Home » , , ,

Spice Labs Hits 10M App Downloads On Blackberry; On Ad Supported vs Free; Plans Apple, Android Apps


Share on Facebook0Tweet about this on TwitterShare on LinkedIn0Email this to someone

Spice Labs, the mobile applications venture from the Spice Group recently announced that its portfolio of mobile applications has reached 10 million downloads on the Blackberry platform. Spice Labs CEO Dr. Abhinav Mathur told MediaNama that the company has also reached 7 million downloads on the Nokia Ovi store; their applications are both paid and free, but (as expected) free applications account for around 90% of the downloads. Hangman remains the top application, but a few are catching up quickly, including BattlesUnlimited (Battleship), Memory is starting to kick in. Jigsaw and Snake are doing well. It’s the simple mass market games that are doing well. Extracts from our conversation:

MediaNama: You’re creating apps for popular, well known games, but what about creating original gameplay?
Dr. Mathur: We’re trying to give a better experience for the same game, ensuring that they’re available at multiple places, and we have a deeper engagement with the consumer, with daily updates, and word-packs. We are also looking at opportunities for creating IP. We are starting to discuss that internally, and creating a game framework for multiplayer gaming. The second thing that we’re doing is looking at whether we can become a catchnet for other game prodivers, and we can provide their games to our platform.

MediaNama: But application stores are geared towards supporting individual developers. Why would they work with you?
Dr. Mathur: Dr. Mathur: if focus is not on monetization, then they would go with independent approach. But more focused teams like ours can provide better monetization, allowing game developers to improve games, and help them. There is a significant overhead that one has to create – in terms of geographies and consumer behavior, monetization through ad networks and other means. But that’s still a longer term view that we have, just ensuring that we have more and more properties, and look at IP creation.

Advertisement

We’re focused on two segments – casual consumer applications which are mass market and global, and the other is enterprise applications, to focus on convenience and ubiquity, with authomation, productivity improvement, integration with ERP. We’ve identified the segment of casual games and games for kids, and are putting more muscle behind the kids segment, to provide learning, entertainment and the element of fun. We have seven applications for kids on Blackberry and Ovi.

MediaNama: In terms of advertising, which ad networks have you signed up with?
Dr. Mathur:With everyone – inneractive, Inmobi, millennium media and others. Our applications are delivering 130-140 million impressions monthly, despite being only on two platforms.

MediaNama: How much are the eCPM rates?
Dr. Mathur: I can’t disclose that

MediaNama: How have you gone about deciding the pricing your apps?
Dr. Mathur: We have SKU’s from between $2 to $3. Essentially, we’re benchmarking ourselves against what others are doing. We haven’t done a pricing strategy, given that we’re focusing on ads so far, but are going with what has been the trend.

MediaNama: So what’s bringing in the money – advertising or pay per download?
Dr. Mathur: Significant revenues are coming in from advertising so far, but we wanted to ensure that we had significant user base. Close to 90% of our apps revenues comes through advertising. The application economy is such that if you want to attract customers, you have to give free apps, and then you have in-app purchases or upgrades. There are just too many free applications available, if you’re looking to monetize through downloads.

Secondly, for the consumer to be able to consumer to comprehend the value, he has to use it, so you have to create the expectation for the consumer. Whatever he does, he has to use it. Once he has a free app, you can provide in-app purchases

MediaNama: Are you providing in-app purchases?
Dr. Mathur: We have in-app purchases – word packs in Hangman, which are slightly more difficult. For kids, we are providing a model where a kid can see certain pieces of the application, if he wants to buy. We are looking at a daily crossword, and more thematic puzzles with pictures

MediaNama: What about the Apple or Android platforms?
Dr. Mathur: We have not yet focused on them yet, because we found in Blackberry, a parter what was like minded, and there was some synergy there. We intend to take that experience on to iOS and Android, which should be out soon.

Share on Facebook0Tweet about this on TwitterShare on LinkedIn0Email this to someone
  • Nitin

    As per your article, 90% of the downloads being free which I presume will all have ad funded model built around them & also advertising constitutes 90% of revenue to them. Does this not suggest that Revenue/Download is same across Ad funded as well as PPD assuming these are the only two business models at their end? If the stats are true, I would say its a very promising business around Ad funded for them making $2-$3/download considering their PPD is priced in this range. Also if I dig deep, we can compute their revenues to be atleast $ 34 million only through OVI & Blackberry. I wish the business could have been as lucrative for others in the Indian Market.

    • Nikhil

      So the key number missing here is the eCPM, which can vary across applications and user profiles. the ad networks they have effectively work on a cost per click model, but the comparative metric is effective cost per milli (thousand) impressions. I don’t think your assumption of $34 million is realistic.

      Assumption – $34 million from mobile advertising
      impression – 130 million
      eCPM required to hit $34 million = $261.53

      Now assuming $4 eCPM ( http://www.quora.com/Where-do-I-find-average-eCPM-statistics-for-mobile-ad-networks-running-on-the-iphone-ipad-such-as-adMob ), the revenues wouldn’t be more than $520,000 per month.

      This also explains why the ad-free freemium model is the best.

      • Nitin

        Hi Nikhil,
        You are doing your calculations based on monthly impressions, which I don’t think is helping arrive to right conclusions. If you simply look at the statement, where they mention that 90% is free and rest is PPD. So out of 17million downloads, 1.7 million is PPD. Revenue through them basis USD 2-3 would come to USD 3.4 Million through PPD. Now looking at another statement, which says that 90% of their revenue is through Ad funded, so you can compute that to eqaute to USD 30.6 million, considering USD 3.4 million is constituting just 10% Revenue. Now if we do some back calculations regarding the kind of impressions needed to achieve this kind of revenue, the same will be huge and hence puts some doubt about the numbers thrown out here.

        • Nikhil

          hmm…makes sense. So something is amiss. I’ll write to them requesting a clarification. I think the 90% figure, in both cases, might have been an off-the-cuff remark, and not necessarily accurate. some might have said 99%, some might have said 99.99%. But we should check :) Thanks for this.

        • Nikhil

          hmm…makes sense. So something is amiss. I’ll write to them requesting a clarification. I think the 90% figure, in both cases, might have been an off-the-cuff remark, and not necessarily accurate. some might have said 99%, some might have said 99.99%. But we should check :) Thanks for this.

        • Nikhil

          hmm…makes sense. So something is amiss. I’ll write to them requesting a clarification. I think the 90% figure, in both cases, might have been an off-the-cuff remark, and not necessarily accurate. some might have said 99%, some might have said 99.99%. But we should check :) Thanks for this.

      • Anonymous