“The platform itself doesn’t have any value” – why games were crucial to GREE’s success

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Zoya Street interviewed Eiji Araki, Vice President of social games at GREE, as part of his research for the book on the history of mobile games that he is currently crowdfunding. In this extract from that interview, Araki describes why games are important to social networks, and how GREE and similar companies will have to change in order to adapt to a world where successful social games can cost millions of dollars to produce.

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What brought GREE to the point where it opened its platform to third party developers? What were the reasons, and what preparation was needed to make this possible?

For most platforms, in general, the platform itself doesn’t have any value. […] The platform has strong power, only if they have a huge userbase. Or some critical business [benefit] like payment, or billing. In that case, the platform has power. […]

Before we opened the platform, we just provided, I think only five games? Five to six social games. For millions of users. So they were playing a lot, for so few games.

I think just two years later, […] there was some trend to have an open platform. A lot of developers can produce games for the platform, so that the players have a lot of choices. And, in Japan, the other competitors opened platforms, and we saw, in a lot of the reports, [that a lot of developers] were going to join those platforms. We thought, we have a huge game, very popular game, users like it, but at the end of the day, you have to supply other games. We had six games, and the other competitor had a lot of games.

We wanted to diversify our portfolio to make the platform more attractive to players.

Are there any lessons that were learned in those early years of social gaming on GREE that are still important today?

I think that’s a really good question. I think in my company and also in this industry a lot of developers are struggling. I think one of the big reasons [is that] the market is growing so fast, and players’ expectations are getting higher and higher. All these changes so far: project size, number of people, the budget for one project is getting bigger and bigger and bigger.

So for example, I think it’s very similar what happened in the console industry. Whether it’s console games or social games, very early on you could develop one game by 4-5 people over 3-4 months. Disk space was limited, and the players’ expectations were not so high. But now, if you see the console industry, Call of Duty, those huge franchises, they use hundreds of millions of money per title, they take two years, three years to develop, but they can trust the players, that they will gross [huge sums of money].

But how to manage the project, and how to design those games, that approach, and how to manage it, the structure, mechanics, techniques, it’s totally different. So, in current day, I can leverage a lot of successful experience, how to incorporate social mechanics, or how to make games live that update every three days, every week, so that players can see something new every day, and also how to sell free-to-play consumables. Those kind of very fundamental mechanics or techniques, I think haven’t changed a lot. But how to manage a project, how to manage a team, how to manage a budget, that is totally different.

So, companies including us, [who have been here since] the early days in this industry, have to adapt, have to remodernise, or have to [learn] how to manage those big projects, to survive in this market.

Finally, what direction is GREE going into in the future?

Gaming is our main business currently. I mentioned at the beginning of the meeting that we started as social networking provider. We see ourselves as a more common, general internet tech company. So based on the industry, based on the trends, based on what people need, I think we will change ourselves.

Currently we have the games business, and now in the last six months we are trying to create something new, I mean, a non-game business. We already launched businesses in communications, commerce, mobile commerce, those sort of businesses. Still with those most of the revenue and profit comes from games. But we hope in several years that we will have two big businesses: one is games, and one is something we don’t know yet.

On the gaming side, there’s now the tablet platform and even TV. Now every platform is going to be a smart device, and we want to be a global #1 publisher and developer for both platforms. That way, we can provide our games to billions of players, from Wall Street to South Africa, or whatever, wherever in the world. That’s exciting. So we want to create games that can be played by billions of people, around the world.

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