Winning Space Game Biz Model

Winning Space Game Biz ModelSam Dinkin, Ph.D.

CEOSpaceShot, Inc.

www.freespaceshot.com

What have we done since last Space Access?

Validated math and science excitement amongst players Validated ad model Validated value proposition Comprehensive marketing survey Test marketing at air shows, sci-fi conventions, space conventions, schools, on the internet and in media Launched freespaceshot.com Offer free opportunities to win trips to orbit, trips around the Moon, scholarships and ZERO-G airplane flights

Market Opportunity

From 8/24/06 white paper updating2002 Futron Study Conclusions

Suborbital Spaceflight Industry Revenue without Games

Suborbital Spaceflight Industry Revenue Doubled with Games

0

50

100

150

200

250

300

350

400

450

500

$mill

ions

..

2008 2009 2010 2011

Suborbital Industry Revenue with Game Demand

98% of families make less than $250k/year and cannot afford full-pay flights at first Financing for flights has poor availability and games are self-financing US suborbital games opportunity $125M 30% growth

Relevant Acquisitions

Fun Games $400 million (operates Virgin Skill) Now 30 million players

IGN $600 million 23 million unique users per month 2005

Skype $4 billion 54 million users when purchased, now 100 million users

You Tube $1.67 billion 20 million unique users per month

Suggests subscribers worth $13-80 to Space Shot if Space Shot sells the company

Market Positioning

Positioning of pay game

0%

20%

40%

60%

80%

100%

<8 8-12 13-16 17+

ExcitedComputer Access

Computer ProficiencyCredit Cards

Available Time

Probability of play can be expressed as f(E*CA*CP*CC*T)

Kids excited, but have no means to pay. Adults have means to pay, but...

Positioning of free game

Kids most interested Pre-sold on space

Parents say “you can be an astronaut”

Kids have most time available

Tweens (8-12) have computer access and computer proficiency and are most excited about the game

Positioning

0%

20%

40%

60%

80%

100%

<8 8-12 13-16 17+

ExcitedComputer Access

Computer ProficiencyAvailable Time

Probability of free play can be expressed as f(E*CA*CP*T)

Ten times higher demand than pay game

Evolution 2008-

Once there are flights and winners, 17+ players will become more interested

New games needed to address all markets

Free drawing

Free poker

Competitors

Virgin Volvo 2005 Giveaway 130,000 players expendable

Microsoft Rocketplane Vanishingpoint Game 88,000 players expendable

Texas Lottery 7 million players, $3.4 billion annual revenue

Party Poker $1 billion 2005 revenue credit card pay illegal

Revenue Model

Revenue = Players * frequency * ad rate * ads per play We are acquiring players at about $8 per player and trying to get that down to $2.50 per player Frequency for our 2000 players is approximately one play per month (13000 plays made). Trying to get that to 90 per day. Ad rate is $0.60/thousand (CPM)—business model works at $0.35 CPM and lower if we add milestones. Can get CPM to $15 for interstitials and $2-$3 for banners with 200,000 players

Need 1 million players (10% of kids 8-12 in US) for a year at 90 plays per day to award $300 million flight for two around the Moon

Cost model

Operations Servers: $550/month

Call center: $300/month

Operator/referee: $800/month

Promotions: $120/month

Capital Technical Services: $3000/month

Advertising/Marketing (above replacement): high Volvo-Virgin, Microsoft: $12-20 per player

Early to Market

RpK not yet flying Rocketplane XP or K-1

Constellation Services not yet flying

Bigelow not yet flying passengers

Business Goals 200,000 daily players by 2012 Subscriber acquisition cost down to $2.50 per player New languages

Spanish 2008Japanese 2009

New games Free Drawing 2008

Instant game requires hole-in-one insurance (3x players for same profit)

Free Poker 2010

New non-space prizes Personal space is 3 parts in 10 million of economy Cars are 1/25 of economy 2007 Houses are 1/6 of economy 2008 Cash is 100% of economy

Reach goals

More investors

School fundraising sales

Corporate sweepstakes sales

How can you help?

Tell your computer teacher friends who teach to kids 8-12 that we have a free lesson plan