Infinium announces Phantom partners

Infinium Labs today announced a list of 22 publishers and developers slated to provide games for the Phantom Game Service. The list features some big names, lead by Eidos, Atari, and VU Games. Others committed, according to Infinium, are 21-6 Productions, BraveTree, Chronic Logic, Codemasters, Dreamcatcher Interactive, eGames, Enlight Interactive, Framework Studios, GamerBlitz, Gameware Development, GarageGames, Global Software Publishing, Interplay, Kuma Reality Games, Legacy Interactive, Max Gaming, O-3 Entertainment, Riverdeep, and Skunk Studios.

Infinium Labs president and COO Kevin Bachus said today's announcement would be followed by additional announcements, including information on retail partners and specific games to be included in the service.

While no titles were announced today, Bachus said that in most cases, the publisher's full lineup of games would be available to subscribers of the on-demand service. If the service launched today, according to the statement, consumers would have more than 500 games to choose from.

Noticeably absent from the lineup are such powerhouse publishers as Electronic Arts, Activision, and THQ. Bachus did not rule out those companies joining the lineup--Bachus said no publisher has yet to categorically decline to partner with Infinium Labs.

GameSpot spoke at greater length with Kevin Bachus about today's news, what progress is being made toward meeting the promised launch date of November 18, and what impact Phantom naysayers are having on the ongoing operation at one of the game industry's most closely watched startups.

GameSpot: Today's news highlights partners but doesn't discuss any titles. Will you be announcing specific titles shortly?

Kevin Bachus: We're going to make announcements about specific titles just prior to launch, but I can tell you that in most cases we're talking about the entire library of each of the publishers. There are some titles that have been licensed to us that aren't even at retail yet.

GS: What's the biggest challenge when it comes to securing content?

KB: The biggest challenge is that in a lot of cases the publisher's rights haven't been perfected. In a lot of cases, the electronic software distribution rights have been reserved by the developers, so that's one of the reasons why you see us announcing by publisher and developer [instead of title by title].

GS: Perfecting the rights means what?

KB: I imagine the Harry Potter license that EA has is the size of a giant phone book, and it may say something like, "You have the right to create and distribute video games based on this property that will be distributed through retail channels on physical media." That would be a very carefully delineated, very restrictive license definition. But in some cases that's not so. There's a lot of incentive for the publishers to go back and clear [the rights issue] with the licensor.

GS: You mention Electronic Arts, but I don't see EA in today's announcement. Can I assume that EA and other triple-A publishers have, in fact, declined involvement and will not be on board?

KB: No.

GS: What can I make of the absence of EA?

KB: I don't want to talk about any particular publishers that aren't in the announcement and mischaracterize things, but I'll tell you this: There are no third-party publishers that we've talked to who have declined. Just flat-out fact. This is the first in a series of planned announcements. The challenge I have is that not everybody is moving with the same timeline. Some publishers have moved faster to try to get their contracts done. Others are moving a little bit more slowly. Some have challenges associated with going through their catalogues and trying to determine exactly what rights are available, and as a result trying to value the deal. What you should make of this announcement is that we've announced, in a very short period of time, a coalition of over 20 developers and publishers, including four of the top 10 PC publishers who comprise almost a third of the total market for PC games--and it only gets better from there. I'd hate to mischaracterize things, or speak on behalf of publishers who are still in play, but you should expect to see that roster get much stronger in the very near future.

GS: You talked about this being the first of a number of announcements. When I look at the calendar, I see that we're about two months out from your targeted release date.

KB: Yes.

GS: Does today's announcement signal that you intend to hit your November 18 release date?

KB: Things are moving toward that, but I wouldn't look at this as an indication one way or the other with respect to the launch date. Obviously it was important for us, once we reached critical mass, to come out and give people an indication of where we are. Given the fact that we have over 500 games that have been made available to us from almost half of the top 10 PC publishers, and a number of significant publishers outside the top 10, I think this a pretty compelling group of folks who are lending their libraries to us. Each day the lineup gets a little bit stronger.

GS: When will the next announcement be?

KB: You should expect to see another announcement from us before launch, but if publishers want to come on board after launch, I think that's certainly fine as well. That's one of the nice things about being a service--that we're constantly adding or improving, that we're constantly moving from that point forward.

GS: You're a pretty sophisticated gamer, Kevin. What's your opinion of this partner lineup? Is it what you were hoping for? Does it speak to the progress of the company?

