BEYOND ANGRY BIRDS
Ten of Finland’s industry leaders on changes since their beginnings, keeping things lean, and the road ahead
“Nowadays, even if we’re not looking for investment, there’s always somebody knocking on our door, saying: ‘Please take our money!’”
As the ships ease slowly in and out of the harbour outside, discussion within Neogames’ HQ is focused on a more energetically spirited industry, and not only Finland’s place within it but how it is driving it forward. Joining us today are PlayRaven CEO Lasse Seppänen, director of Neogames Finland KooPee Hiltunen, Shark Punch COO Harri Manninen, Fingersoft VP of publishing Jaakko Kylmäoja, Neogames Finland coordinator Suvi Latva, Next Games head of studio Jay Ranki, Small Giant Games CEO Timo Soininen, Mindfield Games CEO Ville Kivistö, Traplight Games CEO Riku Rakkola, and Touko Tahkokallio, Boom Beach designer at Supercell.
Finland has been producing hit games, such as Stardust, since the mid-’90s, but does it feel like the industry here has such a long history?
Lasse Seppänen I got my first games job 16 years ago, and at that time I felt like I was the new guy on the block, but now I feel ancient [laughs]. There are so many new people with such great talent here now, and the age pyramid is very interesting. You have a small amount of people who started in the ’90s, then a lot more who started in the 2000s, and then the mass that has been added in the past four or five years. I think it’s a good thing that we’ve been expanding in recent years – it attracts foreign talent much more than was the case in the past. I mean, a while ago, if you moved here from the US, for example, you may have been worried about what might happen if you lost the job you were hired for, but now the games industry in Finland is so big that there is no such worry. There are so many options.
KooPee Hiltunen The number of employees [in the Finnish videogame industry] has more than doubled in five years. For the first 15 years, the game industry here was kind of a small-scale business, but from 2010 onwards, the business has been growing dramatically. One of the starting points for that was obviously Angry Birds.
Harri Manninen Access to funding and having capital is the thing that’s changed so much. When we were founding Rocket Pack in 2010, we didn’t take any angel investment, but we might’ve been able to get something like ten or 20 thousand Euro as a seed round. Money wasn’t really available in many cases, and that has completely changed in the past five years.
Jaakko Kylmäoja When Angry Birds became a hit, a lot of people took notice. They realised that you can actually make great revenues in the game industry. When I was founding my own game company, in 2009, it was really difficult to get any kind of funding – we had to think up new kinds of strategy. Nowadays, though, even if we’re not looking for investment, there’s always somebody knocking on our door, saying: “Please take our money!” [Laughter.]
Suvi Latva I think that during the past couple of years we’ve reached a position where Finland has become one of the hottest places to develop games. We’ve built a kind of brand. People are taking a lot more notice nowadays.
Jay Ranki Just the other night at an IGDA event I met a guy who has a dream of creating a pub with a videogame theme, and because he sees Helsinki as such a hotbed of videogaming, he wants to set it up here. He feels that this is the place where he could have success with that sort of concept. That tells you a lot. Someone totally outside of the industry, just an avid gamer, who wants to start a game-themed pub, and he decided that the place to do it is in Helsinki.
Timo Soininen We’ve seen a lot of young, very talented people who see Helsinki as a stepping stone in their career. They want to come here and work with some of the industry’s best companies, some of the best people. It’s attracting a lot of up-and-coming talent, which is good for us.
JR Getting into the game industry is very different nowadays. Even ten years ago, you had to be really stubborn – and naïve, I guess – to even try to break into the industry, or you could start your own company for no pay, and work in your garage until you maybe made something out of it. But now it’s legitimately an option for a lot of youngsters coming from schools to get a real paying job and a chance to work with more experienced professionals who they can learn from. A lot of us didn’t have that option. I was very lucky to have a good mentor early in my career, but many didn’t. They had to basically invent the wheel themselves: “OK, what does it mean to be a producer? What does it mean to be a programmer? You know how to code, but how do we make games? I’ve never even talked to a person who makes games.”
The fact that the community has grown bigger and we’ve still managed to keep it very close-knit and open, to keep the discussion flowing and a real feeling of community, makes it much easier to break into it and start learning.
TS Obviously the big change came when Apple opened the App Store, and then Google followed suit. Creating mobile games prior to that, we had to build something like 180 different payment systems around the globe. There were no payment systems we could use. We spent basically all of our money like that – we wasted it all. But then [consumer payment systems for mobile] became something you didn’t even have to think about any more. Another change is that back in the day it was almost impossible as a games company to go with publishers – they would squeeze you to death – but now it seems that, with a few exceptions, it’s important to work with publishers because marketing [for mobile games] is one of the biggest obstacles. It’s very difficult to break through unless you get lucky and become well known virally. The industry seems to go in circles, and it’ll be interesting to see how long the big behemoths can really sustain the situation. What’s the next wave? How do you break that fortress?
