Subject: [NEXTEL-1] Video games make big leap to small phone screens

From: Marcel <[email-masked]>
Date: Tue, 26 Nov 2002 03:59:24 -0500

http://biz.yahoo.com/rc/021125/bizfeature_telecoms_games_1.html

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Reuters

Video games make big leap to small phone screens
Monday November 25, 2:52 pm ET

By Ben Berkowitz and Yukari Iwatani

LOS ANGELES, Nov 25 (Reuters) - The next time your cell
phone rings, it may not be simply an incoming call but a hot,
new video game that has finished downloading.
Gone are the days when a cell phone was just a phone. At
least that's what wireless telephone companies want to believe
as they upgrade their networks, and handset makers expand the
capabilities of cell phones.

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All sides involved are looking for new services that will
make their phones more attractive -- especially to the coveted
youth market -- and help recoup the hundreds of millions of
dollars spent in development costs.
They are hoping video games will do just that.
"The games are great. They get better and better all the
time," said Fadio Olinero, an avid player, who spends 10 to 30
minutes a day playing games in his spare time .
"You actually see characters, you see pictures, you
actually see a bowling ball and pins and you see a guy swinging
a club. Whenever you have some free time it's a great way to
relax and take off some stress and have fun," said the 33-year-
old executive of a Los Angeles-based distribution company.
While it is still too early for the games to fully
replicate the fast pace and magic of computer and television
games, analysts believe mobile games may be the best way to
attract customers, especially young people.
"It has more potential to strike a cord and to attract
significant demand than things like location-based services or
mobile commerce," said Michael Doherty, a wireless industry
analyst with Ovum. "People have their favorite games that they
like to play. You bring some version of that and you have a
ready-made audience. You're not selling something brand new to
a brand new user segment."
He added, however, game developers and device makers must
be careful in setting expectations because the target audience
is accustomed to playing more sophisticated electronic games.
"You can't disappoint this group," he said.
BUSINESS IS GOOD
The research firm IDC published a report last week
estimating that U.S. wireless gamers will multiply more than
tenfold, to 71.2 million in 2007 from 7 million in 2002.
The rise of games comes as the cellular carriers move to
advanced high-speed networks with data transmission speeds that
are in some cases, more than a dozen times faster than old
networks. Carriers hope features like games, ring tones and
graphics will push adoption of those networks.
The games themselves cost anywhere from $2 to $15 or more,
depending on monthly subscriptions fees, the frequency of
downloads and other variables.
"Business is really good, business is actually really above
our expectations," Mitch Lasky, the chief executive of mobile
phone game developer Jamdat, told Reuters,
Jamdat is perhaps the most well-known of the wireless game
companies. Lasky is a former senior executive of Activision
Inc. (NasdaqNM:ATVI - News) and his company has deals with most of the major
game publishers. Its games, primarily in the sports genre, can
be played on Sprint PCS (NYSE:PCS - News), Verizon Wireless (NYSE:VZ - News; London:VOD.L - News), and AT&T Wireless (NYSE:AWE - News) telephones.
"Wireless data has been talked about and talked about for a
long time here in the United States, but has not taken off
relative to other countries," said Bill Stone, vice president
for marketing at Verizon Wireless, the largest U.S. wireless
telephone company. "With color (screens) being that entry
point, now we really have something to capture the imagination
of our customers."
Verizon's Stone said they had seen "a tremendous uptick" in
wireless games since launching their offering.
THE CURRENT NICHE
Still, challenges remain.
"I think there's an opportunity there, but I think it's
always going to be limited until the value-added capabilities
are seen," said Phil Redman, a wireless analyst with Gartner.
Redman believes devices have to become sophisticated enough
for users to play graphically rich multiplayer games with
opponents around the world before usage will really take off.
Current multiplayer games are still relatively simple
although companies like Jamdat and Sorrent are looking to
develop multiplayer titles. Sorrent was started by Scott Orr,
who designed some of Electronic Arts Inc.'s (NasdaqNM:ERTS - News) top games
before leaving the No. 1 game publisher.
"I think it's a niche right now," Redman said, adding that
mobile games must also be attractive enough to compete against
Sony PlayStations and Nintendo GameBoys.
Greg Santoro, vice president of Internet and wireless
services for Nextel Communications Inc. (NasdaqNM:NXTL - News), acknowledged
in a telephone interview that games will likely take a little
while longer to really take off.
"This Christmas could be an interesting indicator of
interest overall," he said.

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