• Mobile Games are Mainstream!

    We said it before: mobile is the biggest mass medium on the planet, and now game developers (and not only the sometime masochists that have been there for years) flog to it. According to a fairly large survey by GDR (which can be yours for too many dollars to count and has been reported about here) among 800 developers, a quarter of them are now making games for mobile phones with most of them (namely 75%) – surprise, surprise – choosing the iPhone as their platform of launch. This is doubling last year’s figures (apparently).

    The iPhone and its non-phone sibling, iPod Touch (and you have been reading that a year ago here, here and here) are proving a more attractive launchpad onto portable gaming platforms than dedicated gaming systems like the Nintendo DS and Sony PSP.

    The reasons will be the same as they were a year ago: a platform that is relatively easy to work to and a simple distribution model. With the number of downloads Apple continues to pile up, it is no wonder that developers from “traditional” platforms (PC downloadable, online, etc) are attracted to that. They will also be less scared of the marketing challenges since they had had to market their games in the whole wide oceans of the Internet previously (i.e. there were no carrier safe havens with feature slots). Whilst this does not mean that every traditional developer’s games will be successful on the app store, the threshold to enter is lower.

    It will be interesting to see if the wave will roll further into other “smarter” platforms, including Android, Windows Mobile (see the latest rumours for WinME 7, including full Xbox Live gaming implementation here), Symbian Maemo and Blackberry. With the device numbers clearly speaking in favour of that, platforms becoming more accessible and, last but not least, with easier paths to the users via OEM app stores, this is to be expected. Good times for mobile gamers!

     
  • EA & Playfish: Gaming Being Re-Defined

    In my last post, I hinted that the Google/AdMob deal might just not be the #1 deal of the week and, whilst one can of course dispute this, here’s why:

    On the same day Google’s AdMob acquisition was announced, there were more guys walking to the bank, namely the good folks from Facebook games kings Playfish (well, joint kings with Zynga) who have been acquired by Electronic Arts for a cool $400m (incl. earn-outs).

    Why is this more significant? Because it is (like Google/AdMob) a cross-platform play that (unlike Google/AdMob) also expands the basis of business models deployed. Playfish derives the majority of its revenues from so-called virtual currencies, and in particular also from lead-generation deals (which recently have become “a little bit” under fire for queries of their ethics). But ethics or not (and Playfish seems to have been fairly clean in this respect), the main point is that there has been a business model that is new, well -ish: it is not reliant on display ads nor paid subscriptions or download fees, etc. It is a new form of engagement there, crude in its beginnings but new no less: users are encouraged to interact with brands in exchange for personal details. Now, if done – as often – crudely, this has a bad feel.

    But brands might also want to grab this with both hands because it offers unprecedented opportunities to truly enagage their users: interact with them and they will be more forthcoming. Behave and their sentiment will be positive. Be sincere and they will recommend your brand to their peers (which accounts for 74% of purchases online!). Check my recent keynote on this topic…

    EA had changed the mobile gaming world when it acquired Jamdat by using a significant distribution footprint and leverage it with its own brands and the financial muscle only someone with its revenue HQ outside mobile could at the time. The acquisition of Playfish provides a similar footprint in the online world (do not forget that Facebook is “only” the largest bridgehead of online games).

    As with Jamdat, EA is expanding the options of available business models and this is to be commended!

     
  • iPhone Usage

    Here’s a report about an interesting piece of research into the elusive animal that is the iPhone and Android user, or more precisely that animal’s usage of apps (“… there’s an app for that…”).

    The researchers from Gravity Tank chose Android (well, the G1) next to the iPhone because Android Market and Apple’s App Store both allow “unlike older smartphones [sic!] easy access to a range of free or low-cost applications”. Now this is what the (mobile) world has become in the last 12 months…

    Anyway, the survey finds that the average (!) user has 23.6 applications on his/her phone and uses 6.8 of them every day. 48 percent report shopping for apps more than once a week. About the same number (49 percent) report using apps on their phone for more than 30 minutes a day. Woah, nice!

