Reading Time: 10 minutes

Top News

#1: Sony Races the Clock on Free-to-Play Gaming

Sony has so far kept quiet about its mobile plans, but it seems the company is now staffing up in its PlayStation Studios Mobile Division with the recent announcement of seven new key roles. Until now, the only major update to PlayStation’s mobile strategy was in August 2022, when Sony acquired the two-year-old developer Savage Game Studios with no word on what project the team would be put to work on. 

Sony might be looking to pick up the pace on mobile as Microsoft’s acquisition of Activision Blizzard inches toward regulatory approval, despite fierce pushback from both PlayStation and Google. Microsoft has said a major driving force behind the acquisition is its lack of “capability” on mobile. While Call of Duty has become a focal point in the feud, the acquisition would see King, creators of the wildly successful Candy Crush Saga, and Activision Blizzard’s teams working on Call of Duty Warzone Mobile and Hearthstone, enter the broader Xbox portfolio. 

There’s a lot at stake for Sony. While by Microsoft’s own admission Sony has a tremendous lead in the console space, it has never had a purposeful presence in the mobile market, which saw worldwide consumer spend in 2022 reach $110 billion. PlayStation chief Jim Ryan acknowledged as much during an investor presentation last May, when he stated, “By expanding to PC and mobile, and it must be said… also to live services, we have the opportunity to move from a situation of being present in a very narrow segment of the overall gaming software market, to being present pretty much everywhere.”

If Microsoft is successful in its acquisition of Activision Blizzard and equipped with its existing advantages in subscription and cloud gaming, Sony could quickly find itself lagging behind major gaming shifts of the next decade. 

PlayStation Mobile So Far

PlayStation’s desire to make meaningful headway into mobile can be traced back to 2021, when it first advertised a new Head of Mobile position. Later that year, President and CEO of Sony Interactive Entertainment Jim Ryan said the company was looking to bring its “iconic IP” to mobile within the fiscal year. The only notable IP it has leveraged since then is LittleBigPlanet with the release of Ultimate Sackboy, developed and published by well-known porting studio Exient Entertainment. 

As seen in the graphs below, that game ultimately failed to capture an audience and since its worldwide launch in February earlier this year, it has amassed a mere 500,000 downloads and a paltry $12,500 in revenue.

While Ultimate Sackboy's launch is not directly linked to the upcoming PlayStation Mobile division, it nonetheless provides insight into the feasibility and potential challenges Sony might encounter in bringing more of its IP to smartphones. There have been previous attempts at bringing PlayStation properties to mobile: Sackboy himself made his debut appearance in 2014 with the release of Run Sackboy! Run! on mobile, and Uncharted followed a couple years later in 2016 with the release of Uncharted: Fortune Hunter (which was sunset early last year). PlayStation’s push into the mobile market hasn’t been a significant one to date, but so far they haven’t demonstrated significant success. 

Sony’s console competitors haven’t fared too well in this department either. Ubisoft attempted something similar when it released Assassins Creed Rebellion in 2018, which found some early success but ultimately failed to sustain itself in the long term. It was followed by Tom Clancy’s Elite Squad, which featured familiar characters from the likes of Splinter Cell and Rainbow Six, but was shut down only a year later. 

There have also been rumors of flagship PlayStation franchises Horizon Zero Dawn and Destiny coming to mobile. Recent job listings by Guerilla Games outline a desire for experience in mobile development and a series of patents filed by Bungie showed a series of mobile control schemes designed for a first-person shooter. It’s also worth noting that NetEase, which has a long history of partnering with Western publishers to bring their console and PC games to mobile, became a minority shareholder of Bungie in 2018. 

To that end, Bungie has been working (and aggressively hiring for) a new, unannounced shooter project alongside what many in the industry believe is a mobile version of Destiny in partnership with NetEase. 

Will This Strategy Work for PlayStation?

PlayStation seems to be taking a different approach to the more common strategy of simply buying already successful studios and just hoping those studios’ existing talent can replicate past successes. Instead, PlayStation appears to be replicating its winning strategy on console, where it nurtures in-house studios to develop games for and under the PlayStation label. 

