Gamescom Latam<\/a> in a talk entitled, \u201cThe Mobile Frontier: Big Trends and Smarter Moves for 2025.\u201d<\/p>\n\n\n\nWe covered a lot of ground in our fireside chat at Gamescom Latam in Sao Paulo, Brazil. We hit topics like Apple\u2019s move to emphasize user privacy over targeted ads as it deprecated the Identifier for Advertises (IDFA). We also covered the antitrust ruling that could bust the floodgates open when it comes to developers being able to advertise their own web shops (where they can charge lower prices and don\u2019t have to pay a 30% commission to Apple and Google) inside their mobile games on the Apple and Google app stores. We explored the consequences if game developers are also able to use their own payment systems \u2014 which take around 3% commissions rather than 30% \u2014 in mobile game transactions.<\/p>\n\n\n\n
Sandsoft is focused on taking advantage of these trends by focusing on midcore gamers, which is becoming a bigger part of the overall mobile games market. And Sandsoft is also busy working on AI tools that can help developers work more efficiently.<\/p>\n\n\n\n
And we looked at other opportunities for mobile to grow as the mobile-first generation grows up and becomes a bigger part of the population of gamers. We also assessed when it\u2019s the right time for local talent to take on local stories and spread them to the global stage with authentic triple-A development.<\/p>\n\n\n\n
Here\u2019s an edited transcript of our on-stage interview.<\/p>\n\n\n\nSandsoft CEO David Fernandez Remesal<\/figcaption><\/figure>\n\n\n\nGamesBeat: I\u2019m here with David Fernandez Remesal, the CEO of Sandsoft. I\u2019ll have him introduce himself, his career in games, and the origins of Sandsoft.<\/strong><\/p>\n\n\n\nDavid Fernandez Remesal: <\/strong>I\u2019m pleased to be in Brazil. It\u2019s my first time. I\u2019d like to thank everyone here. You\u2019re doing an incredible show. I\u2019m kind of what I could call mobile native when it comes to game development. I started my career working on mobile games almost 20 years ago. Those of you that were around, that means before smartphone games. I worked at a company called THQ that you may remember. They were one of the pioneers, as a triple-A games company, in doing mobile games as well. I started my career at THQ Juarez, their mobile game division.<\/p>\n\n\n\nAfter that I had the privilege of working with two industry titans at a company called Digital Chocolate. That was Trip Hawkins, the founder of Electronic Arts, and Ilkka Paananen, who happens to be the CEO and founder of Supercell as well. I spent part of my career working on an app store with Nokia. I also worked on the N-Gage handheld device. In that particular case I made the wrong choice. I went for the loser in the smartphone era. But eventually I learned quite a bit about how you need merchandise, games, and apps on an e-commerce platform.<\/p>\n\n\n\n
After doing something in the mobile advertising space, I also had the honor of joining King, where I worked for almost five years on a couple of franchises. One was Bubble Witch Saga, and then Candy Crush Saga. I was at the King London studio when I left to run Sandsoft five years ago.<\/p>\n\n\n\n
GamesBeat: Sandsoft is interesting to this market in part because you\u2019re also in an emerging market, albeit a very different part of the world. The company is headquartered in Saudi Arabia. Can you talk about how that happened to come about?<\/strong><\/p>\n\n\n\nFernandez Remesal:<\/strong> We\u2019re slightly earlier in terms of the game industry in Saudi compared to what we see here in Brazil, particularly toward game development capabilities. But we have a nice consumer market. It\u2019s not as big as Brazil. But let me get started with how Sandsoft was created. For those of you who are not familiar with Saudi Arabia, they have a plan called Saudi Vision 2030. The main proposal is to diversify the economy away from oil and gas. As part of that program, they\u2019re trying to build what we call a knowledge economy. Gaming is a pivotal part of that transition.<\/p>\n\n\n\nWe\u2019re part of a large Saudi corporation that was founded to support that plan. They decided to diversify their group. Gaming was one of the things they wanted to do. Sandsoft was born in 2019, originally as an esports company. The first thing we did as a company was the PUBG Mobile event in Saudi Arabia. But [we] realized esports was not a business. It was maybe more of a show, rather than proper commercial ongoing activities you can run in a sustainable way. They decided to venture into mobile game development and publishing, which is what we do today. We\u2019re developing games in our own studios, and we\u2019re a global games publisher. We\u2019re supporting game development studios in the mobile space to commercialize their games.Iza\u2019s Supermarket<\/figcaption><\/figure>\n\n\n\nGamesBeat: What are you working on? What is your focus? How big is the team, and where are they?