Mobile games are big business, but Activision isn't taking the leap just yet

You'd think that megapublisher Activision would be investing more in mobile game development. After all, everyone says mobile games are the future. But even as companies like Supercell, GungHo and DeNA making large-scale cash on mobile games, Activision Publishing CEO Eric Hirshberg says his company is taking a measured approach to the space. So the question is, with Activision's resources, and solid proof that a company can bring in very meaningful revenues via mobile, why hasn't the company tried to really capitalize on the vast mobile game market? "Currently, we're primarily using mobile as a way to enhance the experience of our core franchises, not as a new alternate core business for us," says Hirshberg. "We know what we're good at. We're good at making highly immersive, high-production value games that people play for hours and hours. "Right now, that doesn't describe the mobile game environment, for the most part. That's not an indictment of mobile games, it's simply a description of whether or not it's the right place for us to focus our primary energies." Activision's primary energies are spent on retail-centric, big-budget games that take years to complete, require tens of millions of marketing and development dollars, and lend themselves to franchise-ability. Activision is in the empire business, and that business happens mainly on game consoles and PC. The few games that Activision has brought to mobiles have been strong entries, but it's hard to imagine they move the needle at company that makes hundreds of millions of dollars with franchises like Skylanders and Call of Duty. On mobile, games like Call of Duty: Black Ops Zombies, Skylanders Lost Island and a Pitfall remake did well for Activision, but certainly aren't the kind of breadwinners like Supercell's Hay Day or GungHo's Puzzle & Dragons. Those mobile game companies in particular make ridiculous amounts of money: Supercell reportedly was making $2.4 million per day off of two games as of April this year. GungHo was reportedly making $3.76 million per day off of just one game as of May. Electronic Arts has been making sure to invest more heavily in mobile, and has seen some success as well, most recently with The Simpsons: Tapped Out. Hirshberg says "of course" Activision is keeping a close eye on those large-scale success stories. But those success stories are rare. "I'm glad to see companies have success at a larger scale in that environment," he says. "A couple years ago, that wasn't happening. "At the same time, the percentage of companies capable of achieving that scale is very low in that business. And even more so, the percentage of companies that are able to create any kind of franchise effect is even lower -- meaning the top hits tend to rotate out every couple of months in that world. Even [developers of] huge hits like Angry Birds are now in different businesses, like franchising." For Activision, and other large game companies with roots in retail, the focus for now will remain on long-term franchises that players can attach themselves to for years. Even though Activision has thrown relatively little investment toward mobile games, Hirshberg admits, "You can't deny the size of the installed base. There are a lot of these devices out there."