Cos. develop titles for the Web and handheld devices

While the exhibitor floor at the Electronic Entertainment Expo is going to be controlled by console and PC gaming giants, a third division is starting to make inroads at the conference: companies that focus on games played on the Internet and wireless devices.

Of the 750 products that are scheduled to debut at E3, which began Wednesday and runs to Saturday, roughly 15% have been developed for handheld devices — including Nintendo’s popular Gameboy gaming system, cell phones and personal digital assistants, like Palm Pilots and Pocket PCs — while 4% will be games designed for Web play.

An entire conference session has been set aside for online gaming, including topics like consoles making the jump to cyberspace, business strategies and creating Net games on a budget.

The reasoning behind this is simple: So far the most successful applications on the Internet are communications mediums like email and instant messaging. Online multiplayer gaming is just a step up, and the profit potential is more obvious than it is with other forms of Web entertainment if game sites follow a common sense pay-for-play model.

In the mold of popular multiplayer online games and financial success stories like Sony’s “EverQuest” and Electronic Arts’ “Ultima Online,” Abandon Entertainment and Mythic Entertainment are releasing “Dark Age of Camelot.” The game, which will support thousands of users in its graphical interface at any given time, will cost $9.99 a month.

The game took 18 months to develop and takes place in three worlds surrounding Camelot after the fall of King Arthur. It is being marketed through a number of mediums, including DC Comics and Miramax, which has agreed to place the product in four upcoming films. A television show is also in development.

“There’s real revenue in it,” says Marcus Ticotin, prexy and CEO of Abandon. “We’ll remain focused on the online game at first and then perhaps move offline.”

With its yet-to-be released Xbox platform, Microsoft has staked the early claim among the major players when it comes to an online gaming strategy.

“The Xbox has an Internet port and hard drive, which allows broadband connectivity,” says Microsoft spokesman Lincoln Davis, who declines to give specifics on what kind of games the company is developing to play at broadband speeds beyond saying that there will be announcements to that effect at E3.

In the interim, the offerings on Microsoft’s Zone.com gaming site may give an inkling of what the software giant will offer, including multiplayer games like blackjack, bridge, checkers and chess. Microsoft charges about $10 a month for its premium level of titles.

At E3, the company is set to bow trivia game “Outsmart,” which pits celebrities against Internet users who think they know more about a particular star’s career than the famous person themselves. The first celebrity is Jessica Alba, star of “Dark Angel.” Four more celebrities should be announced by June, Davis says.

According to analysis firm Jupiter/Media Metrix, the most popular gaming sites on the Web include Zone.com, Vivendi Universal’s Flipside.com, iWon.com, AtomShockwave.com and Jackpot.com.

But just because a gaming site is popular doesn’t mean that it can turn a profit based on advertising revenues alone. Sites like iWon and BigPrizes.com have faced financial hardships or layoffs despite a loyal base of users. What it takes is a link to a forgiving corporate parent with deep pockets — like Microsoft and Zone, Flipside and Vivendi Universal, and software company Macromedia and AtomShockwave — in combination with a plan to charge for games.

AtomShockwave now offers a series of games through a subscription service that offers online versions of arcade games like “Spy Hunter,” “Joust” and “Centipede” through its Shockmachine software. Two collections, priced at $19.95 each or $29.95 for both, are available for download at www.shockwave.com.

RealNetworks has unveiled a gaming division on portal site Real.com. While many of the games on the site are free, several are tied in with the company’s pre-existing subscription service GoldPass. GoldPass costs $10 a month, and Real Network CEO Rob Glaser attributed the company’s revenue boost last quarter to the success of the subscription model.

Overseas, this type of pay-for-play model is more popular on wireless devices than on computers with Internet access. Nokia and Motorola, both of which will have representatives at E3, already have made overtures in this realm, with the manufacturers including basic games like memory, snake and spades embedded into their products.

Software development company Jamdat is working on games for the United States when our wireless capabilities are fully up to speed. Right now, Web-enabled cell phones can play games like “Gladiator,” in which you create a fighter and maneuver it on the screen of the phone.

“We’re really more interested in keeping the quality high instead of producing a lot of little throw-away productions,” says Austin Murray, veep of business development at Jamdat. “We definitely are going to keep putting our resources into stuff that works today, which is the wireless Web.”

Murray will be attending E3, although Jamdat will not have a booth in order to conserve their precious funding, which was given to them by the likes of Intel and Qualcomm. He believes that this year will be the one when the wider gaming community starts to take note of what is going on beyond consoles and PCs.

“Last year the only people who were at E3 were Nokia and that was it,” he says. “This year we’re getting all sorts of calls.”

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