Archive for September, 2010

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Blackberry joins the In-App Transactions party – new focus on gaming?

Thursday, September 30th, 2010

This week’s Blackberry Developers Conference has seen an unprecedented whirlwind of activity from Research In Motion. In addition to launching 4 new services for hungry developers to dig into, they’ve also upped the bar by launching a new iPad challenging tablet device, with an interesting focus on multimedia and gaming – a sign of things to come from RIM? Let’s look at the details.

Services

  • WebWorks Development Platform. This is most probably the most attractive offering for developers. The new WebWorks dev platform is a tool that will allow developers a quick and relatively pain free entry into the BlackBerry app party. Featuring a highly integrated platform for HTML5, CSS, and JavaScript codes, the offering funnels directly into native BlackBerry OS functions, as well as a neat packaging system the ports them into full fledged BlackBerry apps.
  • BlackBerry Messenger Social Platform. Think of this offering as a natural extension to the WebWorks package. The Messenger Social Platform allows developers to tap into BlackBerry’s system of sending and receiving files, user profiles, messages, and invitations – something that RIM has historically kept all to themselves. If any of these services sound remotely familiar to some other services widely found in mobile devices that focus on social interaction, particularly through gaming…read on.
  • BlackBerry Advertising Service. Now that RIM has opened the doors to developers, it’s time to monetize. First up – the new advertising service. Similar to Google’s AdMob and Apple’s Quattro, the BlackBerry Advertising Service offers two flavors – “simple” and “rich media” ads that will be served up via “only three lines of code.” RIM says revenues will amount to a 60/40 developer/RIM split.
  • BlackBerry Payment Service SDK. This is the one that really got me excited about all the new offerings. The first two are things that BlackBerry should have done 2 years ago. The Advertising service, ok, it might take a while to get up and running, but the new Payment Service, which allows for in-app payments via credit card, PayPal and/or carrier billing could, should, and will be a major boost for RIM. Not only will they be pulling in additional revenues, but by offering this option, the entire BlackBerry range of products just became a whole lot more attractive to an entire pool of talented developers.

Hardware

If you’ve been paying attention to what’s what in Tech today, there’s one major current in play – everyone’s gotta have a tablet. And it’s not that Apple is the only game in town, it’s just that Apple is the game that everyone is talking about – and has.
Not to be cut out of the party, Research In Motion presented their own offering earlier this week with the announcement of the PlayBook. An interesting choice of words for sure, especially coming from a firm that’s spent years and years focusing on big business customers.

playbook

RIM’s PlayBook is operating on the newly dubbed BlackBerry Tablet OS (powered by recently acquired QNX), and offers full OpenGL, POSIX support, and handles HTML5 flawlessly. Note the HTML5 functionality also mentioned above in the WebWorks offering? Ah yes…the image is becoming clearer now…

And now for the Apple killer – the RIM PlayBook will handle Flash content, as well as Adobe AIR apps – both features that are destined to make games developers’ lives a whole lot easier.

Speaking of games developers, the PlayBook features 1080p video, as well as an HDMI output and microUSB jack. For connectivity, RIM’s 7” dual-core 1GHz CPU device sports 802.11a/b/g/n wifi, as well as Bluetooth 2.1. RIM CEO Mike Lazaridis explained during the presentation that the PlayBook is, “an incredible gaming platform for publishers and players.”

Again, the trend o’ the day is for each and every tech manufacturer out there to put out their own version of a tablet computer. Dell’s not happy with one, but rather is bringing “a whole slew” of new devices to market in 3”, 4”, 7”, and 10” flavors. It was only a matter of time until RIM got on board, but what’s interesting to note is that over the course of their history, BlackBerry has never been the default thought when it comes to mobile gaming. Mobile enterprising – sure, but gaming? Not so much. When even the Brooks Brothers suits are coming over to the gaming side of the fence, there’s a clear deletion of the land in the sand happening as we speak.

