The Future of Gaming is Not Mobile

Ben Parr wrote a terrific piece on the future of gaming over at Mashable. I agree with most of the prognostications but I think Ben buried what will turn out to shift the space in the most substantial way. He wrote that he expects to see a "wave of social gaming on the console." While there has been social gaming on consoles for quite a while now, I think this is a major understatement.

Games such as Pet Society or Who Has The Biggest Brain will likely make their way onto the console, either in disc or downloadable form. It’s lucrative and people have proven their willingness to pay for the HD, console-based experience.

Other social gaming platforms will either be acquired or strike lucrative deals to bring their games to the console as well.

Delivery of advertisements into video games is nothing new and, as Jeremy Pepper pointed out to me last week at the Audience Conference, ads even appeared in relics like Pole Position. Advertisers have embraced video games as a very relevant and cost-effective platform but we haven't even seen the beginning. Contextual advertising has been appearing everywhere from web search to email. I believe we will see a ton of targeted advertising in video games for consoles over the next 5 years. I think the consoles will be able to tell advertisers which games are being played on the console and then deliver relevant and unobtrusive advertisements to players. Consoles will be able to mine data about web history, game-playing habits, chats within games, movies played on the device, music and pictures uploaded, etc. Then ads can be streamed into games instead of burned into discs or software.

Beyond gaming on consoles like the PS3, XBOX 360 and the Wii, streaming movies is also a new avenue for marketing and advertising. Instead of getting outdated trailers for movies from 8 years ago when you decide to rent Wonder Boys, you would be able to stream trailers for movies like Where the Wild Things Are or Paranormal Activity (maybe here Netflix could help more).

Especially after today's AdMob acquisition by Google for $750 million in stock, Google has emerged as the undisputed leader in ad delivery for almost every medium. Owning Massive gives Microsoft a solid head start though it hasn't helped them in the past when going against Google. Some are predicting massive growth for that group but one blogger doesn't see how that provides value to the gamers ... more on that in a minute.

I think Google needs to buy or partner with Wii or purchase Sony's PS3 unit. I'd like to see them build the hardware but that doesn't seem to be the way they do things. I would also like to see a gaming console built on Andriod, which would allow anyone to create games, alter games and probably lower the price significantly.

The name of this blog is Eyeball Economy. I believe almost all media should, and will, be free. As a consumer, an organization should subsidize my media consumption (eventually to zero-cost) with the realistic hopes that I could then become one of their consumers.

A lot of things I've been thinking about over the last few months concern distribution. I shouldn't find that odd considering I work for a company primarily known for the distribution of multimedia and plain-text press releases. I think there will be a ton of consolidation in the TV/Internet delivery space and I think the best companies to make those moves will be Microsoft, Google and Apple. Sony could still contend but they have no foundation in advertising to become a factor. Having internet capabilities built into televisions is a great start, but they're going to have to rely on other companies to deliver the content.

To recap a scattered post:

• Google should buy the PS3 or the Wii and Scientific Atlanta or another set-top box maker (like Cisco's recent acquisition of DVN.)
• Video games will primarily be played on the television or computer for a lot longer. Delivering ads to those eyeballs is where the money will be. Look for some action in the space over the next 6-12 months.
• Media (tv, internet, video games, web content) will all be subsidized by advertisers
  

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Will Location Based Programs Farewell?

Though I only get slightly creeped out by the prompt on my iPhone asking me if I'd like to share my location, it is not as invasive as dodgeball or BrightKite. Dodgeball, though purchased by Google, never took off despite the initial shiny factor. BrightKite isn't taking off because the service doesn't make much sense. What's the purpose of these programs? Stalker enablers? I completely understand that they're "opt-in," I just don't want to get that involved ... it also speaks to my feelings about Facebook, MySpace, Friendster, etc. (ask me over a drink, I dare you).

Anyhow, enter Garmin ... Garmin partnered with uLocate "to add friend-finding capabilities to select current and future Garmin GPS devices."

The Alley Insider thinks that location-based services might be a $3.3 Billion market in 5 years. I'm no expert in the futures market of LBS, I just think that this fervor is misdirected.

Location-based Advertising is going to be a prevalent disruption, this is for sure.

Let's use Apple's iPhone as an example (shocker). Imagine if the (newly, much improved) Google Maps application pulls local and relevant advertising just as quick as it can find an address. Imagine if that advertising included Yelp reviews. Imagine of positive reviews that resulted in OpenTable reservations resulted in revenue for that Yelp reviewer? As a foodie, I think this could be the biggest opportunity. Unfortunately, it seems restaurants (conglomerates or local mom and pops) have very low PR budgets.

