The Course, Mode and Future of the First Robox in the Metauniverse

Source: ForeChain

In 2021, a game company will be directly listed on the New York Stock Exchange. On the first day, the stock price will rise by 54%, and the company's valuation will exceed 45 billion dollars. One year after listing, the company's revenue will increase by 108% compared with the previous year. This company has the courage to go public directly. At the same time, it can maintain such a strong growth momentum in the highly competitive game field. Many people will think that it is a giant company with many popular games. However, this 18 year old company has only one game, which is loved by 95% of American teenagers,In 2021, the daily activity will reach 45.5 million times. This game is Roblox, a large-scale interactive game platform known as "the first unit of the meta universe".

About Roblox's Development and Future

Roblox is a global UGC game creation platform and interactive community, which is composed of three components: client, creation platform and cloud architecture.In 2021, the daily user activity will be 45.5 million, with a year-on-year growth of 40%; The total number of user participation hours was 41.4 billion, up 35% year on year; ABPDAU (average daily active user bookings) is USD 59.85; The annual pre order volume, that is, the total recharge amount of users to purchase the cryptocurrency Robux, increased by 45% year on year to $2.7 billion, far ahead of many popular games.

Although Roblox is a product of a game company, it has always been called a "game platform" by the public because it is very different from most popular games.The first difference is that Roblox is difficult to be classified into a certain type of gameFor example, strategy games or role-playing games, because there can be games of various styles and styles in Roblox, and the styles of these games depend on the users of the games, Roblox is more like a platform that gathers multiple games.On the other hand, Roblox does not engage in the business of making games, but provides tools and platforms for developers to freely create immersive 3D games.Leisure games in the platform are created by users themselves. Users can play games developed by others as players; It can also be the creator who develops his own game in the community for others to play. In order to reduce the creation threshold for users, Roblox provides three major infrastructures:Robox Client, Robox Studio, Robox Cloud。 Among them, Robox Client is a 3D application for ordinary users, which builds more than 20 million 3D digital worlds and supports the game experience of iOS, Android, PC, Mac, Xbox and VR; Robox Studio is a tool set that allows developers and creators to build, publish and run 3D content; Roblox Cloud is responsible for game virtual host, data storage, cryptocurrency and other businesses, and provides platform services and infrastructure for players, developers and content creators. All the tools in Roblox can be used easily. You don't need to have knowledge of game coding, just use your imagination and sense of design. Based on the needs of expanding user groups and in order to facilitate the use of users in other regions, Roblox has added more languages in the development process, which makes Roblox not only active in North America, but also popular worldwide.

Image source: Roblox official website

Roblox was a 2D physical experiment platform for education in its early days, so in addition to making a wide range of games, Roblox is also a learning tool for students around the world and a teaching aid for teachers. Many teachers will use Roblox to create interesting games or online learning courses to teach animation, coding and other courses. In terms of the layout of the education sector, Roblox invested 10 million dollars to make three educational games for junior high school, high school and college students. The three educational games are aimed at teaching robot technology, focusing on space exploration, and helping students explore careers and concepts in computer science, engineering and biomedical science.

Both game design, play and teaching assistance depend on Roblox's powerful interactive function. Users can meet, chat and interact with friends on the platform; You can also participate in social activities planned by others; You can also participate in classroom activities, and use props to design experiments to talk about professional theories with teachers. In recent years, Roblox has made use of its strong user social attributes to add many new product contents, including viewing nearby players, online conferences, PartyPlace, virtual concerts and other play methods. In October 2020, Roblox cooperated with Wave, an animation concert media company, to produce LilNas X ray concert performances, which further promoted the development of virtual social activities in the game.

Roblox's road to development

Roblox started with an idea. Dave Baszucki and his brother Greg founded Knowledge Revolution in 1989, which is a company that makes teaching software to let students simulate physics experiments. In the process of students' use, Dave found that students were more interested in building scenes such as car collisions and building collapses and creating games by themselves, which inspired the founder. In the process of becoming an angel investor, Dave noticed Friendster, a company that was earlier than Facebook and MySpace in social networking. Since then, Roblox has formed two core concepts: powerful creative tools and a broad social landscape.

