Efficient tool to build Mobile Apps for your Events

Posted in Tips on 19 September 2014
"Mobile" is no longer just a buzzword, it's a reality. Heck, there's even a pretty good chance you're reading this on a mobile device right now. But did you know that this year mobile web traffic is expected to exceed desktop usage for the first time ever?
For event planners of all kind, this shift means you should expect most attendees to show up to events with their devices in-hand. Or pocket. Or get the idea.
More importantly it means that if you don't engage attendees on their beloved smartphones and tablets, you're missing a huge opportunity to reduce your printing, collect feedback in real-time, and generate more revenue from sponsors.
Luckily connecting with your audience on their hand-held devices is pretty easy these days thanks to a Palo Alto based company called Guidebook. They offer a really easy-to-use content management system that makes creating a custom mobile app as easy as dragging-and-dropping icons and uploading your agenda via spreadsheet. Best of all, Guidebook's apps are optimized for all platforms (iOS, Android, BlackBerry, etc.) and don't require connection to the internet, which can be critical in a crowded event venue with spotty wifi.
If you're still handing out printed materials at your events, putting all that information into an app is a no-brainer. But in addition to the obvious eco-friendly and cost-savings benefits, Guidebook offers a host of interactive ways to connect with your attendees that simply weren't possible before. Take for example the ability to include surveys in your app and gather feedback in real-time. There's also a scavenger hunt feature that gets attendees moving around your venue in search of strategically placed QR-codes, and a networking module that allows attendees to digitally exchange contact cards with others who've checked-in.
Creating a mobile event app can also help generate more revenue. In their mobile sponsorship guide, Guidebook details a number of ways to monetize your app via things like in-app banner ads, sponsored push notifications, premium exhibitor listings, and other features that offer sponsors increased visibility. Planners who pull these levers effectively often recoup the entire cost of their app and potentially even turn a profit.
So all this sounds great, but what exactly does it cost to create an event app with Guidebook? Price depends on customization and branding. They actually allow you to publish a basic mobile event guide for free, but of course you'll have to upgrade for more advanced features like multi-track schedules, social media, attendee feedback, or gamification. (Pro-tip: they offer 20% off for non-profits.)
Whether you're just looking to print less and efficiently provide attendees with event logistics, or you want to engage your audience in innovative ways and increase revenue, Guidebook makes it really easy to leverage mobile at your events. Due to the rapid growth of the mobile web, apps have already become the norm at larger conventions and conferences, and soon attendees may come to expect mobile guides at events of all sizes. Guidebook makes this transition shockingly easy and is free to try.


3 Tips for a Meeting Planner on Handling a Crisis during an Event

Posted in Tips on 19 September 2014
Have a crisis team. That doesn’t mean just have your event coordinator call 911 if there’s an emergency. Rather it means that real people are assigned real tasks. And make sure that their task are reviewed in any and all pre-con meetings. You need to assign; someone that will communicate and update your delegates, an individual to communicate with local emergency tasks forces, a backup plan that covers all of the what-ifs (i.e. delegate deaths, transportation issues, accommodation issues, food and beverage, overall delegate safety). Schedule meeting times at regular intervals so that each person can review their responsibilities where decisions can be made as a result. Remember you will be operating in a very fluid situation. Your team must be able to react accordingly.
Local suppliers. It’s imperative that a meeting planner receives supplier contingency plans. Now I don’t mean what to do if the food is cold or if there is none of your favorite scotch available. A planner will require their local suppliers to provide scenarios for any situations that would interrupt, or jeopardize safety of, the event itself. That’s why important that local suppliers are part of a pre-con meeting (in addition to the regular contribution that these suppliers will make to the overall meeting).
Communication. This is where social media can be helpful. However, in order for communication to be effective during a crisis, it’s important that relevant information is collected ahead of time. Starting with the meeting’s delegates: collect all of their contact information, including next of kin. Have someone on your crisis team establish, and communicate, social media accounts that will be utilized during the meeting. There needs to be regular communication with delegates during a crisis. Even if you do not have important updates to report, regular communication will assure your delegates that you are on top of the situation. It’s also crucial to have alternative meeting points, should the hotel or event venue be part of the crisis. The last thing you want is for your delegates to be scattered around an unfamiliar city with no way of meeting up communicated.


