There’s little doubt that gaming is moving towards the mobile and social platforms, and every day there is a new piece of analysis or opinion re-iterating this and suggesting bad times ahead for the console development houses and publishers.

There’s a very detailed presentation here from Digi-Capital which provides a good review of the state of play and who’s investing where.  In summary, there are four main ways to get revenue from consumers:

  1. Massively Multiplayer Online games, like World of Warcraft, where people pay a subscription of £10 a month and generally play for 15 hours a week on a PC.
  2. Classic computer games, usually bought on a CD / DVD in a shop for about £40, although moving towards download services which opens it up to independent game developers.  Played on XBox, Sony, Nintendo, PC.
  3. Mobile games, sold for about $1 – $10 on iPhone, Android, BB etc.  Usually much smaller experiences, can be built very quickly, and use features of the phone to create new fun games.
  4. Social games, which are usually websites, most often built in flash and available free to the customer and supported by advertising.  Now transitioning into the social networks where more casual gamers use the game as a way to interact with friends.

It should be noted that while there are a lot of people declaring the end of the console, in actual fact this sector has a lot of loyal gamers, and while they may decide to buy one less game a year due to having less pocket money (or having spent it on a few Angry Birds mobile games), console games remain a multi billion dollar industry still larger than the film industry.

However it cannot be denied that the mobile and social gaming markets are growing incredibly fast, from small independent studios through to the larger publishers translating existing game characters to the new platforms weekly.  While growth is good, there may be a note of caution attached to looking at the current top players.

Zynga are the hottest company in social gaming with ridiculous growth and early signup stats, yet players seem to be moving on, and not often coming back, causing problems for Zynga’s intended IPO this Christmas.  This may be a factor of the simplistic nature of the current crop of social games, certainly there are high expectations of more sophisticated social games such as Civilisation, which may usher in a wave of traditional games to be ‘socialised’ and push the boundaries of what’s possible with friends.

Another high profile company is Rovio, makers of Angry Birds, who have made many other games yet are concentrating on building up the Angry Birds property through as many merchandising deals as possible.  One reading from this is they feel that it will be hard to replicate their initial success with another game franchise, even with their own advertising network of 400 million users.  The obvious alternative is that now they have established characters with a whole generation of casual gamers, they’d be crazy not to cash in with the merchandising, and don’t need to rush out anything which won’t be at least as successful as their last hit.

Either way, both companies are providing entertainment and inspiration for developers and investors alike, the mobile and social platforms are becoming firmly entrenched as respectable gaming environments, and together this should ultimately breathe new life into the gaming industry and open it’s doors to a new generation of players.

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