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.com, Leslie Walker

Where the Game Is the Medium

By Leslie Walker
Thursday, December 2, 2004; Page E01

Alex St. John is nothing like his hit games.

They are mesmerizing lullabies, transporting you into a relaxed state with their repetitive sounds, images and puzzles. The co-founder of game producer WildTangent Inc., on the other hand, is a booming bear of a man who clobbers you with one grand pronouncement after another.

"There are more people playing WildTangent games right now on the Internet than there are people playing games on the PlayStation 2 online," St. John declared during an interview over lunch in the District. "So I made gaming a broadcast medium."

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As St. John described how online games are beginning to intrigue advertisers and win over audiences, he sounded like one more Internet entrepreneur convinced he was inventing the Next Big Medium. He prattled on faster than "Super Granny," the cat-chasing star of one of his quirky games, about how WildTangent's software lowers production costs by allowing rapid creation and delivery of games.

Yet there is no denying his Redmond, Wash.-based firm has been on a tear this year. WildTangent has been selling 50,000 Internet games a month at $20 a pop and sharing revenue with partner sites where people buy them, including Yahoo, MSN, America Online and Shockwave.com.

The company's special sauce is software it calls a "Web driver," which allows graphically dense video games to be sent quickly over the Internet and played before the download is complete. "You can think of this as a Web browser for games," said St. John, a former Microsoft Corp. programmer known for making the Windows operating system more game-friendly.

In February, WildTangent became the provider for a new game channel that America Online created for its instant messenger software. AOL says users have collectively played the games more than 10 million times so far.

All told, WildTangent says its games, offered as a mix of free and premium versions, have been played more than 150 million times in the past six months. The privately held company expects to collect nearly $17 million in revenue this year, roughly half from advertising as merchants scramble to exploit the growing market for video games. "This might be the first profitable year for us," St. John said.

Yet the business model for Internet-only games, which tend to be shorter and simpler than those played on video game consoles, remains a work in progress.

The $12 billion-a-year video game industry relies mostly on offline sales for its income, with only a small portion coming from Internet gaming and an even smaller portion from advertising. Part of the reason is that the industry has yet to figure out how to measure how effective a video game ad is in reaching an audience.

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