Photo source: Brogent
Brogent will host 2022 investor conference at 2:30pm, Friday, Dec. 16th, at 4F, Regent Taipei (No. 3, Lane. 39, Sec. 2, Zhon Shan North Road., TAIPEI). Mr. Chih-Hung Ouyang, the Founder and Chairman of Brogent, will elaborate Brogent's long-term strategy and outlook. If you're interested in joining the event, please kindly registered online: https://forms.gle/e4vDBmwy6AKB5bFh6
Recently, Metaverse has become a frenzy among global investment communities. However, few people have noticed that a Taiwan listed company- Brogent Technologies (5263 TT), who owns 90% market share in the global high-end entertainment system market, has already put the concept of Metaverse into practice.
"We have been devoted to developing “immersive experiences” since the day we were established, which is also one of the important elements of Metaverse. Through Brogent's sophisticated entertainment system and premium technologies, riders will have a rich and exciting sensory experience and in the meantime dive into the ultimate fantasy world in a natural and comfortable way." Said Chih-Hung Ouyang, the Founder and Chairman of Brogent, with eyes sparkling with excitement.
"There is still a gap between the cost of wearable devices and digital content required to enter Metaverse and the affordability of users. Yet, our entertainment system provides users with diversified access to Metaverse. Ranging from large flying theater, medium-sized racing simulator and personal ride platform, Brogent provides entertainment system and content & services solutions for different scales. Through professional movement coding techniques, the digital content can be presented on different entertainment systems. For“Attack on Titan,” riders can soar in the sky with Scout Regiment and fight against the titans via our flagship motion platform i-Ride or personal motion simulator. Brogent shortens the distance between users and Metaverse while it only takes a movie ticket price to enjoy an immersive and thrilling Metaverse experience.”
The $10 billion worth Total Addressable Market (TAM) is expected to rebound after the pandemic
"Over the past decade, Brogent has successfully built and operated 88 entertainment systems worldwide and achieved 90% of global market share in high-end flying theaters industry. For the next five years, we will continue to drive the growth of Brogent and gain our market share in the $10 billion TAM through three key growth drivers: Entertainment System, Content & Services, and Operational Sales.” Chairman Ouyang explained the growth strategy to us with great enthusiasm.
Referring to the size of target market, Chairman Ouyang spoke with confidence: "The $10 billion TAM can be divided into two segments: First, we are aiming at about 1,200 theme parks around the world that will adopt new type of entertainment systems. The second is 750 global tourist attractions with over 2 million visitors per year. The global demand for entertainment system is about 2,000 sets. Based on the unit price $5 million, the TAM is up to $10 billion. Currently, our market share is only 3%, so we can say that Brogent just set sail on the great voyage. With a global team of 300 professionals, over 136 proprietary technology patents and 88 entertainment systems installed, these will ensure Brogent a huge opportunity for long-term growth.”
In addition, Chairman Ouyang expects the global leisure tourism market will have a U-shaped recovery after the pandemic. "Looking at the leisure tourism market over the past two decades, undergoing Dot.com bubble, global financial crisis and COVID-19 pandemic, the global leisure tourism market tends to rebound quickly from these disturbances and continue to have strong growth in mid-term. Including existing projects delayed by the pandemic and new orders of this year, Brogent currently has total of NT$2-billion-worth of orders on hand and 38 entertainment systems under construction worldwide.”
The three key drivers to stimulate Brogent’s sustainable growth
Starting from digital content and game simulation, Chairman Ouyang has over 20 years of experience in the entertainment industry. Before 2007, Brogent focused on providing game engines, video games, human-machine interface and video/audio solutions. In 2008, Brogent's first entertainment system, FlyOver Taiwan, in E-DA World set the first milestone for the company's entertainment system business. In 2013, the remarkable success of FlyOver Canada restructured the world map of entertainment industry and further accelerated Brogent’s expansion in global market. Nowadays, Brogent not only has the capability to define industry specification but also create innovative application in tourist attractions. “Our experiences of entertainment system technology, creativity, digital content and services during the past 20 years are the foundation of our sustainable growth.” Chairman Ouyang said confidently.
