Game Developers Making a Play for iPhone

Following Apple's (Nasdaq: AAPL) move to open the device to outside programmers, some of the top developers and publishers are already making games for it. The iPhone's high-tech hardware and Apple's plans to distribute software for it over iTunes give it a lot of potential as a game machine, they say.

In theory, developers could create games for the device that are more sophisticated than -- while just as mobile as -- those made for Sony's (NYSE: SNE) PlayStation Portable or Nintendo's DS, said John Carmack, president and technology director of Dallas-based idSoftware, which created the "Doom" and "Quake" franchises.

Excited About Possibilities

"It really is an extremely nice platform to work with," Carmack said.

Apple unveiled its new tools for developing software for the iPhone at a media event in Cupertino, Calif., last week, where Apple also unveiled tools and software that will allow the iPhone to connect directly with Microsoft (Nasdaq: MSFT) Exchange mail servers -- and thereby increase its appeal to corporate America. Not only did Apple show off a demonstration game it created for the iPhone, but so too did mainstream developers Electronic Arts (Nasdaq: ERTS) and Sega.

EA showed a version of "Spore," its eagerly anticipated game developed by Will Wright, creator of "The Sims." Sega demonstrated a version of "Super Monkey Ball," a popular arcade and console game.

Sega hasn't committed to develop any particular game for the iPhone, said Ethan Einhorn, a producer at the company. However, Sega plans to develop a series of games for the device, and given how pleased the company was with how the "Super Monkey Ball" demo turned out, it's a good bet that title will be among them, Einhorn said.

"We're excited about the possibilities that the (iPhone) brings to the market," he said.

EA and Sega aren't the only game developers enticed by the iPhone. ID is considering porting some of its titles to the platform, as is Glu Mobile, one of the leading mobile game developers. Glu rival Gameloft has already committed to releasing 15 games for the iPhone by the end of the year.

Distribution Through iTunes

Game developers with interest in mobile games are "definitely going to want to spearhead development on what is the most exciting device in the mobile phone market," said Seamus McAteer, cofounder and senior analyst at M:Metrics, a research firm focused on the mobile phone industry.

The iPhone, of course, is not the first mobile phone to play games. Even the cheapest handsets these days can play games, and a whole industry has cropped up to produce, customize and distribute games for mobile phones. M:Metrics estimates that Americans will spend more than US$600 million on games for their mobile phones this year.

However, the industry has faced a number of challenges. Only about 3 percent of phone owners in the United States download a game for their phone each month, according to M:Metrics. Meanwhile, mobile game developers typically have to create dozens or hundreds of different versions of each game to account for the vast variety of cell phones on the market.

Due to download times and limited storage capacity on the handsets, wireless carriers have typically limited the size and sophistication of games. Creating a hit game often has had more to do with offering a recognizable title or gaining premium placement on a phone's list of games than developing a fun-to-play game.

Apple plans to distribute games and other software over iTunes and through an over-the-air store accessible via an icon on the iPhone's home screen. The ease of navigating and searching iTunes should help boost sales and downloads of titles beyond the typical top sellers. Because Apple hasn't set a limit on the size of applications, developers should be free to develop more sophisticated titles.

"Compared to Apple, the other things that go on in mobile development, that's all amateur hour," Carmack said.

'Room for Significant Investment'

Developers are also excited about the iPhone hardware. The device's built-in accelerometer will allow them to develop games that users can control through natural movements like tilting or shaking rather than pushing buttons. If buttons are desired, developers can use the iPhone's customizable touch screen to create ones just for their game.

"It's got this nice, beautiful blank canvas," said Travis Boatman, vice president of worldwide studios for EA's mobile games division. "That's where the power of this device really lies."

To be sure, the iPhone is still unproven as a game platform. Because no games ship with the device, it's hard to know how many owners will want to play them. Even mobile phones designed with gaming in mind, such as Nokia's (NYSE: NOK) N-Gage and the Gizomondo, haven't done particularly well in the market.

Developers could spend lots of money creating some really exciting titles for the iPhone, Carmack said. However, at least in the near term, it probably won't be cost-effective for them to do so.

Apple expects to have sold some 13 million iPhones by the end of the year. Many analysts and developers expect iPhone users to be bigger game players than other cell phone users. So many see a healthy market in its infancy.

"We clearly see that there's room for significant investment," said Michel Guillemot, CEO of Gameloft. "This machine deserves it. Consumers will be delighted by the experience."