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NewsTranscript
00:00 [MUSIC PLAYING]
00:03 [MUSIC PLAYING]
00:06 Paul, how are you today?
00:32 Doing great.
00:33 So exciting news.
00:34 Big stars in the news, lawsuits.
00:36 We have a little bit of everything.
00:37 Let's get started.
00:38 [MUSIC PLAYING]
00:41 [SPEAKING ARABIC]
00:45 So according to that news, ByteDance, the owner of TikTok,
00:54 now was considering selling gaming studio,
00:56 Monsoon, although it was acquired for $4 billion
00:59 in 2021.
01:01 But I think now TikTok owner looks
01:03 to streamline its operation and focus on core businesses
01:07 as well.
01:08 Yeah, it's interesting, right?
01:09 It could be that, like you said, ByteDance is just
01:11 seeing the growth of TikTok.
01:12 They want to focus more of their efforts and their resources
01:15 there.
01:15 And so they're looking to divest their gaming assets.
01:19 I suspect there's a little bit more
01:20 to the story than just that, than just a question of focus.
01:23 Because realistically, gaming is still
01:25 a growth engine for ByteDance.
01:27 Gaming is something they still understand.
01:29 But I suspect this is because Saudi Arabia is
01:32 looking at making acquisitions.
01:34 They know Saudi Arabia is looking to make acquisitions.
01:36 And more importantly, they know Saudi
01:38 is willing to pay a premium for game studio.
01:40 So I think they're expecting to get a really big number
01:43 for Moonton from Saudi Arabia.
01:45 We'll see how it plays out.
01:47 And now let's check another story.
01:49 [SPEAKING ARABIC]
01:52 [SPEAKING ARABIC]
02:06 So it's very interesting to see how Crew Esports announced
02:09 that Messi has joined to become the co-owner,
02:12 although the owner is also from the Argentine national team,
02:17 who's Sergio.
02:18 So now they're both players in esports.
02:21 And now they're both owners.
02:23 What are your thoughts?
02:24 Look, I love seeing new money coming
02:26 into the gaming and esports space.
02:28 That's always a good thing.
02:29 When you have Lionel Messi investing in esports,
02:32 that's a positive.
02:33 However, I will say I think a lot of sports stars
02:37 have been lured into investing into esports
02:40 because someone has convinced them
02:42 that sports and esports are exactly the same thing.
02:44 So if you understand the business of sports,
02:46 you understand the business of esports.
02:47 Do you agree?
02:48 No.
02:48 The reality is they're very, very different.
02:51 And I think the failure of Overwatch League
02:53 has proven that you can't treat esports
02:55 like traditional sports.
02:57 The things that work in sports don't necessarily
02:59 work in esports.
03:00 Now, I hope this ends up being a great investment for Messi.
03:03 And I applaud that he's willing to take this chance on esports.
03:07 I think it's a good thing for the industry.
03:09 But I would be a little concerned
03:11 that maybe he doesn't understand the esports space as fully
03:14 as he might think.
03:16 And now let's see Ubisoft and Amazon.
03:19 [SPEAKING ARABIC]
03:27 So Ubisoft, Bungie, Amazon have fired many employees
03:31 at the gaming industry.
03:33 And as the company continues to suffer,
03:35 why do they always end up with layoffs?
03:37 For example, let's take Amazon as an example.
03:40 The cuts are part of a bigger goal
03:43 to focus maybe on prime gaming.
03:44 What are your thoughts?
03:46 Yeah, look, I don't want to make too much of these layoffs.
03:48 Even though we're seeing it pretty consistently
03:51 across many, many game developers and many game
03:53 studios, I think part of the problem
03:56 is in 2021 and 2022, in the middle of COVID,
04:01 when gaming was booming like crazy,
04:03 booming even faster than it is now, a lot of studios
04:07 hired thinking that this boom would last forever.
04:10 And so they overhired.
04:11 Maybe they grew their teams a little bit too quickly.
04:14 And now this is more of a reset to normal,
04:16 where instead of the growth curve being exponential,
04:20 the growth curve is linear.
04:21 It's still going up and to the right.
04:23 But for Amazon, for example, do you
04:24 think their main focus now on prime gaming?
04:27 No question that I think that's going to be a focus for them.
04:30 But I think most of them just overhired during COVID
04:33 and are realizing to be profitable long term,
04:36 to be sustainable long term, they
04:38 have to right size their operation
04:39 and get to a number of employees and a number of developers
04:43 that can be sustained.