Maximizing Event Attendance

Posted in Tips on 19 September 2014
If your business is hosting a networking event then it is vital that you maximise its potential exposure. After all, with all things considered, business events are expensive things to host and run, and you need to ensure you see a return on your investment. The best way to maximise any potential return, no matter whether it’s a financial return or a human relations/ networking return is to maximise the number of people who can attend it. Here are three very simple ways that you can do just that:
1)    Ensure the Event is Targeted
One mistake that many businesses make is to not target their event correctly. Although it is true that you want as large an audience as possible, you want everyone there to be relevant to the aims. Sending an invite to everyone in your address book is illogical for this very reason, and it can be self-defeating even if everyone turns up. The last thing that you want is one of your most important guests wondering why they bothered coming because there’s nobody there that they want to speak to. Likewise, you don’t want someone to leave because the event isn’t relevant for them, as this could stop people coming to further events and damage your friendship.
2)    Provide Food
If you’re inviting businessmen to your event then it is likely that they’ll be incredibly busy men and women. Due to this, to detract them from these schedules, it’s best to provide food for the occasion; particularly if your event takes place over lunchtime or on an evening.
As well as satisfying hungry businessmen, your food will also allow people to mingle and network, ensuring that everyone benefits from attending your event. By both boosting attendances and maximising benefits, providing food is a ‘no brainer’.
3)    Consider Location Wisely and Consider Splurging
Finally, if you’re looking to lure people in who wouldn’t normally attend, consider the location carefully, both in terms of location and wow factor. By simply holding it at your office it is likely that you’ll deter people. This leaves you with either two options: renting a meeting room or sorting something special.
Again, just renting a meeting room can be a little bland, and there are more extravagant options if the budget will stretch that far. Companies like Neptunus can even erect semi-permanent structures that will really help you wow your guests, leaving them talking about your event for weeks to come and attracting more people for the future.
So, there we have it, three simple ways that you can ensure you maximise the exposure and attendance that your business event needs to be a success. The only question now is, how far can you take it?


ABPCO research indicates money troubles keep 39% of PCOs awake at night

Posted in News on 19 September 2014
In a poll conducted amongst members of The Association of British Professional Conference Organisers (ABPCO), 39% of respondents commented that either market conditions or finance represent their greatest concern.
The short poll asked ABPCO members “What part of your business keeps you up at night?”
• 39% cited finance – relating to either budgets or market conditions
• This was closely followed by 24% citing sales and marketing
• And 21% citing management and HR
ABPCO board member and owner of Tekevents, Nicola Crossland conducted the research: “This research offers real insight into the ongoing challenges faced by PCOs working across the UK. In particular our members are suffering not just from reducing budgets and tighter financial controls but also greater client expectations and competition from CVBs and DMCs, who provide a wider range of services.”
In response to these findings, ABPCO has announced its first peer to peer debate – taking place at the Queen Elizabeth II Conference Centre on 23 September. The debate will focus on the business challenges of running association conferences. A key aim for the event is the production of a white paper examining the challenges facing PCOs. The white paper will be available via the ABPCO website once completed.
Crossland concludes: “The forthcoming debate will focus on partnership working and commercial considerations between association conference organisers and conference suppliers. It is the ideal forum to discuss many of the issues raised by the poll and we look forward to the input of both the panel and audience.”
Specific text comments amongst the responses to the poll included:
• Reduction in training budgets therefore affecting delegate numbers
• Profitability: Associations’ perception of acceptable remuneration vs the real cost of delivery to meet service level agreements
• Achieving targets with diminished budgets for activity
• PCO terms and conditions
• Increased competition for fewer contracts
• Finances – being expected to always deliver under budget
• Clients expecting more for less
• Convention bureaus taking on role of PCO


AEO launches enterprise forum to help Small & Medium Enterprises develop their exhibitions and events related business

