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Paul Heydon on casual gamesJuly 25th, 2007 |
Investors look for the “Holy Grail” of casual gaming is an interesting article over at Ars Technica, about a talk at the Casual Games Association’s conference last week, given by a managing director at an investment bank. Basically, he outlines the key things that investors are looking for in the space:
- diverse portfolio, but not mere aggregators: “companies that offer game portals, in-game advertising, and casual MMOs”
- not hardcore: “lasting appeal and a strong casual base along with a strong monetization potential”
- ad-friendly: “in-game and on-site with banners”
- Web 2.0-ish: “user-created content, and a simplicity of design that allows making and inviting friends a painless process”
Why the interest? Because it looks like these are games that draw recurring revenue from mass audiences, as opposed to drawing recurring revenue from hardcore audiences or no revenue from mass audiences. And costs are low. He specifically says that the Holy Grail is not World of Warcraft, because it’s too small and based on subscriptions.
Heydon’s slides are available here (PDF). One slide claims that in 2007 there were over $135m raised for this sort of project, and he lists some of the ones that raised the most money. Even scarier, he projects almost a half a billion dollars in acquisitions happening in 2007. Yikes.
So what’s the Holy Grail in his opinion?
MySpace + YouTube + Maple Story + Skype + Habbo Hotel = 100 million users.

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so I’m changing the blog to discussing purely indie game dev topics and random technical issues. Kid MMO stats Voice vs. Text argument NPD gamer study My favourite web game – Kingdom of Loathing! Casual games from investor POVs
failed handheld’ has 22M. Or twice the numbers of either the Wii or the 360. For added perspective, WoW has 9 Million users, or twice the PS3’s user base. One game is within reach of the XBox and the Wii. And some people are still saying it’s small time. For more perspective, an American Idol finale clocks in about 25-30M viewers. (It’s non-finale weeks score much lower). Last week’s top show, the finale of America’s Got Talent, had a share of 6.7, with an estimated 10.7M viewers
failed handheld’ has 22M. Or twice the numbers of either the Wii or the 360. For added perspective, WoW has 9 Million users, or twice the PS3’s user base. One game is within reach of the XBox and the Wii. And some people are still saying it’s small time. For more perspective, an American Idol finale clocks in about 25-30M viewers. (It’s non-finale weeks score much lower). Last week’s top show, the finale of America’s Got Talent, had a share of 6.7, with an estimated 10.7M viewers
[...] Paul Heydon is MD of Avista Partners, a London based Investment Bank founded earlier this year, solely focused on the media sector. His presentation at last weeks Casual Games Association in Seattle has sparked a number of conversations. With Casual Games coming of age Paul’s strategic review of the sector is recommended reading as are commentary from Ben Kuchera and Raph Koster. [...]
[...] For added perspective, WoW has 9 Million users, or twice the PS3’s user base. One game is within reach of the XBox and the Wii. And some people are still saying it’s small time. [...]