Are app stores bad for gaming?

by Ben Salter Featured 4 Comments 30 Votes 5904 Views 09/03/2011 Back to Articles

Are app stores bad for gaming?

At the Game Developer’s Conference last week, Nintendo president Satoru Iwata criticised mobile app stores and the impact they are having on the gaming industry. Iwata argued that app stores have created two types of developer: those like Nintendo, focusing on quality, and mobile app stores which only care about quantity. His primary concern was the sheer number of low quality apps released. While they are cheap to make, the revenue doesn’t compare to that of a traditional game and the market is saturated with tens of thousands of small scale games.

Satoru Iwata is one of the smartest men in gaming. I have as much respect for him as Miyamoto, and while he’s at the helm, Nintendo will always have a positive future. However, his comments are somewhat one-sided. I understand where he is coming from, and even agree to an extent, but he needs to consider the other side of the argument.

He has valid reason to fear. The iPhone is a serious contender against the 3DS and NPG, as is Sony’s Xperia Play and all Android phones with PlayStation Suite. Cheap apps are great for short bursts of portable gaming, and for generally under $10 and sometimes all the way down to $0, Nintendo and full retail developers cannot compete. On consoles, indie titles and cheaper downloadable games are great to compliment the full scale releases, but will never completely triumph over them. On portables, they are perfect for what handhelds are designed for. Furthermore, if your phone can play awesome, cheap, games, why would you need a portable gaming console?

What that’s failed to consider, however, is that gamers want to play full games on the go and treat them differently to apps. Iwata also seemed to forget that Nintendo has DSiWare and the 3DS’s eShop. Small downloadable games, or apps if you will, on the store will compete with those on the iPhone, not full retail games that cost upwards of $60. I love Angry Birds on my iPhone, but after the first week, I rarely played it and now only crack it out when I’ve got 10 minutes to kill. I’ll still always have a portable console for what isn’t offered to me on an app store or home console. With the 3DS it’s the likes Pokemon and Mario, along with Nintendo’s other key franchises.

Where the fears might become more warranted is third party multiplatform titles. Fifa 11 on iPhone is actually pretty good; better yet it costs $5.99. The DS version costs over 10 times that amount, and the 3DS certainly won’t be any cheaper. Fifa is best played on consoles, and nobody in their right mind is going to buy their primary version for a handheld unless they have no other option. It’s simply a supplementary title when you can’t access your PS3 or 360. However, that makes it better suited to the much cheaper iPhone version. In this sense Iwata has a point. It won’t generate nearly as much revenue, but that’s EA’s initiative. They released both the iPhone and DS version being fully aware of the price discrepancy. However, as its core audience will buy the game on consoles, the DS vs. iPhone version is a non-issue for EA, as they will bring in spare change by comparison.

Iwata seems to suggest that the low price point of smart phone games and apps will ruin the financial state of the industry. What he appears to forget is that developers set those prices after careful calculations. Some indies are quite happy to essentially give their game away just to get it out there, but you can bet your house on the big guns, like EA, knowing exactly what they are doing and setting a price to profit. The price difference between an app and retail game is ridiculous. They prove that we’ve been taken for a ride for years, but it’s important to remember retail games cost more to develop.

Nintendo has rights to be wary about the impact of apps stores on the gaming market, but they aren’t detrimental to the industry, at least not yet. As Iwata himself says, developers like Nintendo care a lot more about what they produce than small app companies who focus on quantity. Gamers respect that and are willing to pay more. We’re not stupid. We know Fruit Ninja and Pokemon Black & White aren’t even in the same league in terms of development costs and value for money, and are willing to pay what seems to be an extreme difference in price. There’s plenty of space in the industry for both quick 10 minute time-wasters on your phone, and fully-blown 40 hour quests on a handheld. However, if it does start to become an issue in the future, and I suspect it will begin with multiplatform titles like Fifa, it will only be a good thing for the consumer. Handheld games are currently inflated above anything else. Technically, their R.R.P. is $69.95 or $79.95 in Australia, which is ridiculous. If $1.19 apps start to steal too many sales, they’ll force the R.R.P. of full release games down to a more reasonable price, and gamers will happily pay it.

Mr. Iwata, there’s plenty of room in the industry for cheap apps and full retail handheld games. Just make sure you deliver the quality you promised.

By Ben Salter

What do app stores and cheap games mean for the industry?

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Are app stores bad for gaming? Comments

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Iwata argued that app stores have created two types of developer: those like Nintendo, focusing on quality, and mobile app stores which only care about quantity.

Soo.... There's one type of developer? Those that only care about quantity, like Nintendo.

Iwata has nothing to fear. I think people, or gamers at least, understand the difference in mobile phone apps and handheld consoles. ;)
Nintendo knows quite a bit about market strategy. They rarely change their agenda mid-generation (see Microsoft, SEGA), but I think that Iwata is fearful, not just weary, of the potential of something like the App Store. I think it's great, because it's provided the opportunity for indue developers, developers not otherwise able to get their games into the hands of gamers. Also, there is nothing wrong with the industry growing in scope and become rather broad, as it has become. Cheap, small games have a purpose: to offer quick, mindless engagement and enjoyment. Big games, like the ones Nintendo make, offer a deeper, longer-lasting experience with a larger scope. They are quite different. Nintendo often gets it wrong (see online gaming), although I don't think they aim to appeal to gamers that want to play online. But they have said in the past that online gaming doesn't appeal to gamer (lulz).

I think Iwata is very Japan-focused, and has failed to see the bigger picture here. Something like the App Store is great for gaming, and it actually contributes to its growth, maturing and quality, because more people are entering into development because they now have a platform for it.

BBking said: Soo.... There's one type of developer? Those that only care about quantity, like Nintendo.


Wow for real? When's the last time Nintendo released a string of games in a really short period?
The way I see it, the App store is mostly a range of repetitive, mindless games. That is, until a full-featured game is released at a lower price on the App Store than, say, DSiWare. For example, Zenonia. It's one of the deepest RPG's on the App Store, and it's only $5. Yet on the DS? It's about $8, for no reason whatsoever. Then you have GTA, which is like $35 for the DS, $40 for the PSP, and.... $10 for the iPod? This range of prices for different handhelds is where I see a problem. [Facepalm]

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