A few months ago, I wrote about my feelings regarding the best opportunities on mobile for social game companies, particularly how I saw the iOS vs Android battle playing out (https://lloydmelnick.com/2011/06/30/ios-vs-android-the-battle-for-social-mobile-gaming-supremacy-lessons-from-history/). That post has led to a larger conversation, how should social game companies prioritize the various mobile and web social opportunities. Having been in the game business for almost twenty years (contributions accepted in lieu of condolence cards), I have seen my share of companies fail because they missed a migration to a new platform or get rich as they anticipated a platform change early.
My philosophy is that you should focus on being nimble and ready for new platforms rather than trying to anticipate the future. I have the same attitude towards financial analysts; they are no more likely to anticipate the future than monkeys throwing darts at a dartboard. Some will get lucky but most will underperform the mean over time. It’s the same in the game industry. It is actually quite arrogant for you to feel you know the future better than other tech leaders, so instead of trying to outsmart them, out hustle them.
Some of you may be asking why is this even an issue, Facebook is the big kahuna and you can make a lot of money being successful on Facebook. Yes, yes you can. But should that be your focus, or only focus, for 2012, for 2013 and beyond. Mobile is clearly becoming a crucial area for consumption of social media. Facebook itself is being accessed by over 350 million users a month via mobile devices. Social games on iOS are regularly among the top grossing apps. Even on the Web, Google+’s growth has exceeded all expectations (most recent figures put it at over 50 million users) and some social games are already generating more revenue on Google+ than their Facebook equivalents.
Looking at 2012 and beyond (which is the release date for any good game recently green lit), the decision becomes even more difficult. First, do you develop for Facebook. Although the biggest opportunity, there are well over 500,000 games and it is VERY expensive to rise above the noise. The next decision is whether to develop for the other web-centric social networks. The most obvious of these is Google+, whose growth has been phenomenal but staying power is still uncertain. Then there are the non-US social networks. Do you try to enter the Asian markets through RenRen, DeNA, Cyworld, etc., where there are more potential players than you have in the US? Do you risk the three-headed social monster in Russia – Odnaklassnike, Mail.ru and vKontakte – where piracy is still rampant but some games earn more than comparable Facebook titles? Should you spend time with the European social networks that are still battling Facebook, and often winning in their territories, like VZnet, Hyves, Nasza Klasa and Tuenti?
Mobile represents the same level of challenge. iOS is clearly the leader right now in the mobile space, but they you also develop for Android? This is a bigger challenge than just adding another social network, as Android develop entails optimizing for a myriad of devices with different displays, sizes, processors, etc. So even if you are developing for Android, you then need to pick the devices. Should you focus only on optimizing for the Fire, betting Amazon will be the main challenger to Apple, should you support the Samsung line of phones and tablets, should you go even broader?
I would argue also that the mobile decision is not simply Android versus iOS. Although a small part of the market now, Windows phones have a potentially bright future. Microsoft’s Nokia deal ensures these phones will get a huge opportunity, especially in Europe where Nokia is still a big dog. Counting out Microsoft and Nokia is still a huge risk. Despite the well documented woes Research in Motion(the Blackberry manufacturer) has experienced competing in the smartphone market, they still have double digit market share, global strength especially in the corporate sector and a lot of seasoned mobile executives. Again, you are taking a risk assuming they cannot turn it around. And finally, let’s not forget HP and WebOS. The TouchPad was obviously initially a failure, to the point of it getting “cancelled” and the CEO being fired, but the surprising demand for it at a lower price point may have changed the game. HP, the world’s largest seller of PCs, still has tremendous distribution worldwide, low-cost manufacturing expertise and the WebOS (formerly Palm) operating system that has been critically acclaimed. With Meg Whitman at the helm, it is too early to write HP off, either.
What to Do, What to Do
As I said at the start of this post, it is folly to try to predict the future. It is an even greater folly to rely on me to, so if I said develop for Google+, iOS and WebOS, your best bet would be to run away and delete your bookmark to my blog.
Instead, you need to shape your platform and development strategy to reflect this evolving landscape. If you have five games under development, do not focus them all on the same one or two platforms but provide options so you are protected if the environment shifts dramatically. If your company’s strength is Facebook, for example, have all products developed for Facebook but have one include a Google + version, another include an iOS SKU, another include Android and Windows, etc. The important feature here is diversifying your risk rather than betting you know exactly what the landscape will look like in the future.
On the development side, ensure the games are built to be ported easily to other platforms. I have worked on projects where development was poorly documented and so much was hard coded that we literally had to hire a team of hackers to reverse engineer the game to get it on another platform. This not only adds to your costs but slows your ability to adapt to market changes, so competitors get on the platform before you do. Instead, put in the time initially (which actually is not much time) to ensure that your products are well architected and easily modified for other platforms.
There are two final points I want to make on this post. First, do not try to alleviate the platform risk by developing for ALL platforms. That strategy guarantees you make multiple mistakes (i.e. developing all titles for a dead platform) and increases your cost and development time significantly. You can achieve the same expected ROI by creating a smart portfolio and moving quickly as the market evolves. Second, make sure your decisions are not US-centric. There is a huge market outside the United States and by looking at opportunities on a global, rather than San Francisco, perspective you increase your potential market and lower your risks
Although this post was a little longer than I would of liked, the importance of properly incorporating platform decisions in your strategy can mean the difference between success and failure. Make sure you look at all the options, both on the web and on mobile devices, and rather than trying to guess which ones will succeed create a portfolio that ensures success regardless. And build your products so if you are wrong, and everyone is at some point, you can quickly adjust and not even have to admit you were wrong.