13. Amatic Industries

As a creator of online gaming applications, Amatic Industries has managed to make a number of industries more interesting. The company has even been offering games for a lot online for many years. Since 1993, the Austrian company Amatic has been actively engaged in developing leading-edge casino games as well as sophisticated jackpot systems. The company is successfully selling its products internationally using the Amatic brand. The main features of these multi-games are a large selection of game mixes and excellent return-to-player.

Amatic Industries represents high performance, responsive design, instant play, profitability, and easy customization. The designers and developers of the company are well aware of the specific characteristics and the needs, demands, and requirements of the clients. Players have the ability to put all the functions on standby right before the game is available. Most players feel comfortable using desktops and mobile devices. After all, the company’s gaming applications have been specifically designed for any type of mobile device, regardless of the screen size. Active affiliate partners will gain full access to operational analytical reports, performance statistics, databases, tools, and tips to monitor profits and traffic.

13.1. Legacy and Innovation

Any global business, especially a creative business like games, cannot stand still and maintain its commercial success: it must develop new intellectual property and business model devices. In this respect, annual monitoring and profiling of the top venture capital investment partners to game developers is revealing. In recent years, venture capitalists invested millions of dollars, which enabled many new or small development companies to grow and move to multi-platform development or be especially focused on a single genre or type of game, rather than relying on the sale of work-for-hire licenses to pay the wages bill. A significant proportion of this finance had gone to publishers and cutting-edge hardware technology companies, aggressive in digital and broadband markets. Venture capitalist investment is a significant and particularly relevant element of world gaming business finance.

Recent static activity in both venture capital and debt financing should serve as a serious warning to the whole games industry: when prototype development companies lose access to these sources of finance, developers cease to be commercial entities, and our beloved innovative games will not be created. The accurate monitoring of venture capital activity, plus the initial public offering, mergers and acquisitions, and news from major industry players of business strategy is an important, unique aspect of analyzing global game development companies, whether in the US or international research. Commercial innovation is an important element of a company’s operational structure and is composed of Opportunity and Behavior, Entrepreneurs, Economic and Strategic Changes. Activity created and formulated wisely by top management and staff, commercial innovation will help create overall corporate growth. Large independent or private game development companies understand how and why shareholders and stakeholders wish their interests and values to be enhanced. If the commercial innovation initiative is pursued, and effective financing plans are established, senior executives will be taking an active role in strategic change, and the pace will be rapid. Substantial investor funds in the creative knowledge markets allow private and independent game developers to focus firmly on building from their strong base of core competence assets, benefiting from successful game sales, royalty, and technology licensing income.

13.2. Global Reach

Since the global revenue share of North America is low, analyzing the revenue stream of these companies provides us with an overall view of the market as well. The United States is the most favorable place to start a company as it dominates the market with the help of 23 companies. With 9 companies, Japan is the follow-up country on the list. 35 companies are from the top 2 countries. The first most favorable way is Europe with 18 companies. France, Germany, Finland, and the United Kingdom host 4 companies each. Then South Korea, where 4 companies take place on the list. China comes after them with 2 companies. The remaining two are Canada and India, one from each. As it is seen, the U.S. and Japan are successful in adding to the global developer pool. With 27 of the world’s best 100 developers, 3 of the 4 developers in the region come from these countries.

Now let’s analyze the top 5 largest market share holder countries in terms of market shares. It would be too speculative to think that 27 developers are the reason that North America is the most successful region with a 71.32% revenue share. Instead, the most successful developers emerge in the United States and Canada. With a 3% market share, Canada’s 1 company maintains its position in the market. Europe comes after North America with 18 companies, and 1 European company holds the largest market share. Then comes South Korea with 7 companies realizing a 0.6% market share. The Japanese market share, which is proportional in terms of both the number of developers and the revenue structure, is 5.7%. With 16 companies, China has the biggest market share in the region, hosting the last-known game developers.

14. Amusnet Interactive

Amusnet Interactive is the first South Korean company in the industry. In 2001 the South Korean game industry was at the peak of the economic bubble. And Amusnet Interactive was founded at that peak. Six senior developers from various companies established the company, including one person who used to work at a major gaming company. They made contributions to the establishment of the Korean Boshingyi Game Association and also made a remarkable achievement by cooperating with a U.S. company and developing Flash cartoons on the small screen.