JK Yeah, unfortunately it happens in every industry. The mobile game industry is quite young, but, as we’ve seen in movies and literature, the big players eat the small ones, and unfortunately I think it’s also going to happen in the game industry. The publishers are always going to get bigger, and it’s going to be harder for small players to [make a mark] in the mobile game charts because user acquisition is getting more and more expensive.
As we’ve been visiting studios here, one of the topics that keeps coming up is the desire to keep development teams small, even within the larger game companies. Why do you think this is such a common theme? JK It’s a more efficient way of working, obviously. KH As a nation, Finland is pretty frugal in general. There’s no over-spending on anything.
LS It’s a sparsely populated country as well. We’re used to trying to get by with the least possible resources of any industry, I think. But also, developers don’t want to carry extra baggage on their teams. They want to have a tight enough team so that they can have meaningful design
discussions with the whole group, if possible. Our teams range in size from four to seven people, and everyone is involved in the design.
Ville Kivistö It’s changed a lot. Back in the day, you needed to have at least 50 people to make a PC or console game, but now you have mobile games, and smaller PC games, which can be selfpublished, You can create them with small teams.
JK We have so many people here who were kids in the ’80s, who made games by themselves or were part of the demo scene, and we know that it only takes one person to make a game if you really want to, if you keep simple enough. So I think that’s also one of the reasons why we know what it takes to make game, from the beginning to the end, and it doesn’t always require 50 people to make it happen.
Riku Rakkola I also think it’s true that in Finland, most game companies start small. They have the coder and the graphic artist there, but they have to wear many hats, and I think that gives the basis for the concept of small teams. It’s like that in our company, at least, because we started with a couple of coders and one artist – we didn’t have time for a normal management system. When you start like that, it can be really consuming if, for example, you recruit five more people – it takes up all of your time. So basically you have to keep it small to be able to manage it. Obviously I can’t speak for all Finnish people, but I take pride in the fact that I can wear many hats, and that people in my company don’t know just one thing, they can do many different things.
Touko Tahkokallio I think that in keeping things small, it’s about being agile, so if something changes I think we’re ready for it and we can adapt. Also, many of the owners of the companies here are doers in their hearts. It means that if they want to create a certain game, and they keep their companies small and flexible, they just go and do it.
JR Efficiency is obviously one of the biggest benefits, but there’s also the ownership every person can have in the team. And then there is the history, as Riku says. The team sizes in Finland have always been smaller compared to other countries, and if you worked in a small team before, you may well want to do that in the future, so you set up a company that has that sort of culture. The fact that, back in the day, we couldn’t afford big teams, and there weren’t big publishers to be creating big teams, meant nobody ever got used to that way of working. Some of us have had the chance to experience bigger teams, and to see the pros and cons of those setups, and chosen to go back to smaller teams because it’s a more enjoyable and effective way of working.
A lot of the growth here has been as a result of the rise in free-to-play as a revenue model, which means that most startups are pursuing that route, but not every company is doing so. What is the thinking behind that?
VK For us, we saw that the mobile space is really crowded, and the market has existed for a while now, and we wanted to find something new. That’s one of the reasons why we chose VR games, because that particular market is still in its very early stages, and it gives us the opportunity to be one of the first players in the market.
JR How quickly do you think that market will emerge? What will it take?
VK Well, whatever it takes, we will be there when it hits.
HM For us, at Shark Punch, after we spent three years at Disney Interactive the key thing was just getting back to the grass roots of creating games again, and seeing what the challenges are that smaller developers face today. We wanted to walk that path, and we felt that since we hadn’t had a lot of experience of building premium games for Steam, for example, we wanted to treat it as a kind of learning process as well. With [Shark Punch’s debut game] The Masterplan, once we’re fully released, we’re definitely bringing it to other platforms as well, and the particular dynamics of the platform will also influence the business model, but it’s most likely to stay premium. But the whole concept of premium is interesting now. On Steam, for example, it seems like there’s a sale happening every two months, and we’re seeing triple-A PC games discounted by 50 per cent after being on the market for only one or two months. So I think there’s a sort of race to the bottom in that market as well. Indie developers are open to sharing their experiences, and some of them have said that once you take part in a sale, and you slash the price, you can sell 100 times as many units as before, so it’s a profitable way of working. But there are so many games being released onto the market, too. It will be interesting to see where it all ends up, but with PC games it definitely feels like most of the revenues arrive at launch and then with sales. RR That seems just like a mobile app store.
HM It feels like it. It’ll also be interesting to see a developer or publisher that’s made its name in premium trying one of its products with the free-toplay model, to see how it works. It’s happened before – EA did it years ago with Battlefield – but it’s going to be interesting to see how free-to-play evolves outside of the mobile space in the future.
