Speaker 1: Bloomberg Audio Studios, podcasts, radio news, roadblocks is paying a
Speaker 1: price for children's safety. It's not prompted after the company
Speaker 1: credits for your bookings forecast. Making clear though that that
Speaker 1: new age verification and child safety features that they've embedded,
Speaker 1: they're creating some friction for user growth. CEO David Zooki
Speaker 1: joins us now, and you made really bold statements in
Speaker 1: the investor letter saying this is worth it. This is
Speaker 1: worth it long term because it's building a safer global
Speaker 1: standard of safety. Talk us through when you will see
Speaker 1: actually that friction die down.
Speaker 2: Hey, great to be here at highlighting coming off a
Speaker 2: great quarter forty three percent year on your bookings growth,
Speaker 2: bookings of one point seven billion dollars more than twice.
Speaker 2: What we've shared with investors is our long term growth trajectory.
Speaker 2: And yes, we've highlighted our commitment to setting the global
Speaker 2: standard for healthy, safe, age appropriate digital engagement. We have
Speaker 2: rolled out age check all around the world this quarter.
Speaker 2: We now have over sixty five percent of US users
Speaker 2: who we have age checked. But we did highlight in
Speaker 2: our earnings call there is some short term friction from
Speaker 2: communication and other factors. We believe though this is worth it.
Speaker 2: We are well on our path to ten percent or
Speaker 2: more of the global gaming market and more of that
Speaker 2: of us, and we want to bring along all of
Speaker 2: our under sixteen users as well as the over sixteen
Speaker 2: who are growing very rapidly.
Speaker 1: How about bringing along the industry, Dave, Because you're a
Speaker 1: first adoptor here of this technology that can help age verify.
Speaker 1: Do you think others in gaming will have to do this?
Speaker 1: Do you think others will experience such friction as you
Speaker 1: come out of it.
Speaker 2: I want to highlight if you go to our corporate
Speaker 2: site and read our values, one is take the long
Speaker 2: view and the others respect the community. We've continuously innovated
Speaker 2: on safety since we started in the company, and as
Speaker 2: the technology got good enough to age check, we've leaned
Speaker 2: into it. This is an addition, of course, to our
Speaker 2: industry leading text filtering, the fact that we don't allow
Speaker 2: image sharing on the platform. This has allowed us to
Speaker 2: do several things. In addition to age checking, We're going
Speaker 2: to be introducing kids accounts and select accounts. We're able
Speaker 2: to do this within our same app because we are
Speaker 2: age checking. Also because we're age checking, we can now
Speaker 2: identify the eighteen and up players on our platform, and
Speaker 2: we've introduced some interesting economics for them. So we do
Speaker 2: think we're setting the industry standard and we have this
Speaker 2: commitment to what we call the global standard.
Speaker 3: Dave, good Morning. You came on the program three weeks
Speaker 3: ago and I asked you if you would kindly model
Speaker 3: for us at that moment when you were announcing the
Speaker 3: new policy and new platform changes with safety in mind,
Speaker 3: how that would impact user behavior. And that's kind of
Speaker 3: played out in the earnings print, right, Just explain that
Speaker 3: the interaction between the policy that you put in place
Speaker 3: and why it would impact user metrics and behaviors to
Speaker 3: the platform.
Speaker 2: Well, I want to highlight we're using age checked and
Speaker 2: we're asking our users to age check if they want
Speaker 2: to use the communication functionality on roadblocks. So in Australia
Speaker 2: we're over seventy percent age checked, in the US over
Speaker 2: sixty five percent. But that does highlight there could be
Speaker 2: roughly thirty five percent of our users in the US
Speaker 2: who currently are not communicating on our platform. We believe
Speaker 2: that can contribute to some short term friction. In addition,
Speaker 2: as we go along on our eight in an over segment,
Speaker 2: we've shared that more and more, we're using our recommendation
Speaker 2: algorithms to support long term retention on the platform more
Speaker 2: than shorter term monetization. These both have contributed to short
Speaker 2: term friction.
Speaker 3: Dave, let's talk about Roadblocks's future and Roadbox Reality. This
Speaker 3: seems like a big play, a big upgrade from Roadbox Studio.
Speaker 3: We talk all the time to Unity. I am very
Speaker 3: into unreal engine right and how that impacts my experience
Speaker 3: in the games that I play. This presents an opportunity
Speaker 3: for you to do work with some of the big
Speaker 3: budget developers. Could you just explain the pathway to that well.
Speaker 2: I want to highlight two separate levels of this. We
Speaker 2: have continued to release over the last quarter and will
Speaker 2: continue functionality that is very unique to Roadblocks. Roadblocks is
Speaker 2: a game engine, a client, a cloud, and together we're
Speaker 2: committed to publishing once and having whatever you publish work
Speaker 2: both super high quality on a gaming PC, but also
Speaker 2: perform very well on a two gigabyte Android phone. Those
Speaker 2: are very different configurations. We want to support both with
Speaker 2: the same build as well as when our creators build
Speaker 2: on Roadblocks, they go around the world. The future for
Speaker 2: us is a hybrid architecture, and what we want to
Speaker 2: do is make it easy for creators to create experiences
Speaker 2: that are ultimately multiplayer and photorealistic and do it very
Speaker 2: easily by powering it with AI. So we have combined
Speaker 2: really a hybrid architecture we're starting to show it off
Speaker 2: that combines our multiplayer synchronization with cutting edge real time
Speaker 2: video world models. We believe this is the ultimate hybrid
Speaker 2: architecture to democratize photorealistic multiplayer I like that about.
Speaker 1: The democratization and making sort of the building of games
Speaker 1: open to many. How do you think about the pricing
Speaker 1: structure briefly, Dave.
Speaker 2: We've said initially roadblocks. Reality will not be free. I mean,
Speaker 2: real time video AI modeling in the cloud is expensive.
Speaker 2: But just like with the rest of the AI world,
Speaker 2: these prices are going to come down and down. I
Speaker 2: want to highlight this is complemented really with our vision
Speaker 2: for creation, and if we look at what's happening in
Speaker 2: the coding space over the last six months, more and
Speaker 2: more software engineers are literally having AI run overnight doing
Speaker 2: multiple iterations to help build software. Gaming is much more complex.
Speaker 2: It involves software, three D assets, NPCs, real time operations,
Speaker 2: terrain geometry. We're really pursuing that same vision that agentic
Speaker 2: multiple iteration AI work. With Roadblock Studio, we started introducing
Speaker 2: things as innovative as using NPCs to help test software,
Speaker 2: and we believe we're uniquely poised to help creators build
Speaker 2: more quickly, higher quality, and more diverse experiences.
Speaker 3: David Zuki, CEO of Roadblocks, thank you very much