http://www.alistdaily.com/news/dena-west-ceo-marketing-is-more-expensive-than-creating-a-game
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We've seen more and more mobile games based on licenses like Star Wars, Marvel, Kim Kardashian, and The Walking Dead. Will licensed IP be used more often in the future to bring in players to mobile games? Is it really that effective?
It's become a really difficult market for small and medium sized studios. The top ten mobile publishers have over a billion dollar valuation, so they tend to acquire bigger IP to distinguish their games from the rest of them. Those IP based titles give you must more efficient user acquisition. Some people spend a million dollars to create a game, some spend five million dollars to create a game. But really, the marketing the game especially user acquisition is way more expensive than creating the game itself. The reality is that by using IP, you get much better CPI (cost per install), versus a non-IP based title. So even if you have to pay 15% or even 20% to the IP holder, the efficiency of acquiring a user is quite high.
DeNA has entered into a historic partnership with Nintendo to create mobile games based on Nintendo's IP. What's the potential for these games in a mobile marketplace that's already crowded with titles?
Hundreds of millions of people have bought Nintendo consoles. Those are people who decided to spend a minimum of $200 just to get access to Nintendo IP. That number is already twice as big as the Candy Crush total user base. Not only that, every single person buying Nintendo devices spends an average of about $100 per year on software. So I have no question that when Nintendo's mobile games come out, at least 150 or 200 million people will try it. These people are super core Nintendo fans who used to spending $150 to $250 just to access the content. Let's say only 10% end up playing, and then those users pay $3 a month, that's still perhaps a $60 million dollar a month game.
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