Posted in News on 19 September 2014
The UK Government is offering significant support to the country’s Small & Medium Enterprises (SMEs) as they recognise that it is from this area of the business community that real economic growth will be delivered.
In parallel to this Government initiative, the Association of Event Organisers (AEO) has introduced a new category of membership – AEO Enterprise Member – with the aim of helping smaller businesses to develop and grow, thereby aiding the expansion of the UK exhibitions and events industry. To introduce this new AEO membership category, this new event has been launched.
The AEO Enterprise Forum provides a comprehensive programme which will illustrate how to grow one’s events business and highlight issues of which to be aware, whilst providing insights into what to look out for and how to deal with a variety of common issues that may hinder the growth of your events business.
The AEO Enterprise Forum is a one-day event that will track the business arc for organising events and each session will focus on a specific part of this cycle, from the conceptual stage, to working with venues and suppliers, to fund-raising for growth capital.
The speaker line-up is comprised of some of the leading lights of the exhibitions and events industry, all of whom have built events or event businesses from the ground up. Their invaluable expertise offers a wealth of experience, all of which can help in the effective growth of an events business, and highlight how to avoid painful mistakes.
The event is aimed at:
- Smaller exhibition and event owners seeking guidance to grow their business.
Event directors and managers looking for insights on how to develop their exhibitions and events.
Entrepreneurs who may be planning an entry into the dynamic world of exhibitions and events.
Students who are exploring the world of exhibitions and events.
The AEO Enterprise Forum will take place on 30 October 2014 at Olympia (Olympia Central, Level 2) in Central London.
Karim Halwagi, CEO – AEO, commented, “It is vital that we support and nurture the smaller organisers, as well as those looking to enter the industry, as much as possible so that we can see the continued growth of the industry as a whole. We wish to assist the emergence of the next generation of leading event organisers and help them avoid common issues that may hinder the growth of their business. “
“Along with a raft of superb current AEO member benefits, the new category of membership includes a comprehensive mentoring programme, with guidance from today’s industry experts. It is vital that we work with the industry from the ground up and offer support to those who really need it at the earlier stages of the business development.”


New Registration System Boosts Multimodal Networking Opportunities

Posted in News on 19 September 2014
A registration system harnessing the networking power of LinkedIn will deliver new business opportunities for the Multimodal 2015 community.
Social software company GleanIn’s registration solution uses LinkedIn profiles, allowing visitors, exhibitors and speakers to instantly see Multimodal attendees to whom they are connected or follow on Twitter.
“This will not only speed up registration, but also deliver lots of lead opportunities by matching exhibitors’ brands to interested visitors based on their answers to registration questions,” said Robert Jervis, Multimodal Director.
The GleanIn system shows exhibitors’ brands to visitors that already follow them on Twitter or are connected via LinkedIn and gives companies the opportunity to see and message them.
“Visitors will be able to request a meeting with exhibitors, and exhibitors will be able to see and message visitors they are connected to on LinkedIn,” said Jervis.
Multimodal 2015 is already 72% sold out, with many exhibitors returning, as well as a number of new companies exhibiting for the first time.
Multimodal will once more be teaming up with the Chartered Institute of Logistics (CILT) and the Freight Transport Association (FTA) to deliver a series of panel debates, workshops and seminars.
The show will also feature an Air Freight Pavilion hosting a series of air cargo-specific debates in conjunction with on-line news portal The Loadstar.
“We are already looking forward to a lively three days of networking and business opportunities for visitors and exhibitors, as well as some informative debate and useful training sessions,” said Jervis.
“Multimodal is the premier event in the UK and Ireland’s freight industry calendar and we are confident of delivering a great show in 2015 building on the successes of this year.”
Multimodal 2015 takes place between the 28th and 30th of April at the Birmingham NEC. Registration will go live in the next few weeks.


