What’s Cooking in the German Games Industry?

As a company with operations in four continents, we have our loyalties fairly distributed. Although, Germany is particularly important not only because it is home to our headquarters (of course, that makes it special) but also because it is the largest market in Europe. TechCrunch Europe reported earlier today that Facebook appears to have won the social network race here and now commands an overwhelming 64.4% of market. However, the picture of the German gaming industry as a whole extends beyond social networks.

Last Thursday, at Casual Connect Europe in Hamburg, an industry panel hosted by Berlin-based social games blogger Sebastian Sujka analyzed the current situation in Germany. The panel comprised gaming veterans and partners/friends of SponsorPay including Michael Kalkowski (GameDuell), Dirk Weyel (Frogster Interactive) and Henning Kosmack (Megazebra), so we were very interested to learn about their take on the German gaming landscape.

Panel at Casual Connect

Panel at Casual Connect with (from left) Michael Kalkowski from GameDuell, Dirk Weyel from Frogster and Henning Kosmack from Megazebra

“Germans are gamers by nature. When you walk into a bar, you see people playing cards or board games everywhere,” observed Kalkowski, who added that Germans were also pioneers in casual games with the famous Moorhuhn series that went viral in the early 2000s. Weyel predicted that soon distinctions between client-based, browser-based and social games would blur and we would simply talk about ‘online games’. The panelists acknowledged the importance of Facebook for the German social games market but noted that standalone browser games – which were “invented in Germany,” as Weyel pointed out – remain very popular, as do client games such as Metin2 or Frogster’s Runes of Magic.

In general, Germans are perceived as skeptical users who care a lot about data protection (Kosmack: “It’s in German DNA to be obsessed with data privacy”) and are thus very hard to win. In-your-face marketing and constant reminders repel users, which poses a problem, especially for US publishers. Instead, Germans trust their long-established information sources e.g. Frogster still attracts thousands of users by putting client DVDs in game magazines. “This wouldn’t work in any other country,” Weyel noted. However, once German users are won they turn out to be very loyal customers who are willing to pay for content. In terms of ARPPUs, Germans are reputed to only be outperformed by Austrians who incidentally seem to be extraordinarily big spenders.

Since Germans are traditionally late adapters, publishers should be careful to not jump to a new technology too early, Kalkowski advised. However, regarding mobile platforms, the panellists agreed that the critical mass has been reached and declaring 2011 the ‘year of mobile’ is by no means an overstatement.

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