App Store only place worth selling mobile games, say developers

Mobile game businesses interested in making money should focus only on Apple’s App Store and ignore other mobile platforms, according to independent developers.

Three Toronto-based independent game developers speaking at GameON Finance agreed that the App Store was the only way to make a profit, despite the popularity of Google’s Android operating system. Bytemark Games, Get Set Games, and Little Guy Games focus almost solely on developing for the iOS platform for iPhone, iPod Touch and iPad devices.

Even on Apple’s popular distribution platform, it is easy to get lost in the deluge of 400,000 apps available for download and even harder to turn a profit, with the average life time revenue of an app being about $200, according to Vikas Gupta, president of TransGaming Inc. Success in the App Store is determined mostly by ranking in one of Apple’s top 25 lists browsed by users.

“Being number 25 might mean a thousand downloads a day,” Gupta says. “Being number five might mean you’re doing 50,000 downloads a day. It’s exponential growth as you move up the list, not linear.”

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To drive home the point that Android isn’t worth developing for, Bytemark Games CEO Jon Walsh polled the room of game developers and publishers. Asked if anyone had made a profit by selling in the Android Market, not one hand in the crowd was raised.

“I don’t know anyone that has made a profit on Android,” Walsh confirmed. The App Store is “the only viable market where you can make money at the moment.”

Cracking Apple’s “Top 25” lists can be done, Walsh says. The lists are calculated by taking a weighted average of every app in every country the App Store is available. Using analytics tools to measure how often his games are being downloaded, Walsh will focus marketing efforts around a game that is more likely to reach the threshold to be included on the list.

Getting visibility on the App Store can be achieved if Apple decides to feature you, says Tom Frencel, CEO at Little Guy Games. But since there is no way to control this, it’s not wise to rely on being featured.

Instead, do external marketing and use services such as OpenFeint to push your app. OpenFeint is a social network-style Web site that recommends games to an active user community, allowing users to play games with each other, earn awards, and earn bragging rights by setting high scores.

Still, OpenFeint is only a boost into the App Store’s featured list, Walsh says. That’s where you have to be to rake in big download numbers.

“It’s impossible to drive a million downloads by itself,” he says. “What they can do is drive enough downloads to break that top 50 threshold and get much better visibility.”

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Games are also being driven to bargain basement prices, panel members agreed. Mobile gamers have become groomed to pay little or nothing for their downloads, and charging even $1 can be a barrier to building a user base.

Get Set Games had priced one of its games at $1 for a long time, but saw it get one million downloads after doing a free promotion, says co-founder Rob Segal. That convinced him that “free is the way to go.

“Our games and several others are worth at least $10 for what you’re getting,” he says. “The reality is that people just won’t pay that on the iPhone platform, or the Android platform.”

Many game developers are trying a “freemium” model where the app download is free, but there are opportunities to spend money in the game. Gamers may want to buy virtual items, for example, or virtual currency in exchange for real money. Get Set Games even sells a “megapoints” package in one of its games for $95, and people buy it.

“I don’t know why,” Segal admits. “But they do.”

Another way to earn revenue from free games is to use Apple’s iAd system to include advertising. Gamers will tolerate this if the download was free, the panel agrees, but ads are only going to be clicked (or touched) on by accident.

“Put an ad in your game screen that won’t annoy them too much,” Walsh says. “They’ll click on it just enough and you’ll make money.”

Given the still competition in the App Store, it’s best not to spend too much time or money on any one game, developers say.  Instead, release a polished product with one clear concept and see if it catches on before putting more resources into it.

Use a team no larger than three or four developers, spending two or three months and about $50,000 to develop an iOS app, Walsh recommends.

“Unless you have a really good backing and are able to generate a lot of hype around your game, it just doesn’t make sense to spend a year building it,” Segal agrees.

Apple’s App Store gives developers 70 per cent of the revenue they make from sales and sends cheques out monthly. It doesn’t charge fees for free apps.

Brian Jackson is a Senior Writer at ITBusiness.ca. Follow him on Twitter, read his blog, and check out the IT Business Facebook Page.

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