    But it goes on: 32% said they used portable gaming devices less because of their app-enabled phones. This reminds me of one of my predictions on how the iPhone would eat into the handheld gaming market (see here, here, here and here).

    And it shows, more importantly maybe, that these owners of the “newer” smartphones use them as true multimedia devices rather than only phones: 31% read newspapers less, 28% use GPS devices less, 28% use MP3 players less (well, they have one of the better ones if they use an iPhone), and 24% are watching less TV. Media going mobile then, finally…

    And then – another indication on how far we have gone – the NY Times starts to whine: it notes that “despite Apple’s relentless advertising of its App Store, it seems that the availability of applications is not the primary driver of phone-buying behavior.” Doh. Now, here’s a finding. 74% of the respondents said the device “allowed” them to check their e-mail and calendar, and it allowed them to consolidate multiple devices into a single device whereas “only” 67% cited the availability of new games and applications. Only 67%, huh? Brave new world!

     
  • iPhone Mobile Entry Gate for Game Developers

    Having just spent three incredibly inspiring days at Casual Connect Europe in beautiful Hamburg, there were – in respect of mobile games – two observations to be made: 1) the horror online and PC game developers express when looking at the fragmented space and the resulting “crazy” (quote) business models and 2) the iPhone is different, from a developer perspective this time.

    Many, many developers of PC and Mac-based games (be it downloadable, online, browser-based) look at the iPhone as an entry gate to mobile gaming. A lot of the developers I spoke with were interested to work with a specialist mobile games company with a view to bringing their content across to the mobile platform but would not consider including the iPhone in this: “We’ll do iPhone ourselves. It’s a pretty easy platform to work towards and we understand the distribution model.”
    This is likely to mean that there will be an ever-growing influx of games from reputable and experienced game companies onto the iPhone, and this might just increase the gap between Apple’s hit phone and the “rest” in content terms even more. Today, there are c. 4,500 games available for the iPhone (or so I hear; and remember that this is a mere 7 months or so after the AppStore launched), and a lot of providers are still missing on there. Whereas “traditional” mobile games have very high barriers to entry because of the complex (and hence expensive) landscape that one needs to address (hundreds of handsets, hundreds of distribution deals all to be struck with very big, often slow-moving “old-school” companies), none of this exists for the iPhone: Apple provides a simple agreement, there is one build to be delivered and one store where it is sold. Easy!
    Irrespective of where the remainder of the mobile world will run (and they all seem to run now in order to catch up with the latest “Apple Revolution“), the AppStore is likely to become the first test case where game developers from different backgrounds (PC, online, etc vs. “traditional” mobile) will compete for customers directly. The former have a huge advantage in that they could leverage their online presence to promote the mobile version, too. This is only done by a few of the mobile “pure-plays” and it is tough to compete for eyeballs with an online games company that has 100m+ unique users per month. On the other hand, the mobile specialists have better knowledge about the specific mobile device constraints (which are very different to the ones on a PC).
    Another interesting field to watch this year!
     
  • iPod Touch mounts Handheld Gaming Challenge

    A recent article discussed the rise and rise of the iPod Touch (that’s the iPhone without the phone). It apparently surged to the top of Amazon’s sales charts, and mobile ad firm AdMob reports that ads served to the device more than tripled between November and December to 292m. This growth is said to even shadow growth of iPhone ads served and is being called, well, unprecedented. People are said to shun the forced marriage with AT&T’s long-term phone plan that come with the iPhone. Makes you think (if you’re an operator).

    That’s all fine and dandy but I thought this was probably a good time to look at the iPod’s role as a handheld gaming device again. This was sparked by a remark from one of the Kleiner Perkins‘ chiefs (they’re the ones who set up the iFund, which invests exclusively into companies active in the iPhone/iPod Touch ecosphere) noting that the iPod Touch was now asserting itself as a more versatile alternative to the Nintendo DS or Sony’s PSP. This has of course been discussed for a while. The sales figures of the iPod Touch now seem to back these early (and initially largely theoretical) thoughts. 
    Nintendo has been keenly aware of this even before the recently published app download numbers were out. In the words of the CEO of Nintendo US (from the above WSJ article):

    “Whether you chose to play on your DS or listen to music on your iPod, we’re already in the same competitive space for time.”