39 proven event planning strategies for negotiating with venues and hotels - Part 2

Posted in Tips on 18 September 2014
Continuing where we left off....
#21 - Customize your event menu
Don't just accept the pre-set menu from the venue. Sub out certain items that are less expensive (like in-season local vegetables instead of out-of-season vegetables that must be shipped in), or build your own menu by focusing on less expensive options.
#22 - Bonus insider tip: Piggy back onto an event that the venue has already booked by using the same menu as the other event. This can help you negotiate lower F&B costs because the kitchen does not have to prepare multiple menus; you can also use this tactic to minimize or eliminate any minimum F&B spend requirements.
#23 - Always negotiate for free meeting / event space
Many venues will provide complimentary event space if you meet your minimum spends for F&B and guest rooms. If you aren't booking rooms (or if your venue is not a hotel but is a meeting/convention center or reception hall) but are still spending money on F&B at the venue, use this spend to negotiate a discounted event room rate, if possible.
#24 - Repurpose your event / meeting space(s)
If you are paying for your event space, you can potentially save money by using the same rooms for different purposes. For example, if you have an event with multiple sessions going on at the same time followed by a big session with a keynote speaker, you could look for a venue where a large ballroom can be partitioned. That way you can hold your breakout sessions first followed by an hour-long networking session in the lobby while the hotel staff sets up the ballroom for the big session. If you go this route, you should confirm with the hotel that they have adequate staff and resources to do a quick reset of the space.
#25 - Negotiate for a free hospitality room
If you meet minimum spends for F&B and guest rooms, negotiate with the hotel for a free hospitality room that you can use as a VIP suite, a lounge for your sponsors or an on-site office for you and your event management staff.
#26 - Maximize your comped room ratio
Many venues have a standard ratio of one comped guest room for every 50 rooms booked, but often you can negotiate this down to 1:40, 1:30 or possibly lower based on your overall spend on the event.
#27 - Negotiate all minimum requirements and cutoff dates
Hotels want to ensure that, if they set aside guest rooms, event rooms and kitchen/staff resources for your event, they will make a certain amount of profit; hence their desire to have you guarantee a minimum spend for F&B and guest rooms, their most profitable items.
The guest room attrition rate clause in the event contract usually states that you will guarantee a certain percentage of the rooms in your reserved block will be booked by your guests; otherwise you will pay a penalty for the unbooked rooms. Standard attrition rates start at 10%-15% (meaning that you must book 85%-90% of the reserved room block to avoid penalties). You can fairly easily negotiate this to 20% or possibly 30% based on the total value of the event.
Your goal is to negotiate the lowest minimum F&B spend and guest room pick-ups as possible, as this will protect you against incurring penalties if your guest / attendee numbers aren't as high as anticipated.
When negotiating attrition rates, set a date before which you can reduce or increase the size of the room block without penalty. In addition, have the attrition rate be based on total room nights and not rooms per night, and have the hotel work with you to conduct a post-event audit to identify attendees who booked rooms at the hotel but not in the designated room block. These room nights should also count towards your total.
#28 - Ask how flexible their service charges are
You can't really negotiate sales taxes or tourism taxes, but you can often negotiate a venue's service charges, which sometimes simply adds net profit on top of all the items in the proposal. Again the higher your total spend, the more you can probably negotiate the service charges.
#29 - Beware of the required vendor list
Some venues have a list of vendors that you must choose from, and these vendors' prices tend to be much higher than if you used your own, non-approved vendors because the approved vendors are often paying for the privilege of being "approved" by the venue.
