Inside Social Games

As the Facebook Platform continues to grow around the world, experienced developers of free to play social games monetizing through virtual goods are increasingly attracted to build for the Facebook audience. Recently, we’ve been noticing increased interest from Chinese companies in the burgeoning virtual goods economy on Facebook. Today, we talk with the CEO of one leading Chinese social game developer who’s now investing heavily in the Facebook Platform.

Yong (Patrick) Liu is the CEO of Rekoo, one of the largest social game developers in China, with games like Sunshine Ranch and Animal Paradise running on social platforms like Xiaonei, 51.com, and more. Today, Sunshine Ranch and Animal Paradise are live on Facebook, with more games in the pipeline. We spoke with Liu about his vision for building games for the Facebook Platform and the differences between Facebook and popular social platforms in China.

[Inside Social Games] Thanks for taking the time to speak with us. Before we get into anything specific, could you tell us a little about Rekoo’s games and history?

[Patrick Liu] Rekoo is top social gaming company in China. We started in early 2008 with people from both social networking area and gaming industry. Our slogan is “和好友一起游戏”, in English, it means “play with friends”.

Currently we have two hit products in China, Sunshine Ranch and Animal Paradise. Sunshine Ranch is our flagship product with more than 7MM daily active users in China. We launched Sunshine Ranch in early June and Animal Paradise in the end of July on Facebook.

Before founding Rekoo.com in early 2008, I was co-founder and COO of eFriendsNet since November of 2003. eFriendsNet was the biggest Chinese SNS (social networking system) from 2004-2006, and the company was successfully acquired in January of 2006.

[ISG] Recently, we’ve been seeing increased interest in the Facebook Platform from international developers, Chinese developers in particular. Are you seeing many Chinese developers migrating over to Facebook?

[PL] So far we have not seem many Chinese developers moving to Facebook. However, many are preparing to do so. I believe that within the next 12 months, we will have quite a lot of Chinese developers publishing games on Facebook.

[ISG] Many Chinese social platforms have restrictions or barriers to entry compared to the openness of Facebook. Could you perhaps shed some light on some of these restrictions?

[PL] The competition in China is very fierce, which comes from (1) between SNS and developers; (2) SNS and SNS; (3) developers and developers. Some SNS don’t open their platforms at all, while some have limited open platforms for only “qualified” or strategically important products launched within the platform. The revenue share rate in China is typical 50-50. The government also prohibits some types of games such as mafia games or gambling games in SNS.

[ISG] Why did Rekoo decide to launch games on Facebook?

[PL] We are already in top position in China, which leaves us more efforts to eye on international market. Facebook is the #1 SNS in the world. I have personally paid lots of attention to Facebook since its beginning because of my first venture eFriendsNet, and I saw demands of applications over there, therefore Facebook becomes a very natural extension for us. In addition, we are also very excited to share our top quality product with the world.

[ISG] We want to touch on the two games brought over to Facebook for a moment: Sunshine Ranch and Animal Paradise. Both games have a farming element to them.  Suffice to say, this type of game has been exceedingly popular in China, and is growing significantly here in the United States. What is it about this type of game play that proves so appealing?

[PL] The “proper”, not heavy, interaction, which enables users to starts without any barrier and interact with friends without any thinking. One example is “stealing”, which is not ethic at all in real life, but becomes a friendly interaction among friends.

[ISG] How did the original concept come about for Rekoo?

[PL] Again, our slogan is “play with friends”. If you recollect the most interesting games you’ve played, it must be those you play with friends during childhood or in spare time. So we try our best to think which games we’ve played with friends before, and which are most interesting. In addition, we also check the most popular games in China to see whether we can play with friends or whether playing with friends makes it more fun.

[ISG] What has been the biggest difference for you between developing for a Chinese and western market?

[PL] In China, social networking and social gaming are still in early stages, not to even mention that the market is only quasi-open to some extent, therefore we’ve done a lot in social gaming to educate the users and sometimes the social networking companies. However, the western market is more mature and systematic, and the business model is more clear too.

[ISG] How different are art styles between your games in China and western markets?

[PL] To tell you the truth, we’ve changed a lot. As a user by heart, I’ve used and am still using lots of western products and Chinese products. I found the art style differs a lot, and some art style is not acceptable in China at all. So we’ve continuously changing our style according to user feedback.

[ISG] At the moment, Sunshine Ranch is sitting around 1.2 million monthly users on Facebook. How does this compare to the Chinese platforms it is currently available on?

[PL] In China, Sunshine Ranch has 7 million daily active users, which is far bigger than Facebook. Happy Farm is comparable to Sunshine Ranch in the Chinese market, while Sunshine Ranch is more popular in most platforms.

[ISG] What sort of expectations do you have for Animal Paradise?

[PL] The dream to own a small forest kingdom since childhood is the origin of designing Animal Paradise. We have very high expectation on Animal Paradise, particularly in western market, which we believe Animal Paradise will be more popular. In fact, we’ve already demonstrated it in the Russian market.

[ISG] Is it safe to assume your monetization model for these games is virtual goods/currency sales?

[PL] Yes.

[ISG] How does monetization on Facebook compare to monetization on Rekoo’s other top platforms?

[PL] It is much higher.

[ISG] The virtual goods market in China is significantly more mature than in the United States. How do you see the evolution panning out for the western markets?

[PL] I am sure within the next 3 years, the virtual goods model will counts for 50% of total gaming industry in western market.

[ISG] Before we finish up, do you have any other game titles we can expect to see come over to Facebook in the near future?

[PL] We have two games in developing now and we will publish both games in China and Facebook.

[ISG] Thanks once again for taking the time to speak with us. Is there anything else that you would like to share with the readers?

[PL] Since gaming industry is a huge industry in China and counts for 70% of revenue for China Internet, and since virtual goods model is more popular in Chinese gaming industry, Chinese developers understand virtual goods and microtransaction model better than western peers. So we believe that Chinese developers can contribute a lot to the evolution of social gaming worldwide. Rekoo has specialized team to design game and specialized person to design gaming balance, which will make a game more fun, longer life cycle and higher ARPU.