Let the games begin
For cable operators, the game is afoot. With a growing base of both casual and hardcore users hooked on games, MSOs are looking for ways to offer them a better way to play. And as it happens, there is a range of revenue models and delivery methods available to help them score with customers and find new revenue in the process.
One reason cable operators are drawn to gaming is that it extends well beyond the stereotypical 15-year-old boy with his Sony Playstation2 console. There is a significant community of casual gamers, who are interested in occasionally killing time with computer card games and arcade-type titles.
"We thought it was a very different audience and they had very different needs, and the best way for us to serve those audiences was to separate the play and editorial experience," she says.
On the casual games side, Comcast has collected titles from providers, including more than 200 Web-based games that don't require software download, games offered for a per-title fee, and subscription gaming from the likes of RealNetworks Inc.'s RealArcade, Exent Technologies Inc. and other gaming service partners. It's all aimed at the casual gamers—a majority of whom are women—who are turning to games for short-duration entertainment.
"We're reaching an audience that wants a very quick and very easy play experience," MacLean says. "Ideally a great casual game is one where you go in and don't need any instructions, and you can play it immediately. And I think that is one of the strengths of our offering in the casual area."
The other half of Comcast's gaming strategy is Game Invasion, the portal devoted to hard-core players. Game Invasion does offer some gaming-on-demand products, but the primary focus there is editorial content ranging from reviews and features drawn from online gaming outlets G4 (a Comcast venture that also operates a 24-hour gaming television channel) and IGN, as well as codes and a database of game titles on the market along with ratings.
"We like to think of it as a great editorial clearing house for our customers who are interested in more of a focused, hard-core gaming experience," MacLean says.
It also offers a home delivery console games service from GameFly, modeled on the same distribution strategy as the Netflix movie service. Comcast does have plans to add more hard-core game titles, but the focus still is on serving the gaming enthusiast in ways other than just a title distribution outlet, MacLean says.
"I think we're adding more game titles just as a function of the industry, because more than half of the game industry's revenues come in Q4, and you see a lot of titles come out at this time to hit the holiday buying season," she adds.Pay to play options
When it comes to the revenue model, Comcast similarly offers more than one way to pay and play. The more basic Web titles are available to play for free, while downloadable titles offer more functions and are usually available for free for the first hour of play. From there, users can buy the downloadable games at prices ranging from $4.95 to $19.95. A third option allows users to sign up for the $6.95 RealArcade's Game Pass, allowing users to download one game free a month, with discounts for additional titles downloaded.
"I think they've all performed very well for us," MacLean says of the payment options. "In a lot of ways, if you look at the (free) Web games, it's a great introductory experience. So if you take a game like Zuma, for example, I can play it for free. I don't get all of the features and functionality, and I can only play it to a certain point in the game, but it's a great way to introduce me to the game."
Through distribution deals forged with Comcast, Cablevision Systems Corp., Time Warner Cable and Insight Communications, RealNetworks also is finding good traction in particular for the "try before you buy" model.
"This allows the customer to actually try the game before they go out and buy it, because you typically don't get a lot of the big, Electronic Arts-branded games like Tony Hawk that have name recognition," says Julie Pitt, RealArcade's general manager. "That being said, I actually think that a variety of different financial models make a tremendous amount of sense in the space."
RealArcade does offer an ad-supported model as well. It has more than 100 Web-based games, and since the infamous Internet crash of 2001 it has seen a "bit of a rebound in that market. Customers are able to enjoy a tremendous amount of fun content and then it is essentially monetized or sponsored by advertisers."Getting the games
Revenue strategy aside, the greater challenge for cable operators may be developing the connections to gaming content. That's where outfits like RealNetworks and Exent can come into play, offering not just gaming content services but also the delivery and transaction elements to manage the service.
In January 2004 Real acquired casual game outlet Game House, which now serves as the primary source for Real's in-house content. But Real also works with more than 100 game developers worldwide to supply the 300 games now in its RealArcade portfolio, with four to five new games released every week. That can be valuable for cable operators who don't want to become experts in gaming content.
