Update, 2:15 p.m. August 31: Cafe Bazaar says there are numerous errors in this guest post:

  • Supercell is left with 61 percent of revenues after a 9 percent VAT is deducted and Cafe Bazaar claims its 30 percent.

The revenue share between developers and Cafe Bazaar is 70/30. All the prices on Cafe Bazaar app store are VAT included so the developer has already included the 9% VAT in the price of his products when the users buy that product from Cafe Bazaar. A 9% VAT will be deducted from the gross revenue and will be paid to the government but this is not a deduction from the developer’s share because he has already added a 9% of the actual price to his app. The correct figure is 70 percent instead of 61 percent mentioned in the article.

  • This enables Iranians to pay for in-app purchases using their debit card by way of an interbank system called Shetab (this is mostly because of the sanctions the country has faced).

 Each country has its own payment system and the existence of “Shetab”, like any other local payment system, is independent of the country’s relationship with international payment systems. So the sentence in the parentheses is not correct.

  • The company can’t be happy after having Supercell bump out its competitive advantage in the market — and so soon after the technical upset in February when its hosting provider, SoftLayer, decided to suddenly block all user traffic coming out of Iran. Its gamer base had to start using VPNs to access Clash of Kings, and in combination with this move by Supercell, the future doesn’t look too bright. 

“Clash of Kings” from Elex company (which is “The company” mentioned in the above paragraph) only had one day of connection problems after what happened with Softlayer. The company even added Farsi localization in the last update. The game is performing without any problems and +100 thousand Iranian users are enjoying the game. Iranian users can play the game without VPN or proxy which the opposite is mentioned in the article.

  • Sixty-four percent of mobile gamers in Iran are playing Clash of Clans, and 30 percent are playing Clash Royale. Compare this to the 9 percent share for Clash of Kings and you get a better sense of Elex-Tech’s plight.

It’s not clear nor mentioned in the article that these numbers are based on a survey with 1000 respondents in Line messenger and that, this does not cover the whole market for sure. We believe the number of respondents to this survey should be mentioned so that it will be clear this is not the result for the whole market.

  • That’s a considerable sum when you take into account that two-thirds of mobile gamers in Iran make less than $571 per month./  One is that 43 percent of respondents said they don’t trust paying through Cafe Bazaar for their in-app purchases on Clash of Clans./ In fact, about 48 percent of the Android gamers indicate using Cafe Bazaar, which is more than half the market share their CEO… 

Original article

Supercell has joined the club of foreign game developers to accept Iranian rials (the nation’s currency), at least for its flagship title, Clash of Clans.

The mobile gaming giant struck a deal on March 24 with the largest third-party app store in Iran, Cafe Bazaar, which plugs Clash of Clans into its local payment gateway. This enables Iranians to pay for in-app purchases using their debit card by way of an interbank system called Shetab (this is mostly because of the sanctions the country has faced). Supercell is left with 61 percent of revenues after a 9 percent VAT is deducted and Cafe Bazaar claims its 30 percent. The metrics on Cafe Bazaar site clock Clash of Clans downloads to over 5 million installs to date and Clash Royale at over 1 million.

Other members of the club include Elex-Tech and it’s rival title, Clash of Kings (which as of December has 100 million downloads and is a top revenue generator in mobile, on a tier lower than Clash of Clans and Game of War). The company can’t be happy after having Supercell bump out its competitive advantage in the market — and so soon after the technical upset in February when its hosting provider, SoftLayer, decided to suddenly block all user traffic coming out of Iran. Its gamer base had to start using VPNs to access Clash of Kings, and in combination with this move by Supercell, the future doesn’t look too bright.

To give you a clearer picture of the landscape Supercell is dealing with, I ran a survey between April 22 and April 24 of 1,030 mobile gamers in Iran.

Supercell Iran 2

Above: A survey of mobile gaming in Iran.

Image Credit: Jeremy Ellsworth/Edoramedia

Sixty-four percent of mobile gamers in Iran are playing Clash of Clans, and 30 percent are playing Clash Royale. Compare this to the 9 percent share for Clash of Kings and you get a better sense of Elex-Tech’s plight. There is simply no other contender to be seen, which effectively monopolizes the entire country.