04:44 And now let's check Microsoft and Epic Games.
04:48 [SPEAKING ARABIC]
04:50 So according to that news, a lawsuit
05:01 was filed in US against Microsoft and Epic
05:04 Games for using algorithms and marketing methods
05:07 that lead to addiction.
05:09 It's very controversial, by the way.
05:11 Like we see the companies, of course,
05:13 if they want to boost their games,
05:15 they're going to use a clever marketing
05:16 strategy for their games.
05:18 And if people or gamers liked it,
05:22 shall we say it's their point or their problem
05:25 for their addiction?
05:26 What are your thoughts?
05:27 Look, there's no question that games and gamification
05:30 of anything leverage this loop of if you play,
05:34 we reward you with something that will then
05:36 make you want to play more.
05:38 But then why do we blame the company?
05:40 You're right.
05:41 So you could argue that that game loop which
05:43 rewards you to play more is addictive
05:46 or helps breed addiction.
05:48 But if we go down that path, then we
05:51 would have to assume that everything
05:53 can breed addiction, right?
05:54 Anything that has sugar could be addictive, right?
05:56 Because it has that same loop.
05:58 It tastes good.
05:59 It makes us feel good, so we want to eat more of it.
06:01 Should we start suing every chocolate company,
06:03 every candy company?
06:05 Exactly.
06:05 There has to be some personal responsibility here.
06:08 Anything good can become addictive.
06:10 Gaming, like Holi is very good.
06:13 Every study has proven it's very good for kids.
06:16 It helps improve test scores.
06:17 It helps them in school.
06:19 It's a net positive.
06:20 But if you take anything too far--
06:21 Everything needs control at the end of the day.
06:23 And parent supervision, right?
06:25 If there's a risk of addiction, if there's
06:26 a risk of doing it too much, the parents need to be involved.
06:29 And now let's continue our chat with our guest for today.
06:32 Let's do it.
06:33 [MUSIC PLAYING]
06:36 [MUSIC PLAYING]
06:39 [SPEAKING ARABIC]
06:49 Hello, Kevin, and welcome to Game Changers.
06:55 How are you?
06:56 Very good.
06:56 Thanks for having me.
06:57 First of all, let me ask you, which
06:59 are the most popular competitive games in the region?
07:02 And where are the majority of the players on your platform
07:05 come from?
07:07 So I think the majority of competitive games
07:09 in the region, it's similar to the international market.
07:12 You have Counter-Strike, Fortnite, League of Legends,
07:15 PUBG, et cetera.
07:17 On our platform, it differs slightly.
07:19 Our most popular game is FIFA or FC24.
07:22 And I think that's largely due to the format of our platform,
07:25 which is very much situated around 1v1 matchmaking,
07:28 so user versus user.
07:29 And obviously, FC24 is a great format for that.
07:33 In terms of the players on our platform, 75% of our user base
07:37 is UAE, Saudi, and Egypt.
07:41 Let's talk about Saudi Arabia.
07:42 Obviously, we know they recently bought
07:44 Face It for $500 million.
07:46 You could interpret this as being very bullish
07:49 on competitive matchmaking.
07:51 How do you see the region and the growth
07:54 in this sort of space coming from?
07:56 Where do you see that growth coming from?
07:59 I see it coming from a few places.
08:01 The first one has nothing to do with gaming
08:02 and is more with human psychology.
08:04 The world is moving to on-demand.
08:06 Everybody wants to do things now.
08:09 People want to watch a movie on Netflix.
08:12 They want to do it now.
08:13 They want to watch YouTube.
08:14 They want to do it now.
08:15 And with 1v1 matchmaking, it gives people the ability
08:19 not to wait around for this big tournament that's
08:21 going to happen every weekend or once a month
08:23 or however long the time frame may be.
08:25 But it gives people the ability to go and find
08:28 an opponent on-demand when they want to play.
08:31 I would say the second sort of factor
08:33 is esports in itself is growing.
08:37 And we look at amateur esports in particular.
08:40 Amateur esports is growing as well.
08:43 There's over 3 billion gamers in the world.
08:44 There's only 15% of that group of people
08:47 that are interested in the esports space.
08:49 But we see that number growing year on year on year.
08:51 And we kind of expect that to continue to do so.
08:54 And I think probably the third point, like you spoke
08:56 about Saudi's acquisition, if you look at what Saudi is doing
08:59 in the esports space, which has been very well documented
09:01 as well as AD Gaming as well as the recent announcement
09:03 from Dubai, I think the region is having a real push
09:07 to kind of grow the space from a competitive side, which
09:09 will naturally sort of trinkle down
09:11 into the amateur esports side.