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Virtual Goods market still on the rise in the U.S. – $2.1 Billion predicted for 2011

Wednesday, September 29th, 2010

Released yesterday by the Inside Network, 2011 looks to be a bumper year for the virtual goods biz. The Inside Virtual Goods report is forecasting some mighty big numbers for virtual swords, costumes and mounts, as founder Justin Smith and Virtual Goods Summit head Charles Hudson predict a gain of 40 percent – up from $1.6 billion in 2010.

“If 2010 was the year that virtual goods made a splash in western markets, 2011 will be the year that these markets begin to mature as the collective opportunity across social games, online games, virtual worlds, consoles, and mobile games reaches the $2 billion dollar mark,” said Smith.

However, Smith and Hudson do not go so far as to see the (virtual) world only through rose colored glasses, as they point out that while a large majority of this growth is/was due to Facebook, the recent restrictions on communications and updates that the social networking platform has put in place are bound to put the brakes on unlimited growth. They point out that while 2009 and 2010 saw huge growth rates, 2011 will see such an explosion in numbers.

In a CNN report, Forrester Research analyst Nick Thomas finds it difficult to put a hard number on the virtual goods market, as he finds online purchases of digital goods still outside the mainstream.

“There are a few companies doing this very well and executing this very well, so by the time you factor in ‘World of Warcraft’ and one or two others, then you’ve probably got a fair chunk of the market,” he said. “There are not hundreds and hundreds of companies doing this well.”

If by one or two others, Mr. Thomas is perhaps referring to Electronic Arts’ purchase of Playfish for up to $400 million, and Disney’s recent acquisition of Playdom for up to $763 million, then he’s right on the money. However, let’s not forget about Zynga, and their plans for global domination, as well as the hundreds, if not thousands of other successful virtual goods offering gaming firms out there today. And Android and iPhone apps – all to be considered under the virtual goods umbrella? Oh, and did I mention Xbox, PS3, and Wii?

Another page to consider under the “still outside the mainstream” argument is the notable shift to free-to-play over the past year. Spearheading this movement at the moment is Turbine. They began with flipping Dungeons and Dragons Online to a free-to-play model, and only to report massive virtual currency sales, ahead of it’s public launch date. Building on this success (and a Warner Brothers acquisition), Turbine then repeated the formula with their flagship title Lord of the Rings Online.

To summarize, Smith and Hudson’s numbers, as well as reasoning appear to be well founded. Barring any catastrophic events, it appears as though 2011 will be a great year for the virtual goods market.

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Microsoft lines up top advertisers for Kinect launch

Tuesday, September 28th, 2010

Announced at this week’s Advertising Week 2010, Microsoft has lined up key advertisers for the upcoming November 4th launch of their new motion control system for Xbox 360.

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As Microsoft hopes to usher in a new way of play, advertisers are already showing interest in how their ads can be interacted with. Taking advantage of Kinect’s unique response to body movements, Chevrolet, Sprint, and T-Mobile USA will launch respective ad campaigns across the Kinect console network, “Kinect Joy Ride,” “Kinect Adventures,” and “Kinect Sports.”

All ad campaigns are slated for a November 4th launch; let’s take a deeper look:

  • Chevrolet. This was the first campaign that was announced for Kinect, back in June, and places auto maker Chevrolet in a prime position to allow customers the opportunity to test drive Chevrolet vehicles from the comfort of their own home. The title will open with users driving Chevy’s new Volt car, but users can unlock additional cars such as the Cruze, Camaro, and legendary Corvette by watching video advertisements either on Xbox LIVE or the Web. An additional campaign is slated for the first of the year where Chevrolet will feature the same vehicles in the Kinect Hub.
  • Sprint. US telecom provider Sprint will launch “Kinect Adventures,” with a matching retail experience features on Xbox LIVE, as well as a “Kinect Adventures,” contest whereby players will have the opportunity to have their pictures features on Xbox LIVE. Those attending the NY Comic Con (October 8-10) will have a first crack at “Kinect Advetures,” as the campaign will be live at the Sprint booth suring the convention.
  • T-Mobile. Focused on sports, T-Mobile enters the Kinect ring with fixed product placements throughout the motion based games including volleyball net logo placements, custom bowling balls, and foam fingers in the virtual stands. In addition to the product placement, T-Mobile is going the extra mile and sponsoring a contest whereby players can view video content and partake in the first launch weekend “Play and Win” contest with prizes including Family Gold memberships (a $99.99 retail value).

