LAGC: 'Casual Games: A View From The Top'

In the middle of the second day of the LA Games Conference, George Borkowski of MS&K, LLP moderated a panel of casual games luminaries including Charles Merrin, Vice President of North American Games RealNetworks; John Welch, President of PlayFirst; Chris Early, Studio Manager at Microsoft Casual Games; Cooper Moo, Vice President of Business Development at FUN Games; and Alex St. John, CEO of WildTangent. The group offered an optimistic look at the future of casual games. Casual Business - Long-Lived? "I take exception to the idea that casual games are short-lived and disposable," said Alex St. John early in the panel. For him, hit casual games generate strong revenue for many years. However, the treatment of the major casual portals of casual game distribution is a strong influence on this perception. "They kick the guy out after 60 minutes, and they shoot themselves in the foot," he said in reference to the current model of time-limited free trials. John Welch agreed, noting that the market is now changing that model dramatically. "The real crime is over the last five years we didn't change a thing." On The Female Demographic George then steered the conversation toward the older female player demographic, and here the panel stressed the importance of seeing the details. All noted that the demographics can differ greatly for each permutation of the game. Charles noted that we can't ignore that demographic, but there is a huge difference between the demographics of Zuma free and Zuma purchased; the older female demographic figures more prominently in the former case. Chris Early mentioned that this is also the case for games that sell on both MSN and Xbox Live. Alex noted that it's important to realize that many of those older women are also buying these games for younger children who don't have credit cards. The Future For Casual Games The panel then talked about what would be the ideal futures for their respective companies and molding the casual games industry. Cooper spoke of a model of multi-title, multi-year deals between developers and distributors becoming more and more fashionable: "Long-term business is the answer in this space." Chris reminded the audience of Live Anywhere platform that Microsoft announced earlier in the year, saying they are still focused on its potential to connect gamers on multiple platforms. John agreed that having such an infrastructure in place would be great from the design and development side of games. Alex felt that the shift towards new DRM models for casual games will help everyone in the industry. He talked about how his company's WildCoins system of using tokens for game time will be increasingly effective with game players as well as advertisers. Advertisers chose to sponsor these token-based gameplay sessions well before the underlying technology was in place, and consumers buying Vista PCs in the winter will see this framework preinstalled on certain systems from Dell and Gateway. Sponsored Play Of Games - The Way To Go? Charles is a lot more cynical about the shift away from these older models, reminding the audience that these models brought the casual games space up from nothing to the current day. That doesn't mean that there is no room for change, as RealNetworks is currently experimenting with different methods of in-game advertising. He believes there is much more to be done in content innovation and Real is working with partners to figure out the path to "some other multi-letter acronym" that will be the next big hit. Many in the panel talked about how sponsored game play sessions could be the financial future that casual games will live in. According to Alex, there are "many games fully paid for by the advertisers" before the game gets a single play. There are also advertising opportunities that are yet to be explored in-game, different ways of seamlessly weaving in commercial messages without interrupting the experience. Charles noted in Realnetworks's move of some games from pay-to-play to free with ads models, revenue increased significantly. Don't Forget The Casual Developer? This sparked a question from the audience on ad revenue and developers. Ariella Lehrer of Legacy Games noted that despite this greater potential for income, her company as a developer doesn't see it. "At 2 to 6 dollars to the developer from download portals…it's worse than retail. Advertising is even worse," she said. "I see you Alex… but I'm looking at $100 dollars in a quarter." Alex agreed that this is the case with some older models out there, but noted that WildCoins revenue will be shared with the developer. Chris also confirmed her experiences, mentioning that Microsoft's original policy called for no sharing of ad-generated revenue with developers. With new models and more awareness for these models among developers and the portals they deal with, the future of casual games will be even better. John concluded the panel with a final expression of excitement and optimism. When his games are available through these new business models, "I'd be thrilled to see monster checks from Alex [St. John]," he said.