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September 5, 2000

Wireless gaming: the killer mobile application

Mobile operators and manufacturers will also be desperate for a piece of the gaming action: premium wireless content will boost sales and tap new revenue streams. The participation of mobile portals will be crucial to kick-start the market, as independent gaming sites will otherwise find it hard to reach an audience.

By CBR Staff Writer

Games publishers are gearing up go wireless.

A new survey from Datamonitor forecasts the market for online gaming in European and the US – currently tiny – has the potential to reach $1.6 billion by 2003 and a staggering $6 billion by 2005. By then, around 200 million people will be playing Internet games on their mobiles.

However, the business model for games publishers is not straightforward. Initially, sponsorship will be the most lucrative revenue stream. Contests sponsored by third parties or dependent on customers paying a nominal fee will prove successful. The promise of a reward together with the entertainment factor will be a winning combination. Subscriptions will also find a receptive audience for customers who prefer to ‘pay and play’. However, this business model will only happen once GPRS – a faster wireless networking technology to be introduced in 2001 – enables the creation of high quality games.

The huge forecast revenues can only be tapped if mobile gaming can reach a wide audience. Handset adoption will not be a problem, but due to the complexity of configuring handsets and a lack of familiarity with wireless Internet, mobile operator portals will be crucial to successful distribution in the short term. Games developers will need to be present on these portals to reach their audience. Nevertheless, as new handsets allowing for easy browsing are developed, consumers will increasingly leave mobile operator portals to play on independent gaming sites. Mobile operators will eventually have to find yet another tactic to maintain their audiences.

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