    And whilst one could argue about the pound-for-pound comparison of pure touchscreen vs devices with gamepads for certain types of games, the huge upside Apple has created is the hassle-free and easy distribution model for games: a DS developer needs to buy the cartridges (and pay for them up-front), find retailers, and then sell. This means huge cash outlay and very significant commercial risk over and above the development cost, making for a much less risky business model. And as to the input: some of the accelerometer-powered racing games are significantly better to control than with any game pad.

    The DS is and arguably will be for a while a formidable gaming platform (as the father of a 10-year-old girl I can certainly vouch for that) but the sheer number of games available on the AppStore is likely to create a space longer term that may well tilt the balance in favour of the latter: you’ve got a) the arguably best music player in the market, b) higher WiFi usability (the DS doesn’t really allow you to surf the web), c) e-mail, maps, and all those nice little (and often useless) apps, d) much, much more choice of games at lower cost (anywhere from $0.99 to $9.99 as opposed to $30 for, say, Cooking Mama 2) and – to top it all of – e) the coolness factor of the sleek Apple form factor. Tough competitor, that.
    For mobile games developers and new iPhone game entrants this constitutes and exciting development as it opens the revenue potential further up, and all that at a comparatively efficient and high-margin market place.
     
  • Silver Lining for Games…

    … And a full-blown sunblast on Christmas Day, or so it would appear as per the latest PR from Try-and-Buy solution provider M-Biz Global. According to them, 2008 was a good year for mobile games (though I am not sure if the likes of MoConDi, Vivendi Mobile Games, Telcogames, Mighty Troglodytes, etc would agree). M-Biz’s numbers would rather suggest that the market may be shifting a little (or is re-focussing the better word?) towards pre-loaded trial versions of games. It is this segment that M-Biz is addressing, and it is therefore unsurprising that they saw downloads on Christmas Day soar to 6x (!) the average daily sales in the UK: a lot of people get new phones for Christmas and if something is on the handset already (a trial version), one is much more easily enticed into actually clicking that link.

    All in all, M-Biz reports a 62% increase in revenue year-on-year, and a 21.29% and 50% increase in EMEA and the UK respectively in December 2008 compared to the average of the previous 11 months. All good! 
    It tellies well with the findings open to see for everyone when looking at Apple’s AppStore: make the purchase process easy, make things transparent, and people will buy. The difference to both the AppStore and a pre-installed trial game is that it does not take the user 8+ clicks, a download, various cryptic messages (of the “this application is unsafe. Do you really want to install? Really, really, really?” ilk) to get gratification. I have mentioned on the Opinions on Mobile blog that I would expect this to be an area of focus for this year, and the numbers quoted by M-Biz would appear to being ample support of this.
     
  • Oberon plays iTV now, too: Pixelplay joins the family

    Our recently very acquisitive friends from Oberon Media struck again to create one of the first truly focussed triple-play gaming houses. They now acquired Pixelplay, one of the giants on the interactive TV (iTV) sector. This together with their own online activities (Oberon powers e.g. MSN Games) and their recent acquisitions of Blaze and I-Play creates a rather explosive mix.

    It will be interesting to see how they will manage to consolidate the whole thing with a view to the – at this time – still somewhat disparate portfolio: Pixelplay boasts the iTV licenses for the likes of Monopoly, Luxor, the World Poker Tour, etc, whilst I-Play excelled inter alia with “The Fast and the Furious“. Oberon’s ability to exploit titles now across three platforms may well give it some edge in the market, which – arguably – all the single parts urgently needed.

    The move shows an impressively stringent move on the part of Oberon into building a casual-games-focussed powerhouse that extends its strengths across the three main consumer screens of today, i.e. the computer, the TV and the mobile phone.