In the second quarter of 2011, the smartphone market in general grew by 73% while the Android operating system in particular experienced 379% year-over-year growth. This, more than anything else, has put a huge dent in the traditional handheld gaming market. The most recent casualty in this changing state is – believe it or not – Nintendo, who is trying to recover from a very poor launch of their 3DS handheld system.
Nintendo has been synonymous with handheld gaming ever since they released the original black and white GameBoy in 1989. For years, no other portable gaming system has been able to compete. Sony fought a good fight with its Playstation Portable, but it never gained the same kind of widespread adoption as the Nintendo systems.
Now some analysts have predicted that Sony may just have a chance this year, with the 3DS performing so poorly and the Playstation Vita impressing both critics and game designers. At the same time, though, some industry experts are saying that the widespread adoption of smartphones is making dedicated handheld systems completely irrelevant.
Will mobiles conquer all?
Adapt or Fall Behind
As the portable market continues to change, a lot of companies are really feeling the effects. Some of them, though, have learned to adapt.
Smith & Tinker was founded in 2007 with the stated goal of bringing toys and gaming closer together. They started developing their own handheld device and launched it with their game, Nanover, in 2009. The game revolved around collecting certain toys that had information that could be used on their special gaming device (that sold for $50) or through a computer.
Smith & Tinker had some heavyweights in the gaming industry behind them, and they had raised over $29 million in funding to get everything started. They advertised heavily on TV and online, but they just couldn’t get the traction they needed, and soon shut down their Nanover servers. While the 17% decline in the youth electronics category that year certainly had an impact on their sales, it was seen as just more evidence that dedicated devices were becoming more irrelevant. Even the kids just seemed to want an iPod.
The company wasn’t quite ready to call it quits, though. Smith & Tinker restructured and are now currently producing new games – for iOS. They saw how fast the mobile gaming market was growing and have just released their first game for iPhones/iPads, called Marvel KAPOW! which seems to be doing well.
What about Sony?
So with the 3DS doing so poorly that the CEO of Nintendo actually took a 50% pay cut, what chance does the upcoming Playstation Vita really have? Sony has managed to pack a lot of technology into their new device for a surprisingly reasonable price (or at least it was considered reasonable until Nintendo dropped the price of its 3DS), and at Gamescom, in Germany, the system received an award for Best New Hardware. Sony even announced the addition of Foursquare and Skype to their existing social applications. But is it enough?
The Playstation Vita is, by most accounts, a very impressive little machine. Even designers who have bemoaned the difficulty of developing games on Sony’s platforms are starting to say that this device is pretty easy to use. But even with all this positive talk, many people are still questioning its ability to succeed in this market because, “well, I’ve already got my phone.”
Can Traditional Handhelds Compete?
The gaming market is completely different than it was just a couple years ago. The serious players turn to their dedicated gaming computers or consoles and the casual, mobile players turn to their phones. The market has definitely changed when writers in the gaming industry don’t question whether the Playstation Vita will be able to compete with the 3DS, but if it will be able to compete with the iPad 3. Some of them even say that what the Vita will need to get new users is not the games like Uncharted or Little Big Planet (both of which have millions of dollars invested in their development), but games like Angry Birds and Fruit Ninja.
The 3DS was something of a misstep. It jumped on board with a 3D gimmick that is incompatible with being mobile (you have to hold your head and the device completely still in order to see the 3D effect), and the Vita is coming into an industry where casual players think that games should be $2.99 or ad-supported rather than the standard $49.99, and it is going to offer features that most users already use on their phones.
So what benefits to traditional mobile gaming platforms have over the new phones and tablets? Well, virtual buttons on a tablet will never have the same feel as real joysticks and buttons. Also, the lifecycle of a handheld system is, historically, about five or six years while in the world of phones, “next gen” comes out every year. So before the next Playstation handheld comes out, iPhone owners will have burned through the iPhone 5, 6, 7, etc.
In the end, these systems will survive on the strength of their games and not the extra features. It may take some Angry Birds to get new people to try the system, but it will be the Uncharteds and Little Big Planets that keep them coming back.