Casual Games: Too Much of a Good Thing?

As industry giants such as EA look to build focused businesses around a niche market, does this sudden glut of properties herald a larger problem?

by Paul Hyman

From a developer's point of view, casual games are the place to be. They're relatively quick and cheap to create, simple to distribute, and the easy-to-learn video games appeal to such a huge mass audience that the more that can be made, the merrier.

Not so, says one prominent industry analyst who warns that even though a large supply is needed to satisfy all the various platforms that offer casual games—from mobile devices and PC portals to video game consoles and even in-flight entertainment—a glut may be on the horizon.

"Everyone is jumping onboard—every media company, every small garage, even companies that you'd never suspect would be in gaming," says Ben Schachter of UBS. "That's because a small investment can get you into the business; there aren't a ton of barriers to entry."

For instance, says the analyst, "you ask why a company like Orbitz—which sells travel products—is in the casual games space with a popular site called OrbitzGames. Well, they're using games as a marketing tool. Everyone has their own reasons for being in casual games."

But an oversupply of casual games is likely to confuse people and lower the value of the best titles, notes Schachter. "No one will be able to keep track of what's available or what is the difference between one game and another," he says.

Indeed, some indie developers think there's already a glut on the market.

"The space is so crowded with developers," says Ben Lewis, head of marketing and sales at year-old Baton Rouge, La.-based Yatec Games. "There are thousands out there, with new and bigger players entering the market every day. We small developers need to make sure that we don't fall in between the cracks."

But Lewis is optimistic: "The growth spurt tends to legitimize the industry as a whole. Many people still view casual gaming as small potatoes, but we're really a huge industry with a much wider market than hardcore games. If people now come to realize that, so much the better."

Further evidence of casual games' skyrocketing popularity is the surprising success of Nintendo's Wii. The next-generation game console is proof positive that there are those consumers who don't necessarily consider themselves gamers, who are outside the usual target demographic of 18-35-year-old males, and who will still go out and buy a game machine that doesn't necessarily appeal to so-called hardcore gamers.

"It's not that the hardcore gamers aren't still out there," notes Schachter. "They still want Halo 3 and Grand Theft Auto. But it's clear that there are a lot of other people who are willing to come back to video games if they're easy to pick up and fun to play. That's the lesson the Wii has taught us."

Some might say that the games developed for the Wii don't fit the usual definition of casual games, but UBS' Schachter reports that definition is now expanding.

"While no one has agreed on a standard definition, I believe a casual game is any game that is easy to get into, gets to the fun quickly, and you don't have to shell out a lot of money to play," he explains.

Indeed, at Electronic Arts, the video game giant has broadened its own definition of casual games considerably. In June, EA reorganized and created a Casual Entertainment Group that now oversees not only the typical small, downloadable games that the company makes available on its Pogo.com Web portal, but also all of its mobile games, its kid-friendly games, and its all-family games.

The Group's first offering was this month's release of Boogie for the Wii, which allows gamers to use the packaged microphone to score points by showing off their karaoke and dancing skills.

Similarly, EA just signed an agreement with toy manufacturer Hasbro to create casual games based on some of its original IP, which includes Monopoly, Scrabble, Yahtzee, Nerf, and Tonka. The first several games—none of which have been announced—are scheduled to launch sometime next year on various platforms.