If a company released their products with a full 3D online game and a multi-player game aiming at the global market behind, another company also began with only six members and currently expanded to 250 members. The company has released 18 products so far. After they developed the 3D SO project in Japan, they became a part of a major project, and after then they are developing an online tool project in the entertainment field. After they have succeeded in entering the North American market, they could make relations with U.S. developers and release many product items. After acquiring a famous game planner in 1998, another company has been involved in the online entertainment field and have created an online game. In addition, they succeeded in developing 3D SO products in a joint venture with an American company.

14.1. Technological Advancements

As we can see, these companies ensure advancements in almost all areas required for the development of a state-of-the-art game. Along with this, many companies in developing countries also take advantage of these ongoing advancements in software development from more advanced nations. This has enabled them to overlook low-cost limitations and employment problems in their companies. Moreover, the number of companies has grown greatly in almost all countries, competing to be part of these very profitable areas. This study has been designed to analyze how these companies competing worldwide have chosen to position themselves either using game ratings and revenues or diversification indices.

Some of the possible reasons for the advances in computer game development include the overlapping of generic computer game technologies and the contributing fields, combining the use of wide-spreading generic technologies for game development in various regional domains, a growing number of niche markets, the profit potential, rapidly growing domestic markets, the need to compete with other media forms, state support or government policies, broadband internet expansion and steady growth in the number of users, the development of core technologies for games and their research done in universities and by non-profit organizations, and the increase in R&D and networking between countries for the development of game industries.

14.2. Market Strategy

World’s leading game development and publishing companies are from North America, Europe, and Japan. Among the reasons behind the domination of these countries in game development are the ICT infrastructure, the presence of telecommunications and hardware companies, high income levels, massive investments into R&D activities, and a strong orientation of the young population towards games and game-related activities. Due to a considerable increase in the popularity of online games and videos, the connections of the firms in the telecommunications sector have become more sophisticated. The management experience of these companies is also high. Non-technological resources such as patents, trademarks, customer base, copyrights, and human capital of game developers also contribute to the high incomes of game development companies. Cultural differences and language barriers between countries lead to the development of games with different content. As a result, the increasing number of global game developers and global publishers have used localization technologies to tailor their products to local audiences. Furthermore, the localization of games can result in the addition of characters or branding of existing character content, music, narrative story components, and graphics tailored to the local market. Using the concept of consumer segmentation, the firms also make variations in game applications. The law also forces the game development firms to make regional customization for different age and cultural groups. These firms target their local customers but support several languages in order to open a global market. Referring to the low production cost and high demand, most of the game development companies are located in regions and countries with low income levels.

15. Merkur Gaming

Merkur Gaming is a subsidiary operating under the Gauselmann Group. They focus not only on online gaming content but also on producing roulette and other casino games for land-based outlets. Their online content can be found on many popular casino websites as well as in some online lotteries. A wide range of the Gauselmann Group’s more traditional games have been transferred into online games for the gambling sector. They have made a number of their most popular games available in 3D specifically for online casinos. Merkur Gaming now has a wide range of subsidiaries to help distribute their products around the world. These include Merkur Interactive, Edict, Blueprint Gaming, and Carolina Games. Merkur Interactive is a complete solution for online casinos. They not only provide standard slot machines but can also create unique promotions to drive foot traffic to their clients’ web pages. Blueprint Gaming is the leader in providing land-based versions of many web-based games. They can produce games to fit the laws and regulations that exist in many different countries, which gives them a major advantage in the more traditional lottery and video slot markets. It also helps that the Gauselmann Group has several companies that are based in various countries around the world, giving them a major presence in the local market.

15.1. Industry Contributions

This chapter closes the industry contributions with an introduction to game development companies. These industry contributions complement the theoretical models developed in previous chapters. The goal of this chapter is to provide an overview of the top game development companies and to provide examples of different business models and strategies of game developers who share success with top-selling video game titles.

Many sections of this analysis would have to start with a longer introduction to the different market participants in the video game industry. The game development companies would only have been one of these groups. Some of the developers’ business challenges are discussed in subsequent chapters, but with major concessions. Only briefly, we have discussed the classical producer problems of product and distribution channels. Considerations about product differentiation and negotiation with financial backers have emerged from a public choice model premise. Production economics is only included as far as it feeds into the game business’s main task: developing and producing video games. There are one or two other sections in which intuitive views about the developers’ problems might be used as additional departure points for the empirical research presented in this thesis, but the view remains truly brief.