<\/strong><\/p>\n\n\n\nFernandez Remesal<\/strong>: We now have roughly 100 people. We\u2019re split into four different markets. We have people in Saudi Arabia, where we\u2019re headquartered. We also host a game development studio there. We have satellite offices in Spain, where we also have a development studio. Then we have a couple of publishing operations in China and Finland. We also have a small studio in France. That\u2019s where we have our operations.<\/p>\n\n\n\nIn terms of focus, as I mentioned to you, we\u2019re focused on mobile platforms. We have a few games with aspirations to become cross-platform, but we\u2019re mobile first.<\/p>\n\n\n\n
GamesBeat: You moved to Saudi Arabia. Can you talk about what that was like for you?<\/strong><\/p>\n\n\n\nFernandez Remesal<\/strong>: Yes, I did. I\u2019ve been there for four years now. The weather aside \u2013 the summer is really hot \u2013 it was a big cultural change for a European to come over to a country that was maybe more conservative, that was more closed than other countries I\u2019ve lived in. But I felt that if you are respectful, if you try to understand the things that are changing, and if you adapt to the pace of change, it\u2019s quite livable.<\/p>\n\n\n\nThe people are very passionate about games specifically. There\u2019s a young, savvy population. They consider themselves gamers. When you tell them you work in games, they respect you. It\u2019s different from other countries, where people think you play games all day. They don\u2019t realize that this is an art form, that this is something that goes beyond just play.<\/p>\n\n\n\n
GamesBeat: A reminder that it\u2019s a global industry. Gaming is not what it used to be. It used to be from Japan, the U.S., and Europe. Now it\u2019s a very different world.<\/strong><\/p>\n\n\n\nFernandez Remesal<\/strong>: Correct. It\u2019s becoming very global. Like we see here. It\u2019s not just about all the people attending to play games, but also all the game companies showcasing their games, which is really exciting.<\/p>\n\n\n\nGamesBeat: How far along are your games?<\/strong><\/p>\n\n\n\nFernandez Remesal<\/strong>: In terms of our game development studios, we\u2019re just starting our first prototypes. Both studios started in 2023, but it took us some time to get the initial core teams that we could trust to develop their game ideas into commercially viable games. We have been in a kind of boot camp at both the studios for a year. Now they\u2019re starting to prototype what we can see as more commercial games.<\/p>\n\n\n\nAs a publisher we have a few games already in the market. Maybe the first we released was in partnership with Jam City, DC Heroes and Villains. We\u2019re also raising a few other games that\u2013mobile free-to-play games, you don\u2019t have a red button where you hit it and the game is live. It\u2019s more about ongoing progress. You\u2019re keeping them in development and improving the games. Then you try to find ways to scale. In this case through user acquisition. In that sense we\u2019ve had games available in the market for more than three years. We have six games in our portfolio. Two of them are more mature. We expect to scale them in the first half of the year.<\/p>\n\n\n\n
GamesBeat: Let\u2019s get into some of the trends in the mobile industry. What do you see? What matters to you? What is important to pay attention to in mobile?<\/strong><\/p>\n\n\n\nFernandez Remesal<\/strong>: Let me start with something that is in many cases not looked into enough. We\u2019re seeing a change in the audience itself. We need to acknowledge that Generation Z is coming in. They bring a completely new way of consuming content. They\u2019re less attracted to deep, engaging experiences. If I could call them, in a way, the digital generation, they\u2019re focused on short-term or short-form entertainment, where they can get their dopamine and adrenaline and then engage further. They\u2019re a generation that doesn\u2019t pay a lot of attention until they get really hooked on the things they\u2019re doing.<\/p>\n\n\n\nFrom that perspective, we see a shift in consumer behavior. We see different session lengths, different ways of engaging with games. The industry is growing by double digits in regions like South America and the Middle East and southeast Asia, while the more western markets aren\u2019t growing as much. That\u2019s linked to the average age in these regions. They have much younger populations in these emerging markets, where they consume games as a native entertainment form. There\u2019s a new consumer coming in from Generation Z, bringing new consumption patterns in their session habits and rates of play. At the same time, there\u2019s an opportunity to propose different kinds of content.<\/p>\n\n\n\nEpic Games is still tangling with Google and Apple on antitrust.