Friday, August 10, 2012

The beginning of the end: id, Bigpoint, THQ close mobile divisions

Renowned developing studio id Software (´Doom´, ´Quake´) is shuttering its mobile development, as are the publishers Bigpoint and THQ. The hype surrounding mobile games on smartphones and tablets seems to be coming to an end.

With only a few sentences, John Carmack revealed rather important news in his keynote speech at Quakecon a few days ago, namely that id Software was shuttering its mobile development division. Carmack said:

We did make the decision to close up our mobile development, which saddened me a lot, in that I love doing the mobile work — taking that time, spending a month, a year or something working on a mobile project, but we had some developers on there that we wanted to bring onto the Doom 4 project.

And it was looked at as something that; yes, this is fun, this is fun for the company and it's entertaining, it makes money, but it's not a grand slam sort of thing on there. The Bethesda family really is about swinging for the fences. I hope we do get back to mobile in various ways in the future, but the big real aim is blockbuster, AAA titles, and for id that means Doom 4, it means that we get the whole company behind that after we get Doom 3 the BFG Edition out the door, essentially everybody will be focussed on Doom 4 as a project.

Carmack was the first big name developer to pledge support to mobile platforms like iOS and perhaps the most vocal supporter of mobile development, first assigning a team of people to iOS development in 2007 and praising Apple for both iOS and their App Store.

Back in 2007, Carmack had noted:

We are operating on the assumption that mobile gaming has a potential for huge growth. (...) It's at a tipping point. Everybody has a phone, and almost every phone is powerful enough to do good games on it. (...)

The whole reason we are in the mobile arena now is I was just really appalled at how bad [mobile games] were. (...) We're already making profit on 2 million units of games sold, but we are kind of holding out this hope there might be a breakout moment when the industry gets five to 10 times larger.

Evidentally, this expected growth did not materialise. And other big companies are abandoning mobile development, too. Bigpoint is at the other end of the core-casual spectrum, but they are following id Software's example. Bigpoint CEO Heiko Hubertz told

I'm a big believer in mobile, it's going to change many things in the games industry. But I also think it's not the right time at the moment to be in this market because to generate revenues in this market is very tough. (...)

For that reason we decided also to close our internal mobile games development. We will not continue to create mobile games internally. (...) We had around ten games in development, some of them are finished and will launch in the next few weeks but most of them will be completely closed and shut down.

Finally, financially troubled publisher THQ can no longer afford to be developing mobile games. In their most recent earnings conference call, the company's president Jason Rubin says (at around 16 minutes into the call):

We have (...) stopped develoment in certain areas that are not productive for our new strategy. Consistent with this vision, THQ has made a few changes to previously announced projects.

First, we made the determination not to pursue any future casual Facebook games. Second, we will not be publishing casual mobile games, including those with Innovative Leisure. (...)

By cancelling these explorations outside of our core business, we feel we can improve focus on our core game portfolio, which remains unchanged.

So publishers in financial trouble jettison mobile development because it is not profitable enough. But with id and Bigpoint, affluent developers are getting out of mobile development, too, both casual and core.

In my last post, I already rounded up some facts about developing for Android and iOS, which revealed how unprofitable it is for the majority of developers. Let me repeat the key facts.

It takes pot luck to have your game found in a sea of hundreds of thousand apps with extremely poor filter options on all mobile platforms. Most apps are never downloaded and studies claim that 29% of downloaded apps are only used once. 72% of apps are either free or just $0.99 (Apple's 30% take in the case of iOS not factored in).

Being successful in either the App Store or Google Play has been likened to a lottery, with more than half of developers not even breaking even (this figure is suspected to be perhaps as high as 90 percent). Even developers themselves are out to destroy some common myths about app success. For example, havin an app in the top 100 charts might mean you are making no more than $4 a day.

Some developers have already turned their back on platforms like Android because it simply is not profitable anymore. And with Trip Hawkins, the first industry veteran has left a previously hyped-up mobile games developer he founded himself.

So has the hype surrounding game development for smartphones and tablets given way to the realisation that these platforms really are not all too profitable? Undoubtedly, if you ask me.