Wireless Mobile Gaming

FEATURE ARTICLE: Canada.com Press Release

Wireless arcade: Companies confident gamers will pay to play

Peter Hum
CanWest News Service
Monday, February 09, 2004

As they rang in Chinese New Year, James Wong and his employees had plenty to celebrate.

His fledgling startup, Motile Interactive System, spent last fall transforming the stuff that mesmerizes gamblers -- roulette, blackjack, keno, craps -- into interactive games that can be played on cellular phones. Wong, a 17-year veteran of Nortel Networks, believes these kinds of mobile games will wow them in Asia. Wong says he has already lined up a well-connected partner who will try to root out interest in his product in China, with its 269 million cellphone users.

Until recently, Motile's labours existed only as an emulation on company computers. But after Wong's workers got their hands on a long-awaited cutting-edge Nokia 6600 handset, it took just a day to move their technology from an emulation to a reality that Wong was keen to show off.

Moving the phone's tiny joystick and clicking its keys, Motile's president and chief operating officer placed a bet. With another click, Wong ordered the server in the room next door at Motile's office to spin the virtual roulette wheel shown on his phone's screen.

He looked up from the phone and smiled. "I won." The server added credits to his balance. "It's not fixed," he assured.

"Now people can bet anywhere," Wong bragged. He envisions casinos in Macao -- or anywhere in Canada, for that matter -- offering clientele the chance to gamble anywhere, anytime, legal issues notwithstanding. Cellphone carriers too could woo customers with no-stakes versions of the games.

"At the end of the day, we're going to help them sell more phones."

Around the world, at companies large and small that have pegged their livelihoods on mobile gaming, this kind of optimism practically bubbles over.

While skeptics think twice, disparaging the limited computing power of mobile gadgets and their tiny screens, mobile gaming's supporters remain certain that they are in the right place at the right time, creating entertainment technology's next big thing.

Mobile games, of course, are not new. What's new is that they have improved radically. In their rudimentary forms, mobile games debuted when carriers first streamed data to cellphones on the so-called "wireless Internet." Bell Mobility, for example, offered text-only trivia games in 2000. By the end of 2001, wireless gaming was Bell Mobility's most popular data service, outshining retrievals of stock quotations and e-mail, says Ken Truffen, Bell Mobility's director of business development and data marketing.

Cellular technology has since advanced, from wireless application protocol (WAP) phones to graphics-friendly, colour-screen devices that use the Java programming language. "That's a huge turning point in the wireless gaming industry," Truffen says. "It's like going from DOS to Windows." Bell Mobility offers 70 mobile games for between $3 and $7 each, downloaded over the air.

With the spread of Java phones in North America last year, the continent has begun to catch up with the global interest in mobile games, ranging from branded, miniature versions of console favourites such as Sega Monkeyball and Cyber Tiger Woods Golf to digital Backgammon and Reversi. In Canada, three of the four cellular carriers -- all but Fido -- have launched Java phones. Alex Thabet, vice-president of business development at the Montreal-based mobile gaming company Jamdat Mobile (Canada), estimates the number of Java phones in Canadian users' hands will rise to two million at the end of 2004 from 400,000 a month ago.

As if they were trying to out-do one another, research firms have issued rosy forecasts, fostering mobile-gaming cheer. Sharp rises in revenues are predicted, with Strategy Analytics, for example, last year estimating wireless gaming will generate global revenues of more than $7 billion by 2008. Hard to believe? A July 2003 report by the Research Room pegged global wireless gaming revenue, including game purchases and traffic revenues, at a staggering $41.3 billion US.

Manufacturers are on board. Some are designing gear for hardcore gamers -- devices for gameplay that, by the way, take phone calls. Last October, Nokia released its N-Gage game deck in 60 countries and, according to results released recently, shipments of the device in 2003 reached more than 600,000 units. Sony is said to be building a competing gadget, dubbed the "PlayStation Portable," for release later this year. The Samsung A600 (also a camera phone) can be accessorized with a "RadPad" docking station that includes buttons for shooting and menu access -- all the better for gaming.

With their service plans lean and competitive, carriers see new profits to be made, especially if they can tap into the huge "casual gaming" market -- people who, for example, might not spend hours gaming at their computers, but might enjoy a game of chess while waiting for the bus.

"Mobile gaming represents a tremendous revenue growth area for consumer wireless data services," says Paul van der Zanden, product manager for games for Rogers Wireless. In the next few years, as subscribers upgrade their handsets, the consumer base for mobile gaming should grow exponentially, van der Zanden foresees. As devices gain more memory and perform better, there will be increasingly compelling content, he adds.

Large companies churning out games include Gameloft, THQ and Jamdat Mobile. For every large operation, there are scores of smaller firms and independent developers with big plans such as scoring licences for sexy name-brands and developing multiplayer interactive games.

Hexacto Games, which has been Jamdat Mobile (Canada) since May last year, may be the shiniest role model for Canadian mobile gaming companies. At its spacious two-storey quarters in Old Montreal, Jamdat is 70 workers strong and growing. Its parent company in Los Angeles includes about 50.

Thabet cites one analyst's forecast, which envisions wireless games generating more revenues in 2007 than computer gaming does now. "Obviously an optimistic picture," he smiles.

He reins himself in. "In 2004 and 2005, we're going to start seeing important growth," Thabet says. He swells with optimism -- but look how far it has gotten him so far.

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