October 31, 2009

Nokia’s N-Gage Fails

Nokia Ovi will end its gaming service N-Gage next year, the companies first unsuccessful run of a major service, Reuters reported.

At the top of the list, Nokia plans to pursue revenue from online services - specifically games and music.  Its proven handset market will continue to mature. 

However, the handset maker faced serious challenges with its mobile gaming launch.  First, consumers rejected its dedicated gaming phones, followed by a flop of its major global advertising campaign.

The online gaming service started the N-Gage brand last year, and then never progressed beyond a select crowd of dedicated gamers. 

"We will no longer publish new games for the N-Gage platform," Nokia said on its N-Gage blog, to which a user calling himself Jon replied: "It's a sad day for N-Gage fans."

The company said the games from its initial major services offering would be available until the end of September 2010 and the community site would continue throughout 2010.

Analyst Tero Kuittinen of MKM Partners said, "It's a sign of a more realistic approach. It's time to bury the dead and focus on the future," adding Nokia had vast possibilities in other areas, such as location-based services, micro-financing and mobile email.

Because Nokia holds a positive reputation in the cell phone market, major mobile game makers like Electronic Arts, Gameloft, Glu Mobile, and Digital Chocolate were eager to develop special games for N-Gage.

Nokia will continue to sell mobile games at its Ovi Store, a comparable rival to Apple's popular App store, after N-Gage services terminate. 

Nokia's U.S. shares were 3.3 percent lower at $12.73 by 1750 GMT.


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