<\/figcaption><\/figure>\n\n\n\nGamesBeat: One of the interesting trends that\u2019s emerged in mobile is the importance of the relationship between developers and platforms. We saw Apple\u2019s decision a few years ago to prioritize user privacy over targeted advertising. It made targeted advertising much harder. Game companies lost the ability to very precisely target people who favored certain kinds of games. They had to go back to more of a guessing game around how to zero in on which users they wanted to target.<\/strong><\/p>\n\n\n\nThis had an impact over years. Do you think we\u2019ve learned how to deal with this change in the market and still be able to find the users that you need?<\/strong><\/p>\n\n\n\nFernandez Remesal<\/strong>: IDFA is not going to go away. Privacy is going to be with us. It\u2019s going to be something that everyone has to pay attention to. That\u2019s been critical in the mobile space, because of the merchandising problems we see in the app stores. We see a lot of problems in content discoverability. That means most of the growth we\u2019ve seen in these games has been through performance marketing user acquisition.<\/p>\n\n\n\nOne thing that we\u2019re seeing more and more is game developers trying to build communities everywhere. Trying to expose their games. Trying to create communities through influencers, through Discord and content creation. But eventually IDFA is here to stay.<\/p>\n\n\n\n
GamesBeat: Speaking of the developer-platform relationship, we\u2019ve had an antitrust case going on for a long time, four and a half years now, between Epic Games and Apple. Yesterday we got a ruling from the judge that held Apple in contempt of court. This has a lot of significance for whether or not mobile game companies can go outside of Apple\u2019s store and advertise lower prices on their web shops or other sites. They can sell the same things at lower prices than the app store because Apple takes a 30% cut.<\/strong><\/p>\n\n\n\nApple appealed this and had been able to dodge the effects of it, even in Europe, where they had a 27% core technology fee they introduced. Now the judge has said, \u201cNo more of that. You can\u2019t evade this ruling anymore. You have to allow game companies to tell their users that there are lower prices elsewhere.\u201d This is a fundamental antitrust protection for consumers. The ruling should affect the whole industry. What\u2019s your view?<\/strong><\/p>\n\n\n\nFernandez Remesal<\/strong>: We were talking last week, early this week. Eventually, we\u2019ll see some form of platform disruption, especially when you look at mobile platforms. Mobile has been mostly governed by two platform companies, Google and Apple. There have been other app stores in the Android ecosystem, but in the end there are few opportunities for you to get content, and particularly games, on your mobile device. That\u2019s a situation set for disruption.<\/p>\n\n\n\nEventually, particularly in countries that are more protective toward consumers\u2013they\u2019re upset about these oligopolies. They\u2019d like to offer consumers more opportunities to discover content and do so in a way that\u2019s fair for both consumers and game developers. The Digital Markets Act, in the United Kingdom, was one of the first changes we saw trying to open the mobile gaming ecosystem a bit more, trying to ensure that developers have some choice and consumers have some choice. But as you mentioned, that was a segue way for Apple to introduce a new tax, a new fee for game developers if they wanted to go that route.<\/p>\n\n\n\n
What we saw a few hours ago\u2013it looks really recent. But game developers now have the opportunity to have a direct relationship with consumers. They can build that relationship in a way where they can offer consumers more alternatives and choices. First of all, price points. You can offer different price points compared to what\u2019s available in the app stores. For those of you who are game developers, in the app stores you cannot select any price point you want. They\u2019re fixed. They have ranges you can pick from, but you can\u2019t just select any price point at all.<\/p>\n\n\n\n
The second factor, as you mentioned, is discounts. Trying to ensure that if you\u2019re proposing this direct to consumer offering, you can adjust your margins and provide more value to consumers. Eventually that ensures that you as a game developer can get a broader part of the value share you\u2019re creating with the consumer, but at the same time give some back as well to the consumer in a way where they can pay less when they\u2019re using a web shop.<\/p>\n\n\n\n
The thing that we\u2019ll hopefully start to see soon is that it\u2019s not just about you informing consumers that they can have other ways to consume your content and buy content outside of your app, going to the web to buy it. Eventually it will open up the actual app to more real payment methods in games, as you see in other apps in the app stores.<\/p>\n\n\n\n