More primitively, this text is simply tailored to our inability to answer and model the questions raised by the game business’s primary market participants. In combination with pertinent business theories developed by others, the internal nature is addressed. The goal of this chapter is to take a first step in this direction, to generate a first impression of the business success of video game developers who create top-selling video games, and to define criteria for further empirical research. Subsequent sections of our analysis will investigate the market response to their work and thereby gather some information about the companies’ ability to induce value.

15.2. Future Directions

As technology changes in many ways on which the gaming industry depends, it becomes indispensable to analyze how the status of GDCs will change in parallel in the near future. Balances may change remarkably for developing countries in this respect. As can be seen from the changes of several companies in the last decade, industries that were dependent on only a few countries for development can expand and diversify in these locations for new start-up companies in developing countries today.

To understand the more specific changes that are expected to happen in the gaming industry in the near future, a taxonomy refers to a specific sector. On the other hand, we expect GDCs to work in business, high-end applications, and learning as well as entertainment areas in the near future. Many areas such as e-learning, mobile telephony, public broadcasting, and science and technology, all of which are affected, relate to the speed of expansion of some economies and to investment in the GDCs in these countries. Countries that cannot invest for growth in these sectors may differ because, for example, they cannot afford access to information and communication technology that they depend on. On the other hand, highly developed economies that can gain from international and bilateral partnerships will benefit from this access and also from educational courses that can be offered from many countries, with success.

16. iSoftBet

iSoftBet entered the online casino market at the beginning of the 2010s, while using the brand Fast-CPU since the 1990s. In the beginning, the firm attracted attention by developing many games that were not typical casino games, like Mahjong. While its headquarters is in London, England, development and research activities are carried out in Luxembourg and Romania. In order to provide games to the online casino market, the company has permission from the United Kingdom Gaming Authority and the Romanian National Gambling Authority and has partial permission from the Priory Gaming Authority. Game server development was started within the Malta Gaming Authority. The company, which was launched under the name ISB Magma, has a portfolio containing 121 varieties of different casino games. This portfolio includes a large number of themed, copyrighted games. Afilias Holdings and ISB Maiden Holdings are subsidiaries.

The company, which has achieved success in drawing the attention of gambling providers to its own games, produced titles such as Nino Caves, Invaders are Back, Skullduggery, Sands of Fortune, Green Genie, and Around the Worlds. The creation of such projects was possible by being the licensee of large bodies. In a team of 220 people, in addition to legendary managers like Michael Probert, who was in charge of designing Star Trek, there are also a large number of staff with such responsibility and success. With the distribution network created by big names in the industry, games developed by the company can be played in many countries and at many gaming venues. The company’s game portfolio, which is made up of 121 online casino games, contains a large number of branded games, which are highly ranked cult products worldwide.

16.1. Game Development Process

Formally, the companies develop a project. We can think of project development as including two sub-processes: design and production. In turn, the design sub-process may include more steps like requirement identification, structure and behavior identification, and prototyping. Development companies differ considering both the quantity and detail of these sub-processes. The quality of design and prototyping is directly related to the effectiveness of decisions made. How are these sub-processes executed in the real world? Different companies, and more specifically different development teams, apply different process models. The three main models are the linear model, the cyclical model, and the parallel/incremental model.

The linear model is also called the waterfall model. In the linear model, game development consists of a sequence of two main phases. The first phase, the design phase, has two steps: requirement identification and structure and behavior identification. The second phase, the production phase, has only one step: the implementation step. The two phases are clearly separated. Activities of the project development sub-process refer to these modeling steps. It is typical not to have a step for prototype design. Nevertheless, sophisticated design and/or prototyping may be found in a few game development projects scrutinized.

16.2. Licensing and Compliance

One expense that game development companies need to account for is the cost of compliance with various governmental and non-governmental regulations. The cost varies among nations, and particularly among states in the U.S. Similar to their non-game industry counterparts, game development companies require a number of local, state, federal, and industry-specific organizational documents and approvals. Certainly, game companies must comply with all of the regulations that other public companies do. Game companies must also hold licenses that other non-video and computer game companies do not need, such as a license to make gambling games, which has some unique reporting requirements. Federal, state, and local regulators more generally oversee various areas of the gaming industry, including the software developers and their products.

17. Lightning Box Games

Australian-based Lightning Box Games is an online casino game developer renowned for its lightning-fast slot games that come in 2D and 3D versions. With a catalog consisting of far fewer games than other developers, the company chooses quality over quantity, whereby its long-standing industry name has definitely made a statement by creating riveting slots that entertain players and also help casinos boost their profits. The company itself is comprised of over 60 years of industry experience, which further enhances the quality of game production. The brand is licensed to produce games in land-based and online casinos, as well as in the social gaming sphere globally.

