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This Week on The Metacast 

Björn Jeffery: How to Conquer the Kids Market. In this episode, Björn Jeffery – serial entrepreneur (including Toca Boca), board member, technology columnist, and advisor – joins Naavik co-founder Aaron Bush to discuss his lessons learned from serving the kids market. The duo also explore Björn’s experience founding, scaling, and selling Toca Boca. Björn also shares what he’s thinking about today, including the ongoing discussion around “AI vs art,” breaking common conventions, and advice for successful boards. Website | YouTube | Spotify | Apple Podcast | Google Podcast.

Making Sense of Web3 Trends. In this episode, your host Niko Vuori talks to two independent web3 analysts who cover the space. Thomas Pan writes a daily web3 newsletter called “Web3 with TPan,” which provides a fun and entertaining analysis of what is driving the web3 news of the day. Chris Sotraidis writes a newsletter called “Spatial Awareness,” which is less frequent but goes really deep on topics, especially as it relates to established web2 brands engaging with, and building in, web3. YouTube | Spotify | Apple Podcast | Google Podcast.

#1: Konami, Silent Hill, and Lessons from Resident Evil 

Amidst an era dominated by first-person shooters and battle royales, I can’t help but admire the impact that the horror survival genre has had on the gaming industry. Titles like Dead Space provided a welcome alternative during a time when Rock Band and Mirror’s Edge were popular. Capcom’s Resident Evil has become so well-known that it has managed to make its way into some of my favorite series, like Danganronpa and Bayonetta, by way of cameo or reference. Now, after years of relative inactivity, cancellations, and rumors, Konami has decided to revive another cornerstone franchise of the genre — Silent Hill, and there’s plenty to learn from how (and why) they’re doing it.

The premise behind Silent Hill is fairly straightforward — a protagonist carrying a traumatic background travels to the sleepy town of Silent Hill. As the protagonist ventures through the town, they run into increasingly bizarre situations as they piece together their backstory and fight off a mysterious cult looking to create hell on earth. Very horror-esque. When the franchise was first published by Konami back in 1999 it was met with positive reception, rocketing it to one of the Playstation’s top all-time sellers thanks to its use of psychological elements and unique gameplay mechanics. Much of the genre today attributes its roots back to the franchise, despite the fact that there hasn’t actually been a full fledged Silent Hill game since 2012.

The timing behind the franchise’s re-launch couldn’t be better: horror-survival is facing a renaissance, with remakes for games like Dead Space and new entries into the genre like asymmetrical horror hit, Dead by Daylight. But to understand how exactly Konami plans to turn its diehard fandom into a slice of the genre’s growing pie, I believe it's best to first look at one of its biggest competitor, Resident Evil.

Released only three years apart and serving as a large inspiration for the SH franchise, these series have always shared a similar ethos. But while both games may sit in the proverbial horror survival hall of fame, their sales charts paint very different stories. The RE series has sold nearly 100M copies since inception. Its games make up five of Capcom’s ten best sellers, and seven of the horror genre’s ten best selling titles since 1995. It has become such a staple in Capcom’s belt that the company has actually gone on record during earnings reports to note that specific income decreases can be attributed to whether or not they released a Resident Evil title in the previous year.

Meanwhile, the Silent Hill franchise as a whole has barely broken 10M units in sales (a cult hit by any means), with a majority coming from the first two entries in the franchise nearly two decades ago. The IP itself remains a source of untapped opportunity when compared to its more successful counterpart. As it follows, the question worth asking is “Why?”. Why has Resident Evil enjoyed 20+ years of success compared to Silent Hill? And why did Konami choose to reinvest in the series now? To understand the answer to these questions, let's first explore how Resident Evil took over the genre.

Why Resident Evil Succeeds

At its core, Resident Evil’s success is powered by two advantages: a flexible development mindset and an expansive world of non-gaming IP. Resident Evil’s game design has always been about innovating. The series’ initial development was fueled by Capcom’s desire to innovate away from 2D-centric games like Street Fighter & Megaman. Author Alex Aniel, who chronicled the history of the franchise’s second entry, also notes that the initial build of Resident Evil 2 was delayed a full year precisely because it didn’t innovate enough. This mindset has continued to permeate into the series’ modern games, with titles like Resident Evil 7 combining genre-first features like VR support with modern preferences like first-person camera angles to make a more engaging title. Juxtapose this against Silent Hill, whose greatest gameplay innovation ended up being canceled following Hideo Kojima’s departure from Konami and we start to see a picture of how we arrived at this point.