Clash of Clans’ popularity has grown to soaring heights in Iran during the past few years and the newcomer, Clash Royale, became an immediate hit upon its global release. This isn’t necessarily surprising since the whole world is witnessing the stunning success of this elegant card collectible-strategy hybrid. GamesBeat’s Jeff Grubb recently reported on Newzoo’s latest figures indicating that Clash Royale is nearing the $1 billion mark globally in record time. The same figures indicate that the Middle East only contributes a paltry 1 percent share.

“I downloaded Clash Royale before its global launch by creating an Apple ID on the Canada store, while it was being initially rolled out for testing and debugging,” said Amir Lajevardi, aka CeNaRiuS, a 35-year old software engineer who distributes computer devices in Iran and has been a pro gamer for 14 years.

Clash Royale is catching on in Iran and worldwide.

Above: Clash Royale is catching on in Iran and worldwide.

Image Credit: Jeremy Ellsworth/Edoramedia

Lajevardi is the quintessential hardcore Supercell fan. He started playing mobile games about 7 years ago, but he only became a serious mobile gamer with the launch of Clash of Clans back in 2012. He was a steady contender in the top charts until he stopped playing last year, refocusing his energies to Supercell’s Boom Beach strategy game and more recently, Clash Royale, which along with Boom Beach he plays 3 hours-to-4 hours a day.

A major element to what makes the game so successful in Iran lies in the social aspect. Over two-thirds say that clans are important to them when it comes to Supercell games. It’s quite common nowadays to find that friends or even romantic couples in Iran having met through playing one of these mobile hits.

Telegram is the messaging app of choice in Iran, and that’s where clans like Lajevardi’s “Persian Gulf ” anchor all of their communications. Dedicated Telegram channels to Supercell titles are springing up all over the place. It’s where they share the latest game news, strategies, and details on offline events that offer the gamer community an opportunity to connect in real life.

The enthusiasm has even extended into esports. Iran Cyber Games (ICG) ran a Clash Royale tournament for the first time this month. It consisted of a double elimination of 50 players hosted on the Toornament esports platform. Each player paid $2 as a registration fee, with a grand prize of $400 for grabs. That’s a considerable sum when you take into account that two-thirds of mobile gamers in Iran make less than $571 per month.

But the whales exist, and they can be found in the top charts.

“I have spent around $2,000 in Clash of Clans but already $1,000 in Clash Royale,” added Lajevardi. “I know a lot of players who spend $100 a day to stay in the top charts.”

You read that write. In three months, he’s spent half in Clash Royale than he has in three years in Clash of Clans. One thousand bucks is quite the sum to fork out for a game that has been around for only a few months, especially by someone who lives in a country with a GDP that is 9 percent that of the United States. He ranked 5th last week and 12th this week in Iran, which is of no surprise to any Supercell player who understands the intense volatility at work. A single match can swing you in and out of the top spots.

Supercell’s deal with Cafe Bazaar is certainly a step in the right direction, but it needs to address a few stumbling blocks. One is that 43 percent of respondents said they don’t trust paying through Cafe Bazaar for their in-app purchases on Clash of Clans. Like Lajevardi, they prefer to pay using gift cards that are trafficked illegally into the country in abundance and allow them to stick to the official app stores.

In fact, about 48 percent of the Android gamers indicate using Cafe Bazaar, which is more than half the market share their CEO, Hessam Armandehi, proclaimed back in Game Connection last year on a panel we were both on (85 percent). The other half (52 percent) are downloading games primarily on Google Play. Even more telling is that 82 percent say that they would prefer to use the official app stores over third-party ones if they were simply more readily available to them.

The other issue is that global pricing of the in-app items is simply too expensive for ordinary Iranians. Over half or 53 percent of those who play Supercell games have never even made an in-app purchase. Of those who do pay, 46 percent primarily pay by Shetab, 34 percent by credit cards that are somehow acquired in foreign countries, and 21 percent by gift cards.

One immediate step Supercell can make in order to help support Cafe Bazaar is to release a formal statement of its official entry into the Iranian market and the legitimacy of this newfound partnership.

Amir-Esmaeil Bozorgzadeh is a cofounder at Gameguise, a Dubai-based publisher of online games in the Middle East and a consultancy to global game developers and publishers that need local help in understanding and operating in the market.