Metal Gear Solid Mobile

Konami Mobile is scheduled to release Metal Gear Solid Mobile to the US market this week. The game is earning high marks from the mobile-gaming industry for its impressive graphics and quality game-playing experience.

At this year's International Mobile Gaming Awards (IMGA), the game won both the Grand Prix and Operator's Choice Awards. Metal Gear Solid Mobile features never-before-seen dramatic 3D art displays and camera work that greatly surpass the current standard of mobile games. In the game, players will face the same extreme tension of solitary infiltration that fans of the classic tactical espionage action game have come to expect from the Metal Gear Solid series, previously released to the PlayStation and PlayStation 2. The game also takes advantage of the phone's camera functionality, for example using the camera to sample colors from the real world for an in-game camouflage system.

You can watch an interview with Chad McNeill, Konami Mobile's Marketing Manager here and read BusinessWeek's review here (4.5 out of 5 stars).

According to the BusinessWeek story, Metal Gear Solid Mobile will cost either $3.99 a month or $9.99 to buy outright through Verizon Wireless, which will have exclusive rights to the title for three months before it becomes available through other networks. Konami says the game is compatible with about 30 handset models in Verizon's lineup.

LinkedIn Mobile Demo

One of my favorite websites - Linkedin - has launched a mobile version of their site. Just go to http://m.linkedin.com/ on any mobile browser.

the basic functionality is all there. You can look up people’s profiles, invite people into your network, and see updates from your contacts.

To see a demo of the site working on an iPhone, check out the video above.

Back from GDC

The Movaya team was in San Francisco this week for GDC. GDC Mobile took place Monday and Tuesday and then the broader games industry took over on Wednesday.

We were very busy over the three days we were there, with over 20 meetings so we didn't have any time to post news on the site this week, but we will try to backfill interesting stories over the next couple of days.

We didn't spend any time at the sessions but having talked to lots of folks, the general theme surrounding the mobile game sector is that alternative distribution channels are the new focus for the vast majority of mobile game publishers. Moconews posted an article earlier this week titled: "The End Of Carrier Control In Mobile Gaming May Be Near" and from the discussions we had, this is definitely moving from talk to reality.

Now, to be clear, Movaya's interests are 100% aligned with off-deck or non-carrier mobile content distribution, so we are certainly biased, but let me provide some color on what is happening in the US market and you can make your own conclusions.

Of the 15 or so mobile game publishers we talked to this week, the majority said "2007 was a challenging year". Why was it so challenging? Well, it is broadly known that over 90% of the mobile games purchased in the US are sold by the carriers directly, meaning 4 stores (Verizon's Get it Now, AT&T's Media Mall, T-Mobile's T-Zones, and Sprint's Game store) control nearly all the mobile game distribution. And when you are reliant on only 4 channels for distribution, your risks are significant.

Point #1 - Carrier Game Business

- Verizon's business was great for just about everybody as their technology platform works well and they have made some minor investments to improve merchandising, etc.
-AT&T was generally flat from 2006 to 2007 because, although their subscriber base increased significantly, their technology infrastructure is inferior and they had a whole bunch of new customers who love to play games but couldn't buy anything (iPhone).

-T-Mobile continues to plug away but they experienced significant organizational restructuring which caused different issues for publishers.

-Sprint is cratering; they are losing subscribers and employees by the minute and no one's paying attention to the store. I heard one significant publisher say: "Focusing on Sprint right now would be a waste of resources".

So, what does all this carrier info mean? Well, if you have a good relationship with Verizon you probably did OK in 2007. In fact, someone told me that Gameloft generated 50% of their US revenue from Verizon.

Point #2 Cutting the number of partners

All of the 4 major operators in the US made significant cuts to the number of direct partners they would work with moving forward. Rumor has it that AT&T went from 25 or 30 direct partners to 6 "premier partners" and 6 additional partners. This means that roughly 20 companies lost their direct relationship with AT&T. Ouch. This does not mean that their games won't show up on-deck but the path to that deck just got more complicated and more expensive.

If you don't have a direct deal with the carrier, your new process for getting your game carried means working through one of the direct publisher partners or one of the certified aggregators. Both of these routes create issues for the non-direct publishers.

