Watch the full video interview embedded above, or click here for a direct link.
: Ladies and gents, welcome back to AusGamers, once again coming from the show floor at PAX Australia. I’ve got an historic guest with me today: Victor Kislyi who is the CEO of this amazing company, Wargaming, that just seemed to explode out of nowhere, and now you guys are just... everywhere I go I see Wargaming everywhere. World of Tanks is going to Xbox, and that’s your first console plunge, and you’ve got two more titles coming out.
Can you talk about the grassroots beginning for you and the company, and where you are now, and how that feels?
: Well, thank you very much for the opportunity to talk to your viewers. You know, we’re not coming out of nowhere: this year we celebrate 15 years of our company. So before World of Tanks -- which we started to make approximately four and half years ago -- we have been making strategy games since 1998. We’ve done turn-based strategies, we’ve done real-time strategies, so we learnt a lot about our core target audience -- which would of course be the guys [who] love military history; who love big toys with big guns.
But yes, in 2008 we started making World of Tanks, and we put all that we had into that project. We decided not to do anymore boxed single-player, retail-oriented products, because this industry was going nowhere. We burned all the bridges with our past, and concentrated on this new online massively multiplayer game, and it really, really exploded.
Four years ago we were 60 people, and today Wargaming.net is 1800 people, with 15 offices around the world, starting from Tokyo, South Korea, Singapore... (we have 45 developers in Sydney, by the way). There’s a bunch of Eastern European towns, there’s Paris, there’s London, there’s Cyprus, there’s Chicago, San Francisco, and Seattle. And this number, 1800, is not enough to do what we really have in our heads.
Most of those people are still related to World of Tanks, and will be, because the game grows, but we have to... even after three years, we keep releasing updates approximately once every two months. Every two months we have to deliver new maps, new tanks, new gameplay modes, better physics, better visuals, and it is going to be happening for the next five, maybe ten, or even 15 years.
The rest of the company is engaged in our new project. So we have World of Warplanes, which is in open beta in Europe and America now, so within one or two months, we’re going to be releasing World of Warplanes. And World of Warships is in internal pre-alpha testing, so it will be ready, we hope very much, for the next year. We also have, in Chicago, the former Day One Studios, is making -- pretty much finalising -- World of Tanks Xbox 360 Edition.
Chris Taylor in Seattle is doing something great, but it’s too early to talk about this, because it’s still experimenting, and there’s still some prototyping, and throwing ideas around, but that is definitely going to be something that is going to eclipse everything we have done before.
We have World of Tanks Blitz, that is again, undergoing some friends and family testing: that’s like World of Tanks, but for your iPad or Google device -- for the mobile. And there are a couple of other projects going on, but again, it’s too early to talk about them.
So yes, we -- after seeing the first glimpses of success with World of Tanks -- did not start by buying Ferraris and drinking cocktails on exotic islands, we wisely were reinvesting pretty much everything we were earning, and hiring more and more professional talented people, to give you more World of Tanks, and to spread World of Tanks all around the world -- from Singapore, to Australia, to the West Coast of the United States -- and also to start the new and exciting projects I’ve just mentioned. That’s what we’re doing now, and I believe that was the first 15 years, and it is really just the beginning of everything.
: It’s a remarkable amount of growth for a company, to start where you just mentioned, and spread so much globally. How much can you attribute that from the investment in your games by the players, the gamers themselves, and how much have they helped shape the way the business is run?
: Well, frankly speaking, the origins of World of Tanks... Henry Ford once said “If I ask my customers about what they wanted, they would ask me for a faster horse”. So sometimes you have to break through; sometimes you have to be innovative. World of Tanks was exactly that project. Apart from a few military history and armoured warfare enthusiasts -- who always like to have anything about tanks -- the rest of the industry and gaming media: they were like “World of Tanks? Seriously? Do you really believe people will be associating themselves with machines? But not the bipedal, human machines. No, that’s not going to work”. Well, it so happened that we were bold enough to do something nobody was believing in, and it worked out.
After that, after the game was released for open beta, then released in Russia, yes, that’s the moment you have to have lots of community management people; you have to have a forum, and you have to communicate with your players. Going out and meeting them; to tradeshows; just going to meet them... we were doing this in Poland, and in Germany, and Russia, and the United States on every possible occasion, and after they play your game for a month or two or three, they start to generate ideas, and that’s when you have to listen. So the answer would have to be no, and yes: no in the beginning, and yes ever since.
: How long was the project for Xbox 360 in the pipeline? Because obviously it was announced at this E3, and it’s the first time that the product has been available off PC. That’s really exciting, but that E3 was also all about Xbox One, and I’m curious to know why you chose the Xbox 360, and didn’t just work towards a next-gen version of the game running on console.
