16 May, 2011

Angry Birds!

Oh, what a game it is! ...and now they have an online version too!

Also, it's interesting to see how Rovio (the company that made Angry Birds) is expanding to build a diversified entertainment franchise spanning all media.

Some estimates put its total usage at 200 million minutes per day.

It is this staying power and loyalty that convinced Hed that Angry Birds can become the platform that makes Rovio, based just outside of Helsinki, Finland, into a global entertainment company.

“When we realized we had a big hit on our hands with Angry Birds, we looked at companies that had gone before us, especially in the mobile gaming sector where we were at that time very firmly,” Hed, CEO of Rovio told CNBC.com.

“We saw that most gaming companies had then immediately tried to make another hit game and we realized that had very rarely worked. Rather, we started to look at what we could do around Angry Birds and if there was a way that we could build this into an entertainment franchise,” he added.

Hed has aggressive expansion plans for Rovio, and said that the company will consider making acquisitions in the more traditional media space in order to advance its strategy.

At Wedbush Morgan, analyst Lou Kerner warns investors not to underestimate the value of social gaming, despite those who dismiss the soaring price tags as another dotcom-style bubble.

“Cityville got to 100 million users in seven weeks. That’s not possible in the world of video games. So you’re looking at much larger user bases at a much lower cost. Even though they might monetize at a lower rate they can still be massively valued companies like Zynga,” he added.

Many commentators even said that Facebook was overvalued at $1 billion, simply “because $1 billion is a big number,” Kerner said.

“The opportunity today I think is unparalleled in the history of gaming to build profitable companies of significant scale. That’s what’s under-appreciated broadly. When Zynga was trading at $1 billion, people said it was overvalued. It was overvalued at $2 billion and it was overvalued at $5 billion and overvalued at $8 billion. So why is it overvalued?”

Read more here.