Cellphone Gaming Lacks Pull

By Mike Musgrove
Washington Post Staff Writer
Wednesday, May 3, 2006

When it comes to buying and playing video games on a mobile phone, many people have tried it -- but few ever try it again.

A report by Seattle-based M:Metrics released yesterday found that prices, choice and lack of interest were the biggest factors that have kept cellphone video game sales from growing in the United States.

Less than 3 percent of cellphone users are buying and playing games on their phones -- and that number hasn't grown much in recent months.

"There's revenue to be had and companies are making a living," said M:Metrics analyst Seamus McAteer. "It's just not growing."

McAteer said the phone interface that consumers access when downloading games -- which usually lists only game titles -- is one of the biggest reasons behind the slow growth. As a result, the games that tend to sell best are those with instant name recognition among consumers, such as Pac-Man or Tetris.

"It looks like Craigslist instead of iTunes," McAteer said of the interface. Without a more vibrant shopping experience, he said, the market will have trouble growing further out of its niche.

For the video game industry, cellphone users represent a highly attractive market. While a few million avid game fans might have purchased the latest game console from Microsoft, it's a minuscule number when compared with the billion or so people worldwide who carry cellphones.

Game publishing giant Electronic Arts recently acquired mobile game maker Jamdat in a deal worth nearly $700 million -- the biggest acquisition in that company's history.

Anders Evju, general manager of I-play, a company that makes mobile phone games, agreed that some cellphone carriers have done little to build interfaces that encourage users to download games but said he expects a shift as phone graphics improve and download speeds increase.

"From our perspective, revenues are growing nicely, month over month," he said.

Still, some researchers wonder if consumers ever get much use out of gadgets that allow for multimedia features or video games.

Researchers from the University of Maryland at College Park recently conducted a study of what they call "feature fatigue." They concluded that Apple's iPod has possibly been such a success because it is primarily an easy-to-use music player -- not a phone or a personal digital assistant, too.

"People thought they preferred a lot of features, but then when they actually used the product they found they preferred a much simpler device," said professor Roland Rust, chair of the University of Maryland's marketing department. "Even the tech-savvy suffered from this 'feature fatigue' effect," he said.

The M:Metrics report comes a day after a report from research firm NPD Group found that, despite the popularity of camera phones, only 20 percent of users take and transmit pictures with them.

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