GamesBeat: We\u2019re not quite sure what the line will be. Will Apple allow people to use their own payment systems as an alternative to Apple Pay?<\/strong><\/p>\n\n\n\nFernandez Remesal<\/strong>: Right. But from that perspective, games have been punished compared to other apps. Why are we not able to build that kind of relationship with consumers? Why can\u2019t we propose a specific payment or subscription mechanic that other entertainment options can do in the app stores?<\/p>\n\n\n\nSandsoft\u2019s Potions & Spells.<\/figcaption><\/figure>\n\n\n\nGamesBeat: Assuming that payments are not going to change, the next best thing is web shops. Set up your own store on the web. In the past companies could not advertise that web shop\u2019s existence inside the app, but now they can. They can say that you can get something for cheaper prices elsewhere. Xsolla has been opening a lot of these web shops and operating them for companies. They have more than 500 of them now. But nobody knew about them. They do say that consumers are using them. They\u2019re going back at a 30-40% rate and creating a 10-16% lift in revenues for developers, or in some cases higher. Those sound like fairly promising results relatively early for alternative web shops.<\/strong><\/p>\n\n\n\nFernandez Remesal<\/strong>: That\u2019s correct. Particularly, if you\u2019re a consumer that pays in mobile free-to-play games, you\u2019re trying to get the best value for money. Eventually this kind of core, engaged audience that makes up the payers in your game, they already know they can go to the shop to get a better offering. For the greater mass of consumers that don\u2019t pay, they\u2019re not really aware they can go to the web shop to buy content and get better deals than going through the app stores, the in-app shops.<\/p>\n\n\n\nThere are two issues here. One is about consumers getting more value for money here. The second is about developers getting more value from the value chain and delivering more of it back to consumers as well.<\/p>\n\n\n\n
GamesBeat: The net result is that it\u2019s more money going to the bottom line for developers to reinvest in their business. That\u2019s been sorely needed, especially in the last two and a half years. We\u2019ve seen a real painful downturn in the global game industry. Every penny counts these days.<\/strong><\/p>\n\n\n\nFernandez Remesal<\/strong>: It\u2019s a better distribution of value in this case, considering what everyone puts on the table. Maybe in the early days of the app stores there were more merchandising options for developers, ways to get value from the app stores. There was less content. Your content could reach more users. There was value in the promotional activity the app store would run for you. Now that\u2019s heavily driven by UA. In that context, the app stores really just become a payment method. From that perspective, developers capturing more value and giving more value back to consumers is good, because that\u2019s reinvested in the game industry. Game developers capture more value and that helps them create better content and engage better with consumers.<\/p>\n\n\n\nGamesBeat: We\u2019ve talked about some of these trends. How are you most closely aligning your company to some of these trends, to take advantage of them?<\/strong><\/p>\n\n\n\nIza\u2019s Supermarket is a game from Sandsoft.<\/figcaption><\/figure>\n\n\n\nFernandez Remesal<\/strong>: There are a couple of trends we didn\u2019t discuss much. One is about how mobile games in particular are becoming more complex. Three years ago we were talking about hypercasual games, games mostly monetized through in-game advertising. Because of the challenges around privacy, games are becoming more deep now. They have microtransactions. Even casual games are becoming more complex. They have metagames on top. They have deeper economies. Casual games are becoming more mid-core.<\/p>\n\n\n\nMid-core games are going this way as well, to more core game mechanics. You see plenty of games with battle passes, with more core engagement loops that you didn\u2019t see before. And then when you go to really core games, they\u2019re becoming more like casual games. They\u2019re trying to simplify at the core, trying to make themselves more accessible. There are some shifts on the way. Game developers are making games that are in a way more complex, but they\u2019re trying to simplify the core game mechanics to be more accessible.<\/p>\n\n\n\n
As a company we\u2019re trying to follow these trends. We\u2019re working on a few casual games that we\u2019re releasing with our exterior partners. We\u2019re trying to observe how we can propose these deeper economies in games that feel very accessible, that are easy to play, that are easy to grasp and explain through a simple ad, but that can eventually retain and engage people for a long time.<\/p>\n\n\n\n