Microsoft, on the other hand, is employing a brute forcing strategy on mobile with the planned acquisition of Activision Blizzard. Electronic Arts took a similar approach in 2021 when it made an attempt to revive its stagnating mobile portfolio by acquiring Glu Mobile, which developed mobile mainstays Kim Kardashian Hollywood and Covet Fashion, as well as Playdemic of the immensely popular Golf Clash. 

Although these past two years have involved considerable challenges for the entire mobile landscape, after Apple made its infamous changes to IDFA and mobile gaming suffered its first ever decline since the introduction of smartphone gaming 15 years ago. As seen in the chart below, Electronic Arts has struggled to sustain any of the titles it acquired in its mobile spending spree and grappled with a mass exodus of leadership within Glu Mobile. 

In that context, Sony is facing an uphill battle when it comes to breaking through on mobile considering the obstacles to user acquisition and digital advertising that exist today on top of contending with entrenched competitors with more resources and experience. 

Will Sony Find Success?

Previous attempts from Sony and Ubisoft suggest the audience for console IPs do not translate seamlessly to casual mobile genres. However, delivering a more console-like experience has been successful for games like PUBG and Call of Duty which have done exceedingly well and deliver an experience closer to their console equivalents. 

It appears Ubisoft has noticed this trend with the upcoming 2023 release of Rainbow Six Siege Mobile and The Division Resurgence, which is still in development. Both games feature gameplay echoing the mainline series. Electronic Arts also released a fully-fledged Apex Legends experience for mobile. While the game was positively received, it was recently sunset as a result of various factors, including reported tensions with Chinese co-developer Tencent.

Where PlayStation could differ from the competition is its understanding of the Asian market. Parent company Sony, which dominates its home country of Japan when compared to Microsoft, owns Aniplex, the publisher behind the massively successful Fate/Stay Grand Order, and Crunchyroll Games, which recently released the worldwide version of Street Fighter: Duel to a very strong launch. 

PlayStation’s slow-and-steady approach, paired with Sony’s existing success across markets on both console and mobile, could position the company to succeed where others have failed. 

Game Launch Radar

#1: Eggy Party

• Publisher: NetEase | The 4 Winds Entertainment
• State: Closed beta (English version) | Released (China only)
• Territories: China, Netherlands, U.K.
• Classification: Party | Battle Royale
• Quick thoughts:
  • Eggy Party is a multiplayer party game featuring gameplay inspired by Mediatonic’s Fall Guys and Kitka’s Stumble Guys.
  • This game is one to watch — it has already achieved massive success in China since its release in mid-2022, ranking as the No. 1 game almost every day for the past three months in the country. 
  • NetEase reported earlier this year that Eggy Party had accumulated the highest daily active users of any game in the history of NetEase Games and “represented a significant breakthrough for [the company] in the casual game arena.”
    • The publisher just recently completed a closed beta launch of the English-language version in the Netherlands and the U.K., however no data is yet available on its performance. 
  • The player collects and customizes their “Eggy,” which drops from gacha-style machines using coins collected from playing the primary mode. You can watch a gameplay video here.
    • One of the more noticeable features is the title’s comprehensive map editor, mixing user-generated content into the standard Fall Guys formula. 
    • Players have many tools to create their own obstacle courses, which then enter the pool of available maps, making it feel similar to something like the Super Mario Maker series
  • The game also features plenty of social features, including a large social hub that feels a lot like the one from Nintendo’s Splatoon. Players can even use musical instruments in a designated concert area and perform songs for friends. 

#2: Doctor Who: Lost in Time

Publisher: East Side Games

• State: Global Launch
• Territories: Worldwide
• Classification: Simulation | Idle
• Quick thoughts:
  • Doctor Who: Lost in Time is a narrative-heavy idle game featuring some of the most popular doctors in the series in a new story within the Doctor Who universe.
    • The gameplay mostly sticks to the same idle formula East Side Games has used in its other TV adaptation titles, including the recent Star Trek: Lower Decks and The Office: Somehow We Manage. You can watch a gameplay video here. 
  • The game has been in and out of soft launch since June 2022 in countries such as Australia, Canada, and Germany. 
  • Beyond standard idle mechanics, players progress through “episodes” by completing goals that mostly require building and upgrading resource generators that progress along a saga-map style layout. 
  • The completion of each episode resets the player’s progress along the map, giving buffs that help them accelerate to later parts of the map quicker with each new cycle.
    • Players also unlock characters from the series that serve various utilities, such as automatically collecting resources for the player or doubling the rate of resource generation. 
  • The game leans heavily into the Doctor Who fiction with its various resources being named things like “Henoch Matter” and “Kerblams,” which has the undesirable effect of being quite confusing for anyone not familiar with the lore. 
  • The Doctor Who IP may prove too niche; in its first week since launch, the game has accumulated just under 200,000 across Android and iOS.
    • That’s underwhelming compared to East Side Games’ The Office: Somehow We Manage, which amassed 2 million downloads in the same time frame.