: Well World of Tanks Xbox 360 Edition was being brewed for a year and a half. So we knew some people at Microsoft, and we managed to convince them that free-to-play was the way, and they said “Ok, go and try doing this game for the Xbox. We said “Ok, in Eastern Europe, unfortunately, we don’t have the expertise in AAA console development that much”, so we were honest, and asked Microsoft for a list of independent companies which could do that. So Day One -- with their 12 year experience in making games like F.E.A.R. -- were on top of the list, so we came to the guys and painted them [a] bright future; shook hands, did a little acquisition, and started working together in the condition of top secrecy -- because this is Microsoft, so we were all getting ready for this big announcement on the stage at E3.
By that time, one and a half years was quite enough for the Chicago guys to... they were using their front-end technology for Xbox visualisation, and they were using Wargaming’s Bigworld server-side technology -- they just married the two. Of course, all the assets, all the historically accurate tanks, and lots of the buildings, trees, and terrain features, we just gave all of those assets to them, and they transformed them to be more suitable for the Xbox format.
Of course, they’re using the proven concept of free-to-play monetisation we’re using for the PC, and within a couple of months we will see whether or not we will be able to deeply engage 47 million Xbox Live community members. There’s no way to guess theoretically, you just have to make it for the first time once, launch it, and then see how it goes.
Speaking of Xbox One, well nothing prevents us from making a version for Xbox One, but first it has to come out, and second: probably within the first year, the amount of instalments will not be enough, in terms of critical mass. Whether that’s good or bad... but for an online free-to-play game, you have to have critical mass -- World of Tanks now has 65 million registered players around the world -- so we probably will wait a little bit.
So first of all, we have to deliver the Xbox 360 version, where 47 million people are presumably waiting, and if it goes well, we just keep going and do it for the Xbox One. Why not?
: Talking about 47 Million. But then you’re talking about 60+ million on your own end as well, in established players playing this game. Quantifiably, how much bigger can you see the brand growing?
: I think the potential market for a tank or a warplane game is the population of our planet divided by two, that’s exactly what defines a man [laughs]. But seriously, of course you have to... well, ironically, and very luckily for us, after the success in Russia, people would say “Ok, Russians love tanks”, this is true, because in World War II, thousands and thousands of tanks, if not hundreds of thousands of tanks were rolling back and forth in Russia, Ukraine, and Poland and Germany. So that’s why tanks are in our DNA.
But then there was: you will never pull it off in China. Singapore, Malaysia, Brazil? forget about it. America? Ehh, they love warplanes; well, they love warplanes more than tanks. But anyway, those 65 million people, they come from all over the world, including Korea, Hong Kong, Taiwan, Thailand, Indonesia, and Australia.
We did not have official servers in Australia, but we have 300,000 registrations from Australia. Unfortunately for these people, first they registered on an American server, and the ping times over the Pacific Ocean are very long. Now we’ve transferred them to the Singapore server, so now you can play well, and we are thinking about putting the server on the ground in here.
So potentially, given the level of saturation, or not yet saturation, in Russia, and painting this picture for other countries -- some regions with much bigger populations than Mother Russia -- we can be looking, theoretically, at I don’t know, one billion players. Why Not? Of course, it’s all about the economical development. But this part of the world, and South East Asia, they’re growing like crazy, and the infrastructure... we don’t necessarily intend to stay always on the PC or the Xbox.
Everybody knows the biggest trend right now is the mobile, and there are some countries where people don’t have PCs, they just do everything on the tablets and the mobile, so that’s why we’re making the mobile version of World of Tanks, and that’s why we’re making World of Tanks Generals -- the trading card game for the browser, and for mobile.
So the world is changing and developing very fast, and those billion players I mentioned, they are there. That’s exactly the population of Facebook, and it just takes hard work, lots of people, lots of financial resources, lots of devotion, persistence, passion, and a little bit of luck, to get to that billion people, sooner or later.
: You guys famously turned around and went free-to-play with no pay-to-win, and I talked to some of the guys at E3 about what that means, and it was about reintroducing a way to teach the rest of the development community that you can make free-to-play and it can work. Can you talk about... was it a case of just the sheer growth of the game that made you realise that free-to-play is the only way it can happen?
: That was one of those bright and wise decisions in the beginning of the game design process. We can see now that a lot of companies convert to free-to-play, but the problem for them is that the game was intrinsically designed initially as a single-player or subscription-based MMO, and it’s really hard to transform it into free-to-play meaningfully. Because free-to-play is the essence of the game.
In World of Tanks, you play for free forever, and enjoy it. The rocket science part comes that we have to make money to pay the servers, to pay the programmers, to do promotions, to come to shows like this, and that little tiny line that makes the free experience still enjoyable. But for some people -- people like me, 35+ working professionals -- who have little time, but a little more of disposable income, World of Tanks requires just a couple of movie ticket range monthly.
