BigBen Interactive S.A. - Company Profile, Information, Business Description, History, Background Information on BigBen Interactive S.A.

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History of BigBen Interactive S.A.

BigBen Interactive S.A. is France's leading developer and distributor of video game console peripherals and a leading distributor of video gaming consoles and software in the French, Benelux, and German markets. BigBen operates in four primary areas: video game accessories and peripherals, non-exclusive video console and software distribution, exclusive software distribution, and the company's original operation, wholesale distribution of watches, gifts, promotional items, and electronic goods. The company's youngest and fastest growing activity is the design, marketing, and distribution of peripherals and accessories for the video console market, with products including a line of carrying cases for the Nintendo DS and the Body Pad gaming controller. The company carried out research and development for this category at its Hong Kong subsidiary, which was opened in 2000. BigBen's non-exclusive video console and software business includes its acquisition of the entire European stock of the discontinued Sega Dreamcast in 2001 and the non-exclusive distribution of software and video game consoles in France and the Benelux markets. In addition, the company acts as an exclusive distributor for a number of smaller software publishers, including deals with the Netherlands' 3Pi, the 3DO in the United States, and Jester Interactive in the United Kingdom. BigBen's smallest operation, the wholesaling business, is also its oldest, launched at the company's founding by Alain Falc in 1981. Falc remains the Euronext Paris-listed company's chairman and largest shareholder, with a 49 percent stake. Difficult trading conditions have forced the company to shut down its U.K. subsidiary in 2005. The company's sales, at EUR 135.85 million in March 2005, represented a drop of some 26 percent from the previous year.

Beginnings in the 1980s

In 1981, at the age of 20, Alain Falc founded a business selling watches at wholesale from his town of Lesquin, near Lille in the north of France. Falc named his company BigBen, in reference to the famous clock tower in London. Early on, Falc became a distributor for a number of watch brands, including Patrick Arnaud and Yves Bertelin Zeon, serving primarily the wholesaler circuit.

Through the 1980s, BigBen expanded its range of offerings, adding a variety of electronics goods, as well as gifts and promotional items. For the most part, however, the company remained close to its original focus on timepieces. By the early 1990s, Falc had put into place a thriving regional business. Lille's position near the Belgian border also gave BigBen an entry into the Benelux market.

The boom in the consumer electronics market at the beginning of the 1990s, especially the development of the video gaming console market, led BigBen to further expand its operations to include a wider array of products. Falc's recognition of the potential for the video gaming market enabled the company to become an early player in what was to become one of the world's largest-selling leisure sectors.

The company's background in distribution helped it win non-exclusive distribution deals with a number of fast-rising companies in the video game sector, including Acclaim, Nintendo, Sony, and Electronic Arts. With this catalog of heavy hitters, BigBen quickly became one of the leading distributors in the French video game market. BigBen counted among its customers such major retailing groups as Auchan, Carrefour, and Casino, as well as specialist retailers including Toys "R" Us and Fnac. At the same time, BigBen itself moved into the retail market, adding a chain of stores specializing in video games and consoles under the names Game's and Espace 3 and building a network of 14 stores by the end of the decade.

BigBen's involvement with the video game sector rapidly overtook the company's original wholesaling operations. Nonetheless, BigBen continued to distribute wristwatches and other timepieces, gifts, and promotional goods.

Designing for the Turn of the 21st Century

As the market for video gaming consoles developed, and the technology driving each new generation of consoles advanced, BigBen recognized a new market opportunity, that of peripherals and accessories. Following the initial purchase of a console, consumers often sought to enhance the gaming experience with new peripheral equipment, such as steering wheels for driving games or joysticks providing "feedback." These peripherals were also particularly prone to wear and tear and often needed to be replaced. At the same time, the console market generated demand for accessories, such as stands to hold the consoles or carrying cases and displays for the games themselves.

BigBen quickly moved into the design area as well, developing an increasing number of accessories and peripherals for the consoles. The company began releasing a line of memory cards, wired and wireless analog and digital controllers, cable links, and steering wheels, as well as its own accessories. By the end of the 1990s, the company had become the market leader for the consoles peripherals sector in France. In 2000, in support of this activity, BigBen launched a dedicated research and development subsidiary in Hong Kong, which in turn contracted for the group's manufacturing needs. The company rapidly became a market leader in innovative products, developing such peripherals as an LCD (Liquid Crystal Display) screen for the PS One or a vibrating steering wheel that provided interactive feedback for racing games.

