Extraordinary Games Businesses 4: Ankama

Ankama is arguably one of the most ambitious in the industry, whose vision of products that aggressively expand across multiple games, online and broadcast media platforms can only be described by the word chutzpah.

The company was founded in 2001 in Lille, Northern France, by Flash developers keen to do games development but bootstrapped by commercial website design. The studio grew slowly at first, constrained by work for hire, and putting its downtime into designing a PvP combat game in Flash entitled Duel. The studio was extremely cautious through the beta period which lasted for nearly two years, finally hard launching Duel – renamed as Dofus – in 2004 in France.

DOMINATING SUBS
By then Dofus had been reworked as a download-based isometric 2D role-playing game where players can choose between familiar fantasy classes, and conduct turn-based combat using spells and weaponary. Based on a model of a seven-day trial before subscription, Dofus grew steadily over the next year to half a million registrations but experienced the commonplace difficulty of converting free triallists to subscribers when the subscription barrier came slamming down. No doubt with an eye on RuneScape and other, earlier freemium games services, Ankama bit the bullet and introduced a permanently free play area with a burgeoning array of premium extensions
for subscribers.

Freemium turbo-charged the company’s revenues and its user base, transforming it from a niche MMO operator into a multi-title, multimedia powerhouse. Registrations leapt forward, reaching three million in 2006, seven million in 2007, ten million in 2008 and today the game stands at 22 million registrations, just over ten per cent of whom are subscribers. The company grew from 25 staff before going freemium to 400 today (nearly as many developers as Ubisoft’s French studios combined). As the company grew, its true ambition became clear. Ankama Games was hived off when Dofus hard launched. In 2005, Ankama Publishing was launched to harvest Ankama IP in television via animated children’s shows and Ankama Editions was formed to self-publish the manga-style comic Mutafukaz (no pun was intended, apparently). Kalmeo, a mobile division, was launched in 2007 to harvest its IP on mobile platforms. Recently, it opened an animation studio in Japan.

How did it achieve all this? With the decision to go ‘free’, the company carefully constructed a commercial model that has proved very successful at converting free players to subscribers. Ankama set out strict and aggressive barriers between free play and premium areas, keeping 90 per cent of the game world behind the velvet rope, and restricting progression in almost every area of gameplay beyond the first basic steps. This free vs premium split is at the heart of both the gameplay and the company’s success. Subscription opens up a wide range of premium-only functionality, such as higher levels, classes and items, item creation, pet ownership, inter-player trading, PvP arenas and gifting. Subscribers can freely mix with non-subscribers, passively marketing the benefits of subscription. Yet the free game remains compelling and deep enough to hook new players and start to spin the social webs between other players. These extend so far that Ankama even runs regular festivals where Dofus players meet their online friends and the game’s creators in the real world, costumes and all.

ANKARMA CHAMELEON
Ankama is a stable, very well-run business with sustainable cash-flow and has never resorted to external investment. It has great strengths in marketing, technical ability, quality of game design and communications. But there are contradictions. Its user base has remained unsurprisingly dominated by French speakers, with a smattering of other territories covered. For all its scale, Ankama has largely failed to break out of this geographical silo, a challenge for all continental online publishers. More dangerous is the company’s ambitions in other media. Its strategy to flog the hell out of its brands on as many platforms as possible make it vulnerable to diffusion, and could siphon investment towards possibly reckless projects in other media, which could damage customer satisfaction. This risk is best illustrated by its biggest bet so far, Wakfu.

As Dofus nears the hard launch of its 2.0 version, Ankama has gradually been unveiling its next, even more ambitious title, Wakfu. It is 100 per cent built in Java and has better music, animation, scrolling navigation, complex in-game economies and, with typically boldness, no NPCs. Wakfu is being built for PCs, with mobile and Xbox Live extensions. It will also have a separate card game, a magazine, a comic, a television series and merchandising.

Ankama remains a formidable company – a classic online developer-publisher with a strong track record of delivering high quality games with great conversion ratios, and hooking huge audiences with compelling gameplay and appealing stories and characters. Whether Wakfu succeeds as Dofus has done will be interesting to watch.