Rovio, the name synonymous with Angry Birds, has been under fire in the Finnish media.
In a country famous for its wintry melancholy it is unfortunate if not somewhat expected that recent news of layoffs within the company was met with such a barrage of negativity.
Even before Rovio announced it would be chopping 16 percent of its 800 strong workforce, there were articles lamenting how poorly the company had performed in comparison to neighbour Supercell.
Rovio’s 2013 revenue remained ‘flat’ while profits fell significantly, and it was this that was picked upon in the press, especially in Finland. But let’s look at these results in another way.
There is no denying the ridiculous success of both Supercell and Swedish based King, but Rovio’s $0.22 billion, or rather $220 million, is nothing to be sniffed at.
Its chart is remarkably similar to Mojang’s, whose hat wearing figurehead Notch recently cashed out to Microsoft for a cool $2.5 billion. The big difference is that while Mojang had just over 40 employees, Rovio had managed to employ over 800.
Those 800 jobs generate a significant benefit to the local economy, not just in purely financial terms, but in providing lives and careers for so many.
Even Supercell’s chief Ilkka Paananen says that companies that place revenue above fun will ultimately fail.
You might imagine this would be viewed as a very good thing indeed in an country so left leaning. Redistribution of wealth, high taxes and a relatively low difference between the highest and lowest earners in society are celebrated almost daily in Finland - so why in this case is it ignored in favour of the eye-popping ‘value per employee’ of leaner companies like Supercell?
Even Supercell’s infuriatingly humble barbarian chief Ilkka Paananen says that “companies that place revenue above fun will ultimately fail.”
Fun, while not something that can necessarily be measured is something that Rovio can confidently crow about.
Beyond its ‘right place, right time’ success with the original Angry Birds iPhone title, it has expanded into so many avenues and industries that if you can imagine it, an Angry Birds-related product probably exists.
In Finland there are Angry Birds playgrounds for children, there is a popular soft drinks line, fruit juice cartons, mugs, balloons, phone covers, headphones, HDMI leads, biscuits, donuts, cookbooks, comics, stickers and clothes.
There are no less than 12 Angry Birds-related games across numerous platforms, including the most recent spin-off Angry Birds Transformers, which has young children rabid with excitement far more than it has men-children sneering about it destroying the G1 legacy of Optimus Prime and his Autobot army.
Battle of the brands
There isn’t just an Angry Birds cartoon, there is an entire cartoon channel accessible through any of these games which works because people trust the brand.
This features all the in-house Angry Birds animation efforts (some of which are excellent by the way, check them out) plus hand picked titles that include the original Transformers series - grounding the next generation in that authentic 80s VHS vibe.
Amusingly perhaps, the pre-roll ad space on the Rovio channel seems to have been wolfed up hungrily by Supercell to advertise Clash of Clans.
While Nintendo has only just got in on the physical/digital world crossover toys with its Amiibo range, Rovio and Hasbro’s ‘Telepods’ have been snuck into parents’ baskets for the last two years.
The Angry Birds customer support team covers over a dozen languages and their social media presence - while perhaps down from its peak - generates tons of activity.
While the likes of King, as Zynga before them, has claimed that its incredible one off success with Candy Crush is definitely repeatable, (honest!) Rovio has spread its risk.
If in-game revenue dries up for King or Supercell tomorrow that’s the end of the company, but if that happens to Rovio, it will continue on and no doubt double down on its other revenue streams.
Be in no doubt, there are already children who have no idea Angry Birds was ever a game.
It is somewhat inevitable therefore that the breakneck expansion of the Rovio empire (I haven’t even mentioned its publishing arm or retro titles) would result in some failures. If it has made an obvious mistake it is perhaps that it hasn't failed fast enough.
Rovio's obvious mistake is perhaps that it hasn't failed fast enough.
As Finnish analyst Tero Kuittinen muses, “Companies who have attained rapid success also bask too easily in the light of their bubble,” and further chides, “No one in the Finnish gaming scene was comfortable talking about problems.
Rovio often directly rejected criticism”. This is the area that should have been picked up and picked on more, because of the parallels with the slow moving Nokia car crash.
Elsewhere in the press there are plenty of knives sharpened ready to cut into some delicious bird meat. Issie Lapowsky over at Wired proclaims “...they still made the fatal mistake of believing the Angry Birds brand would [last]” and “Over the years, we’ve seen one one-hit wonder get replaced by the next. Rovio is only the most recent example.”
In fact, Rovio is probably the best example there is of any company capitalising upon their IP so fast and so well and establishing roots that will enable it to weather this cold period.
Despite what King would have its shareholders believe, one hit wonders can’t be replicated at will. The only way that any company in this position can hope to achieve success again and again is to create an ecosystem in which brilliant new ideas and games can be nurtured internally until one of them turns out to be another beanstalk - and then capitalise on that, again.
Whether Rovio has managed to achieve such an atmosphere within its offices remains to be seen. The crucial thing for it is to do the opposite of what might be expected in a post-Nokia Finland - Rovio must avoid is becoming the next Nokia, a company who was once a world leader yet managed to ignore the presence of the iPhone for years, by which time it was too late.
As some of you will remember, King was an unremarkable if mildly successful games website for almost ten years until it broke through in 2013 with Candy Crush.
Like Brits, Finns do love to moan, but let’s hope that this mournful crowing doesn’t obscure the success of company that in 2014 is recognised worldwide yet in 2009 was nearly dead.