This is part of our coverage of the Infinity Ventures Summit 2013 in Sapporo, Japan. You can read more of our reports from this event here.
In contrast with that GREE and Mobage (by DeNA) who released a wide range of web-based game titles, native apps are grabbing much more attention, notably Puzzle & Dragons and Line’s repertoire of gaming apps. But can their revenue be sustained? And how will they lead the smartphone app market?
We had a chance to hear from Jun Masuda, chief officer at Line Corporation, where he spoke about how to monetize apps and open the platform to the third-party developers.
According to the stats from App Annie CEO Bertrand Schmitt, the Line app was ranked in 4th as of last March, based on consolidated global revenues from the iOS Appstore and Google Play.
Masuda: For message app developers, you usually make money by selling stickers, ads, and charging for derivative services. For social network providers, you may might make your living with advertising. But if you rely only on that revenue stream, it’s far too difficult to sustain your business. It’s important to mix up revenue streams, both charging users and with advertising, and keep that in balance. Sale of stickers is showing good numbers, and the app is ranked in first place if you exclude gaming apps, both on the Google Play and the iOS app store.
Popular stickers, popular characters
Masuda: We’ve had success acquiring users in the Thai market, so non-Japanese also like this concept of decorative communications, adding stickers in chat. Our revenue comes primarily from the Japanese market. Prices for our stickers are common in all around the world. Prices are relatively high for Thai users, but they still like to buy the stickers.
In terms of sticker sale trends, we’re not seeing any apparent gap between the globally version and locally-optimized versions. A sticker showing familiar characters, Brown & Cony, is the best selling one in the global markets. In the countries where local people typically watch Japanese animation films or understand what kawaii means, the Line app business does well. In the rest of the world, however, business is not so good.
Make the most of 150 million users
Masuda: In the latter half of last year, the Line Pop app was the best selling of our gaming apps. For games there have been 140 million downloads, and 25 titles. I can’t disclose revenue numbers, but our strategy is to acquire new gaming users on the Line user base.
We intend to keep introducing titles that female users will like, but we carefully set prices that won’t force them to pay too much. They typically play the games where they like to talk with someone over the phone. We’ll try to think further on how to monetize.
If an app has its name associated with the Line app, it usually has a very high rank in the app store. Prior to the launching the app in the gaming app category, we check if the app behaves as intended, and assure the quality of its user experience.
Opening the platform to third-party developers
Line’s Jun Masuda
Masuda: We are actually receiving many inquires about opening the platform to third-party developers. But there’s no plan for the time being. As we’ve been doing until now, we’ll work with partner developers who have ideas on what kind of games are suitable for Line users. We shutdown the in-company gaming studio team back in April. Kakao has more than 200 gaming titles, which makes me feel the life-cycle of a title is getting shorter. We’re now carefully thinking what to do next.
For more information on the growth of Line, please check out our interactive Line Timeline which chronicles its growth from its launch back in 2011 up until the present day.
A Japanese creative content company called Voltage recently released an English app called Office Secrets. No, the app is not about secret Microsoft Office tips [1], but rather it’s a fun, romantic dating simulation app. The company creates romantic content for Japanese females not only on smartphones but on feature phones. With Office Secrets, female users can play a part as the main character in a story set in a fashion company. She enjoys somewhat risky love affairs with various elite and handsome men in the office. The app is faithful to the original Japanese content including different characters and stories, translating it into English in the hopes of reaching female manga fans around the world. For Voltage, this is not its first time to push content outside of Japan. Including Office Secrets, it has a total of nine apps translated into English. Another translated app called Be My Princess was released in December of last year, nabbing the number one spot in the US app store entertainment category. The app is also popular in some Asian countries too. The original Japanese content for Office Secrets was first released way back in 2006 as a game for feature phones. It…
A Japanese creative content company called Voltage recently released an English app called Office Secrets. No, the app is not about secret Microsoft Office tips [1], but rather it’s a fun, romantic dating simulation app. The company creates romantic content for Japanese females not only on smartphones but on feature phones.
With Office Secrets, female users can play a part as the main character in a story set in a fashion company. She enjoys somewhat risky love affairs with various elite and handsome men in the office. The app is faithful to the original Japanese content including different characters and stories, translating it into English in the hopes of reaching female manga fans around the world.
