If you're a child of the 1980s, then there's a good chance that Nintendo's inaugural video game console topped your Christmas or Hannukah wishlist when the first-generation system debuted. Back then, saving the pixelated princess was the easy part--the real challenge was just getting the game to load, involving shaking, blowing on and sometimes even smacking the temperamental cartridge around.
Hard to believe that today, game play is as easy as simply turning on your phone.
Mobile gaming is on the rise, and revolutionizing the gaming industry--according to a recent study by Nielsen, the average iPhone user spends about 15 hours a month playing games on their smartphones.
Android users clocked in slightly above the overall average smartphone user, at 9.3 hours compared with 7.8 hours over a 30-day period. 64% of downloaders have loaded a new game onto their phone within the last 30 days, making games the most popular, and lucrative, category of smartphone applications.
Need more proof? Social and mobile gaming giant Zynga just filed a $1 billion IPO.
So what does all this mean for console gaming systems? If you ask Peter Vesterbacka, creator of the popular Angry Birds game for mobile phones, their days are numbered.
Quoted at SXSW declaring "consoles are dying," Vesterbacka sees the future of gaming in mobile and social mediums, while traditional companies charging $40 or $50 for a game are heading toward extinction.
But Nintendo president Satoru Iwata makes a compelling counterargument: “Consider this: the number of games available on the big app sites is in the tens of thousands. Game development is drowning. Yes, these games are far less expensive to create, but what revenue will they generate?”
Does the rise of the cheap mobile game signal weaker sales for video game companies that produce more expensive "premium" games for consoles? You be the judge--here's a list of companies with exposure to the trend.
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List sorted alphabetically.
1. Activision Blizzard, Inc. (ATVI): Market cap of 13.81B. It is engaged in online, personal computer (PC), console, handheld, and mobile game publisher. Activision offers games that operate on the Sony Computer Entertainment Inc. (Sony) PlayStation 3 (PS3), Nintendo Co. Ltd. (Nintendo) Wii (Wii), and Microsoft Corporation (Microsoft) Xbox 360 (Xbox 360) console systems; Nintendo Dual Screen (NDS) and Nintendo DSi (DSi) handheld devices; the PC; the Apple iPhone (iPhone), the Apple iPad (iPad) and other mobile devices. Its mobile games include "Tony Hawk: Proving Ground" and "Guitar Hero World Tour Mobile".
2. Electronic Arts Inc. (ERTS): Market cap of 8.3B. It develops, markets, publishes and distributes game software and content that can be played by consumers on a variety of video game machines and electronic devices (platforms), including video game consoles; personal computers; mobile phones, such as the Apple iPhone, Google Android compatible phones, and feature phones; tablets and electronic readers, such as the Apple iPad and the Amazon Kindle; and the Internet, including on social networking sites, such as Facebook; and Handheld game players, such as the Sony PlayStation Portable (PSP) and Nintendo DS and 3DS. Its mobile games include JAMDAT Bowling, SimCity Societies, Skate, Tiger Woods PGA TOUR, Dead Space, Transformers Dark of the Moon, Draw Jump, Medal of Honor, MADDEN NFL, and Bejeweled.
3. Glu Mobile, Inc. (GLUU): Market cap of 300.06M. It is engaged in designing, marketing and selling games for mobile phones. It has developed and published a portfolio of casual and traditional games designed to appeal to a cross section of the subscribers served by its wireless carriers and other distributors, as well as to users of smartphones who purchase its games through direct-to-consumer digital storefronts. Its games include Call of Duty, Deer Hunter, Diner Dash, Guitar Hero 5, Family Feud, Family Guy, The Price Is Right, Transformers, Wedding Dash, Who Wants to Be a Millionaire?, World Series of Poker, Zuma, Beat It!, Bonsai Blast, Brain Genius, Glyder, Stranded and Super K.O. Boxing.
4. Konami Corp. (KNM): Market cap of 3.48B. It develops, publishes, markets and distributes video game software products globally for stationary consoles, for portable consoles, as well as for use on personal computers and mobile devices. Its mobile games (for the iPhone) include Frogger, Silent Hill: The Escape, Dance Dance Revolution S, and Metal Gear Solid Touch.
5. Rovi Corporation (ROVI): Market cap of 6.62B. It provides advertising, marketing, and other solutions for electronic content developers, including mobile game developers. Its offerings include interactive program guides (IPGs), IPG advertising, embedded licensing technologies (such as recommendations and search capability), media recognition technologies and licensing of its extensive database of descriptive information about television, movie, music, books, and game content, and content protection technologies and services.
6. Take-Two Interactive Software Inc. (TTWO): Market cap of 1.33B. It is a global publisher, developer and distributor of interactive entertainment software, hardware and accessories. Its publishing business consists of Rockstar Games, 2K Games, 2K Sports and 2K Play publishing labels. The Company develops, markets and publishes software titles for gaming and entertainment hardware platforms and has also begun to develop and publish titles for the iPhone and iPod touch. Its mobile apps include Civilization Revolution and Duke Nukem Forever Soundboard.