"There is a lot of not-so-great content out there, and so a cable operator, or I think anybody out there, realizes that they are not necessarily the subject matter expert in this particular space, so it is much better to partner with somebody like RealArcade to essentially manage the service for them," Pitt says.
Exent, meanwhile, provides a technology platform to launch and manage gaming services, as well as a lineup of 3,000 games supplied by top game development houses including Ubisoft and Atari. Its customers include Comcast and RCN, as well as broadband providers Verizon and Yahoo! Exent also is involved in Turner Broadcasting's recent launch of its gaming platform.
Exent's platform provides automatic updates for the user, including software upgrades and new drivers. It also streams the games from its own hosted servers, thereby cutting the burden of having the user find space on their own computer drives and allowing the user to start playing more quickly.
"We don't want them to go through a rigorous installation period—we don't want them to worry about disk space," says Yoav Tzruya, Exent's vice president of products and market strategy. "We don't want them to worry about patches and such, which is why we provide everything for them."
Nonetheless, cable operators may still be missing out on some of the fun, according to James Regan, the director of new business development at Ubisoft.
Ubisoft has deals through Exent with Comcast and RCN Corp., and it also plans to debut game titles with Canada's Shaw Communications soon. While Regan says Ubisoft is happy with these associations, "I do think they are leaving some stuff on the table."
That's because cable operators are tending to tap Ubisoft's older game titles for their platforms, and that may not have as wide of an appeal to gamers. In contrast, Ubisoft is working with online gaming portals, including IGN, to provide games just days after their commercial launch, and that is a format it prefers, Regan says.
"It opens up and allows more customers to come and purchase our products, and we've had success there," he says.PacketCable plays in
In technology, cable operators may soon have more tools to create better gaming services through PacketCable Multimedia (PCMM). The new specification and architecture adds quality of service and application-specific signal prioritization, and that could help strengthen MSOs' gaming services, says Glenn Russell, director of multimedia applications in the advanced network systems department at CableLabs.
CableLabs also is trying to make PCMM friendlier for games developers. Draft extensions now working their way through the approval process would expand the number of protocols used to communicate with cable operators' policy servers beyond Common Open Policy Service Protocol (COPS).
Those additions could be completed by the end of this year or the beginning of next year.
"Essentially, if you've got a games server out on the network, the current spec requires that application manager—that games server—to speak the COPS protocol to request resources," Russell explains. "We're broadening that to make it more of a Web Services model, and Web Services is something that is much more broadly adopted than COPS. So the idea is to make (PacketCable) Multimedia and this policy framework available to a wider range of applications than it currently is."
For its part, Comcast is looking to the PacketCable Multimedia architecture as a potential tool to improve that connection for gamers, says Mitch Bowling, senior vice president of operations for Comcast Online and Comcast Voice.
"As we continue to expand in the gaming community and continue to evolve through that, and as the PacketCable Multimedia platform becomes far more ubiquitous, we intend to take advantage of that," he says.
Meanwhile, the MSO is looking at a number of speed tier options to add in addition to its standard 6 Mbps down/384 kbps up and 8 Mbps/768 kbps premium tier. Speed is a strong selling point for gamers, not just to cut game download times, but also to give users faster response times for multiplayer games.
In the multiplayer community, the competitors to beat are labeled "low-ping bastards"—users with a high-speed connection and faster response times.
"I think it is huge," MacLean says of the low-latency advantage. As a gamer herself, "when I talk to my friends who are gamers and are not as familiar with the Comcast offering, even when you talk about our 6 Meg product, they say 'Wow, that's really good.' But when you talk about our 8/768 or you explain PacketCable Multimedia, their eyes light up."
If such improvements do make for better gaming services, cable operators may also be lighting up with added revenue they generate. At this point, many of the necessary elements now appear to be in play.