Roblox was officially established in 2004, and the beta test was completed in 2006, open to all. Entering the millennium, it is a period of rapid development of large virtual worlds and game platforms. Various immersive social environment platforms and children's game platforms have emerged and quickly caused a new trend among young people. At this time, although the number of Roblox people is small, the community atmosphere is good, and users also encourage each other. In the early days of its establishment, Roblox adhered to a vision of giving users the greatest creative freedom and a good community environment. Therefore, Roblox did not put a lot of energy into game production and screen design during this period of time. The early released game images were rough, and the avatars in the test game floated like ghosts, which attracted many testers' complaints. Later, in 2006, the first version of Robox Studio was launched, so that community members could start making their own games. In 2008, Roblox stopped regular game production, because at this time, the creator community has developed to be able to create a large number of high-quality content, which is enough to support the activity of the entire community.

In 2009, Roblox upgraded the game with the money raised, and opened the road to commercialization. Roblox launched its own cryptocurrency "robux", which can be used to consume in stores or purchase members. After the release of Candy Crush Saga in 2012, it triggered a boom in mobile games. Roblox also followed the trend and launched its own application in ios. This year, Roblox users spent more than 21 million hours on the platform every month, becoming one of the most popular children's entertainment platforms. In 2013, Roblox completely opened the platform and released the developer exchange plan, allowing developers to convert their robux earned from games into legal tender. At the same time, Roblox also gives the creators the right to set their own prices, design business models, launch their own advertising and business cooperation, and even set up their own studios.

2016 is the 10th anniversary of the opening of Roblox and the beginning of a period of rapid development. Roblox has spread rapidly around the world, with 500000 creators. There are 5 million games on the platform. The head developer can earn 50000 dollars a month, and the MAU can reach 30 million. In 2017, Roblox brought about $30 million in revenue to all developers. In the same year, Roblox announced that host players can also play games with players from other platforms, truly creating a full platform game ecosystem from mobile phones, tablets, PCs, hosts and VR heads. From game content to platform equipment, the expanding coverage allows more players to participate in the game and create more content.

2019 is the 15th anniversary of the founding of Roblox. On August 2, Roblox announced that it would become more than 100 million yuan every month. On February 26, 2020, Roblox completed round G financing of US $150 million, led by Andreessen Horowitz's Late Stage Venture fund, and participated by Temasek and Tencent. On November 6, Roblox officially crossed the 2 billion user barrier. Interestingly, the account that completed this feat was proved to be a robot. On March 11, 2021, Roblox was listed on the New York Stock Exchange. On the first day of listing, the closing price rose 54.4%, the closing stock price was 69.50 dollars, and the company's valuation exceeded 45 billion dollars.

Core user group - Generation Z

From the development of education software at the beginning to one of the most popular game entertainment platforms for children in the later period, Roblox's growing strength is inseparable from its most loyal user group - young users. The reason why Roblox can firmly grasp the attention of such users is closely related to user characteristics and its own characteristics.

Many people will think that children have no ability to pay for games. Most children's playing time and ability to pay will be limited by their parents. However, a survey in 2019 showed that American children can spend 15 billion dollars on games every year, 1500 yuan per person for six months, and this group accounts for 24% of the American population. In six months, the average per capita consumption of children's entertainment in the United States was $647, with games being the most expensive area, reaching $216.54. In other words, if you want to reach the top of the American game market and maintain a high position, you must seize the young generation of users, and Roblox has firmly mastered this group.

Image source: Internet

In terms of game duration, games are just a part of contemporary children's collective life. According to the survey, their average weekly game time is nearly 12 hours. Mobile and home console are the most important game entertainment devices, with the former accounting for 4.8 hours and the latter accounting for 5.4 hours. According to their survey over the past seven years, this data has been increasing year by year. In the previous years, the total time of the two devices was 8 to 9 hours, which shows that games are taking up an increasing proportion of children's lives. According to the public data of Roblox in 2021,Roblox has nearly 50 million DAILY active users in 180 countries and regions around the world, an increase of 53.37% over the 32.6 million DAILY active users in 2020, of which Generation Z users account for the largest proportion.

