ICE 08: Panel Argues Opportunities Offered By iPhone, Flash Lite

The mobile games industry is in a funk, most commentators agree: but what can solve it? At the ICE conference in Toronto a panel discussed the future of the mobile industry, with few positive opinions for the iPhone or Flash Lite,  including Matt Gillis, Senior VP of publishing at Capcom Interactive, stating that Street Fighter will not be launched on the iPhone.

Moderator Matt Gillis opened by asking Tom Frencel, President of Capybara Games (developer of IGF Mobile Best Game winner Critter Crunch) what he had seen happening in the last year.

"For us it's been a fun ride in mobile," Frencel began. "We entered the games business through mobile thinking the barrier to entry would be low, but since then we've learned it's actually very difficult to make money in the market without franchise support. We wanted to build brands in the mobile market, and as a result, we've been moving out of mobile recently. We've moved our core business out of mobile to DS, PSP and PSN."

Hands-On Mobile does have franchise support, but Mitch Borgeson also agreed that it was very difficult to be successful in the mobile industry, albeit with different reasons. Discussing creating Guitar Hero for mobile Borgeson explained that "In the US on Verizon Wireless there are very high end handsets with 3D graphics, MP3 support, but on other carriers we needed to develop a 2D version that used midi files. And when you expand the support requirements internationally it becomes even more complex. We sometimes have to make 10-12 versions of the same game, and that's not even talking porting, where we have to support maybe 8, 10 thousand different handsets."

"At what point do you sacrifice quality for coverage?" Gillis asked.

"We don't like doing poor versions," Borgeson said. "We're all still haunted by the model from 5 year ago. In the first few years people were most concerned with ‘stocking the shelves' and that's why penetration is so low now, because if the first game you buy is absolute garbage the chances you'll buy another is pretty low. So we're a lot more stringent now."

"But at the same time," he continued, "carriers have a list of handsets that they want every publisher to hit. Some carriers that could be 30, some 50, and that can get very expensive very quickly."

Gillis then asked if it was better to hit 12 handsets but have very high quality, or to hit 30 but have them all be poor.

"It's all about managing user expectations," Borgeson offered, "but also your revenue expectations."

"You have to be on every handset to succeed," Gillis stated himself. "Are You Smarter Than a 5th Grader is probably one of the ugliest games available on mobile, but it's on every handset, and as a result is a top 3 selling game."

"Content quality doesn't make a big difference on sales," he argued. "With Are You Smarter Than a 5th Grader we could have build a flashy, gorgeous game, but we concentrated on mid to low-end handsets and ported up the higher end handsets. In order to be successful you need to aim for the largest user base. You don't have to have networked high scores or 3D graphics, and frankly when you do include that you delay your time to market and open yourself up for more issues with carriers."

iPhone: Hype or Opportunity?

Asked if they felt the iPhone was all hype or a great opportunity, everyone on the stage argued that the system as all hype other than Frencel, who remained steadfast in his belief that it was a great opportunity.

"If you've had a chance to play around with it, it has a really quite revolutionary interface," Tom argued. "I know for a fact that there a lot of developers thinking about making awesome games using that interface, and I think that's the focus of Apple as well."

From a hardcore gaming company it terrifies me that there's a device that has no buttons," Gillis responded. "Maybe because I'm not a garage developer but I think that traditionally successful video games are going to have a very hard time on iPhone."

"A lot of developers felt the same way when they saw the Nintendo DS the first time," returned Frencel. "It presents too much opportunity through the touch screen to discount."

Kay Grunwoldt agreed. "Just dumping your old IP and saying ‘oh, instead of a control pad and two buttons now you have a stylus' isn't ever going to work."

Gillis stated "Street Fighter won't get launched on iPhone, because frankly it won't work."

But it wasn't only the interface of the iPhone that Frencel felt offered opportunity: "I think the second opportunity is the distribution method. iTunes is an excellent way to distribute, and it addresses several of the problems that the industry has, including discovery and community building."

With Apple offering 70% of revenue back to developers, Grunwoldt was asked if Nokia was taking a similar route with N-Gage. "Apple has an interesting concept, and I'm interested to see how that turns out and evolves," Grunwoldt said.

"We have a slightly different approach. On one end, there's our platforms and tools. Because we offer development in C++ with our SDK developers are going to be able to do something cool very quickly rather than have to learn something new. From that perspective we're pretty much open and we encourage everyone to look at it. Our tools and SDK are basically free at the moment."

"From the distribution side the models that we have are wide open. We can do everything from operator billing, still a very powerful tool to direct credit card payments. We want to make the individual terms of each distribution deals up to the individuals."

"I think there's obviously been a problem with the way that carriers manage their deck," Borgeson said, expanding the discussion to look at the current methods of distribution. "If you're not on page one or two of the deck, no one is ever going to find your game. A screenshot and maybe 20 lines of text isn't enough, but whether other ideas, such as demos work is still debatable."

"On PC and Xbox it's easy to see what your friends are playing, but on mobile it's hard to tell your friends ‘hey, play this game it's awesome'" Borgeson continued. "That kind of viral distribution would help."

Flash Forward?

The panel were asked if the Flash Lite platform offered the solution to mobile's current woes.

Grunwoldt said "I think it's a really interesting development platform -- very unique, relatively easy to do things that look very nice -- but I don't think it solves any of the problems that we have discussed. It's really just ‘another platform'. It doesn't solve any of the problems of discovery or purchase process."

Gillis recounted his experience of the way new technologies are disseminated by carriers. While the technology department might want every new technology, such as Flash Lite, in every new phone they release, the sales department want new handsets to market very fast. So while marketing might announce that the carrier offers Flash Lite, perhaps only 9 handsets that make it to market, out of the tens a carrier offers, will have it.

Despite their negative opinions of the iPhone and Flash Lite, the panel did overall have a positive outlook for the mobile games industry in general. When asked if they felt that things had reached a status quo and if "Tetris was going to sell the most forever" Gunwolt argued "Original IP will eventually take it down."

"If you can create something compelling, the market will decide," he concluded.