Location based services are not going to be that big unless they include advertising in the forecast. I don't think they did and that's why I think that report was way off... Agree?

Speaking of low PR budgets, and due out very soon on this shelf, "Why Advertising and Marketing Need to Share."

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The New Mobile Advertising Model; Exactly

While everyone is talking about the lines, activation issues, lack of new features, GPS, the genius of certain applications, the impact of certain applications (rightfully so), etc., a much bigger story is taking shape. Millions of people have purchased the new iPhone 3G. In fact, over the weekend alone 1 million were sold. This would leave me to believe (especially considering that our local AT&T shop is out for 7 - 21 days) that many millions more have been sold. While there is no doubt they (Nasdaq: AAPL) will exceed sales expectations and engender millions of new loyal Mac users, they are also doing a huge favor for their partners... both advertising and application. Apple has just created one of the largest advertisement delivery networks ever.

Each user of the new device, as well as the old device, will be consuming content in the most modern way ... via RSS feeds and efficient open-sourced applications. I am not quite sure why it has not gotten much coverage yet, but Apple is monetizing their phone better than many websites are. This should be viewed as a very big sea change in advertising (are you watching, Google?). Monetizing Web sites is a somewhat recent invention ... not only is Apple selling applications to their users, but they are selling advertising space to their partners ... that is, if they are getting this revenue!?!

Having downloaded the 2.0 firmware July 10th, I've accessed the NYTimes application several times and only seen this Westin ad. I'm sure I'm not alone ... How many people have seen this add? One million? How many iPhone 1.0 and 2.0 users are there? How many times has this application been downloaded? Luckily, I'm sure Apple will be able to tell, in this case, Westin, exactly how many people have seen their advertisement.

To many this doesn't sound very major. It is. The one thing that advertising and marketing firms have been terrible at, as long as they've existed, is precision. PR has always had the expectation of precision: exactly how many papers covered the story; exactly how many people viewed the press release; exactly.

I doubt Apple is going to be providing "Opportunities to View" as the measure to their clients. They will tell Westin exactly how many people saw their ad ... they could probably tell them, to a certain degree, who. Regarding precise demographics, which I'm sure AT&T and Apple have, they may be able to tell everything ... one via contracts and social security numbers, the other via iTunes and other web habits.

We will see if Apple will squander this opportunity by failing the measurement test or by failing our privacy expectations ... I doubt it.

What advertisements have you seen? Which applications are being advertised on/in?


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The Eyeball Economy

Thomas Hawk wrote a great piece on the future of stock photography and how FlickR, Getty Images, Yahoo and iStockphoto will fare.

He raised an incredibly interesting point today on FriendFeed about the low price photographers are being paid via iStockphoto.

This brings up, in my mind, a much larger issue. Moving forward, will the price and cost of content be inverse to the price of eyeballs?

In this age of time-shifting, place-shifting, RSS, microblogs and their aggregators, marketers are having a very difficult time reaching consumers directly. They have been placing dollar amounts for years on Television commercials, billboards, radio ads, print ads, even press releases. With the audiences of MSM dwindling (in TV's case, the number of people that have to watch commercials is decreasing), the value of audiences in these other places should increase dramatically. This is one of the reasons why we will see a tremendous increase in the cost and value of banner ads ... yes, banner ads again.

In the same vein, since everyone is a potential content producer, how much is it worth anymore? With web shows like RocketBoom, Wall-Strip and The Burbs (not counting all of the YouTube/Revver/MetaCafe 'Celebrities'), anyone can be a content creator. All you need is a cell phone, camcorder, or webcam. Since some of this content is more interesting and compelling, why pay for cable anymore (especially when Fox kills shows like Arrested Development in favor of Prison Break and assorted karaoke shows).

I think this is the beginning of the opposite of an attention crash. What would we call this?

With aggregators like iGoogle, Netvibes and, yes, FriendFeed, I'm able to keep track of and pay attention to far more information than ever. While some of what I retain is nominal (I remember a ton of headlines), I don't read a lot of content in its entirety. I am retaining all of this information where I used to store things like ... oh, phone numbers! While I have four personal phone numbers myself (I don't even know my home phone number), I don't know how many others I recall. I remember my phone numbers from the houses I grew up in. Even some of my best friends numbers from those days ... but certainly new numbers don't get stored in my brain... just headlines, failed social networks, and poor showings by the New York Rangers.

Back to topic: How much is content going to be worth? When are ad values going to increase dramatically? Your thoughts?

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