Byte beat vs Tencent game depth comparison and Prospect From Founder Securities

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The following is the Byte beat vs Tencent game depth comparison and Prospect From Founder Securities recommended by recordtrend.com. And this article belongs to the classification: Brokerage Report.

I199it], reply to the keyword [byte skipping Tencent game depth comparison and prospect]

This in-depth report mainly solves the following problems: why should byte jump lay out the game, byte game layout strategy, byte game organizational structure and team configuration, byte leisure game business model, byte game category distribution, byte beat vs Tencent game comprehensive review and prospect (development track, category distribution, IP reserve, research and operation capability, and going out to sea), etc.

1. Why does byte skipping layout the game? ——Strategic consideration, maximizing the realization of flow and seizing the new opportunities of channel change.

(1) Game copyright limits the content source of byte jump live broadcast and video, and becomes the key factor to restrain the development of byte game live broadcast. According to Aurora data, the game copyrights of top 5 mobile game users who watch live games in 2019 are all from Tencent, including glory of the king (53.4%), survival of the Jedi (42.1%), League of Heroes (39.7%), crossing the line of fire (31.9%) and peace spirit (31.9%).

(2) The essence of mobile Internet cashing is the realization of traffic, among which the cashing efficiency is: Games > e-commerce > advertising. We estimate that the year-on-year growth rate of advertising in 2020-2021 will slow down to 40% / 23% respectively. Byte is in urgent need of finding new cash cows outside of advertising. Mobile Internet tiktok mainly includes advertising, electricity suppliers, games, etc. we use gross gross profit / cash volume to measure the liquidity of different realizable ways. In 2019, the cash flow efficiency of the voice, advertising, Jingdong and NetEase games were 98/233/362 yuan respectively.

We also assume the growth rate of Internet advertising and the market share of byte hopping in China in the next two years. If the growth rate of domestic Internet advertising market is 16% (18% in 19 years) and the market share of byte hopping advertising is increased to 32% (estimated to be 27% in 19 years), the advertising revenue of byte skipping in 2020 will be about 162.1 billion. If the compound growth rate of two years in 2021 is 14%, the market share of byte hopping advertising will be increased If it is increased to 35%, the advertising revenue of byte hopping will be about 19.7 billion yuan, with the increment of 46.1 billion yuan and 36.6 billion yuan respectively from 2020 to 2021, with a year-on-year growth rate of 39.7% / 22.6%, which is significantly slower than that in 2019 and before.

(3) With the migration of mobile Internet users and traffic, mobile game channels began to differentiate, and emerging content channels grew rapidly, providing dividends for the development of mobile games by byte jump of emerging traffic giants. China’s mobile game channel has experienced changes: tool based distribution channel + operator (2011-2013), hardware distribution channel (2014-2015), hard core alliance + Tencent (2016-2017), and content-based channel Competition intensifies (from 2018 to now), short video channels have risen rapidly, ranking top 2 among mobile game delivery media in 2019, second only to mobile phone tools. In addition, compared with hardware distribution and third-party channels, the user stickiness performance of vertical channels such as taptap is more prominent.

2. How do bytes lay out the game? ——The new king of leisure games, through acquisition + angle digging + self construction, has set up a game team of more than 1000 people, carries out multi category layout of heavy games, and aims to create a national blockbuster with high dau.

(1) Byte leaping game strategy: from channel to distribution to R & D, it will continue to March upstream of the game industry, and establish cognition through its own channels – light game accumulation portrait – heavy game harvest users.

(2) Organization structure of byte beat game business: in February 2020, the game department was officially established, and Yan Xun was responsible for medium and heavy games, and four studios were built by himself, including Beijing studio (former senior director of perfect world Wang kuiwu was responsible for / had been in charge of “magic land” and “Wulin waizhuan”), Hangzhou studio (part of the former Netease Pangu studio staff), and Shanghai studio (closed) The company purchased the former Sanqi mutual entertainment subsidiary, Shanghai Molun, Shenzhen studio (acquired Shanghe network, whose principal is natuo, the former Tencent mutual entertainment Qiankun game product manager), and took the morning and evening guangnian as the base, and acquired Shenzhen intelligent, etc. Zhang Lidong is responsible for leisure games, including the massive engine responsible for developing new games, ohayoo for positioning the distribution platform of leisure games, and youxiaobang (internal test) of positioning game community.

(3) Byte skipping has become the king of new leisure games distribution, mainly using the “free + advertising” business model, the head game 30 days ROI can reach more than 150%, the retention rate is more critical. Within one year, many proxy products have entered the top 10 free list of IOS games. During the Spring Festival, a number of its games broke out in a concentrated way, and they dominated the free list of IOS games. The performances of nAODONG master, kongfu special cattle and xiaomeidou landlord were outstanding. Byte skipping is a kind of leisure game which mainly adopts the “free + advertising” business model. Its ROI = LTV / CPI, in which the cost side CPI = CPM / (1000 * CTR * CVR), and the cash end LTV = LT * ARPU_ Dau = (1 + ∑ retention rate) imp * ECPM / 1000. We estimate that the ROI of the head game can reach more than 150% in 30 days. The retention rate is the key factor. The percentage of byte skipping in small games is 30% – 50%.