Lightning Box Games was founded through a partnership between former employees, who are responsible for a plethora of internet and land-based games. They have since lent their expertise to land-based and online game creation. The company has partnered with a gaming group and has produced high-quality games for online and mobile use. This partnership has allowed subsidiaries to access Lightning Box Games’ high-quality products. The company primarily focuses on game creation and does not involve itself with hosting or math models, which are handled by other host or delivery systems.

17.1. Creative Innovations

The independents main objection was to the formulaic nature of the concepts often proposed by the conglomerates under the labels Top 10 Film last Year, etc. To the independents the important thing was to be innovative, although as was pointed out by several people innovation and originality were difficult to define. One producer proposed a simple criterion that had served her well: I try to judge a game idea by asking two questions: have I seen this before and is playing between games that are similar: if the answer to the first question is no and to the second question is yes then the idea is worth evaluating further, and with variations a number of other panellists mentioned this criterion.

Whilst the concrete business proposal for each new game might well be a billion units sold there were no more Pavilions de l’Èlyssée or Transalpinas, no new descriptions of what the games were about. Members of the independent sector who specialized in adult and/or educational products wondered what the conglomerate attitude to them was if teachers and adult consumers would always have to use specialized subliminally-inspired subservient software. Inevitably a variety of other models were discussed, including concerns that the home gaming sector would become divided into the haves, whose parents could afford the costs of hardware, regular software upgrades etc., and the have-nots.

17.2. Key Collaborations

The largest regional distributor GameOn and the Viasat channel, which specializes in video game content, signed the most significant cooperation agreements. GameOn is the exclusive distributor of Playkey for the Baltics and the CIS countries. Following the agreement between the companies, any PC owner in the Baltic States and the CIS who subscribes to GameOn TV streaming can switch on the computer, start the Playkey application, and select and set the graphics parameters of the games. In a few minutes, it will be clear on the GameOn TV streaming program screen. The subscriber will be able to play successfully in the selected game. They do not need to spend tens or even several hundred lats to buy game gear that meets the necessary game requirements.

The specific interest was related to Playkey’s technology implementation feasibility in the GameOn distribution platform. Playkey’s technology has been given a favorable opinion by well-known technology leaders. Playkey technology has been rated as the best solution in the world. Viasat viewers will be the first in the region to enjoy video game evenings with the most popular video games in the world. To play these games, the viewer simply needs to acquire Playkey’s games marketing power package and install it on the TV connected to the Viasat video entertainment network.

18. Nolimit City

With a foundation and generation of professionals previously engaged in prominent roles within core game suppliers, Nolimit City has achieved fast growth. The company is based in the stock-listed gambling hotspot, Stockholm, along with a subsidiary in the rapidly expanding mobile hub of Malta. The company has unique features ranging from high-quality casino games, a powerful back office, and flexible integration to better serve satisfied customers and become a competitive leader in the industry. Innovators spread across time zones contain a wealth of experience, and we are fully aligned to attract and facilitate the best business models to spread all over the world. Nolimit City has designed and developed casino games and customer service that strive to provide the highest customer satisfaction. We believe in the power of great hires filled with knowledge, creativity, and experience who know how to build the best slots, as well as what players are seeking. Those are the folks who provide the entertainment received as wrapped games. The game provider is now offering all the details on commissioning our products along with a hassle-free experience in making our designs accessible and strong in our services to match your needs as partners.

18.1. Brand Evolution

A game’s seal, the brand, comes to represent the game itself in consumers’ minds. The brand frequently ceases to be a reference to a specific game but comes to represent a collection of game experiences. Brands have to evolve over time as much as they have to evolve in terms of image and meaning. The mental picture of a business’s game development team is the company’s “Game Identity.” It is argued that life is music and personifies their company as a three-piece jazz band. Their jazz music is a cultural symbol for the developers. Their association of their work with jazz music and its connotations of freedom and breaking new ground is significant. Every company wants to identify with a brand of high cultural prestige.