If you play World of Tanks, you start paying $10, $12, which is nothing for a grown-up man. And that’s the rocket science, how you keep the balance between paying and non-paying users, with certain incentives for guys like me to pay from time to time, but even more incentives for those non-paying users to stay, and not to suffer, but actually enjoy the game. So 65 million registered users, and to the lifetime of almost a year -- well, between six and 12 months is the lifetime in different territories -- this is good proof that we have succeeded in this tiny fine line which we call rocket science.
: You mentioned before that there’s a chance that you’ll actually bring servers to Australia. What do we have to actually do to make that happen? Because it’s really important to...
: Well, this is really good that PAX decided to do this show in Australia, and this is really good that I came here. Unfortunately, it’s my first time, I should have come earlier. Melbourne is really nice, but there was rain, and at the end of the day I thought to myself “Ok, it’s raining; hmmm; people stay at home; hmmm; good!”, ok, that was a joke.
You can feel the vibe here. I’m doing interviews in this room for two days in a row, back to back, and I can see interest, and interesting questions, but through the walls, there is some proof, I can feel the crowd downstairs, and I can sense that huge plasma screen; I see those two teams. One of the Australian clans arrived here, and they’re teaching the newcomers how to play, and downstairs we have 40 machines where everybody can come and play, and we have this queue. So I, while walking around in short breaks, I can see how people that have never heard about World of Tanks just come and sit and start playing. They queue and go up and start playing against the professionals, and sometimes they win, and I can see their faces, I can see their smiles, I can see how happy they are when they kill a tank, and when they win a game.
So there’s huge potential, and I can physically sense it in here, and our team here is very excited. We did not expect, for the first time for PAX, that kind of engagement from the Australians. So I think it’s just a matter of a short amount of time while we bring the servers here, and setup the service infrastructure, and community support, in the way that we do it for our historically core territories like Russia, Germany and America.
: Is there a worry at all within Wargaming, that there’s a barrier of entry now that the game is so popular and has so many players? You mentioned that there are people down there teaching newcomers how to come in and win, then they might go home and jump into the game. But in terms of not always being able to do these events, how does the company approach that?
: Well, we have the best marketing and promotion people. Approximately half of our 1800 employees are on the publisher side, which is community management, customer support, PR, marketing, and all kinds of promotion. It starts with the community. There’s such a thing as word-of-mouth. When you like the game you bring two friends. World of Tanks allows you to play as a platoon and form up a team, or go as far as eSports, playing in tournaments for prizes and money.
This year, World of Tanks league has a $2.5 million prize pool, so somebody will get a huge cheque at the end of the season. We have regional competitions with one quarter, one eighth, and semi-finals, then at the end of year, everybody will come to one place in, I don’t know, some basketball arena, where they will face each other head-to-head, and determine who will get the biggest cheque. That gives a pretty much unlimited variety of things you can do within World of Tanks.
But the fact is, to enter, this is very easy. It’s there’s a tank, there’s forward, backward, left turn, right turn. The mouse rotates the turret, and left mouse button just sends the shell to the enemy. So I believe that it still has great potential everywhere, even Mother Russia, which seems to be saturated, and Australia is a new exciting place.
We will work hard... because we know how to do this -- we learnt a lot of lessons in other territories -- so Australia will be a smooth ride for us, and it will be smooth enjoyment and happiness for Australian players. Because free-to-play is built in a way -- at least we built it in a way -- that it’s always a win-win situation.
Recently we introduced this -- I’ll give you an example -- free-to-win concept, where those battlefield advantages, those little consumables like golden bullets, and golden gasoline, which allowed you to sometimes be a little more effective on the battlefield, and which were only available for real money. Two months ago, we announced free-to-win, and we said: “ok, those people who want to buy them for gold can keep doing that (that’s me, I save time), but the rest of you who never pay in principle can get those obtainable objects by paying for them with in-game money”. So for a school-boy, a teenager, that’s just an extra couple of battles to get the same amount of golden bullets which I buy for say 50 cents, and now on the playing field, we are equal.
So with all those incentives... and media talks about this, there’s forums and zillions of YouTube videos, and you cannot avoid them if you’re a gamer, or interested in anything game-related, you will hear about World of Tanks, be you in Brazil, or in Australia. Again, 300,000 Australians, against all odds, across the Pacific Ocean and five timezones to the continental United States were playing. They must be crying while doing this with a 400 millisecond ping, but they were playing. They take part in world eSports events, so after we just intensively put infrastructure here -- the servers and the people -- I think it will be an easy ride for both Wargaming, and for the players.