- Aggregators: these are intermediate third party companies that sit between the game publishers and the carriers. Their job is to "pitch" the game concept to the carrier and then run interference between the carrier and the publishers for accepted games. They generally make 15% of the revenue for their efforts. The potential value of these aggregators is understood. Carriers can't manage hundreds of independent partners; they simply aren't resourced appropriately. The aggregator can take on a lot of the operational tasks and filter out the lousy developers. Unfortunately, at least what I hear, is that none of the publishers like the current aggregators. I'm sure there is a certain amount of sour grapes here but hearing the stories of failures in what I would call basic tasks is brutal. Furthermore, the aggregators are providing very little value (technical or sales) to justify their 15%. Bottom line: if you're a publisher who used to work direct, but now works through an aggregator, your revenue just got cut by 15%, while your costs stayed the same and your control is diminished significantly.

- Other Publishers: Mobile game publishers like iPlay have now gotten into the business of aggregating games from other publishers. If you have even half a brain you can probably quickly understand the challenges with this model. Although the game publishers are most likely way better operationally than the aggregators and their knowledge and ability to sell into carriers is superior, you have a major conflict of interest here. Let's say iPlay is going to release 12-15 games this year. Their primary focus is to get these games placed on deck and get these games sold. That in itself is no easy challenge, and now they are going to effectively get other publisher s games highlighted as well? Not to mention the fact that now one of your competitors has access to your sales reports? Sounds risky to me.

Now, most game publishers have no choice. If they want to stay in business and not completely bleed cash, they will determine which path to the carrier deck makes the most sense and work that channel to keep the lights on. But, in parallel, all of these companies are either already investing in alternative distribution or are actively investigating their options. In a later post I will discuss the off-deck distribution options for mobile game publishers in more detail but here are some of the quotes we heard from publishers this week:

1. "Our focus in 2008 is on direct-to-consumer. We know this business is small today but we have to start investing today to be ready when this market matures."

2. "Our focus in 2008 is to broaden our distribution by making web based versions of our mobile games. By making web based versions, people can play our games online, and then we can provide a path to purchase the game for their phones."

3. "Our focus in 2008 is moving from a mobile game publisher to a digital lifestyle brand. Mobile will continue to play a big role but the broader web is critical to achieve the growth we need."

Furthermore, Movaya measures the growth of the off-deck business by watching the number of content developers and merchants who sign up to our service and are seeing very strong growth month-to-month here. (We'll have more to report on this soon as well.)

If we did miss you at GDC, please drop us a line or we can plan to get together at the next tradeshow - CTIA Wireless (Las Vegas, April 1-3, 2008).

Tapatap.com

Looking for something fun to do on your mobile phone? Point your phone's browser to m.tapatap.com or click here to have the URL sent to your phone.

The company reached out to us recently to review their offer and we've had some fun playing with it over the last few weeks.

They describe themselves as:

"Tapatap is "Your Contest Community" offering infinite contests for fun and prizes. Create your own contests to share and enter your photos to win. Explore the community and see how your votes stack up. Tap enough points and take home some goodies! Our mission is to create social entertainment networks where you and the community are the fun. You create it, share it, and play it wherever you are across both the web and mobile devices."

Here's our assessment:

Tapatap is a new (and cool) twist combining gaming, photo sharing and social networking. At its heart Tapatap is an online "community" where you play contests to win prizes. The twist is that the contests are created by the community rather than by the company.

You can win prizes in 3 ways:

1. By submitting photos in contests - as a contestant, you can win prizes by winning the popular vote
2. By creating your own contests - win prizes by getting people to vote (tap) in your contests
3. By voting in contests - earn the most voter taps by voting in contests

There are daily, weekly and monthly prizes to be won and prizes can be cash or other items.

If you're intrigued, I would suggest you check it out online yourself and you'll understand how addictive the site is. Note: from the looks of the community, the site caters to the 13-25 set but I'm 35 and had fun...

Tapatap was founded by three entrepreneurs, Isaac Babbs, Andy Riedel, and Ken Scott, who wanted to create a fun and rewarding community that could be accessed from your PC or on the go. They raised $2.5M last year from Gabriel Ventures, an early stage venture capital firm based in Silicon Valley.

Give it a shot and let us know what you think.

M:Metrics Now Measuring China

M:Metrics, the mobile market authority on the consumption of mobile content and applications, announced last week the first large-scale study of mobile media consumption in China, the world’s largest mobile market.