Other Game Announcements

• Sybo’s Subway Surfers surpasses 4 billion lifetime downloads. Link
• Tencent brings smash hit Merge Mansion to China in raft of new licenses. Link
• Valve announces Counter-Strike 2 as a free upgrade. Link
• Mobile veterans Kabam to launch King Arthur: Legends Rise on mobile and PC. Link
• NetEase’s Vikingard re-collaborates with MGM’s Vikings. Link
• Marvel Snap announces new competitive-focused game mode due out later this year. Link
• Pokemon Go is hosting Lets GO and Team Rocket GO Takeover events next week. Link

Company Announcements

• Royal Match developer Dream Games opens new office in London. Link
• The Playtika-Rovio deal is off – but talks with other suitors continue. Link
• Flexion Q4 financials close with another record quarter. Link
• Layoffs reported at Worms maker Team17. Link
• Super Evil Megacorp hires flurry of big-name devs as it kickstarts new Netflix project. Link
• Big Fish Games expands with new office in New Orleans. Link
• Candy Crush Saga breaks records with All Stars Tournament. Link

Ecosystem Announcements

• As regulations around alternative app stores seem more likely, companies like Microsoft and Epic Games are gearing up to launch competing app stores. Link
• China will import 27 more video games, including titles to be published by Tencent, NetEase, and Bilibili. Link
• Layoffs and downsizing continue, this time from Amazon, which laid off 400 employees in Twitch alone (alongside the departure of its long-time CEO, Emmett Shear). Link
• In Canada, a judge says that claims that EA’s loot boxes represent unlawful gaming are likely to fail. Link
• The UK government is replacing its Video Games Tax Relief program with the Video Games Expenditure Credit, which will have “a rate of relief of 34% on 80% of ‘qualifying expenditure’” (up from 25%). Link

Content Worth Consuming

• App Store discovery is dead – so what do indies do now? (MobileGamer.biz): “You’re a respected indie developer with an innovative party game. How do you get people to notice it in today’s climate? With greater difficulty than ever, it seems.” Link
• More game devs should start games companies (Elite Game Developers): “As more and more game developers are choosing to start their own games companies, it’s essential to consider whether this is the right decision for everyone. While entrepreneurship can be a rewarding and fulfilling experience, it shouldn’t be undertaken lightly.” Link
• F2P Game Startups: Keep Going or Tap Out? (GameMakers): “Joseph Kim chats with Michael Martines, CEO of FunCraft, about the challenging market environment, lessons for mobile gaming startups, when to pivot or quit, and future trends and opportunities.” Link
• Netflix taking "more strategic" approach as it ramps up dev partnerships (GamesIndustry.biz): “The company said there were 40 games due for release in 2023, adding to the 55 launched since November 2021. In total, Netflix has 86 games in the works; 16 of which are handled by in-house studios, while another 70 are being developed by third-party partners.” Link
• Lucy Hoffman: Unleashing Africa’s Gaming Opportunity (Naavik Gaming Podcast): “In this episode, Lucy Hoffman – co-founder and COO of Carry1st – joins Naavik co-founder Aaron Bush to discuss: #1 Africa’s exciting gaming trajectory, including how the region’s extreme diversity poses unique challenges and opportunities #2 The state of Carry1st with breakdowns of the company’s publishing, game development, and technology strategies #3 Lessons learned about managing company culture with a fully remote and rapidly growing team #4 How obsessing about serving customer needs could lead to even bigger opportunities down the road.” Link

A big thanks to Jack Sinclair for writing this update! If Naavik can be of help as you build to fund games, please reach out.