Take it a step further, and the image becomes clearer. Resident Evil hasn't lived or died by its mainline games. In fact, Capcom has built a robust multimedia business on top of the games that rivals the best in the industry. Their content slate includes:

• A live-action film series that totaled over $1 billion in revenue
• Several remakes and spin-offs of mainline games
• A four-part CGI anime and an upcoming Netflix live-action television series
• Four stage plays, including one musical
• Comics, Toys, Novels, and pop-up restaurants in collaboration with companies like Universal and Marvel

Silent Hill’s multimedia efforts are essentially non-existent since the mid-2000s, when the series has a string of moderately successful films and comics. While Silent Hill has remained stagnant, Resident Evil has written the playbook on how to turn the horror-survival genre into a legitimate business, and it seems as though Konami has largely ignored the opportunity… until now.

This week's SH presentation was anchored by the very same principles that have made Resident Evil successful in the first place — investments in new gameplay mechanics and multimedia expansionary efforts. Comparisons between the Resident Evil empire and this week’s announcement make it increasingly obvious that Konami is taking a page from Capcom’s book.

Announcements for Silent Hill merchandise, a Silent Hill 2 Film, a new Silent Hill MILE built in partnership with Genvid Technologies (which I’m particularly excited for), a Silent Hill 2 Remake, and of course, a new mainline prequel dubbed Silent Hill f all peppered the 48-minute long announcement video back-to-back. The sheer amount of non-mainline content is impressive and is likely the main reason it has taken this long for us to hear more about the franchise — Konami has been waiting until they can roll out the cavalry to stake back their claim in this genre.

But Resident Evil is an entrenched incumbent, and there’s no guarantee that the same playbook will work once again for Silent Hill. Fan response and investments in new formats, like MILEs, are cause for optimism, but they aren’t guarantees of success. There’s also the lingering concern of over-investment and competitive differentiation. Does Silent Hill still have enough fans to make all these media franchises profitable? Is it possible for the series to garner noteworthy enough market share from a competitor that has a decade-plus lead and five games rumored to be in development? In my opinion, the most likely outcome here is positive, but slow growth. I have no doubt that nostalgia and hype will drive remakes and new titles to generate revenue (assuming the execution is there, of course), but I imagine we’re looking at a multi-year journey to bring Silent Hill to the size and scale that Konami would like it to be.

Luckily, Konami is coming off its best year ever in terms of financial performance, and profits are at an all-time high across all categories. The company is doubling down on their existing IP, and top sellers like free-to-play Yu-Gi-Oh! Master Duel continue to print money. This gives the company ample room to invest in new ideas like an NFT marketplace, or for example, a Silent Hill reboot. Konami’s approach, in many ways, resembles the Square Enix strategy of reinvesting in core IP and pushing new tech areas. The opportunity is there for Konami to have a games and IP revival; now they just need to take it. (Written by Max Lowenthal)

#2: Game Deconstruction — June’s Journey

Recently, the number “5” has been involved in some important milestones for Wooga, the creators of June’s Journey. The world’s most successful hidden object game on mobile is celebrating its 5-year anniversary this month while having grossed $500M in revenue. The game is by far the company’s biggest hit, and it has successfully surpassed all of its direct competitors. It’s time for a long overdue look at this beautifully crafted murder mystery.

First, let’s take a look at June’s Journey’s performance and the hidden object subgenre as a whole. As we wrote a month ago, the game’s revenue has been consistently growing, even though downloads remain relatively flat, while maintaining a healthy all-time RPD increase. The updated RPD is $7.73 (on iOS), which does not even count the game’s significant amount of ad revenue.

Let’s start with a little history: Wooga was founded in 2009, and its first hits — Brain Buddies, Bubble Island, Monster World, and Diamond Dash — were all Facebook-first hits. From 2013 onwards, the company pivoted to being mobile-first and released what would be its two biggest hit titles for a long time: Pearl’s Peril and Jelly Splash. These two games, together with Diamond Dash, have been Wooga’s main sources of revenue up until June’s Journey’s launch in 2017.

As early as the launch of Pearl’s Peril — June’s Journey’s spiritual predecessor — Wooga unknowingly discovered what is now its main strength: creating high-fidelity and story-driven hidden object games. Without Pearl’s Peril unleashing the combination of episodic hidden object content on one hand, and island decoration on the other, June’s Journey would have never seen the light of day.

