The next success for the organization behind Angry Birds could be two-fold, convincing the public of US that they should buy a 5G mobile phone from Sprint, and secondly developing the world’s largest video-game streaming platform which in the process.
Rovio Entertainment is in talks with a lot of investors to take a stake in its subsidiary Hatch a platform called Netflix for games that Sprint will use to showcase what its high-speed handsets of 5G can do when it opens its new network in the month May.
But Rovio Executive Chief Officer Kati Levoranta also needs many new investors to buy into her vision for the long three-year-old Hatch, on which the Rovio company has already spent about EUR 17 million ($19 million), to help it stand up its library of games from game developers such as Sega and Ubisoft.
The service of Hatch is brilliant for use with a 5G network, and many of our strategic partners are looking for similar services which demonstrate how 5G network works and the benefits it brings, Levoranta stated in an interview at the seaside headquarters of the organization in Espoo, Finland.
She said the organization was looking to cede control of the business by bringing in several new investors in order to build partnerships with several new studios.
For the shareholders of Rovio, still reeling from the organization’s plunge to half its value since the primary public offering a year and a half ago, various outside investors for Hatch could ease concerns that its parent would require to bankroll it indefinitely.
5G is a very big opportunity for us, Vesa Jutila, chief commercial officer and co-founder of Hatch Entertainment Oy, said in a recent interview. “Everyone seems to think that cloud gaming is the way to tell the 5G network story to consumers.”
The application provides a portfolio of pre-vetted games to all the customers, streamed to each of their handsets through a monthly subscription. Once the primary account is set up, mobile games can be played straight from the cloud platform, without requiring to be installed or downloaded. The advent of low latency, high-speed 5G networks makes the model all the more attractive to carriers looking to sell their latest modern services.
Hatch is already working with an operator in three of the world’s top four games major markets: NTT Docomo in Japan, Sprint in the US, and LG Uplus in South Korea. It is looking for a partner in China, the globe’s biggest market for games.
China, being very much mobile-oriented, “is completely ideal for a service like Hatch”, said Juhani Honkala, the company’s CEO and co-founder. “Also, given the games run from a server, that cannot be copied. It is very safe and secure for the players, but also for the game developers because the games cannot be leaked.”
Rovio has 80 percent holding in the unprofitable Hatch, with its four co-founders having the ownership of the rest. NTT Docomo is slated to take a stake, but the size usually depends on the outcome of the full financing round of Hatch that is underway, according to Rovio.
“We cannot be the subsidiary of only one studio if we seek to become a global brand with games from all the major top studios,” said Jutila. “It is quite important for our partners that we are not part of Rovio company, but an independent service – a platform where they can safely and securely deliver their games.”
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