eResearch | Kuuhubb Inc. (TSXV: KUU) announced today the soft launch of its newest game, “Tiles & Tales”. Kuuhubb focuses on digital entertainment and casual eSports targeting the female demographic. Tiles & Tales is a combination of two genres of gaming apps – Match-3 and Visual Novels – two very popular genres within the female gaming community.
Kuuhubb CEO Jouni Keränen commented, “Tiles and Tales is our flagship second-generation game and Kuuhubb’s key focus in calendar year 2020. I am extremely proud of our talented development team for all the dedication, hard work and love they have poured into the game. I am confident that this is the beginning of a new long-term franchise and an important growth driver for Kuuhubb in the future.”
Match-3 Video Games
A “match” game is an object-matching video game, where a player manipulates objects such as tiles or jewels or balls, in order to make them disappear when they “match” a certain criteria. Tetris, a popular video game from the 1980’s, was one of the first tile-matching video games. In a Match-3 video game, the number of objects is three. Match-3 games are the most popular genre with female gamers and, according to HubSpot, 69% of Match-3 players are women.
Visual Novel Games
A visual novel is an interactive video game genre, which resembles a mixed-media novel. It features a text-based story with user interactivity and visuals, including stills, animations and videos.
Merging Match-3 with the Visual Novel
According to Kuuhubb, Tiles & Tales will be the first video game to merge a Match-3 game and an interactive visual novel. Kuuhubb’s market research showed considerable overlap among female players and the Company believes there will be crossover appeal and fans of both genres will find Tiles & Tales engaging.
In addition, according to Kuuhubb, Tiles & Tales introduces new game mechanics that will set it apart from other Match-3 games and the Visual Novel component will add different narratives, from solving a murder to enjoying a romantic vacation, which will appeal to different players.
The Match-3 Market
According to Kuuhubb, some Match-3 games generate revenue in the range of US$25-50 million per month. Candy Crush is one of the most well-known Match-3 apps and, with over 90 million players, is one of the top-grossing mobile games in the world (across all genres), due to in-app purchases of its virtual goods. In 2019, Candy Crush gamers spent over $1 billion on virtual goods that included extra moves, colour bombs, and lollipop hammers.
Interest in the Match-3 sector has also led to consolidation with Israel-based Playtika acquiring Helsinki-based Seriously Digital Entertainment for a reported US$275 million, at a multiple estimated at 4x revenue, and San Francisco-based Zynga acquiring Helsinki-based Small Giant Games for US$700 million, at a multiple estimated at 23x revenue.
Availability
Kuuhubb’s new Tiles & Tales match-3 game is now available in the App Store for iOS devices and Google Play for Android devices in select countries: Finland, Croatia, the Netherlands, Philippines and Australia. Global commercial launch is expected in the second half of this year.
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| In February, eResearch initiated coverage on Kuuhubb Inc. with a Buy rating. In early March, we increased the one-year price target to C$1.90/share.
You can download the full 32-page report by clicking here: eR-KUU-IR-2020_02_18-FINAL2 |
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