hiring new talent from around the world.

 

Source: Gamesindustry.biz

 

Superdata Bought By Nielsen

For the last few years, Superdata has been the gaming industry’s go to market research company for information on game sales and performances. Now they’re going to be part of Nielsen Holdings. Nielsen currently operates in more than 100 countries and employs somewhere around 44,000 people globally.

Chris Morley, Nielsen Global President of Games and Esports said this, “We recognize the growing importance of the digital gaming ecosystem, and the combined strength and expertise of our businesses will deliver best-in-class solutions and services to games and esports clients around the world.”

It’s nice to see the rest of the world catching up with what games have known for a long time, games r srs bznz.

 

Source: Press Release

 

UK Charts This Week

What will come as a surprise to absolutely no one who has spent 5 minutes online this week, the new Spider-Man game is at the top of the charts this week. In fact, in the top 10, there are 3 new entries this week, including Destiny 2: Forsaken. Check out the top 10 UK gaming charts for this week below.

This Week Game Last Week
1 Spider-Man New Entry
2 Dragon Quest XI: Echoes of an Elusive Age New Entry
3 Grand Theft Auto V 3
4 F1 2018 1
5 Crash Bandicoot: N.Sane Trilogy 4
6 Pro Evolution Soccer 2019 2
7 Mario Kart 8: Deluxe 6
8 Destiny 2: Forsaken New Entry
9 PlayerUnknown’s Battlegrounds 7
10 LEGO The Incredibles 12

 

Source: Press Release

 

THQ Nordic Acquires IP Rights to Kingdoms of Amalur

THQ Nordic has finalized the deal to get the right to the Kingdoms of Amalur games, which includes 38 Studio’s MMORPG Project Copernicus. The exact details of the acquisition weren’t published unfortunately so we don’t know how much was paid for the rights. Does this mean we’ll see Project Copernicus after all? That actually seems a bit unlikely. The MMORPG genre as a whole is on the decline. It seems much more likely that THQ Nordic will create other games with the IP.

 

Source: Press Release

 

EA May Take Belgium To Court Over Lootboxes

EA is currently under investigation for their failure to remove lootboxes from Fifa 18 and it looks as though they won’t be removing them for 19 either. Based on previous statements from those in charge of EA it looks as though the company is getting ready to take the Belgian Gaming Commission to court rather than caving in and removing lootboxes. The other companies that were found to be in violation of Belgium’s anti-gambling laws, Blizzard and Valve have both taken steps to remove lootboxes from their games for Belgian players. If they did go to court, there is the possibility that the court sides with EA, which would allow lootboxes to make a return.

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Jagex Unveils a New Publishing Operation

Seems like lots of MMO companies are looking to strengthen their publishing arms. We can now add Jagex, the devs behind the RuneScape series to the list of publishing-minded studios with the announcement of Jagex Partners.

jagex partners

Jagex Partners seeks to bring the company’s expertise to bear to help third-party studios turn their live games into “living games” as its tagline suggests. The company is particularly good at it, with their flagship RuneScape now hitting the $1 billion mark in lifetime revenue.

The new publishing company will offer live game publishing and operation services across the entire spectrum of needs, including user acquisition, digital marketing, analytics systems, monetisation design and more.

“With RuneScape becoming a $1 billion franchise, Jagex has proven its credentials as a best-in-class living games publisher,” said Jagex CEO Phil Mansell. “Jagex is in a position of strength and prosperity and we feel it’s the right time to share that expertise and support other developers in bringing their games to market.”

More details for Jagex Partners are due to be introduced at this year’s Gamescom next week.

Our Thoughts

Jagex most certainly is bringing a lot of its own history and expertise to MMO and multiplayer game publishing, which could mean big things for third-party developers. Combine this with the other companies and studios out there looking to flex their publishing firms and the expansion of dev tools like Unreal Engine and Unity, and we could be in for some impressive MMO titles in the future.

Source: press release

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Jagex Talks the Future of RuneScape and a Next Generation MMO

The RuneScape games just feel like one of those series that has managed to land in the enviable position of being evergreen. That said, the folks behind them aren’t content to rest on their laurels as revealed in a recent Jagex interview, which talks about where RuneScape stands now, where the studio is going next, and a little word on its next bigger MMO project.

jagex interview

Jagex CEO Phil Mansell sat down with the folks at GamesIndustry to discuss their portfolio, which opened with a nod to the fact that the studio had lost sight of RuneScape while it focused on the Transformers Universe title. That said, Mansell notes that RuneScape and OSRS are going through a renaissance and “four years of consistent growth.”

Mansell also brought up the point of RuneScape growing outward to other platforms, noting the MMO’s arrivals to mobile gaming. Long-term, Mansell remarked on his desire to see RuneScape arrive to modern consoles, saying: “What we are doing on mobile is the same game. You can play the game on PC, log-off, and continue on mobile exactly where you were. I would like to be able to do that on every single platform, and I know not everyone allows that.”

Beyond RuneScape, Jagex is looking into expanding its horizons. According to Mansell, there is an R&D team working on a middle-budget title similar in scale to Rocket League or PUBG. Early work on a new MMO is also beginning, which is described as a “living game” that hopes to take the lessons learned from 17 years of working on RuneScape. Finally, Jagex is hoping to open a publishing arm specifically for maintaining live online games.

Our Thoughts

Sounds like a solid overall strategy for Jagex. Naturally, we’re hoping that there will be more information on the studio’s next games, but we’re also not expecting to hear much more about anything new for at least another few months or years perhaps.

Source: GamesIndustry

Articles Related to This Story

Jagex is Working on a New Free-to-Play MMO
RuneScape Provides a Peek at Summer Updates
Old School RuneScape Mobile’s Beta Begins on iOS

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