Freedom Holding Corp (FRHC)

[Quintessence]

Every fall, Freedom Finance IC organizes a large conference for investors - the FFin Conference. This year the event was held on a special scale: the key topic of discussion at both sessions was investment in entertainment. The experts who spoke at the forum and their listeners wondered how to make money on emotions.

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“In order to be a leader, you must be brave enough to change the global rules of the game,” said Timur Turlov, general director of Freedom Finance, generalizing the discussion about who ruled the market today.

The first session was devoted to a relatively new, but very dynamically developing area of ??the entertainment industry - online games and e-sports. Panel experts: Ilya Karpinsky (Mail.ru Group), Roman Dvoryankin (Virtus.Pro), Vladimir Makarychev (EnplexGames. Wargaming Alliance), Fedor Fetisov (Winstrike), Alexander Sokolets (Neurogaming Group) and Vadim Merkulov (Freedom Finance Investment Company) ) - gave their assessments of the e-sports and gaming industry, discussed the market potential, as well as the investment attractiveness of the main players and issued an unambiguous verdict: e-sports and online games will continue to delight not only fans, but also investors. The moderator and the real engine of discussion was the famous sports commentator Vladimir Stognienko.

The first in the session was Vadim Merkulov, director of the analytical department of Freedom Finance Investment Company. According to him, new formats are constantly appearing in the dynamically developing sphere of computer games. Interestingly, today, game providers are abandoning the original format - the direct sale of games to users. In-app purchases are becoming a much more popular monetization model. Global revenue from in-game purchases, according to Vadim Merkulov, will double by 2020 compared to 2018 and amount to $ 71 billion. The expert noted market leaders - Tencent, Microsoft, Apple, Sony, Activision Blizzard, Take Two Interactive, Electronic Arts and others.

The company’s analyst also gave a general forecast for market development. The gaming industry will continue to expand, and the growth driver for it will be a segment that many people underestimate today - mobile games. Esports as a phenomenon is also able to stimulate further positive dynamics as the number of spectators and professional players increases. Monetization, according to Merkulov, will go towards the subscription model, which is already actively used by the largest market players - Apple, Google, Samsung.

As part of the ongoing discussion, participants discussed the success of online games and e-sports and what the future holds for them. Experts emphasized that, contrary to popular belief, the e-sports and online gaming audience is not limited to the younger generation. In some segments, the average age is 35+, and the main consumers are women.

The trend towards industry professionalization is also noticeable. According to Roman Dvoryankin, Virtus.Pro General Manager, e-sports is still far from big offline sports, but the trend is obvious: “If we talk about the top e-sports teams that play on the world stage, then the salaries of e-sportsmen are (if we talk about Russia and Europe) $15-20 thousand per month. There are situations when former cybersportsmen can become streamers and start earning more. ”

At the same time, experts agreed that e-sports is not a threat to traditional sports and it is unlikely that in the foreseeable future it will be able to supplant football or hockey. But its institutionalization, without a doubt, will continue.

As Fedor Fetisov, Winstrike Strategic Leader, emphasized: “eSports is the core of the gaming industry. In general, this is such a quintessence of everything that happens. Of course, the industry is huge. But here are the most vivid emotions, the highest quality collaborations. This is an indication of how cool the industry can do. ”

In the final part of the session, experts answered questions from listeners and journalists and made recommendations on investing.

The second session “TV and film industry. How to make a product from the media and sell it on the stock exchange ”began with the opening remarks by discussion moderator Sergei Minaev, editor-in-chief of Esquire magazine. Content rules everything, but how to create it, how to sell it and how to identify the consumer - these are the invariable issues of the TV and film industry.

Timur Turlov, Director General of Freedom Finance Investment Company, presented his vision of the issue. According to him, the content, like the entire entertainment industry, goes to digital, where it already receives more than half of its revenue. Traditional TV is finding it increasingly difficult to compete with content produced by Netflix, HBO, Apple or Amazon: television does not keep pace with the changing delivery formats for this content.