According to M:Metrics’ December Benchmark Survey, mobile entertainment is popular among the Chinese, with an astonishing 34.8% reporting they listened to mobile music in the month, and 10% playing a downloaded mobile game.

“China is the most important market for mobile technology in the world, and I’m proud that M:Metrics has the distinction of being the first measurement firm to offer authoritative metrics on this large, growing mobile audience,” said Seamus McAteer, Chief Product Architect & Senior Analyst. “We are already seeing pent-up demand for this data among our client base, and will continue to report on this fascinating audience monthly through our MobiLens syndicated data service.”

To get the data, M:Metrics surveyed 5,163 Chinese mobile subscribers aged 13-54 via telephone in the capitals of Beijing, Shanghai, Guangzhou, Shenyang, Chengdu, Wuhan and Xi'an.

Mobile Game of the Year

Last night at the annual GSM Association (GSMA) 2008 Awards Gala Dinner, Glu Mobile's original title My Hangman was a joint winner of the Global Mobile Award for Best Mobile Game along with Cellufun's Call of the Pharaoh.

My Hangman is a casual game based on the classic word puzzles and was created and developed in Glu's London studio. The title features 1,000 different word puzzles, multiplayer modes, and the ability to put pictures of friends into the puzzles themselves. Upon its launch, My Hangman has seen strong performance critically and commercially including reaching the number one spot on T-Mobile UKs Top Ten Games when launched on the network.

"We're honored to have this Glu original title recognized by GSM, said Greg Ballard, President and CEO, Glu Mobile. This award is a testament to the strength and creativity of our development team in making compelling original titles."

In Call of the Pharaoh, you get a job as an inscriber, priest or engineer and work with your fellow CelluPharaohs to create the largest pyramid possible. You must depend on your fellow workers to gather the bricks and ropes used to build up the pyramid, and then call together the engineers to plan, the inscribers to decorate and the priests to bless your pyramid as it grows larger.



Commenting on Cellufun's entry, the jury said: "Call of the Pharaoh introduces social networking to games, you can't win this all on your own, you need to call in your buddies. Beware, don't start this just before bedtime or you will spend all night on it!"

Congratulations to both companies.

More Incredible iPhone Stats

First of all, Happy Valentine's Day!

The MobilePhoneBlog hopes everyone has a great day, whether you buy into Valentine's Day or not.

My wife is a happy one this morning as she got an iPhone from yours truly. Some of my friends think I'm crazy for giving such a nice gift on a second-tier holiday but if you're at all familiar with the sacrifices ones spouse has to make to support a startup business, you'll understand that it's the least I can do.

We haven't activated it yet but it will be fun to watch her use it as she has been carrying around some old crappy LG phone for years and her mobile experience is about to be blown away.

In business news, this past week was the Mobile World Congress in Barcelona and there was tons of news about new phones, new partnerships and such. Far too much for us to cover, but one news bit that came out from AT&T caught our eye.

During his keynote appearance Thursday at the Mobile World Congress, AT&T Mobility president and CEO Ralph de la Vega called Apple's iPhone "a game-changer," noting that since AT&T exclusively launched the device in mid-2007, mobile data consumption has grown dramatically. According to de la Vega, 95% of iPhone owners regularly surf the web, even though 30% had never done so prior to iPhone ownership.

"There isn't a device that's easier to use," de la Vega said. "The iPhone proves that price resistance is only as strong as the user experience is weak."

Enhanced devices and improved user experiences are driving AT&T mobile data across the board. De la Vega said that 13% of all AT&T customers now own a 3G device.

95% of users regularly surfing the web? Wow!

We called it first, and it seems like someone listened

Movaya was heard when it declared 2008 to be The Year of the Mobile Game. An article in the NYTimes today (Trying Again on Mobile Games, by Andreas Tzortzis), is dedicated to the mobile gaming industry.

Andreas talks about the Nokia N-Gage QD, which is the follow up to the gaming-centric cellphone Nokia introduced in 2003. The original phone came and went pretty quickly, though one of our founders still rolls with one. The phone looks like a cross between a game controller and phone, and looks very awkward when held to ones head, rather like a taco.

A key takeaway from the article is the fact that companies in the mobile space have not spent money on investing in gaming, yet. Movaya is positioned well to catch as much business as possible here, and we are getting excited for our bet to pay off.