Negotiate to be able to use your own vendors, and if the facility will not negotiate on this, get pricing from outside vendors to negotiate with the venue to drive down the costs of their approved vendors. A venue doesn't want to lose your business because their approved lighting vendor is double the price of a non-approved vendor; they would rather negotiate with the approved vendor to get the price down and keep your business.
#30 - Always negotiate the audio/visual rentals
A/V rentals are often the most marked-up item in a venue's proposal, as up to 90% of the A/V cost is pure profit to the venue. Because this item isn't tied to a fixed cost (like labor) and because the hotel is making most of its profits on rooms and F&B, they will be more likely to negotiate on this.
#31 - Bonus insider tip: Use a third-party A/V rental service to drive this cost down even further.
#32 - Ask for free in-room WiFi (and free WiFi in the event space, if possible)
Most hotel rooms already come with free WiFi, so your guests shouldn't have to pay extra for it. However, some hotels charge as much as $5-$15/day for guest WiFi access, so use your total event spend to negotiate this down.
In addition, many venues have free WiFi throughout the venue, and you should also negotiate for free WiFi at your event. If you are holding a larger event where hundreds of attendees will all be on their smart phones/tablets, or if you are holding a high-tech event, you may need a lot more bandwith and the venue might not be as willing to comp this, so use your guest room and F&B spend to negotiate this down.
#33 - Negotiate both parking and transportation
If many of your attendees will be driving to the event, ask the venue to provide free or discounted parking for your event guests.
If your guests will be flying into town, see if your guests can use the venue's transportation options (limos, vans, buses, etc.) at no extra cost.
#34 - Make sure you have a favorable payment schedule
Whenever possible, never pay the full amount upfront. Negotiate so you pay a fixed percentage up front and then backload the rest of the payments. This counts double for any registration or ticketed events, when you will be seeing most of your revenues in the weeks leading up to the event. You want to float as little as possible in covering the hard costs (like food, room rentals, etc.) of your event.
#35 - Amend the cancellation clause
If you have to cancel your event, you don't want to lose your deposit or be on the hook for all kinds of cancellation fees. So add a clause that lets you change the date to hold the same or another event at the venue within a certain amount of time of the original event date.
Also, have the cancellation clause be on a sliding scale so that the further out you cancel the event, the lower the cancellation fee. And make sure the cancellation clause works both ways so that you are protected if the venue can't host your event after the contract is signed.
#36 - Consider booking new venues
New venues are often hungrier than established ones, and they are often more willing to negotiate and provide discounts. Just make sure that the venue will be ready for your event (this is where the venue inspection is very important) and that you have a cancellation clause that protects both you and the venue.
#37 - Bonus insider tip: Venues with bad or fair social media reviews may also be hungry to book your business and could be more willing to negotiate. Read the reviews to see specifically what people are complaining about and make sure that you inspect these items on your site visit and have the venue address these concerns and correct any issues prior to your event (and put all this in the contract).
#38 - Make sure everything you discussed is in the contract
Promises are great, but people don't always follow through on their promises, especially if they aren't compelled to. But if every item makes it into the contract, then promises aren't necessary because the venue is contractually required to carry out what is in the contract.
#39 - Sign the contract at the end of the month or quarter
Venue managers are often working to meet quotas, and often those quotas end at the end of a month or a quarter. You can even ask the manager, "Would I get a break on pricing if I signed this before the end of the month?"


