Interview with Sean Vanderdasson, WildTangent

Founded in 1999, industry veteran WildTangent and seen and done it all in casual games. Its latest incarnation, however, is perhaps its most revolutionary. WildTangent’s platform is bundled with most PCs sold in North America and its WildGames network attracts 1.5 million users monthly. Its patent-pending Wild Coins platform allows players to play for free, rent to own, and purchase casual games and enables advertisers to sponsor free game sessions seemingly.

We spoke with Sean Vanderdasson, WildTangent’s VP of Marketing, about the company’s wild past, Wild coins, and the wild changes that are taking place in the casual games industry.

WildTangent has gone through huge changes since its launch in 1999.  How has the casual and online games space changed and how has WildTangent evolved with it? 

When we launched in 1998, we were essentially an advergame company. We were very successful and it was a good business, but not really a scalable one. We recognized that and began a transition to where we are today. That transition was accelerated when the dot com bubble burst and the advertising budgets for advergames dried up completely. The launch of WildCoins in 2007 marked the end of that transition and the beginning of a very exciting time at WildTangent.

How does WildTangent’s offering differ from other casual game services?  What are WildCoins and how do they work? 

Well, let’s address one thing first: WildTangent’s offering is not just for casual games.  It is, however, the best offering in the market (for both game players and game developers), and works on all types and values of content, from sub-$1 digital items to $60 core games.

Okay, let me explain in more detail. First, we have a patented three-pronged business model that provides game players incredible choice. The three are: 1) FREE: You can play for free by watching a brief 15-30-second video advertisement while your game is loading (not inside the game);

2) RENTAL: You can play additional game sessions (beyond the free sessions games come with) for as little as $0.25 using our digital currency, WildCoins.  If you purchase WildCoins via our monthly program called WildClub, you may also use your WildCoins to purchase games.  Oh, and just for clarity, in either situation, every WildCoin you spend on a game via sessions also applies toward ownership; or

3) PURCHASE: You can purchase a game via the traditional method of credit card, PayPal, etc. 

Second, we focus on all gamers, not just hidden object or 3-across match players.  We know that game players can have varied interests.  As a result, our catalog is deep, yet broad in breadth and expanding very quickly.  However, the three-pronged offering described above applies to all these games. Rather than spend $20, $40, $60 to purchase a game, you can use 1, 3, 5 WildCoins to play a game session whenever you want, or even better, an advertiser might pay the game session price for you.  

Now as I had mentioned above, the game developer wins big too.  Rather than suffering from a pitiful 1-4% conversion rate or a steeply discounted game price, they now earn money from 100% of the people who want to play their game (it doesn’t matter whether they are renters, buyers, or simply have no means to pay). In additional, we’ve found that the lifecycle of a game can now be years of strong, consistent revenue rather than a month or so thru the traditional launch-n-pray model.  It’s the perfect alignment of interests between the game developer and game player…It truly is revolutionary.

WildTangent is a leading proponent of the ad model for casual games.  How has the recession impacted the ads business for casual games?  Are casual games recession-proof? 

Are casual games recession-proof? I don’t think it’s an issue of whether or not the games are recession proof. It’s whether the business models are.

Most of us have read that sales of $60 console games have decreased. No surprise there – it was inevitable and merely accelerated by the recession.  We’ve also heard about the collapse of some of the in-game advertising companies.  And it now appears that several of the flawed subscription-centric models in the casual space are failing as well, as evidenced by some recent price drops, decreases in reported revenues, and changes to their business models. 

As for us, the opposite is occurring.  We’re growing faster than ever before. Our Q1 ad sales grew by more than 60% over Q1 2008.  WildClub has grown over 900% since November with no signs of slowing down, and we’re selling more games now as well.

To give you further evidence, we’ve recently had some game companies ask us if they can replace their current business model with ours.  If it makes sense, I’m sure we will.  In the meantime, we’re also asking our other partners if they too would be interested if we offered such service. 

Prices for casual game downloads have dropped significantly in the past year across multiple web sites. Amazon.com is selling all games at $9.95 or lower and Big Fish Games just announced that all games are $6.99 for all Club members.  What do you think the impact of lower prices will be on the casual games download space?  How does this impact WildTangent’s model? 

Let me answer that from two viewpoints: WildTangent and the Industry.

For WildTangent, well, we’ve seen a nice increase in WildClub ever since they did that.  So, maybe people are leaving them who previously felt trapped…I don’t know.  I do find it interesting though that they changed their model so abruptly when they had been claiming such incredible growth up to that point.  I mean, from what I’ve heard, they didn’t even give a head’s up to their game developer ‘partners’ that they were doing this.

Now, from an industry standpoint, lowering prices for ownership might seem great for consumers, but it’s not. As a developer, if the result is simply less revenue from lower prices along with lower game sales volume, then you’ll likely look to other platforms to build games, or build less expensive games for the PC so that you can still survive. 

