Rumble Entertainment chief on the agony and ecstasy of making hardcore mobile games (interview)

Rumble Entertainment has grown up in the age of digital games. A well-funded startup with a veteran game crew, it started making social games for Facebook and the web a few years ago, and then it expanded to mobile games in the past couple of years. Chief executive Greg Richardson has learned a lot of lessons on the way about making hardcore games for both mobile and web interfaces.

Earlier this month, the San Mateo, Calif.-based Rumble launched its iOS version of KingsRoad, a fantasy role-playing game (RPG) with a ton of content and high-end production values. It is one more test whether hardcore games will make it big on mobile devices and whether it’s still possible to crack into the top ranks of the highest revenue-producing games. Richardson believes that assembling a great team, making awesome games, and a little bit of luck, is the secret formula. We talked with Richardson, a former game investor at Elevation Partners and former CEO of hardcore game studio BioWare/Pandemic (now EA’s BioWare division), about the mobile game business and what will happen in 2015. Here’s an edited transcript of our talk.

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GamesBeat: How long did your team work on KingsRoad?

Richardson: Way too long. We started the game almost three and a half years ago. We started the mobile version a little more than a year ago. We had to rebuild the whole user interface. We made some changes to how to auto-attack and some other things you have to take into consideration playing on tablets and phones. The phone version will be out in about 30 days, and then Android will follow.

GamesBeat: Is the game any different on mobile, or is it essentially the same as on the Web?

Richardson: We think we’re breaking new ground in a couple of different ways. We believe this is the first full-blown action-RPG on any mobile device, as far as depth of content and full synchronous multiplayer. It’s an order of magnitude more than any RPG that we’ve seen. It’s also a unified code base. You can play on the iPad with Evan on his PC. While the games look different, and there is an auto-attack on the mobile side, the game is playable across platforms.

People love it. At soft launch, about 25 percent of our mobile players were playing on the web every day as well. That cohort was really good. Those people played a ton, spent a lot of money, and never left.

GamesBeat: Can you describe the core of the game?

Richardson: It’s a three-fourths isometric-view 3D action-RPG, inspired by Diablo. It has a tremendous amount of depth around the different kinds of missions and maps that you can run with up to three players at once. We have everything from events and tournaments to a player versus player (PvP) arena to a very story-driven single-player campaign.

GamesBeat: Three at once, is that cooperative, playing as a team?

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Richardson: The game is primarily co-op, player versus environment (PvE). Obviously there’s a lot of competition between individuals in the events and tournaments. In the arena, we do this hybrid thing that people love, where you run a PvE map, fighting bad guys, but you can kind of mess with each other. It’s all about who gets the top score. It’s one of the most popular features in the game.

GamesBeat: As far as day one, how much depth is there – how much progression can you go through? What do you plan to add in the near future?

Richardson: It’s a big, big game, with hundreds of hours of content right off the bat. Like the best of free-to-play games, what you want to do is make the game addictive early — really accessible, really hard to put down. We think we’ve done a great job of that. But then the focus shifts to the elder game. What makes someone want to play this for a year or two? That’s where our emphasis has been. We have tremendously good veteran retention. A lot of what we’ve added has been things that the elders have requested — a guild system, tournaments, events, the arena.

We have a lot more coming. We have new content every week — a new event, new maps, every week. Usually every six weeks or so we put in a big new feature. The big one coming soon is a much more robust guild-versus-guild system. That’s one of the most requested features from players.

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GamesBeat: When you’re doing this and you’re watching the rest of the mobile gaming industry grow, what are some things you’ve learned? What are some observations you might have about the larger market?

Richardson: It’s been an interesting year in mobile. The games that were king of the hill in 2013 are still king of the hill at the end of 2014. We’re starting to see this situation where the two most valuable skills to be a successful business in free-to-play are, one, having the ability to drive really high lifetime values out of a user base. That’s all about long-term engagement and thoughtful monetization. It’s pretty simple math. You want to keep people playing for months or years and you want to have those people see a lot of value when they spend money. That’s what Game of War, Fire Age, Clash of Clans, and on the casual side Candy Crush have been able to do.

The second piece is you have to be a marketing machine. You have to be thoughtful, analytical, and well-capitalized to be able to take advantage of those high LTVs you’re driving with your game, spending money to continue to feed and grow the business. That’s created some haves and some have-nots, people who have the war chest and who don’t. There are people who understand how to build games that will retain people for a long time, and there are those who don’t.

GamesBeat: There are games with great gameplay and games with great brands, and then there are games with neither that are feeling the pain of having to spend money on user acquisition.

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Richardson: Let’s talk about that a bit. It’s funny. You’re really trying to solve for two things. First, let’s try to solve for user acquisition. How do I make user acquisition less expensive for me than for other people? First of all, I build a really good game that Apple and Google want to feature, that the press is excited about, and that people tell other people about. That’s an important component.

