This is probably my twelfth or thirteenth GDC, so there is going to be little that surprises me anymore. That said, the shift to social over the last two years has been interesting and sharper than I expected. This year, there are some other interesting developments that I wanted to share.
There is great development talent in Col0mbia
Colombia seems like the next force in game development. For almost twenty years, I have been working with international game development teams either for contract work or licensing products and have found great talent in eastern Europe, the former Soviet Union, Brazil, etc. At GDC this year I was amazed that some of the best development teams are coming from Colombia, a territory that previously was not even on my radar. I met with multiple Colombian companies and they showed a great combination of technical competence, design flair and an understanding of the current market for social and mobile games. It is exciting to see this talent enter our space. Takeaway: Look at Colombia for development and art resources.
There will be a big consolidation and shakeout in the user acquisition space
I was amazed at how many different companies are playing in the mobile user acquisition space. There are ad networks, seller mediation levels, buyer mediation levels, agencies, traffic holders looking to monetize their users, social gaming networks, etc. It is also amusing that every single meeting begins with we will give you better users for lower CPI. I guess I was lucky not to schedule any meetings with companies offering bad users for more money. Comparing all these layers to the advertising industry in more mature industries it is clear there will need to be consolidation and a shake out. I expect to see vertical integration, where a few vendors offer complete services to ad buyers and to publishers monetizing their inventory and those companies that do not end up with one of these vertical roll-ups cannot survive. Takeaway: Be careful who you partner with as they may not be around when you most need them.
Overall, more companies need exits than will get them
There are a lot of social game companies, as well as ancillary support companies, that have received one or two rounds of financing but have little opportunity to raise another round. Many of these companies raised money two or three years ago and their investors are now more focused on an exit than injecting more growth capital. I came across a lot of companies “raising” a round and only one that just completed its raise. Takeaway: There is going to be an increasing emphasis on profitability, as companies will actually need to make more money than they spend to survive.
HTML5 is gaining traction
I was surprised at how many developers were pitching projects or development capabilities using HTML5. I am still not sold on it for immediate use, nobody was able to show me a great game developed in HTML5, but given all the development resources being thrown at HTML5 it is only a matter of time. It reminds me of the adage, which I believe was from Bill Gates, that people underestimate how long it will take for a technology to be adopted but also do not realize how wide spread that adaption will be once it happens. Takeaway: Carefully evaluate HTML5 opportunities for your development and be ready to leverage this platform when it is right for your games.
The publishing model is gaining traction in social
I blogged about it a few weeks ago (my post on the publishing model in the social space) and saw this week that the emergence of the publishing model in the social and mobile space is speeding up. A year ago, 6Waves on the social web side and Chillingo on the mobile side were really the only options available and most developers wanted to self-publish. At GDC this year, the ratio was probably reversed, with more than half the developers looking for a publishing partner (probably also tied to the lack of financing available). Takeaway: The social space is evolving to a model much like the traditional game space.
The Business of Social Games and Casino 