: I’ll ask one more question Victor, and this is more of a philosophical one that I really want to get from you, because it sounds like you guys are a really humble company that learns from its mistakes, listens to the industry, but also carves out your own way. Can you talk about where you see the games industry overall going in the next five, 10 years? And what do you think are going to be some of the biggest trends, driven either by yourself, or other independents, and even the smaller guys out there, doing smaller stuff on tablets and iPhones and what-have-you.
: Well, obviously everyone knows... I’m going to be the captain obvious here: mobile will be big. The games are still not to my tastes, of playing games for 25 years, but they will get there. So I’m really excited to see a game like Clash of Clans, though I don’t support certain elements of their design and monetisation, but still it’s a good demonstration of how -- like you mentioned in the beginning -- someone, out of nowhere, can achieve tremendous success. Well they did also not come from nowhere, because they had many, many years of making games before, but it seems like they came out of nowhere. Then they had the second hit game the Hay Day. So it is possible.
I really believe in the one billion potential users concept, it’s not an exaggeration. We just need to get to them. Facebook and Zynga showed us... again, they made certain mistakes, Zynga, we’re not going to be talking about this, but they just demonstrated that there could be one billion people connected to one network, and then there could be, again, hundreds of millions of housewives, older guys, younger guys, guys from those regions where people don’t play computer games, suddenly become gamers, playing those, yes, quite simplistic, but games with a certain level of engagement.
I would suggest to anyone that wants to be successful to view the whole planet as a market. Because traditional thinking of big, let’s say American companies [were] “Ok, USA is the biggest market forever, or maybe Japan; that’s it”. Sometimes even Europe, and Eastern Europe is not a market for them. You know, a great chunk of revenue for World of Tanks comes from countries like Poland, Czech Republic, Hungary, and Romania. You would never, two years ago, three years ago, think of those countries as big money generators for the videogame industry. So global, your company has to be global, sooner or later. Of course, you start small, somewhere in your home country, but then try to expand, that would be my suggestion.
And service: the games are no more those DVD discs which they put in the box on the shelf, which you buy, put in, spend 24 hours of gameplay, and that’s it; go return it to the shop for half price or whatever. MMOs of course, is the way to go, they’re going to be online... because of course, our world is digital, the world is already connected pretty much everywhere, including those places where they don’t have phone lines -- the landlines, they’re using mobile connections. But the games have to be a service, like, I’ll give an example again with World of Tanks: it’s been around for three years, and it’s going to be there for ten, maybe 15 more years, but it does not happen on its own, you have to have that 800 people just supporting that game, in terms of customer support, and community management, and PR, and just making those events for eSports. They’re not programming, or making music, or tank models they are rendering service to paying and non-paying users in the amount of 65 million.
So I think it will all go... there will be a lot of game developers, and we know all of that, and also unfortunately we know that very few of them will survive, because that’s how the gaming industry works. And like in any other industry -- be it music, or Hollywood, or car making -- quality matters, so there will be much more games with much more gameplay hours than the cumulative population of Earth could potentially play. So that’s why players -- and this is natural -- they will view their time as their major investment in any game, be it World of Tanks, or Clash of Clans, or League of Legends.
So at the end of the day, my subconscious would tell me “Victor: this is a free game, but all games are free now, so why are you spending your time on something which you know is not quality -- music-wise, sound-wise, storyline-wise, or gameplay-wise -- when there’s probably another game which is much more enjoyable, and much more higher quality?”, and I will drop this game, and I will go and find that one. Maybe I’ll play one or two or three more, just to find out that they’re not very good as well, until I find that one jewel, brilliant game, and I will stick with it for half a year, a year and a half, two, three, four, five years. So it means I’m lost for non-quality games forever. So I think this will be the spirit of the industry.
I specifically don’t go deep into platforms -- ok iPhone, or Google, or Xbox, or PlayStation -- I think in five years, there’s going to be some kind of device the size of half an iPhone, which in one box gives you Xbox, PlayStation, mobile and PC experience; maybe there’s going to be streaming technology. So you don’t concentrate that much on the hardware -- because at the end of the day, this is just the porting process, which is in many respects technical. What you should concentrate on is experience; your gameplay experience: how people behave in the game. Does the game give them enough freedom for expressing themselves -- or destroying themselves (when you’re talking about military games), or Draw Something... for that kind of audience: gameplay experience -- and technological gadgets will be there to deliver that experience.
So we game developers and publishers must deliver the best possible experience, and experience being the best possible combination of, of course, the game itself, the graphics, the music, the gameplay, the storyline, and the way its serviced, the way you render customer support, the way you run the community, the way you position the game as cultural phenomenon -- comic books, TV series -- some games require that kind of support.
: Ok [laughs], that’s an unbelievable amount of information Victor. Thanks so much for your time today. Thanks for coming to Australia, and learning that we are very passionate gamers, and hopefully we’ll see some World of Tanks exploding here really soon.
: All right. We will.
: Ok. Cheers.