Business Model | International Markets | Interview

Interview: Nival Returns to the U.S.

Nival general manager U.S., David Christensen
Nival general manager U.S., David Christensen

APRIL 28, 2011 • Five years ago Nival Interactive became the first Eastern European game company to set up shop in the United States. The Moscow-based developer had got its start in 1996, and in the 10 years hence, had developed and published a number of successful properties under its belt including: Rage of Mages, Evil Islands, Etherlords, Blitzkrieg, Silent Storm, and Heroes of Might and Magic V. Control of the company had also passed during that time from its original founder Sergey Orlovskiy, to the Ener1 Group holding company.

It was Ener1 that sought to ride the next wave of console introductions in 2006 to worldwide fortune via moving its headquarters to Los Angeles that year in a splashy introduction, and hiring on a U.S. executive team headed by Xbox alumnus Kevin Bachus as chief executive. Orlovskiy remained as president during this period.

Nival’s American console experiment fizzled, however. Within a year, the company was in the throes of a major restructuring that culminated in November 2007 with a deal between Ener1 and Orlovskiy that returned full control of the company to its founder. The L.A. operation was shuttered and headquarters operations returned to Moscow.

In the years since the company has moved on and not looked back. Nival Interactive remains a big player in the strategy PC gaming segment, but the reformed Nival Group has since poured its efforts into building a substantial online business in its home market with its Nival Network. The division’s ZZima. com online network is often described as the largest MMO operator in Russia, and has licensing agreements with partners such as China’s Shanda Interactive Entertainment. Nival Network’s most recent development project is Prime World, an MMO that blends Diablo-style action with real-time strategy elements.

NIVAL LOGO-SAmidst this flurry of activity in Europe, Nival Network made a stealthy return to Los Angeles in 2011. Without fanfare, a U.S. office was opened to pave the way to opening up the North American market to the division’s online game portfolio. David Christensen, previously with Vivendi Universal Games, came on board to run the Los Angeles operation as general manager, U.S.

DFC has been building data on the worldwide online game business for more than a decade. While the movement from East to West of the games as a service model is well documented in the examples of South Korea and China, less well known is the growing migration of content westward from Eastern Europe and India. Nival’s reintroduction into North America is, therefore, of great interest. In a two-part series, DFC will first discuss the new L.A. presence with Christensen, and will get a more international perspective on Nival with founder Orlovskiy in a subsequent Dossier interview.

DFC: So give us the big picture overview of Nival’s new U.S. office.

David: Right now, we’re solely focused on operating titles developed by Nival. This includes the typical operating roles – user support, community building, marketing, PR and some North American specific business development. Our goal is to introduce gamers to our social strategy titles and support these titles by offering the best possible user experience for North American gamers.

DFC: When was the decision to launch this new branch made, and why was Los Angeles chosen versus other game industry hubs like San Francisco or Montreal?

U.S. strategy gamers are already well familiar with Nival PC franchises such as Blitzkrieg.
U.S. strategy gamers are already well familiar with Nival PC franchises such as Blitzkrieg.

David: Personally, I love L.A. so I couldn’t think of a better place to launch a new online games company. There’s a solid recruiting base here in the online gaming space and we believe it’s the best fit for where Nival wants to go as a company here in North America. But mostly, I just wanted to be able to tell the folks back in Moscow that it was 75 degrees in March while they were driving through the snow.

DFC: What sort of growth do you anticipate out of the North American office during its first year?

David: This first year, we are solely focused on Nival’s titles and the emphasis for the team is to operate Nival’s games at a high level for the American audience.

DFC: The Los Angeles office is just emerging from its stealth mode. How fast can we expect this branch to grow from the tight launch team you have now, and what expertise will you be adding down the road?

David: We’re committed to adding more employees but currently, the focus is on making sure our games are ready for this market. We have very strong operations in our Minsk office, so we will lean on them heavily, but as we get closer to launching games in North America, we’ll also add talent on the ground here to ensure that we are properly servicing our North American users.

DFC: This isn’t the first time Nival has come to America, or Los Angeles. How has that previous L.A. experience affected the company’s industry credibility, and job of starting up another office in North America?

David: The office that was previously opened in the U.S. was primarily focused on development. The current North American office is focused solely on publishing and operations, so the existence of the previous office truly has no effect on the current operations. Our mandate today is to publish and operate fun, social strategy games.

DFC: Why is now the right time for Nival to engage the North American gaming market?

David: Nival has developed games in the past that were well received in North America. However, these were retail products and as you know, the barrier to entry in retail is quite high. Today, with digital distribution and social networks, we are able to self –publish Nival titles without incurring the exorbitant expenses and hassles associated with boxed products.

DFC: Which consumer demographic in North America is already aware of Nival and its strategy games, and why?

Nival is bringing its Prime World MMO to North America.
Nival is bringing its Prime World MMO to North America.

David: We are finding that there is a base of core gamers who are quite familiar with Nival, as Sergey Orlovskiy (Nival’s founder) and his team have been developing strategy products for over a decade. Many of Nival’s titles have been well-reviewed, so we are hopeful that North American gamers have a positive impression of our past work. We believe our shift to social strategy will re-engage many of the North American customers that have enjoyed Nival’s titles in the past.

DFC: What kind of reputation do Nival games have in North America, and why?

David: Blitzkrieg, Silent Storm, and Heroes of Might & Magic V are all well-respected, hardcore strategy games. I feel as long as we can maintain the same level of quality – and hopefully, improve on it – North American gamers that have enjoyed Nival’s games in the past, will find a lot to like about our new titles.

DFC: How do you intend to leverage those American gamers already aware of Nival to reach a larger audience?

David: Great question. We’re still working out how to make sure they’re in the fold right away and we’re hopeful this awareness will drive some foot traffic to our booth at E3, which will be a first for the company. We hope to reach out to previous Nival gamers to create a community interested in fun strategy games but to also find an expanded user base that enjoys the social elements of games and appreciates how their real-world relationships can actually benefit from online entertainment.

DFC: You mention social networks, so how does Nival’s plans for North American operations fit in with existing social networks?

David: Social networks are at the core of our strategy. All of our games feature social gameplay elements and all will feature, at the very least, core elements of the game on social networks.

DFC: Will we see ZZima in North America?

zzima-SDavid: is a very popular social network for gamers in Russia, however at this time, there are no plans to expand its reach to the States.

DFC: Is part of the American game plan for Nival to seek expansion into Latin America?

David: Long term, we are very interested to explore Central and South America but for the immediate future, this office is 100% focused on the North American market.

DFC: Can we expect to see your office working with such popular Nival published franchises as Cabal Online, Dragonica and Seven Souls here in North America, or completely new IP?

David: The titles you’ve mentioned are all licensed properties that we operate in the Russian territories. Our focus in North America will be on the publishing and operation of games developed only by Nival. When we look at the market, we believe strategy games have plenty of room to grow. Before the online market took shape, strategy games made up nearly 35% of the market, compared to just 10% for RPGs. We believe strategy games have been under-developed and it is our aim to create engaging social strategy games.

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