| Apr 25, 2012
By Justin W. Sanders
With intellectual properties under its belt such as "Deal or No Deal," "Extreme Makeover: Home Edition," "Wipeout" and of course, "Big Brother," Endemol is an undisputed powerhouse in the global independent television production industry.
As director of digital media at Endemol, Baba Uppal leads the charge of a dominant traditional TV production company's advance into the non-traditional, uncharted waters of new and cutting-edge platforms. His duties include licensing Endemol's IP to game creators and other digital developers, investing in new digital entertainment properties and nurturing relationships with second screen initiatives that have the potential to increase the company's TV interactivity.
In the wake of PromaxBDA's recent Game Marketing Summit, we thought we'd get Uppal's thoughts on the gamification of Endemol products and those ever-fickle digital revenue streams.
JUSTIN W. SANDERS: PromaxBDA just wrapped up our Game Marketing Summit, so naturally we're curious how gaming fits into your company’s digital strategy. Do you see social and online games licensed from Endemol’s shows as more of a revenue opportunity or a marketing opportunity? Or is it equal?
BABA UPPAL: Good question -- the goal for my group is revenue. So most initiatives out of my group will have to have a revenue stream attached, or the possibility of revenue for us to be interested. More promotional/marketing efforts generally are the responsibility of the networks who buy our shows. That said, if there's a really compelling promotional opportunity that we're really into, we might consider one on a one-off basis.
SANDERS: So if a game gets developed based on "Wipeout," for instance, your No. 1 goal is to profit off that game, as opposed to using it as a promotional tool?
UPPAL: Yes, a big brand like that we'll always look to exploit for ancillary revenue, and we are. We work with game developers/studios who bid on the rights and then we work with them to flush out creative, make sure it's on brand and they develop, market the games etc.
SANDERS: But surely promotion is a nice side benefit of such a product, yes? So when designing or commissioning or licensing an Endemol property out for profit, don’t you also have to consider how that ensuing product will promote the brand?
UPPAL: Yes of course. And when we do these deals we do them in concert with the network that's airing the show. So for "Wipeout," we work with ABC to identify the right partner and make sure the right elements of the show are being promoted through the game experience... the game should have new stunts that will air in the next season to coincide with timing of the new season launch, etc. So yes, we do consider promotion, and the fact that ABC, the network in the "Wipeout" example, is involved means that promotional considerations are always top of mind, but alongside revenue!!
SANDERS: Is there an effort on Endemol’s end to communicate some sort of quality control to the licensee so that the brand being gamified doesn’t get mistreated?
UPPAL: Big time. We have weekly calls with the developers/licensees to make sure they're on brand, not straying too far unless it makes sense, etc. We're very protective of the brand because it's being exploited globally and in a territory as important as the US. We can't afford to have big misses. Not all games work and make a ton of money, but they have to be supported properly.
SANDERS: And now for the question everyone's worried about (or at least should be): Besides selling units to traditional consoles, what are the revenue streams available to video or computer games nowadays? Or, to put it bluntly, how can video games make money nowadays?
UPPAL: Mobile gaming is a huge growing market right now. Social games were burgeoning over the past few years and people still make a lot of money in that category but Mobile is definitely charging forward. In both of these categories, the "freemium" model has prevailed. Basically the games are free to play, and somewhere between 3 to 5% of your total user base will spend real dollars in the game for one of a variety of reasons, [including to] speed up the game [and] buy exclusive items/virtual goods through in-app purchases (IAPs).
This is the dominant model on mobile these days. And with hundreds of thousands of apps in the app store, it's very very competitive, and very difficult for developers to put out games that cost even $.99. It [still] happens and [is] probably easier with a bigger brand but you're competing with so many free apps... makes it really tough. Also, running ads in your games can be a meaningful way to generate additional revenue for users who will never spend money in your game. Some combination of freemium and ads is how we're operating with our current projects these days.