(4) Layout idea of byte beat medium and heavy game: concentrate strategic resources to create self-developed heavy game IP. Currently, the games under research may include leisure competitive game “battle girl Parkour” (version number has been obtained), competitive product “Jedi battlefield”, SLG / FPS product “pixel shooting” (under test), card product “journey of ABIS” (under test), MMORPG product “waste soil” In 2020, the revenue target of byte hopping non advertising games may be in the order of billions, but there are still many uncertainties in the future.

3. Byte beat vs Tencent game: both similar and different development track, there is still a big gap.

(1) Byte beat vs Tencent’s game development track: they all cut into the track with leisure games, and then adjusted their organizational structure and gradually expanded their heavy game agents and self-study. Tencent’s game history is inseparable from the user base and social traffic such as QQ and wechat. Byte has become the king of new traffic by virtue of “short-term frequency + information distribution”. Tencent entered the end game market in 2003, acting as the agent of South Korea MMORPG triumphant, but failed. Since then, Tencent launched QQ game platform and launched a large number of QQ series games, such as QQ hall, QQ sonic, QQ flying island, QQ dazzle dance, QQ flying car, etc. Since then, Tencent has restarted the road of agency, issuing and acting heavy games such as “crossing the line of fire”, “dungeons and Warriors” and “League of heroes”. In 2009, Tencent ranked first in the domestic game market.

In 2013, Tencent entered the mobile game market. Taking leisure games as the entry point, Tencent launched a number of leisure games such as “daily love elimination” and “everyday Parkour”, and began to try to expand various categories. In 15 years, Tencent launched MoBa mobile game “King’s glory”, relying on wechat and QQ user base and social precipitation, and quickly became a national blockbuster. Since then, Tencent has made a large-scale investment and M & A at home and abroad, and has been deeply bound with many head CP companies, ranking top 1 among Chinese game manufacturers. In 19 years, the market share of mobile games has been more than 50%. Byte officially launched the game business in 2019. It also takes leisure games as the entry point. With the advantage of “short video + information distribution” traffic, it has become the new king of leisure games in China in only one year. Since 2019, bytecomb has successively established medium and heavy game teams through acquisition, angle tapping and self construction, laying out multiple categories and aiming to create a national blockbuster of large dau.

(2) Byte skipping vs Tencent game categories: Tencent has a deep accumulation of games and a complete range of game categories. At first, it took leisure games as a breakthrough point, and then carried out subdivision category education, gradually cutting into RAC / SPG, act, SLG, RPG, FPS, MoBa, etc., and finally reaped users with high user base and formed large-scale revenue. As a new entrant, byte skipping is also the first to enter leisure games, and it only takes one year to become the king of new leisure games. In terms of medium and heavy game layout, it makes full use of the traffic advantage and cuts into the game types with higher LTV, such as SLG and MMORPG, in order to achieve higher ROI of buying volume.

(3) Byte skipping vs Tencent’s game research and operation capability:

① IP reserve: Tencent has obvious advantages, byte IP reserve is still in its early stage. It has announced two well-known IP mobile games products “sailing King’s hot blood route” and “All Star fight” with exclusive agent of China mobile game. Pirate king is one of the heaviest IP of China mobile game. The road to the strong of navigation King developed on this basis accounted for nearly 30% of the revenue of China mobile game in 2016.

② Game R & D talents and upstream CP: Tencent has been working hard for many years and has strong strength. It has established Tianmei studio, photon studio, Aurora Borealis studio and other studios internally. It has invested and acquired a large number of domestic and overseas CP, and has deep binding with many head CP, including Ubisoft, blue hole and riot Games, supercell, Shanda game, Xishanju, etc., byte jump has built a game team of more than 1000 people. At the same time, it maintains an open attitude and actively serves game developers. In the future, it is expected to establish contact with more high-quality game developers through cooperation, investment and acquisition.

③ Data analysis ability: under the trend of refined operation, the importance of data analysis ability in game distribution is more prominent. Tencent attaches great importance to data-driven, and has established IDA TA game big data products. Byte skipping uses algorithm distribution and player data analysis to drive game distribution and operation. It has shown high efficiency in game distribution and promotion business. Sunshine pig farm and brain hole master released by byte occupy the top 2 of IOS game free list for a long time from January to February 2020. However, the number of advertising materials for sunshine pig farm is as high as 46050, and the launch platform is relatively divided However, in the same period, only 164 pieces of materials were released from master nAODONG, with a single platform and form. However, the average daily download volume in recent 30 days was slightly higher than that of sunshine pig farm.

(4) Byte skipping vs Tencent game going abroad: Tencent has established a game brand overseas, but it lacks the advantages of social traffic with China. Byte skipping has become a pioneer in leisure games going out to sea. The successful overseas distribution of products such as brain hole master and my Kung Fu special cow also made byte jump enter the list of Chinese publishers’ overseas revenue for the first time in October 2019, and rose to 29th place in December. In 2019, tiktok has accumulated 738 million downloads. In 2019, the global total use time exceeded 68 billion hours, with a year-on-year increase of 210%. In 2019, the global download volume ranked fourth. Tiktok has entered the list of top 15 overseas game advertising platforms in 2020, and the potential for future game buying is huge.

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