Gaming execs: Join 180 select leaders
from King, Glu, Rovio, Unity, Facebook, and more to plan your path to global domination in 2015. GamesBeat Summit
is invite-only -- apply here
. Ticket prices increase
on March 6 Pacific!
Welcome to our fourth annual GamesBeat conference. I’d like to thank everyone who got us here. Matt Marshall, Alicia Saribalis, Stacy Cohen, Elyssa Thorp, Shannon Dow, Garrett McCullum, Jason Spangenthal and the rest of our great VentureBeat business staff. On the writing side, last year we had just two game writers. But last fall we began a big expansion. Sebastian Haley came on board as our reviews writer. And he recruited Dan Shoe as our editor-in-chief of GamesBeat. Both of them are here. Please stand up. We’ve also added Jason Wilson as a copy editor on the GamesBeat team recently. That’s just our internal crew. We also have around 20 active interns and freelance writers doing stories about gaming on both the consumer and business sides. We have staffed up because we believe this is the most exciting time in the game industry’s history. We have 81 people speaking over the next two days who are making that history happen.
Our theme last year was about mobile games level up. We focused on changes that were contained to one sector. But change is spilling over into all of gaming.
This year, our theme is the Crossover Era. We’ll be focusing on transitions and transformations as companies move from one market to another, from the web to Facebook, from social to mobile, or from retail console to digital.
As a reminder, in 2009, we launched our first GamesBeat conference in the middle of a recession. It turned out to be a great time to launch the show because it was a time of great change. We had more than 500 people come to our one-day event. One of them was Zynga cofounder Mark Pincus, who was then a mere multimillionaire. Now he has come back this year as a multibillionaire. That is just one small example of the enormous change we have seen in gaming and the size of the opportunity at hand.
In 2011, we saw $1.5 billion invested in 145 game startups, up 47 percent from $1.05 billion raised by 91 companies in 2010. That doesn’t count the $2 billion raised by Zynga and Nexon in IPOs. In the first half of this year, game acquisitions are already at 88 percent of the transaction value recorded for all of 2011, according to Digi-Capital.
Game investments have slowed in 2012, but the momentum is still going strong with acquisitions, investments in social casino games, the rise of crowdfunding, and the emergence of new mobile game startups.
Disruption continues. At E3, Samsung announced it would integrate Gaikai into its TVs to deliver a cloud gaming service, and then Sony went and bought Gaikai. Nintendo, Microsoft and Sony have all embraced tablet gaming in some way. But Apple has sold more iPads than Microsoft has sold Xbox 360s. The bubble shield that protected the physical retail game industry has cracked, with sales dropping 25 percent or more year to date.
Now, everybody is running toward digital at full steam. Social, mobile, and online gaming can offset declining revenues in the traditional market. The bubble is deflating. But it’s not the bubble that we thought. It is the bubble around $60 console games and traditional PC titles that is losing its oxygen now. Pretty soon, digital game sales will surpass physical retail game sales, according to NPD.
Our favorite game continues to be to connect the dots. This year, we’re wondering who the next IPO will be. Who will be the $50 billion company in this space? I have news for all of us. That company already exists. China’s Tencent has a $50 billion market valuation, and it hosts games like CityVille, and it has expanded into the West with its acquisition of the majority of Riot Games and a recent investment in Epic Games. I’m looking forward to a fireside chat with David Wallerstein, the head of international at Tencent, in a fireside chat on day two of our conference.
You’ll notice that some of our speakers are coming back again, like Bing Gordon and Seamus Blackley. That’s no accident. We are independent, but we value relationships. And we like hanging out in the deep end of journalism, not the shallow end. This conference is a big part of that strategy, and we’re so glad you’ve come, and we hope you will help us connect the dots. You each get 1,000 virtual poker chips for showing up on time.