“With Kinect for Xbox 360, we are removing the last barrier to interactive television — the controller,” said Mark Kroese, general manager of the Interactive Entertainment Advertising Business Group at Microsoft. “We have seen tremendous momentum from the advertising community, including big campaigns from Chevrolet, Sprint and T-Mobile. These visionary marketers are leading the entertainment revolution with ground-breaking campaigns that are highly engaging.”

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Zynga continues expansion – acquires German game engine studio

Monday, September 27th, 2010

Despite Facebook’s recent curtailing of how games and game notifications are presented on the social platform, Zynga is charging full steam ahead. Announced late last week, Zynga can now count Europe as part of it’s growing collection of assets via the acquisition of Dextrose, a German game engine developer.

Based in Mainz, Germany, Dextrose is the company behind the Aves Engine – a powerful engine that allows complex games to function in a web browser or mobile device through HTML, CSS, and JavaScript. Dextrose, now to be known as Zynga Germany, might have been purchased by Zynga, but their future is as of now, still uncertain. Founders Paul Bakaus and Rocco Di Leo will become Chief Technology Officer and Country Manager, respectively, but Zynga has also stated that Dextrose would be focusing on the “best in next-generation gaming technology,” as reported by VentureBeat.

With one of the most common complaints about Zynga titles being their poor graphics, it’s clear to see what Zynga has in store for the Zynga Germany studio. When compared to the standard set of graphics presented today by Zynga, and the video below demonstrating the Aves Engine, we’ll either see a major retooling of Zynga titles, or perhaps pushing the brand even further, Zynga might roll out FarmVille 2.0, or FarmVille HD, etc. Either way, the question remains whether or not Facebook will support Zynga’s new Aves Engine tech, or….will this technology be something that Zynga will use to lure players away from Facebook, and onto their own platform(s)?

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Atari Games Online is a GO!

Friday, September 24th, 2010

While it might not be the same Atari we all remember of 2600 fame days, it looks as though Atari is poised to make another big splash in the gaming industry. Announced yesterday, Atari officially rolled out their newest offering – Atari Games Online, or Atari GO. The goal is to support the development of new online casual and social games by way of assisting games developers in navigating the tricky waters of online game publishing.

Online industry vet Thom Kozik brings his 25 years of gaming experience to the Atari initiative. Kozik has been a driving force in such major players as Microsoft, Yahoo!, Bigpoint, and K2. Putting his experience straight to use when he joined Atari in March of this year, Kozik is focused on attracting independent developers and content distribution partners, all under Atari’s new multi-platform approach (read, Facebook diversification) towards development, marketing, and distribution. At launch, Atari reports that over a dozen developers are already using the GO services.

“Thom brings a wealth of experience and insight to his role here at Atari as he joins our management team during this high growth period in online gaming,” said Lapin. “We look forward to bringing modernized versions of our well-known games, such as Asteroids, and new original games to global online marketplace.”

Looking a bit deeper into the Atari Go services, here’s what we have on tap:

  • The Independent Developer Program. This initiative seeks to bring new original games as well as games based on Atari’s deep catalogue of classic titles.
  • The Affiliate Program. Aimed at attracting popular independent sites to embed authorized and licensed (read, non-clones) classic and new Atari titles, ultimately sharing in the revenues generated.
  • The Distribution Program. Plain and simple – targeted at top social networks, portals, and game aggregators to expand the Atari audience.
  • Marketing and Platforms support. This program is aimed at assisting developers with distribution, marketing, and metrics. Under this umbrella, Atari will also assist developers in publishing on multiple social networking platforms, portals, etc., as well as fine tuning inventory management, monetization and advertising efforts.

