Rovio Entertainment recently has taken to playing the investor story manipulation game. A fun exercise undertaken by companies where they twist the truth through careful omission of certain facts. In this particular case the company has brought in more money than it did last year and its games are doing fantastic, but profits are down by 48.1%.
A lot of the money, according to The Gamer, was spent around the movie Angry Birds 2 that commercially failed. Generating a mere third of the original’s box office returns. This should not have been surprising to anyone. Where the original had a message to say with its charming and at times actually funny narrative the sequel veered right into woke territory with its Mary Sue female focus and degrading of its male characters into nothing more than bumbling idiots that the women needed to tolerate to save the day.
Simple put it wasn’t funny and failed to draw the attention of audiences. Owed no doubt in large part to it lacking a point to its narrative. Look at the advertising for the original movie and you know who the bad guys are, you get a sense of the plot, and a taste of the comedy. Compare that to the sequels where you do get a taste of the “lol men are bumbling idiots” comedy, have no idea who the villains are and less of an idea of the plot other than something, something, bad thing will happen, go heroes.
The secondary cause according to the report was “increased user acquisition to drive growth of new games”. In normal people speak what they’re saying is they’re having to spend more money and resource to acquire similar returns to previous iterations. Thus while the games are making more money they’re having to spend more money to get people to give them more money. This could be in part to blame on the diminishing interest in the Angry Birds brand or user burnout in games that are largely the same over previous iterations with minor alterations made to them. A risky line to walk keeping it familiar enough to retain the older audience, but new enough to keep them engaged and draw in more users.
Another deciding factor is the peaking of the mobile market in 2016 according to analysts. Where-as previously the market continuously grew as more users adopted the newer technology, now all those that are both interested and capable of adopting the technology have adopted it. Leaving the market with little room to expand and companies then competing for a determined share of market without significant growth.
In a Capitalist system this is fine and normal, but in a Keynesian Corporatist system, which many companies model their business on, this is bad. Especially as the industry is driven by money managers and professional corporate managers who have no vision as to how to expand and grow new markets to drive existing market purchases; as Ford did with the original Model T and instead aim to simply manage the slice of the market while preventing competition.
Whatever the direct cause of the loss of money they didn’t have to lose, the company has announced t will undergo restructuring of its Brand Licensing Unit, i.e., the people responsible for establishing legal arrangements to use the Angry Bird license and likeness will see layoffs and duty reorganization to optimize performance. Or in layman term they will no longer have 5 people doing what 1 person could do with hardly any additional effort.