Mobile games--growing fast and changing faster

SAN JOSE--In the "Mobile Games: Down to Business" roundtable at GDC, attendees discussed business models and success stories from around the world. The runaway success of Java games in India, new billing models in Korea, and a new distribution model for games on Symbian handsets generated the most interest.

David Collier, a Namco employee based in Tokyo, led the discussion, inviting attendees to comment on situations in their home markets. An employee of Japanese wireless content firm Dwango noted that advances in handset technology have prompted the company to change its focus from Java/BREW games to Flash games. Programming in Flash makes it easier to run the software and reduces programming overhead.

Carriers are always enthusiastic about applications that will increase data use and, hence, download fees. One Korean game developer commented, however, that consumers in his market are very sensitive to packet fees. As a result, Korea's handful of network-based cellular games suffers from a perception that they are expensive to play. Korean carriers are encouraging developers to continue to explore this type of game by allowing content providers to set per-packet fees over and above the fees charged by the carrier. This fee is split with the carrier, which makes for an attractive additional revenue stream for the content provider.

Then, one mobile game developer from India stunned the room with the comment that his company saw 1 million daily game downloads with a user base of only 7 million handsets. The company also boasts 70,000 simultaneous users for its network games, consisting mainly of simple offerings like card games and tic-tac-toe. He went on to explain that this strong performance is partially due to the fact that his company is a subsidiary of the cellular carrier and currently has a monopoly on game content on that network. Other important factors were the carrier's decision to make Java compatibility a requirement for all handsets--thereby ensuring the largest possible market--and offering all its games for free at launch. Post-launch, the company gradually phased in small fees, which nonetheless led to only a 10 percent drop in downloads.

On several occasions, the conversation turned toward distribution methods and the difficulty of getting software downloaded to and installed on a handset, especially in the US market. This prompted Collier to bring up "superdistribution," a viral distribution technology that currently only works on Bluetooth-enabled Symbian handsets. Using superdistribution, a user that has purchased a game can send a copy to a friend via Bluetooth, and the two can then play head-to-head over a Bluetooth link. When the original purchaser is no longer within Bluetooth range, the copy reverts to demo mode, and the recipient has the option to purchase an activation code. The software is already installed, so download costs and installation issues are not a consideration.

Mobile games represent a young industry, and business models--and even game genres--are still in flux. This rapidly-changing segment is one of the most vibrant parts of the game industry, and it will be interesting to see how overseas markets develop and how US carriers, content developers, and users will follow that lead.