Acquisitions played a role in BigBen's growth at the end of the 1990s and into the 2000s. The company established itself in the Benelux market with the purchase of Atoll Soft in 1999. That acquisition gave BigBen the leading position in the video console distribution market in Belgium and the Netherlands. The company also moved into Germany, establishing a dedicated German subsidiary in 2000.

Fueling the company's expansion was its public offering, with a listing on the Euronext Paris Stock Exchange's Secondary Market in October 1999. Falc nonetheless maintained a 49 percent stake in the company. In addition to its expansion into the German and Benelux markets, BigBen also targeted the market in the United Kingdom. In April 2000, the company acquired Planet Distribution, one of the United Kingdom's leading independent video game distributors. This operation was renamed BigBen Interactive UK. Yet BigBen was less successful in the United Kingdom than it had been in other countries. In 2005, after years of steady losses, the company placed the U.K. subsidiary into receivership.

Struggles and Successes in the 2000s

A major step forward for the company came in 2001, when BigBen acquired the entire European market for Sega's Dreamcast console system and video game software titles. Sega, hammered by the release of the Playstation II and the Nintendo GameCube, had decided to exit the console business. With control of distribution for the format, BigBen not only boosted its sales but added several years of steady profits.

The company maintained its multi-faceted growth strategy into the middle of the decade. In 2002, BigBen boosted its retail network with the addition of a new format, King Games, adding ten stores that year. The company also moved into a new area, that of the exclusive software distribution segment. Unlike the group's distribution operations for gaming consoles and major games publishers, which were performed on a non-exclusive basis, the company had recognized an opportunity to establish exclusive distribution agreements with smaller publishers, usually on a time-limited and regional basis. In this way, BigBen enjoyed sole control over potentially popular titles, while the smaller publisher achieved access to the larger distribution circuit through BigBen's established relationships.

The company quickly put into place a number of strategic exclusive agreements, such as the 2002 rights to the Super Trucks games series and the rights to distribute Manic Miner, a game for the Game Boy Advance. The company captured European exclusive distribution rights for titles from the United Kingdom's Jester Interactive in 2002. The company also negotiated a number of regional exclusives, such as a deal with the newly formed U.K. outfit Midas Interactive and the American company 3DO. In 2003, the company added JoWood AG, based in Austria, giving it the right to market that company's catalog of 21 titles in Germany, France, the Benelux countries, and Switzerland.

The winding down of the Dreamcast market in the mid-2000s, coupled with the company's own growing pains, contributed to a decline in company revenues, which dropped from more than EUR 225 million in 2002 to EUR 186 million in 2003, then to just under EUR 136 million in 2004. As Falc himself explained to Challenges: "We'd experienced a very sharp growth in 2001-2002. We didn't have the capacity to manage sales that strong!"

In response, the company began restructuring, including shutting down its money-losing U.K. operations at the beginning of 2005. The company focused on reducing debt and cutting down on investments in order to balance its books. At the same time, BigBen placed its international expansion on hold.

Despite its difficulties, BigBen remained the leader in the French market for video console accessories, beating out even Sony with rising sales at the end of 2004 and into 2005. The company prepared a new stream of peripherals for the 2005 season, such as the Multitap for the Playstation 2 and Action Replays for the Grand Turismo 4 and Metal Gear Solid 3 titles. BigBen's future also brightened when the company announced that it had received a license to develop a complete range of accessories and peripherals for the upcoming Xbox 360 from Microsoft Corporation.

Principal Subsidiaries: Atoll Soft Nederland BV (Netherlands); Atoll Software SA (Belgium); BigBen Interactive (HK) Limited (Hong Kong); BigBen Interactive GMBH (Germany); Espace 3 Game's SAS; Yves Bertelin SAS.

Principal Competitors: Sony Corporation; Nintendo Corporation; Guillemot International SA; Innelec SA.


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