Candy Crush tempts investors with sweet success

SAN FRANCISCO – Candy Crush is out to tempt investors with the sweet taste of success while avoiding the sourness left in the mouths of those who bit into social game maker Zynga.

King Digital Entertainment, the developer behind the wildly addictive puzzle game, said this week that Candy Crush is seeking a listing on the New York Stock Exchange.

The news set the Internet abuzz with chatter from those crowing about the mobile game’s dizzying success and from the cynical hearkening back to the lackluster fate of Farmville maker Zynga.

Zynga pioneered online social gaming at a time when Facebook was center stage and got caught on its heels when players enthralled by free play on smartphones or tablets flitted away from the San Francisco-based company’s titles.

- Zynga took arrows -

“Zynga was a pioneer in its space,” said longtime game industry analyst Scott Steinberg, now general manager of Phoenix Online Studios.

“The trouble is, sometimes pioneers catch the arrows.”

Zynga was an early innovator, and is not out of the game, although its stock is about half the price it was when the company made its stock market debut at the end of 2011.

While no one can predict how long a game will be a hit, Candy Crush has shown staying power and King has the benefit of learning from Zynga’s woes.

“Like anything else that comes to market and trades on popularity instead of business fundamentals, you have to be aware that the two will collide and the guys on the popularity side are going to lose,” said independent analyst Rob Enderle of Enderle Group in Silicon Valley.

Candy Crush – King’s top-seller – started life as a Facebook game in 2012 but can also be played online and on smartphones.

- Candy shared -

The game is free, but players can pay for in-app extras to help them pass up through its more than 500 levels.

In a move that encourages players to spread the game, Candy Crush lets people call on friends or family at Facebook to download the title and help them advance.

In a promising note, Candy Crush has characteristics in common with classic title Tetris, which remains a star at nearly 30 years old.

Millions of commuters, teenagers  - even pensioners – clock in daily to test their skills at the game, which involves lining up tiny pieces of colored sweets to make them vanish from the screen of their computer or mobile phone.

King rolls out new features and doesn’t rest on laurels, according to analysts.

A constant peril for makers of mobile games, which are often free, is that players can be fickle in their loyalties.

“It is one thing to have a game that is a cultural phenomenon,” Steinberg said.

“It is another to have one with a user base that stay loyal year in and year out.”

Candy Crush has “struck a nerve” and King is using it as a springboard for other games, according to the analyst.

-          Mini-bubble fear –

Enderle warned that the buzz ahead of King’s initial public offering may signal a feeding frenzy that could put early investors on the thin wall of a “mini-bubble.”

The analyst was leary of mobile or social game companies overall, reasoning that popularity tended to be fleeting and their business models yet to be perfected.

“Zynga showed that you are as good as your last game,” Enderle said.

King Digital Entertainment said it has asked the US Securities and Exchange Commission regulatory body for clearance to list shares on the New York Stock Exchange under the ticker symbol KING.

King hopes to raise some $500 million, according to an estimate in its SEC filing.

Candy Crush records some 700 million sessions a day and racks up daily sales of $850,000, according to the IDATE digital research and consultancy firm.

It claims to have 324 million monthly unique users for 180 games in 14 languages, available through its King.com website but also on mobile platforms run by Apple, Google and Amazon, and on Facebook.

source: technology.inquirer.net

China may mean gold for Apple

SAN FRANCISCO—It could be a huge breakthrough for Apple to win a place in the line-up of China’s largest telecom provider and a big shakeup for the smartphone market.

A report in the Wall Street Journal said Apple had reached agreement with China Mobile to bring the iPhone to customers in a market dominated by low-cost Android smartphones.

The Journal quoted unnamed sources as saying that the two companies have inked an agreement to add iPhones to the colossal telecom firm’s roster of compatible devices later this month. China Mobile denied the report.

“Talks between China Mobile and Apple on cooperation are still going on and we currently do not have anything to announce,” the carrier’s spokeswoman Rainie Lei told AFP.

Yet such a deal would be a major coup for the US tech giant, which could gain a beachhead in the world’s most populous nation,

China Mobile had more than 750 million subscribers as of October, according to Cantor Fitzgerald Research, which estimated that 35 million to 45 million iPhones were on the network despite the lack of a deal between the companies.

The market tracking firm estimated that Apple could sell as many as 24 million iPhones on the China Mobile network next year if it were added to the network’s formal line-up.

Ben Thompson of tech new website Stratechery referred to Apple getting in synch with China Mobile “a very big deal.”

“Feel free to ignore anyone making snarky comments about China’s average monthly wage being the same as the price of an iPhone 5C,” Thompson wrote in a blog post.

He listed two pertinent facts about China for Apple as there being “tremendous income disparity” and “a ton of people” in a country with a population estimated at topping 1.3 billion.

“China consumers appear to us to have a deep admiration for Apple’s products,” Cantor Fitzgerald analyst Brian White said in a note to investors giving shares a “buy” rating.

“Apple now has the opportunity to tap into the largest carrier in the world,” he added, noting that China Mobile was just granted a license to upgrade to a new-generation network better suited for iPhones.

Apple chief Tim Cook has made China a priority for the company, and may travel there to take part in an announcement at a China Mobile conference later this month.

Industry tracker IDC forecast that smartphone sales in China will reach 360 million this year and, with the issuance of 4G network licenses and iPhones launched on China Mobile, top 450 million in 2014.

China Mobile has a unique 3G standard of its own that is not compatible with any existing iPhone models, although the Californian giant’s handsets can be used on other networks in China.

The Chinese government on Wednesday granted three operators, all state-owned, licenses to offer services on the faster and better quality 4G network, expected to usher in a new era of competition between mobile phone makers.

Apple will still have to compete with low-priced smartphones powered by Google’s free Android software, but the massive China market includes an abundance of people who have money to spend on iPhones, according to some analysts.

“It is difficult to displace Android’s dominant position in the Chinese market within a short period of time, but IDC predicts that its share in China’s mobile phone operating system market will reach the peak in 2013, and that the mobile phone vendors and telecom operators will adopt new operating systems with a more open attitude,” IDC China mobile phone market analyst James Yan said in a recent quarterly analysis.

IDC anticipated rapid growth of iPhone sales in China next year, but noted that budding mobile operating systems such Samsung’s Tizen and Firefox should “enable healthy competition.”

source: technology.inquirer.net