Minecraft: Using Social Media to Create a Successful Game
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Case Code: BSTR440 Case Length: 15 Pages Period: 2009-2013 Pub Date: 2013 Teaching Note: Available |
Price: Rs.300 Organization: Mojang AB Industry: Games Countries: Sweden, US, Global Themes: Business Strategy |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
Minecraft and the Community
The term which came closest to describing Minecraft was a “Digital Sandbox”. Quite contrary to the highly realistic feel and chic graphics of contemporary video games, the game had a pixelated look. The game started in the middle of a world that looked all blocky and extended unbounded in all directions. The game had all the natural environmental features found in the real world, namely, mountains, rivers, rainforests, islands and even flowing lava...
The Growth of Mojang
When the sales of Minecraft crossed 15,000 copies in the summer of 2010, Persson realized that it was set to become a big hit. Consequently, he resigned from jAlbum and set up 'Mojang' (Swedish word for gadget), with two of his previous colleagues. They were Porser, with whom he worked at king.com, and Manneh, who had been the CEO at jAlbum. Persson established another company called Notch Development to hold the Minecraft Intellectual Property (IP)...
Minecraft and Piracy
Analysts pointed out that most game developers held the belief that players just had to ingest the content that the developers created. Game developers were found to be very keen on safeguarding the IP they created and were wary of providing players any access to tamper with it. However, Minecraft went against the conventional wisdom in the gaming industry, with Persson being quite open in discussing what part of the code he was working on, seeking new ideas from players, and even releasing the API of the game...
Courted By Venture Capitalists
The rising popularity of Minecraft attracted several venture capital firms to come up with offers to invest in Mojang. However, Persson and his team constantly rebuffed these offers. Speaking on this issue, Manneh said, "During the spring of 2011, I had VC conversations every single day for three months. I probably talked to 100-150 VCs." Among the prominent prospective investors was Sean Parker, one of the founding members of Napster and the foremost President of Facebook. Porser who met and discussed the video games industry and Minecraft with Parker, felt that he was not so keen on the business of game development...
Other Ventures of Mijang and Persson
Over a period of time, Mojangin collaboration with other entities released various merchandise associated with the game such as clothes, books, and children's toys. This accounted for about 8% of the revenues made by the company from the game. One of the most important of these merchandising deals was with The Lego Group , through which the highly popular Lego Minecraft sets were released...
The Next Level
In 2012, Minecraft had generated revenues of US$ 235 million for Mojang, with a net income of US$ 90 million before interest, taxes, depreciation, and amortization on revenue. Mojang had also taken over the Minecraft IP from Persson's company Notch Development. Speaking about profits in 2012, Manneh added, "Since Mojang keeps more of the earnings from the new Minecraft versions, our turnover increases a lot this year. Our profits will more than double. Markus' company will also make more money, though perhaps not as high a percentage as Mojang."...
Exhibits
Exhibit I: Screenshot of Minecraft
Exhibit II: Games that Served as Inspiration to Minecraft
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