Live from iGames Summit: Lessons Learned

We're here live at the iGames Summit in San Francisco. It should be a great event for iPhone game developers interested in learning more about design and monetization. Here are our live notes from the kickoff panel discussion - Lessons Learned: Why iPhone Games Work - including: Neil Young, ngmoco Andrew Lacy, Tapulous Steve Demeter, Demiforce LLC (Trism) Keith Lee, Booyah Moderator: Ken Gullicksen, Morgenthaler Ventures Ken Gullicksen: What's working? It the iPhone a replacement for the Ninendo DS, casual games, both? What's resonating in the marketplace? Nail Young: What's interesting about the iPhone is it touches all different types of customers. Mobile gaming normally means short types of game play. What isn't immediately apparent is how people are playing with the device in longer play sessions. The avarage play session for Mazefinger is 8 minutes, for Orlando it's 22 minutes, and the average user play 10.5 times. It's a lot like handheld gaming, and that to us is something that's really exciting because it speaks to deeper engagement and thus more opportunity to monetize the experience. Steve Demeter: Being an indie shop, by nature we're going to build games focused on shorter play sessions. We make a game every couple months. Ken Gullicksen: What's working now in monetization, and where does that go? How do you monetize in different ways? Andrew Lacy: We're lucky because we make music based games and the iPhone is both a gaming platform and a music player. It's not that much a stretch for our players to buy a paid extension of the free version of the game. Thinks are still shaking out, and Apple has done an incredible job accomplishing so much so quickly, but everyone in the room could name 5 things they want to be able to do better. The announcement 2 days ago signals that Apple is moving in that direction. Keith Lee: Our goal is to hit the top of the charts, and we haven't seen a ton of falloff from free to paid apps. Ken Gullickson: How does virality happen in this world? How does promotion happen? Is there a role for publishers, or does the app store handle all of that for you? Neil Young: The app store is awesome - it provides a frictionless distribution mechanism right in your pocket. It's just like Walmart or Best Buy. Really the role of the publisher from the marketing standpoint is to figure out how to get their software to stand out above the noise. We do PR activity ahead of releases, a growing relationship with a core set of influential customers, and probably most powerful is the cross promotion within our games. The app store is going to continue to develop over time, and that's going to be super exciting for the entire ecosystem. You're still going to have 25,000 - 40,000 apps a year being released into that ecosystem and being able to target people you have relationships with (either customers or points relationship) might be one of the ways marketing can happen in that space. When we localize our apps in French, Spanish, Japanese, etc, QA, there are a set of services that are valuable to developers but also to customers. Steve Demeter: I agree with everything you said, but nothing you said was fun. I had so much fun writing Trism, and I looked at it like I was marketing it entirely virally. If you have an idea that can be easily conveyed in 10-30 seconds, you've got yourself a hit. I told my friends, and that's it - I didn't do marketing, and I think a lot of guys out there doing iPhone games have jobs and are wondering what will happen if this hits. Most guys don't want to raise venture money, they want to have fun with it. Andrew Lacy: For me, I think the analogy is the Facebook world. One of my employees created an app the first week the Facebook Platform launched and has something like several million uniques within a month. Now, Playfish has 100 employees and has the same amount of uniques. I do think those kinds of hits are going to become more and more rare. We're professionalizing because we know that's what our competition is doing. The state of the art is improving. Neil Young: One of the great things that's happening in all this is the birth of new development talent. At the end of the day, you also need people not just who are good at Objective C but who also understand how to build things correctly for the device. We deeply admire Nintendo because they're deeply aware of the capacities of their hardware and design with that in mind. The iPhone is a unique device, there are things for gaming in this device that have never been thought of before - your contacts list, network connection, media. It's going to be exciting to see where it goes from here. Ken Gullicksen: How much of that is happening in bigger companies? Is this a minor brand extension to them, or do they have people that get it? Andrew Lacy: All of these guys are looking at this world, and are developing for the iPhone. It's such a different device, and to some degree the big studios are hampered by that - you can't just roll your title out to 100 mobile