For Voltage, this is not its first time to push content outside of Japan. Including Office Secrets, it has a total of nine apps translated into English. Another translated app called Be My Princess was released in December of last year, nabbing the number one spot in the US app store entertainment category. The app is also popular in some Asian countries too.
The original Japanese content for Office Secrets was first released way back in 2006 as a game for feature phones. It is one the more popular games out of the 50 or so titles that Voltage provides in the Japanese market, and six million users in total have played them.
The prologue of the story is free to play, but in order to proceed with your choice of handsome men, it will cost $1.99 for the epilogue and additional $3.99 for the main story per character.
For anyone who is looking to fulfill their office love fantasy, Office Secrets is available on iOS.
This is part of our coverage of the Infinity Ventures Summit 2013 in Sapporo, Japan. You can read more of our reports from this event here. The final session of day one at the Infinity Ventures Summit featured some of the biggest names from Japan’s internet space, including Rakuten CEO Hiroshi Mikitani, Line Corporation CEO Akira Morikawa, GMO Internet’s CEO Masatoshi Kumagai, as well as Fuji Television’s senior executive managing director Chihiro Kameyama. The panel was moderated by Nikkei Inc’s senior writer Waichi Sekiguchi. The session was in Japanese, and the remarks below are selected from the simultaneous translation. 18:07 – Rakuten’s Mikitani joked at the begining, saying he’s not so comfortable speaking in Japanese. He started by pointed to the Japan Association of New Economy (you may recall we covered the JANE summit a month back). He notes that in order to bring change, there is a sort of ‘galapagos wall’ that must be overcome. 18:11 – Mikitani says that entrepreneurs who visited Japan from Silicon Valley at that event noted that Japan is on the verge of a renaissance (Phil Libin in particular felt this way). He says that in June they are going to hold an sort…
This is part of our coverage of the Infinity Ventures Summit 2013 in Sapporo, Japan. You can read more of our reports from this event here.
The final session of day one at the Infinity Ventures Summit featured some of the biggest names from Japan’s internet space, including Rakuten CEO Hiroshi Mikitani, Line Corporation CEO Akira Morikawa, GMO Internet’s CEO Masatoshi Kumagai, as well as Fuji Television’s senior executive managing director Chihiro Kameyama. The panel was moderated by Nikkei Inc’s senior writer Waichi Sekiguchi. The session was in Japanese, and the remarks below are selected from the simultaneous translation.
Rakuten’s CEO Hiroshi Mikitani
18:07 – Rakuten’s Mikitani joked at the begining, saying he’s not so comfortable speaking in Japanese. He started by pointed to the Japan Association of New Economy (you may recall we covered the JANE summit a month back). He notes that in order to bring change, there is a sort of ‘galapagos wall’ that must be overcome.
18:11 – Mikitani says that entrepreneurs who visited Japan from Silicon Valley at that event noted that Japan is on the verge of a renaissance (Phil Libin in particular felt this way). He says that in June they are going to hold an sort of Abenomics convention, and encouraged everyone to join JANE. They hope to have strong communication with the government about how to help Japan progress economically.
18:15 – What challenges are Japan facing right now? Kumagai says that the tax rate is as high as four times higher in Japan, which puts them at a disadvantage in comparison to global competitors.
18:19 – Fuji’s Kameyama explains that Japan’s mass media is currently at a disadvantage in the face of things like internet video.
18:27 – Kameyama speaks on the role of mass media in the age of internet opportunity. He says that where goals overlap between companies, it’s of course best to work together with a common understanding. We have to research what these startup internet companies are doing and see [how to proceed].
GMO Internet’s CEO Masatoshi Kumagai, Fuji Television’s senior executive managing director Chihiro Kameyama
18:30 – Keidanren (the Japan business federation which he famously left) acted as if it was the voice of the economic world. And that’s what people thought. But it became apparent that this is not necessarily the opinion of the business set.
18:33 – Mikitani speaks about lobbying the government to work on remote education, but encountering resistance because education in person was the norm. He says also that in pharmaceuticals, you can’t buy over the net, and abolishing this in-person regulation was something that was important.
18:35 – Morikawa says that society is always changing, and there are many cycles, including financial ones. In Japanese history, change was usually due to external pressures. But now we are creating an engine for change. But this is a culture that is difficult to change. It’s something like a revolution, and JANE is trying to do that in the internet space. [On partnering with Docomo] We need to compete globally, not really within Japan, trying to work together to create something new.