Second, I want to brand. Do I have an existing brand, a licensed IP brand, a brand I bring over from the console or PC world? Is there something that gives me recognition and creates a bit more excitement in the user when they go to download the game?

The third piece, which very few companies have taken advantage of – I think we’re going to be the first at any scale with a mid-core game – is cross-platform. King used the virality of Facebook to create an incredible virtuous cycle for user acquisition when they launched on mobile. If you’ve seen the charts for the last few weeks, you’ve seen SGN do a very similar thing with Cookie Jam.

We’re just about to embark on that with KingsRoad now that it’s launched. We’re lucky that Apple has put us in the Best New Games feature. We have a web audience of millions of players that we’re going to engage on the tablet side. We’ve been lucky in that we’ve bought less than 10 percent of our installs. We’ve had about 6 million installs of KingsRoad on Facebook and the web. We’ve had great word of mouth. High user rankings have helped us. Facebook offers some strong innate virality. We’re going to leverage that to help us grow our base on mobile, without necessarily having to spend huge amounts of money.

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GamesBeat: I don’t know if King has described it quite that way. What they used to say was that you couldn’t really update that often or independently on mobile, while you could do that in a complete self-serve way on Facebook. They would launch a game on Facebook to get all the bugs out and optimize and get it in great shape, and then once it was growing well there they could then consider taking it over to mobile. Facebook was almost a proving ground in that way.

Richardson: That’s fair. We’ve certainly gotten that same value. Patience matters. It shouldn’t be lost on anyone that Game of War took three years to build, and likewise KingsRoad. Vainglory took quite a while to build. These explosive, genre-defining games require patience. King had a huge advantage starting Candy Crush on their own portal and on Facebook before they started on iOS. They could polish it and iterate on it.

The reason they’re not talking about this is, telling everyone that cross-platform is their secret sauce isn’t a smart thing to do competitively. But you just have to look at the numbers. Go through their financial filings. They did about $40 million on the web in the quarter before they launched on iOS. Of course iOS grew within two quarters to I think $120 million that second quarter. But here’s what’s interesting. The web business went from $40 million, a stable number at the time, to $90 million. Not only did mobile increase the overall size of their business, but it drove their web business higher. They clearly got huge advantages in user acquisition because of the virality they had and the ability to drive users on Facebook over to mobile.

GamesBeat: How does this different kind of acquisition come into it now with television advertising, which we’re starting to see more of?

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Richardson: That’s a reflection of companies that have really high lifetime values in their base. They can afford a higher cost per install. As I said, it’s the haves and have-nots. Being on television can really help those companies take advantage of high LTVs. They can reach a broad audience and turn those people into a handful of high lifetime value (LTV) customers going forward.

There’s something else going on with video and television. I think you’re going to see, in 2015, more new genres introduced, or games that define genres, that are very much more reminiscent of PC and console games. They’re also going to have high graphic fidelity. They’ll appeal to gamers. Vainglory is the first example of that, I think, in the MOBA category. You’re going to see others. Those games will get outsized interest from Google and Apple, the press, everybody. They’ll play really well on Twitch and other video apps. They can be successful on television. We plan to do some television for KingsRoad, probably in Europe. Certainly something we’ll experiment with.

GamesBeat: Ucool launched their Heroes Charge mobile game in August, but they’re doing TV ads already. They mentioned was that the cost per install (CPI) had risen so much with targeted mobile advertising that TV isn’t all that crazy as an expense anymore.

Richardson: When you live in a world where your entrenched competitors can afford to outbid you on direct advertising by two to one, you have to find alternative means. Those can be brands. Those can be, as I said, cross-platform. It doesn’t surprise me that those guys are thinking that way. But if you want to win in mobile, you’d better be designing a game that you think can get to high LTVs, that you think is going to have very strong retention, and that’s going to have some outsized advantage from a user acquisition perspective. The gameplay has to be great, or it has to be cross-platform, or something else.

This isn’t for the faint of heart. Just building a fun, good-looking game is not enough. As we see the shift to companies building games that look more like console and PC games, and as we see that synchronous multiplayer can have an impact – like with Vainglory and KingsRoad – that’s exciting, but it’s insufficient. You still have to build a game that can keep people around for a year or two and give them opportunities to spend money. That’s not easy.

GamesBeat: I heard both John Riccitiello and Bobby Kotick talking about mobile before, predicting that at some point the brands were going to come to rule the top-grossing charts. Activision didn’t necessarily understand mobile. It couldn’t make a game like Call of Duty number one every year in a row, the way it can on console where it understands that business so well. The interesting thing is, we got there, but with Clash of Clans and Game of War and Candy Crush Saga. That prediction has unfolded in a different way, but we still have that static leaderboard.