Tips for coordinating guests' travel to your event

Posted in Tips on 18 September 2014
Whether you’re planning a wedding or you’re a corporate event planner, you know that the logistics can make or break an event. If the guests’ memories of the event are more about driving around in circles, lost, searching for the venue than they are about the fun they had there, that’s not a good thing. One of the best things you can do as you plan either a social or corporate event is to coordinate your guests’ transportation. Even if the attendees are largely local, coordinating charter bus transportation can eliminate the anxiety of finding the venue, the potential for drinking and driving, and avoid having to ensure space for lots of cars to be parked.
 As well, if you’re expecting attendees from out of town, a shuttle bus rental to transport them back and forth to airports and hotels can not only alleviate their stress, but your own, too, because you can ensure that they will arrive safely and on time. However, not all bus charter companies are created equal; here are some tips for choosing a charter bus company that will be reliable and suit your needs:
 1.     Safety first: Certainly, the first priority for choosing a charter bus rental company is finding one with a reputation for taking safety seriously. The website allows you check safety ratings of motor carrier companies; if you’re evaluating a motor carrier, look it up by name or U.S. DOT number on the site to discover its safety rating.
 2.     Check insurance: Bus charter companies have different regulations to follow based on whether they travel within states or over state lines. While you might think that’s their problem and not yours, it could be a problem for you if the bus charter company doesn’t have the proper insurance; it could get fined or impounded, which would leave you high and dry at the time of your event. Ask for proof of a valid insurance certificate that has a minimum of $5 million in liability coverage.
 3.     Get references or read testimonials: Some charter bus companies list testimonials on their websites, but it’s hard to know whether they are legitimate. When contracting with a charter bus company, it’s a good idea to ask the representative if s/he can provide three references, i.e. customers who can attest to good service that the company provided. Sometimes, companies are hesitant to do this, and it may not be because they’re afraid of what the customer would say… it could be that they have confidentiality agreements or other reasons why they’re not comfortable approaching former clients. However, if that’s the case, you can use Yelp, Angie’s List, or simply Google the name of the company with the search term “reviews” and you’ll likely find a host of reviews that will give you an idea as to whether the company is reputable. Every business is sure to have a few negative reviews, so don’t just read one or two. Check them out and look for a pattern of overall satisfaction or dissatisfaction before you make a decision.
 4.     Contingency plans: Ask the bus rental company how it handles unforeseen circumstances, like a bus breaking down en route to an event or a driver getting sick. What is their backup plan? You don’t necessarily need to know every detail about how they handle a Plan A and Plan B for each event because it’s their business to coordinate the logistics, but you should feel confident that the company has systems in place in order to accommodate a situation that could be out of the ordinary. Whatever the procedure is, you want to be assured that if they need to substitute a bus or driver, it won’t impact your guests’ safety or comfort, or their arrival at their destinations on time. Inquire as to whether the charter bus rental company has a 24-hour number staffed by real people (i.e. not voice mail) that you can call in case of emergency.
 5.     Driver screening: Ask what qualifications the driver must have. Again, safety is important, and this is part of that. Find out if the company’s drivers undergo drug screens, criminal background checks, driving record checks and other rigorous application processes. Especially if your event involves transporting children, you need to know that drivers have been screened appropriately. The driver must have a valid Commercial Driver’s License (CDL) with a passenger endorsement printed on the document. CDLs can be issued once a driver has demonstrated ability based on on-road and knowledge examinations. If necessary, inquire as to whether the company has bilingual drivers.
 6.     Cost! Of course you’re going to compare pricing of various bus charter companies before you make a decision. But, cheapest is not necessarily best. Many charter bus rental companies offer a variety of bus rental options so that you can choose specific vehicle amenities that are ideal for your group. Some shuttle vans, charter buses or minibuses have features like on-board restrooms, DVD players and wifi, so you should discuss with your representative specifically what would best meet your guests’ needs and what the involved fees would be.
These are all just starting points; the main aspect to scheduling a shuttle van or charter bus for your event is making sure that you have enough capacity to accommodate the number of guests you’re expecting and that the bus rental company is able to provide service to the venues where your event is being hosted. If you need more information about charter bus rentals, the American Bus Association has additional tips and facts on its website. Providing transportation might be the single biggest perk you can give your event guests; we’ve all been in situations where we’ve had to be somewhere on time, but we’ve struggled with maps and parking, or we’re simply too tired to drive home afterwards. Eliminate all of that hassle — it will be worth it!


Claimaday launch event a huge success

Posted in News on 18 September 2014
The 3rd of September saw the celebration of the launch in Kent of, home to The National Events Diary, an ambitious enterprise backed by Kent County Council’s TIGER Fund initiative.
With expectations of securing 46 jobs by 2017, this project was conceived and launched by founding directors and entrepreneurs Derrick Swain, Claire Burroughs and Louise Cox Chester.
Derrick Swain, speaking at their well-attended launch event in Faversham said “We were delighted to gain backing of KCC who believed in our idea based on their own event experiences, and secured a matched fund loan of £121,213. As we see the business develop and grow to a fully national enterprise and brand we above all see the significant benefits will be felt by the local supporting business and the wider community. We’re driven by those compelling factors.”
Mark Dance, KCC Cabinet Member for Economic Development said, “You could say Faversham has become the centre of all UK events! I am really pleased to see how Tiger funding has helped yet another business set up and create employment and grow the local Kent economy. The Faversham based company, Claimaday, will provide an invaluable tool to help plan and stop event clashes for organisations in Kent and further afield.”
There are over 17 million public events in the UK each year. With increased confidence in the economy this total is set to rise. Claimaday aims to list and update these events (however large or small) by the hour, removing the previous problem of checking a date’s viability. Now a simple search on the database allows a perfect date to be pinpointed and claimed.
The personal experience of entrepreneur Claire Burroughs inspired the concept of Claimaday. Claire said: “I once had to cancel an event due to a clash and I vowed to find a way never to let it happen again. When cost and reputation are at stake, it is vital that those behind any event are able to mitigate potential disasters.”
With its innovative and timesaving risk management capability, Claimaday has created an essential tool that has already attracted industry professionals. Marcus Chrysostomou, Head of External Communications at Kent County Council said: “By helping us to collaborate with partners, we can quickly find the best date and avoid event clashes with other major events in Kent. I can see Claimaday playing an important role in our crucial planning processes – another key piece of kit that my team can use to deliver fantastic events in Kent.”
Claimaday Ambassador Kaddy Lee-Preston is a free service that aims to revolutionise the way events are planned. The essential website also draws on experience from industry experts with tips, links and guides to maximise event success.
Ultimately attendance will make or break an event’s success – and the reputation of the planner. Using can reduce the risk of sharing a valuable audience with someone else.