“The programs, tools and support structures behind Atari GO allows developers to focus on making great games that can then be delivered globally,” said Thom Kozik, Executive VP, Online & Mobile at Atari. “Developers can already sign up for our programs and collaborate with us as we envision the future of cross-platform gaming.”

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Zynga – Full speed ahead! Facebook – Dial it back.

Thursday, September 23rd, 2010

Facebook CEO Mark Zuckerberg recently outlined changes to the social networking platforms changes, specifically in regards to the way games notifications impact other Facebook users. Delivered from Facebook HQ, Zuckerberg said that despite being one of the most popular services on the platform, games are also Facebook’s biggest source of complaints. Looking at the numbers, some 200 million of Facebook’s half billion users regularly play games on the platform. Naturally, gaming companies want that number of players to increase, notably through viral notifications and buzz creation (think FarmVille status updates), something that Facebook has already revised, with these notifications only appear in the news feed of other users that have the same game installed.

Sounds fair and reasonable, no? Yes, if you’re Joe Average consumer, but if you’re a gaming firm with millions invested in a solid return, primarily based on Facebook’s platform. Remember, the last time Facebook altered it’s rules and regs, Zynga reported losing over 10 million users.

On the other side of the coin, fence, field, however you want to look at it, Zynga CTO Cadir Lee took center stage at the Oracle OpenWorld event in San Francisco and stated that approximately 10 percent of the world’s internet population (around 215 million people) have played a Zynga title. To support these kinds of numbers, Lee commented that Zynga is adding as many as 1,000 servers every week to stay on top of demand. Keep in mind, this isn’t just FarmVille we’re talking about, but Zynga’s ‘other’ children, FrontierVille, Mafia Wars, Café World, etc.

While these changes aren’t likely to effect the average Facebook gamer, as you’ll keep on seeing your friends’ notifications, it does have significant impact for Zynga, as well as every other Facebook gaming focused development house. Zynga wasn’t the first on the scene, but the certainly the ones who ‘got it right’ and maximized the Facebook landscape before the floodgates were closed. Facebook’s new implementations have effectively killed the viral spread, and to Zynga’s credit, they’ve already been diversifying, and with this announcement, it seems as though they’re one step ahead of the game – again. However, with this in mind, one can’t forget about the five-year deal that the company agreed to with Facebook, but keep in mind Zynga’s deal with Yahoo! as well as the rumored Google Games Service.

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Michael Jackson – now a planet!

Wednesday, September 22nd, 2010

MindArk has recently announced a collaborative deal with SEE Virtual Worlds to bring Michael Jackson to it’s real-world economy Entropia Universe. SEE has recently struck a deal with the Michael Jackson Estate to publish Planet Michael which will offer fan around the world the opportunity to celebrate the King of Pop through interactive gaming and a unique social experience.

Planet Michael is under development, with a planned release date sometime next year, and features a space theme with elements draw from Michael’s music, life, and humanitarian causes that were important to Jackson. Planned are entire continents themed around Jacksons’ life that are aimed at longtime fans, placing them in a familiar, yet unknown, environment.

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“When we first approached the Estate and talked about creating Planet Michael, one of our primary goals wasto build an interactive environment where fans from all over the world come together to affirm Michael’s life-long dedication to fostering global friendships,” said Martin Biallas, CEO of SEE Virtual Worlds. “In building a space worthy of those global connections, we envisioned a magical, enjoyable place that will capture that zest for fun and life that was at Michael’s very core. Throughout his extensive career, the King of Pop was well-known for his visionary contributions to music, dance, fashion, entertainment and philanthropy, and it was critical that we somehow incorporate all of those elements into the game.”