Trouble is, the PC remains the largest game platform in the world by an enormous margin… Don’t believe me?  Well, take 5 minutes and do the research yourself.  All I’m saying is don’t stick your head in the sand… abandoning the PC really isn’t a wise option.  Instead, requiring a more robust business model (like WildTangent’s three-pronged model) anywhere you distribute your game seems the better play over the long haul.  That way, you still win and grow regardless of a consumer’s ability to pay. 

Just to be clear.  I do not take this lightly in any way. I know this decision requires internal fortitude.  It affects people’s lives, their companies, and ultimately what they are passionate about.  You just have to ask the question: "Will I be better off six months from now by accepting what BigFish and Amazon have done or is it better to take a stand now, ween myself from them, and only distribute my content where I can maximize it’s value?" 

WildTangent used to develop its own games but closed its studio last year.  Why does WildTangent no longer create its own games? 

I’m sure it would be great if there was a juicy answer here, but there isn’t. Instead, it was just a very difficult decision.  In a nutshell, over the past few years it became less and less important for us to create games because so many other developers were creating high-quality games.  In fact, we work with over 140 developers around the world today. So, late last year we made the decision to close the studios and simply focus on publishing the great games made by others.  Will we ever have a studio again?  Well, there are no plans to, but as usual, never say never.

WildTangent most recently announced a partnership with Mochi Media.  Can you tell us more about this partnership? 

As you know, Mochi Media has developed a world class advertising platform that has been adopted by thousands of Flash game developers. What Mochi didn’t have was a dedicated and experienced ad sales team to sell the increasing amount of premium ad inventory they were creating.

Selling premium ad inventory is something we do very, very well so we have essentially become their exclusive ad sales force in North America which means advertisers we work with have an even broader and deeper reach to the Flash gamer and the developers using the Mochi platform have greater opportunities to monetize their IP. I should also add that my adding Mochi to our audience numbers, we have become the largest gaming vertical ad network in North America surpassing EA and Yahoo.

What kind of gamers will WildTangent’s games appeal to?

The beauty of our offering and three-pronged business model is that we can and do offer top games for everyone’s interests, regardless of price.  So, whether it is a $60 core, $20 casual, or free kid’s game, we can publish it for our customers AND make money for our developers.  We liken it to "iTunes for Games", and it pretty much is.  But just wait.  We have A LOT more we’ll be doing this year…A LOT. 

What are your favorite games you are playing right now on your site? 

Our own game FATE: Undiscovered Realms continues to be a favorite. It, along with FATE have been in our Top 10 ever since each were released…They are very addictive.  Plants vs Zombies is a very fun tower defense style game that just came out that I’ve been playing far too much. Curse you, PopCap! 😉

What is your prediction for WildTangent in the next 5 years? 

Just a second, let me get my Conan O’Brien big hair for this Year 2000 segment.  Okay…In five years you will see WildCoins and our Sponsored Sessions offering widely adopted in the games industry (and beyond???)…Well, it may actually take far less than 5 years.  What I mean is that games will be the differentiator in any network or site, but the underlying three-pronged business model will be the same. 

When you think about it, this would make developing great games easier since wherever you distribute a title, you’ll get advertising, rental and ownership revenues…100% of the audience monetized and consumers with the freedom to pay exactly what they value a game at and consuming it how they want.  Again, a perfect alignment of interests.

What about the industry overall? Looking into a crystal ball, what do you think casual games will look like 5 years from now?  

We’re in an interesting time right now, especially for such a young industry as casual games.  There are some very pressing decisions that developers need to make and time is the greatest enemy, but the industry shows great promise.  Maybe I’m naïve though.  I still believe aligning everyone’s interests, working hard and building a great product/service is a better strategy than praying things will turn out okay or chasing the latest shiny new object.

If there was one 5 year crystal ball vision I have though, it is cross platform game play.  For example, imagine playing against someone on a handheld device while you play on your IPTV or PC.  Or picking up where you left off at, um, work, on any device when you got home, while riding the bus, etc.  Now, imagine that as the norm as opposed to merely a few online games.

Does WildTangent have any plans to expand beyond the PC platform (e.g., iPhone, consoles?)

Yes.  Will I tell you what they are?…No…You didn’t buy enough drinks.

Any last words for your fans?

Personally, I would just like to thank everyone who has supported WildTangent.  We’ve certainly reinvented ourselves a few times over the years and arguably have rarely, if ever, taken the easy road. 

The result, however, is that today WildTangent has an amazingly successful and revolutionary business model that tens of millions of consumers (each with different interests and abilities to pay) and developers (of all types of content) both now fully enjoy.

So, "Thank You!"… oh, and please tell your friends!

Joel Brodie