  It can be seen that children have enough ability and time to pay for games, but the premise of consumption is to conform to children's interest orientation and satisfactory game quality. Different from the early stand-alone games, the Internet provides more choices for children. They prefer cooperative experience and exploration rather than following the plot to advance the game. In fact, this phenomenon is not only in the United States, but also in China. Many children like sandbox building games very much, and they are happy to create their own buildings. In this regard, Roblox perfectly conforms to the children's orientation towards games. It makes games alone or with partners using simple construction tools in the platform, and can also invite familiar friends or unfamiliar tourists to participate, so as to obtain sufficient fun in production and experience. According to the public data of Roblox in the second quarter of 2022, the daily activity of users under 13 years old is 24.2 million, accounting for 13% of the total. It can be seen that the proportion of children users is high. In addition to the development of the Internet and mobile terminals, the epidemic also forced children to go out of the classroom and stay away from friends. The children turned to Roblox, where they could conduct virtual social networking, browse theme parks, participate in concerts and play action games, and also use its popular text chat function to keep in touch.

Image source: Roblox official website

The core user of Roblox is Generation Z. While attracting children under 13 years old, the number of users over 13 years old is also increasing gradually. The population aged 17 to 24 is the fastest growing user group. Between 2020 and 2021, many popular games will consciously begin to attract older users, and users over 17 will gradually appear in the games. For example, in 2021, more than 40% of the ten most visited games on Roblox (such as All Star Tower Defense, Blox Fruits and Shindo Life) will be over 17 years old. Different from children users, young users will also participate in numerous interactive activities of Roblox and other brands, including Twenty One Pilots concert, fantastic Gucci Garden and Vans World's large skateboard park. The number of visits to these activities reached millions, and the number of visits from users over 17 years old was close to one third (or more).

Image source: Roblox official website

At present, the fastest growing user group of Roblox is people aged 17 to 24. Therefore, the Roblox developer community hopes to cope with this expanding market through fresh content and diverse experiences, especially amazing visual effects. This phenomenon can be seen in the following games: the fantasy role-playing adventure game "Deepwoken" focusing on solving puzzles, the fast-paced "riding simulator" and the dynamic "Rolling Thunder" that developers have demonstrated in DEMO and will soon release. Like "Phantom Forces" and "World//Zero", these two games have more older game content, so more than 40% of their fans are over 17 years old; For the game "Deepwoken", 60% of the fans are over 17 years old.

Unique business model

The business model of Roblox is very unique. Different from traditional game companies, it does not rely on professional teams to produce large-scale games. The company is mainly responsible for the construction and maintenance of the platform. The platform consists of three elements: Roblox client (covering PC, mobile and host), Roblox Studio and Roblox Cloud. The creator uses Roblox Studio to create games, sell and distribute them to users on the client side. To facilitate developers, Robox Studio provides a set of tools for novices to professionals. Therefore, the developer ecology is the foundation of Roblox, which provides enough creative space and technical assistance for high-quality developers, cultivates enough high-quality developers in the platform and maintains high activity, continuously produces a large amount of high-quality game content, attracts more players to pay and more new developers to join, thus forming a virtuous circle and establishing a positive feedback mechanism.

The main cost of Robox is the revenue share of creators. As a game company, it can not only save the development cost of professional game teams, make its cost side structure significantly better than that of other peers, but also ensure that the content of the platform is new and rich enough to keep up with the fashion trend. Roblox's revenue mainly comes from the user's expenses on the platform, mainly including:1. Member subscription service; 2. Paid game purchase; 3. In game virtual goods sales.The business in the game world is built on the economic system based on the cryptocurrency Robux, which is the core of the Roblox business model. Robox is a virtual currency in the platform. Players and developers can trade with the Robox platform or with a third party in a fixed proportion. Robux is different from the current blockchain token. It can exchange real currency with the platform only after reaching the income threshold. Players exchange for Robux to subscribe to Roblox members, buy games, buy in game, buy avatars at Avatar, etc; Developers obtain Robux through the sale of games, the accumulation of game users' time and the sale of virtual props in the game, and convert it into real currency; The Roblox platform draws a percentage in each transaction link, and sells advertising spaces and development tools to developers with the price of Robux. In the second quarter of 2022, the subscription volume of the cryptocurrency robux will reach 639.9 million dollars. After players buy robux currency, they will consume it through the channels of pay to win and pay to cool in the game. The platform will get 55% of the share. Roblox has realized "making money lying down" and the profit rate is considerable.