LS Everyone sees that so much money is in freeto-play and that there’s comparatively little in premium – even though it’s a workable business strategy for certain companies – but videogames are a creative industry. At PlayRaven, we see [free-to-play] as a creative opportunity. That’s what drives the talent to our company. We don’t advertise ourselves by saying, “Hey, come and work here and make a million bucks.” We really, genuinely think it’s a creative opportunity. At this sort of scale, free-to-play games are very young – a couple of years old, maybe a couple of years more on Facebook, and that’s it. Free-to-play games are a very young thing for designers, and they require a completely different mindset.
“Some of us have experienced bigger teams and then chosen to go back to smaller teams because it’s a more enjoyable and effective way of working”
In making the migration to free-to-play, at first you stumble – you copy other people’s games, trying to pick up anything that will sort of help you get through your first projects. But I believe that when you’ve made enough projects, you’re going to come up with something new, something creatively challenging. It’s a parallel to what happened with television. In the beginning, I’m sure the content on TV wasn’t very exciting. It was the free offering compared to the premium offering of movies at the cinema. As it evolved, though, very high-quality TV series and formats appeared.
TT There’s huge potential to find new ways to make games, and game designers need to see it as a positive challenge. There are lots of interesting angles to explore, and I think we should be really focused on that.
LS I think there are opportunities to create new classics. I look up to games like Civilization, and I’m sure there are many other brands that we all look up to, and there’s an opportunity now to redefine the classics.
JR So many people have opinions for and against free-to-play, and how it’s ruining games or how it’s making them better, or whatever. Yes, it’s a fundamental change in the design, but it’s basically a different business model, and the game design and everything around it needs to adapt to that business model. But it’s not the first time that we’ve done it. When games started to move from arcades to home machines, the economy changed. In the arcade, you had to have something that players would put coins into every X minutes, otherwise it was going to get booted out, and a game that monetises better was going to take its place – and that thinking dominated game design. Then, when those same designers starting making games for home systems, they designed the same kind of games for a long while, until they started learning that this new media and business model combination gave opportunities for different kinds of games. Then it started evolving. And it’s the same thing here. We’re still very much in the infancy. We’ve sort of cracked a few ways to monetise in free-to-play, and we’ve cracked a few genres that work, but I believe that for lots of us it’s just the tip of the iceberg. There are so many different kinds of games you can explore. Free-to-play will look very different in five years’ time. But obviously it’s a very lucrative business model for developers, and it’s a very attractive business model for consumers, too, because they don’t buy an unknown box, they start playing something and only when they’re actually invested emotionally into it, then they start spending money. It’s a low-risk entry proposition for the player.
JK Also, in terms of a long-term strategy, if you’re going to publish lots of games – and not just your own games, but those of other developers, as we do – with free-to-play you have access to lots more players, which means that you can cross-promote your forthcoming releases more effectively. There have been over 350m downloads of the games we’ve published, and we have organic growth across all of our games that way. With premium games, we wouldn’t have that – we wouldn’t be in a situation where we could actually publish games from other developers.
SL The changes in the software industry have been so significant lately. Developers have to pay so much attention to new business models and new value chains, and there’s a huge amount of service providers to consider – you deal with metrics companies, for example, and all sorts of different specialists. There are so many different elements, and for us at Neogames, we’ve always been very focused on supporting companies as businesses, but we also need to place a lot of attention on the creative side. You may have a great business, with great user acquisition and marketing and everything, but if the creativity in your actual product is lacking, it’s a problem. There are rules for things like user acquisition, but being creative isn’t so straightforward.
HM Yeah. We are in a creative industry, but I met some people from Asia at an event this summer, and they had a really cynical view of free-to-play. It was almost like an Excel exercise for these guys – it didn’t really matter what the game was like, as long as the LTV [lifetime value (of a consumer)] is bigger than the CPA [cost per acquisition].
JR People who think like that are important in one respect, but you have to keep them far away from the people who actually make the games.
TT In most cases with game design you just have to follow your own heart, and what you feel works well. You shouldn’t pay too much attention to anything else.
Finland has seen lots of change in recent years, which is obviously a result of the fact that the game industry moves very quickly, with rules that change constantly. Do you ever find that frustrating, or is it always a positive thing?
HM It’s the best part. JR I think the constant change in the games industry is what makes us us. It forces you to stay dynamic and in a way to stay young – you look at people of your age in other industries and they seem so much older, so much more stuck in their ways, frozen in time. If you want to stay in the games business, as you grow older you have to renew yourself, and try to stay young. And of course you work with a lot of younger people, and they help to keep you young.
KH In terms of rules in the games industry, I think sometimes we follow them, and sometimes we make the rules for others to follow.