Jun 05, 2020 (AB Digital via COMTEX) -- The multi-billion-dollar mobile gaming and app industry is consolidating and Kuuhubb Inc. (OTC: BCDMF , TSVX: KUU.V), an exciting company that is targeting the roughly one billion female gaming market, may be earning some attention. Moreover, this niche-based company already has several top-rated games in the market.
Kuuhubb believes that targeting the roughly 46% gamers in the market that are female can become a lucrative proposition, and is attacking that opportunity by bringing top-rated match-3 games to market. The company’s flagship game, Recolor, experienced a rise of 214% in its Android Monthly Active Users, resulting in over 30% growth of Recolor Android revenue for March 2020. Tiles & Tales, the company’s second-generation flagship game, is the first to merge match-3 games and interactive visual novels, intending to capture a larger audience size and simultaneously introduce players to another popular gaming genre. And, Kuuhubb’s Recolor By Numbers, a leading coloring app, recently reached a Top 10 spot in Apple’s Top App charts. Other popular titles include My Hospital, and Dancing Diaries.
In addition to popular games, Kuuhubb is also entering a global esports market that has been on a significant uptrend. Newzoo, a games and esports analytic firm, forecasts that the worldwide esports market will likely top $1 billion for the first time during 2020. According to their most current data, players in China are leading that growth, followed by those in North America, who have contributed to a year-over-year growth rate expected to eclipse 15%.
In terms of revenue, Newzoo expects that the Chinese market will deliver roughly $385 million in 2020 revenues, followed by North American players contributing an estimated $252 million toward the $1 billion total global contributions. That revenue may find a new channel for growth from the recent attention given to the online streaming market due to the COVID-19 pandemic.
Esports Projected To Bring Substantial Advertising Interest
Kuuhubb is positioning to take advantage of a new space as the live events become more mainstream. Online platforms, like Twitch and YouTube, are helping to bring events straight to the consumer by allowing esports streamers to broadcast game-play. Sector analyst, Influencer Marketing Hub, cited data from TwitchTracker, which shows Twitch seeing a more than 116% increase since 2016 in the number of people who watch live streams, with the 2019 totals showing a jump to more than 1.28 million watchers.
If the benefits of an online event get proved, more nimble companies, like Kuuhubb, may be able to seize an advantage. Moreover, with Newzoo reporting that in the third quarter of 2019, the top 10 public companies by games revenue made a combined $21.5 billion, the opportunity can be massive. No doubt, however, Kuuhubb needs to be smart in its approach, especially when playing against companies like Take-Two Interactive (Nasdaq: TTWO ), Apple (Nasdaq: AAPL), and Tencent (OTC: TCEHY).
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Kuuhubb may be positioned to earn attention from an industry that is consolidating. And although the company has never hinted to be on the market, its valuation may benefit from the deals getting done. Zynga Inc. (Nasdaq: ZNGA ) agreed to purchase Turkish mobile-game maker Peak for $1.8 billion. The terms present the highest acquisition price ever paid in the sector and is a product of a changing global environment where staying at home has become a necessity due to the global COVID-19 pandemic.
The deal has raised eyebrows in the industry. Not only has consolidation between competing companies increased, but so has the price tags associated with the purchases. Kuuhubb, like in that deal, can bring a new class of assets to a suitor. Analysts that are evaluating the agreement say that the acquisition comes at a time when video-gaming companies and their users, are looking for both video and audio streaming entertainment to replace live-sports telecasts. Kuuhubb, too, is combining separate types of gaming into one user experience.
Valuation may come from an overall spike in demand caused by the global pandemic. Glu Mobile (Nasdaq: GLUU ), another leading developer and publisher of mobile games reported significant momentum in the business and broad-based growth across its live game portfolio. Kuuhubb is working hard to experience the same type of growth on a percentage and user growth basis.
Finding New Gems
While the giants of the industry grab most of the esports sector attention, the shift toward online streaming may benefit smaller companies that have a more agile ability to adapt to fast-changing consumer demands. Admittedly, COVID-19 has upended the industry, but it has also exposed the opportunity from shifting the model toward a more online approach.
But Kuuhubb has its advantages as well. They have an inherent ability to add content to already published games daily, giving them a unique ability to leverage their more than seventy person team to effectively navigate the barriers of entry to the esports sector. An even bigger advantage to the smaller Kuuhubb is that they may be able to navigate the changing esports market more efficiently than larger players. Thus, by taking advantage of speed, Kuuhubb may enjoy an ability to quickly shift strategy as the esports community changes direction as a result of COVID-19.
Hence, being bigger is not necessarily better. In the battle for viewership, Kuuhubb’s compelling content and vibrant graphics may add a unique advantage for Kuuhubb to develop its esports ambitions toward its female-oriented user base. That could add to the traction already in place for its games and apps.
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