Planet Michael will be the first world published by SEE Virtual Worlds for Entropia Universe. Staying inline with Entropia’s play mechanism, Planet Michael will be free-to-download and be subscription free. The Entropia Universe monetization module will be in place, allowing players to devote their time to specific professions, and in some case, able to donate their earning to charitable causes.

“No artist unified the world like Michael Jackson, so it is fitting that in Planet Michael his fans will be able to join together in such a unique way online to celebrate his music, his artistry and his devotion to helping those in need,” said John Branca, co-executor for The Estate of Michael Jackson. “Michael was always exploring creative new ways technology could enhance the experiences of his fans, and for that reason we are thrilled to be working with SEE Virtual Worlds to build a global interactive experience that befits an artist as innovative as Michael Jackson,” added John McClain, co-executor of the Estate.

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Digital distribution has overtaken retail. 80% of gamers do not purchase games digitally.

Tuesday, September 21st, 2010

An interesting occurrence, as yesterday both the NPD Group and Interpret LLC issued reports stating that digital distribution was on the rise and decline at the same time.

The NPD report

According to NPD, in the PC gaming space, unit sales by download may have already surpassed traditional brick-and-mortar sales. January-June of 2010 saw 11.2 million PC games purchased in the U.S. via digital distribution methods versus the 8.2 million boxed, in store counterpart. When viewing 2009’s data, the year saw 21.3 million digital distro puchases, with 23.5 million boxes moving out the door.

However, NPD reports that PC software sales are down overall, with both digital and physical revenues down 21 percent from this time last year, attributed to a 14 percent drop in overall unit sales.

Another noteworthy factor in NPD’s research is their lack of direct relationships with digital retailers. Meaning, a large percentage of the data collected for this study was culled from third party tracking data, which, is generally quite accurate, but NPD still isn’t getting the figures directly from the supplier.

Conflict“One major finding from this latest report is that the ‘big got bigger’ in the first half of 2010, with both Steam and Big Fish capturing a bigger share of full-game PC games digital download sales than they did last year,” says NPD analyst Anita Frazier.

The Interpret LLC report

On the other side of the coin (and country), Santa Monica, CA based market research firm Interpret LLC found that between Q1 2009 and Q1 2010, 80 percent of gamers did not purchase games digitally. Obviously, after reading the above referenced NPD report, results and claims may vary depending on the data used.

Of the 20 percent of gamers that did purchase games digitally, Interpret found that this segment also tended to purchase more games at physical store locations as well. Interpret also found only “moderate” advances in digital distribution channels such as Steam, and similar “moderate” growth on console digital downloads such as the PlayStation Store, Xbox Live Marketplace, etc..

What’s key to note about Interpret’s report may be found in managing strategist Brenton Lyle’s statement, “It is critical that both the publishing and retail sides of the game industry avoid overreacting to a vision of rapid transition to digital distribution that fails to reflect reality,” meaning, depending on which data set you want to look at, the reality can be viewed quite differently.

Neither report took into account today’s highly active (and lucrative) microtransaction and/or subscription revenues that are generally associated with such large titles, nor did they include any virtual currency or goods purchased via social networking platforms.

Again, depending on your viewpoint, Digital Distribution has either already overtaken brick-and-mortal, boxed games, or…80 percent of gamers do NOT purchase games via digital distribution methods. You decide?

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EA: in game ads raise real world sales

Monday, September 20th, 2010

EA has recently announced the results of a study conducted by The Nielsen Company which demonstrates the effectiveness of in-game advertising. More specifically, the study illustrates just how effective in game ads can be at raising real world sales. Commissioned by EA on behalf of Gatorade, an in game advertising client, the study found that households that were exposed to in-game adverts of Gatorade increased their spending on said product by 24%, or an ROI of $3.11.

