SAN FRANCISCO--Perhaps the greatest challenge that mobile content creators face is in their interaction with the carriers--the "ultimate gatekeepers" as many refer to them. But there exists another hurdle to manage, and that's the consumer. In that vein, GDC Mobile cochairman Robert Tercek said in his opening statement yesterday, "We still haven't answered one of the more important questions, which is, who are we doing this for?"
Monday afternoon's panel, titled "The Mobile Operator Spotlight Session," addressed this very question. The session assembled four major players from key mobile carriers around the world and asked them to discuss how they viewed their own customers.
Moderator Seamus McAteer began the session by introducing his fellow panelists: Sebastien Blaser of Bouygues Telecom (France), Jason Ford of Sprint PCS (US), J.H. Kah of SK Telecom (Korea), and Key Sar of Verizon Wireless (US).
Noting that they were all (more or less) bigwigs in the mobile industry, McAteer added jokingly, "I am not a leader," as one explanation of why he was moderating the panel.
He then went into a brief presentation of recent data that his company--M:Metrics, a company devoted to measuring consumer consumption of mobile content and applications--has mined from the mobile sector.
The various data that he showed the packed audience of about 500 attendees catalogued mobile gamer habits, such as that while it wasn't just guys playing mobile games, they are 60 percent more likely to download games. He also judged female consumption to be concentrated around puzzle games and what he called "more straightforward" games.
But he quickly moved away from his own research and directed the discussion back to the panelists.
"SK Telecom does not mean South Korea Telecom," began J.H. Kah. After a pause, he added, "That's a joke--you can laugh now." And everyone did.
Kah was surprised that the use of mobile games fell far below his company's expectations in Korea. Of SK Telecom's 18 million subscriber base, only about 2 million visit its game sites, and only 1 million purchase games every month. Of the $800 million revenue the company earned in data downloads, only $70 million of it came from games.
But he acknowledged that addressing the needs of the consumer is an iterative process. Despite SK's enormous growth and its concerted focus on responding to consumer input, it was important to make the telco's product suite right, from the ground up. "We want to go out and talk to consumers on a regular basis, from top to bottom," he told the audience, adding that the success of Korea's mobile gaming market has made this year what he called a "come visit" year for international developers.
Kah also addressed the notion that many mobile users are completely ignorant of how to acquire or use mobile content. "People are so lazy that they don't want to try out new things," he shrugged. But he said that brick-and-mortar consumer stores were now addressing this, and he asserted the importance of consumer education for further infrastructure changes: "Training [the consumers] to use new services is crucial to building new data services in Korea."
Interestingly, Kah dismissed the potential for 3D games on mobile devices, at least for now. "3D games suck so far because content providers are too concerned with getting the graphics right," he warned content developers in the audience. "It's not about graphics; it's about game."
Key Sar of Verizon agreed. "Just because you can develop in 3D doesn't mean you should," he said, telling listeners that they should suppress any impulses to make Space Invaders into a 3D mobile game.
Sebastien Blaser's contributions to the panel discussion were centered around the defining question of the panel itself: the needs of the consumer. "One of the most important things is to respect the consumer," he told the audience. "To achieve this goal--to have a lot of games--you have to convince a lot of content providers to provide games."
He discussed Bouygues Telecom's use of the NTT DoCoMo's iMode mobile Internet service and the generally positive effects that choice has had on mobile game development--and not just in Europe. By working closely together, companies who have opted to use iMode (collectively known as the iMode Alliance) have helped Japanese mobile content providers build their businesses abroad for the purpose of porting their innovative games to European markets. Without doing so, localizing these Japanese games would have been very difficult.
In addition, he praised his company for establishing a "clear frontier between the content provider's job and the carrier's," asserting that such a barrier not only forces content providers to focus on making good games, but also lets them keep the bulk of the revenue earned from the game downloads--the carriers keep only about 14 percent of revenues.
He also encouraged the subscription pricing model over a pay-as-you-go or "premium content" pricing model, citing both its success at Bouygues Telecom and its ultimate goal of satisfying consumer preferences by keeping access to mobile games easy and cheap--around $2 to $3 per month, for most subscribers. It is the only way, he asserted, to maintain user access to numerous games while keeping the prices low. Furthermore, it generates a sense of loyalty among the players to their content provider and, thus, to mobile gaming.
Jason Ford of Sprint PCS, perhaps the most vociferous member of the panel, offered an occasional lighthearted jab whenever he could to his competitor Key Sar of Verizon, in spite of Verizon's stronger market share. "Yeah, yeah, yeah," he said, seemingly admitting it to himself, "you're second to Verizon…blah, blah, blah. Tell me something I don't know!"
He took several other opportunities to prod Sar, who remained relatively stoic throughout the entire discussion. But Ford explicitly acknowledged his attacks on Verizon and asserted that it was easy to forget that their companies were not competing with each other for game content, per se (at least not yet).
Ford also addressed comments that suggested Sprint was not focusing as strongly as other mobile carriers on gaming, and he admitted that it was true. Subscribers are the key to revenue, he explained, and data downloads didn't account for much profit. He indicated that Sprint was more concerned with generating competitive prices, coverage, and handsets.
Nonetheless, he said, Sprint has a robust gamer community numbering about 500,000 who connect with and challenge each other using Sprint's Game Lobby, which he suggested attendees think of like "Xbox Live lite"--a place where players can maintain a single name across numerous games. He also stressed that contrary to some rumors, Sprint continues to look at, and is perfectly willing to accept, mobile content from third parties.
Key Sar's appearance on the panel on behalf of Verizon was a deviation from the lineup on the schedule--Paul Palmieri was the assigned speaker. Sar filled in without a hitch and comfortably answered all questions, his confidence likely the result of Verizon's success. "The gaming business for us is very good. If you were sitting where I'm sitting, you'd have a big smile on your face." Sar, though, did not have a smile on his face for much of the presentation, perhaps keeping himself guarded against Ford's ribbing. But the figures would seem to echo his statement: Verizon has more than 350 games today and serves them on 38 different handsets. The company, he said, plans to launch eight to 10 3D games in 2005.
Verizon's 10 to 15 million downloads per month, he said, brings in "wonderful, wonderful revenue." That statement, though, invited a demand for further clarification. "You're not just talking about games, though, right?" asked Ford. McAteer cut in to try to answer the question himself, but Ford wouldn't have it. "Let him answer!" Ford said, sharing a laugh with the audience. He was right--those figures of Sar's included other mobile content in additition to games.
Though he was unable to cite specific numbers concerning the success of Verizon's mobile gaming services, Sar did tell the crowd that Verizon communicates almost daily with about 300 content providers and that it's constantly looking for more. "Verizon Wireless is still open for business," he asserted.