The other key point is that data transfer cost is falling, allowing for the marketplace to loosen up in terms of the willingness of consumers to download games. It used to be that downloading a game cost more in terms of $/kb downloaded than in the actual cost of the game.

Glu 2007 Results

US mobile game publisher Glu Mobile (NASDAQ: GLUU) announced details of the company's sales results for Q4 2007 and for all of 2007. For the 4th quarter of 2007, Glu reported a net loss of $861,000, on revenues of $18.1 million. In the same period last year Glu lost $2.3 million on revenues of $14.3 million. For the full year, Glu lost $3.3 million on revenues of $66.9 million. In 2006, the company lost $12.3 million on revenues of $46.2 million.

The company said it is growing on three fronts—by securing long-term licenses, expanding geographically and consolidating market share.

Glu is hoping to grow through acquisition as well, having targeted British rival Superscape Group. (LON:SPS) If the acquisition goes through, Glu would become the second-largest supplier of mobile games in the U.S., and be close to market leader Electronic Arts (NASDAQ: ERTS). During the call, Glu said that its offer to buy Superscape expires Friday, and they will announce the outcome on Monday.

"We closed a solid 2007 with a strong fourth quarter," said Greg Ballard, Glu's chief executive officer. "Over the past 12 months, we significantly raised our market position by securing world-class, long-term licenses, expanding geographically and consolidating market share. Our title line-up for 2008 provides a solid foundation for our success in the coming year. In addition, we are focused on increasing our global opportunities with the addition of MIG and the proposed acquisition of Superscape."

Congrats to Cellfire

Cellfire, the mobile coupon firm, has raised $12 million in its third-round of funding. The round was led by Silver Creek Ventures, and was joined by return backers Menlo Ventures and Storm Ventures.

According to the release, proceeds will be used to expand the company’s sales and marketing efforts, along with increasing product functionality, business development and partnership activities.

Cellfire, founded in 2005, says it has distributed more than eight million coupons worth more than $24 million in discounts. Stores accepting Cellfire coupons include 1-800-flowers, Hollywood Video, Quiznos and Supercuts.

The funding comes as no surprise to us at the MobilePhoneBlog as we have been big fans of Cellfire for awhile.

"We are thrilled that Silver Creek led this round of financing given their strong track record of success in the wireless space," said Brent Dusing, CEO of Cellfire. "We have come a long way over the past three years, and yet there are many more opportunities that we see in the future. The additional funds will help us leverage the significant market opportunity at our door step."

To get Cellfire on your phone, click HERE.

Mobile Gaming Moving Beyond the Deck

Good news for folks in the mobile game industry. According to a new report from Parks Associates titled "The New Frontier: Portable and Mobile Gaming", off-deck sales of mobile games will grow from less than 10% in 2007 to nearly 30% in 2012.



This move to off-deck will enable the mobile game market in the US to grow from $700M in 2007 sales to $1.7B in 2011.



“Off-deck marketing and distribution, combined with new business models such as mobile game advertising, episodic content delivery, and micro-payments, will rekindle industry growth," said Yuanzhe (Michael) Cai, director of broadband and gaming at Parks Associates.

The article from eMarketer highlights how off-deck sales help the mobile gaming market grow in a few ways:

- Independent developers and publishers who don't have to have their games approved by carriers can potentially offer a wider range of game types, bringing in more gamers.

- Off-deck transactions could also mean more money to game publishers by reducing the carriers' cut. Similarly, such transactions could lower prices for consumers, prompting more sales.

This is music to Movaya's ears as we plan to help power a significant percentage of that $600M in off-deck game sales in the US in 2012.

Movaya Launches Free Trial Download Service for Mobile Games

Movaya TryNBuy to allow consumers to play mobile phone games before purchasing

Seattle, WA, February 07, 2008 -- Movaya, a mobile content distribution and services company, announced today the BETA launch of Movaya TryNBuy, the first off-deck, cross-carrier, try-before-you-buy system for mobile game sales in the US.

Over 30 mobile game publishers are taking part in the BETA launch, including top game publisher Com2uS. As a leading developer and publisher of original mobile games, Com2uS is always looking for new ways to reach mobile consumers," said Don Lim, general manager of Com2uS America. "With Movaya's TryNBuy, we know that once people are able to try out titles like the award-winning Tower Defense or our addictive stick-figure phenomenon, Super Action Hero, we'll be creating a whole new group of Com2uS fans."

