Back in 2003, one analyst predicted that today’s mobile games market would be worth $18 billion. In fact, it’s worth just $2.5 billion. What went wrong?
That was the theme of Robert Tercek’s keynote The First Decade of Mobile Games. The GDC Mobile founding chairman walked through the past ten years of deals, games and technical innovations, and sought to find out why the mobile games sector has failed to live up to those early promises.
He said, “$2.5 billion is a big number and something that we should be proud of. But why isn’t it more than that? Why isn’t it $18 billion? It’s difficult to believe that five years ago, people were saying that today’s mobile games market would be worth more than the PC and console games market combined.”
He said the main problem has been a complex ecosystem which “looked more like a collision than a traditional value chain”. The needs of the telephony sector and the games publishing sector have never sat easily together, and that problem is still being worked out today.
There had also been a baffling array of business models and billing systems over the years from the sensible to the absurd. He said that these systems had, for better or worse, informed the creative content of mobile games.
The business environment has also been extremely competitive with hundreds of acquisitions. This had been driven by carriers who did not want to deal with too many publishers or developers, and by the limited number of slots on carrier decks. The end result had been a creative environment driven by publishers and not by developers, usually a recipe for cautious, safe, slow progress.
Echoing Trip Hawkins keynote yesterday, he also said that greed had been a factor, this time from the carriers. He pointed out that DoCoMo’s i-Mode, the most successful game service ever launched, had been marked by a low take on the carrier’s behalf (9%), while the failure of WAP was marked by an extremely high take by carriers.
But Tercek’s history of the featured many examples of innovation from game developers and from entrepreneurs, and Tercek said it was this that had enabled mobile gaming to grow, despite its inherent obstacles.