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iPhone market "turning out to be like the rest of the industry"

iPhone market "turning out to be like the rest of the industry"

Thu 22 Mar 2012 6:14pm GMT / 2:14pm EDT / 11:14am PDT
MobileBusiness

Ready at Dawn boss talks about the sad reality that a few publishers control most of the money

iPhone games have blown up - one look at Angry Birds or Draw Something shows the massive potential in mobile. That said, it's not as easy to make money in this space as you might think. Ready at Dawn boss Ru Weerasuriya recently commented to GamesIndustry International that the sector is actually looking more and more like the traditional games business everyday.

And that doesn't bode well for the era of garage games and independent development on the platform.

"I have a lot of friends working in that environment, and the funny thing is that I know that it's a great environment to be in because I love playing those games and I know that everybody does. But people have too easy a time thinking that, 'Well, it only costs this much and we're gonna make money,' and it's not necessarily the case," he warned.

"Now you see these conglomerates really controlling the biggest and best or most money making titles, which, I don't know, it's kind of disheartening a little bit"

Ru Weerasuriya

Weerasuriya continued, "I mean, if you really look at the market, at the thousands and thousands of games that are out there, there's a very, very, very small percentage of them that literally do make money and their success is only shared by a very few big publishers on that front as well."

That's not to say that indies can't succeed on iOS, but Weerasuriya's remarks are certainly worth listening to. The App Store is filled with far more failures than successes. Rovio, remember, made over 50 games before striking it rich with Angry Birds.

"It's not the independent guys that are really doing it [on mobile], so the scary thought is that it's kind of turning out to be like the rest of the industry, which I'd hoped it wouldn't be; I'd hoped that it would be a very independent based industry. But now you see these conglomerates really controlling the biggest and best or most money making titles, which, I don't know, it's kind of disheartening a little bit," he lamented.

As for the traditional games market, the predicament of escalating costs isn't getting any easier with next-gen on the horizon, but companies are finally getting smarter about their strategy and product portfolio to mitigate risk.

"It's a scary thought that our budgets, in some ways, have gone up and up and up. It's a necessity, an absolute necessity," said Weerasuriya, who's currently working on an unannounced next-gen project. "The one thing that I think we're learning how to do better as an industry is to hedge our bets."

He continued, "There was a time where you could throw ten darts at the wall and hope that one sticks, and that's what some publishers used to do. They used to be like, 'well, if we fund enough games, hopefully one will cover the rest.' I think, unfortunately, with the downturn of the economy, a lot of companies, actually, are not around anymore now. But at the same time, I think that allowed for a lot of publishers to kind of look at the market or the environment of developers that are out there and really target the people that they wanted to go after. It's good in some ways, because, as an independent, it gives you a little bit more freedom to really have a choice for what you do. There have been a lot of independent developers that end up having to take a game because they have to, not because they want to."

Ultimately, publishers are being much smarter about games today, said Weerasuriya. "There will be less big, big, big budget titles... The bigger budgeted ones are going to be very targeted, very smartly chosen I'm hoping. I've already seen that from publishers themselves. They're doing more due diligence than they ever were entering in."

11 Comments

Jim Webb Executive Editor/Community Director, E-mpire Ltd. Co.

2,271 2,440 1.1
Who didn't expect this at some point?

Blue oceans don't stay blue oceans.

Posted:2 years ago

#1

Bruce Everiss Marketing Consultant

1,692 594 0.4
Here is the UK top grossing App Store chart:
1 Angry Birds Space
2 Draw Something
3 Poker by Zynga
4 Bejewelled Blitz
5 Design this Home
6 Dragon Vale
7 Draw Something Free
8 Match.com
9 WhatsApp Messenger
10 Tom Tom

Rovio and OMGPOP have come from nowhere. Smaller publishers like Full Fat, Back Flip and Neon Play are very successful.
What massively differentiates the App Store is the very low cost of entry, which encourages innovation. So the bedroom coder still has a chance. This is just not true of the console market which has polarised into a small number of very big budget blockbusters that are sequels.
Hence the top ten publishers on console and the top ten publishers on the App Store, whilst they do have a few names in common, are mostly different.

The big problem with the apps business is gaining visibility, it is the most fiercely competitive market that has ever existed, however time after time great apps have gone viral and have succeeded on their own merits.

