What’s your temperature gauge on the space as it stands today?

The past 5-7 years we’ve had really good growth.  It’s gone from nothing to one report I read that said it’s going to reach $4 billion this year and nearly $10 billion by 2011. And then there’s another report that recently came out from Pricewaterhouse Coopers that said the overall gaming industry is going to be $50 billion by 2011 meaning mobile will be about 20% of the total overall gaming business.  Then there’s other research from companies like M:Metrics that talk about how only 5% of consumers have downloaded a game in the U.S. 

So from my perspective – and I’m a glass-half-full type of guy – if we’ve gotten that kind of growth and only 5% have downloaded a game, there’s a lot of untapped potential there.  If we just go from 5% to 10%, with numbers we have now, what pace of growth are we going to see by 2011?

There are things that need to be addressed, but it’s still a very positive road ahead.

Speaking of things that need to be addressed, what are some of them?

One of the main things is that ringtones and wallpaper have been the two main revenue drivers for mobile content, and mobile gaming is done fairly well, but I just hope the operators haven’t become complacent in terms of the growth they’ve experienced, because there’s so much more that needs to be done.  Their attention has been turned to so many other things like music, TV, and video.

So the first thing is that I hope operators don’t just think the business is what it is, and take their eye off the ball, because there’s actually so much more that needs to be done.  I think if operators look at the retail and packaged goods business, some of the basic things they could do is just spend time improving the discovery, shopping, merchandising, and marketing of applications.  Improving that in general is going to put the mobile gaming industry in that upward growth path again.

The underlying technology, from my standpoint, is really not an issue.  It’s not about whether we have enough horsepower in the chipsets, or if the network is fast enough, or any of the other infrastructures built around that, it’s really the basic plumbing that needs to be addressed.

And then off-deck things like whether the operators are going to be open to the indie content aside from all the branded stuff should be addressed, as well as microtransactions of course.

On that note, what needs to happen to make microtransactions with mobile games reach the ringtone and wallpaper level?

General awareness and education from the consumer standpoint.  People just don’t understand that you can play games on your phone.  So if you don’t know that you can play a game on your mobile, are you actually going to buy a game based on a microtransaction model?

But again, if everyone figures out a way to improve those kinds of things, we’ve seen microtransactions work in the traditional game space, so I don’t see why a similar model wouldn’t work in mobile gaming as well.

In terms of the way people pay for games, and the kinds of payments they make, we don’t want to mandate a certain direction over another.  My personal opinion is that depending on the type of game and a number of solutions could work.  The one that really works well is the one where you purchase a game and then it becomes episodic, meaning you have a microtransaction in order to keep continuing on in that game, whether that means buying a new track, level, or characters.  Because what you see right now in traditional gaming is that someone buys a game and then they wait for the add-on pack to come out.

Once consumers become aware that they can play mobile games, how are individual games going to take off?  What will be done to support the viral aspect of gaming?

This gets into a little bit of what we’re actually working on ourselves.  We have something called BREW Gaming Signature Solution, and community is a big part of that.  From our perspective, we need operators to move away from a product focus in that right now they’re focused on their deck and filling that deck up with games.  So when you actually build out a mobile gaming service that has elements of community, loyalty, and enhancing the game play, and even the commerce aspect – meaning within that service you can improve the discovery, shopping, merchandising – when you have that happen it’s not just about someone looking at the deck by themselves, they’re actually engaging in the community.  They might be recommending games, rating games, engaging in chat rooms and messaging.  Other game services like Xbox Live and Sony Home, they’re all moving in that same direction, so I think mobile gaming is no different.

The very concept of a game seems more open to reinterpretation on the mobile platform than for traditional games.  It doesn’t necessarily have to be a character moving through levels.  What do you think encompasses the definition of a mobile game?

If you step back and look at it from the 60,000-foot level, beyond just mobile games, video games in general have always seemed to have a negative stigma attached to them.  Nintendo, and what they’re doing with Wii, maybe they’ll open the door up a little bit more, but it seems like people that don’t understand games don’t seem to want to acknowledge the impact, or how big the business really is.  They might not give it the attention it really deserves, which is interesting because they don’t give games the benefit of the doubt like music TV or movies. 

And when you think about it, games – or as I like to think of it more broadly – play is really an inherent human behavior.  It existed long before there was music TV or movies.  People played games, whether that was cards or dice or marbles, all the way up through board games on to video games. 

So mobile has an opportunity to – if people are innovative – to come up with something very creative.  And because the mobile device is mobile and has unique elements like GPS and your phone number (which is almost like DNA because it’s unique), from a design perspective if someone were to build the right “game,” I don’t think it would need to be defined in the same way that games have been defined in the past. 

If someone designed a game that took advantage of all the different platforms, I think that could be very interesting.  It could be like some of the Amazing Race sort of things mixed with game play that’s on a PC when you’re at home, etc.  So you can really create something very innovative if people are willing to support that.

Scott Goldberg