Richardson: The thesis that John and Bobby had, that brands are going to land and make a difference, I would agree, but it’s only half the battle. Whether it’s Battlefield and Call of Duty or Star Wars and Marvel, brands matter. They help on the user acquisition side. Not only do you get to leverage a known brand, but you have a big audience you can reach out to.

GamesBeat: The difference is that it turned out to be homegrown mobile gaming brands that have won so far, not established console brands.

Richardson: You and I have talked about this going back three years now. Those guys were still very focused on the business where they were making the most money and that they understand. The innovator’s dilemma applied for all the console and PC guys. That’s why it was companies like Machine Zone and Supercell and Gung Ho and King that took the early lead.

Here’s the problem for EA and Activision and people going out to get the big licensed IPs. They still have to figure out how to drive $30, $40, $50 LTVs over a couple of years. Brands are going to help to lower the CPI, but that LTV requires understanding free-to-play design, running games as a service, live operations and events. That will be hard-earned knowledge for the EAs and Activisions. They’ll have a tough time competing with people who’ve been doing that in a very focused way. While they’ve been dividing their focus, in EA’s case, or putting all their focus on console, like Activision, companies like Rumble and Machine Zone and Supercell and Gung Ho are focused on designing games that retain people for years and drive really high lifetime value.

GamesBeat: What do developers need to do to crack the top 10 top-grossing games list now?

Richardson: You’d better be designing good games. You’d better have the talent and the ambition to want to be a top 10 game. To do that, you’re going to have to invent new genres or establish genres on mobile. You’re going to have to take technical risks against things like synchronous multiplayer. You’re going to have to be patient, iterate on your game, and make sure it’s great. Only a handful of companies are going to be able to do that.

It’s also going to take a lot of marketing money. Capital is going to matter. It matters more than it did in the console business at a similar point in its life cycle. When someone was spending $40 on a packaged game, they would ask their friend what they thought before they bought it. They’d read your review of the game before they bought it. When it’s free, in the world we live in, there’s less of that natural word of mouth, and less value from critical reviews. That means there’s a premium on advertising.

By the way, I don’t want you to misconstrue this. There’s still a lot of value in word of mouth and a lot of value in the press. We’re counting on both with KingsRoad. We’ve seen the value on the web. It’s just muted relative to what we saw in the packaged-goods business.

GamesBeat: I thought it was interesting, when I visited Supercell in Helsinki recently, that they stayed small. They have 150 employees. 110 are in Helsinki. They only have 15 people working on Clash of Clans. Yet they may push $1.4 billion in revenue this year. I guess they’re just leaving that money in the bank.

Richardson: I think they may do better than that. I don’t know if they talk publicly about their numbers, but I would guess Clash of Clans is approaching $7 million or $8 million a day. I think having small, focused teams allows for creativity. It allows for great communication, which leads to innovation. It’s been a really successful recipe for them. They also have a game where the kind of content they’re producing doesn’t require a large art staff. KingsRoad is a bit bigger than their teams. We have more than 20 people. But we have a deeper, more content-driven game than Clash.

I’d guess that a large portion of Supercell’s revenue goes into marketing. I don’t know what percentage they spend on it, but given the number of television ads you see and the amount of direct advertising you see, it’s probably a material part of their budget. It’s global.

GamesBeat: How many people do you employ overall now?

Richardson: We’re 60. We feel bigger than that, I think. We outsource quite a bit of art and we work with third-party developers. We’ve announced one game coming from a third party, a first-person shooter called Ballistic.

GamesBeat: Any other observations you’d like to leave us with?

Richardson: As a natural evolution of the space, because of all the things we mentioned, you’re going to see fewer, bigger, better games. When I say “better” I mean higher quality gameplay, more polished experiences, but also just getting more refined as far as how you engage users over a long period of time. That’s going to cost more money to build and take more time to build. That’s where the business is headed.

The great new for all of us that love to play games is we’re going to see a lot more innovation. We’re going to see full-blown action-RPGs like KingsRoad and MOBAs like Vainglory. Hopefully soon we’ll see a world-class first-person shooter that’s been completely redefined for mobile. We’re going to see some new genres that didn’t exist on a console or PC. The next League of Legends or the next Minecraft, something that invents a category, I think there’s a bunch of those waiting in the wings. That’s an exciting time. Hopefully it’ll change the dynamics of the business.

Again, don’t sleep on the billions of people who have PCs and still like playing games on PCs. Not only will cross-platform be a big deal from a standpoint of lowering acquisition costs, but it’ll also allow you to stay more engaged with your player. They can play throughout the day across a lot of devices. The more engaged they are, the more valuable they are.