In the first part of our interview with ngmoco's Neil Young, the former EA exec discussed the genesis of the company, raising millions to fund the start-up, and why he's convinced the iPhone is here to stay as a gaming platform.
Here, Young discusses the changes he'd like Apple to make to the iPhone, why lazy publishers could be the biggest threat to the platform, and the why he expects the pricing structure of iPhone applications to change as the format becomes more established.
Q: Is ngmoco strictly an iPhone publisher, or would you like to think there are other opportunities out there for your business?
Neil Young: We're strictly iPhone for now, but we would never rule out other formats, that would be a silly business decision. The thing that was exciting for me in the first place about the iPhone is the realisation that its capability combined with usability was changing my usage patterns for non-game things. And that capability is clearly changing people's usage patterns for software, applications and games. Until there's a device that has that same blend of usability and capability, it doesn't seem to me that it's worth investing our energy against it. Especially when this is so new. Some of our free games have been installed up to four million times. Apple is training people to go and get software, and we know from our research that those people are also buying paid games too. They're not buying them at the same rate, but it's just a matter of time before somebody makes the killer app on the paid side. And maybe it will be easier to consume because it's got in-app commerce. This is just an incredible opportunity out there that we just have to go after.
Q: So what's you relationship like with Apple? They obviously don't make any games, they put the hardware out and the SDK and let everyone else get on with it...
Neil Young: It's good. It's really good, but it's not preferential. We fight and manage for that relationship just as much as anyone else. I do think the iPhone and the app ecosystem, the reason that it is that way is because Apple chose not to develop software. They think of themselves as a hardware and operating system company. Over the last five or six years they've come to be a content delivery network as well, but they don't think of themselves as entertainment providers. And that shows in the quality of the tools they give out. Look at operating system 1.0 and then operating system 3.0 and the types of functionality in those devices. You get an update to your PSP OS and it represents 1/100 of a functionality of a iPhone revision. And that's because they've got hundreds, thousands of people focused on constantly advancing the software.
When I first started the company I thought it was dumb that Apple wasn't building first-party software and I imagined the relationship was going to be much more like a first-party – we'd get a certain number of slots, there would be a super-long approval cycle, it would be hard to get software out. But meeting with them, they were up front in saying that they are an OS company and they create the market place and they want guys like us to fight it out. They said "if you're trying to be the spiritual software company for this device, if you want to feel like the first-party developer, then that's fine. Go for it, hope you win."
Q: What else would you like to see Apple do to improve the hardware or the SDK to in-turn help ngmoco create better games? The first thing has got to be the battery life, right?
Neil Young: I certainly would like to see the battery life improved. I think there's a lot that can actually be done with the software to make the battery life improve. This is just my own anecdotal observation but whenever I don't have a signal my battery dies ridiculous fast, and if you're in a place where you get booted off the network and put back on it's almost as if you're watching you battery drain. I hope that will change over time.
I'd like to get access to the raw video feed out of the camera because I think that could enable some really interesting types of games. We've got some games that we're working on that are location based but they need some pieces of functionality to be available to us for them to be really worthwhile. And then in terms of the marketplace itself, the better the search and discovery tools that Apple has, the better it will be for those that are trying to make high-quality applications.
And outside of Apple I'd love to see a place where I can go and get information for iPhone games. Seven quarters after the release of the DS and PSP there were websites dedicated to those things and every major gaming website had a section for them. Seven quarters after the release and the iPhone and iPod Touch has exceeded the installed base of those devices at the same time, and yet it's really, really hard to get clear information. You have to go all over the place for reviews and information. But I want it to be on the device.
Q: Comments from users in the App Store can only go so far, some are intelligent and helpful, but others are a little loopy...
Neil Young: Sometimes it's helpful. Sometimes it's just really abusive [laughs]. It's depressing to see a high-quality game like Topple get a comment of "Meh, balancing blocks is stoopid". And it drops from and average of five stars to four and a half instantly.
Q: What do you think to the pricing structure of games in the App Store? I see titles for 59 pence or 99 cents, but then I see more traditional videogame companies offering titles for GBP 5.99 or USD 9.99. No matter how good that higher priced game is, if it sits next to 10 games that are much cheaper, it's going to suffer, surely?
Neil Young: I don't think there should be a pricing structure because it's early in the lifecycle of the platform. It's almost like there's super-heated behaviour and there's this explosion of apps and developers. But at some point that has to slow down because the economics for only a small percentage of those people are actually viable. That's going to change, I don't know how, but it has to.
What I don't want to see happen is a 'Premium App Store'. What that would do would encourage publishers to be lazy which is the biggest risk that the device faces. When the PSP came out, and one of the reason I actually think the PSP didn't succeed in the same way the DS did, is because publishers just ported their original PlayStation games. So the PSP had more software at launch that any other gaming system had in history, but it got off to a really slow start because it didn't offer gamers anything different. I don't want to see that happen here. I don't want to see a premium space where a successful franchise is just inserted onto the device. I'd like to see it more like Nintendo's world where there's a reason Nintendo dominates the top 20 on the DS. Because they're the people that make the best games for it and they've been really thoughtful about it. I tend to want to encourage things that keep the level of innovation there.
I think a big, big change is going to be in-app commerce. What's going to happen initially with in-app commerce is everything will trend towards 99 cents as the entry price for a game and gamers are going to start getting really wary about that they are and aren't buying. Because they're going to feel like they've stepping into a money trap. It's 99 cents for a portion of a game. It's going to be difficult. We have to be really careful not to prioritise greed over gameplay. There's going to be a bit of a rough period as that works through the system. We're not going to charge 99 cents for a rocket launcher. That would be a really bad idea from a gameplay point and it would be the fastest way to piss off your consumer. People would be outraged by the mere concept.
Q: So you see a future for micro-transactions on the iPhone, keeping a game relevant with regular updates?
Neil Young: The sale of virtual goods is pretty significant. It's definitely an implementation difference. You've got to be really careful – you can sell content packs, which happens a lot. Like in The Sims where you buy a collection of objects. What you can't really be buying in those models is discrete elements of gameplay for cash. If you do that you create an imbalance in the game's structure. What you could do is let people - who are willing to pay - exchange money for time. People who are willing to put in time could still get all of the in-game objects. You need a system, if you use the rocket launcher as an example, that someone can earn that through time invested in the game. But you also need the system for someone who doesn't have a lot of time to participate in a ranked match against others who have the same weapon, that lets them do that. And then there's downloadable content, a set of maps for example.
Q: Finally, you recently secured another USD 10 million in funding – what's that ear-marked for?
Neil Young: Two things. The first is to invest in more premium products basically, like LiveFire. So you'll see less free and 99 cent applications from us, and more meatier apps. The second is for investment in our software platform. We have a really big update of that coming that adds a lot of functionality. We want to find ways to get that into the hands of as many people.
Neil Young is founder of ngmoco. Interview by Matt Martin.