18:48 – Media used to be one way communication, but that has all changed. Now the individual has become more important.
18:50 – I think the internet will become like electricity. I think the many devices we use will simply be referred to by the size of their screens. I’m excited about wearable computers like Google Glass. I want one. I think in five to ten years, it might even be contact lenses. But the biggest content in that environment is communication, and social media will be the biggest part of that. I think the mass media should focus on that to, because in terms of speed, I don’t think you can compete with that.
18:53 – Mikitani talks about shopping as entertainment and communication. He says that his own shopping experience in the past in local markets, he really enjoyed speaking with the shop owners. In the states, even financial transations are becoming more like a social media activity. I think every activity in your life is becoming more social.
Line Corporation’s CEO Akira Morikawa
18:56 – Morikawa: In Japan, the fact that people use trains a lot, gives people a chance to use mobile and play mobile games. In other countries where they have to drive, they don’t have that luxury. So I think in terms of mobile [this is an edge] and that’s the area we should focus on.
19:05 – Mikitani: The Japanese market is shrinking, and you have to go compete in the international market. But because Japan’s system is so closed, many talented engineers leave Japan. In the US there are 200,000 or 300,000 engineers. We are lacking in volume, and could bring engineers from overseas. But then there are visa issues to handle.
19:13 – Morikawa encourages Fuji’s Kameyama to create a drama where engineers or engineers get admiration. The audience applauds.
This is part of our coverage of the Infinity Ventures Summit 2013 in Sapporo, Japan. You can read more of our reports from this event here. The late afternoon session of the Infinity Ventures Summit featured a panel on mobile gaming, highlighting the efforts of Japanese game companies to win over the global market. Panelists included GREE International’s SVP Eiji Araki, DeNA’s chief platform strategy officer Junichi Akagawa, and Gumi’s president and CEO Hironao Kunimitsu. The discussion was moderated by Taisei Tanaka, the CEO of Geisha Tokyo Entertainment. Araki-san explained that the US and Japan are very different markets, noting that they have had successes and failures in the US. He cited Modern War, Crime City, and Zombie Jombie as a couple of their success stories. He noted that at GREE International (in San Francisco), they work differently than they do in Japan. In the US, they have a very systemized approach across pre-production, production, beta, and general availability phases. And after every stage, there is a check point to reflect on if the game has potential to be a top 5 title. If they aren’t happy with a progress, they may cancel the game mid-way. DeNA’s Akagawa explained that…
This is part of our coverage of the Infinity Ventures Summit 2013 in Sapporo, Japan. You can read more of our reports from this event here.
The late afternoon session of the Infinity Ventures Summit featured a panel on mobile gaming, highlighting the efforts of Japanese game companies to win over the global market. Panelists included GREE International’s SVP Eiji Araki, DeNA’s chief platform strategy officer Junichi Akagawa, and Gumi’s president and CEO Hironao Kunimitsu. The discussion was moderated by Taisei Tanaka, the CEO of Geisha Tokyo Entertainment.
GREE SVP Eiji Araki
Araki-san explained that the US and Japan are very different markets, noting that they have had successes and failures in the US. He cited Modern War, Crime City, and Zombie Jombie as a couple of their success stories. He noted that at GREE International (in San Francisco), they work differently than they do in Japan. In the US, they have a very systemized approach across pre-production, production, beta, and general availability phases. And after every stage, there is a check point to reflect on if the game has potential to be a top 5 title. If they aren’t happy with a progress, they may cancel the game mid-way.
DeNA’s Akagawa explained that the biggest challenges for his company in expanding abroad is ensuring that there is a consistency of management principles as well as a synchronization of corporate philosophies across regions. Building trust and communication across different cultures is difficult, and without trust you can’t really do anything. If a game doesn’t meet it’s goal, does the fault lie with the US or Japan office? This is when good communication comes into play. He notes with a laugh that ‘nom-unication’ (a Japanese portmanteau to describe communication through drinking parties together) is a word they throw around a lot.
Solving the puzzle
In terms of developing a successful game, Akagawa made the comparison to baseball, noting that if you want a hit you need to swing many times. But interestingly, Japan’s most popular mobile game, GungHo’s Puzzle & Dragon’s is somewhat of an exception to this rule.
