Gaming gets serious as iPhone drives industry investment, change

All change in the games industry where the iPhone gold rush is generating serious deals and forcing major strategic change.

There’s big prizes at stake. Most smartphone users (62 percent) download one to five applications per month, while iPhone users are far more active, with 82 percent downloading apps, according to Goldman Sachs. iPhone users, more than those on any other platform, are keen on games, the analysts confirmed.

There’s cash in the iPhone attic: Overall downloads from all app stores will reach 6.67 billion applications by 2014, up from two billion this year, Vikrant Gandhi, analyst at market research firm Frost & Sullivan, told internetnews.com.

Games have become the dominant category on the App Store, with analysts predicting Apple will grab 10 per cent of the handheld games market by the end of the year.

This developing competition for a slice of Apple’s growing market is in the spotlight again today, with comments from Namco, where recently hired ex-Apple veteran, Jonathan Kromrey has taken charge of a new dedicated Apple device development team.

He explains: “I bought a group of people with me from Apple". And Namco seems prepared to make major investment in Apple’s platforms, “We are evaluating partnerships with other developers,” he said.

Confirming just how seriously developers see iPhone development, he says, “My charge is to make games that are the best for the iPod touch and iPhone. There is a gold rush to do Apps for the App store and Namco is at the forefront of that movement."

On future games developments, he admits Namco’s working on a back catalogue of Japanese games along with some new ones, and the company will bring Tekken to iPhone if it can figure out effective game-play.

“No matter the game, what’s most important is that the player feels this real sense of immersion, of tangibility, so they’re no longer playing a game on the device, they’re in the poker room or at the fighting tournament.”

It’s not just Namco, Sega recently began canvassing iPhone gamers to find out which old Sega classics should be given the iPhone treatment.

And it’s not just games developers. There’s serious VC investments being slammed down as Wall Street considers all the estimates and follows the money.

– Backflip Studios, the indie developer behind the popular Paper Toss game for the iPhone, has raised $145,000 in funding, it announced this month.

– Z2Live has just raised a total $4 million in finance to develop the first multiplayer game platform for the iPhone and other platforms.

With the focus on Apple, we’re unsurprised at recent rumours from Sony, which claim that company plans to match App Store prices on games sold through its revitalised PlayStation Network (PSN), where games will cost between 1-5 Euros, rumour claims.

Like Microsoft, RIM and others, Sony has begun actively sourcing iPhone developers to bring existing titles to PSN.

What’s next? We think Apple may eventually extend its growing presence in mobile gaming to attempt a grab at the console market, with the possible introduction of a Pro games store at the App Store, selling titles in higher resolution for playback on larger-screened Apple devices.