What will 2008 bring to video gaming? Other Platforms.
Let us begin with the iPod and iPhone. Apple (NASDAQ:AAPL) can see a lot of money here and are working to create a major gaming platform. Earlier iPods lacked the horsepower, but the iPhone and iPod Touch correct that fault. Because of the iTunes distribution system, this platform could be ramped up very quickly indeed to an already well established user base. This could well be the biggest growth area in gaming this year.
In the meanwhile, Nokia (NYSE:NOK) continue to mess up their nGage platform. In 2003 Nokia had the potential to create the most popular gaming platform on earth and instead they embarrassingly made every mistake that was available to them. They are trying yet another tactic this year that may work for them, but the evidence of history is not on their side. A pity, as we are headed towards a universal pocket device and Nintendo (OTCPK:NTDOY) could have owned the market, yet they squandered first mover advantage.
The PC has matured into an interesting gaming platform. It has been in a downwards slide for some years for boxed games at retail. However, for MMOs, casual gaming and for Steam it has grown massively. Also the effective banning of online gambling in the USA has forced companies to put their resources into online for money skill games. This will grow a lot during 2008. The companies with a gambling background will make a lot of money from this, showing up the lack of vision of traditional game publishers.
MMOs have grown under the effect of World of Warcraft which brought strong social networking to the genre. Other MMOs have learned this lesson and we will see the results of this during the year. Non subscription business models will also increase, Habbo Hotel being a powerful role model of this. As for genre, we must be reaching the time when something other than swords and sorcery will work. It is overdue.
Steam is hugely important to the whole future of gaming. It must make Valve worth billions of dollars. The addition of social networking at the end of last year was a genius masterstroke. For serious hardcore gaming Steam is rapidly becoming the only show in town. It is a great example of what a team of very clever people can achieve.
Another group of gaming platforms that will show very strong growth this year are the social networking sites. MySpace and Facebook are now both open to third party developers. Their huge user base guarantees that games have a great potential. It is a pity that so many developers can see no further than data mining. Combining online for money skill games with social networking user bases could be a license to print a vast amount of money.
Mobile phone gaming will continue to be a niche due to the fragmentation of platforms and carriers. However the potential is massive... they are ubiquitous. The current complex business model could well die out as much stronger business models run by the platform manufacturers come along. Apple and Nokia are the obvious ones, but look out for Sony (NYSE:SNE), Microsoft (NASDAQ:MSFT) and Nintendo entering this space.
There are loads of other gaming platforms from in flight seat back entertainment to SCUBA diving computers. They all sit in their respective niches and make business for those that service them.