KB: Look, we're a startup company and we obviously have a fairly compelling proposition for some of the biggest names in the industry. I think that's tremendously gratifying, to see that these guys feel that this is a service that they want to be associated with. They obviously feel that this is something that's going to go in a positive direction, because otherwise, there are certainly other opportunities that are vying for their attention. So, yes, I'm very excited by that.

Do I think that this is the final word on the subject? Of course not. I think, like I said, it gets better from here. Knowing what I know about the deals that are in play, and the folks that are not yet in a position to announce a partnership, but knowing that we're on a trajectory to get them closed before we launch, I couldn't be happier with the work that we've done.

GS: You haven't mentioned any retail partners yet. When do you expect to do so?

KB: Fairly soon. We've had very enthusiastic response from the retail community. One of the biggest challenges that we have is that we want to manage expectations. This isn't going to be a console-style launch. We're not going to put 600,000 units into the channel on day one like we did with the Xbox. This is going to be much more of a service ramp, much more like XM Radio, or TiVo, or DIRECTV when it first came out--those sorts of things.

What we're doing with the retailers is trying to have very close strategic relationships with a handful of partners who can get the product out into market, who we can drive consumers to when we launch. All the marketing messages are going to be tied around those particular retailers. We want to make sure that we make the most of every opportunity that we have with the retailers. So when we make those announcements, I think they'll be significant and I think that they'll be designed with an eye toward who the target customers are and where they shop.

GS: Have you signed any deals with retail partners yet?

KB: That's something I'm not comfortable talking about.

GS: Speaking of being happy with the work that you've done to this point, how does the chatter of a very critical segment of the industry affect you? And what is the financial health of Infinium Labs?

KB: You know, rumors always fly about new companies. One of the biggest challenges that we have is that we're not only a new company but we're a public company, so all our financial data is out there for everyone to look at. But that doesn't change the fact that we're prerevenue, we're in the process of raising money. Someone who's not involved in startups might think that our financials look like we have issues, but we're no different than most early-stage startups.

The question that you have to ask when you look at our financials is, are we raising money, and are the investments being vented in a way that's appropriate. If you go back and you look, and I know that there we a lot of questions about our most recent 10-Q, if you look back at the March 10-Q, it's not a whole lot different. And yet obviously we made headway in the last six months.

So I think that the announcement today certainly shows that there are at least 20 publishers that think that this is an interesting opportunity. I think that having this announcement certainly reinforces that to the investment community, and answers one of the questions that we get asked frequently, which is, What does the publishing community think about this? And like I said, I think it just gets better from that point forward as we start to fill in some of the gaps.

GS: Can you boil down the effort that led up to today's announcement?

KB: I think it's easy to lose sight of the fact that through all these things, when you're putting together a product, or a platform, or an initiative like this, it's a continuum. One of the challenges that we had with the last platform that I worked on is that the goalposts were constantly moving. I'm comfortable with that. At the end of the day, when the product comes out, when it's announced, and we start selling product, that's when you're going to really see the results of our labors. It's really kind of difficult to take a snapshot of it at this moment and say, OK, these are the chances of success based on what we've seen them announce.

There are folks who will look at this announcement and draw conclusions based on what we're saying. I think that they're missing the bigger picture, which is that a small company, a startup company with a good idea, was able to put together a group of folks who are looking at us as a partner to distribute their wares to consumers, and that that coalition includes almost half the top 10 PC publishers, and substantial publishers beyond the top 10 as well.

So I'm really thrilled with the work that Kathy Schoback [vice president of content strategy] and her team have done. It's been a tremendously gratifying to see that these folks have stepped up. I had a meeting recently with the studio manager at a very large publishing company, and kind of went through for him what the proposition was because I wanted to make sure that when the sales force came back to him that he understood what we were doing, and what would be required of his studio, which is effectively nothing. His comment at the end of the conversation was, "Well, I don't see why you wouldn't do a deal like this. There's no effort on our part, it's incremental revenue, there's no retail cannibalization. This is a great thing." And to have that kind of response where people finally get what it is that we're trying to do is a tremendously reinforcing thing.

GS: What does the future hold?

KB: We'll keep moving forward. Like I said, I think of this as a good start. I'm very excited about where we are. I think that it's probably better than what most people might have expected at this point.

GS: Thanks, Kevin.