A brand’s evolution over time is a value creation process. It typically starts with breaking the mold of an existing business standard and creating a new category. In the second stage, a unique product offering leads to branding by association. In stage three, a unique product offering and branding by association lead to point of purchase recognition that is fed by naming and graphical design. The stage when the brand peaks is the posting of a point of purchase or performance point: the family has steadily reached higher revenues and ratings. A sixth stage represents a process of value extraction: synthesizing various elements creates value that is then reflected in the resulting stock price. The term “brand mummification” can also be applied to this evolution model. This refers to the maintenance and rejuvenation of brand value in a profitable manner. Evolution and change become either constant or periodic aspects of the enterprise.

18.2. Noteworthy Titles

Final chapters of the book have been dedicated to short (about a paragraph) descriptions of noteworthy game titles developed by particular companies. Our estimation of the quality and estimated revenue was used throughout these notes. We have to admit that our personal estimation of replayability was taken into account as well. For a number of serious companies that do not develop games very often, it was not possible to identify the right titles. In such cases, the positive or negative estimation refers simply to the company size, and the quality was designated with “-” sign when the company size was known to be serious, and with “0” sign otherwise. If one wants to send us some more accurate estimations, we would be grateful. We believe that conventional search engines would be helpful in this case. No doubt, this collection of games is not exhaustive. Although our main sources of information were gaming magazines and reviews, it is practically impossible to catch all the new releases and to draw a complete picture in such fashion.

1. 2015: Doctor Lautrec and the Forgotten Knights 2. 2018: Ni No Kuni II: Revenant Kingdom 3. 1997: Grand Theft Auto 4. 1999: C-12: Final Resistance 5. 2006: Rule of Rose

19. Relax Gaming

Relax Gaming is an innovative B2B multi-vertical gaming provider offering distinctive and effective solutions. The company is licensed by the UK Gambling Commission, Malta Gaming Authority, Federal Revenue Schleswig-Holstein, and Alderney Gambling Control Commission. Combining premium content from selected partners with its own unique technologically innovative product portfolio, Relax Gaming powers a broad offering that accommodates a wide variety of player styles. Relax Gaming presents an adaptive selection of custom solutions that enable an integrated offering. Relax Gaming Ltd. is licensed and regulated in Great Britain by the Gambling Commission; by the Malta Gaming Authority; by the Romanian National Office for Gambling; by the Swedish Gambling Authority in Sweden; and by the Alderney Gambling Control Commission. Relax Gaming’s offering has three main verticals: bingo, poker, and casino.

19.1. Business Model

How can I analyze the economic performance of the global game development companies and their main drivers? The video game industry is a relatively new sector, and most economic analysis of computer games and game development focuses on user preferences and what motivates gamers to play rather than on the firms themselves. Abundant trade and business press praise the viability and profitability of established and emerging firms in the video game industry. Claims of market power harming consumers are also already present.

This chapter performs an empirical analysis of the market power of video game companies and discusses performance indicators related to value creation. The ongoing economic and business research on performance analysis of companies suggests that there are quite a few concepts that could be applied to digital game companies: among others, price level and potential price discrimination, differentiation, entry barriers, marginal and sunk costs of production, customer segmentation, or the competitive conditions comprising number and size distribution of market participations. The chapter is organized as follows. The next section gives an overview of industry structures, market size and market growth rates, and key actors in the current global electronic game development. A chapter on business models and case studies of leading game development companies follows. Finally, a summary and an outlook on the ongoing evolution of the game sector in general closes the chapter.

19.2. Partnership Ecosystem

From the analysis of the internal development of the most successful game development companies, it can be concluded that companies pursue different strategies in the development of the internal set of factors. Intensive internal development focuses on factors such as the quality of the creative product, investment in in-house tools and specialized services, the development of human resources, and a strong market focus on a limited set of narrow knowledge in which the company aspires to become an industry leader. Its essence is to maximize the efficiency of scale of development and thus stand out with a relatively narrow product range among the mass of products offered to consumers and businesses by the array of suppliers of software solutions. The pursued strategy of partnership development focuses on the quality of relationships between the company and external organizations, information about which is available and largely filled with various possible forms of interaction in the same direction.

Networks are one of the most unexplored forms of interaction. In principle, any company has the ability to interact at the network level theoretically. However, the extent to which companies will be able to benefit from their involvement in the network depends on the depth of the mutual need that companies experience in the distribution of responsibilities, risks, achievements, leadership, infrastructure, and capital of the network in relation to development alone. At present, the pattern of increased external development is predominant. In the very near future, a combination of intensive development of internal factors with intensive development of external cooperation factors will prevail, which will lead to the evolution of a fundamentally new picture of the organization of the game development industry.