We’re just getting started here, so of course these 50 partners and 90 games are just a starting point for our beta phase, which is starting very shortly. We’ll keep adding new games, which is a very important part of our content strategy. We need to keep bringing new titles continuously into the catalog. Our users always need to have something new to discover and try out. That serves retention in an important way. We have to keep the content fluid and dynamic. We’ll be observing what kind of games people like to play, what kind of games trigger social behaviors, what kind of games people want to share with their friends, and we’ll gear the game sourcing process to get more of those into the catalog.
This is an emerging front. Nobody has done this before. We can only guess right now as to what will actually be the best-performing games when we make them available on demand. But we have a lot of variety in our existing collection. We’re trying to serve all kinds of players out there with different types of games.
When it comes to the size of the catalog, we’ll be starting with almost 100 games when we begin real testing. But when all of these games are available on demand, how many do people actually start playing in parallel? How big is the optimal size of our collection?
GamesBeat: You spun out of Rovio, and you have a subscription model. You have to decide how many games should be available and how much to charge per month. It’s interesting to see a premium model coming back to mobile games.
Honkala: We’ve been talking about this concept with many game developers out there, and we’ve found that a lot of them are currently struggling with free-to-play. I personally have a very strong background in free-to-play game development. It’s a good model for some games, but there are lots of genres and gameplay types that aren’t really working that well with free-to-play. We’ve found that developers really like what we’re offering, because they see a new way of bringing back diversity in mobile games, bringing back games that are fun to play. We’ve had success talking to companies in the traditional gaming market, some of whom have very strong IP. They see this as a relevant way for them to come to mobile for the first time, because they couldn’t be as successful in free-to-play.
GamesBeat: The Japanese market has adopted some of these models. KDDI had its Netflix-like service that they charged a fee for.
Honkala: Right. It’s a familiar model for them, and they’re supporting us. We have lots of games from Japanese developers, lots of great IP like Space Invaders and Pac-Man. They’re games I used to play when I was young, and I’m very happy to see them as part of Hatch.
GamesBeat: Do you feel like you need to get more exclusives or particular games that will be a big draw for subscribers?
Honkala: Of course you need some titles like that, games that will draw a lot of press. We have a very strong portfolio. We want to have a balanced portfolio, though, so we have games for different kinds of audiences. We want to reach the audience that plays free-to-play games as well.
Jutila: If you think about Netflix, their success has been driven by original productions, having exclusive content available only on Netflix. We’ll be following the same model. To start with, all the games on Hatch have a different experience compared to what you have today, because all those games can now be played together in a totally new way. But we also have multiple approaches going. Some game studios want to develop an exclusive version of their game for Hatch specifically, to tap into some of the new social features we can offer.
We also have a number of totally new game projects ongoing, what we call Hatch Originals. These are new social multiplayer games tailor-made for the Hatch experience, fully making use of our play-together features to let people have fun with their friends.
We have a very straightforward and simple business model for our developer partners. On a quarterly basis we’re pooling all the revenues we get from advertising or subscriptions into one pool. Then we’ll divide that 70-30 in favor of developers based on the gameplay minutes for each game. We think that’s a fair model, because the better your game, the more people will play it and the more money you’ll make. So far we’re seeing a positive reaction from developers. It gives them an incentive to bring their best content to Hatch and monetize more effectively.
GamesBeat: What’s the hardest thing about executing on this idea?
Honkala: We started concepting this out a few years ago. At the time, I started thinking about what would be the next thing in gaming, and that’s what led us to these ideas around instant play and playing together. The real challenge came in building the technology – we needed to innovate and develop our own technology to make this possible. We also needed to find the right partners. We’re building on a model that no one else is using. It’s not just a matter of doing our own work. We needed to turn the whole industry around.
Beyond the tech, we had to deal with developers. We needed to educate them and make them understand that this is a new opportunity. It’s a better opportunity for many developers. We’re demonstrating with Hatch Originals that making multiplayer games for our platform is much cheaper and easier than making multiplayer games elsewhere, thanks to the benefits of our technology platform.
Next, we need to talk to consumers. We need to educate them on what gaming could be like in the future. I feel like Hatch is a more natural way of playing games. It’s simpler. You don’t need to install or download any applications. It’s easy to use, which we think will expand the audience available to games and grow the whole mobile industry.
We need to do all of these things at once in addition to pushing the whole mobile industry forward. It’s difficult to pull off, but I’m happy that we already have the technology in place. We have strong partners in that area. Our service is up and running and we’re very happy with the performance. We have key developers on board as our launch partners. Now it’s very easy to demonstrate to the public what this new experience is like. Once you start playing with Hatch, it’s hard to go back in time to when you had to download your games.
Audience question: When you built this technology, did you create something entirely new, or was it based on existing software that’s already available?
Honkala: We have a very strong technical background. My team used to build Rovio’s platform, which scaled up to 260 million users. We also built our own advertising system as part of the platform, and we’re building some other very advanced automated services. Hatch is not like any other cloud service that you can implement with APIs in other apps. We have very good technology, but we’ve built it in house. Everything related to streaming we built ourselves. We’re using different ways of processing on the cloud side. It’s more like computing things continuously on the server side. We didn’t have any existing solutions that could match our need. We had to work with our hardware and software partners to create a very unique hardware and software stack that’s not comparable to existing services.
Jutila: If I could add one point from the developer’s perspective, this is very simple for our developer partners to use. We’re running all the games in our cloud servers based on Android. If you have an existing binary version of your game running on Android, we can run it on Hatch. The developer doesn’t need to work with a new SDK. You can take your existing Android binary and we do all the rest. It’s basically a no-investment opportunity for developers who have existing premium mobile games on Android.
From the very beginning we set that as a very important goal. If we needed to ask a developer to build a specific version for Hatch and maintain a separate branch of their software, it would be a much tougher sell to keep them on board. We’re glad that we were able to build a model that can take existing Android builds and let them work with our streaming technology. In the long term, a developer only needs to support one version of a game on Android. We take care of porting the application to Hatch for multiple platforms. We’re starting with Android, but we’ll be moving to iOS and any platform that makes commercial sense.
Audience question: You described multiplayer gaming in a cooperative context. How does that work when you’re playing against each other?
Honkala: The Hatch platform provides very distinct advantages for making multiplayer games. Traditionally, if you want to make a multiplayer game, you need a complicated network protocol to synchronize the states of different sessions, because every mobile device or PC runs its own session of the game.
In Hatch, we run games on the server side, so there’s just that one session. Implementing a multiplayer game is as simple as implementing a game with support for multiple controllers. You don’t need to know anything about network programming. We have options to do things like present a different screen to each user, but in essence Hatch makes multiplayer games much easier, whether they’re co-op games or player-versus-player.
Disclosure: Casual Connect paid my way to Berlin. Our coverage remains objective.