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Game Developers Conference Recap

March 11, 2005

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San Francisco had gorgeous weather to welcome game developers from around the world. Attendees noted that there was more energy this year, but it was energy born of desperation. Gamers are enthused that online gaming continues to grow and now there is mobile. Furthermore, EA has screwed the pooch online despite making a show of the fact that online is the future, so smaller companies should have space to grow.
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But let’s face it, online games in particular continue to suffer from an inability to monetize their expensive creations. We talked to one VC who is studying this space but we couldn’t think of any companies to tell him about who are seeing explosive revenue growth. One analyst report, from Instat, just projected that online gaming will be a $3B industry by 2007. That’s cat scratch given that the report found that online games already account for 9% of net traffic. Online game makers are stuck in a Catch 22 where they can’t support games via banners ads and they get terrible conversion rates when trying to take credit cards. As for mobile games, its a new promise but a tiny market.
The après-show buzz was that nobody could believe Real picked up an open bar tab at the W Hotel bar, where waitresses were pushing shots of Glenlivet on patrons. Gamers were even more impressed with PuzzlePirates’ after-party, perhaps because who would think that puzzle guys, albeit pirates, would know how to party?
Read – Online Gaming Anything but Fun and Games (Instat)

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