Gumi CEO Hironao Kunimitsu
Kunimitsu questioned whether or not the money GungHo is making with P&D can be sustained. Akagawa expressed confidence that it can continue at least for a while longer. But it was also noted that many investors overseas don’t know about GungHo, and once they learn about them, there might be some investment coming – resulting in another boost for the company.
But to continue the baseball analogy, if you are swinging and not hitting, then you need to adjust your swing. Akagawa noted that in each market, a publisher needs to figure out what is most likely to resonate in that particular area:
If you want to develop globally, in order to have a game in the top ranking, you need to localize to make sure your game is accepted. At the same time some games are not accepted by the mass public, but if you have core users you can still succeed.
But of course, then there are games that are popular the world over like Angry Birds. But Araki noted that trying to develop such a wide-appealing game can be a gamble. GREE uses a lot of data trying to figure out what will work. Gumi’s Kunimitsu-san pointed to another problem, saying that “content is a zero sum game” and even if your game is popular, but another is more popular – then you still lose.
DeNA’s Junichi Akagawa
Akagawa closed out the session by saying that DeNA has a now or never approach, and that they have to move fast. This is a sentiment that we heard before among some of the country’s more successful internet companies (most notably, Line).
It will be interesting to see how quick all three of these gaming companies can move in the near future, in their efforts to win over global gamers.
This is part of our coverage of the Infinity Ventures Summit 2013 in Sapporo, Japan. You can read more of our reports from this event here. On day one of the Infinity Ventures Summit 2013 in Sapporo Japan, we heard from 500 Startups founding partner Dave McClure as well as Shinya Akamine from Core Ventures Group on a panel entitled ‘Tales from Silicon Valley VCs’. The moderator was venture capitalist Gen Isayama. Dave started out talking about incremental innovations, noting that people tend to put Silicon Valley up on a pedestal, and they want to copy the sexiest hardest things, when many of those thing are destined for failure. I’m not saying there won’t be a Japanese Steve Jobs or Mark Zuckerberg – there already are some of those (he mentions Rakuten’s Mikitani and others) but copying 99% of an existing model, and innovating the other 1% may be much easier. ¶ Dave mentions a table top ordering device that 500 Startups invested in. He cites ordering in a restaurant as a big problem, one that people experience everyday. A device that helps you get the waiter’s attention is a great problem to solve, says Dave. “This is not creating…
500 Startups’ Dave McClure
This is part of our coverage of the Infinity Ventures Summit 2013 in Sapporo, Japan. You can read more of our reports from this event here.
On day one of the Infinity Ventures Summit 2013 in Sapporo Japan, we heard from 500 Startups founding partner Dave McClure as well as Shinya Akamine from Core Ventures Group on a panel entitled ‘Tales from Silicon Valley VCs’. The moderator was venture capitalist Gen Isayama.
Dave started out talking about incremental innovations, noting that people tend to put Silicon Valley up on a pedestal, and they want to copy the sexiest hardest things, when many of those thing are destined for failure.
I’m not saying there won’t be a Japanese Steve Jobs or Mark Zuckerberg – there already are some of those (he mentions Rakuten’s Mikitani and others) but copying 99% of an existing model, and innovating the other 1% may be much easier. ¶
Dave mentions a table top ordering device that 500 Startups invested in. He cites ordering in a restaurant as a big problem, one that people experience everyday. A device that helps you get the waiter’s attention is a great problem to solve, says Dave. “This is not creating rocketships, it’s a very simple thing – but it’s a huge market” He explains that not many startups are attacking this area, and this is particularly true in Japan. “Doing real innovation is incredibly hard, he explains, “but incorporating existing ones and improving them are much easier.”
Everybody eats. Restaurants don’t have customer lists. Retention marketing is the easiest thing, and most restaurants don’t do that. It could be made so much better. ¶
It’s worth mentioning that 500 Startups has invested in about 30 food companies already.
He points to internet marketing as a huge innovation, noting that while there’s lots of amazing tech out there, the greatest opportunity in the time that we live in is the fact that everyone is online. And most businesses are not reaching them.
For most existing companies, their business model works. There is an opportunity to attack their weak points of poor internet marketing and high overhead. You can find some big dumb business that makes money but kind of sucks. You can copy that model, reduce overhead, and improve marketing. ¶
Dave’s slides, which he describes as ‘intentionally bad’ so you’ll remember them, are below . (We don’t think they’re that bad!)
