March 24, 2009

Videogame Conference Likely To Focus On Casual Gamers

The videogame sector is hoping for a rebound this year by focusing on casual gamers and videogames for mobile phones.

Analysts and industry executives expect videogames to show strength despite the economic recession due to the hours of entertainment they provide, and because they are relatively inexpensive at around $50 a title.

The videogame audience is also expanding beyond its traditional base of young males to a larger audience through products like the Apple iPhone and Nintendo's Wii.

At this week's Game Developers Conference, 300 exhibitors will showcase their technology in PC, mobile, online, and console videogames, making the conference the largest professionals-only event in the world.

Organizers say the event provided a platform for the launch of Nintendo's Wii, which is now the world's best-selling console.

"The phenomenon that's driving sales this year is that a big chunk of sales are to a much, much more casual audience than we have historically seen," analyst Michael Pachter told Reuters News.

According to research group NPD, U.S. videogame hardware, software, and accessories are up 11 percent in 2009.

"We're in a hot category that's growing," said Michael Howse, chief executive of Bigfoot Networks, which is launching a new version of its gaming network card at this week's conference.

"Our general view is that we're certainly impacted on the consumer spending side," he said, "but for some reason, consumers have a few extra dollars in their pocket to play games."

Still, some game publishers are still feeling the economic pinch.  Electronic Arts has already cut 1,100 positions, and is closing 12 facilities, in preparation for losses in 2009.

Casual consumers continue to keep the market afloat as they flock to titles like "Wii Fit" and "Guitar Hero." 

A videogame is "still a great value for the money, and it's also got a nice social aspect to it now," said Meggan Scavio event director at GDC.

Casual games have become the new board game, Scavio added.

On Wednesday, Nintendo President Satoru Iwata will give a keynote address.  In 2005, Iwata spoke of a new console called "Revolution." The console was eventually released as the Wii in 2006.

The console has outsold Microsoft's Xbox 360, and Sony's PlayStation 3.

On April 5, Nintendo will release its new handheld device, the DSi, in the U.S.

Mobile gaming is likely to be a key theme at the conference, as it is becoming an emerging market.  According to estimates, more than 6,000 games are now available for the Apple iPhone and iPod Touch.

One videogame developer for the iPod Touch and iPhone, Ngmoco, has 26 employees and has sold almost 7 million copies of its games.

"We underestimated just how voracious the appetite was for customers who were purchasing games," said Ngmoco Chief Executive Neil Young.

"They're starting to spend money on a run-rate that looks like it matches or exceeds the type of spending for traditional consoles."


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