It is true that most apps don't turn a profit, but very many of these don't deserve to. Go and look at all the Frogger games, for instance, many of these are just dire. To succeed in the App Store requires higher production values than to succeed on console. Firstly because there is vastly more competition, secondly because the community matters more and thirdly because mostly people can play the game before parting with any money.

Posted:2 years ago

#2

Antony Carter Senior Programmer, Epic Games

85 47 0.6
Visibility is the biggest problem on app store, there's just so much crap on there you drown before you even launch, unless your in Bed with apple or one of the big publishers on there. Yeah anyone can make apps at home, but other than for the fun of it there's very little point, unless you can get in with a publisher.

Posted:2 years ago

#3

Private Industry

1,176 182 0.2
It took them 30+ games to have one hit, barely any off the well know app devs have success with their first app and they need years to have one it and they still have to prove they are more than a one hit wonder. Right now they are like musicians that have one lucky hit and no other known songs that try to monetize the crap of that one single song before they fade away.

So far they are all one hit wonders without a prove of being able to follow that up with a new IP. The best an app dev can hope for is get a lucky hit, sell the company for a lot of money as long as you do well.

Dont tell me you think Angry Birds has higher production values than many console games.

Edited 3 times. Last edit by Private on 23rd March 2012 9:49am

Posted:2 years ago

#4

Martyn Brown Managing Director, Insight For Hire

140 51 0.4
The AppStore has potential for break-out hits (of which there are many; AB, TinyWings, Draw Something, Flight Control etc etc etc) - the traditional closed console market does not offer this.

It's fair to say that traditional publishers will increasingly "own" the space due to promotional ability, advertising and the introduction of both higher production values and known/quality IP.

Posted:2 years ago

#5

Private Industry

1,176 182 0.2
XBL and PSN have many hits that came from indies nobody knew before. I think indies have a better chance on making money if they make games for XBL or PSN than the flooded app store where you fight for visibility against many bad apps.

Posted:2 years ago

#6

Rolf Moren Freelance Marketing Consultant

36 22 0.6
I keep wondering how people think that the AppStore has been easy money when in fact it, for many years now, have been the toughest market of them all. When people say that most apps don't make any money they are basically very wrong. The hard truth is that basically NO apps make money enough to sustain even a one man studio. Never has the words "don't quit your day job" been so true!

Posted:2 years ago

#7

Peter Dwyer Games Designer/Developer

482 293 0.6
Large companies can spam the market but, are not able to compete on price or innovation. This means that it's more than possible for an unknown to get out there and make it big on these platforms.

This is not true of normal channels where the price to entry means that only large companies get a look in. Sales dropping in those closed channels should also tell everyone that the constant spam of <<generic sports title> 2012 or <<generic FPS>> version next is starting to loose it's appeal to many people. Attempts to take these titles over to phones and tablets at premium prices have met with failure all around.

Basically in the App space it's still a good day to innovate.

Posted:2 years ago

#8

Bruce Everiss Marketing Consultant

1,692 594 0.4
@Rolf

Someone tell Charles Forman that.

Posted:2 years ago

#9

Stephen Richards Game Deisgner

68 28 0.4
I'm losing count of the number of 'the app store is not a gold mine' type articles I've read. This is not a novel economic phenomenon: as soon people notice one queue is shorter than the others, they all rush to fill it up.

Surprisingly little attention has been given to the thought that perhaps this is a good thing: with no guarantee of profits, it may be (in the long term) only people who make games as a passion who remain. Of course big companies with huge marketing budgets are going to dominate, this doesn't mean indie developers have no chance at all.

As for visibility, like the article says, it took Rovio a lot of tries to make a hit. Why not make five or ten simple, free games and use them to advertise a paid one? Obviously this requires investment and risk, but that's the case with any business. The joy of the app-store is that anyone can make games for it, not that everyone can make a profit from it.

Posted:2 years ago

#10

Emily Knox Associate Designer, CCP Games

50 113 2.3
I agree with Stephen, I thought the iPhone market had been oversaturated for a long time now, people have been reinforcing this for a while.
Unfortunately quality doesn't guarantee that a game will become visible, without a marketing budget it's hard to get people's attention, but not impossible (I think at the time I actually referred to Bruce's own blog for help with this, "15 ways to market a game for free").

And again, the accessibility is the beauty of it, without it I wouldn't have completed a valuable year in work experience prior to finishing my degree. My main wish now is for Apple to exercise tougher control over the titles they approve (those "Pokemon" games, for example).

Posted:2 years ago

#11

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