09:13 Now let's talk about some of the regulatory environment
09:16 and the sensitivities.
09:17 Because with competitive matchmaking, in some cases,
09:20 you have players paying to compete in the tournament
09:23 to potentially win prize money.
09:25 How do you deal with some of the regulatory or sensitivities
09:29 around that, especially in this region?
09:31 Yeah.
09:31 We wanted to tackle it head on.
09:33 So we went and we did the correct moves
09:35 to get the right regulation for our business.
09:37 We also got a fatwa, Certificate of Sharia Compliance,
09:40 to ensure that the rewards that we're giving out to people
09:43 are acceptable.
09:45 I think with our platform in particular,
09:48 there's maybe a common misconception
09:49 that people are paying a fee to play in a match.
09:52 But people are actually paying a fee for a service.
09:55 So on our platform, you have the ability to play for free.
09:59 You can play users, win cash prizes for free.
10:02 If you want a premium service of being
10:04 matched with an opponent on demand, there is a fee for that.
10:07 That fee does not dictate the prize that you're awarded.
10:10 That is a fee for the service of playing on our platform.
10:13 And in addition to that, there's a lot of things
10:17 that we can and can't do on our platform.
10:18 So for example, there's a set prize fee.
10:20 We can't alter that.
10:22 The user can't choose the amount that they wish to pay
10:24 or something like that.
10:27 And lastly, the user can't choose who they play.
10:29 They are paying a fee for a service
10:31 of being matched with a random opponent of the same skill
10:33 level.
10:34 So Kevin, what kind of innovation
10:35 we will see in amateur esports?
10:37 And what can be done to ensure the competition is fair as
10:40 well?
10:41 So in terms of innovation in the space,
10:43 we're seeing a lot of companies come
10:45 into the region that are doing 1v1 on-demand matchmaking.
10:49 What that allows the ability to do is to match people fairly.
10:52 Because you're matching one individual user based
10:55 on their skill with another individual user based
10:56 on their skill.
10:57 And this opens up esports to the masses.
11:00 Because esports right now is reserved
11:02 for the competitive gaming elite.
11:05 And not everyone has the ability to play.
11:07 But you want it to be that whether you're
11:09 a good gamer, a bad gamer, or a great gamer,
11:12 you have the ability to find an opponent who
11:14 you can play against competitively
11:16 and stand a chance to win a prize.
11:17 Thank you so much, Kevin, for being with us here
11:19 in Game Changers.
11:20 Thank you very much.
11:23 [SPEAKING ARABIC]
11:25 [MUSIC PLAYING]
11:28 [SPEAKING ARABIC]
11:44 So there is a poll on Twitter.
11:51 It says, do you get concerned that more games are becoming
11:54 digital with no physical copy?
11:57 Around 68% said yes.
11:59 What are your thoughts?
12:00 I really am surprised at the results of this poll.
12:03 I don't know who these 62% are who really
12:05 like having a physical copy.
12:07 I think the convenience of a digital copy is huge, right?
12:10 Because now--
12:11 Technology are improving every day.
12:13 Not only that, it's easy.
12:14 You don't have to wait in line at the store to get a game
12:17 the day it's announced or the day it releases, right?
12:19 You can download it from the comfort of your couch.
12:22 You don't have to go wait in line in the cold
12:24 like you used to for the new "Call of Duty."
12:25 So digital is much more convenient.
12:27 Plus, you can take your games anywhere.
12:29 If you get a new console or a new PC,
12:31 you just download all your games again.
12:33 I think the only reason people like the physical copy
12:36 is they feel they own it.
12:37 Maybe they can sell it.
12:39 They can resell it after they're done.
12:40 Also, it has a different experience as well.
12:42 Yeah, there's a little bit of that.
12:44 I think it's nostalgia.
12:45 I think in reality, those 62% have rose-colored glasses
12:49 a little bit, remembering a nostalgic past.
12:52 And I think in reality, most of them probably
12:54 enjoy digital copies of games.
12:55 Paul, I really enjoyed this episode.
12:57 Do you have any last comments you would like to say?
13:00 No, I just want to say it's so cool to see guys like Messi
13:02 getting into gaming.
13:03 Anytime you have big stars like this
13:05 or people from other industries looking at gaming,
13:07 I think it's amazing.
13:08 That's very exciting.
13:10 [SPEAKING ARABIC]
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