devices or you'll get the lowest common denominator. People focused on the iPhone do have an opportunity to focus on what makes the device unique. Keith Lee: A lot of people ask why Blizzard isn't making iPhone games, but they want to focus on their core areas. There are so many different opportunities and ideas as a big game developer and publisher, you always have to ask when is the right time to link an iPhone product to WoW, or should we develop new IP? It takes a lot of inertia to create a completely different group focused on the iPhone. Ken Gullicksen: What's the scale here? 30 million, how long until we hit 100 million iPhones and iPod Touches? Neil Young: Well, I don't think it's slowing down. Virality happens when you have the device in your pocket and you show it to your friends. I don't know when they reach 100 million units, but I think it will get there faster than the DS did. Keith Lee: Assuming there are 30M units now, I wouldn't be surprised if we hit 100M units by the end of next year. Steve Demeter: I agree it's not slowing down, and for very good reason. Ken Gullicksen: So what are the roadblocks now? What's holding innovation back, or is it smooth sailing? Keith Lee: If you want to make a more complex application, the limit on the ad hoc program with 100 users makes it very difficult to test your app out at realistic loads. A lot of developers face the same sort of issue. Andrew Lacy: What's still a share of mind roadblock is when you think about social on the iPhone, part of the problem is that particularly outside of Silicon Valley not that many of your friends actually have one, so your ability to use social or viral networks to grow your application is a lot harder. With Tap Tap Revenge, we wanted to connect you with people you share interests with, so the question to me is how strategically important is it to be on other platforms - be it other platforms, Facebook, etc. It may not be that important when we have 200 million iPhones, but right now, social is still a problem. Ken Gullicksen: Are any of you building for Android or other mobile platforms? Andrew Lacy: We haven't decided to do that as a company yet, that would mean we'd have to hire 200 people. We're thinking about it. Keith Lee: It's not a matter of if but when... Question from Audience: If your app doesn't make it into the top 50 or top 25, how do you promote your app? Steve Demeter: At the end of the day, being in the app store is pretty big, and that's the lay of the land. If I was a first time app developer, would I use a publisher? Maybe. The only publisher I would maybe go with would be Neil Young, and that's because he's invested in by the iFund, which is Apple's money, and they have a vested interest in making sure they succeed. Neil Young: I don't think we get a lot of preferential treatment because we're an iFund company, but we're happy to take advantage of promotional opportunities when they come around. We do the best we can to promote the device by building games that specifically take advantage of it, and my sense is that message resonates with Apple. Keith Lee: It's very different now than it used to be in August. Andrew Lacy: We've been featured twice, and to be honest, I think being in the top 10 is really important, but word of mouth is the most important. We haven't considered being featured the most important lever in driving sales. Question from Audience: Is there evidence that there is institutional support within Apple to build a great games platform? Acting as a committed steward like Sony, Microsoft, Nintendo. Neil Young: None of us can speak for Apple, so it's hard to say. When we first came to the platform, we imaged that Apple would function like Nintendo or Sony, that they would manage it very tightly. But it became clear very quickly that they see themselves as stimulating a marketplace - much more like an operating system company and platform provider than a first party game platform company. I've worked on every console under the sun, and hands down by far Apple has provided the best development environment and best tools - I'm not sure they would be able to do that if they were focusing on all of these different areas. All of these APIs take a lot of time and energy, and I'm thinkful that they're spending their time on that rather than trying to figure out how to be a game maker, which is not really in their core competency. Question from Audience: To what extent will the iPod Touch make a competitive difference in the success of the iPhone as a gaming platform? Andrew Lacy: It's quite possible that Apple didn't know they were making a gaming platform like it turned it to be - they may have thought it was going to be more about things like Urban Spoon and stumbled onto this. Their focus has shifted and now they're really focused on games: Editor's Note: Why didn't anyone answer this question more directly?

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Live from iGames Summit: Lessons Learned - Why iPhone Games Work

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