Roblox brings together many users of different interests, regions and ages, so the "user range" is far richer than other platforms, which is one of the reasons why many game developers choose to come to Roblox.As developers want their games to receive more attention and higher popularity, publicity has become a very important link, which leads to another important source of income for Roblox - advertising. At present, the relatively mature advertising system in Roblox is designed for developers to promote their own games, and it is displayed in three forms: banners, skycrapers and rectangles. With Robux as the bidding unit, each round of advertising will last for 24 hours, and the advertising exposure rate will be determined by the bidding system during that period. After the outbreak of the epidemic, Roblox joined the game of viewing nearby players, online meetings, party places, virtual concerts, etc., which further promoted the development of virtual social activities in the game. The activity of virtual social activities in turn increased the stickiness of users in the Roblox platform. During the epidemic, the use of Roblox grew rapidly, making Roblox an ideal brand marketing platform. Although marketing through games is not an innovative form for brands, with the support of the concept of "meta universe", games will create more possibilities for brands to go out of business and attract more young users' attention. Roblox has implanted an experiential game for the toy brand "L.O.L.". In the game, users can go to the official surprise party of "L.O.L." to better understand the attributes of toys in the brand and experience the fun that the brand can bring to users. According to the data provided by Roblox, L.O.L.'s official surprise party experience has successfully attracted potential users, and the average game time is usually 15 minutes, which has greatly helped the brand exposure. From this, we can see that advertising revenue is expected to become the future revenue increment of the Roblox platform.

Image source: Roblox official website

Creator's Paradise

The difference between Roblox and other games is that UGC game content accounts for a relatively high proportion in the platform, which has a more perfect UGC content ecosystem. The two core issues of UGC content ecosystem construction are: 1. Trigger users to create content; 2. Encourage platform users to form UGC content creation self cycle.

How should users be triggered to create content? This requires the platform to provide users with simple and convenient authoring tools and incentive mechanisms for creative behavior. Because most users of Roblox are children, the instructions and tutorials for creating tools are very detailed, and beginners are guided to develop and create game experiences through self compiled courses. At the same time, Roblox also encourages third parties to write their own tutorials and strategies to improve the audience's acceptance of Roblox.

Image source: Roblox official website

The incentive mechanism has always been considered as one of the main reasons why Roblox is popular. The developer exchange plan (also known as DevEx) allows successful Robbox developers to convert their earned robux into real currency. Successful developers can pass the DevEx member certification and earn real currency. Roblox's reward mechanism is very clear. Players buy robux for various paid games and props in games, and 25% of these fees are paid to application stores and other channels; 22% of the revenue from various platform costs such as server operation and promotion operation; 35% collected by Roblox; The remaining 18% will be given to the creator. Such a creator reward mechanism allows more players to begin to try and love creation. In 2021, the number of new creators who first used Robbox Studio, the free immersive authoring engine of Robbox, has increased significantly by a three digit percentage compared with 2020. The corresponding annual income of creators is also growing. From the second quarter of 2019 to the second quarter of 2022, the income of developers is growing by 514.16%

Image source: Roblox official website

For users, Roblox is both a game platform and a creation platform; For Roblox, users are both players and content creators. At the creator level, creators design games through their own technologies and ideas, gaining more and more recognition and rewards from players, so as to continue to create newer and more interesting content. At the player level, by experiencing different games, we can share or pay for high-quality game content, so that more people can pay attention to our favorite games. This enthusiasm will also be fed back to the creators, encouraging them to continue their development, and further promoting the innovation and enrichment of games in Robox.

Next stage: Metauniverse

After understanding the operating structure and business model of Roblox, it is not difficult to find that Roblox is not just a simple game or game platform, and Roblox has already defined its own development - the meta universe. As the first game company to write the concept of Metaverse into the prospectus, Roblox Metaverse has eight characteristics: identity, friends, immersion, low latency, diversification, anywhere, economic system and civilization.

