Nazara Tech hires industry veteran to grow its freemium gaming business

Nextwave Multimedia's WCC titles are played by around 10.58 million monthly active users as of Q1-FY24, with 96 percent players from South Asia region

Nazara Technologies has roped in industry veteran Christopher Franklin to lead its mobile gaming subsidiary Nextwave Multimedia as the diversified gaming and sports media firm looks to grow its freemium gaming business.

Franklin comes with over 20 years of experience in the gaming industry. He recently served as the game design director at the video game publisher Electronics Arts for about a year.

Prior to this, he has had stints at mobile game publisher Glu Mobile, video game developer Ludia, social casino gaming company GSN Games and mobile gaming company Mango Games.

Franklin is taking over as the CEO of Nextwave Multimedia from founder PR Rajendran, who will now serve as the company's board chairman, Nazara Technologies CEO Nitish Mittersain told Moneycontrol.

Read: Nazara Technologies says 28% GST on real-money gaming to have minimal revenue impact

Nazara Technologies acquired a majority stake in Nextwave Multimedia in 2018. The diversified gaming and sports media firm increased its stake to 71.88 percent in May 2023. The Chennai-based company predominantly focuses on developing casual and multiplayer mobile games in the sports genre.

Its flagship title is World Cricket Championship (WCC), which claims to be the largest mobile-based cricket simulation game. It has subsequently released two sequels so far - WCC2 and WCC3. The firm claims to have clocked over 100 million downloads across mobile platforms in the past seven years.

WCC titles are played by around 10.58 million monthly active users as of Q1-FY24, with 96 percent players from South Asia region and the remaining 4 percent from the rest of the world. The titles also clocked about 1.71 million daily active users for the quarter.

"The WCC franchise has huge potential compared to the revenues it generates today for us. So we brought in Chris, who comes with strong game design capabilities. We hope to revamp the game design from the way we are approaching it and significantly scale up this business. I think in the coming quarters, it will show up in our numbers as well" Mittersain said.

Nextwave Multimedia posted revenues of Rs 7.2 crore for the first quarter of the financial year 2024 (Q1-FY24), a modest 7.5 percent year-on-year increase from Rs 6.7 crore revenue in the same quarter last year. The company however accounted for a miniscule 2.83 percent of Nazara Technologies's Q1-FY24 revenue that stood at Rs 254.4 crore.

A snapshot of Nextwave Multimedia's financial performance in Q1-FY24

Plan to increase monetisation

In the forthcoming future, Nextwave Multimedia plans to initially improve the game retention with user interface and user experience fixes and then focus on improving the game monetisation, through both advertising and in-app purchases.

The games are also moving to an online-only experience, which would mean that users will need to be online to play. This move is expected to increase its base of daily active users.

"We are aiming to 2X (double) our ARPU (average revenue per user), which we are quite confident about, and then we will start spending money on marketing. Today, we barely spend any money on user acquisition," Mittersain said. "We believe a game like WCC should have at least 50 million monthly active users. So how do we go from 10 million to 50 million is a problem we're trying to solve."

The company intends to launch a large marketing campaign prior to the upcoming ICC Men's Cricket World Cup that is starting from October 2023, Mittersain said.

Read: Nazara subsidiary Nodwin Gaming to buy 51% in Singapore-based live events firm Branded

Scouting for more deals

Nazara Technologies is looking to acquire more gaming studios to expand its freemium gaming business, amid a broader push to grow all of its existing verticals that includes eSports and adtech, Mittersain said.

The firm recently received the board approval to raise up to Rs 750 crore through issuance of equity shares. It intends to raise this capital through qualified institutional placements, preferential allotment or a combination of both.

Mittersain said they intend to use some of these proceeds towards acquisitions. Apart from freemium gaming studios, the firm also plans to shop for gaming-focused adtech companies, programmatic adtech firms, and media buying or media planning agencies to expand its presence in developed markets.

"We are not looking at launching a new vertical but instead focusing on going deeper into each of our segments, making the business healthier and stronger with better cash flows and doing M&A that makes our verticals bigger" he said.