Interview

'This is not a zero-sum game' says Kabam's Andrew Sheppard as the $325M outfit prepares for 2014

'This is not a zero-sum game' says Kabam's Andrew Sheppard as the $325M outfit prepares for 2014

As we stop to consider the trends of 2013, the talk will likely be of Supercell, King and GungHo.

One company often overlooked in this pantheon of success, however, is US/Chinese outfit Kabam.

Partly this is because it was early into the mobile free-to-play space.

For 2012, it released the world's top grossing app in the shape of Kingdoms of Camelot: Battle for the North; the standalone mobile version of its successful web strategy game.

Since then, it's launched movie tie-in The Hobbit: Kingdoms of Middle-earth; effectively a reskin of Kingdoms of Camelot but one which has generated almost $100 million revenue in 12 months.

It's a total that's only going to grow as the second film in the trilogy - The Desolation of Smaug - is released next week: something supported by a game update.

Fast & Furious 6: The Game is another Kabam movie licence which has been highly successful.

Behind the scenes

This relative lack of public profile isn't a problem for Andrew Sheppard, Kabam's president of studios, however.

"We have a degree of humility. We're more private than our scale would suggest," he says of the company which started four years ago above a dim sum restaurant, and expects to post revenues of $325 million in 2013.

One reason for this state is that Kabam's games to-date have been concentrated in the strategy genre, which because of their hardcore sensibilities tend to have a smaller and more male audience who monetise at a higher level individually than say a Candy Crush Saga.

Kabam's new mobile strategy title - Dark District

"We don't view Supercell. GungHo or King as competitors. We're not jealous of them. This is not a zero-sum game," Sheppard ponders.

But what is significant, he says, is how games such as Candy Crush Saga and Puzzle & Dragons have changed the market expectation in terms of how much revenue can be generated on a daily basis.

In 2012, a $100 million mobile franchise was big business. Now the top games could be generating $500 million in gross sales annually.

Fast shift

It's this sort of explosive growth that's seen Kabam transition very quickly from being a developer and publisher of web and Facebook games to one that's primarily mobile.

Sheppard says that for reasons of heritage and customer demand, it will always have a web gaming presence.

"30 percent of our revenue remains from web and Facebook and we have 100 people working on those games, but our considerable focus is now mobile," he says.

Yet many other companies who were strong in web gaming in 2012 have found the transition to mobile a challenging one - there are plenty of examples in China and Germany. And even moreso, switching between platforms while posting 80 percent annual growth is no easy task.


In this context, Kabam counts as one of the best example of being in the right place at right time with the right products.

Surfing the rise of mobile free-to-play, the rise of Android, and successfully hooking up games based on movie franchises - if we call it luck that's only because it's the simplest word to describe the situation.

Next year model

For Sheppard, Kabam's rise is a result of hard work and never resting on your laurels.

"Everyone has a superpower and in the case of Kabam's CEO Kevin Chou, it's recognising trends," he explains of the decision to go mobile. 

This resulted in the company setting up a new mobile-only development studio in Beijing. Starting with 60 staff, it's now 300-strong. 

And they've been busy. Kabam currently has 13 live games on iOS and Android, plus a strong release schedule for the end of 2013 and into 2014.

Kabam has the western rights for the mobile version of Chinese MMOG Wartune

These include Dark District, the first game from its San Francisco studio, which brings a sci-fi theme to the Clash of Clans genre.

It's looking to attract a more casual audience with Blast Zone, a multiplayer-focused action game inspired by Bomberman. Kabam will also go even more hardcore as it publishes the mobile version of complex Chinese MMOG Wartune in Europe and North America.

The road ahead

"Whether we're publishing or developing, we're looking for games that can be hits on a global scale," Sheppard says. "Otherwise it's an opportunity cost."

When it comes to Wartune, which is a standalone mobile version of the PC MMOG, and is developed by Chinese outfit Hoolai under licence from original developer 7th Road, Sheppard says part of the attraction is that it's not a title Kabam could have created internally.

And more generally, as Kabam scales up the number of games and the markets they support, its future success will boil down to how well it can manage the operational side of its business.

For that reason, it's been building up its European office with a 60-strong team based in Berlin.

"We pride ourselves on our service approach," Sheppard ends.

"We're not yet at the stage we would like to be at, but we've come a long way in four years."

Contributing Editor

A Pocket Gamer co-founder, Jon is Contributing Editor at PG.biz which means he acts like a slightly confused uncle who's forgotten where he's left his glasses. As well as letters and cameras, he likes imaginary numbers and legumes.

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