How Lockwood Publishing survived the closure of PlayStation Home

Nottingham studio Lockwood Publishing was founded ten years ago, and made its revenue from PlayStation Home. As well as work-for-hire services, it developed its own games for the PS3’s social platform.

Just a few years ago it employed 60 staff. But toward the end of the PS3’s lifecycle and as its successor the PS4 loomed, the future of PlayStation Home was uncertain. Sony kept its cards close to its chest on its future plans, even from the studios that made games for it.

It officially announced Home’s closure in September 2014. At the same time this confirmed the social platform wouldn’t be making the shift to the PS4.

Lockwood anticipated this would happen – it was arguably obvious as Sony began gradually dropping support for the platform – and began restructuring its business. But no actual confirmation was forthcoming.

“We did get a little bit of a notice, but we never got any kind of confirmation,” Lockwood CEO Halli Bjornsson tells Develop. “We were kind of hoping actually it would carry on.”

All of our revenues were coming from PlayStation Home, so you can imagine obviously we had to lay off some people.

Halli Bjornsson, Lockwood Publishing

The company’s co-founder Joel Kemp says it was a shame that Home was finally closed, as it had been a very profitable business for the firm, but recognises it may not have been the same for Sony itself.

The uncertainty surrounding Home deeply affected Lockwood’s business. Bjornsson says the company had to go “into a kind of retreat”.

"We had to literally pivot our business from console over to something else in a very short space of time,” he says. “And that’s obviously hugely stressful for any company. I mean all of our revenues were coming from PlayStation Home, so you can imagine obviously we had to lay off some people and so on. And we still had to manage getting stuff out."

Kemp adds that during this time it was difficult to manage company morale, given there was no confirmation that the product all their income was coming from might disappear completely. It was at this time Lockwood began the move to mobile.

“I guess that’s one of the dangers of your when your company relies very much on another company for all your income,” he states. “We’ve got traction on mobile now. There’s no one company now that can stop our revenue and growth.”

Extra life

Moving to mobile was a difficult decision of course, particularly for a business built in the console world. Bjornsson says the two sectors aren’t particularly comparable, though the experience it had in a free-to-play space would certainly help in future.

As an insurance policy to Home, it began investing in a new game, 3D life sim Avakin Life. The title got off to a slow start though, and it wasn’t clear the game could replace its success on Home.

No money was spent on promotion or customer acquisition either, despite an intial plan to raise money to do so, thanks to the rising costs of mobile marketing.

“We brought Avakin out leading up to Christmas [2013], and customer acquisition costs went up to $4 or something like that on iOS,” he says. “And we were like, shit.”

Despite the lack of a real marketing campaign, Avakin Life was able to slowly gain a large userbase, and ultimately keep the studio going post-Home. The game now achieved more than 7.5m downloads, with 17 staff working on the title.

“Our revenues had a slow start, but they’ve gone form around $300 a day to over $3,000 a day in about half a year. We’re on a huge kind of growth,” reveals Bjornsson, who has also provided us with a chart signifying its growth since the game’s release, relevant as of early May.

This graph spans from 2013 to May 2015 and shows in-app purchase and Tapjoy daily gross revenues combined

Bjornsson says Avakin Life’s recent popularity came around the Christmas period as the game also matured and garnered a loyal community. He also notes the game’s relative uniqueness on the app stores has helped spur its growth, targeting markets that aren’t as well catered for as others

"You’ve got these spots on the app stores where there’s more demand and less supply,” he says. “And also, quite possibly in 3D development, most developers probably tend to make games that they like, and since most developers are men, I suspect a lot of them have focused on their particular genres."

The move to mobile has allowed Lockwood Publishing to find a more stable footing, and one away from the uncertainty of Home and those "brutal" console cycles. Kemp says despite the difficulties with Home towards the end of its life, the company has a lot to thanks Sony for, in particular offering what he calls was essentially an “incubator for small indies”.

"They took away a lot of the headaches, like finding the audience, marketing, they provided all the back-end. Maybe they were too generous,” he states.

“It was great form that point of view, but you know, as the company scaled, obviously there was always that concern that Sony would get rid of Home. So it was a like a double-edged sword in many ways.

Bjornsson adds: "Ideally you want to be somewhere where you’ve got more options, for sure."