The Value Chain

Portal: Dan Prigg

Manager of Developer Relations, RealNetworks

Publisher: David Nixon

Studio Director, Oberon Games

Sergei Avetikov
IT-Territory Legal Support

Moderator & Introduction:

Gabe Zichermann
CMO, Boonty Games

November 16-18 2006 CGA Europe: East 2006

 The American Value Chain

Distributor
Developer Publisher Portal

Technology Provider

November 16-18 2006 CGA Europe: East 2006

2
 The American Value Chain

Distributor
Developer Publisher Portal

Technology Provider

November 16-18 2006 CGA Europe: East 2006

3
 The Developer 20% $ Share

• Makes Games:
– Original Ideas
– Work-for-Hire (someone else’s idea)
• Organizes all aspects of game development
• Usually absorbs development risk
• Examples: PopCap, Sandlot Studios,

November 16-18 2006 CGA Europe: East 2006

4
 The American Value Chain

Distributor
Developer Publisher Portal

Technology Provider

November 16-18 2006 CGA Europe: East 2006

5
 The Publisher 15% $ Share

• Funds Games:
– Original Ideas
– Submissions from Developers
• Distributes & Markets Games
– Pays for placement/arranges placement
• May also develop its own games
• Usually absorbs marketing risk
• Examples: Playfirst, Iwin, Oberon

November 16-18 2006 CGA Europe: East 2006

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 The American Value Chain

Distributor
Developer Publisher Portal

Technology Provider

November 16-18 2006 CGA Europe: East 2006

7
 Distributors and Technology 15% $ Share

• Provides Technologies:
– DRM, E-Commerce, Tracking
– Sometimes Development Technologies
• Provides second-tier distribution
– Aggregating smaller websites together
– Sometimes first-tier
– Manage financial and customer support
• Often combined into one entity
• Usually absorbs bandwidth/commerce risk
• Examples: Macrovision, Boonty, Digital River

November 16-18 2006 CGA Europe: East 2006

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 Portals 50% $ Share

• Deliver Customers
– Traffic aggregation, targeting, development
• Manage Customer Service and Commerce
– Take transaction, disburse payments
– Coordinate customer service
• Direct to Consumer Marketing Programs
• Usually absorbs consumer risk
• Examples: Real, Yahoo!, MSN, Shockwave

November 16-18 2006 CGA Europe: East 2006

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 Changes/Trends

• Developers  Publishing

• Publishers  Direct to Consumer

• Publishers  Growing by Acquisition

• Distribution & Technology  Together

• Portals  Developing In-House

• Portals  Combining for Greater Revenue

November 16-18 2006 CGA Europe: East 2006

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 Opportunities for You

• Self-Publish
– Most control, Own IP
– Portal Relationships are challenging

• Work for Hire

– Leverage Publishers for Immediate Revenue
– Least Creative Input

• Develop Direct to Consumer Offerings

– Control and Revenues
– Costly to start

November 16-18 2006 CGA Europe: East 2006

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 The American Value Chain - Discussion

Distributor
Developer Publisher Portal

Technology Provider

November 16-18 2006 CGA Europe: East 2006

12
 Thank You!
Portal: Dan Prigg
Manager of Developer Relations, RealNetworks

Publisher: David Nixon

Studio Director, Oberon Games

Sergei Avetikov
IT-Territory Legal Support

Moderator & Introduction:

Gabe Zichermann
CMO, Boonty Games

November 16-18 2006 CGA Europe: East 2006