TryNBuy is a patent-pending licensing system that allows consumers to download games over-the-air to their mobile phones and try games on their handset. Upon purchase, the games are ‘unlocked’ for unlimited use. TryNBuy is configurable on multiple levels including length of play, number of plays, and more.

“There has been widespread commentary on the factors holding back the growth of mobile games in the US. With our PlugNPlay launch last year, Movaya solved one of the major issues, which is to increase points of distribution. And now with TryNBuy, Movaya has solved the last remaining issue, which is the risk-free download for consumers. Try-before-you-buy was a major driver in the huge growth of casual games on the desktop and now Movaya is bringing this to the mobile marketplace.” says Movaya CEO Phil Yerkes. (see info below from Juniper)

To check out Movaya TryNBuy BETA, please visit www.bustedthumbs.com on your PC or www.bustedthumbs.mobi on your mobile phone. BustedThumbs is a direct to consumer merchant of mobile games and content.

About Movaya
Movaya (www.movaya.com) is a Seattle-based technology company, whose mobile-content management and distribution software system allows mobile content publishers and online retailers to effortlessly extend their businesses to the growing off-deck mobile content marketplace. Movaya PlugNPlay is the company’s flagship product, which brings together Mobile Game and Application Publishers, Online Retailers and consumers in one marketplace for Mobile goods. Movaya is powering the off-deck, mobile industry.

From MobileCrunch:

Juniper Research released a report this week that predicts mobile gaming revenues in North America will increase from less than $800 million to over $3 billion by 2012. (Incidentally, 2012 is the year the Mayan colander ends. I’m hoping they just ran out of rock to chisel on and weren’t predicting the end of the world.) 18 million Americans download or rent mobile games a least once per year, but Juniper predicts that as user interfaces improve and business models change, the number of mobile gamers will greatly increase. Juniper predicts that in-game advertising, free trial periods and better marketing will all come together to make mobile gaming a billion dollar industry in North America.

Another MVNO Bites the Dust

Voce, the Beverly Hills-based MVNO, has joined the likes of AMPD, ESPN and Disney MVNOs (Mobile Virtual Network Operators) in the dumpster, amid hundreds of millions of investor capital written off as a bad idea.

Yes, it is hard to run a carrier, and apparently even harder to run a virtual carrier. What is the lesson here? I think you need to consider what it means to build a brand over night, and how $500 million dollars, or having the backing of Disney, does not help. The exercise here for the executives at these failed MVNOs was to take a bunch of cash, build a brand overnight, come up with new and creative ways to market, and take customers away from giants AT&T, Verizon and Sprint (while turning around and paying those respective firms a fee for each subscriber since those networks ultimately hosted the end user). I suppose on paper it looked great.

What is the secret sauce that Virgin has to compete? Or Boost Mobile? Or Helio? What part of the success (or failure) is dependent strictly on brand appeal? ESPN had an offer for sports fans, Disney for kids, AMP'd for hip teenagers, VOCE for rich MoFos...and they all failed to attract a subscriber base to simply break even.

First, switching costs are huge for individuals. Rarely can a person simply switch carriers on any day they feel like, and I would think this is the top factor of the failure rate. With most US consumers locked into a 2 year contract, there was not even a chance to get these people to move in bulk. I believe a more holistic, organic growth plan should have been in order for a strategy here, and from what I can see, this has been Virgin's plan. Boost and Helio have followed the same path as the others, and their lifespan does not look healthy. Sell short.

History of the company here: What happened to Voce? [IntoMobile.com]

IN-FUSIO Enters Distribution Partnership with Movaya

Los Angeles, Calif. – February 1, 2008 – IN-FUSIO, a leading mobile entertainment company, today announced its partnership with Movaya, an off-deck, mobile content distribution company.

Under the newly formed partnership, Movaya will distribute IN-FUSIO's array of mobile content directly to the mobile marketplace. IN-FUSIO content will be readily available to the mobile community via Movaya's PlugNPlay system, a free to use ecommerce solution for mobile content.

