Benjamin Chen
Editor’s note: Benjamin Chen is the EVP of developer relations and business development at Fyber.
This year we’ve seen major acquisitions in the connected home space, tons of chatter around #bendgate, AI entered center stage with Cortana and Amazon’s Echo, and Kim Kardashian is now available in app form.
But that’s enough of looking back. Here is what I predict 2015 will bring.
The Gaming Market Correction Is Coming
Over the past few years, we have seen Wall Street valuing gaming companies as high growth internet stocks because of their rapid consumer adoption and ability to generate revenue from its core user base. But the mobile gaming industry has reached maturation. The days of blue skies and endless funds are behind us, and 2015 will bring an execution-focused mindset to the space.
As gaming companies mature, they bear a striking resemblance to traditional media companies. They focus on brand building, IP creation and licensing to scale. Because of this focus, the market will need to start valuing gaming companies for what they are: next generation media companies.
The U.S. can look East to Asia’s market for directional guidance. For example, Gumi filed for IPO in Tokyo and received a $900M valuation based on the strength of its multi-faceted media business. Gaming companies will continue to control their own destinies and start revaluating their current market position in order to recreate this level of success on American soil.
A Shift From “Build or Buy” to “Build or Partner”
The so called “killer app” will remain elusive as more early- to mid-stage companies realize that they aren’t solving more than one to two core problems in their respective fields. Startups will start asking themselves if they are really just a feature or if they are a true business.
To stay afloat, they will start banding together to produce a more holistic offering for a customer, knowing that they alone cannot rule every facet of a user’s life. Sure we will see some market consolidation, but the focus will be on joint ventures and partnerships that will benefit the end user. We are shifting from a “build or buy” to “build or partner” mentality.
We’ve already begun to see this shake out in 2014. Look at Uber and Spotify, who teamed up to let users become backseat DJs on their rides home. There is also Snapchat and Square, who partnered together to create Snapcash. The companies who will benefit the most from these collaborations will be those who have a great feature or product without the means of penetrating the mass market. A word to the wise for all the tech founders out there: Find three other startups that are complementary to you and start talking partnerships.
Sports Will Be the Next Unicorn Industry for Tech
And finally, what would tech predictions be if not without a curveball. There’s a pun in here somewhere. The (more) bold prediction is that the sports industry will produce the next tech unicorn. It won’t be a team, but rather a supporting service provider or platform that caters to the industry.
Think about it. Sporting events provide the biggest opportunity to reach a massive audience all doing the same thing at the same time. Layer on a wired stadium like Levi’s Stadium, and the possibilities are endless for disruption – both in terms of hardware and software.
Geofencing at sports venues will provide scaling opportunities, and a highly qualified – and not to mention, passionate – audience. This will be the most qualified audience for advertisers to reach — ever. You can see what they buy, what they eat, where they sit and more. If a tech company can figure out how to enhance the in-person gaming experience, it could prove very lucrative.
Fantasy sports will also be heading to the next level as daily competitions like FanDuel and Draft Kings will continue to scale and online sports retailers like Fanatics will be catapulted into the billion dollar ecommerce club.
These are just a few of my predictions. What do you think 2015 will bring?
Comment