Shinya followed Dave’s presention with a little about Core Ventures Group. He noted that the first focus of his fund is seed stage investment, and they also look at people who are developing advanced technologies. They also look at B2B companies, ones that sell products to other companies.
He explains says that many of the founders that he gets behind, he knows them before they leave their company to launch a new startup. He points to Feed.fm as an example of a company with a great founder.
The variable that has the most impact is the quality of the founders. Because I’m a seed investor, I really try to identify great founders, work with them and try to unleash their powers. Of course many VCs try to do this, and it’s not unique to just me. ¶
Dave followed Shinya by noting that 500 Startups doesn’t always know if a founder is amazing, and it might take them six months or so to figure it out. He explains that product is something that his company looks at a little bit more:
We screen based on product. To me the product is the mirror of the soul of that team. The three things we look at are engineering, design, and marketing. Those are the three things that get a team off the ground. We need to see that those things are there somewhere. ¶
Shinya says he is excited that many entrepreneurs in Japan are becoming world class entrepreneurs, and they are actually teaching the VCs. He gives the examples of Gengo and Peatix as world class entrepreneurs, who would be at the top of any startup ecosystem in the world. In addition to attracting world class investors, they are bringing in Japanese investors.
Dave agrees that such local role models are great for the ecosystems. And success stories like Rakuten, GREE, and DeNA are going to inspire more entrepreneurs to take risks.
Tokyo- and Bangkok-based startup Goopa has launched its anime-focused crowdfunding site Anipipo today. The new site provides ways for anime project owners to find funding to support their productions. Supporters will receive a premium reward from project owners in return for their financial support. The site is not only geared towards motion picture projects, but it’s also open to application for music, games, books, event projects, and more. As of today, the following three projects are available and open to receive funding from supporters. Santa Company – A motion picture project by Itoso from Kenji Studio ABC of Akari – A motion picture project by Vincente from AnigoAnimtion Ponpon Pipopo – A picture book publication project by Moo The startup was launched by Japanese entrepreneur Hiroaki Taira. Some of our readers may recall that he helped us to organize our meet-up events up until last year. In addition to Taira, the board members include two young Thai entrepreneurs Vincent Sethiwan and Permsiri Tiyavutiroj, who are known for running the LaunchPad incubation space in Bangkok. The startup primarily conducts business development in Tokyo, and system development in Bangkok. Anipipo was originally planned to launch back in February, but had to adjust…
Tokyo- and Bangkok-based startup Goopa has launched its anime-focused crowdfunding site Anipipo today. The new site provides ways for anime project owners to find funding to support their productions. Supporters will receive a premium reward from project owners in return for their financial support. The site is not only geared towards motion picture projects, but it’s also open to application for music, games, books, event projects, and more.
As of today, the following three projects are available and open to receive funding from supporters.
Santa Company – A motion picture project by Itoso from Kenji Studio
ABC of Akari – A motion picture project by Vincente from AnigoAnimtion
Ponpon Pipopo – A picture book publication project by Moo
The startup was launched by Japanese entrepreneur Hiroaki Taira. Some of our readers may recall that he helped us to organize our meet-up events up until last year. In addition to Taira, the board members include two young Thai entrepreneurs Vincent Sethiwan and Permsiri Tiyavutiroj, who are known for running the LaunchPad incubation space in Bangkok. The startup primarily conducts business development in Tokyo, and system development in Bangkok.
Anipipo was originally planned to launch back in February, but had to adjust the schedule a little bit. Everything was prepared for launch at that time, but they ran into difficulties getting approval from PayPal to become a merchant, an essential step in order to provide users with adequate payment methods. According to Taira, this is because PayPal has raised the bar for merchant accounts for crowdsourcing platforms. He actually visited PayPal headquarters in San Jose, and persuaded them on this issue. There appears to be a number of dubious crowdfunding sites around the world right now, so this is probably why Paypal is being careful. But the deployment of such strict regulations on their part indicates that the market has become too big to be ignored.
You may remember that Gyao and GREE jointly formed an anime-focused investment fund back in February, another significant development that should help the anime businesses. There is also illustration crowdsourcing service MugenUp and voice crowdsourcing service Voip.
Anipipo previously fundraised 4.5 million yen (approximately $45,000) from Tokyo startup incubator Samurai Incubate. With the service’s official launch, we should expect to see another round of funding pretty soon.
Takeshi Hirano
Yukari Mitsuhashi
Rick Martin
Masaru Ikeda