"This new relationship with Movaya will bring our games and other applications to the mobile marketplace while allowing us to continue focusing our energy on developing high-quality mobile content," said Norman Evangelista, CEO of In-Fusio North America. "We expect it to be a highly beneficial partnership, with the end result being a greater selection of top-of-the-line mobile content for consumers."

"IN-FUSIO's unique and steadily growing portfolio of mobile content is a great fit for our PlugNPlay platform," said Phil Yerkes, CEO of Movaya. "We look forward to helping IN-FUSIO bring their games to a wider audience, and ultimately increasing their off-deck sales, using our streamlined system."

About IN-FUSIO
IN-FUSIO division is a leading international mobile entertainment company, publishing games and applications for cell phones worldwide. IN-FUSIO applications are enjoyed and available through more than 300 carriers and portals worldwide. IN-FUSIO's portfolio includes licensed applications based on Microsoft's Age of Empires® 2, and Zoo Tycoon® 2, Neopets®, Twentieth Century Fox's Die Hard, Canal Studio Image's The Terminator™, Tour de France, Golden Tee™, and original titles such as the award winning Shado Fighter and the famous Wallbreaker sold on more than 27 millions handsets. For more information, please visit www.in-fusio.com.

About Movaya
Movaya (www.movaya.com) is a Seattle-based technology company, whose mobile-content management and distribution software system allows mobile content publishers and online retailers to effortlessly extend their businesses to the growing off-deck mobile content marketplace. Movaya PlugNPlay is the company’s flagship product, which brings together Mobile Game and Application Publishers, Online Retailers and consumers in one marketplace for Mobile goods. Movaya is powering the off-deck, mobile industry.

Porn on any Screen

Interesting article by Reuters this week titled: "Porn to spice up cell phones"

Unlike in Europe, mobile porn has yet to take off in North America as carriers have been afraid of offending political and religious groups and parents concerned about children being exposed to adult content. Mobile porn in Europe is estimated as a $775 million industry in 2007 that will grow to $1.5 billion by 2012, with the global market reaching $3.5 billion in 2010, according to Britain-based Juniper Research.

In comparison, North America generated just $26 million last year in mobile porn sales. Most North American carriers have not even discussed offering adult service and the only one who has, Telus, Canada's second-largest phone company, withdrew a mobile porn service last year after complaints from hundreds of customers and criticism from the Catholic Church.

This is another case of "here we go again" as adult content has always played a big role in driving technology adoption. Back in 1997 when RealNetworks launched its first Internet streaming video system, a large percentage of the initial client interest came from the adult sector. Online porn is now a huge business and unlike a lot of other online video segments, the business model works well because consumers are willing to pay for access.

Certainly there are some technology requirements needed (age verification, etc.) but this is a train that's impossible to stop and if the carriers were smart, they'd figure out how to generate revenue here.

"It will be impossible to stop the adult business exploitation of mobile entertainment," said Gregory Piccionelli, a lawyer specializing in adult entertainment at law firm Piccionelli & Sarno.

Gameloft's 2007 results

French mobile game developer Gameloft (EPA:GFT) announced details of the company's sales results for Q4 2007 and for all of 2007. For the quarter, Gameloft had sales of EUR25.8 million, up 19% from the previous year. Full year sales increased by 40% compared to 2006, reaching EUR96.1 million.

The sales of downloadable games, which are the company's core business, reached EUR90.2 million during 2007, a 45% increase over 2006.

Europe represented 44% of sales for full-year 2007, North America 34% and the rest of the world 22%. The sharpest growth took place in the rest of the world, up 86%.

"The market shares gained by the company in 2007 are due to the strong performance of Gameloft's back catalog, which continued to account for more than 70% of the Company's downloads, and also investments in R&D made in 2007," said a Gameloft representative. "These investments allowed us to release more games than our competitors on more handsets across more countries. To date, Gameloft's catalogue includes 200 mobile games adapted to over 1,200 different handsets and sold in over 80 countries via direct distribution agreements signed with more than 180 carriers."

Gameloft is the biggest "pureplay" mobile game publisher in the world, and they are either #2 or #3 in market share for mobile games worldwide behind Electonic Arts (NASDAQ: ERTS).

Glu Mobile (NASDAQ:GLUU), the other #2 or #3 in market share, will issue its earnings release for the fourth quarter and year ended December 31, 2007 after the market close on Monday, February 11, 2008.