EGB Roundtable: Branding to Go: Pros & Cons of Licensing in the Mobile Space

Electronic Gaming Business, Dec 17, 2003

Conventional wisdom holds that game publishers should enter emerging platforms such as mobile with familiar brands, known quantities that have builtin audiences and can help early adopters get used to the new technology. This is only partially true, according to a recent roundtable of mobile gaming experts assembled by Nokia and moderated by EGB. While familiar game brands do help secure deals with mobile carriers, poorly executed licenses and games that fail to leverage the unique attributes of this platform could also alienate gamers from mobile gaming.

Our panelists for this discussion are: Karine Kaiser, head of marketing, Gameloft ( kkaiser@gameloft.com ); Juan Montes, managing director, Jamdat Europe, ( jmontes@jamdat.com ); Kristian Segerstrale, head of business development, Macrospace ( Kristian.Segerstrale@macrospace.com ); Vesa-Pekka Kirsi, senior manager, Games Applications, Forum Nokia ( vesapekka.kirsi@nokia.com )

The full transcript of this hour-long exchange will be available to EGB subscribers only at http://www.electronicgamingbusiness.com/VIP/roundtable.htm . Subscribers will need their account number to access the transcript. If you do not know your account number, call 1-301-354-2100 and a client service representative will help you.

EGB: Do mainstream game publishers suffer unrealistic expectations for the worth of their brands and the sales potential in the mobile space?

Montes: Yes. On occasion you need to show the type of downloads being done by the key operators to get a realistic revenue figure. The [US and European] markets are very different today and that's really the kind of tricky part -- not letting people be guided by some of the analysts' agenda that say the market's going to be hundreds or millions or even billions in 2004-2005.

Segerstrale: Volume from any particular title -- be it a branded title or a non-branded title -- is very, very difficult today. For example, our best selling titles have sold up to half a million copies this year, so we have that as the benchmark on the past. However, moving forward, the market is growing between 10 and 20 percent month on month, so trying to project that forward is difficult. Also, volumes are very dependent on the kind of co-marketing campaign that you can secure with the major operators and that in turn will depend on the strength of a brand as well as what mood that particular operator happens to be in -- and that is very, very difficult to predict. It's a space where deals are done very, very individually, depending on the strength of the property as well as what kind of co-marketing you can secure from the actual brand-holder. We have a strategic relationship with Turner Broadcasting for their Cartoon Network properties, and in some territories we secured very strong co-marketing from their side and that certainly helps us in our revenue projection.

Kirsi: Branding is a complex issue in the mobile space where the brand owners are not quite clear on the whole idea of the mobile space and what that means. I think it is something that for the year to come, we need to work together to clarify the whole mobile space: what it actually consists of, what are the different platforms, how do you sell your brand.

EGB: Is misuse of brands damaging mobile gaming?

Kaiser: The brand-holders often fuse all the content together. They group ring tones, logos, and mobile games. For the movie companies, th mobile content is one key marketing tool. It is part of the overall marketing campaign of launching the movie. They don't necessarily look for making a good mobile game but just having content for mobile devices. The way we see it is that operators are looking more and more for quality. I think in 2004 we really see them looking more and more [carefully] at what games they actually put on sale on their portals because they just cannot get 100 or more games per game category.

Segerstrale: I think there is a trend generally with service providers, and I include carriers as well as portals, to be more and more careful in the kind of content that they elect to co-market and that those decisions may be based on brand. They can also be based on innovative, cool new features like multi-player play, shared high scores competitions. Some of our strongestselling titles are our own brand labels. Many times we feel as a company that branding seems to be almost more important for the network operator or the service provider than sometimes it is for the actual end customer -- that the end customer sometimes simply buys what looks cool and what looks good and what's easily accessible from the game service, whereas for network operators they see this as a little bit like retailers in the traditional space look for beacon brands, so that they look for a particular brand which highlights the availability of the service.

EGB: I am hearing two different things here, that carriers rely too heavily on branded games and that they are veering away from it.

Juam: It's in a state of evolution. The more experienced, savvy operators, the ones that already maybe have portals developed -- we see that for example in Verizon -- are keeping a better, more healthy balance of brands and non-branded and even put money behind properties that are not branded properties. Bowling, for example, has done over 2 million downloads already here in the U.S. A lot of other operators still see brands as a way for the end consumer to notice the game service. I think one of the challenges for us when talking about co-marketing with operators is to have common goals in this - not to have a brand just to make it look user-friendly, but for a content provider, our goal when we use brand is to drive traffic and download business. Sometimes those goals do not really come together and do not translate into the right return for a content provider. [But] We have seen a couple of examples where the game really flopped on the video games platforms, but it has still attracted probably as much interest from some operators as some of the more established brands here.