The hidden object genre has always been niche, and it has proven to be Wooga’s key market segment to this day. Especially after the company announced its vision to become the market leader in creating story-driven casual games in 2018, no other subgenre has been more suitable to fit its ambitions. The visual storytelling in this genre is unequaled due to the ability to paint beautiful scenes even within the core game. Whereas other puzzle games struggle to combine the stories in their meta games with highly abstract challenges at their cores, hidden object titles have the potential to become something much more immersive and meaningful.

However, creating these games has not proven to be an easy path to success at all. Monetizing players without a loss condition is a tricky endeavor; companies like Playrix even pivoted away from hidden object, changing the core of one of its most prominent games, Gardenscapes, to level-based puzzles at the last moment. At the start of the Covid-19 pandemic, Playrix took another stab at the genre by combining its answer-to-everything mansion decoration meta with a hidden object core. This resulted in Manor Matters, which achieved profitability but has been suffering from a heavy decline a bit more than a year after its launch. Even genre-expert Big Fish has not been able to translate its expertise from browser-based hidden object games into mobile success.

The magnitude of June’s Journey can easily be described as monstrous, which is why so many competitors have failed or refrained from trying to replicate it. While Manor Matters and June’s Journey have some overlapping features (like their core gameplay and alliterated titles), the two games are incredibly different. The (worst-kept) secret that makes this genre so difficult to penetrate — and what has been key to the success of June’s Journey (and the demise of Manor Matters) — is narrative. Whereas games with the decoration loop usually have paper-thin stories tacked on with practically zero character development (with rare exceptions like Lily’s Garden and Love & Pies), June’s Journey is truly story-driven, releasing a weekly chapter of fresh narrative since 2018 without fail.

Now, it’s not a secret that a big part of the mobile audience does not seem to be interested in narrative arcs, but the other part of the audience that is looking for narratives is incredibly loyal when they find a story they identify with. This is especially true for the audience that Wooga has found with June’s Journey, which predominantly consists of older ladies.

On a more personal note, as an advocate for engaging narratives in any medium, I don’t think that the strong appeal of the game’s setting to its audience demographic (New York in the roaring ‘20s) is the single unique factor to its success. Only stories deep enough to bring forth interesting stand-alone fiction outside of the game are able to drive it forward and make players invested in what’s next. We haven’t seen many great casual game examples of super engaging narratives yet, but games like June’s Journey show it is doable.

However, even games with smooth core gameplays, great audience fits, alluring storylines, and fun, decorative metagames don’t naturally retain players for years on end. In June’s Journey’s case, the game’s steadily increasing RPD has been correlated with its growing arsenal of strong live-ops features. In fact, June’s Journey is a perfect example of how a high-potential hit game can steadily grow to be #1 in its genre through engaging live-ops and community management.

This article will shed light on this thesis by:

• Comparing the June’s Journey core gameplay to the competition it surpassed
• Analyzing its core, loop, and content pipeline
• Listing its base features
• Breaking down its live-operations
• Covering examples of its best-in-class community management
• Pondering what the future holds for Wooga

Content Worth Consuming

What Makes A World Class Video Game Producer (DoF): “This week, I had the delight of brining a true legend of game production onto the Deconstructor of Fun podcast! There are few leaders in the industry whose CV even comes close to Rod Fergusson, who currently serves as Senior Vice President and General Manager of the Diablo franchise. With credits including Gears of War, Unreal Tournament, Shadow Complex, Infinity Blade, Bulletstorm, BioShock Infinite, Microsoft Train Simulator and now Diablo, few producers have had a lead role in as many big name franchises as Rod”. Link

Global Gaming Report Q3 2022 (Drake Star): “Q3 saw a significant increase in M&A volume to 81 announced deals, up from 70 deals in Q2’22. Unity’s announced $4.4B acquisition of ironSource was the largest deal in the quarter. While the majority of the deal values were undisclosed, many of the top buyers were active including Embracer with 8 deals (Middle-Earth Enterprises, Tripwire, etc.), NetEase (Quantic Dream), Sony (Savage Games, Repeat.gg), Zynga (Storemaven), and Scopely (Stumble Guys).” Link

Long Live Call of Duty Online! (DoF): "Back when CoDO was conceived, consoles didn’t officially exist in China, AAA Mobile gaming was not yet a ‘thing’ and PC gaming mostly happened at Internet Cafes, where gamers paid to sit in front of computers to play, watch videos, eat, smoke and chat. Given the lack of copyright enforcement, all western games were pirated, making premium games a losing proposition. However, even back then, Chinese players would spend a substantial amount of money in microtransactions which, thanks to a massive gamer population, were driving multiple franchises above the annual billion dollar revenue mark, making the free-to-play model the only way to build a viable business." Link

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