Why Did Microsoft Buy Minecraft?

Posted in News on 18 September 2014

Even for a tech titan, $2.5bn is a lot to pay for a gaming platform. But Microsoft sees Minecraft as an investment for its future.

It’s fashionable these days for enormous American technology firms to spend exorbitant sums buying smaller, edgier companies. Amazon bought the video-game streaming service Twitch for $970m in August, Facebook acquired the Oculus Rift virtual reality headset for $2bn in July, Apple got down with the kids with its $3bn purchase of Beats headphones in May, while Google has been on an M&A spree since February 2010, buying one company on average every fortnight.
While it’s tempting to see these as nostalgic attempts to reconnect with their own days as young, energetic companies out to change the world, the explanation is almost certainly harder-headed. So what does Microsoft want with Swedish developer Mojang and its product Minecraft, a lego-inspired online game?
It’s profitable
The simplest explanation is often the correct one. With 54m copies sold and another 100m downloaded, Minecraft is a multi-platform gaming phenomenon, and this translates to the bottom line. The game, which allows enormous freedom to create buildings and objects within its virtual world, brought Mojang over $100m in profits last year.
But on its own, this can’t be the reason for the purchase. Even if the profits from Minecraft continue to rise, as they have since it was created in 2009, the game is unlikely, possibly unable, to become much bigger than it already is. And at $100m a year it would take 25 years for Microsoft to recoup the cost of purchase.
It’ll bring in fresh blood
When Apple bought Beats, the firm made a point of saying how in many respects it was paying for the genius and connections of Beats’ bosses Jimmy Iovine and Dr Dre, as much as for the headphones business itself. It makes sense – if they created one super-successful business for themselves, they can do it again for you.
This is clearly not the case here, however. Although most of the Mojang team will join Microsoft’s games division, founder and creator Markus 'Notch' Persson is leaving big business altogether. ‘I'm not an entrepreneur,’ he said. ‘I'm not a CEO. I'm a nerdy computer programmer who likes to have opinions on Twitter.’
One of those opinions that may have rubbed Microsoft up the wrong way related to his price tag. Back in 2012, he joked it was $2bn. 'Give me two billion dollars,' he tweeted, 'and I'll endorse your crap'.
It’ll boost Xbox
Minecraft is the most popular online game on Microsoft’s Xbox console, with more than 2bn hours of play logged in the past two years. While Microsoft has promised to continue supporting Minecraft on rival platforms such as Sony’s Playstation 4, it’s possible the firm will provide subsequent console versions of the game exclusively to Xbox.
But again, this wouldn’t justify the purchase. It would help Xbox gain market share, but it would also cost Microsoft profits from Minecraft’s sales elsewhere. Besides, boss Satya Nadella has said that Xbox is a valuable asset, but not core to the business.
It’ll help Windows Phone
This is the most plausible explanation. Microsoft is desperate to establish itself in the mobile market, of which its Windows Phone has only a 2.5% share. Minecraft is extremely popular on mobiles, being the top paid-for app on both Google Play and iOS Store in the US. At present, however, it is not on Windows Phone, as Mojang’s Persson claimed it wouldn’t be worth the effort.
Clearly, this will change, and Windows Phone will gain access – and later, possibly priority access - to Minecraft’s loyal gamers.
Whichever is the real reason, Microsoft’s purchase is still a gamble. The gaming market is notoriously fickle, and for any of the above benefits to be worth Microsoft’s investment, Minecraft will need to retain its popularity for at least the next five years.



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