The second trend we didn\u2019t discuss much was generative AI. That\u2019s transforming not just game development, but many industries. It\u2019s a new tool for everyone to use and leverage. Any game company, or any company at all, in the long term needs to have a proper AI strategy. In our case we\u2019re leveraging AI mostly for content creation, mostly for ads at this moment. We\u2019re enriching our NPCs through AI. But I presume that we\u2019ll be adding efficiencies in most of the things we do, like game programming. We\u2019re doing code reviews with AI now. We\u2019re doing some small level designs with AI. That\u2019s one of the tools that\u2019s going to provide superpowers to game developers.<\/p>\n\n\n\nDavid Fernandez Remesal moved to Saudi Arabia to run Sandsoft.<\/figcaption><\/figure>\n\n\n\nTeams that, a few years ago, were considering building an engine of their own, they don\u2019t do that any more. They use Unity or Godot or Unreal. Now there are pipelines for game development that will be transformed by the use of AI. Things that need 10 people to do them nowadays, one developer might be able to do them more efficiently a year from now.<\/p>\n\n\n\n
GamesBeat: Would you consider bringing mobile ads into the company because of AI advances? Mobile ad optimization now can be done quite well by AI. Fewer people can get much more work done in terms of creating variations on ads to test them in the market and see which particular ad does well. That optimization process was often handled by outsiders. Could that change?<\/strong><\/p>\n\n\n\nFernandez Remesal<\/strong>: On the go-to-market you\u2019re precisely right. For mobile games, what we call creative optimization is part of the way that you can optimize your growth strategy. But it\u2019s broader than that. When you think about how, particularly in this case, artists work, they work on content production. You create some illustrations of characters and environments, and this is transformed by AI. With one artist you can get 100 different concepts with just a couple of prompts. Before, in the manual world, you\u2019d need to spend probably half a day to just create one. This is about being more open for creativity, to get more options for exploring characters, environments, and art styles. It\u2019s not just on the advertising side, too. It\u2019s on game creation, too, to explore new concepts in a broader way.<\/p>\n\n\n\nGamesBeat: In Saudi Arabia you have some parallels to Brazil in some ways, in terms of what you do with the team that you have. The team is relatively new to games. You\u2019re growing a local staff. We saw some very interesting trends in the past year around Black Myth: Wukong. It was a Chinese-made game made for Chinese consumers, the Chinese market. It did spectacularly well on the global stage as well, 25 million copies sold right off the bat. It validated the notion that a country\u2019s local content could be appealing on a global scale. A lot more games are being greenlit in China now with hopes that they\u2019ll reach a global market.<\/strong><\/p>\n\n\n\nSandosoft\u2019s PocketNecro<\/figcaption><\/figure>\n\n\n\nFor you, in Saudi Arabia, do you have a choice to make around whether to make local content or global content?<\/strong><\/p>\n\n\n\nFernandez Remesal<\/strong>: As a game developer, we\u2019re creating content for global markets. We\u2019re not doing content to be consumed locally. But that doesn\u2019t mean\u2013as in any part of the world, you have local stories, local myths, local themes that you can expose and eventually create connections with consumers and players everywhere in the world.<\/p>\n\n\n\nWhen I think about our talent pool, I won\u2019t deny that we\u2019re quite an international company. We have 100 people on the team who come from 30 different nationalities. We\u2019re still a nascent state in terms of local Saudi talent. We don\u2019t have enough capability to create these local stories in a way where they feel authentic, where they\u2019re told by the right people. But that will come eventually. I think there\u2019s a good analogy when you think about movies and television. There are plenty of stories from this part of the world that have been told. We talked about Aladdin, about Prince of Egypt. There are plenty of stories that resonate with global audiences. But we need to have the real people, the local talent that can tell these stories in a way that eventually attracts a global audience and can become a mass market opportunity, rather than a niche thing for the local market.<\/p>\n\n\n\n
