Fantastic analysis, Christopher! So much great information to process here. I work as a sound designer, so I have always been impressed in working with Unity for spatialization techniques and virtual modeling of physical/acoustic spaces. Amazing to learn about so many other possibilities with this software, especially in the Metaverse space! I am just starting to learn about that and WOW. Did I understand you correctly in the conclusion that Unreal says that Unity will be one of the main founders of the metaverse? Thanks so much <3
Hi Brian - thanks for the kind feedback! Correct, that is what I learned from an interview of Matt Ball. While I couldn't find an exact quote, Tim Sweeney is very clear in his interviews that Unity will play a role.
Tremendous work of research. It took me a lot of time finishing the article, so I would be curious to know, how much time did you (guys?) put in completing the research
It's just me (I say we, writing from the company's perspective). It takes a lot of time - I'm trying to constantly refine my process to be more efficient. But it requires a thorough deep dive into the company and industry. I started the research back on October 20th and worked at least half days on it almost every day since.
I have a couple of questions: 1. The main revenue resource for U is ads, in the ads world, it doesn't process any pricing power, which is mostly obtained by Google, FB, AAPL, TTD etc. I think it will be an okay investment vehicle, but does it have enough Moat? 2. The customer it's helping should belong to SMBs, it's hard to tell if their rev is recurring, I'm afraid the churn rate is high, although there're always new customers, yet its' mainly due to the tail wind in the gaming industry, but that doesn't warrant the moat to invest the company in the long run? I am skeptical of the company's moat to sustain in the longer term, although there're impressive technologies involved
This was a great write up - nice work. Id be a bit careful on the assumptions that developers only use one or the other (unity or epic). I’ve spoken to a few developers who have use unity for one range of games and then switched to epic for the next (or vice versa)
Agreed - there are examples of those who will use one or the other based on the type of game. But from my research, that is more the exception than the rule. I think I made the point (maybe to subtle) that they won't switch games over once it is developed.
I also think Unity's DOTS tech will enable them to provide the tools needed by higher-end devs. This is just based on a couple of conversations I've had with people familiar with the technology.
A lot of operational execution needed here to have the thesis play out.
Fantastic analysis, Christopher! So much great information to process here. I work as a sound designer, so I have always been impressed in working with Unity for spatialization techniques and virtual modeling of physical/acoustic spaces. Amazing to learn about so many other possibilities with this software, especially in the Metaverse space! I am just starting to learn about that and WOW. Did I understand you correctly in the conclusion that Unreal says that Unity will be one of the main founders of the metaverse? Thanks so much <3
Hi Brian - thanks for the kind feedback! Correct, that is what I learned from an interview of Matt Ball. While I couldn't find an exact quote, Tim Sweeney is very clear in his interviews that Unity will play a role.
This is absolutely fantastic. Thank you so much.
Tremendous work of research. It took me a lot of time finishing the article, so I would be curious to know, how much time did you (guys?) put in completing the research
It's just me (I say we, writing from the company's perspective). It takes a lot of time - I'm trying to constantly refine my process to be more efficient. But it requires a thorough deep dive into the company and industry. I started the research back on October 20th and worked at least half days on it almost every day since.
I have a couple of questions: 1. The main revenue resource for U is ads, in the ads world, it doesn't process any pricing power, which is mostly obtained by Google, FB, AAPL, TTD etc. I think it will be an okay investment vehicle, but does it have enough Moat? 2. The customer it's helping should belong to SMBs, it's hard to tell if their rev is recurring, I'm afraid the churn rate is high, although there're always new customers, yet its' mainly due to the tail wind in the gaming industry, but that doesn't warrant the moat to invest the company in the long run? I am skeptical of the company's moat to sustain in the longer term, although there're impressive technologies involved
Great work. What is your price target? Do you have a position?
Amazing insight and analysis of the company and industry....so much that I got to know. Thank You Chris
This was a great write up - nice work. Id be a bit careful on the assumptions that developers only use one or the other (unity or epic). I’ve spoken to a few developers who have use unity for one range of games and then switched to epic for the next (or vice versa)
Agreed - there are examples of those who will use one or the other based on the type of game. But from my research, that is more the exception than the rule. I think I made the point (maybe to subtle) that they won't switch games over once it is developed.
I also think Unity's DOTS tech will enable them to provide the tools needed by higher-end devs. This is just based on a couple of conversations I've had with people familiar with the technology.
A lot of operational execution needed here to have the thesis play out.