285240-ea_sports_logo_largeAnd this isn’t pre/post roll ads were talking about here. Gatorade’s ads ran as arena signs, player’s water bottles, score updates and other call outs (verbal) – actions that only mirror a real-world sporting event. The Nielsen study targeted NHL ’09 and’10, NBA Live ’07, ’08. ’09, and NBA Street Homecourt, all EA titles.

“Video games are a deeply engaging consumer experience,” added Gerardo Guzman, Director, Media Product Leadership for The Nielsen Company. “Bringing our industry accepted ad effectiveness understanding to video games is another way to help marketers understand how consumers respond to advertising across different environments. This should help optimize the impact of and derive a return on media investments. In this case the story is simple — dollars put into video game product placement result in more retail dollars.”

100,000 households were surveyed, accessed by Nielsen’s US Homescan panel. The Homescan panel represents the average US population, and this study included homes that scanned video game UPC barcodes. These barcodes were then in turn cross references with a database of over 14,000 video game titles, thus ensuring accuracy. Nielsen then compared this data with homes that purchased on of the selected titles both before and after the Gatorade ads were inserted – vs. the households that hadn’t purchased one of the titles, i.e. the control group.

What makes this study noteworthy, beyond it’s factual statistics, is that it’s the first time that this form of measurement of in-game advertising’s effectiveness has been measured by these standards. We’ve all seen, thought, or heard of IGA’s reach and sales driven motivation, but until now, no one had broad reaching numbers. Obviously, part of this study was to put this stamp on the industry, but also a nice push for EA, and the video games industry as a whole, stating, ‘We’ve got the space, technology, and platform – and now the proof that the method works!’

“Nielsen’s study is a milestone for interactive entertainment,” said Elizabeth Harz, Senior Vice President of Global Media Sales at EA. “For the first time, advertisers are able to link the value of their in-game marketing or sponsorship to actual sales. Now brands can feel confident adding gaming as a core media channel for their advertising.”

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Square Enix and Shanda Games to bring Final Fantasy to Chinese Market

Friday, September 17th, 2010

Marking the first ever appearance of FINAL FANTASY on Chinese shores, Shanda Games Limited and Square Enix Co., Ltd. have announced a strategic partnership that will employ Square Enix’s library of content and Shanda’s experience in game development, publishing, and distributing in China. To kick things off with a bang, both parties have agreed to launch with FINAL FANTASY XIV, a title that’s sold 97 copies worldwide, and has never before been seen in China.

square_enix_logoSeeking a win/win situation, Square Enix points to globalization as one of it’s top priorities, and has been appropriately developing and distributing global titles targeted at Japan, North America, and Europe. This partnership with Shanda will now give Square Unix unprecedented access to the lucrative Chinese market.

“The media entertainment markets are increasingly becoming more and more global in nature. Under this environment, we are speeding up our globalization strategy aimed at transforming our Group into a truly world-class enterprise.” said Yoichi Wada, president and representative director of Square Enix Holdings Co., Ltd. “Through this partnership with Shanda Games, a company with great success in online game operations in China, we are taking an important step in increasing the reach of high quality content from the Square Enix Group to even more customers around the world.”

On Shanda’s side of the table, they’ve just scored a well respected and experienced games maker to call one of their own. That’s not to say that their current stable of offerings isn’t impressive enough, they’re now just adding to the quality count.

“We are excited to have Square Enix as a partner and I look forward to leveraging our capabilities and synergies for the benefit of both companies,” said Mr. Alan Tan, Chairman and CEO of Shanda Games. “Our in-house game development team is well-qualified to assist in the localization of FINAL FANTASY XIV to the China market, while our strong sales and marketing capabilities and extensive game operation platform can provide access to the broad audience of Chinese gamers. Since its debut in 1987, the FINAL FANTASY franchise has attracted many devoted fans worldwide and, based on our experience and expertise in the China market, we are confident in the success of FINAL FANTASY XIV as well as other future collaborations with Square Enix in China.”

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