GamesBeat: A lot of this is maybe a stepping-stone process. You have to level up your team. You have to make sure that they can grow to be veterans of the industry. Then at that point the opportunities change. You can use them to be the central creators of the content.<\/strong><\/p>\n\n\n\nFernandez Remesal<\/strong>: Correct. When you\u2019re creating games, when you\u2019re creating many kinds of content, it comes from your own passion. There\u2019s some sense of the market involved, understanding whether there\u2019s a commercial opportunity, but it comes from people\u2019s passion. The passion is there, but the skills and capabilities are not there yet to think about a global game opportunity. We\u2019ve seen that in other games. Assassin\u2019s Creed is a good example of that, where they\u2019ve taken worlds and themes that resonate in the region, but not to the extent that it feels like a proper story from that part of the world. But you\u2019re precisely right. We need to wait a few years to have this capability in place so we have a credible story to tell in a commercial way and can meet the quality expectations that global audiences have.<\/p>\n\n\n\nGamesBeat: From what you\u2019ve seen, what is your assessment of where talent is? Whether in your region or other regions of the world as well. Where is the best mobile gaming talent now?<\/strong><\/p>\n\n\n\nSandsoft\u2019s Wizario<\/figcaption><\/figure>\n\n\n\nFernandez Remesal<\/strong>: The answer for me is quite easy. You just need to look at the games that make the top of the charts. China has definitely become the world leader in game development talent for mobile games. It\u2019s not just about Tencent or Netease or MiHoYo. Plenty of game developers are creating games that are consumed globally. That\u2019s the larger talent pool for mobile games.<\/p>\n\n\n\nIt\u2019s true as well that the pool is expanding quite broadly. Creating mobile games is more accessible than going for triple-A console games. There are plenty of pockets of excellence in Europe, in the U.S., in Latin America. I\u2019m really impressed by people here in Brazil, in Argentina, in Uruguay, in Chile. That\u2019s becoming more accessible. Talent is developing in many parts of the world.<\/p>\n\n\n\n
In my region, in Saudi Arabia, it\u2019s very new. I think that\u2019s resonating with people here in Brazil. Maybe we\u2019re Brazil five years ago. There were some pockets of talent that were trying to get their first companies into the market. We\u2019re on the route where we\u2019re importing talent to support game development, but also building local talent, so we can develop the whole industry.<\/p>\n\n\n\n
Another topic that\u2019s not so much a trend as a reality now, it\u2019s about going cross-platform. There are plenty of mobile first games that are thinking about moving to different platforms. When you think about how you can go to market, how you can prototype, mobile is usually the cheaper platform to do that. We see more and more teams getting their IP into PC and console coming from mobile. We\u2019re observing that more and more.<\/p>\n\n\n\n
Another trend we see is transmedia. Maybe that was a buzzword at one point, people thinking about migrating IP from games into other art forms, but we definitely see it quite a bit now, particularly the series we\u2019ve seen from Netflix and Amazon and so forth. Rovio is doing movies. Transmedia is becoming a trend for companies with deep pockets and deep budgets.<\/p>\n\n\n\n
GamesBeat: The biggest thing to watch right now, I would agree, is AI and where it\u2019s going to change things. I believe that mobile gaming is one of the areas where it\u2019s going to have the biggest impact. AI can\u2019t create triple-A games yet, but there are a lot of things related to the business of mobile games that can be automated. We\u2019ll see where that takes hold and gets traction.<\/strong><\/p>\n\n\n\nFernandez Remesal<\/strong>: Something that we\u2019re seeing quite a bit here in Brazil is the renaissance of web gaming. WebGL has really improved lately. We see amazing experiences on the mobile web. Mobile web will be an opportunity for game developers. It links to what we mentioned before with web shops and how you can monetize.<\/p>\n\n\n\nGamesBeat: We have the Nintendo Switch 2 launching very shortly. The interesting thing about now versus years ago is that Nintendo is no longer the first device that kids get their hands on as a gamer. It\u2019s smartphones and tablets now, mobile games. That\u2019s how they learn to play games, which represents a sea change for companies like Nintendo. They have to follow this trend. The youngest gamers are only going to know the brands that they see on mobile.<\/strong><\/p>\n\n\n\nFernandez Remesal<\/strong>: That\u2019s precisely right. Mobile is the first gaming device for many, many people, particularly kids. That\u2019s where they discover content. It\u2019s not just games. It\u2019s how they find all forms of entertainment \u2013 streaming media, music, and games as well.<\/p>\n\n\n\nDisclosure: Gamescom Latam paid my way to Brazil.<\/em><\/p>\n
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