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Exit Games CEO Harald Behnke

Software provider Exit Games was founded in January 2003 and now has officers in San Francisco and Hamburg. The company's core product is Exit Games Neutron, a mobile multiplayer solution designed to connect operators and users around the globe.

Here, CEO Harald Behnke tells us more about Exit, the need for the mobile industry to exploit the opportunities offered by multiplayer gaming and what kind of shape he believes mobile gaming is in at the moment. To begin with, can you just explain a bit about the history of Exit Games and what it is that you do?
Harald Behnke

Sure. Exit Games is a middleware provider for mobile, multiplayer and online connected gaming. So we are an enabling company for the games industry, helping others to develop and deploy all forms of connected games and entertainment.

We are partnering with the mobile operators, IP vendors and other companies in the mobile industry because it's to their benefit that new forms of connected entertainment are developed.

The company was founded in 2003. We operate out of San Francisco and Hamburg, and deploy games in more than 50 countries via more than 100 portals and carriers. You used the phrase "connected gaming" there - what does that concept mean to you?
Harald Behnke

We use connected gaming for more or less all functions which use the network for entertainment applications. It's a very broad definition.

Obviously, there's multiplayer, be it in real time or turn-based. It's also all forms of in-game communications like messaging, chat and all that stuff. It's also other forms of connectivity, for example asset and content downloads, e-commerce, and so on. There are also forms of communities, be it high scoring, ghost racing, stuff like that. So it's a very broad definition around online and connected games. Regards multiplayer gaming, how suited do you think mobile phones are to that particular strand?
Harald Behnke

Definitely. There are two things. On the one side, this device, and the whole infrastructure behind it, make it the most social technical device of our age.

There's a natural fit; people use their phones to talk, to text and to play with each other. The technology is simply there after years of development; we now have all the bits and pieces together, and it really works. What benefits does multiplayer gaming offer mobile publishers?
Harald Behnke

From a commercial point of view, it's quite simple; it doubles or triples your revenue. Through community online gaming, level purchases and stuff like that, you have a longer customer relationship, which is essential because in many regions of the world distribution of mobile games is a critical thing.

It's quite complicated to get people buying mobile games; many people do not know where to buy them. So when someone does buy a game, it's very important for publishers to have upselling opportunities or, say, subscription-based models.

There are other things like creative benefits, but I think the commercial part is number one for the publishers. That's the reason why this whole sector has a take-up right now, but hasn't had a take-up in the past, because there was no chance to get more revenues. Do you think mobile games companies are exploiting multiplayer gaming as much as they could be?
Harald Behnke

Yes - we see that in the US and for 2006 we can definitely say that most of the growth we had at Exit Games came from there. In that market, if everything is ready, the networks are there, the subscription billing method are there, plus all the big publishers are looking to jump into the mobile space... Yes, we definitely see them exploring all forms of connected gaming.

There are some publishers on the market who are not quite sure, especially if they're operating in Europe or some parts of Asia where traffic is still quite expensive. So then the publishers are not sure how aggressively they should enter this domain. But I haven't talked to a publisher who isn't making plans. How would you describe the status of the mobile gaming market generally at the moment? Do you think it's looking healthy?
Harald Behnke

I think it's in transition. It's something which is quite boring for console and PC publishers, the transition phase, as it's been well known in this industry for 20 years; in the mobile space, it's still quite new, and the shape of the transition is not quite clear.

In the first phase, we had black and white gaming. Then came the second phase, 2D colour gaming, and we're now entering the third phase, where all forms of connectivity plus 3D are coming on the technology side.

So now the industry is trying to work out what it can do with these new options. Of course not every game can be 3D or be connected, but you see that change is happening. There's a lot of consolidation on the publisher side and a lot of segmentation on the consumer side - core gamers versus casual gamers and so on - so at this point the industry is in transition to the third generation. How optimistic are you that the industry will emerge from this phase to find itself in a better position, especially since there are so many companies competing now?
Harald Behnke

It really depends on your point of view. We'll see a lot of winners and losers in this transition. One very positive effect is that the big boys and large publishers from the console and PC space, and even from the media, are all entering the mobile sector.

Of course, since EA bought Jamdat, every publisher at top management level knows that there's a demand for this sector. We see it as a very positive trend, because we see more professional behavior; we see publishers clearly working with developers, and a lot of structures from the established industry are coming to the mobile space. This is very positive.

I think there are some risks for smaller companies, especially in Europe, because the powerful US players are gaining momentum. We've seen a lot happening from the US and Europe, but we see there's a lot of market power coming from the US, and it will be difficult for some smaller European companies to find their place.

Summing up, it really depends if you're one of these companies or if you're working for one of the bigger players. As the boss of a European company yourself, what is your strategy for competing with the US?
Harald Behnke

Our strategy is supplying them. We definitely have an advantage as a technology company coming from Europe, in timing and knowledge about the mobile space. We see that with our US success after just one year, working with top companies from over there.

Being a supplier for the games industry is an advantage because all the big boys come in, and they're used to using middleware technology - like we offer - as they do in the PC and console market.

This transition makes things a lot easier for us because the big companies are used to working with technical outsourcing, be it developers or middleware companies, and I think that's the main point. The more the industry shapes and professionals, the better things will get.

As all these big companies enter the market with next-generation content, many of them 3D, many of them with connected stuff, this will also really drive revenue. So we see this as a positive development.

Harald Behnke is CEO of Exit Games. Interview by Ellie Gibson.

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