  • Identity.All users have unique identities in the form of avatars, which are freely chosen.

  • friend.Users interact with friends, both in the real world and on Roblox.

  • immerse.Roblox's experience is 3D immersive, and with the continuous improvement of Roblox, it is gradually indistinguishable from the real world.

  • Everywhere.Users on Robox come from all over the world.

  • Low latency.Users can enjoy the experience on the platform for free, or quickly travel through different game experiences with friends.

  • diversification.Roblox is a large and expanding world of developers and creators building content. These experiences range from simulated construction and operation of theme parks to adoption of pets. Users are also increasingly rich in their imaginative designs.

  • Economics.Roblox's economy is based on a currency called Robux. Developers and creators can convert Robox back into real world currency.

  • Civilization.Many systems are designed to enforce real-world laws and to exceed minimum regulatory requirements.

Dave Baszucki, CEO of Roblox, mentioned that users are the creators of the meta universe, while Roblox is just a "shepherd" role that provides creation tools, realizing the decentralization of game content ecology. Such an idea made Roblox start to separate from such keywords as "children" and "education", forming a mature, feasible and promising basic framework that caters to the market's imagination of the meta universe.

Image source: Roblox official website

This basic framework includes: social networks, economic systems and virtual scenes. The economic system based on robux and the social network based on UCG community are gradually developing and improving, while the layout of the VR field is the "key" to open the meta universe. Since 2016, Roblox has allowed users to design and experience VR games on the platform, and realized the cross platform and cross device use of VR games. Players can play games through computers, mobile phones, Xboxes, and Oculus.

Future development

In the epidemic era, children and teenagers were mostly at home, so the scale of Roblox users grew rapidly during this period. With the slowing of epidemic measures in Europe and the United States, the growth of Roblox users is bound to slow down. Even if all indicators are lower than the outside expectation, the company is still optimistic about the situation after the epidemic measures are slowed down. In the 2021 shareholder letter, the company mentioned that it chose to give up quarterly performance guidance and pay more attention to long-term value creation, and pointed out three key goals: developing the international market, attracting older users, and expanding the application range of the platform.

Image source: Roblox official website

The range of users of Roblox has expanded from Europe and the United States to the whole world. In the list published in 2021, it can be found that users from Europe and the United States, Asia and South America are increasingly interested in Roblox. Users in the countries listed in the list have spent hundreds of millions of hours in Roblox, and the time in the top seven countries even exceeded one billion hours.

Image source: Roblox official website

According to the data disclosed by Roblox in the second quarter of 2022, the user activity in the Asia Pacific region is growing rapidly. The market in the Asia Pacific region is in its infancy, which will be the key point of Roblox's growth in the future.

While breaking through the international market, it is also necessary to attract older users and expand the application scope of the platform. Roblox chooses to cooperate with different brands and platforms. For example, Roblox announced to cooperate with the National Football League of the United States to expand the influence of the meta universe through NFL TYCOON EXPERIENCE, and continue to learn the value of interactive sharing experience to NFL.

The development and positioning of Roblox comes from the original teaching software, so Roblox will always adhere to the development of children's users and education. Roblox Education Association assists and expands the current teaching behavior in Roblox Studio and Roblox platform, aiming to have more than 100 million students learning on the platform by 2030. In November 2021, Roblox announced that it would invest 10 million dollars in non-profit organizations to develop three educational games, focusing on teaching robotics, space exploration, and helping students explore careers and concepts in computer science, engineering, and biomedical science, respectively for junior high school, senior high school, and college students. This is the first time Roblox has invested in educational games.

summary

As the first unit of the meta universe that has developed for more than ten years, Roblox has brought significant impacts to the game ecology and meta universe industry. It is not only a game, but also a game platform where developers and players coexist. It is also a vision of the future meta universe with strong social attributes and unlimited potential. The UCG global virtual content community built by Roblox is also an imagination of the future Internet. Users provide demand and create content, thus driving the development of the entire community. Meet the needs of different groups for social interaction, entertainment, work, learning, etc., break the barriers of space and time, let more groups integrate, burst out new sparks, and constantly improve their own meta universe.