“The first driver is the rapid growth of our entertainment system. We have installed 50 flying theaters for global theme parks and tourist attractions and so far there are 38 systems under construction. The cumulative number of entertainment systems will exceed 100 next year. Our target is to install more than 200 systems in the next 5 years. Our flagship entertainment system, i-Ride, has become the best large-scale simulation platform in the entertainment industry. With our in-house developed content and systems, our client can install large recreational facilities efficiently. We also replicate that experience to small and medium-sized facilities such as m-Ride, Q-ride and VR solutions, plus building various themed interior designs, guests will feel completely immersive in their flying experiences.”
“The second driver is our Content & Services. In fact, a US$4mn entertainment system will contribute US$7mn (1.8x) life-time value (LTV) over 10 years. And you may be surprised to know that 48% of LTV is generated from content & services. This revenue is almost equivalent to the income of selling another entertainment system within 10 years. We will continue to expand our digital content database from 23 films to 50 films in the next five years, including flying films (which is the most popular film genre among visitors), game video, authorized IP, self-produced animation and interactive digital content in order to increase the revenue from film production, content licensing and movement coding techniques. By offering more Content & Services, we expect that it will bring more recurring revenues and long-tailed cash flows from every entertainment system sold in future. We aim to double the number of Entertainment System and Content & Services in order to drive our 5-year sales CAGR to exceed 30%.”
"The last but not the least one – Operational Sales. We have gained extensive experience from the past to ensure that a successful operating site is able to generate remarkable rate of return. For example, the benchmark of operating site “FlyOver Canada”, has attracted 550,000 visitors every year since 2013 and created $11 million annual revenue with more than 20% Internal Rate of Return (IRR). For the next five years, we hope we can replicate the success of operation sales in our five well-chosen global locations and bring Brogent's Content and Services into these operating sites in order to generate high-margin revenue and stable cash flows. We will strive to deliver 5-year sales CAGR to 40% and generate an ROE that is above 25% for long-term shareholders.”
Expand Brogent’s influence in global entertainment industry and continue to grow Brogent-verse in strength
At the end of the interview, Mr. Ouyang mentioned that "Based on immersive experiences, we believe that Metaverse should bring in economic benefits and application value in real-life as well. For instance, Brogent has designed a flight simulator to improve pilots' performance in qualification tests and it significantly reduced the cost and risks of flying a real plan. This is what we said the economic value of integrating online and offline. For future training, we can even invite ace flight instructors to train local trainees remotely and simultaneously.
Another example is our New York operation site, Rise NY, which will be officially opened on December 15th, 2021. Through the guided tour of museum exhibit galleries, different eras of New York are presented to the visitors. At last, visitors will take a ride on our flying theatre to see the past and present of New York from a unique bird's-eye view, which achieves the purpose of educational entertainment. Likewise, a variety of fields, applications, and spatiotemporal scenes are seamlessly integrated between virtual and reality. The boundary between online and offline is gradually blurred, but the economic value is mutually enhanced and it increases contribution to society at the same time. Therefore, I’m very optimistic about the future development of Metaverse and Brogent as there are infinite possibilities.”
“Brogent just celebrated its 20th anniversary last month. Thanks to the efforts of our global team and the support from supply chain partners in Taiwan over the years, Brogent became the global leader and brought revolution in large-sized recreational facilities in traditional theme parks. I am confident that the three key drivers - Entertainment System, Content & Services and Operational Sales will further expand Brogent’s influence in the global entertainment industry in the next five years while “Brogent-verse”will continue to grow with the Metaverse.”
If you would like to arrange a meeting with Brogent’s Chairman Chih-Hung Ouyang, please contact yvonnehuang@qtumic.com.
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